Announcement of tender offer to purchase bonds
LAND SECURITIES GROUP PLC
("LAND SECURITIES")
LAND SECURITIES ANNOUNCES TENDER OFFER
TO PURCHASE BONDS FOR CASH
Land Securities confirms that its wholly owned subsidiary, QAM Funding Limited Partnership (QAM), has today launched an invitation to holders of the Sceptre Funding No.1 PLC bonds secured against the rental income from Queen Anne's Gate, SW1, to tender their notes for cash. The bonds pay a coupon of 5.253% and have a final maturity date of February 2027. There are currently £273,177,575 of notes outstanding. The transaction is expected to be funded through existing financial resources.
This transaction is a continuation of Land Securities' disciplined approach to balance sheet management.
A further release will be issued on 21 April 2017 confirming the results of the tender offer.
The following release was issued to the Irish Stock Exchange this afternoon:
"QAM FUNDING LIMITED PARTNERSHIP ANNOUNCES TENDER OFFER TO PURCHASE BONDS FOR CASH AND CONSENT SOLICITATION IN RESPECT OF THE BONDS
QAM Funding Limited Partnership (QAM) has today launched an invitation to the holders (the Bondholders) of Sceptre Funding No.1 PLC's (the Issuer) presently outstanding £273,177,575 5.253 per cent. Bonds due 2027 (ISIN: XS0441698866) (the Bonds) to tender their Bonds for purchase by QAM for cash (the Tender Offer) and the Issuer has launched an invitation to the Bondholders to consent to certain modifications to the optional redemption provisions relating to the Bonds contained within the Trust Deed (as defined in the Offer Memorandum) as proposed by the Issuer (the Proposal) for approval by Extraordinary Resolution at a meeting of Bondholders (the Meeting) (such invitation, the Consent Solicitation). The Tender Offer and the Consent Solicitation are subject to the conditions set out in the in the consent solicitation and tender offer memorandum dated 30 March 2017 (the Offer Memorandum), including the offer and distribution restrictions set out below and as more fully described in the Offer Memorandum.
Copies of the Offer Memorandum are (subject to offer restrictions) available from the Tender and Tabulation Agent as set out below. Capitalised terms used and not otherwise defined in this announcement have the meanings given in the Offer Memorandum.
Summary of the Tender Offer
|
Description of the Bonds |
ISIN / Common Code |
Benchmark |
Late Spread |
Earlybird Spread |
Amount subject to the Tender Offer |
|
£273,177,5755.253 per cent. Bonds due 2027 |
XS0441698866 / 0441698866 |
UKT 1.750 per cent. due September 2022 |
50 bps |
47 bps |
Any and all |
Summary of the Consent Solicitation
|
Minimum notice period to be provided to Bondholders prior to the exercise of the Issuer's optional redemption right |
Reduction of minimum period from 30 days to 5 days |
|
Quotation of the yield in respect of the reference United Kingdom government stock |
Amendment to the Bloomberg Screen DM02<GO> Page |
|
Clarification concerning the price payable in respect of the exercise of the Issuer's optional redemption right |
Amendment to the definition of "Redemption Rate" to clarify that the redemption price is "modified spens" |
|
Confirmation of benchmark |
Confirmation that the relevant treasury stock is UKT 1.750 per cent. due September 2022 (ISIN: GB00B7L9SL19) |
The Tender Offer will expire at 10 a.m. (London time) on 19 April 2017 (the Final Deadline) unless extended, amended or terminated early by QAM. Bondholders that wish to participate in the Tender Offer and to be eligible to receive the Earlybird Purchase Price must make the necessary arrangements for the delivery to the Tender and Tabulation Agent by 4.00 p.m. (London time) on 13 April 2017 (the Early Deadline) of a valid Tender Instruction in respect of the Tender Offer. Bondholders that deliver valid Tender Instructions to the Tender and Tabulation Agent after the Early Deadline but on or before the Final Deadline will be eligible for the Late Purchase Price.
