REG - Cogels Investments Xpediator PLC - Recommended Cash Offer for Xpediator PLC
06/04/2023 07:00
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RNS Number : 5628V Cogels Investments Limited 06 April 2023
NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION IN WHOLE OR IN PART, DIRECTLY OR
INDIRECTLY, IN, INTO OR FROM ANY JURISDICTION WHERE TO DO SO WOULD CONSTITUTE
A VIOLATION OF THE RELEVANT LAWS OF SUCH JURISDICTION.
THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION FOR THE PURPOSES OF ARTICLE 7 OF
THE UK VERSION OF THE MARKET ABUSE REGULATION (EU 596/2014) WHICH IS PART OF
UK LAW BY VIRTUE OF THE EUROPEAN UNION (WITHDRAWAL) ACT 2018.
THIS ANNOUNCEMENT IS NOT A PROSPECTUS OR PROSPECTUS EXEMPT DOCUMENT AND
XPEDIATOR SHAREHOLDERS SHOULD NOT MAKE ANY DECISION IN RELATION TO THE CASH
OFFER OR THE LOAN NOTE ALTERNATIVE EXCEPT ON THE BASIS OF THE INFORMATION TO
BE CONTAINED IN THE SCHEME DOCUMENT WHICH IS PROPOSED TO BE PUBLISHED IN DUE
COURSE.
FOR IMMEDIATE RELEASE
6 April 2023
RECOMMENDED cash offer
for
Xpediator plc ("XPEDIATOR")
BY
DLM BIDCO LIMITED ("bidco")
a newly incorporated entity to be indirectly owned by (i) funds advised by
BaltCap, (ii) Cogels Investments and (iii) Nuoma IR Kapitalas, as members of
the Consortium
to be implemented by means of a Scheme of Arrangement
under Part 26 of the Companies Act 2006
Summary
· The boards of Bidco and Xpediator are pleased to
announce that they have reached agreement on the terms of a recommended cash
offer by Bidco, a newly-incorporated entity to be indirectly owned by the
Consortium, to acquire the entire issued and to be issued ordinary share
capital of Xpediator (excluding the Xpediator Shares owned or controlled by
Cogels Investments). As at the Latest Practicable Date, Cogels Investments
owned or controlled 37,260,660 Xpediator Shares, representing approximately
26.3 per cent. of Xpediator's issued share capital as at such date.
· Under the terms of the Offer, each Scheme
Shareholder will be entitled to receive 44 pence for each Scheme Share held
(the "Cash Value"), comprising for each Scheme Share:
42 pence in cash (the "Cash Offer")
and
a special dividend of 2 pence (the "Special Dividend")
· The Cash Value of 44 pence for each Scheme Share
values the entire issued and to be issued ordinary share capital of Xpediator
at approximately £62,342,907, and represents a premium of approximately:
- 45.5 per cent. to the Closing Price of 30.3
pence per Xpediator Share on 19 December 2022 (being the last Business Day
before the date of the commencement of the Offer Period);
- 18.9 per cent. to the Closing Price of 37.0
pence per Xpediator Share on 5 April 2023 (being the last Business Day before
the date of this Announcement); and
- 79.7 per cent. to the volume weighted
average Closing Price of 24.5 pence per Xpediator Share for the three-month
period ended 19 December 2022.
· Under the terms of the Offer, a Loan Note
Alternative will be available to Scheme Shareholders (other than Scheme
Shareholders resident or located in a Restricted Jurisdiction, including the
United States), which will enable eligible Scheme Shareholders to elect to
receive Loan Notes in lieu of part or all of the cash consideration to which
they would otherwise be entitled under the terms of the Offer. Further details
in relation to the Loan Note Alternative are set out in paragraph 10 below.
· The Xpediator Directors intend to declare and pay
the Special Dividend of 2 pence per Xpediator Share to Xpediator Shareholders
on the register of members of Xpediator at the Scheme Record Time. The Special
Dividend is conditional upon, and only payable if, the Scheme becomes
Effective (or, if the Offer is implemented by way of a Takeover Offer, the
Takeover Offer is declared unconditional in all respects). Further details are
set out in paragraph 18 of this Announcement.
· The Xpediator Shares owned or controlled by Cogels
Investments (being 37,260,660 Xpediator Shares as at the Latest Practicable
Date) will not be Scheme Shares and will not be acquired by Bidco pursuant to
the Offer. Upon the Offer becoming Effective, Cogels Investments will: (i)
indirectly contribute 36,299,777 Xpediator Shares owned or controlled by it
(representing approximately 25.62 per cent. of Xpediator's issued share
capital on the Latest Practicable Date) to Bidco; and (ii) sell 960,883
Xpediator Shares owned or controlled by it (representing approximately 0.68
per cent. of Xpediator's issued share capital on the Latest Practicable Date)
to Bidco in exchange for cash at the same price per Xpediator Share as the
Cash Offer. Cogels Investments and the Blyth Family Members will not be
permitted to vote the Xpediator Shares owned or controlled by them at the
Court Meeting, but will be permitted to vote such Xpediator Shares at the
General Meeting. Notwithstanding the fact that the Blyth Family Members will
not be permitted to vote their Xpediator Shares at the Court Meeting, each of
the Blyth Family Members have undertaken for their Xpediator Shares to be
bound by the terms of the Scheme.
Xpediator recommendation
· The Xpediator Directors, who have been so advised
by Zeus Capital as to the financial terms of the Offer, consider the terms of
the Offer to be fair and reasonable. In providing advice to the Xpediator
Directors, Zeus Capital has taken into account the commercial assessments of
the Xpediator Directors. Zeus Capital is providing independent financial
advice to the Xpediator Directors for the purposes of Rule 3 of the Takeover
Code.
· Accordingly, the Xpediator Directors intend to
recommend unanimously that, in the case of the Court Meeting, Scheme
Shareholders, and in the case of the General Meeting, Xpediator
Shareholders, vote in favour of the Scheme at the Court Meeting and vote in
favour of the Resolution(s) at the General Meeting as all Xpediator Directors
holding Xpediator Shares as at the date of this Announcement have irrevocably
undertaken to do (or procure to be done) in respect of their own holdings
totalling 2,008,677 Xpediator Shares, representing approximately 1.93 per
cent. of Scheme Shares entitled to vote at the Court Meeting and 1.42 per
cent. of the issued share capital of Xpediator as at the Latest Practicable
Date.
Irrevocable undertakings
· In addition to the irrevocable undertakings from
the Xpediator Directors, Bidco has received irrevocable undertakings from
Shaun Godfrey, Sandu Grigore and Frances Lee to vote in favour of the Scheme
at the Court Meeting and to vote in favour of the Resolution(s) at the General
Meeting in respect of a total of 38,501,484 Xpediator Shares representing
approximately 37.1 per cent. of Scheme Shares entitled to vote at the Court
Meeting and 27.2 per cent. of the issued share capital of Xpediator as at the
Latest Practicable Date. Bidco has also received irrevocable undertakings from
each of the Blyth Family Members and Cogels Investments to vote in favour of
the Resolution(s) at the General Meeting in respect of a total of 37,781,045
Xpediator Shares representing approximately 26.7 per cent. of the issued share
capital of Xpediator as at the Latest Practicable Date.
· Therefore, as at the date of this Announcement,
Bidco has received irrevocable undertakings to vote in favour of the Scheme at
the Court Meeting in respect of a total of 38,501,484 Xpediator Shares
representing approximately 37.1 per cent. of Scheme Shares entitled to vote at
the Court Meeting and to vote in favour of the Resolution(s) at the General
Meeting in respect of a total of 76,282,529 Xpediator Shares representing
approximately 53.8 per cent. of the issued share capital of Xpediator as at
the Latest Practicable Date.
· In addition, each of the irrevocable undertakings
received from Shaun Godfrey and Sandu Grigore include an undertaking to accept
the Loan Note Alternative with regard to part of the Scheme Shares held by
them, as further detailed below:
- from Shaun Godfrey to accept the Loan Note
Alternative in respect of 18,147,009 Xpediator Shares owned or controlled by
him, representing approximately 12.8 per cent. of the issued share capital of
Xpediator as at the Latest Practicable Date, or such lesser amount as notified
to him by Bidco; and
- from Sandu Grigore to accept the Loan Note
Alternative in respect of 12,629,200 Xpediator Shares owned or controlled by
him, representing approximately 8.9 per cent. of the issued share capital of
Xpediator as at the Latest Practicable Date, or such lesser amount as notified
to him by Bidco.
· Further details of the irrevocable undertakings are
set out in Appendix 3 to this Announcement.
Information on Bidco and the Consortium
· The Consortium is comprised of funds advised by
BaltCap, Cogels Investments and Nuoma IR Kapitalas. Cogels Investments and
funds advised by BaltCap are joint offerors with respect to the Offer.
· Bidco is a limited company registered in England
and Wales and incorporated on 23 February 2023. Bidco was formed for the
purposes of the Offer and has not traded since its date of incorporation, nor
has it entered into any obligations other than in connection with the Offer.
Bidco is ultimately owned by Holdco. As at the Effective Date, Holdco will be
owned in the following proportions: (i) funds advised by BaltCap will
indirectly own 40 per cent. of Holdco; (ii) Cogels Investments will own 34 per
cent. of Holdco; and (iii) Nuoma IR Kapitalas will indirectly own 26 per cent.
of Holdco. The funds advised by BaltCap and Nuoma IR Kapitalas will hold their
interest in Holdco through Lithuanian Newco, being a joint venture vehicle
formed for the purposes of the Offer.
· BaltCap is a multi-strategy private equity and
venture capital investor in the Baltic states of Estonia, Latvia and
Lithuania, covering buyout, growth, venture as well as infrastructure
investments, serving institutional investors from around the world. It was
founded in 1995 and its private equity funds have since invested in
approximately one hundred companies across a wide range of industry sectors
and stages of development. BaltCap will invest in Lithuanian Newco through
BaltCap Private Equity Fund III usaldusfond and its co-investment fund, BPEF
III Supplementary Investment Facility usaldusfond, a €177 million (including
co-investment facility) fund focused on mature enterprises in the Baltics and
Nordics.
· Cogels Investments is a private investment entity
through which the close relatives of Stephen Blyth, the former CEO and founder
of Xpediator, invest in a range of sectors including consultancy, hospitality,
leisure and real estate.
· Nuoma IR Kapitalas is the private investment
vehicle of Justas Veršnickas, the managing director of Delamode Baltics UAB,
a subsidiary of Xpediator. Justas Veršnickas owns 20 per cent. of the issued
share capital of Delamode Baltics UAB but is not an Xpediator Shareholder.
Background to and reasons for the Offer
BaltCap
· For the last 25 years, BaltCap has been one of the
most active investors throughout the Baltic region, and since inception has
invested in around 100 companies across the CEE. BaltCap's investment criteria
are focused on businesses that seek to evolve and develop with significant
upside potential, especially in their growth profile and stature, something
demonstrated by Xpediator over the last few years. BaltCap believes with the
combination of its financial resources, relevant experience and in-depth
knowledge of Xpediator's end markets, Xpediator will be able to successfully
grow in the years to come.
· BaltCap intends to support Xpediator's management
in its efforts to continue to grow its core freight forwarding offering in the
CEE region and internationally, while also providing expertise to improve
operating efficiencies and overhead costs in the UK based businesses.
· BaltCap believes that, following the Effective
Date, it will be able to support Xpediator as it continues to deliver on its
strategic objectives, focuses on growing its core freight forwarding
activities in the CEE region and will help input to strategic options for
logistics operations in the UK and Romania.
· In addition, BaltCap's access to patient capital
will provide the business with the financial backing required to accelerate
its growth both organically and through targeted bolt-on acquisitions.
Cogels Investments
· Cogels Investments believes partnering with
BaltCap, to leverage the parties' combined expertise, will enable Xpediator to
resolve operational and financial issues in the UK and execute its growth
strategy in the CEE region more efficiently and effectively as a private
company.
· Furthermore, one of Xpediator's primary growth
markets is the Baltic region and Cogels Investments believes that partnering
with a well renowned private equity firm in the region and Nuoma IR Kapitalas
will enable Xpediator to accelerate its growth in the region and open new
organic and inorganic growth opportunities previously unavailable.
Nuoma IR Kapitalas
· As the managing director and 20 per cent.
shareholder of Delamode Baltics UAB, a subsidiary of Xpediator, Justas
Veršnickas has a significant role and influence over the success of Xpediator
in the Baltic region.
· Justas Veršnickas will play a leading role in the
operation and growth of Xpediator, especially of its freight forwarding
division, and the Offer facilitates an alignment of interest between the key
stakeholders within the Consortium.
The Consortium
· The members of the Consortium are committed to
accelerating Xpediator's development at this important juncture for the
business and believe taking Xpediator private will enable it to pursue
additional growth opportunities where its people will become part of an
exciting platform in the UK and internationally.
Timetable and Conditions
· It is intended that the Offer will be implemented
by way of a court-sanctioned scheme of arrangement under Part 26 of the
Companies Act. However, Bidco reserves the right to elect to implement the
Offer by way of a Takeover Offer, subject to the Panel's consent and the terms
of the Co-operation Agreement.
· The Offer will be put to Scheme Shareholders
entitled to vote at the Court Meeting and to Xpediator Shareholders at the
General Meeting. To become Effective, the Scheme must be approved by a
majority in number of the Scheme Shareholders voting at the Court Meeting,
either in person or by proxy, representing at least 75 per cent. in value of
the Scheme Shares voted. In addition, the Resolution(s) must be passed by
the requisite majority or majorities at the General Meeting. The Scheme will
also need to be sanctioned by the Court. Finally, a copy of the Court Order
must be delivered to the Registrar of Companies for registration, upon which
the Scheme will become Effective.
· The Offer will be made in accordance with the
Takeover Code and on the terms and subject to the Conditions which are set out
in Appendix 1 to this Announcement, including the antitrust and foreign direct
investment approvals set out in Conditions 3 to 6 of Part A to Appendix 1 to
this Announcement, and on the further terms and conditions that will be set
out in the Scheme Document.
· It is expected that the Scheme Document, containing
further information about the Offer and notices of the Court Meeting and the
General Meeting, will be published as soon as practicable and, in any event,
within 28 days of this Announcement unless Bidco and Xpediator otherwise
agree, and the Panel consents, to a later date.
· The Offer is currently expected to become Effective
in the third quarter of 2023, subject to the satisfaction (or, where
applicable, waiver) of the Conditions and further terms set out in Appendix 1
to this Announcement. An expected timetable of key events relating to the
Offer will be included in the Scheme Document.
Comments on the Offer
Commenting on the Offer, Gillian Wilmot CBE, Interim Chairman of Xpediator,
said:
"Since its IPO in 2017, Xpediator has undergone a period of significant
transformation and growth, having completed four UK acquisitions and
strengthening its presence organically in the CEE regions, particularly in the
Baltics. In more recent years, Xpediator has endured numerous director changes
and instability at the Board level, and this, alongside not inconsiderable
macro-economic challenges, has contributed to a deterioration in the
performance of the two major UK operations, and as a result, the Xpediator
Group working capital position.
The Xpediator Directors have been focused on addressing these issues and are
pleased with the Xpediator Group's record trading performance in 2022. Despite
this, there has been a significant de-rating in Xpediator's valuation over the
past 12 months. Therefore, it is the view of the Xpediator Directors that this
Offer represents a reasonable opportunity for Xpediator Shareholders to
realise cash in what remains a challenging macro-economic environment, the
risk of further Board changes, losing key geographic markets and/or losing
senior management or other key personnel, and the limited liquidity of
Xpediator Shares."
Commenting on the Offer, Šarūnas Alekna, Partner at BaltCap, said:
"We are investing in a company with a long history, proven track record,
exceptional management team and well-established operations in the UK, Baltics
and Central and Eastern Europe. As global supply chains are being shortened
due to macroeconomic and geopolitical risks, we see opportunities to expand
the reach of the freight forwarding operations by adding new geographies and
product offerings, which would enable Xpediator to service a wider range of
needs of its clients in the Baltics, CEE and beyond. BaltCap is excited to
join Xpediator on its journey, and we believe that our local presence and
experience in building a regional champions will be instrumental in developing
a leader in global supply chain solutions. We look forward to continue working
with Xpediator's founder, existing management team and staff to ensure
Xpediator continues on its current growth path."
Commenting on the Offer, Stephen Blyth, Director at Cogels Investments said:
"We are excited to enter this new phase of development for the Xpediator
Group. I initially founded Xpediator in 1988 and was CEO of the business until
May 2020. Cogels strongly feels that a partnership with BaltCap and Justas -
and the expertise and skills which they each bring - will be conducive to
entrepreneurial growth of the Xpediator Group and help capitalise on new
opportunities. We look forward to once again being a part of the Xpediator
Group.
Commenting on the Offer, Justas Veršnickas, Director of Nuoma IR Kapitalas
said:
"Since joining Xpediator, I am incredibly proud of what has been achieved over
the last 13 years, and in particular the success and growth of the Xpediator
Group in the Baltic region. I am looking forward to helping to continue the
operation and growth of the Xpediator Group and working alongside the
Consortium to help accelerate Xpediator's development."
This summary should be read in conjunction with, and is subject to, the full
text of this Announcement and its appendices. The Offer will be subject to
the Conditions and further terms set out in Appendix 1 to this Announcement
and to the full terms and conditions which will be set out in the Scheme
Document. Appendix 2 to this Announcement contains the sources of information
and bases of calculations of certain information contained in this
Announcement. Appendix 3 contains a summary of the irrevocable undertakings
received in relation to this Offer. Appendix 4 contains definitions of certain
expressions used in this summary and in this Announcement.
Enquiries:
Bidco
Šarūnas Alekna
Stephen
Blyth
Tel: +370 5254 6713
Rothschild &
Co
(Financial adviser to Bidco)
Stuart Vincent
Harry
O'Connor
Tel: +44 (0)20 7280 5000
Xpediator
Gillian Wilmot CBE, Interim Chairman
Mike Stone, Interim CEO
Richard Myson,
CFO
Tel: +44 (0)330 043 2395
Zeus Capital
(Financial adviser, Nominated Adviser and corporate broker to Xpediator)
David Foreman
Jamie Peel
James
Hornigold
Tel: +44
(0)20 3829 5000
Novella Communications
(Financial Public Relations to Xpediator)
Tim Robertson
Safia
Colebrook
Tel: +44 (0)20 3151 7008
Travers Smith LLP is providing legal advice to BaltCap and Bidco. Addleshaw
Goddard LLP is providing legal advice to Xpediator.
Important notices
Rothschild & Co, which is authorised and regulated in the United Kingdom
by the FCA, is acting as financial adviser to Bidco and for no one else in
connection with subject matter of this Announcement and will not be
responsible to anyone other than Bidco for providing the protections afforded
to its clients or for providing advice in relation to the subject matter of
this Announcement, the contents of this Announcement or any other matters
referred to in this Announcement. Neither Rothschild & Co nor any of its
affiliates (nor their respective directors, officers, employees or agents)
owes or accepts any duty, liability or responsibility whatsoever (whether
direct or indirect, whether in contract, in tort, under statute or otherwise)
to any person who is not a client of Rothschild & Co in connection with
this Announcement, any statement contained herein, the Offer or otherwise. No
representation or warranty, express or implied, is made by Rothschild & Co
as to the contents of this Announcement.
Zeus Capital Limited, which is authorised and regulated in the United Kingdom
by the FCA, is acting as financial adviser to Xpediator and for no one else in
connection with the Offer and will not be responsible to anyone other than
Xpediator for providing the protections afforded to its clients nor for
providing advice in relation to the Offer, the contents of this Announcement
or any other matters referred to in this Announcement.
Further information
This Announcement is for information purposes only and is not intended to and
does not constitute, or form part of, an offer to sell or an invitation to
purchase any securities or a solicitation of an offer to buy, otherwise
acquire, subscribe for, sell or otherwise dispose of any securities pursuant
to the Offer or otherwise, nor shall there be any purchase, sale, issuance or
exchange of securities or such solicitation in any jurisdiction in which such
offer, solicitation, sale, issuance or exchange is unlawful. The Offer will
be made solely by means of the Scheme Document, or any document by which the
Offer is made, which document will contain the full terms and conditions of
the Offer, including details of how to vote in respect of the Scheme.
If you are in any doubt about the contents of this Announcement or the action
you should take, you are recommended to seek your own independent financial
advice immediately from your stockbroker, bank manager, solicitor, accountant
or from an independent financial adviser duly authorised under the Financial
Services and Markets Act 2000 (as amended).
Xpediator will prepare the Scheme Document to be distributed to Xpediator
Shareholders at no cost to them. Xpediator and Bidco urge Xpediator
Shareholders to read the Scheme Document when it becomes available because it
will contain important information relating to the Offer. Any vote or other
decision in respect of, or other response to, the Offer, should be made only
on the basis of information contained in the Scheme Document or any other
document by which the Offer is made.
Overseas jurisdictions
The release, publication or distribution of this Announcement in jurisdictions
other than the United Kingdom may be restricted by the laws of those
jurisdictions and therefore persons into whose possession this Announcement
comes should inform themselves about and observe such restrictions. Further
details in relation to Overseas Shareholders will be contained in the Scheme
Document. Any failure to comply with any such restrictions may constitute a
violation of the securities laws of any such jurisdiction. To the fullest
extent permitted by applicable law, the companies and persons involved in the
Offer disclaim any responsibility or liability for the violation of such
restrictions by any person.
Unless otherwise determined by Bidco or required by the Takeover Code, and
permitted by applicable law and regulation, the Offer will not be made
available, directly or indirectly, in, into or from a Restricted Jurisdiction
where to do so would violate the laws in that jurisdiction and no person may
vote in favour of the Scheme by any means from within a Restricted
Jurisdiction or any other jurisdiction if to do so would constitute a
violation of the laws of that jurisdiction. Accordingly, copies of this
Announcement and all documents relating to the Offer are not being, and must
not be, directly or indirectly, mailed or otherwise forwarded, distributed or
sent in, into or from a Restricted Jurisdiction where to do so would violate
the laws in that jurisdiction, and persons receiving this Announcement and all
documents relating to the Offer (including custodians, nominees and trustees)
must not mail or otherwise distribute or send them in, into or from such
jurisdictions where to do so would violate the laws in that jurisdiction.
The availability of the Offer to Scheme Shareholders who are not resident in
the United Kingdom may be affected by the laws of the relevant jurisdictions
in which they are resident. Persons who are not resident in the United
Kingdom should inform themselves of, and observe, any applicable requirements.
This Announcement has been prepared in connection with proposals in relation
to a scheme of arrangement pursuant to and for the purpose of complying with
English law and the Takeover Code and information disclosed may not be the
same as that which would have been disclosed if this Announcement had been
prepared in accordance with the laws of jurisdictions outside England. Nothing
in this Announcement should be relied on for any other purpose.
The Scheme will be subject to English law and the jurisdiction of the Court,
and to the applicable requirements of the Takeover Code, the Panel, the London
Stock Exchange (including the AIM Rules), the Financial Conduct Authority and
the Registrar of Companies.
Additional information for US investors
Xpediator Shareholders in the United States should note that the Offer relates
to the securities of a UK company and is proposed to be effected by means of a
scheme of arrangement under English law. This Announcement, the Scheme
Document and certain other documents relating to the Offer have been or will
be prepared in accordance with English law, the Takeover Code and UK
disclosure requirements, format and style, all of which differ from those in
the United States. A transaction effected by means of a scheme of
arrangement is not subject to the tender offer rules or the proxy solicitation
rules under the US Exchange Act. Accordingly, the Offer is subject to the
disclosure requirements of and practices applicable in the United Kingdom to
schemes of arrangement, which differ from the disclosure requirements of the
United States tender offer and proxy solicitation rules. If, in the future,
Bidco exercises the right to implement the Offer by way of a Takeover Offer
and determines to extend the offer into the United States, the Offer will be
made in compliance with applicable United States laws and regulations,
including any applicable exemptions under the US Securities Act or US Exchange
Act.
The Loan Notes have not been, and will not be, registered under the US
Securities Act or with any securities regulatory authority of any state or
other jurisdiction of the United States and may not be offered, sold,
exercised, resold, transferred or delivered, directly or indirectly, in or
into the United States except pursuant to an exemption from the registration
requirements of the US Securities Act. There will be no public offer of Loan
Notes in the United States. Accordingly, the Loan Note Alternative is not
being offered, and will not be offered, directly or indirectly in or into, or
by use of the mails 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. This includes, but is not limited to, facsimile
transmission, electronic mail, telex, telephone, the internet and other forms
of electronic communication. The Loan Note Alternative may not be applied to
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,
materials allowing for the Loan Note Alternative are not being, and must not
be, directly or indirectly mailed or otherwise published, transmitted,
distributed or forwarded (including, without limitation, by custodians,
nominees or trustees) in or into the United States or to any US persons or any
persons located or resident in the United States. Any purported applicability
of the Loan Note Alternative resulting directly or indirectly from a violation
of these restrictions will be invalid and any purported applicability of the
Loan Note Alternative made by a person located in the United States 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 person electing to receive the Loan Note Alternative will represent that
it is not a US person, it is not located in the United States and it is not
participating in the Offer from the United States or acting on a
non-discretionary basis for a principal that is not a US person, it is located
outside the United States and that it is not giving an order to participate in
the Loan Note Alternative from the United States. For the purposes of this and
the above paragraph, "United States" means 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.
Xpediator's financial statements, and all financial information that is
included in this Announcement or that may be included in the Scheme Document,
or any other documents relating to the Offer, have been or will be prepared in
accordance with International Financial Reporting Standards and may not be
comparable to financial statements of companies in the United States or other
companies whose financial statements are prepared in accordance with US
generally accepted accounting principles.
The receipt of cash pursuant to the Offer by a US holder as consideration for
the transfer of its Scheme Shares pursuant to the Scheme will likely be a
taxable transaction for United States federal income tax purposes and under
applicable United States state and local, as well as foreign and other, tax
laws. Each Xpediator Shareholder is urged to consult his independent
professional adviser immediately regarding the tax consequences of the Offer
applicable to him.
It may be difficult for US holders to enforce their rights and claims arising
out of the US federal securities laws, since Bidco and Xpediator are located
in countries other than the US, and some or all of their officers and
directors may be residents of countries other than the US. US holders may
not be able to sue a non-US company or its officers or directors in a non-US
court for violations of US securities laws. Further, it may be difficult to
compel a non-US company and its affiliates to subject themselves to a US
court's judgement.
In accordance with normal UK practice and consistent with Rule 14e-5(b) of the
US Exchange Act, Bidco, certain affiliated companies and their nominees or
brokers (acting as agents) may make certain purchases of, or arrangements to
purchase, shares in Xpediator outside of the US, other than pursuant to the
Offer, until the date on which the Scheme and/ or the Takeover Offer becomes
Effective, lapses or is otherwise withdrawn. If such purchases or
arrangements to purchase were to be made they would occur either in the open
market at prevailing prices or in private transactions at negotiated prices
and comply with applicable law, including the US Exchange Act. Any
information about such purchases or arrangements to purchase will be disclosed
as required in the United Kingdom, will be reported to a Regulatory
Information Service and will be available on the London Stock Exchange website
at www.londonstockexchange.com.
Forward-looking statements
This Announcement (including information incorporated by reference in this
Announcement) and other information published by Bidco, BaltCap, any member of
the Consortium or Xpediator contain statements about Bidco, BaltCap, any
member of the Consortium and Xpediator that are or may be deemed to be forward
looking statements. All statements other than statements of historical facts
included in this Announcement may be forward looking statements. Without
limitation, any statements preceded or followed by or that include the words
"targets", "plans", "believes", "expects", "aims", "intends", "will", "may",
"anticipates", "estimates", "projects" or words or terms of similar substance
or the negative thereof, are forward looking statements. Forward looking
statements include statements relating to the following: (i) future capital
expenditures, expenses, revenues, earnings, synergies, economic performance,
indebtedness, financial condition, dividend policy, losses and future
prospects; (ii) business and management strategies and the expansion and
growth of Bidco's or Xpediator's operations and potential synergies resulting
from the Offer; and (iii) the effects of government regulation on Bidco's or
Xpediator's business.
These forward-looking statements are not guarantees of future performance.
Such forward-looking statements involve known and unknown risks and
uncertainties that could significantly affect expected results and are based
on certain key assumptions. Many factors could cause actual results to
differ materially from those projected or implied in any forward-looking
statements. These factors include, but are not limited to, the satisfaction
of the conditions to the Offer, as well as additional factors, such as changes
in political and economic conditions, changes in the level of capital
investment, retention of key employees, changes in customer habits, success of
business and operating initiatives and restructuring objectives, impact of any
acquisitions or similar transactions, changes in customers' strategies and
stability, competitive product and pricing measures, changes in the regulatory
environment, fluctuations of interest and exchange rates, and the outcome of
any litigation. Due to such uncertainties and risks, readers are cautioned
not to place undue reliance on such forward-looking statements, which speak
only as of the date of this Announcement. All subsequent forward-looking
statements attributable to Bidco, BaltCap, any member of the Consortium or
Xpediator or any of their respective members, directors, officers or employees
or any persons acting on their behalf are expressly qualified in their
entirety by the cautionary statement above. Bidco, BaltCap, any member of
the Consortium and Xpediator disclaim any obligation to update any
forward-looking or other statements contained in this Announcement, except as
required by applicable law.
No profit forecasts or estimates
Except where indicated, no statement in this Announcement is intended as a
profit forecast or estimate for any period and no statement in this
Announcement should be interpreted to mean that earnings or earnings per share
for Xpediator for the current or future financial years would necessarily
match or exceed the historical published earnings or earnings per share for
Xpediator.
Disclosure requirements of the Takeover Code
Under Rule 8.3(a) of the Takeover Code, any person who is interested in 1% or
more of any class of relevant securities of an offeree company or of any
securities exchange offeror (being any offeror other than an offeror in
respect of which it has been announced that its offer is, or is likely to be,
solely in cash) must make an Opening Position Disclosure following the
commencement of the offer period and, if later, following the announcement in
which any securities exchange offeror is first identified. An Opening Position
Disclosure must contain details of the person's interests and short positions
in, and rights to subscribe for, any relevant securities of each of (i) the
offeree company; and (ii) any securities exchange offeror(s). An Opening
Position Disclosure by a person to whom Rule 8.3(a) applies must be made by no
later than 3.30 pm (London time) on the 10th business day following the
commencement of the offer period and, if appropriate, by no later than 3.30 pm
(London time) on the 10th business day following the announcement in which any
securities exchange offeror is first identified. Relevant persons who deal in
the relevant securities of the offeree company or of a securities exchange
offeror prior to the deadline for making an Opening Position Disclosure must
instead make a Dealing Disclosure.
Under Rule 8.3(b) of the Takeover Code, any person who is, or becomes,
interested in 1% or more of any class of relevant securities of the offeree
company or of any securities exchange offeror must make a Dealing Disclosure
if the person deals in any relevant securities of the offeree company or of
any securities exchange offeror. A Dealing Disclosure must contain details of
the dealing concerned and of the person's interests and short positions in,
and rights to subscribe for, any relevant securities of each of (i) the
offeree company; and (ii) any securities exchange offeror(s), save to the
extent that these details have previously been disclosed under Rule 8. A
Dealing Disclosure by a person to whom Rule 8.3(b) applies must be made by no
later than 3.30 pm (London time) on the business day following the date of the
relevant dealing.
If two or more persons act together pursuant to an agreement or understanding,
whether formal or informal, to acquire or control an interest in relevant
securities of an offeree company or a securities exchange offeror, they will
be deemed to be a single person for the purpose of Rule 8.3.
Opening Position Disclosures must also be made by the offeree company and by
any offeror and Dealing Disclosures must also be made by the offeree company,
by any offeror and by any persons acting in concert with any of them (see
Rules 8.1, 8.2 and 8.4).
Details of the offeree and offeror companies in respect of whose relevant
securities Opening Position Disclosures and Dealing Disclosures must be made
can be found in the Disclosure Table on the Takeover Panel's website at
www.thetakeoverpanel.org.uk, including details of the number of relevant
securities in issue, when the offer period commenced and when any offeror was
first identified. You should contact the Panel's Market Surveillance Unit on
+44 (0)20 7638 0129 if you are in any doubt as to whether you are required to
make an Opening Position Disclosure or a Dealing Disclosure.
Right to switch to a Takeover Offer
Bidco reserves the right to elect, with the consent of the Panel, and subject
to the terms of the Co-operation Agreement, to implement the Offer by way of a
Takeover Offer for the entire issued and to be issued ordinary share capital
of Xpediator as an alternative to the Scheme. In such an event, the Takeover
Offer will be implemented on the same terms or, if Bidco so decides, on such
other terms being no less favourable (subject to appropriate amendments), so
far as applicable, as those which would apply to the Scheme and subject to the
amendments referred to in Appendix 1 to this Announcement.
Publication on website
A copy of this Announcement and the documents required to be published
pursuant to Rule 26.1 of the Takeover Code will be available, free of charge,
subject to certain restrictions relating to persons resident in Restricted
Jurisdictions on BaltCap's website at
https://www.baltcap.com/offer-for-xpediator-plc/ and Xpediator's website at
https://www.xpediator.com/offer-for-xpediator-plc/ by no later than 12:00 p.m.
on the Business Day following publication of this Announcement.
For the avoidance of doubt, the contents of these websites and any websites
accessible from hyperlinks on these websites are not incorporated into and do
not form part of this Announcement.
Information relating to Xpediator Shareholders
Please be aware that addresses, electronic addresses and certain information
provided by Xpediator Shareholders, persons with information rights and other
relevant persons for the receipt of communications from Xpediator may be
provided to Bidco during the Offer Period as required under Section 4 of
Appendix 4 of the Takeover Code to comply with Rule 2.11(c) of the Takeover
Code.
Right to receive documents in hard copy form
In accordance with Rule 30.3 of the Takeover Code, Xpediator Shareholders,
persons with information rights and participants in the Xpediator Share Plans
may request a hard copy of this Announcement, free of charge, by contacting
Xpediator's registrars, Share Registrars Limited, by: (i) submitting a request
in writing to Share Registrars Limited, 3 The Millennium Centre, Crosby Way,
Farnham, Surrey, GU9 7XX, United Kingdom; or (ii) calling +44 (0) 1252 821390.
Calls are charged at the standard geographical rate and will vary by provider.
Calls outside the United Kingdom will be charged at the applicable
international rate. Phone lines are open between 9:00 a.m. and 5:00 p.m.
(London time), Monday to Friday (excluding public holidays in England and
Wales). Please note that Share Registrars cannot provide any financial, legal
or tax advice and calls may be recorded and monitored for security and
training purposes.
Such persons may also request that all future documents, announcements and
information in relation to the Offer are sent to them in hard copy form. For
persons who receive a copy of this Announcement in electronic form, a hard
copy of this Announcement will not be sent unless so requested.
Rounding
Certain figures included in this Announcement have been subjected to rounding
adjustments. Accordingly, figures shown for the same category presented in
different tables may vary slightly and figures shown as totals in certain
tables may not be an arithmetic aggregation of the figures that precede them.
NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION IN WHOLE OR IN PART, DIRECTLY OR
INDIRECTLY, IN, INTO OR FROM ANY JURISDICTION WHERE TO DO SO WOULD CONSTITUTE
A VIOLATION OF THE RELEVANT LAWS OF SUCH JURISDICTION.
This announcement contains inside information for the purposes of Article 7 of
the UK version of the Market Abuse Regulation (EU 596/2014) which is part of
UK law by virtue of the European Union (Withdrawal) Act 2018.
THIS ANNOUNCEMENT IS NOT A PROSPECTUS OR PROSPECTUS EXEMPT DOCUMENT AND
XPEDIATOR SHAREHOLDERS SHOULD NOT MAKE ANY DECISION IN RELATION TO THE CASH
OFFER OR THE LOAN NOTE ALTERNATIVE EXCEPT ON THE BASIS OF THE INFORMATION TO
BE CONTAINED IN THE SCHEME DOCUMENT WHICH IS PROPOSED TO BE PUBLISHED IN DUE
COURSE.
FOR IMMEDIATE RELEASE
6 April 2023
RECOMMENDED cash offer
for
Xpediator plc ("Xpediator")
BY
DLM BIDCO LIMITED ("bidco")
a newly incorporated entity to be indirectly owned by (i) funds advised by
BaltCap, (ii) Cogels Investments and (iii) Nuoma IR Kapitalas, as members of
the Consortium
to be implemented by means of a Scheme of Arrangement
under Part 26 of the Companies Act 2006
1. Introduction
The boards of Bidco and Xpediator are pleased to announce that they have
reached agreement on the terms of a recommended cash offer by Bidco, a
newly-incorporated entity to be indirectly owned by the Consortium, to acquire
the entire issued and to be issued ordinary share capital of Xpediator
(excluding the Xpediator Shares owned or controlled by Cogels Investments). As
at the Latest Practicable Date, Cogels Investments owned or controlled
37,260,660 Xpediator Shares, representing approximately 26.30 per cent. of
Xpediator's issued share capital as at such date.
The Offer is intended to be implemented by means of a scheme of arrangement
under Part 26 of the Companies Act.
2. The Offer
Under the terms of the Offer, which will be subject to the Conditions and
further terms set out in Appendix 1 to this Announcement and to be set out in
the Scheme Document, each Scheme Shareholder will be entitled to receive 44
pence for each Scheme Share held (the "Cash Value"), comprising for each
Scheme Share:
42 pence in cash (the "Cash Offer")
and
a special dividend of 2 pence (the "Special Dividend")
If, on or after the date of this Announcement and before the Effective Date,
any dividend, distribution and/or other return of capital is declared, made or
paid or becomes payable in respect of the Xpediator Shares (other than, or in
excess of, the Special Dividend), Bidco reserves the right to reduce the
consideration payable under the terms of the Offer for the Xpediator Shares by
an amount up to the amount of such dividend, distribution and/or return of
capital (or excess, as applicable), excluding any amount in respect of the
Excluded Shares, in which case the relevant eligible Xpediator Shareholders
will be entitled to receive and retain such dividend and/or distribution
and/or return of capital. If Bidco exercises its rights described above, any
reference in this Announcement to the consideration payable under the terms of
the Offer will be deemed to be a reference to the consideration as so reduced.
Any exercise by Bidco of its rights referred to in this paragraph shall be the
subject of an announcement and, for the avoidance of doubt, shall not be
regarded as constituting any revision or variation of the terms of the Scheme.
The Cash Value of 44 pence for each Scheme Share values the entire issued and
to be issued share capital of Xpediator at approximately £62,342,907, and
represents a premium of approximately:
· 45.5 per cent. to the Closing Price of 30.3 pence
per Xpediator Share on 19 December 2022 (being the last Business Day before
the date of the commencement of the Offer Period);
· 18.9 per cent. to the Closing Price of 37.0 pence
per Xpediator Share on 5 April 2023 (being the last Business Day before the
date of this Announcement); and
· 79.7 per cent. to the volume weighted average
Closing Price of 24.5 pence per Xpediator Share for the three-month period
ended 19 December 2022.
Under the terms of the Offer, a Loan Note Alternative will be available to
Scheme Shareholders (other than Scheme Shareholders resident or located in a
Restricted Jurisdiction, including the United States), which will enable
eligible Scheme Shareholders to elect to receive Loan Notes in lieu of part or
all of the cash consideration to which they would otherwise be entitled under
the terms of the Offer. Further details in relation to the Loan Note
Alternative are set out in paragraph 10 below.
The Xpediator Directors intend to declare and pay the Special Dividend of 2
pence per Xpediator Share to Xpediator Shareholders on the register of members
of Xpediator at the Scheme Record Time. The Special Dividend is conditional
upon, and only payable if, the Scheme becomes Effective (or, if the Offer is
implemented by way of a Takeover Offer, the Takeover Offer is declared
unconditional in all respects). Further details are set out in paragraph 18 of
this Announcement.
The Xpediator Shares owned or controlled by Cogels Investments (being
37,260,660 Xpediator Shares as at the Latest Practicable Date) will not be
Scheme Shares and will not be acquired by Bidco pursuant to the Offer. Upon
the Offer becoming Effective, Cogels Investments will: (i) indirectly
contribute 36,299,777 Xpediator Shares owned or controlled by it (representing
approximately 25.62 per cent. of Xpediator's issued share capital on the
Latest Practicable Date) to Bidco; and (ii) sell 960,883 Xpediator Shares
owned or controlled by it (representing approximately 0.68 per cent. of
Xpediator's issued share capital on the Latest Practicable Date) to Bidco in
exchange for cash at the same price per Xpediator Share as the Cash Offer.