QAM is not under any obligation to accept for purchase any Bonds tendered pursuant to the Tender Offer. The acceptance for purchase by QAM of Bonds tendered pursuant to the Tender Offer is at the sole discretion of QAM and tenders may be rejected by QAM for any reason.
Whether QAM will purchase any Bonds validly tendered in the Tender Offer is subject, without limitation, to the Extraordinary Resolution being passed and conditions to the implementation of the Extraordinary Resolution being satisfied (the Extraordinary Resolution Condition). The Extraordinary Resolution Condition may be waived by QAM in its sole discretion.
Rationale for the Tender Offer and the Proposal
The purpose of the Tender Offer and the Proposal is to:
a) provide liquidity to Bondholders and proactively manage the Land Securities Group's balance sheet; and
b) clarify the redemption rate in respect of the Issuer optional redemption provision relating to the Bonds and make certain additional and consequential amendments to this provision.
Details of the Tender Offer
On the Settlement Date, QAM will pay for Bonds accepted by it for purchase pursuant to the Tender Offer a price to be determined at the Pricing Time on the Pricing Date in the manner described in the Offer Memorandum by reference to:
(a) in respect of Bonds tendered for purchase pursuant to Tender Instructions delivered on or prior to the Early Deadline, the sum (such sum, the Earlybird Purchase Yield) calculated as the sum of a purchase spread of 47 basis points (the Earlybird Spread) and the Benchmark Security Rate; and
(b) in respect of the Bonds tendered for purchase pursuant to Tender Instructions delivered after the Early Deadline, the sum (such sum, the Late Purchase Yield and, together with the Earlybird Purchase Yield, the Purchase Yields and each a Purchase Yield) calculated as the sum of a purchase spread of 50 basis points (the Late Spread and, together with the Earlybird Spread, the Spreads, and each a Spread) and the Benchmark Security Rate.
Each Purchase Price will be determined by QAM, after consultation with the Dealer Manager, in accordance with market convention and expressed as a percentage of the principal amount of the Bonds (and rounded to the nearest 0.001 per cent. with 0.0005 per cent. being rounded upwards), and is intended to reflect a yield to maturity of the Bonds on the Settlement Date based on the relevant Purchase Yield.
Specifically, each Purchase Price applicable to the Bonds will equal (a) the value of all remaining payments of principal and interest on the Bonds up to and including the Final Maturity Date, discounted to the Settlement Date at a discount rate equal to the relevant Purchase Yield, minus (b) Accrued Interest in respect of the Bonds.
QAM will also pay, on the Settlement Date, an Accrued Interest Payment in respect of Bonds accepted for purchase pursuant to the Tender Offer.
Tender Instructions
In order to participate in the Tender Offer, and be eligible to receive the applicable Purchase Price and the Accrued Interest Payment pursuant to the Tender Offer, Bondholders must validly tender their Bonds by delivering, or arranging to have delivered on their behalf, a valid Tender Instruction that is received by the Tender and Tabulation Agent by the relevant deadline.
Bondholders who submit a Tender Instruction will be voting in favour of the Extraordinary Resolution. It will not be possible to submit a valid Tender Instruction without instructing the Principal Paying Agent to appoint the Tender Agent as its proxy to attend the Meeting and vote in the favour of the Extraordinary Resolution.
Tender Instructions will be irrevocable except in the limited circumstances described in the Offer Memorandum.
Bondholders are advised to check with any bank, securities broker or other intermediary through which they hold their Bonds when such intermediary would need to receive instructions from a Bondholder in order for such Bondholder to participate in, or (in the limited circumstances in which revocation is permitted) to validly revoke their instruction to participate in, the Tender Offer, the Consent Solicitation and/or the Proposal before the deadlines specified in the Offer Memorandum. The deadlines set by any such intermediary and each Clearing System for the submission of Tender Instructions or Solicitation Instructions will be earlier than the relevant deadlines specified in the Offer Memorandum.