Cogels Investments and the Blyth Family Members will not be permitted to vote
the Xpediator Shares owned or controlled by them at the Court Meeting, but
will be permitted to vote such Xpediator Shares at the General Meeting.
Notwithstanding the fact that the Blyth Family Members will not be permitted
to vote their Xpediator Shares at the Court Meeting, each of the Blyth Family
Members have undertaken for their Xpediator Shares to be bound by the terms of
the Scheme.
It is expected that the Scheme Document will be published as soon as
practicable and, in any event, within 28 days of this Announcement (unless the
Panel agrees otherwise). It is currently expected that the Scheme will become
Effective in the third quarter of 2023.
3. Background to and reasons for the Offer
BaltCap
For the last 25 years, BaltCap has been one of the most active investors
throughout the Baltic region, and since inception has invested in around 100
companies across the CEE. BaltCap's investment criteria are focused on
businesses that seek to evolve and develop with significant upside potential,
especially in their growth profile and stature, something demonstrated by
Xpediator over the last few years. BaltCap believes with the combination of
its financial resources, relevant experience and in-depth knowledge of
Xpediator's end markets, Xpediator will be able to successfully grow in the
future years to come.
BaltCap intends to support Xpediator's management in its efforts to continue
to grow its core freight forwarding offering in the CEE region and
internationally, while also providing expertise to improve operating
efficiencies and overhead costs in the UK based businesses.
BaltCap believes that, following the Effective Date, it will be able to
support Xpediator as it continues to deliver on its strategic objectives,
focuses on growing its core freight forwarding activities in the CEE region
and will help input to strategic options for logistics operations in the UK
and Romania.
In addition, BaltCap's access to patient capital will provide the business
with the financial backing required to accelerate its growth both organically
and through targeted bolt-on acquisitions.
Cogels Investments
Cogels Investments believes partnering with BaltCap to leverage the parties
combined expertise will enable Xpediator to resolve operational and financial
issues in the UK and execute its growth strategy in the CEE region more
efficiently and effectively as a private company.
Furthermore, one of Xpediator's primary growth markets is the Baltic region
and Cogels Investments believes that partnering with a well renowned private
equity firm in the region will enable Xpediator to accelerate its growth in
the region and open up new organic and inorganic growth opportunities
previously unavailable.
Nuoma IR Kapitalas
Nuoma IR Kapitalas is the private investment vehicle of Justas Veršnickas. As
the managing director and 20 per cent. shareholder of Delamode Baltics UAB, a
subsidiary of Xpediator, Justas has a significant role and influence over the
success of Xpediator in the Baltic region.
Justas Veršnickas will play a leading role in the operation and growth of
Xpediator, especially of its freight forwarding division, and the Offer
facilitates an alignment of interest between the key stakeholders within the
Consortium.
The Consortium
The members of the Consortium are committed to accelerating Xpediator's
development at this important juncture for the business and believe taking
Xpediator private will enable it to pursue additional growth opportunities
where its people will become part of an exciting platform in the UK and
internationally.
4. Recommendation
The Xpediator Directors, who have been so advised by Zeus Capital as to the
financial terms of the Offer, consider the terms of the Offer to be fair and
reasonable. In providing advice to the Xpediator Directors, Zeus Capital has
taken into account the commercial assessments of the Xpediator Directors. Zeus
Capital is providing independent financial advice to the Xpediator Directors
for the purposes of Rule 3 of the Takeover Code.
Accordingly, the Xpediator Directors intend to recommend unanimously that
Scheme Shareholders vote in favour (or procure votes in favour) of the Scheme
at the Court Meeting and Xpediator Shareholders vote in favour (or procure
votes in favour) of the Resolution(s) at the General Meeting as all Xpediator
Directors holding Xpediator Shares as at the date of this Announcement have
irrevocably undertaken to do (or procure to be done) in respect of their own
holdings totalling 2,008,677 Xpediator Shares, representing approximately 1.93
per cent. of Scheme Shares entitled to vote at the Court Meeting and 1.42 per
cent. of the issued share capital of Xpediator as at the Latest Practicable
Date.
5. Background to and reasons for the
recommendation
Since the initial public offering ("IPO") of Xpediator in August 2017,
Xpediator has undergone a period of significant transformation and growth.
Xpediator's revenues have grown from £116 million for the financial year
ended 31 December 2017 to just below £400 million (unaudited) in FY22 with
strong profit growth through that period.
A key reason for Xpediator's IPO was the belief of its then board of
directors, that the enhanced public profile, access to capital and ability to
use Xpediator's shares as an acquisition currency would enable it to grow more
quickly, both through organic growth and through acquisitions.
Xpediator has completed four UK acquisitions since its IPO. Whilst these have
collectively contributed to the significant revenue growth of the Xpediator
Group, in aggregate, they have not contributed materially to Xpediator
profitability in FY22 and furthermore, have absorbed working capital. This was
a contributing factor to a deterioration in the net debt of Xpediator Group,
reaching £8.0 million as at 30 June 2022.
Xpediator's market capitalisation increased from £24 million at the time of
its IPO to £43 million on 19 December 2022, the last business day before
Xpediator announced it had received an indicative proposal from the Consortium
in respect of a possible offer.
The Xpediator Directors believe the improving financial and operational
performance and outlook of the Xpediator Group has not been reflected in the
Company's share price, with a significant de-rating in Xpediator's valuation
experienced over the last 12 months against a backdrop of expected record
results in FY22, including a significant reduction in the net debt figure from
that announced at the Company's interim results for the six months ended 30
June 2022. Whilst this is in part reflective of the wider AIM All-Share
performance, the volatility in Xpediator's share price, and recent share price
under performance, substantially restrict the Xpediator Directors ability to
use Xpediator Shares as acquisition currency in the short term, which was a
key tenet for Xpediator's IPO in 2017.
The Xpediator Directors remain confident in Xpediator's ability to continue to
grow on AIM, but are mindful of the weakening macro-economic outlook in the UK
and Europe. While the Xpediator Directors believe that Xpediator's present
strategy and opportunities are robust and capable of delivering mid to
long-term growth and profitability, they also believe that the terms of the
Offer provide Xpediator Shareholders with an immediate, certain and
appropriate cash value at this time. The Xpediator Directors have taken into
account the current trading of the business, announced separately on 2
February 2023, and as further described above, in considering their
recommendation and believe the Offer appropriately recognises the short term
prospects of the Xpediator Group as a standalone business in the current and
likely continuing challenging macro-economic climate.
Whilst the Xpediator Directors believe there is value to remaining on AIM, on
balance, and considering inter alia, the risks set out in this paragraph 5,
the Xpediator Directors are recommending the Offer to Xpediator Shareholders.
In particular, the Xpediator Directors note the potential risks of Xpediator
losing key geographic markets and/or losing senior management or other key
personnel in the Group including, in particular, in Delamode Baltics UAB, the
most profitable entity of the Xpediator Group, should the Offer not proceed.
Such losses would likely have a significant adverse impact on the financial
performance and prospects of the Xpediator Group. This risk, combined with
what the Xpediator Directors perceive as the high probability of multiple
Board changes in the near term should the Offer not proceed, which could cause
disruption to the business, supports the Directors' recommendation.
The Xpediator Directors also recognise that the very limited liquidity of
Xpediator Shares makes it challenging for Xpediator Shareholders to monetise
their holdings should they so wish. The Offer provides the opportunity for
Xpediator Shareholders to realise their entire investment at an acceptable
valuation at this time in cash. Should the Offer not proceed for any reason,
there could then be a sustained period of share price volatility, in
particular if Xpediator's three largest shareholders, Cogels, Shaun Godfrey
and Sandu Grigore, who have each independently indicated their support for the
Offer, subsequently choose to exit their shareholdings.
Based on the value of the Offer of 42 pence in cash per Xpediator Share
combined with the Special Dividend of 2 pence per Xpediator Share, the Cash
Value represents a premium of approximately:
- 45.5 per cent. to the Closing Price of 30.3 pence per
Xpediator Share on 19 December 2022 (being the last Business Day before the
date of the commencement of the Offer Period);
- 18.9 per cent. to the Closing Price of 37.0 pence per
Xpediator Share on 5 April 2023 (being the last Business Day before the date
of this Announcement);
- 61.2 per cent. to the volume weighted average Closing Price of
27.3 pence per Xpediator Share for the one-month period ended 19 December
2022;
- 79.7 per cent. to the volume weighted average Closing Price of
24.5 pence per Xpediator Share for the three-month period ended 19 December
2022; and
- 21.3 per cent. to the volume weighted average Closing Price of
36.3 pence per Xpediator Share for the twelve-month period ended 19 December
2022.
In addition to the financial terms of the Offer, in their evaluation of Bidco
as a suitable owner of Xpediator from the perspective of all stakeholders, the
Xpediator Directors have also taken into account Bidco's intentions for the
business, as set out in paragraph 9 below, regarding the strategic plans for
the Xpediator Group, as well as the importance that Bidco places on the depth
of skillset, expertise and experience of the existing management and employees
of the Xpediator Group. Subject to the potential headcount reductions
described in paragraph 9 below, the Xpediator Directors acknowledge Bidco's
statements that certain employees of the Xpediator Group may benefit from
potential new opportunities within the Xpediator Group that arise as a result
of the planned growth of Xpediator's core freight forwarding offering. The
Xpediator Directors accept Bidco's stated intention to undertake a detailed
review of certain non-freight forwarding businesses (which might include
Delamode Romania SRL, Pallex Express NRL and Affinity) and also Xpediator's UK
logistics operations, for which reductions in headcount are possible,
following completion of the Offer. The Xpediator Directors also note Bidco's
intention to safeguard the existing contractual and statutory employment
rights of employees and management of the Xpediator Group, including regarding
pensions, following completion of the Offer.
Accordingly, the Xpediator Directors intend to recommend unanimously that
Scheme Shareholders vote in favour of the Scheme at the Court Meeting and that
Xpediator Shareholders vote in favour of the Resolution(s) to be proposed at
the General Meeting.
6. Irrevocable undertakings
In addition to the irrevocable undertakings from Xpediator Directors and the
recommendation by all of the Xpediator Directors, described in paragraph 4
above, Bidco has received irrevocable undertakings from Shaun Godfrey, Sandu
Grigore and Frances Lee to vote in favour of the Scheme at the Court Meeting
and to vote in favour of the Resolution(s) at the General Meeting in respect
of a total of 38,501,484 Xpediator Shares representing approximately 37.1 per
cent. of Scheme Shares entitled to vote at the Court Meeting and 27.2 per
cent. of the issued share capital of Xpediator as at the Latest Practicable
Date. Bidco has also received irrevocable undertakings from each of the Blyth
Family Members and Cogels Investments to vote in favour of the Resolution(s)
at the General Meeting in respect of a total of 37,781,045 Xpediator Shares
representing approximately 26.7 per cent. of the issued share capital of
Xpediator as at the Latest Practicable Date.
Therefore, as at the date of this Announcement, Bidco has received irrevocable
undertakings to vote in favour of the Scheme at the Court Meeting in respect
of a total of 38,501,484 Xpediator Shares representing approximately 37.1 per
cent. of Scheme Shares entitled to vote at the Court Meeting and to vote in
favour of the Resolution(s) at the General Meeting in respect of a total of
76,282,529 Xpediator Shares representing approximately 53.8 per cent. of the
issued share capital of Xpediator as at the Latest Practicable Date.
In addition, each of the irrevocable undertakings received from Shaun Godfrey
and Sandu Grigore include an undertaking to accept the Loan Note Alternative
with regard to part of the Scheme Shares held by them, as further detailed
below:
· from Shaun Godfrey to accept the Loan Note
Alternative in respect of 18,147,009 Xpediator Shares owned or controlled by
him, representing approximately 12.8 per cent. of the issued share capital of
Xpediator as at the Latest Practicable Date, or such lesser amount as notified
to them by Bidco; and
· from Sandu Grigore to accept the Loan Note
Alternative in respect of 12,629,200 Xpediator Shares owned or controlled by
him, representing approximately 8.9 per cent. of the issued share capital of
Xpediator as at the Latest Practicable Date, or such lesser amount as notified
to them by Bidco.
Full details of these irrevocable undertakings are set out in Appendix 3 to
this Announcement.
7. Information on Bidco and the Consortium
The Consortium is comprised of funds advised by BaltCap, Cogels Investments
and Nuoma IR Kapitalas. Cogels Investments and funds advised by BaltCap are
joint offerors with respect to the Offer.
Bidco
Bidco is a limited company registered in England and Wales and incorporated on
23 February 2023. Bidco was formed for the purposes of the Offer and has not
traded since its date of incorporation, nor has it entered into any
obligations other than in connection with the Offer. Bidco is ultimately owned
by Holdco. As at the Effective Date, it is intended that Holdco will be owned
in the following proportions: (i) funds advised by BaltCap will indirectly own
40 per cent. of Holdco; (ii) Cogels Investments will own 34 per cent. of
Holdco; and (iii) Nuoma IR Kapitalas will indirectly own 26 per cent. of
Holdco. The funds advised by BaltCap and Nuoma IR Kapitalas will hold their
interest in Holdco through Lithuanian Newco, being a joint venture vehicle
formed for the purposes of the Offer.
BaltCap
BaltCap is a multi-strategy private equity and venture capital investor in the
Baltic states of Estonia, Latvia and Lithuania, covering buyout, growth,
venture as well as infrastructure investments, serving institutional investors
from around the world. It was founded in 1995 and its private equity funds
have since invested in approximately one hundred companies across a wide range
of industry sectors and stages of development. BaltCap will invest in the
Lithuanian Newco through BaltCap Private Equity Fund III usaldusfond and its
co-investment fund, BPEF III Supplementary Investment Facility usaldusfond, a
€177 million (including co-investment facility) fund focused on mature
enterprises in the Baltics and Nordics.
Cogels Investments
Cogels Investments is a private investment entity through which the close
relatives of Stephen Blyth, the former CEO and founder of Xpediator, invest in
businesses across a range of sectors including consultancy, hospitality,
leisure and real estate.
Nuoma IR Kapitalas
Nuoma IR Kapitalas is the private investment vehicle of Justas Veršnickas,
the managing director of Delamode Baltics UAB, a subsidiary of Xpediator.
Justas Veršnickas owns 20 per cent. of the issued share capital of Delamode
Baltics UAB, but is not an Xpediator Shareholder.
8. Information on Xpediator
Xpediator is an international freight management company, headquartered in the
UK that provides logistics and transport support solutions. Xpediator is
committed to providing dynamic supply chain solutions and innovation within a
global market, focusing on outstanding quality and customer care excellence.
The original business, trading as "Delamode", was established in 1988 and was
initially focused on providing freight forwarding services to and from the UK.
The Xpediator Group has since evolved into an integrated freight management
business, with well-established and successful customs clearance, multi-modal
transport, storage, fulfilment and distribution operations in its key markets
in the UK and Europe, with specific expertise in CEE countries.
In August 2017, the shares of Xpediator were admitted to trading on AIM.
The Xpediator Group currently employs over 1,500 people across the UK,
Bulgaria, Lithuania, Estonia, Macedonia, Montenegro, Moldova, Romania and
Serbia, operating from over 35 sites in these and other countries.
Xpediator operates through three divisions: (i) Freight Forwarding; (ii)
Warehousing & Logistics; and (iii) Transport Support Services, which are
further detailed below.
Freight Forwarding is operated predominantly under the Delamode brand and the
division provides end-to-end domestic and international freight management
services via road, air and sea, connecting CEE countries and the UK with each
other and the rest of Europe. In some key markets, it also operates customised
solutions that allow customers to meet specific product, end customer or local
market requirements.
The Warehousing & Logistics division provides warehousing services.
Xpediator's warehousing capacity is primarily located in the UK, Romania and
Bulgaria, with operations more recently established in the Netherlands as a
result of customer demand arising from Brexit. The logistics network between
the UK and western Europe is a port-centric model, with warehouses located
near the major ports of Southampton, Antwerp and Rotterdam, but are linked
with dedicated road transport shuttles and to customs clearance and transport
operations covering all major airports in their respective regions. The
Romanian logistics operation operates from sites in Bucharest and Constanta,
the major port on the Black Sea. All Xpediator Group logistics sites provide a
comprehensive range of services covering customs clearance, storage, contract
logistics and e-commerce fulfilment, distribution and returns handling. In
addition, Xpediator Group is also the master franchisee of the Romanian pallet
distribution network, trading under the Pall-Ex brand, and operated from its
base in Sibiu.
Transport Support Services, trading under the Affinity brand, provides
hauliers across Europe with an extensive range of services including bundled
fuel and toll cards, financial and support services. In addition, Affinity
provides a "one stop shop" of transport services, including roadside
assistance, ferry bookings and VAT and other tax refunds.
For the year ended 31 December 2021, Xpediator reported audited revenues of
£296.6 million (2020: £221.2 million) and adjusted profit before tax of
£9.1 million (2020: £7.2 million). For the six months ended 30 June 2022,
Xpediator reported revenues of £189.3 million (H1 2021: £126.6 million) and
adjusted profit before tax of £3.1 million (H1 2021: £3.6 million). During
the same period, net cash deteriorated from £6.8 million at 31 December 2020
to net debt of £4.8 million at 31 December 2021 and £8.0 million at 30 June
2022.
Current trading
On 2 February 2023, Xpediator announced a trading update for the year ended 31
December 2022. Against a challenging macro-economic backdrop, Xpediator
continued to trade strongly during the final quarter of the year, announcing
full year revenue being just below £400 million and a material improvement in
net debt to approximately £3.6 million, mainly the result of positive trading
and better cost control (including reduced central costs and overheads
following the unbundling of the shared services centre implemented in the UK
in 2021). As also announced on 2 February 2023, Xpediator's adjusted profit
before tax for the year ended 31 December 2022 is expected to be significantly
ahead of previous management guidance of £9.0 million (unaudited). This
profit statement constitutes a profit estimate for the purposes of Rule 28 of
the Takeover Code. The Scheme Document will include the relevant reports
required by Rule 28.1 of the Takeover Code in connection with such estimate.
The strong trading result stemmed from the continuing outperformance from the
freight forwarding operations in Lithuania, in the closing months of 2022. In
the UK, the financial performance of Delamode Anglia also improved in the
latter months of the year.
The Warehousing & Logistics division also delivered a satisfactory result
after a slow start in 2022 with a good contribution from Pall-ex Romania,
helped by better results in the UK logistics division in the last quarter of
the year. This trend will further benefit from the closure in February 2023 of
the loss-making Beckton warehouse, which specialised in high street fashion
retail, as well as productivity improvements in Southampton and recent
customer wins at the Braintree warehouse.
Mike Stone, who is serving in an interim capacity as Xpediator's CEO, is
intending to step down from his role of interim CEO and from the board of
directors of Xpediator before the Offer completes. Such decision to step down
is unconnected with the Offer but is to allow Mike to pursue other interests.
9. Management, employees and locations
Strategic review
Bidco has drawn on Stephen Blyth's and Justas Veršnickas' knowledge and
understanding of the Xpediator business in order to formulate its strategic
rationale for the Offer, and, shortly following completion of the Offer,
intends to work with Xpediator's management team over a period of up to nine
months to review Xpediator's business, operations and strategy further. As
part of such review, Bidco will conduct strategic reviews of each individual
business unit, with a primary focus on the areas set out below.
A. CEE
As described in paragraph 3 (Background to and reasons for the Offer), Bidco
believes that freight forwarding is core to the continued success of the
Xpediator business and expects to continue to expand this core offering across
the CEE region. Bidco intends to undertake specific strategic reviews across
the CEE region to identify potential non-core activities and assess the
strategic options available to it in the context of long-term growth and
profitability. The strategic reviews will determine whether certain
non-freight forwarding businesses (which might include Delamode Romania SRL,
Pallex Express SRL and Affinity) are a core or non-core part of the future
strategy.