Summary of the Consent Solicitation and the Proposal
The Consent Solicitation commences on the date of the Offer Memorandum and expires at 10 a.m. (London time) on 19 April 2017 (the Final Deadline). Bondholders that wish to participate in the Consent Solicitation and to be eligible to receive the Earlybird Voting Fee must make the necessary arrangements for the delivery to the Tender and Tabulation Agent by the Early Deadline of a valid Solicitation Instruction in respect of the Extraordinary Resolution (whether voting for or against the Extraordinary Resolution).
The purpose of the Consent Solicitation and the Proposal is to modify certain provisions of the Trust Deed constituting the Bonds concerning the Issuer's optional redemption right in order to (i) reduce the minimum notice period to be provided to Bondholders prior to the exercise of the Issuer's optional redemption right from 30 days to 5 days, (ii) provide that a specific screen page will be used to determine the yield in respect of the relevant reference United Kingdom government stock instead of a quotation from three market makers, (iii) provide for UKT 1.750 per cent. due September 2022 (ISIN: GB00B7L9SL19) to be used as the benchmark gilt instead of being chosen by three market makers and (iv) clarify the price payable to Bondholders in respect of the exercise of the Issuer's optional redemption right.
The Issuer will pay to the Bondholders (whether Eligible Bondholders or Ineligible Bondholders) that validly deliver Solicitation Instructions to the Tender and Tabulation Agent in respect of the Extraordinary Resolution (whether voting for or against the Extraordinary Resolution) by the Early Deadline, a price equal to the difference between the Earlybird Purchase Price and the Late Purchase Price multiplied by the principal amount of Bonds that are subject to such Solicitation Instructions (rounded to the nearest 0.001 per cent. with 0.0005 per cent. being rounded upwards) (the Earlybird Voting Fee). Bondholders who have already submitted Tender Instructions prior to the Early Deadline will be eligible to receive the Early Purchase Price, which includes an amount equivalent to the Earlybird Voting Fee. Bondholders may not submit Tender Instructions and Solicitation Instructions in respect of the same Bonds.
Recommendation of the Proposal by the Investment Association
The Proposal has been considered by a Special Committee of the Investment Association (the IA Special Committee) at the request of the Issuer. The members of the IA Special Committee, who hold in aggregate approximately 50.81 per cent of the aggregate Principal Amount Outstanding of the Bonds, have examined the Proposal. They have informed the Issuer that they find the Proposal acceptable; that, subject to client and other approvals, they intend to vote in favour of the Proposal in respect of their holdings of Bonds.
The IA Special Committee has advised the Issuer that this recommendation relates only to the proposals set out in the Offer Memorandum with respect to the Bonds and not to any future offers or proposals which the Issuer may make.
Expected Timetable of Events
The following table sets out the expected dates and times of the key events relating to the Tender Offer and Consent Solicitation. This is an indicative timetable and is subject to change. All times are London time.
|
Launch of Tender Offer, Consent Solicitation and Proposal |
|
|
Announcement of the Tender Offer, Consent Solicitation and Proposal. |
30 March 2017. |
|
Early Deadline |
|
|
Deadline for receipt by the Tender and Tabulation Agent of (i) valid Tender Instructions in respect of the Tender Offer for Bondholders to be eligible for the Earlybird Purchase Price or (ii) valid Solicitation Instructions in respect of the Extraordinary Resolution for Bondholders to be eligible for the Earlybird Voting Fee. |
4.00 p.m. (London time) on 13 April 2017. |
|
Final Deadline |
|
|
Deadline for (i) submitting any Tender Instructions or Solicitation Instructions and (ii) making any other arrangements to attend or be represented or to vote on the Extraordinary Resolution at the Meeting. |
10.00 a.m. (London time) on 19 April 2017. |
|
Meeting |
|
|
Meeting to be held at the offices of Allen & Overy LLP, One Bishops Square, London E1 6AD, United Kingdom. |
10.00 a.m. (London time) on 21 April 2017. |
|
Announcement of results of Meeting |
|
|
Announcement of the results of the Meeting. |
As soon as reasonably practicable after the Meeting. |
|
Execution of Second Supplemental Trust Deed |
|
|
If the Extraordinary Resolution is passed at the Meeting and is unconditional, execution of the Second Supplemental Trust Deed. Upon execution of the Second Supplemental Trust Deed, the modifications to the Trust Deed described in the Offer Memorandum will become effective. |
As soon as reasonably practicable after the Meeting. |
|
Pricing Time |
|
|
Expected determination of each Purchase Yield and each Purchase Price. |
At or around 1 p.m. (London time) on 21 April 2017 |
|
Announcement of results of Tender Offer and Acceptances |
|
|
Announcement of whether QAM will accept valid tenders of Bonds pursuant to the Tender Offer and, if so accepted, (i) the aggregate principal amount of Bonds accepted for purchase, (ii) the Purchase Yields; (iii) each Spread, (iv) each Purchase Price, (v) the Accrued Interest and (vi) the Settlement Date. |
As soon as reasonably practicable after the Pricing Time. |
|
Settlement |
|
|
Expected Settlement Date. |
25 April 2017 |
The above times and dates are subject to the right of QAM to extend, re-open, amend, waive any condition of and/or terminate the Tender Offer (subject to applicable law and as provided in the Offer Memorandum). Bondholders are advised to check with any bank, securities broker or other intermediary through which they hold their Bonds whether such intermediary would require receipt of instructions to participate in the Tender Offer before the deadlines specified above.
Bondholders are advised to read carefully the Offer Memorandum for full details of, and information on the procedures for participating in, the Tender Offer, the Consent Solicitation and/or the Proposal.
Questions and requests for assistance in connection with (i) the Tender Offer, may be directed to the Dealer Manager, and (ii) the delivery of Tender Instructions, may be directed to the Tender and Tabulation Agent, the contact details for both of which are set out below.
This announcement is released by QAM Funding Limited Partnership and contains information that qualified or may have qualified as inside information for the purposes of Article 7 of the Market Abuse Regulation (EU) 596/2014 (MAR), encompassing information relating to the Tender Offer, the Consent Solicitation and/or the Proposal described above. For the purposes of MAR and Article 2 of Commission Implementing Regulation (EU) 2016/1055, this announcement is made by James Gillard, a Director of QAM (GP) Limited, the general partner of the Partnership.
HSBC Bank plc (Telephone: +44 (0) 20 7992 6237; Attention: Liability Management Group; Email: LM_EMEA@hsbc.com) is acting as Dealer Manager and Deutsche Bank AG, London Branch (Telephone: +44 20 7547 5000; Attention: Corporate Trust, Debt & Agency Services; Email: xchange.offer@db.com) is acting as Tender and Tabulation Agent.
DISCLAIMER This announcement must be read in conjunction with the Offer Memorandum. This announcement and the Offer Memorandum contain important information which should be read carefully before any decision is made with respect to the Tender Offer. If any Bondholder is in any doubt as to the contents of the Offer Memorandum or the action it should take, it is recommended to seek its own financial advice, including in respect of any tax consequences, from its broker, bank manager, solicitor, accountant or other independent financial, tax or legal adviser. Any individual or Issuer whose Bonds are held on its behalf by a broker, dealer, bank, custodian, trust Issuer or other nominee must contact such entity if it wishes to tender such Bonds pursuant to the Tender Offer. The Dealer Manager will not be responsible to any Bondholders for providing the protections afforded to customers of the Dealer Manager or for advising any other person in connection with the Tender Offer. None of the QAM, the Issuer, the Dealer Manager or the Tender Agent makes any recommendation whether Bondholder should tender Bonds pursuant to the Tender Offer. None of the Dealer Manager, the Tender Agent or any of their respective directors, employees or affiliates makes any representation or recommendation whatsoever regarding this announcement, the Offer Memorandum or the Tender Offer, or takes any responsibility for the contents of this announcement or the Offer Memorandum.