B. UK logistics
The Xpediator Directors have already taken the strategic decision not to renew
the existing lease for the loss-making site at Beckton. Bidco understands that
the Xpediator Directors continue to consider various strategic initiatives to
improve the financial performance of Braintree (from a Group perspective)
which may include the subletting of part or all of the site at Braintree. As
part of its review, Bidco will assess any underlying performance issues at
Braintree before making any strategic decisions, including in relation to the
potential subletting of Braintree.
C. Group overheads
Bidco does not intend to reduce central overheads headcount but will continue
Xpediator management's on-going review of the Xpediator Group's overheads with
a view to re-organising and optimising such overheads across the Xpediator
Group. Bidco will seek to ensure that the workforce in each of Xpediator's
business units is an appropriate size for the business in the context of
securing long-term growth and profitability. As part of this assessment, Bidco
understands from executive management that no staff undertake public company
related roles. To the extent there are any public company related roles being
wholly or substantially performed, Bidco may seek to reduce headcount in
relation to these roles.
Employees and management
Bidco attaches great importance to the depth of skillset, expertise and
experience of the existing management and employees of the Xpediator Group.
Bidco anticipates that certain employees of the Xpediator Group will have the
opportunity to benefit from potential new opportunities within the Xpediator
Group that may arise as a result of the planned growth of Xpediator's core
freight forwarding offering.
It is not expected that the Offer will result in any material headcount
reduction across the freight forwarding operation. As stated above, the
strategic review may result in the disposal or closure of non-core,
underperforming or loss-making assets in the logistics operations. The
logistics operations currently employ approximately a third of the Xpediator
Group's workforce and the Xpediator Group's overall headcount would
accordingly reduce as a result of any business disposals or closures, although
it would be expected that the relevant employees would transfer with any
business which was sold.
Depending on the conclusions reached following the strategic review of
Xpediator's UK logistics operations, the underperforming nature of Braintree
and Southampton may also result in a reduction in headcount to an appropriate
level. Any headcount reduction at Braintree or Southampton is not expected to
be material in the context of the wider Xpediator Group but may be material in
respect of the UK.
The ongoing review of the Xpediator Group's overheads, as currently being
conducted by the Company, will be continued by Bidco and may also result in
some non-material headcount reduction, particularly in the United Kingdom.
Additionally it is expected that certain corporate and support functions may
no longer be required once the Offer for Xpediator has been completed.
The evaluation, preparation, finalisation and implementation of any headcount
reductions will be subject to comprehensive planning and engagement with
Xpediator's management team as part of Bidco's strategic review and all
necessary information and consultation with employees and employee
representatives required by applicable local law. It is also possible that any
headcount reductions may be reduced by natural attrition in the Xpediator
Group employee base. Bidco will also consider, where possible, how individuals
in affected roles may potentially be reassigned to other appropriate roles
within the Xpediator Group.
It is expected that each of the non-executive Xpediator directors will resign
from their office as a director of Xpediator on or shortly after the Effective
Date, on terms to be agreed. Richard Myson, Xpediator's Chief Financial
Officer, has been asked to stay on with the business, as Chief Financial
Officer, on terms to be agreed with him following the Effective Date. It is
expected that Justas Veršnickas' will lead the freight forwarding business
line across the Xpediator Group following the Effective Date.
Save as set out above, Bidco does not intend to make any material change in
the balance of skills and functions of employees and management of Xpediator.
Existing employment rights and pensions
Bidco intends to fully safeguard the existing employment rights of the
management and employees of Xpediator, including in relation to pensions, in
accordance with applicable law and does not intend to make any material change
in the conditions of employment of the management and employees of the
Xpediator Group, unless otherwise agreed with the relevant employees. Bidco
does not intend to make any changes to the agreed employer contributions into
Xpediator's existing defined contribution pension schemes or the admission of
new members to such pension schemes following the Effective Date.
Management incentivisation arrangements
Bidco intends to review the incentive structure of Xpediator following the
Effective Date. Save as set out below, Bidco has not entered into, and has not
discussed, any form of incentivisation arrangements with, members of the
Xpediator management team or other employees, but may put in place incentive
arrangements for certain members of Xpediator's management team following the
Effective Date.
There have been limited discussions between Bidco and Richard Myson regarding
the possibility of Richard re-investing some or all of his proceeds from the
Offer into Holdco following the Effective Date. Such discussions have not
reached an advanced stage and there is no agreement in principle between the
parties.
Headquarters, locations and fixed assets
BidCo does not intend to relocate the location of Xpediator's headquarters. As
part of the review referred to above, following the Effective Date, Bidco will
review Xpediator's sites, offices and places of business. Subject to this
review, Bidco may relocate certain head office functions and UK back-office
support functions to the Baltic region, in line with Bidco's focus to continue
to grow its core freight forwarding offering in the CEE region. The
re-organisation and optimisation of overheads across the Xpediator Group (as
referred to above) may also result in the transfer of certain roles to other
existing locations.
Pending the outcome of its strategic review of Xpediator's sites, offices and
places of business following the Effective Date, Bidco does not currently have
any intentions to redeploy any of Xpediator's fixed assets.
Research and development
As far as Bidco is aware, Xpediator does not have a material research and
development function and, therefore, Bidco has no plans in this regard.
Trading facilities
Xpediator is currently admitted to trading on AIM. As set out in paragraph 17,
it is intended that an application will be made to the London Stock Exchange
for the cancellation of the admission to trading of Xpediator Shares on AIM,
on the Business Day following the Effective Date.
No statements in this paragraph 9 constitute "post-offer undertakings" for the
purposes of Rule 19.5 of the Takeover Code.
10. Loan Note Alternative
Under the Loan Note Alternative, eligible Scheme Shareholders may elect in
respect of all or part of their Scheme Shares to receive Loan Notes in lieu of
part or all of the cash consideration to which they would otherwise be
entitled under the terms of the Cash Offer. The Loan Note Alternative will be
made available on the basis of £1.00 nominal value for every £1.00 of cash
to which a Scheme Shareholder would otherwise be entitled. To the extent
that any Loan Note Alternative elections cannot be satisfied in full, they
will be scaled down on a pro-rata basis. As a result, Scheme Shareholders who
make an election under the Loan Note Alternative will not necessarily know the
exact number of Loan Notes they will receive until the settlement of the
consideration due to them under the Offer.
The eligibility criteria for Scheme Shareholders to be able to elect for the
Loan Note Alternative will be set out in the Scheme Document.
Loan Note Alternative Maximum
The maximum aggregate value of the Loan Notes available to eligible Scheme
Shareholders under the Loan Note Alternative will be £27,795,314 (the "Loan
Note Alternative Maximum"). If elections are validly received from eligible
Scheme Shareholders in respect of a number of Scheme Shares that would require
the issue of Loan Notes with an aggregate value exceeding the Loan Note
Alternative Maximum, such elections will be unable to be satisfied in full. In
these circumstances, the number of Scheme Shares each Scheme Shareholder is
entitled to exchange for Loan Notes will be reduced on a pro-rata basis, and
the balance of the consideration for each Scheme Share will be paid in cash in
accordance with the terms of the Cash Offer.
Other information on the Loan Note Alternative
Unless otherwise determined by Bidco and permitted by applicable law and
regulation, the Loan Note Alternative will not be offered, sold or delivered,
directly or indirectly, in or into any Restricted Jurisdiction and individual
elections for the Loan Note Alternative will only be valid if all regulatory
approvals (if any) required by a Scheme Shareholder to acquire the Loan Notes
have been obtained.
For the purposes of Rule 24.11 of the Takeover Code, an estimate of the value
of the Loan Notes will be provided by Rothschild & Co and included in the
Scheme Document.
If the Scheme becomes Effective, Scheme Shareholders who do not validly elect
to receive all or part of their consideration by means of the Loan Note
Alternative will automatically receive the full amount of the cash
consideration for their entire holding of Scheme Shares.
If the Scheme becomes Effective, eligible Scheme Shareholders that validly
elect to receive consideration by means of the Loan Note Alternative will
receive Loan Notes issued by Midco 1. Such Loan Notes will be issued pursuant
to a roll-over mechanism in the Scheme pursuant to which, on or shortly
following the Effective Date, such elected number of Scheme Shares will be
automatically exchanged for loan notes to be issued by Bidco, which will
ultimately be exchanged for the relevant number of Loan Notes to which the
eligible Scheme Shareholders are entitled in accordance with the Loan Note
Alternative.
Summary of Loan Notes
A summary of the key rights and restrictions attaching to the Loan Notes will
be set out in the Scheme Document. As an overview, the Loan Notes will be
subject to the following terms and conditions:
· The Loan Notes will be governed by English law and will be issued by
Midco 1, credited as fully paid, in amounts and integral multiples of £1.00
and any entitlement that is not a whole multiple of £1.00 will be rounded
down to the nearest £1.00 and the balance of the consideration disregarded
and not paid. The Loan Notes will constitute direct, unsecured and
subordinated obligations of Midco 1.
· The Loan Notes will bear interest payable 12 months in arrears at a
rate of 8 per cent. per annum.
· Midco 1 may at any time on prior written notice on or after the date
which is one year after the issue of the Loan Notes, redeem some or all of the
Loan Notes. The holders of Loan Notes will have the right to elect to be
repaid 18.75 per cent. of their outstanding Loan Notes on or before 30
September 2024, with the exact repayment date being subject to the
determination of Midco 1. Unless previously redeemed or repaid, the Loan Notes
shall mature three years after the issue of the Loan Notes.
· The Loan Notes will not be transferable other than to certain
connected persons and trusts of the holders of Loan Notes.
· The rights and obligations of the holders of Loan Notes will be
subject in all respects to the provisions of any intercreditor agreement and
financing documents entered into for the purposes of refinancing any financial
indebtedness of any member of the Bidder Group, including, but not limited to,
the ability of Midco 1's subsidiaries to provide funds to Midco 1 to be
applied by Midco 1 in satisfaction of any payment obligation in respect of the
Loan Notes.
· No application has been made, or will be made, for the Loan Notes to
be listed or dealt in on any stock exchange.
11. Xpediator Share Plans
Participants in the Xpediator Share Plans will be contacted regarding the
effect of the Offer on their rights under the Xpediator Share Plans. Since all
outstanding options that have been granted under the Xpediator Share Plans
have an exercise price which is greater than the Cash Value per Scheme Share,
no formal proposals will be made to such participants in respect of their
options under Rule 15 of the Takeover Code. Further details of the impact of
the Offer on those options will be set out in the Scheme Document and in
separate letters to be sent to the participants in the Xpediator Share Plans
in due course.
12. Financing of the Cash Offer
The cash consideration payable to Xpediator Shareholders pursuant to the Cash
Offer will be financed by Bidco through a combination of:
· equity investment into Lithuanian Newco to be
invested by BaltCap Private Equity Fund III usaldusfond, BPEF III
Supplementary Investment Facility usaldusfond and Nuoma IR Kapitalas; and
· the issue of convertible bonds by Holdco to BaltCap
Private Equity Fund III usaldusfond and BPEF III Supplementary Investment
Facility usaldusfond in an aggregate amount of EUR 16,966,347 (the
"Convertible Bond").
Rothschild & Co, in its capacity as the financial adviser to Bidco, is
satisfied that sufficient resources are available to Bidco to enable it to
satisfy in full the cash consideration payable to Xpediator Shareholders under
the terms of the Offer.
Further information on the financing of the Offer will be set out in the
Scheme Document.
13. Deferred Shares
Xpediator has in issue 50,000 Deferred Shares. The Deferred Shares are not
listed on any exchange and have limited rights. The Deferred Shares have no
right to participate in any dividends declared, made or paid by Xpediator
(including, for the avoidance of doubt, the Special Dividend), but have the
right to participate on a return of assets in a winding up of Xpediator by a
repayment of the capital paid up on such Deferred Share after the rights of
all holders of Xpediator Shares have been discharged in full and a sum of
£10,000 has been paid in respect of each Xpediator Share. Holders of Deferred
Shares have no other rights to participate in the assets of Xpediator.
The Deferred Shares do not confer on their holders any right to receive notice
of, attend, or vote at general meetings of Xpediator (unless a resolution to
vary or abrogate the rights attaching to the Deferred Shares is being proposed
thereat).
Accordingly, the Deferred Shares do not constitute "equity share capital" for
the purposes of the Takeover Code and the Deferred Shares will not form part
of the Offer and the Scheme and no comparable offer under Rule 14 of the
Takeover Code will be made for the Deferred Shares. Bidco and Xpediator intend
for the Deferred Shares to be cancelled or transferred to Bidco in accordance
with the transfer provisions set out in the Articles on or shortly following
the Effective Date.
14. Offer-related arrangements and Consortium
agreements
Confidentiality Agreement
On 24 June 2022, BaltCap, Cogels Investments and Xpediator entered into a
confidentiality agreement (the "Confidentiality Agreement"), pursuant to which
each of them has undertaken to keep, and to procure that certain of its
connected persons and representatives keep, confidential and safeguard
information relating to Xpediator and/or to the Offer, to use such information
solely for the agreed purposes in relation to the Offer and not to disclose it
to third parties (with certain exceptions). For the avoidance of doubt, the
provisions of the Confidentiality Agreement do not apply to any information
which is provided to BaltCap (or any of its connected persons) by Cogels
Investments (or any of its connected persons), or vice versa. These
confidentiality obligations will remain in force until the earlier of
(i) eighteen months from the date of the Confidentiality Agreement (i.e. 24
December 2023); and (ii) the Effective Date.
The Confidentiality Agreement also contains undertakings from each of BaltCap
and Cogels Investments that, for a period of twelve months from the date of
the Confidentiality Agreement, without the prior written consent of Xpediator,
neither of them shall: (i) make or have any contact with any person who is,
or during the negotiations becomes, a customer or supplier of Xpediator or one
of its group undertakings, unless in the ordinary course of their existing
business unconnected with the Offer, provided that such ordinary course
discussions do not seek to solicit or entice away certain of Xpediator's
suppliers or customers; and (ii) employ, offer to employ, solicit for
employment or endeavour to entice away certain of the directors, officers or
senior managers of Xpediator or one of its group undertakings.
Co-operation Agreement
On 5 April 2023, Xpediator, Bidco, Cogels Investments, Nuoma IR Kapitalas,
Justas Veršnickas, Baltcap Private Equity Fund III usaldusfond and BPEF III
Supplementary Investment Facility usaldusford entered into a co-operation
agreement in relation to the Offer (the "Co-operation Agreement"). Under the
terms of the Co-operation Agreement: (i) Bidco has agreed to use, and each
member of the Consortium has agreed to procure that Bidco uses, all reasonable
efforts to obtain the clearances required to satisfy certain regulatory and
antitrust clearances as soon as is reasonably practicable and in any event in
sufficient time to enable the Effective Date to occur by the Long Stop Date;
(ii) subject to the Panel's consent, the parties have agreed to implement
certain arrangements with respect to a cash award to be made to Xpediator's
Chief Financial Officer; and (iii) the parties have agreed to certain
provisions if the Offer should switch to be made by way of a Takeover Offer.
In addition, Bidco has agreed to (and each member of the Consortium has agreed
to procure that Bidco will) provide Xpediator with certain information for the
purposes of the Scheme Document and to otherwise assist with the preparation
of the Scheme Document.
The Co-operation Agreement shall terminate, amongst other things: (i) if the
parties agree in writing; (ii) upon written notice of either party where: (a)
a competing offer completes, becomes effective or is declared unconditional;
or is recommended by the board of Xpediator Directors; (b) the Scheme and/or
the Resolution(s) are not approved at the Meetings; (c) the Court refuses to
sanction the Scheme or grant the Court Order at the Court Sanction Hearing; or
(d) if the unanimous and unqualified recommendation of Xpediator Directors to
Xpediator Shareholders of the Offer is adversely modified, qualified,
withdrawn or not given, or if some other "Xpediator Board Recommendation
Change" (as defined in the agreement) occurs; (iii) upon written notice served
by Bidco to Xpediator stating that: (a) a Condition which has not been waived,
is or becomes incapable of satisfaction by the Long Stop Date; or (b) a
Condition which is incapable of waiver has become incapable of satisfaction by
the Long Stop Date; (iv) the Offer is withdrawn, terminates or lapses in
accordance with its terms; or (v) if the Effective Date has not occurred on or
before the Long Stop Date (unless otherwise agreed by Bidco and Xpediator in
writing).
Pursuant to the terms of the Co-operation Agreement, Bidco undertakes that it
will, and each member of the Consortium procures that Bidco will, deliver a
notice in writing to Xpediator on the Business Day prior to the Court Sanction
Hearing confirming either: (i) the satisfaction or waiver of all Conditions
(other than the Scheme Condition); or (ii) that it intends to invoke a
Condition (if permitted by the Panel).
Under the terms of the Co-operation Agreement, Justas Veršnickas has, in his
capacity as director and shareholder of Delamode Baltics UAB, a subsidiary of
the Company, agreed to support and facilitate the payment of a dividend (of
not more than €4.2 million) from Delamode Baltics UAB to the Company, in
order to create sufficient distributable reserves within the Company to permit
the declaration and payment of the Special Dividend. Since Justas Veršnickas
is a director and substantial shareholder (as defined by the AIM Rules) of a
subsidiary of the Company, and depending on the amount of any payment
required, the payment of any resulting dividend from Delamode Baltics UAB to
Justas Veršnickas may be deemed to be a related party transaction under the
AIM Rules. Accordingly the Directors, having consulted with Zeus Capital, the
Company's nominated adviser under the AIM Rules, consider that the terms of
this arrangement are fair and reasonable insofar as Xpediator Shareholders are
concerned.
Bid Conduct Agreement
BaltCap UAB, Cogels Investments, Justas Veršnickas and Stephen Blyth each
entered into a bid conduct agreement on 11 January 2023 (the "Bid Conduct
Agreement"), pursuant to which they have agreed certain principles in
accordance with which they intend to co-operate on evaluating and implementing
the Offer, and the basis on which they intend to hold their interests in
Holdco.
Pursuant to the terms of the Bid Conduct Agreement, the Consortium has agreed:
· to co-operate and work together in good faith in
considering the Offer;
· not to do anything which might be expected to be
prejudicial to the completion of the Offer (or reasonably be expected to have
the effect of delaying, disrupting or otherwise causing the Offer to not
complete at the earliest practicable time);
· to make all decisions with respect to the Offer
through a steering committee, comprising representatives of the Consortium;
and
· customary standstill undertakings in relation to
themselves and their concert parties.
The Bid Conduct Agreement will expire and terminate upon the earlier of: (i)
by unanimous decision of the Consortium in writing; (ii) a shareholders'
agreement being executed which has the effect of superseding the Bid Conduct
Agreement; (iii) the Offer lapsing or being withdrawn; (iv) a competitive
offer becoming effective or unconditional in all respects; (v) certain
circumstances in the event that an increased offer is to be made by the
Consortium in respect of Xpediator; and (vi) the first anniversary of the date
of the Bid Conduct Agreement.
Subscription and Rollover Agreement
On 5 April 2023, Bidco, BaltCap Private Equity Fund III usaldusfond, BPEF III
Supplementary Investment Facility usaldusfond, Cogels Investments and Nuoma IR
Kapitalas, amongst other parties, entered into a subscription and rollover
agreement (the "Subscription and Rollover Agreement").
Pursuant to the Subscription and Rollover Agreement:
· Cogels Investments provides certain undertakings in relation to the
37,260,660 Xpediator Shares it holds and the implementation of the Scheme
generally, including to vote in favour of the Resolution(s) at the General
Meeting;
· Cogels Investments and Justas Veršnickas provide certain warranties
to Baltcap Private Equity Fund III usaldusfond and BPEF III Supplementary
Investment Facility usaldusford;
· Cogels Investments will sell 960,883 Xpediator Shares to Bidco in
exchange for £ 403,570.86; and
· Cogels Investments will exchange 36,299,777 Xpediator Shares for
519,229 shares in Holdco pursuant to a roll-over mechanism.
In addition to providing for the rollover of the Xpediator Shares held by
Cogels Investments, the Subscription and Rollover Agreement also details,
amongst other things, the following equity subscriptions:
· BaltCap Private Equity Fund III usaldusfonda and BPEF III
Supplementary Investment Facility usaldusfond for in aggregate 715,674
ordinary shares in Lithuanian Newco;
· Nuoma IR Kapitalas for 120,189 ordinary shares in Lithuanian Newco;
· Lithuanian Newco for 662,914 ordinary shares in Holdco;
· Holdco for 198,444 ordinary shares in Midco 1;
· Midco 1 for 198,444 ordinary shares in Midco 2; and
· Midco 2 for 198,444 ordinary shares in Bidco.