Offer and Distribution Restrictions
The distribution of this announcement and the Offer Memorandum in certain jurisdictions may be restricted by law. Persons into whose possession this announcement and/or the Offer Memorandum comes are required by each of QAM, the Dealer Manager and the Tender and Tabulation Agent to inform themselves about, and to observe, any such restrictions. Nothing in this announcement or the Offer Memorandum or the electronic transmission thereof constitutes an offer to buy or the solicitation of an offer to sell Bonds (and tenders of Bonds in the Tender Offer will not be accepted from Bondholders) in any circumstances in which such offer or solicitation is unlawful. In those jurisdictions where the securities, blue sky or other laws require a Tender Offer to be made by a licensed broker or dealer and the Dealer Manager or any of their respective affiliates is such a licensed broker or dealer in any such jurisdiction, such Tender Offer shall be deemed to be made by such Dealer Manager or such affiliate, as the case may be, on behalf of QAM in such jurisdiction.
United States
The Tender Offer is not being made, and will not be made, directly or indirectly in or into, or by use of the mail of, or by any means or instrumentality of interstate or foreign commerce of or of any facilities of a national securities exchange of, the United States or to any U.S. Person (as defined in Regulation S of the United States Securities Act of 1933, as amended (each a U.S. Person)). This includes, but is not limited to, facsimile transmission, electronic mail, telex, telephone, the internet and other forms of electronic communication. The Bonds may not be tendered in the Tender Offer by any such use, means, instrumentality or facility from or within the United States or by persons located or resident in the United States. Accordingly, copies of this announcement, the Offer Memorandum and any other documents or materials relating to the Tender Offer are not being, and must not be, directly or indirectly mailed or otherwise transmitted, distributed or forwarded (including, without limitation, by custodians, nominees or trustees) in or into the United States or to any persons located or resident in the United States. Any purported tender of Bonds in an Offer resulting directly or indirectly from a violation of these restrictions will be invalid and any purported tender of Bonds made by a person located in the United States, by any person acting for or on the account or benefit of any U.S. Person, or any agent, fiduciary or other intermediary acting on a non-discretionary basis for a principal giving instructions from within the United States will be invalid and will not be accepted.
Each holder of Bonds participating in the Tender Offer will represent that it is not located in the United States and is not participating in an Offer from the United States, or it is acting on a non-discretionary basis for a principal located outside the United States that is not giving an order to participate in an Offer from the United States. For the purposes of this and the above paragraph, United States means the United States of America, its territories and possessions, (including Puerto Rico, the U.S. Virgin Islands, Guam, American Samoa, Wake Island and the Northern Mariana Islands), any state of the United States of America and the District of Columbia.
United Kingdom
The communication of this announcement, Offer Memorandum and any other documents or materials relating to the Tender Offer is not being made and such documents and/or materials have not been approved by an authorised person for the purposes of section 21 of the Financial Services and Markets Act 2000. Accordingly, such documents and/or materials are not being distributed to, and must not be passed on to, the general public in the United Kingdom. The communication of such documents and/or materials as a financial promotion is only being made to those persons in the United Kingdom falling within the definition of investment professionals (as defined in Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (the Financial Promotion Order)) or persons who are within Article 43(2) of the Financial Promotion Order or any other persons to whom it may otherwise lawfully be made under the Financial Promotion Order.