15. Structure of the Offer and the Scheme process
It is intended that the Offer will be implemented by means of a Court-approved
scheme of arrangement between Xpediator and Scheme Shareholders under Part 26
of the Companies Act. Bidco reserves the right to elect to implement the
Offer by way of a Takeover Offer (with the consent of the Panel and, where
required by the terms of the Co-operation Agreement, the consent of the
Xpediator Directors).
The purpose of the Scheme is to provide (alongside the Subscription and
Rollover Agreement referred to above) for Bidco to become the holder of the
entire issued and to be issued ordinary share capital of Xpediator. This is
to be achieved by the transfer of the Scheme Shares to Bidco, in consideration
for which the Xpediator Shareholders will receive the cash consideration (on
the basis set out in paragraph 2 of this Announcement) and/or, if applicable,
the Loan Notes pursuant to the Loan Note Alternative (on the basis set out in
paragraph 10 of this Announcement).
The Offer will be put to those Scheme Shareholders entitled to vote at the
Court Meeting and to Xpediator Shareholders at the General Meeting. In order
to become Effective, the Scheme must be approved by a majority in number of
the Scheme Shareholders voting at the Court Meeting, either in person or by
proxy, representing at least 75 per cent. in value of the Scheme Shares voted.
In addition, the Resolution(s) must be approved by the requisite majority or
majorities of Xpediator Shareholders at the General Meeting. The General
Meeting will be held immediately after the Court Meeting.
The Xpediator Shares owned or controlled by Cogels Investments (being
37,260,660 Xpediator Shares as at the Latest Practicable Date), will not be
Scheme Shares and will not be acquired by Bidco pursuant to the Offer. Upon
the Offer becoming Effective, Cogels Investments will (i) indirectly
contribute 36,299,777 Xpediator Shares owned or controlled by it (representing
approximately 25.62 per cent. of Xpediator's issued share capital on the
Latest Practicable Date) to Bidco and (ii) sell 960,883 Xpediator Shares owned
or controlled by it (representing approximately 0.68 per cent. of Xpediator's
issued share capital on the Latest Practicable Date) to Bidco in exchange for
cash at the same price per Xpediator Share as the Cash Offer. Cogels
Investments and the Blyth Family Members will not be permitted to vote the
Xpediator Shares owned or controlled by them at the Court Meeting, but will be
permitted to vote such Xpediator Shares at the General Meeting.
Notwithstanding the fact that the Blyth Family Members will not be permitted
to vote their Xpediator Shares at the Court Meeting, each of the Blyth Family
Members have undertaken for their Xpediator Shares to be bound by the terms of
the Scheme.
The Scheme will also be subject to the Conditions and further terms set out in
Appendix 1 to this Announcement and to be set out in the Scheme Document.
Once the necessary approvals from Xpediator Shareholders have been obtained
and the other Conditions have been satisfied or (where applicable) waived, the
Scheme must be sanctioned by the Court. The Scheme will only become
Effective upon delivery of the Court Order to the Registrar of Companies for
registration.
The Offer will lapse if, amongst other things:
· the Court Meeting and the General Meeting are not
held by the 22nd day after the expected date of such Meetings as set out in
the Scheme Document (or such later date as may be agreed between Bidco and
Xpediator, with the consent of the Panel and as the Court may approve, if such
approval is required); or
· the Scheme does not become Effective by the Long
Stop Date (or such later date as may be agreed between Bidco and Xpediator,
with the consent of the Panel and as the Court may approve, if such approval
is required).
Upon the Scheme becoming Effective, it will be binding on all Xpediator
Shareholders, irrespective of whether or not they attended or voted at the
Court Meeting or the General Meeting (and if they attended and voted, whether
or not they voted in favour). The consideration payable under the Offer will
be despatched by (or on behalf of) Bidco to Scheme Shareholders no later than
14 days after the Effective Date.
Any Xpediator Shares issued before the Scheme Record Time will be subject to
the terms of the Scheme. The Resolution(s) to be proposed at the General
Meeting will, amongst other matters, provide that the Articles be amended to
incorporate provisions requiring any Xpediator Shares issued after the Scheme
Record Time (other than to Bidco and/or its nominees) to be automatically
transferred to Bidco on the same terms as the Scheme (other than terms as to
timings and formalities), in exchange for the same cash consideration
(excluding the Special Dividend) as is due under the Scheme. These provisions
of the articles of association (as amended) will avoid any person (other than
Bidco and/or its nominees) holding Xpediator Shares after the Effective Date.
The Scheme Document will include full details of the Scheme, together with
notices of the Court Meeting and the General Meeting and the expected
timetable for the implementation of the Scheme, and will specify the action to
be taken by Scheme Shareholders. The Scheme Document, together with
accompanying Forms of Proxy, are expected to be published and sent to
Xpediator Shareholders within 28 days of the date of this Announcement (unless
the Panel agrees otherwise).
Subject to, amongst other things, the satisfaction (or, where applicable,
waiver) of the Conditions, it is expected that the Scheme will become
Effective in the third quarter of 2023.
The Scheme will be subject to English law and the jurisdiction of the Court,
and to the applicable requirements of the Takeover Code, the Panel, the London
Stock Exchange (including the AIM Rules), the Financial Conduct Authority and
the Registrar of Companies.
16. Conditions to the Offer
The Offer will be subject to the Conditions, including antitrust and foreign
direct investment approvals as referred to in paragraphs 3 to 6 of the
Conditions, and the further terms, each as set out in Appendix 1 to this
Announcement and to be set out in the Scheme Document.
17. Cancellation of admission to trading on AIM and
re-registration of Xpediator
Prior to the Scheme becoming Effective, it is intended that an application
will be made to the London Stock Exchange to cancel the trading of Xpediator
Shares on AIM, with effect from shortly following the Effective Date. The
last day of dealings in, and registration of transfers of, Xpediator Shares on
AIM is expected to be the Business Day immediately prior to the Effective Date
and no transfers will be registered after 6:00 p.m. (London time) on that
date.
On the Effective Date, share certificates in respect of Xpediator Shares will
cease to be valid and entitlements to Xpediator Shares held within the CREST
system will be cancelled.
It is also proposed that, following the Effective Date and after the admission
to trading of the Xpediator Shares on AIM has been cancelled, Xpediator will
be re-registered as a private limited company under the relevant provisions of
the Companies Act.
18. Dividends
In connection with the Offer, Xpediator and Bidco have agreed that, in each
case subject to compliance with applicable laws, the Xpediator Directors
should declare, and that Xpediator should pay, the Special Dividend in
connection with the Offer, without such dividend otherwise impacting on the
consideration payable under the Offer. The Special Dividend is conditional
upon the Scheme becoming Effective (or, if the Offer is implemented by way of
a Takeover Offer, the Takeover Offer becoming or being declared unconditional
in all respects). Xpediator Shareholders on the register of members at the
Scheme Record Time (or, if the Offer is implemented by way of a Takeover
Offer, the date on which the Takeover Offer is declared unconditional in all
respects) shall be entitled to receive the Special Dividend. If the Scheme
becomes Effective (or, if the Takeover Offer becomes or is declared
unconditional), the Special Dividend will be paid not more than 14 days after
the Effective Date.
If, on or after the date of this Announcement and before the Effective Date,
any dividend, distribution and/or other return of capital is declared, made or
paid or becomes payable in respect of the Xpediator Shares (other than, or in
excess of, the Special Dividend), Bidco reserves the right to reduce the
consideration payable under the terms of the Offer for the Xpediator Shares by
an amount up to the amount of such dividend, distribution and/or return of
capital (or excess, as applicable), excluding any amount in respect of the
Excluded Shares, in which case the relevant eligible Xpediator Shareholders
will be entitled to receive and retain such dividend and/or distribution
and/or return of capital. If Bidco exercises its rights described above, any
reference in this Announcement to the consideration payable under the terms of
the Offer will be deemed to be a reference to the consideration as so reduced.
Any exercise by Bidco of its rights referred to in this paragraph shall be the
subject of an announcement and, for the avoidance of doubt, shall not be
regarded as constituting any revision or variation of the terms of the Scheme.
Under the terms of the Co-operation Agreement, Justas Veršnickas has, in his
capacity as director and shareholder of Delamode Baltics UAB, a subsidiary of
the Company, agreed to support and facilitate the payment of a dividend (of
not more than €4.2 million) from Delamode Baltics UAB to the Company, in
order to create sufficient distributable reserves within the Company to permit
the declaration and payment of the Special Dividend. Since Justas Veršnickas
is a director and substantial shareholder (as defined by the AIM Rules) of a
subsidiary of the Company, and depending on the amount of any payment
required, the payment of any resulting dividend from Delamode Baltics UAB to
Justas Veršnickas may be deemed to be a related party transaction under the
AIM Rules. Accordingly the Directors, having consulted with Zeus Capital, the
Company's nominated adviser under the AIM Rules, consider that the terms of
this arrangement are fair and reasonable insofar as Xpediator Shareholders are
concerned.
19. Disclosure of Interests in Xpediator
The Consortium made an Opening Position Disclosure, setting out the details
required to be disclosed by it under Rule 8 of the Takeover Code, on 5 January
2023.
As at the Latest Practicable Date, persons acting in concert with Bidco owned
37,812,268 Xpediator Shares (representing approximately 26.69 per cent. of
Xpediator's issued share capital on such date), as further detailed below:
Name Number of Xpediator Shares Percentage of Xpediator existing issued share capital on the Latest
Practicable Date
Cogels Investments 37,260,660 26.30
Lucia Blyth 104,077 0.07
Claudia Blyth 104,077 0.07
Olivia Blyth 104,077 0.07
Emilia Blyth 104,077 0.07
George Blyth 104,077 0.07
Frances Lee 31,223 0.02
Total 37,812,268 26.69
As at the close of business on the Latest Practicable Date, save for the (a)
irrevocable undertakings referred to in paragraph 6 of this Announcement and
(b) the interests referred to above in this paragraph 19 of this Announcement
(in relation to the Xpediator Shares held by persons acting in concert with
Bidco), neither Bidco, nor any of its directors, nor, so far as Bidco is
aware, any person acting in concert (within the meaning of the Takeover Code)
with it had:
(i) any interest in or right to subscribe for any
relevant securities of Xpediator; nor
(ii) any short positions in respect of relevant
Xpediator Shares (whether conditional or absolute and whether in the money or
otherwise), including any short position under a derivative, any agreement to
sell or any delivery obligation or right to require another person to purchase
or take delivery; nor
(iii) borrowed or lent any relevant Xpediator Shares
(including, for these purposes, any financial collateral arrangements of the
kind referred to in Note 4 on Rule 4.6 of the Takeover Code), save for any
borrowed shares which had been either on-lent or sold; nor
(iv) entered into any dealing arrangement of the kind
referred to in Note 11 on the definition of acting in concert in the Takeover
Code.
An "interest in" securities for these purposes arises, in summary, when a
person has long economic exposure, whether absolute or conditional, to changes
in the price of securities (and a person who only has a short position in
securities is not treated as interested in those securities). In particular, a
person will be treated as having an 'interest' by virtue of the ownership,
voting rights or control of securities, or by virtue of any agreement to
purchase, option in respect of, or derivative referenced to securities.
20. General
The Offer will be made subject to the Conditions and further terms set out in
Appendix 1 to this Announcement and to be set out in the Scheme Document.
The bases and sources of certain financial information contained in this
Announcement are set out in Appendix 2 to this Announcement. A summary of
the irrevocable undertakings given in relation to the Offer is contained in
Appendix 3 to this Announcement. Certain terms used in this Announcement are
defined in Appendix 4 to this Announcement.
Rothschild & Co and Zeus Capital have each given and not withdrawn their
consent to the publication of this Announcement with the inclusion herein of
the references to their names in the form and context in which they appear.
21. Documents available on website
Copies of the following documents will be made available on BaltCap's and/or
Xpediator's websites, at https://www.baltcap.com/offer-for-xpediator-plc/ and
https://www.xpediator.com/offer-for-xpediator-plc/ respectively, until the end
of the Offer Period:
· a copy of this Announcement;
· the irrevocable undertakings referred to in
paragraph 6 above and summarised in Appendix 3 to this Announcement;
· the Convertible Bond referred to in paragraph 12
above;
· the Bid Conduct Agreement referred to in paragraph
14 above;
· the Subscription and Rollover Agreement referred to
in paragraph 14 above;
· the Confidentiality Agreement referred to in
paragraph 14 above;
· the Co-operation Agreement referred to in paragraph
14 above; and
· the consent letters in respect of the consents
referred to in paragraph 20 above.
Enquiries:
Bidco
Šarūnas Alekna
Stephen
Blyth
Tel: +370 5254 6713
Rothschild & Co
(Financial adviser to Bidco)
Stuart Vincent
Harry O'Connor
Tel: +44 (0)20 7280 5000
Xpediator
Gillian Wilmot CBE, Interim Chairman
Mike Stone, Interim CEO
Richard Myson,
CFO
Tel: +44 (0)330 043 2395
Zeus Capital
(Financial adviser, Nominated Adviser and corporate broker to Xpediator)
David Foreman
Jamie Peel
James
Hornigold
Tel: +44 (0)20 3829 5000
Novella Communications
(Financial Public Relations to Xpediator)
Tim Robertson
Safia
Colebrook
Tel: +44 (0)20 3151 7008
Travers Smith LLP is providing legal advice to BaltCap and Bidco. Addleshaw
Goddard LLP is providing legal advice to Xpediator.
Important notices
Rothschild & Co, which is authorised and regulated in the United Kingdom
by the FCA, is acting as financial adviser to Bidco and for no one else in
connection with the subject matter of this Announcement and will not be
responsible to anyone other than Bidco for providing the protections afforded
to its clients or for providing advice in relation to the subject matter of
this Announcement, the contents of this Announcement or any other matters
referred to in this Announcement. Neither Rothschild & Co nor any of its
affiliates (nor their respective directors, officers, employees or agents)
owes or accepts any duty, liability or responsibility whatsoever (whether
direct or indirect, whether in contract, in tort, under statute or otherwise)
to any person who is not a client of Rothschild & Co in connection with
this Announcement, any statement contained herein, the Offer or otherwise. No
representation or warranty, express or implied, is made by Rothschild & Co
as to the contents of this Announcement.
Zeus Capital Limited, which is authorised and regulated in the United Kingdom
by the FCA, is acting as financial adviser to Xpediator and for no one else in
connection with the Offer and will not be responsible to anyone other than
Xpediator for providing the protections afforded to its clients nor for
providing advice in relation to the Offer, the contents of this Announcement
or any other matters referred to in this Announcement.
Further information
This Announcement is for information purposes only and is not intended to and
does not constitute, or form part of, an offer to sell or an invitation to
purchase any securities or a solicitation of an offer to buy, otherwise
acquire, subscribe for, sell or otherwise dispose of any securities pursuant
to the Offer or otherwise, nor shall there be any purchase, sale, issuance or
exchange of securities or such solicitation in any jurisdiction in which such
offer, solicitation, sale, issuance or exchange is unlawful. The Offer will
be made solely by means of the Scheme Document, or any document by which the
Offer is made, which document will contain the full terms and conditions of
the Offer, including details of how to vote in respect of the Scheme.
If you are in any doubt about the contents of this Announcement or the action
you should take, you are recommended to seek your own independent financial
advice immediately from your stockbroker, bank manager, solicitor, accountant
or from an independent financial adviser duly authorised under the Financial
Services and Markets Act 2000 (as amended).
Xpediator will prepare the Scheme Document to be distributed to Xpediator
Shareholders at no cost to them. Xpediator and Bidco urge Xpediator
Shareholders to read the Scheme Document when it becomes available because it
will contain important information relating to the Offer. Any vote or other
decision in respect of, or other response to, the Offer, should be made only
on the basis of information contained in the Scheme Document or any other
document by which the Offer is made.
Overseas jurisdictions
The release, publication or distribution of this Announcement in jurisdictions
other than the United Kingdom may be restricted by the laws of those
jurisdictions and therefore persons into whose possession this Announcement
comes should inform themselves about and observe such restrictions. Further
details in relation to Overseas Shareholders will be contained in the Scheme
Document. Any failure to comply with any such restrictions may constitute a
violation of the securities laws of any such jurisdiction. To the fullest
extent permitted by applicable law, the companies and persons involved in the
Offer disclaim any responsibility or liability for the violation of such
restrictions by any person.
Unless otherwise determined by Bidco or required by the Takeover Code, and
permitted by applicable law and regulation, the Offer will not be made
available, directly or indirectly, in, into or from a Restricted Jurisdiction
where to do so would violate the laws in that jurisdiction and no person may
vote in favour of the Scheme by any means from within a Restricted
Jurisdiction or any other jurisdiction if to do so would constitute a
violation of the laws of that jurisdiction. Accordingly, copies of this
Announcement and all documents relating to the Offer are not being, and must
not be, directly or indirectly, mailed or otherwise forwarded, distributed or
sent in, into or from a Restricted Jurisdiction where to do so would violate
the laws in that jurisdiction, and persons receiving this Announcement and all
documents relating to the Offer (including custodians, nominees and trustees)
must not mail or otherwise distribute or send them in, into or from such
jurisdictions where to do so would violate the laws in that jurisdiction.
The availability of the Offer to Scheme Shareholders who are not resident in
the United Kingdom may be affected by the laws of the relevant jurisdictions
in which they are resident. Persons who are not resident in the United
Kingdom should inform themselves of, and observe, any applicable requirements.
This Announcement has been prepared in connection with proposals in relation
to a scheme of arrangement pursuant to and for the purpose of complying with
English law and the Takeover Code and information disclosed may not be the
same as that which would have been disclosed if this Announcement had been
prepared in accordance with the laws of jurisdictions outside England. Nothing
in this Announcement should be relied on for any other purpose.
The Scheme will be subject to English law and the jurisdiction of the Court,
and to the applicable requirements of the Takeover Code, the Panel, the London
Stock Exchange (including the AIM Rules), the Financial Conduct Authority and
the Registrar of Companies.
Additional information for US investors
Xpediator Shareholders in the United States should note that the Offer relates
to the securities of a UK company and is proposed to be effected by means of a
scheme of arrangement under English law. This Announcement, the Scheme
Document and certain other documents relating to the Offer have been or will
be prepared in accordance with English law, the Takeover Code and UK
disclosure requirements, format and style, all of which differ from those in
the United States. A transaction effected by means of a scheme of
arrangement is not subject to the tender offer rules or the proxy solicitation
rules under the US Exchange Act. Accordingly, the Offer is subject to the
disclosure requirements of and practices applicable in the United Kingdom to
schemes of arrangement, which differ from the disclosure requirements of the
United States tender offer and proxy solicitation rules. If, in the future,
Bidco exercises the right to implement the Offer by way of a Takeover Offer
and determines to extend the offer into the United States, the Offer will be
made in compliance with applicable United States laws and regulations,
including any applicable exemptions under the US Securities Act or US Exchange
Act.
The Loan Notes have not been, and will not be, registered under the US
Securities Act or with any securities regulatory authority of any state or
other jurisdiction of the United States and may not be offered, sold,
exercised, resold, transferred or delivered, directly or indirectly, in or
into the United States except pursuant to an exemption from the registration
requirements of the US Securities Act. There will be no public offer of Loan
Notes in the United States. Accordingly, the Loan Note Alternative is not
being offered, and will not be offered, directly or indirectly in or into, or
by use of the mails 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. This includes, but is not limited to, facsimile
transmission, electronic mail, telex, telephone, the internet and other forms
of electronic communication. The Loan Note Alternative may not be applied to
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,
materials allowing for the Loan Note Alternative are not being, and must not
be, directly or indirectly mailed or otherwise published, transmitted,
distributed or forwarded (including, without limitation, by custodians,
nominees or trustees) in or into the United States or to any US persons or any
persons located or resident in the United States. Any purported applicability
of the Loan Note Alternative resulting directly or indirectly from a violation
of these restrictions will be invalid and any purported applicability of the
Loan Note Alternative made by a person located in the United States 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 person electing to receive the Loan Note Alternative will represent that
it is not a US person, it is not located in the United States and it is not
participating in the Offer from the United States or acting on a
non-discretionary basis for a principal that is not a US person, it is located
outside the United States and that it is not giving an order to participate in
the Loan Note Alternative from the United States. For the purposes of this and
the above paragraph, "United States" means 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.
Xpediator's financial statements, and all financial information that is
included in this Announcement or that may be included in the Scheme Document,
or any other documents relating to the Offer, have been or will be prepared in
accordance with International Financial Reporting Standards and may not be
comparable to financial statements of companies in the United States or other
companies whose financial statements are prepared in accordance with US
generally accepted accounting principles.
The receipt of cash pursuant to the Offer by a US holder as consideration for
the transfer of its Scheme Shares pursuant to the Scheme will likely be a
taxable transaction for United States federal income tax purposes and under
applicable United States state and local, as well as foreign and other, tax
laws. Each Xpediator Shareholder is urged to consult his independent
professional adviser immediately regarding the tax consequences of the Offer
applicable to him.
It may be difficult for US holders to enforce their rights and claims arising
out of the US federal securities laws, since Bidco and Xpediator are located
in countries other than the US, and some or all of their officers and
directors may be residents of countries other than the US. US holders may
not be able to sue a non-US company or its officers or directors in a non-US
court for violations of US securities laws. Further, it may be difficult to
compel a non-US company and its affiliates to subject themselves to a US
court's judgement.
In accordance with normal UK practice and consistent with Rule 14e-5(b) of the
US Exchange Act, Bidco, certain affiliated companies and their nominees or
brokers (acting as agents) may make certain purchases of, or arrangements to
purchase, shares in Xpediator outside of the US, other than pursuant to the
Offer, until the date on which the Scheme and/or the Takeover Offer becomes
Effective, lapses or is otherwise withdrawn. If such purchases or
arrangements to purchase were to be made they would occur either in the open
market at prevailing prices or in private transactions at negotiated prices
and comply with applicable law, including the US Exchange Act. Any
information about such purchases or arrangements to purchase will be disclosed
as required in the United Kingdom, will be reported to a Regulatory
Information Service and will be available on the London Stock Exchange website
at www.londonstockexchange.com.
Forward-looking statements
This Announcement (including information incorporated by reference in this
Announcement) and other information published by Bidco, BaltCap, any member of
the Consortium or Xpediator contain statements about Bidco, BaltCap, any
member of the Consortium and Xpediator that are or may be deemed to be forward
looking statements. All statements other than statements of historical facts
included in this Announcement may be forward looking statements. Without
limitation, any statements preceded or followed by or that include the words
"targets", "plans", "believes", "expects", "aims", "intends", "will", "may",
"anticipates", "estimates", "projects" or words or terms of similar substance
or the negative thereof, are forward looking statements. Forward looking
statements include statements relating to the following: (i) future capital
expenditures, expenses, revenues, earnings, synergies, economic performance,
indebtedness, financial condition, dividend policy, losses and future
prospects; (ii) business and management strategies and the expansion and
growth of Bidco's or Xpediator's operations and potential synergies resulting
from the Offer; and (iii) the effects of government regulation on Bidco's or
Xpediator's business.
These forward-looking statements are not guarantees of future performance.
Such forward-looking statements involve known and unknown risks and
uncertainties that could significantly affect expected results and are based
on certain key assumptions. Many factors could cause actual results to
differ materially from those projected or implied in any forward-looking
statements. These factors include, but are not limited to, the satisfaction
of the conditions to the Offer, as well as additional factors, such as changes
in political and economic conditions, changes in the level of capital
investment, retention of key employees, changes in customer habits, success of
business and operating initiatives and restructuring objectives, impact of any
acquisitions or similar transactions, changes in customers' strategies and
stability, competitive product and pricing measures, changes in the regulatory
environment, fluctuations of interest and exchange rates, and the outcome of
any litigation. Due to such uncertainties and risks, readers are cautioned
not to place undue reliance on such forward-looking statements, which speak
only as of the date of this Announcement. All subsequent forward-looking
statements attributable to Bidco, BaltCap, any member of the Consortium or
Xpediator or any of their respective members, directors, officers or employees
or any persons acting on their behalf are expressly qualified in their
entirety by the cautionary statement above. Bidco, BaltCap, any member of
the Consortium and Xpediator disclaim any obligation to update any
forward-looking or other statements contained in this Announcement, except as
required by applicable law.
No profit forecasts or estimates
Except where indicated, no statement in this Announcement is intended as a
profit forecast or estimate for any period and no statement in this
Announcement should be interpreted to mean that earnings or earnings per share
for Xpediator for the current or future financial years would necessarily
match or exceed the historical published earnings or earnings per share for
Xpediator.
Disclosure requirements of the Takeover Code
Under Rule 8.3(a) of the Takeover Code, any person who is interested in 1% or
more of any class of relevant securities of an offeree company or of any
securities exchange offeror (being any offeror other than an offeror in
respect of which it has been announced that its offer is, or is likely to be,
solely in cash) must make an Opening Position Disclosure following the
commencement of the offer period and, if later, following the announcement in
which any securities exchange offeror is first identified. An Opening Position
Disclosure must contain details of the person's interests and short positions
in, and rights to subscribe for, any relevant securities of each of (i) the
offeree company; and (ii) any securities exchange offeror(s). An Opening
Position Disclosure by a person to whom Rule 8.3(a) applies must be made by no
later than 3.30 pm (London time) on the 10th business day following the
commencement of the offer period and, if appropriate, by no later than 3.30 pm
(London time) on the 10th business day following the announcement in which any
securities exchange offeror is first identified. Relevant persons who deal in
the relevant securities of the offeree company or of a securities exchange
offeror prior to the deadline for making an Opening Position Disclosure must
instead make a Dealing Disclosure.
Under Rule 8.3(b) of the Takeover Code, any person who is, or becomes,
interested in 1% or more of any class of relevant securities of the offeree
company or of any securities exchange offeror must make a Dealing Disclosure
if the person deals in any relevant securities of the offeree company or of
any securities exchange offeror. A Dealing Disclosure must contain details of
the dealing concerned and of the person's interests and short positions in,
and rights to subscribe for, any relevant securities of each of (i) the
offeree company; and (ii) any securities exchange offeror(s), save to the
extent that these details have previously been disclosed under Rule 8. A
Dealing Disclosure by a person to whom Rule 8.3(b) applies must be made by no
later than 3.30 pm (London time) on the business day following the date of the
relevant dealing.
If two or more persons act together pursuant to an agreement or understanding,
whether formal or informal, to acquire or control an interest in relevant
securities of an offeree company or a securities exchange offeror, they will
be deemed to be a single person for the purpose of Rule 8.3.
Opening Position Disclosures must also be made by the offeree company and by
any offeror and Dealing Disclosures must also be made by the offeree company,
by any offeror and by any persons acting in concert with any of them (see
Rules 8.1, 8.2 and 8.4).
Details of the offeree and offeror companies in respect of whose relevant
securities Opening Position Disclosures and Dealing Disclosures must be made
can be found in the Disclosure Table on the Takeover Panel's website at
www.thetakeoverpanel.org.uk, including details of the number of relevant
securities in issue, when the offer period commenced and when any offeror was
first identified. You should contact the Panel's Market Surveillance Unit on
+44 (0)20 7638 0129 if you are in any doubt as to whether you are required to
make an Opening Position Disclosure or a Dealing Disclosure.
Right to switch to a Takeover Offer
Bidco reserves the right to elect, with the consent of the Panel, and subject
to the terms of the Co-operation Agreement, to implement the Offer by way of a
Takeover Offer for the entire issued and to be issued ordinary share capital
of Xpediator as an alternative to the Scheme. In such an event, the Takeover
Offer will be implemented on the same terms or, if Bidco so decides, on such
other terms being no less favourable (subject to appropriate amendments), so
far as applicable, as those which would apply to the Scheme and subject to the
amendments referred to in Appendix 1 to this Announcement.
Publication on website
A copy of this Announcement and the documents required to be published
pursuant to Rule 26.1 of the Takeover Code will be available, free of charge,
subject to certain restrictions relating to persons resident in Restricted
Jurisdictions on BaltCap's website at
https://www.baltcap.com/offer-for-xpediator-plc/ and Xpediator's website at
https://www.xpediator.com/offer-for-xpediator-plc/ by no later than 12:00 p.m.
on the Business Day following publication of this Announcement.
For the avoidance of doubt, the contents of these websites and any websites
accessible from hyperlinks on these websites are not incorporated into and do
not form part of this Announcement.
Information relating to Xpediator Shareholders
Please be aware that addresses, electronic addresses and certain information
provided by Xpediator Shareholders, persons with information rights and other
relevant persons for the receipt of communications from Xpediator may be
provided to Bidco during the Offer Period as required under Section 4 of
Appendix 4 of the Takeover Code to comply with Rule 2.11(c) of the Takeover
Code.
Right to receive documents in hard copy form
In accordance with Rule 30.3 of the Takeover Code, Xpediator Shareholders,
persons with information rights and participants in the Xpediator Share Plans
may request a hard copy of this Announcement, free of charge, by contacting
Xpediator's registrars, Share Registrars Limited, by: (i) submitting a request
in writing to Share Registrars Limited, 3 The Millennium Centre, Crosby Way,
Farnham, Surrey, GU9 7XX, United Kingdom; or (ii) calling +44 (0) 1252 821390.
Calls are charged at the standard geographical rate and will vary by provider.
Calls outside the United Kingdom will be charged at the applicable
international rate. Phone lines are open between 9:00 a.m. and 5:00 p.m.
(London time), Monday to Friday (excluding public holidays in England and
Wales). Please note that Share Registrars cannot provide any financial, legal
or tax advice and calls may be recorded and monitored for security and
training purposes.
Such persons may also request that all future documents, announcements and
information in relation to the Offer are sent to them in hard copy form. For
persons who receive a copy of this Announcement in electronic form, a hard
copy of this Announcement will not be sent unless so requested.
Rounding
Certain figures included in this Announcement have been subjected to rounding
adjustments. Accordingly, figures shown for the same category presented in
different tables may vary slightly and figures shown as totals in certain
tables may not be an arithmetic aggregation of the figures that precede them.
Appendix 1 CONDITIONS AND FURTHER TERMS OF THE OFFER
PART A: CONDITIONS TO THE SCHEME AND THE OFFER
Long Stop Date
1. The Offer will be conditional upon the Scheme
becoming unconditional and being Effective, subject to the provisions of the
Takeover Code, by no later than 11:59 p.m. on the Long Stop Date.
Scheme approval
2. The Scheme will be conditional upon:
(a)
(i) its approval by a majority in number of the
Scheme Shareholders who are present and vote (and are entitled to vote),
either in person or by proxy, at the Court Meeting (or at any adjournment of
that Meeting) and who represent at least 75 per cent. in value of the Scheme
Shares voted by those Scheme Shareholders; and
(ii) such Court Meeting being held on or before the
22nd day after the expected date of such Meeting as set out in the Scheme
Document (or such later date as may be agreed by Bidco and Xpediator, with the
consent of the Panel, and (if required) the Court may allow);
(b)
(i) the Resolution(s) being duly passed by the
requisite majority or majorities of Xpediator Shareholders at the General
Meeting (or any adjournment of that Meeting); and
(ii) such General Meeting being held on or before
the 22nd day after the expected date of such Meeting as set out in the Scheme
Document (or such later date as may be agreed by Bidco and Xpediator, with the
consent of the Panel, and (if required) the Court may allow); and
(c) the sanction of the Scheme by the
Court (with or without modification but subject to any modification being on
terms acceptable to Xpediator and Bidco) and the delivery of a copy of the
Court Order to the Registrar of Companies.
General Offer Conditions
In addition, subject as stated in Part B below and to the requirements of the
Panel, the Offer will be conditional upon the following Conditions and,
accordingly, the necessary actions to make the Scheme Effective (including
delivery of the Court Order to the Registrar of Companies) will not be taken
unless such Conditions (as amended if appropriate) have been satisfied and
continue to be satisfied or, where relevant, waived:
Antitrust and regulatory clearances
3. to the extent the Offer constitutes a
concentration requiring merger control clearance in Lithuania, the earlier of:
(a) the competition authority of Lithuania
having notified Bidco that it has decided not to initiate a Phase II
Investigation in respect of the Offer and having made a decision on the basis
of which the Offer can be implemented without any conditions or limitations,
or with conditions or limitations that are satisfactory to Bidco, acting
reasonably;
(b) having carried out a Phase II
Investigation, the competition authority of Lithuania having notified Bidco
that it has taken a decision on the basis of which the Offer can be
implemented without any conditions or limitations, or with conditions or
limitations that are satisfactory to Bidco, acting reasonably; or
(c) lapse of the applicable statutory
period upon which the permission to implement the Offer without any conditions
or limitations (or with conditions or limitations that are satisfactory to
Bidco, acting reasonably) is deemed issued;
4. to the extent the Offer constitutes a
concentration requiring merger control clearance in Latvia, the earlier of:
(a) the competition authority of Latvia
having notified Bidco that it has decided not to initiate a Phase II
Investigation in respect of the Offer and having made a decision on the basis
of which the Offer can be implemented without any conditions or limitations,
or with conditions or limitations that are satisfactory to Bidco, acting
reasonably;
(b) having carried out a Phase II
Investigation, the competition authority of Latvia having notified Bidco that
it has taken a decision on the basis of which the Offer can be implemented
without any conditions or limitations, or with conditions or limitations that
are satisfactory to Bidco, acting reasonably; or
(c) lapse of the applicable statutory
period upon which the permission to implement the Offer without any conditions
or limitations (or with conditions or limitations that are satisfactory to
Bidco, acting reasonably) is deemed issued;
5. to the extent the Offer constitutes a
concentration requiring merger control clearance in Estonia, the earlier of:
(a) the competition authority of Estonia
having notified Bidco that it has decided not to initiate a Phase II
Investigation in respect of the Offer and having made a decision on the basis
of which the Offer can be implemented without any conditions or limitations,
or with conditions or limitations that are satisfactory to Bidco, acting
reasonably;
(b) having carried out a Phase II
Investigation, the competition authority of Estonia having notified Bidco that
it has taken a decision on the basis of which the Offer can be implemented
without any conditions or limitations, or with conditions or limitations that
are satisfactory to Bidco, acting reasonably; or
(c) lapse of the applicable statutory
period upon which the permission to implement the Offer without any conditions
or limitations (or with conditions or limitations that are satisfactory to
Bidco, acting reasonably) is deemed issued;
6. to the extent the Offer requires mandatory
notification to and clearance from the FDI Authority, the FDI Authority having
notified Bidco of its determination that the Offer can be implemented without
any conditions or limitations, or with conditions or limitations that are
satisfactory to Bidco, acting reasonably;
Notifications, waiting periods and Authorisations
7. all notifications, filings or applications
which are necessary or reasonably considered appropriate by Bidco having been
made in connection with the Offer and all necessary waiting periods (including
any extensions thereof) under any applicable legislation or regulation of any
jurisdiction having expired, lapsed or been terminated (as appropriate) and
all statutory and regulatory obligations in any jurisdiction having been
complied with in each case in respect of the Offer and its implementation and
all Authorisations reasonably necessary or appropriate for or in respect of
the Offer and, except pursuant to Chapter 3 of Part 28 of the Companies Act,
the acquisition of any shares or other securities in, or control or management
of, Xpediator or any other member of the Wider Xpediator Group by any member
of the Wider Bidco Group having been obtained in terms and in a form
satisfactory to Bidco from all appropriate Third Parties or (without prejudice
to the generality of the foregoing) from any person or bodies with whom any
member of the Wider Xpediator Group has entered into contractual arrangements
and all such Authorisations necessary or reasonably considered appropriate by
Bidco to carry on the business of any member of the Wider Xpediator Group in
any jurisdiction which is material in the context of the Wider Xpediator Group
having been obtained and all such Authorisations remaining in full force and
effect at the time at which the Offer becomes otherwise unconditional and
there being no notice or intimation of an intention to revoke, suspend,
restrict, modify or not to renew such Authorisations;
General antitrust and regulatory clearances
8. other than in relation to the matters referred
to in Conditions 3 to 6 (inclusive), no antitrust regulator or Third Party
having given notice of a decision to take, institute, implement or threaten
any action, proceeding, suit, investigation, enquiry or reference (and in each
case, not having withdrawn the same), or having required any action to be
taken or otherwise having done anything, or having enacted, made or proposed
any statute, regulation, decision, order or change to published practice or
having taken any other steps (and in each case, not having withdrawn the
same) and there not continuing to be outstanding any statute, regulation,
decision or order which in each case would or might reasonably be expected to:
(a) require, prevent or delay the
divestiture or materially alter the terms envisaged for such divestiture by
any member of the Wider Bidco Group or by any member of the Wider Xpediator
Group of all or any part of their respective businesses, assets or property or
impose any limitation on the ability of all or any of them to conduct their
respective businesses (or any part thereof) or to own, control or manage any
of their respective assets or properties (or any part thereof) which, in any
such case, is material in the context of the Wider Bidder Group or the Wider
Xpediator Group each taken as a whole;
(b) except pursuant to Chapter 3 of Part
28 of the Companies Act, require any member of the Wider Bidco Group or the
Wider Xpediator Group to acquire or offer to acquire any shares, other
securities (or the equivalent) or interest in any member of the Wider
Xpediator Group (other than in the implementation of the Offer);
(c) impose any material limitation on,
or result in a material delay in, the ability of any member of the Wider Bidco
Group directly or indirectly to acquire, hold or to exercise effectively all
or any rights of ownership in respect of shares, loans or securities
convertible into shares or any or other securities in Xpediator or on the
ability of any member of the Wider Xpediator Group or any member of the Wider
Bidco Group directly or indirectly to hold or exercise effectively all or any
rights of ownership in respect of shares, loans or securities convertible into
shares or any other securities (or the equivalent) in, or to exercise voting
or management control over, any member of the Wider Xpediator Group;
(d) otherwise adversely affect any or all
of the business, assets, profits or prospects of any member of the Wider
Xpediator Group or any member of the Wider Bidco Group to an extent which is
material in the context of the Wider Bidder Group or the Wider Xpediator Group
each taken as a whole;
(e) result in any member of the Wider
Xpediator Group or any member of the Wider Bidco Group ceasing to be able to
carry on business under any name under which it presently carries on business;
(f) make the Offer, its implementation
or the acquisition of any shares or other securities in, or control or
management of, Xpediator by any member of the Wider Bidco Group void,
unenforceable and/or illegal under the laws of any relevant jurisdiction, or
otherwise, directly or indirectly prevent, prohibit, restrict, restrain, delay
or otherwise interfere with the implementation of, or impose additional
conditions or obligations with respect to, or otherwise challenge, impede,
interfere or require material amendment of the Offer or the acquisition of any
shares or other securities in, or control or management of, Xpediator by any
member of the Wider Bidco Group;
(g) require, prevent or materially delay a
divestiture by any member of the Wider Bidco Group of any shares or other
securities (or the equivalent) in any member of the Wider Xpediator Group or
any member of the Wider Bidco Group; or
(h) impose any limitation on the ability
of any member of the Wider Bidco Group or any member of the Wider Xpediator
Group to conduct, integrate or co-ordinate all or any part of its business
with all or any part of the business of any other member of the Wider Bidco
Group and/or the Wider Xpediator Group to an extent which is material in the
context of the Wider Bidder Group or the Wider Xpediator Group each taken as a
whole or in the context of the Offer,
and all applicable waiting and other time periods (including any extensions
thereof) during which any such antitrust regulator or Third Party could decide
to take, institute, implement or threaten any such action, proceeding, suit,
investigation, enquiry or reference or take any other step under the laws of
any jurisdiction in respect of the Offer or the acquisition of any Xpediator
Shares having expired, lapsed or been terminated;
Certain matters arising as a result of any arrangement, agreement, etc.