Belgium
Neither this announcement, the Offer Memorandum nor any other documents or materials relating to the Tender Offer have been submitted to or will be submitted for approval or recognition to the Belgian Financial Services and Markets Authority and, accordingly, the Tender Offer may not be made in Belgium by way of a public offering, as defined in Article 3 of the Belgian Law of 1 April 2007 on public takeover bids, as amended or replaced from time to time. Accordingly, the Tender Offer may not be advertised and the Tender Offer will not be extended, and neither this announcement, the Offer Memorandum nor any other documents or materials relating to the Tender Offer (including any memorandum, information circular, brochure or any similar documents) have been or shall be distributed or made available, directly or indirectly, to any person in Belgium other than "qualified investors" within the meaning of Article 10 of the Belgian Law of 16 June 2006 on public offerings of investment instruments and the admission of investment instruments to trading on regulated markets (as amended from time to time).
France
The Tender Offer is not being made, directly or indirectly, to the public in the Republic of France (France). Neither this announcement, the Offer Memorandum nor any other documents or materials relating to the Tender Offer have been or shall be distributed to the public in France and only (i) providers of investment services relating to portfolio management for the account of third parties (personnes fournissant le service d'investissement de gestion de portefeuille pour compte de tiers) and/or (ii) qualified investors (investisseurs qualifiés) other than individuals, in each case acting on their own account and all as defined in, and in accordance with, Articles L.411-1, L.411-2 and D.411-1 of the French Code Monétaire et Financier, are eligible to participate in the Tender Offer. Neither this announcement, the Offer Memorandum nor any other document or material relating to the Tender Offer has been or will be submitted for clearance to or approved by the Autorité des marchés financiers.
Italy
None of the Tender Offer, this announcement, the Offer Memorandum or any other document or materials relating to the Tender Offer have been or will be submitted to the clearance procedures of the Commissione Nazionale per le Società e la Borsa (CONSOB) pursuant to Italian laws and regulations. The Tender Offer is being carried out in Italy as exempted offers pursuant to article 101-bis, paragraph 3-bis of the Legislative Decree No. 58 of 24 February 1998, as amended (the Financial Services Act) and article 35-bis, paragraph 4 of CONSOB Regulation No. 11971 of 14 May 1999, as amended. Accordingly, Bondholders or beneficial owners of the Bonds that are located in Italy can tender Bonds for purchase pursuant to the Tender Offer through authorised persons (such as investment firms, banks or financial intermediaries permitted to conduct such activities in the Republic of Italy in accordance with the Financial Services Act, CONSOB Regulation No. 16190 of 29 October 2007, as amended from time to time, and Legislative Decree No. 385 of 1 September 1993, as amended) and in compliance with applicable laws and regulations or with requirements imposed by CONSOB or any other Italian authority.
Each intermediary must comply with the applicable laws and regulations concerning information duties vis-à-vis its clients in connection with the Bonds or the Tender Offer.
Ireland
The Tender Offer is not being made, directly or indirectly, to the public in Ireland and no offers or sales of any notes or securities under or in connection with the Tender Offer may be effected and the Offer Memorandum may not be distributed in Ireland except in conformity with the provisions of Irish law including (i) the Companies Act 2014, (ii) the Prospectus (Directive 2003/71/EC) Regulations 2005 (as amended) and any rules issued under Section 1363 of the Companies Act 2014 by the Central Bank of Ireland, (iii) the European Communities (Markets in Financial Instruments) Regulations 2007 (Nos 1 to 3) (as amended) including, without limitation, Regulations 7 and 152 thereof or any codes of conduct issued in connection therewith, and the provisions of the Investor Compensation Act 1998 (as amended), (iv) the Market Abuse (Directive 2003/6/EC) Regulations 2005 (as amended) and any rules issued under Section 1370 of the Companies Act 2014, and (v) the Central Bank Acts 1942 to 2015 and any codes of conduct rules made under Section 117(1) of the Central Bank Act 1989 (as amended)."
- Ends -
Land Securities Group PLC
Investors
Edward Thacker
T: +44 (0)20 7024 5185
edward.thacker@landsecurities.com
This information is provided by RNS
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