9. except as Disclosed, there being no provision
of any arrangement, agreement, lease, licence, franchise, permit or other
instrument to which any member of the Wider Xpediator Group is a party or by
or to which any such member or any of its assets is or may be bound, entitled
or subject to or any event or circumstance which, as a consequence of the
Offer or the proposed acquisition or the acquisition by any member of the
Wider Bidco Group of any shares or other securities (or the equivalent) in
Xpediator or because of a change in the control or management of any member of
the Wider Xpediator Group or otherwise, would or might reasonably be expected
to result in any of the following to an extent which is material in the
context of the Wider Xpediator Group, or the Wider Bidder Group, in either
case taken as a whole, or in the context of the Offer:
(a) any monies borrowed by, or any other
indebtedness or liabilities, actual or contingent, of, or any grant available
to, any member of the Wider Xpediator Group being or becoming repayable, or
capable of being declared repayable, immediately or before its or their stated
maturity date or repayment date, or the ability of any such member to borrow
monies or incur any indebtedness being withdrawn or inhibited or being capable
of becoming or being withdrawn or inhibited;
(b) save in the ordinary course of
business, the creation or enforcement of any mortgage, charge or other
security interest over the whole or any part of the business, property or
assets of any member of the Wider Xpediator Group or any such mortgage, charge
or other security interest (whenever created, arising or having arisen)
becoming enforceable;
(c) any such arrangement, agreement,
lease, licence, franchise, permit or other instrument being or becoming
capable of being terminated or adversely modified or the rights, liabilities,
obligations or interests of any member of the Wider Xpediator Group being
terminated or adversely modified or adversely affected or any obligation or
liability arising or any adverse action being taken or arising thereunder;
(d) any member of the Wider Xpediator
Group ceasing to be able to carry on business under any name under which it
presently carries on business;
(e) the value of, or the financial or
trading position or prospects of, any member of the Wider Xpediator Group
being prejudiced or adversely affected; or
(f) the creation or acceleration of any
liability (actual or contingent) by any member of the Wider Xpediator Group,
other than trade creditors or other liabilities incurred in the ordinary
course of business or in connection with the Offer,
and, save as Disclosed, no event having occurred which, under any provision of
any arrangement, agreement, licence, permit, franchise, lease or other
instrument to which any member of the Wider Xpediator Group is a party or by
or to which any such member or any of its assets are bound, entitled or
subject, would or might reasonably be expected to result in any of the events
or circumstances as are referred to in Conditions 9(a) to (f), which in each
case is material in the context of the Wider Xpediator Group, or the Wider
Bidder Group, in either case taken as a whole, or in the context of the Offer;
Certain events occurring since 31 December 2021
10. except as Disclosed, no member of the Wider
Xpediator Group having since 31 December 2021:
(a) issued or agreed to issue or
authorised or proposed the issue, of additional shares of any class, or
securities or securities convertible into, or exchangeable for, or rights,
warrants or options to subscribe for or acquire, any such shares, securities
or convertible securities or transferred or sold or agreed to transfer or sell
or authorised or proposed the transfer or sale of Xpediator Shares out of
treasury (except, where relevant, as between Xpediator and wholly-owned
subsidiaries of Xpediator or between the wholly-owned subsidiaries of
Xpediator and except for the issue or transfer out of treasury of Xpediator
Shares on the exercise of employee share options or vesting of employee share
awards under the Xpediator Share Plans);
(b) except for the Special Dividend,
recommended, declared, paid or made any bonus issue, dividend or other
distribution (whether payable in cash or otherwise) other than dividends (or
other distributions whether payable in cash or otherwise) lawfully paid or
made by any wholly-owned subsidiary of Xpediator to Xpediator or any of its
wholly-owned subsidiaries;
(c) other than pursuant to the Offer
(and except for transactions between the Wider Xpediator Group and its
wholly-owned subsidiaries and transactions in the ordinary course of business)
implemented, effected, authorised or proposed or announced its intention to
implement, effect, authorise or propose any merger, demerger, reconstruction,
amalgamation, scheme, commitment or offer or disposal of assets or shares or
loan capital (or the equivalent thereof) in each case, to the extent which is
material in the context of the Wider Xpediator Group taken as a whole;
(d) except for transactions between the
Wider Xpediator Group and its wholly-owned subsidiaries and except for
transactions in the ordinary course of business, disposed of, or transferred,
mortgaged or created any security interest over any material asset or any
right, title or interest in any asset or authorised, proposed or announced any
intention to do so, in each case, to the extent which is material in the
context of the Wider Xpediator Group taken as a whole;
(e) (except for transactions between the
Wider Xpediator Group and its wholly-owned subsidiaries) issued, authorised or
proposed or announced an intention to authorise or propose, the issue of or
made any change in or to the terms of any debentures or, save in the ordinary
course of business, become subject to any contingent liability or incurred or
increased any indebtedness;
(f) other than in the ordinary course of
business, entered into or varied or authorised, proposed or announced its
intention, to enter into or vary any contract, arrangement, agreement,
transaction or commitment (whether in respect of capital expenditure or
otherwise) which is of a long term, unusual or onerous nature or magnitude or
which is or which involves or could involve an obligation of a nature or
magnitude which is material in the context of the Wider Xpediator Group taken
as a whole;
(g) entered into or varied the terms of,
or made any offer (which remains open for acceptance) to enter into or vary
the terms of any contract, service agreement, commitment or arrangement or,
except for salary increases, bonuses or variations of terms in the ordinary
course, senior executive of any member of the Wider Xpediator Group;
(h) proposed, agreed to provide or
modified the terms of any share option scheme, incentive scheme or other
benefit relating to the employment or termination of employment of any
employee of the Wider Xpediator Group in each case, to the extent which is
material in the context of the Wider Xpediator Group taken as a whole;
(i) purchased, redeemed or repaid or
announced any proposal to purchase, redeem or repay any of its own shares or
other securities or reduced or, except in respect of the matters mentioned in
sub-paragraph (a) above, made any other change to any part of its share
capital, in each case, to the extent which is material in the context of the
Wider Xpediator Group taken as a whole;
(j) except in the ordinary course of
business, waived, compromised or settled any claim, which is material in the
context of the Wider Xpediator Group taken as a whole;
(k) terminated or varied the terms of any
agreement or arrangement between any member of the Wider Xpediator Group and
any other person in a manner which would or might reasonably be expected to
have a material adverse effect on the financial position of the Wider
Xpediator Group taken as a whole;
(l) save as envisaged in accordance
with the terms of the Scheme or otherwise in connection with the Offer, made
any alteration to its memorandum or articles of association or other
incorporation documents;
(m) except in relation to changes made or
agreed as a result of, or arising from, changes to legislation, made or agreed
or consented to any change to:
(i) the terms of the trust deeds and rules
constituting the pension scheme(s) established by any member of the Wider
Xpediator Group for its directors, employees or their dependants;
(ii) the contributions payable to any such scheme(s)
or to the benefits which accrue, or to the pensions which are payable,
thereunder;
(iii) the basis on which qualification for, or accrual
or entitlement to, such benefits or pensions are calculated or determined; or
(iv) the basis upon which the liabilities (including
pensions) of such pension schemes are funded, valued, made, agreed or
consented to,
in each case, to the extent which is material in the context of the Wider
Xpediator Group taken as a whole;
(n) been unable, or admitted in writing
that it is unable, to pay its debts or commenced negotiations with one or more
of its creditors with a view to rescheduling or restructuring any of its
indebtedness, or having stopped or suspended (or threatened to stop or
suspend) payment of its debts generally or ceased or threatened to cease
carrying on all or a substantial part of its business;
(o) (other than in respect of a member
which is dormant and was solvent at the relevant time) taken or proposed any
steps, corporate action or had any legal proceedings instituted or threatened
against it in relation to the suspension of payments, a moratorium of any
indebtedness, its winding-up (voluntary or otherwise), dissolution,
reorganisation or for the appointment of a receiver, administrator, manager,
administrative receiver, trustee or similar officer of all or any of its
assets or revenues or any analogous or equivalent steps or proceedings in any
jurisdiction or appointed any analogous person in any jurisdiction or had any
such person appointed, in each case, to the extent which is material in the
context of the Wider Xpediator Group taken as a whole;
(p) (except for transactions between the
Wider Xpediator Group and its wholly-owned subsidiaries), made, authorised,
proposed or announced an intention to propose any change in its loan capital,
in each case, to the extent which is material in the context of the Wider
Xpediator Group taken as a whole;
(q) taken (or agreed or proposed to take)
any action which requires or would require, the consent of the Panel or the
approval of Xpediator Shareholders in general meeting in accordance with, or
as contemplated by, Rule 21.1 of the Takeover Code; or
(r) entered into any agreement,
arrangement, commitment or contract or passed any resolution or made any offer
(which remains open for acceptance) with respect to or announced an intention
to, or to propose to, effect any of the transactions, matters or events
referred to in this Condition 10;
No adverse change, litigation, regulatory enquiry or similar
11. except as Disclosed, since 31 December 2021 there
having been:
(a) no adverse change and no circumstance
having arisen which would or might reasonably be expected to result in any
adverse change in, the business, assets, financial or trading position or
profits or prospects or operational performance of any member of the Wider
Xpediator Group which, in any such case, is material in the context of the
Wider Xpediator Group taken as a whole or is material in the context of the
Offer;
(b) no litigation, arbitration
proceedings, prosecution or other legal proceedings having been threatened,
announced or instituted by or against or remaining outstanding against or in
respect of, any member of the Wider Xpediator Group or to which any member of
the Wider Xpediator Group is or may become a party (whether as claimant,
defendant or otherwise), in each case which is or might reasonably be expected
to be material in the context of the Wider Xpediator Group taken as a whole or
is material in the context of the Offer;
(c) no enquiry, review or investigation
by, or complaint or reference to, any Third Party against or in respect of any
member of the Wider Xpediator Group having been threatened, announced or
instituted or remaining outstanding by, against or in respect of any member of
the Wider Xpediator Group, in each case which is or might reasonably be
expected to be material in the context of the Wider Xpediator Group taken as a
whole or is material in the context of the Offer;
(d) no contingent or other liability
having arisen or become apparent to Bidco or increased which has had or might
reasonably be expected to affect adversely the business, assets, financial or
trading position or profits or prospects of any member of the Wider Xpediator
Group to an extent which is material in the context of the Wider Xpediator
Group taken as a whole or is material in the context of the Offer;
(e) no steps having been taken and no
omissions having been made which are reasonably likely to result in the
withdrawal, cancellation, termination or modification of any licence held by
any member of the Wider Xpediator Group which is necessary for the proper
carrying on of its business and the withdrawal, cancellation, termination or
modification of which might reasonably be expected to have a material adverse
effect on the Wider Xpediator Group taken as a whole or is material in the
context of the Offer; and
(f) no member of the Wider Xpediator
Group having conducted its business in breach of any applicable laws and
regulations, and which is material in the context of the Wider Xpediator Group
as a whole or material in the context of the Offer;
No discovery of certain matters regarding information, liabilities and
environmental issues
12. except as Disclosed, Bidco not having discovered
that:
(a) any financial, business or other
information concerning the Wider Xpediator Group publicly announced or
disclosed before the date of the Announcement by or on behalf of any member of
the Wider Xpediator Group is materially misleading, contains a material
misrepresentation of any fact, or omits to state a fact necessary to make that
information not misleading and which was not subsequently corrected before the
date of this Announcement by disclosure publicly, in each case, to the extent
which is material in the context of the Wider Xpediator Group taken as a
whole;
(b) any member of the Wider Xpediator
Group or any partnership, company or other entity in which any member of the
Wider Xpediator Group has a significant economic interest and which is not a
subsidiary undertaking of Xpediator is subject to any liability, contingent or
otherwise which is material in the context of the Wider Xpediator Group taken
as a whole or material in the context of the Offer;
(c) any past or present member of the
Wider Xpediator Group has not complied with all applicable legislation,
regulations or other requirements of any jurisdiction or any Authorisations
relating to the use, treatment, storage, carriage, disposal, discharge,
spillage, release, leak or emission of any waste or hazardous substance or any
substance likely to impair the environment (including property) or harm human
or animal health or otherwise relating to environmental matters or the health
and safety of humans, which non-compliance would be likely to give rise to any
material liability including any penalty for non-compliance (whether actual or
contingent) on the part of any member of the Wider Xpediator Group, in each
case to an extent which is material in the context of the Wider Xpediator
Group taken as a whole or material in the context of the Offer;
(d) there has been a disposal, discharge,
spillage, accumulation, release, leak, emission or the migration, production,
supply, treatment, storage, transport or use of any waste or hazardous
substance or any substance likely to impair the environment (including any
property) or harm human or animal health which (whether or not giving rise to
non-compliance with any law or regulation), would be likely to give rise to
any material liability (whether actual or contingent) on the part of any
member of the Wider Xpediator Group, in each case to an extent which is
material in the context of the Wider Xpediator Group taken as a whole or
material in the context of the Offer;
(e) there is or is reasonably likely to be
any obligation or liability (whether actual or contingent) or requirement to
make good, remediate, repair, reinstate or clean up any property, asset or any
controlled waters currently or previously owned, occupied, operated or made
use of or controlled by any past or present member of the Wider Xpediator
Group (or on its behalf), or in which any such member may have or previously
have had or be deemed to have had an interest, under any environmental
legislation, common law, regulation, notice, circular, Authorisation or order
of any Third Party in any jurisdiction or to contribute to the cost thereof or
associated therewith or indemnify any person in relation thereto and which is
material in the context of the Wider Xpediator Group taken as a whole or
material in the context of the Acquisition; or
(f) circumstances exist (whether as a
result of making the Offer or otherwise) which would be reasonably likely to
lead to any Third Party instituting (or whereby any member of the Wider
Xpediator Group would be likely to be required to institute), an environmental
audit or take any steps which would in any such case be reasonably likely to
result in any actual or contingent liability to improve or install new plant
or equipment or to make good, repair, reinstate or clean up any property of
any description or any asset now or previously owned, occupied or made use of
by any past or present member of the Wider Xpediator Group (or on its behalf)
or by any person for which a member of the Wider Xpediator Group is or has
been responsible, or in which any such member may have or previously have had
or be deemed to have had an interest, which is material in the context of the
Wider Xpediator Group taken as a whole or material in the context of the
Offer;
Anti-corruption, sanctions and criminal property
13. except as Disclosed, Bidco not having discovered:
(a) (i) any past or present member,
director, officer or employee of the Wider Xpediator Group is or has at any
time engaged in any activity, practice or conduct would constitute an offence
under the Bribery Act 2010, the US Foreign Corrupt Practices Act of 1977 or
any other anti-corruption legislation applicable to the Wider Xpediator Group;
or (ii) any person that performs or has performed services for or on behalf of
the Wider Xpediator Group is or has at any time engaged in any activity,
practice or conduct in connection with the performance of such services which
would constitute an offence under the Bribery Act 2010, the US Foreign Corrupt
Practices Act of 1977 or any other applicable anti-corruption legislation;
(b) any asset of any member of the Wider
Xpediator Group constitutes criminal property as defined by section 340(3) of
the Proceeds of Crime Act 2002 (but disregarding paragraph (b) of that
definition);
(c) any past or present member,
director, officer or employee of the Wider Xpediator Group, or any other
person for whom any such person may be liable or responsible, has engaged in
any business with, made any investments in, made any funds or assets available
to or received any funds or assets from: (i) any government, entity or
individual in respect of which US or European Union persons, or persons
operating in those territories, are prohibited from engaging in activities or
doing business, or from receiving or making available funds or economic
resources, by applicable US or European Union laws or regulations, including
the economic sanctions administered by the United States Office of Foreign
Assets Control or HM Treasury & Customs; or (ii) any government, entity or
individual targeted by any of the economic sanctions of the United Nations,
the United States, the European Union or any of its member states; or
(d) a member of the Wider Xpediator Group
has engaged in any transaction or conduct which would cause any member of the
Wider Bidco Group to be in breach of any applicable law or regulation upon its
Offer of Xpediator, including the economic sanctions of the United States
Office of Foreign Assets Control or HM Treasury & Customs, or any
government, entity or individual targeted by any of the economic sanctions of
the United Nations, the United States, the United Kingdom or the European
Union or any of its member states.
PART B: CERTAIN FURTHER TERMS OF THE OFFER
1. Conditions 2(a), 2(b) and 3 to 13 (inclusive)
of Part A above must each be fulfilled, determined by Bidco to be or to remain
satisfied or (if capable of waiver) be waived by Bidco prior to the
commencement of the Court Sanction Hearing, failing which the Scheme will
lapse.
2. Notwithstanding the paragraph above, subject to
the requirements of the Panel and the Takeover Code, Bidco reserves the right
in its sole discretion to waive:
(a) the deadline set out in Condition 1 of
Part A above, and any deadlines set out in Condition 2 of Part A of this
Appendix 1 for the timing of the Court Meeting, the General Meeting and the
Court hearing to sanction the Scheme. If any such deadline is not met, Bidco
will make an announcement by 8.00 a.m. on the Business Day following such
deadline confirming whether it has invoked or waived the relevant Condition or
agreed with Xpediator to extend the deadline in relation to the relevant
Condition. In all other respects, Conditions 1 and 2 cannot be waived; and
(b) in whole or in part, all or any of the
above Conditions 3 to 13 (inclusive) of Part A of this Appendix.
3. If Bidco is required by the Panel to make an
offer for Xpediator Shares under the provisions of Rule 9 of the Takeover
Code, Bidco may make such alterations to any of the above Conditions and terms
of the Offer as are necessary to comply with the provisions of that Rule.
4. Under Rule 13.5(a) of the Takeover Code, Bidco
may only invoke a Condition that is subject to Rule 13.5(a) of the Takeover
Code so as to cause the Offer not to proceed, to lapse or to be withdrawn with
the consent of the Panel. The Panel will normally only give its consent if the
circumstances which give rise to the right to invoke the Condition are of
material significance to Bidco in the context of the Offer. This will be
judged by reference to the facts of each case at the time that the relevant
circumstances arise.
5. Any condition that is subject to Rule 13.5(a)
of the Takeover Code may be waived by Bidco.
6. Conditions 2(a)(i), 2(b)(i) and 2(c) are not
subject to Rule 13.5(a) of the Takeover Code.
7. Subject to paragraph 3(g) of Appendix 7 to the
Takeover Code, Bidco will be under no obligation to waive (if capable of
waiver) or to treat as fulfilled any of the Conditions by a date earlier than
the latest date specified above for the fulfilment or waiver of that Condition
notwithstanding that the other Conditions of the Offer may at such earlier
date have been waived or fulfilled and that there are at such earlier date no
circumstances indicating that any of such Conditions may not be capable of
fulfilment.
8. Each of the Conditions will be regarded as a
separate Condition and will not be limited by reference to any other
Condition.
9. The Xpediator Shares to be acquired under the
Offer will be acquired with full title guarantee, fully paid and free from all
liens, equities, charges, encumbrances, options, rights of pre-emption and any
other third party rights and interests of any nature and together with all
rights now or hereafter attaching or accruing to them, including, without
limitation, voting rights and the right to receive and retain in full all
dividends and other distributions (if any) declared, made or paid, or any
other return of capital (whether by reduction of share capital or share
premium account or otherwise) made, on or after the Effective Date, (other
than the Special Dividend or any dividend in respect of which a corresponding
reduction in the consideration payable in respect of each Xpediator Share has
been made as described in paragraph 10 below).
10. Subject to the terms of the Scheme, if, on or
after the date of this Announcement and before the Effective Date, any
dividend, distribution and/or other return of capital is declared, made or
paid or becomes payable in respect of the Xpediator Shares (other than, or in
excess of, the Special Dividend), Bidco reserves the right to reduce the
consideration payable under the terms of the Offer by an amount up to the
amount of any such dividend, distribution and/or return of capital (or, if
applicable, excess), excluding any amount in respect of the Excluded Shares,
in which case: (a) any reference in this Announcement or in the Scheme
Document to the consideration payable under the terms of the Offer will be
deemed to be a reference to the consideration as so reduced; and (b) the
relevant eligible Xpediator Shareholders will be entitled to receive and
retain such dividend or distribution or return of capital.
To the extent that any such dividend or distribution announced, declared, made
or paid by Xpediator is: (i) transferred pursuant to the Offer on a basis
which entitles Bidco to receive the dividend or distribution and to retain it;
or (ii) cancelled, the consideration payable under the terms of the Offer will
not be subject to change in accordance with this paragraph. Any exercise by
Bidco of its rights referred to in this paragraph 10 shall be the subject of
an announcement and the consent of the Panel and, for the avoidance of doubt,
shall not be regarded as constituting any revision or variation of the Offer.
11. Bidco reserves the right to elect (with the
consent of the Panel and subject to the terms of the Co-operation Agreement)
to implement the Offer by way of a Takeover Offer as an alternative to the
Scheme. In such event, the Takeover Offer will be implemented on
substantially the same terms subject to appropriate amendments, including
(without limitation) an acceptance condition set at 90 per cent. (or such
lesser percentage, being more than 50 per cent., as Bidco may, subject to the
terms of the Co-operation Agreement, decide) of the shares to which such offer
relates, so far as applicable, as those which would apply to the Scheme.
12. The availability of the Offer to persons not
resident in the United Kingdom may be affected by the laws of the relevant
jurisdictions. Persons who are not resident in the United Kingdom should
inform themselves about and observe any applicable requirements.
13. The Offer is not being made, directly or
indirectly, in, into or from, or by use of the mails of, or by any means of
instrumentality (including, but not limited to, facsimile, e-mail or other
electronic transmission, telex or telephone) of interstate or foreign commerce
of, or of any facility of a national, state or other securities exchange of,
any Restricted Jurisdiction where to do so would violate the laws of that
jurisdiction.
14. The Scheme will be governed by English law and is
subject to the jurisdiction of the English courts and to the Conditions and
further terms set out in this Appendix 1 and to the full terms and Conditions
to be set out in the Scheme Document in due course. The Offer will be
subject to the applicable requirements of the Takeover Code, the Panel, the
London Stock Exchange (including the AIM Rules), the FCA and the Registrar of
Companies.
Appendix 2
SOURCES OF INFORMATION AND BASES OF CALCULATION
1. The "Latest Practicable Date" for the purposes
of this Announcement means 5 April 2023.
2. The value placed by the Offer on the existing
issued and to be issued share capital of Xpediator is based upon 141,688,425
Xpediator Shares in issue as at the Latest Practicable Date.
3. The Closing Price on any particular trading day
is taken from the Daily AIM List.
4. Volume-weighted average prices have been
derived from S&P Capital IQ and have been rounded to the nearest single
decimal place.
5. Unless otherwise stated, the financial
information of Xpediator is extracted (without material adjustment) from (a)
the annual report and audited accounts of the Xpediator Group for the 12
months ended 31 December 2021, (b) Xpediator's announcement dated 26 September
2022 of the Xpediator Group's interim condensed consolidated interim results
for the six months ended 30 June 2022 (which are unaudited) and (c)
Xpediator's trading update, announced on 2 February 2023, of its unaudited
selected financial results for the 12 months ended 31 December 2022.
6. Certain figures included in this Announcement
have been subject to rounding adjustments.
Appendix 3
IRREVOCABLE UNDERTAKINGS
1. Xpediator Directors
The following Xpediator Directors have given to Bidco irrevocable
undertakings, to vote in favour of the Scheme at the Court Meeting and in
favour of the Resolution(s) at the General Meeting, in respect of their own
beneficial holdings (or those Xpediator Shares over which they have control)
of Xpediator Shares:
Name Number of Xpediator Shares Percentage of Xpediator existing issued share capital Percentage of Scheme Shares entitled to vote at the Court Meeting
Charles McGurin 65,321 0.05 0.06
Richard Myson 1,941,272 1.37 1.87
Robert Riddleston 2,084 0.001 0.002
Total 2,008,677 1.42 1.93
These irrevocable undertakings remain binding in the event a higher competing
offer is made for Xpediator and will only cease to be binding if:
· if the Scheme Document is not sent to Xpediator Shareholders
within 28 days (or such longer period as Xpediator and Bidco agrees, and the
Panel consents);
· if, where Bidco has elected (in accordance with and subject to
the terms of the Co-operation Agreement and the Takeover Code) to proceed with
the implementation of the Offer by way of a Takeover Offer, the offer document
in respect of such Takeover Offer is not sent to Xpediator Shareholders within
28 days (or such other date as the Panel may require) after the date of the
publication of the announcement (made in accordance with the requirements of
Paragraph 8 of Appendix 7 to the Takeover Code) announcing the switch to a
Takeover Offer;
· if Bidco announces, with the consent of the Panel, that it does
not intend to make or proceed with the Offer and no new, revised or
replacement Scheme or Takeover Offer is announced by Bidco in accordance with
Rule 2.7 of the Takeover Code at the same time;
· if the Scheme (or Takeover Offer, as applicable) lapses or is
withdrawn in accordance with its terms and no new, revised or replacement
Scheme or Takeover Offer is announced by Bidco by such time;
· if the Scheme has not become Effective by the Long Stop Date
(other than in circumstances where Bidco has, prior to such date, elected to
exercise its right to proceed by way of a Takeover Offer and announced the
same in accordance with the requirements of Paragraph 8 of Appendix 7 to the
Takeover Code, and such Takeover Offer has not lapsed or been withdrawn); or
· on the date on which any competing offer for the entire issued
and to be issued share capital of Xpediator is declared unconditional (if
implemented by way of a takeover offer) or, if proceeding by way of a scheme
of arrangement, becomes effective.
2. Other Xpediator Shareholders
Irrevocable undertakings
At both the Court Meeting and the General Meeting
The following Xpediator Shareholders have given to Bidco irrevocable
undertakings, to vote in favour of the Scheme at the Court Meeting and in
favour of the Resolution(s) at the General Meeting, in respect of their own
beneficial holdings of Xpediator Shares (or those Xpediator Shares over which
they have control):
Name Number of Xpediator Shares Percentage of Xpediator existing issued share capital Percentage of Scheme Shares entitled to vote at the Court Meeting
Shaun Godfrey 22,683,761 16.01 21.83
Sandu Grigore 15,786,500 11.14 15.19
Frances Lee 31,223 0.02 0.03
Total 38,501,484 27.17 37.05
In addition, the irrevocable undertakings given by the following Xpediator
Shares include an irrevocable undertaking to accept the Loan Note Alternative
in respect of certain of their own beneficial holdings of Xpediator Shares (or
those Xpediator Shares over which they have control):
Name Number of Xpediator Shares for which consideration is received in cash Percentage of Xpediator existing issued share capital for which consideration Number of Xpediator Shares for which consideration is received in Loan Notes Percentage of Xpediator existing issued share capital for which consideration
is received in cash is received in Loan Notes
Shaun Godfrey 4,536,752 3.20 18,147,009 12.81
Sandu Grigore 3,157,300 2.23 12,629,200 8.91
Total 7,694,052 5.43 30,776,209 21.72
These irrevocable undertakings remain binding in the event a higher competing
offer is made for Xpediator and will only cease to be binding if:
· if Bidco announces, with the consent of the Panel, that it does
not intend to make or proceed with the Offer and no new, revised or
replacement Scheme or Takeover Offer is announced by Bidco in accordance with
Rule 2.7 of the Takeover Code at the same time; or
· if the Scheme (or Takeover Offer, as applicable) lapses or is
withdrawn in accordance with its terms and no new, revised or replacement
Scheme or Takeover Offer is announced by Bidco by such time.
At only the General Meeting
The following Xpediator Shareholders have given to Bidco irrevocable
undertakings to vote in favour of the Resolution(s) at the General Meeting, in
respect of their own beneficial holdings of Xpediator Shares (or those
Xpediator Shares over which they have control):
Name Number of Xpediator Shares Percentage of Xpediator existing issued share capital
Lucia Blyth 104,077 0.07
Claudia Blyth 104,077 0.07
Emilia Blyth 104,077 0.07
Olivia Blyth 104,077 0.07
George Blyth 104,077 0.07
Total 520,385 0.37
1.
Appendix 4
DEFINITIONS
The following definitions apply throughout this Announcement unless the
context requires otherwise:
"Affinity"
Affinity Balkans DOO, Affinity Leasing IFN and Affinity Transport Solutions
Srl;
"AIM" or "AIM
Market"
the AIM Market of the London Stock Exchange;
"AIM
Rules"
the AIM Rules for Companies published by the London Stock Exchange, as amended
from time to time;
"Announcement"
this announcement;
"Articles"
the articles of association of Xpediator from time to time;
"Authorisations"
regulatory authorisations, orders, determinations, recognitions, grants,
consents, clearances, confirmations, certificates, licences, permissions,
exemptions or approvals;
"BaltCap"
BaltCap AS;
"Bidco"
DLM Bidco Limited;
"Bidder
Group"
Holdco and its subsidiary undertakings (including, following the Effective
Date, the Xpediator Group);
"Blyth Family
Members"
Lucia Blyth, Claudia Blyth, Olivia Blyth, Emilia Blyth and George Blyth;
"Business
Day"
a day (other than Saturdays, Sundays and public holidays in the UK) on which
banks are open for business in the City of London;
"Cash
Offer"
42 pence in cash per Scheme Share;
"Cash
Value"
44 pence in cash per Scheme Share;
"CEE"
Central and Eastern Europe;
"Closing
Price"
the closing middle market price of an Xpediator Share on a particular trading
day as derived from the Daily AIM List;
"Cogels
Investments"
Cogels Investments Ltd;
"Companies
Act"
the Companies Act 2006, as amended;
"Conditions"
the conditions to the implementation of the Offer, as set out in Part A of
Appendix 1 to this Announcement and to be set out in the Scheme Document;
"Confidentiality
Agreement"
the confidentiality agreement dated 24 June 2022 between BaltCap UAB, Cogels
Investments and Xpediator, a summary of which is set out in paragraph 14 of
this Announcement;
"Consortium"
together, funds advised by BaltCap, Cogels Investments and Nuoma IR Kapitalas;
"Co-operation
Agreement"
the agreement dated 5 April 2023 between Xpediator, Bidco, Cogels Investments,
Nuoma IR Kapitalas UAB, Justas Veršnickas, Baltcap Private Equity Fund III
usaldusfond and BPEF III Supplementary Investment Facility usaldusford
relating to, among other things, the implementation of the Offer, a summary of
which is set out in paragraph 14 of this Announcement;
"Court"
the High Court of Justice in England and Wales;
"Court
Meeting"
the meeting of Scheme Shareholders to be convened pursuant to an order of the
Court under the Companies Act for the purpose of considering and, if thought
fit, approving the Scheme, including any adjournment thereof;
"Court
Order"
the order of the Court sanctioning the Scheme;
"Court Sanction
Hearing"
the hearing of the Court to sanction the Scheme under section 899 of the
Companies Act;
"CREST"
the system for the paperless settlement of trades in securities and the
holding of uncertificated securities operated by Euroclear;
"Daily AIM
List"
the AIM Appendix to the Daily Official List;
"Daily Official
List"
the Daily Official List published by the London Stock Exchange;
"Deferred
Shares"
the deferred shares of £1.00 each in the capital of Xpediator;
"Disclosed"
the information fairly disclosed by, or on behalf of Xpediator: (i) in the
annual report and audited accounts of Xpediator Group for the financial year
ended 31 December 2021; (ii) in this Announcement; (iii) in any other
announcement to a Regulatory Information Service by, or on behalf of Xpediator
before the publication of this Announcement; or (iv) as otherwise fairly
disclosed to BaltCap, Bidco (or its respective officers, employees, agents or
advisers in each case in their capacity as such) before the date of this
Announcement, including (without limitation) via the virtual data room
operated on behalf of Xpediator in respect of the Offer or via email;
"Effective"
the Scheme becoming effective in accordance with its terms;
"Effective
Date"
the date on which either: (i) the Scheme becomes effective; or (ii) (if Bidco
elects to implement the Offer by way of a Takeover Offer), the date on which
such Takeover Offer becomes or is declared unconditional in accordance with
the requirements of the Takeover Code, and "Effective" shall be construed
accordingly;
"Euroclear"
Euroclear UK & International Limited;
"Excluded
Shares"
(i) any Xpediator Shares of which Bidco is the holder or in which Bidco is
beneficially interested; or (ii) any Xpediator Shares which are, at the Scheme
Record Time, held by Xpediator as treasury shares (within the meaning of the
Companies Act); or (iii) any Xpediator Shares of which Cogels Investments is
the holder;
"FCA" or "Financial Conduct Authority" the
Financial Conduct Authority;
"FDI Authority"
the Commission for the Examination of Foreign Direct Investments of Romania
(Comisia pentru examinarea investiţiilor străine directe) that has the
authority to issue an approval to complete the Offer according to the
applicable law, or, in cases provided in the applicable law, the Romanian
Competition Council (Consiliul Concurenței) that carries out the functions of
the secretariat of the Commission for the Examination of Foreign Direct
Investments of Romania;
"Forms of
Proxy"
the forms of proxy for use in connection with each of the Court Meeting and
General Meeting, which will accompany the Scheme Document;
"General
Meeting"
the general meeting of Xpediator Shareholders (including any adjournment
thereof) to be convened in connection with the Scheme;
"Holdco"
DLM Holdings, UAB, a private limited company incorporated in the Republic of
Lithuania, being the ultimate holding company of Bidco;
"IFRS"
International Financial Reporting Standards, as endorsed by the European
Union;
"Latest Practicable
Date"
has the meaning given to it in paragraph 1 of Appendix 2 to this Announcement;
"Lithuanian
Newco"
DLM Holdings JV, UAB, a private limited company incorporated in the Republic
of Lithuania;
"Loan
Note"
the unsecured £27,795,314 loan notes to be issued by Midco 1 pursuant to the
Loan Note Alternative;
"Loan Note
Alternative"
the alternative to the Cash Offer being the exchange of Xpediator Shares for
Loan Notes in lieu of part or all of the cash consideration to which Scheme
Shareholders would otherwise be entitled under the Cash Offer, as detailed in
paragraph 10 of this Announcement;
"London Stock
Exchange"
London Stock Exchange plc;
"Long Stop
Date"
6 December 2023, or such later date as may be agreed by Xpediator and Bidco
(with the Panel's consent and as the Court may approve, if such approval is
required);
"Meetings"
the Court Meeting and the General Meeting;
"Midco
1"
DLM Midco I Limited, a private limited company incorporated in England and
Wales, being the holding company of Midco 2;
"Midco
2"
DLM Midco II Limited, a private limited company incorporated in England and
Wales, being the holding company of Bidco;
"Nuoma IR
Kapitalas"
Nuoma IR Kapitalas UAB;
"Offer"
the direct or indirect offer by Bidco of the entire issued and to be issued
ordinary share capital of Xpediator not owned or controlled by Cogels
Investments, to be implemented by means of the Scheme (or by way of a Takeover
Offer under certain circumstances described in this Announcement) and, where
the context requires, any subsequent revision, variation, extension or renewal
thereof;
"Offer
Period"
the offer period (as defined by the Takeover Code) relating to Xpediator,
which commenced on 20 December 2022;
"Official
List"
the Official List maintained by the FCA;
"Opening Position
Disclosure"
has the same meaning as in Rule 8 of the Takeover Code;
"Overseas
Shareholders"
Xpediator Shareholders (or nominees of, or custodians or trustees for
Xpediator Shareholders) not resident in, or nationals or citizens of the
United Kingdom;
"Panel"
the Panel on Takeovers and Mergers;
"Phase II Investigation"
an in-depth investigation of the effects of the Offer on the relevant markets,
following completion of an initial review, as applicable under the laws of the
respective jurisdiction;
"Registrar of
Companies"
the Registrar of Companies in England and Wales;
"Regulatory Information
Service" a "primary
information provider" which has been approved by the FCA as such to
disseminate regulated information;
"Resolution(s)"
such shareholder resolution(s) of Xpediator as are necessary to approve,
implement and effect the Scheme, including (without limitation) a resolution
to make certain amendments to the articles of association of Xpediator;
"Restricted
Jurisdiction"
any jurisdiction where local laws or regulations may result in a material risk
of civil, regulatory or criminal exposure if information concerning the Offer
is sent or made available to Xpediator Shareholders in that jurisdiction;
"Rothschild &
Co"
N. M. Rothschild & Sons Limited;
"Scheme"
the proposed scheme of arrangement under Part 26 of the Companies Act between
Xpediator and Xpediator Shareholders in connection with the Offer, with or
subject to any modification, addition or condition approved or imposed by the
Court and agreed by Xpediator and Bidco;
"Scheme
Condition"
the Condition referred to in paragraph 2(c) of Part A of Appendix 1 to this
Announcement;
"Scheme
Document"
the document to be sent to Xpediator Shareholders containing, amongst other
things, the Scheme and the notices convening the Court Meeting and General
Meeting;
"Scheme Record
Time"
the time and date specified in the Scheme Document, expected to be 6:00 p.m.
on the Business Day immediately before the Effective Date;
"Scheme
Shares"
all Xpediator Shares:
(i) in issue at the date of the Scheme Document;
(ii) (if any) issued after the date of the Scheme Document and before the
Scheme Voting Record Time; and
(iii) (if any) issued at or after the Scheme Voting Record Time but on or
before the Scheme Record Time either on terms that the original or any
subsequent holders thereof are bound by the Scheme or in respect of which such
holders are, or shall have agreed in writing to be, so bound,
in each case other than any Excluded Shares;
"Scheme
Shareholder"
a holder of Scheme Shares;
"Scheme Voting Record
Time" the date
and time specified in the Scheme Document by reference to which entitlement to
vote at the Court Meeting will be determined, expected to be 6:00 p.m. on the
day which is two days before the Court Meeting or, if the Court Meeting is
adjourned, 6:00 p.m. on the day which is two days before the date of such
adjourned Court Meeting;
"Significant
Interest"
in relation to an undertaking, a direct or indirect interest of 20 per cent,
or more of the total voting rights conferred by the equity share capital (as
defined in section 548 of the Companies Act) of such undertaking;
"Special
Dividend"
a special dividend of 2 pence per Xpediator Share, which the Xpediator
Directors intend to declare in connection with the Offer;
"Takeover
Code"
the City Code on Takeovers and Mergers;
"Takeover
Offer"
a takeover offer as defined in Chapter 3 of Part 28 of the Companies Act;
"Third
Party"
each of a central bank, government or governmental, quasi-governmental,
supranational, statutory, regulatory, environmental, administrative, fiscal or
investigative body, court, trade agency, association, institution,
environmental body, employee representative body or any other body or person
whatsoever in any jurisdiction;
"United Kingdom" or
"UK"
the United Kingdom of Great Britain and Northern Ireland;
"United States" or
"US"
the United States of America, its territories and possessions, any state of
the United States of America, the District of Columbia and all other areas
subject to its jurisdiction and any political sub-division thereof;
"US Exchange
Act"
the United States Securities Exchange Act of 1934, as amended, and the rules
and regulations promulgated thereunder;
"US Securities
Act"
the United States Securities Act of 1933, as amended, and the rules and
regulations promulgated thereunder;
"Wider Bidco
Group"
Bidco, funds advised by BaltCap, Cogels Investments and their respective
associated undertakings and any other body corporate, partnership, joint
venture or person in which Bidco and all such undertakings (aggregating their
interests) have a Significant Interest;
"Wider Xpediator
Group"
Xpediator and associated undertakings and any other body corporate,
partnership, joint venture or person in which Xpediator and all such
undertakings (aggregating their interests) have a Significant Interest;
"Xpediator"
Xpediator Plc;
"Xpediator
Directors"
the directors of Xpediator;
"Xpediator
Group"
Xpediator and its subsidiary undertakings and where the context permits, each
of them;
"Xpediator Share
Plans"
the Xpediator PLC Company Share Option Plan 2020, the Xpediator PLC Company
Share Option Plan 2021 and the Xpediator Long Term Incentive Plan;
"Xpediator
Shareholders"
the holders of Xpediator Shares;
"Xpediator
Shares"
the existing unconditionally allotted or issued and fully paid ordinary shares
of 5 pence each in the capital of Xpediator and any further such ordinary
shares which are unconditionally allotted or issued before the Scheme becomes
Effective; and
"Zeus
Capital"
Zeus Capital Limited.
For the purposes of this Announcement, "subsidiary", "subsidiary undertaking",
"undertaking" and "associated undertaking" have the respective meanings given
thereto by the Companies Act.
All references to "pounds", "pounds Sterling", "Sterling", "£", "pence",
"penny" and "p" are to the lawful currency of the United Kingdom.
All the times referred to in this Announcement are London times unless
otherwise stated.
References to the singular include the plural and vice versa.
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