NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, DIRECTLY OR INDIRECTLY, IN WHOLE OR IN PART, IN, INTO OR FROM ANY JURISDICTION WHERE TO DO SO WOULD CONSTITUTE A VIOLATION OF THE RELEVANT LAWS OR REGULATIONS OF SUCH JURISDICTION. PLEASE SEE THE IMPORTANT NOTICES AT THE END OF THIS ANNOUNCEMENT. ANY FAILURE TO COMPLY WITH THIS RESTRICTION MAY CONSTITUTE A VIOLATION OF
FOR IMMEDIATE RELEASE
25 March 2024
RECOMMENDED FINAL CASH OFFER
for
Smart Metering Systems plc ("SMS")
by
Sienna Bidco Limited ("Bidco")
a newly formed company wholly-owned by funds advised by Kohlberg Kravis Roberts & Co. L.P. and its affiliates
CANCELLATION OF ADMISSION TO TRADING ON AIM OF SMS SHARES AND COMPULSORY ACQUISITION PROCEDURE
Introduction
On 7 December 2023, the boards of directors of SMS and Sienna Bidco Limited ("Bidco"), a newly formed company wholly-owned by funds advised by Kohlberg Kravis Roberts & Co. L.P. and its affiliates, announced that they had reached agreement on the terms and conditions of a recommended cash acquisition by Bidco of the entire issued and to be issued ordinary share capital of SMS (the "Acquisition"), to be effected by means of a Court-sanctioned scheme of arrangement (the "Scheme") under Part 26 of the Companies Act 2006 (the "Companies Act").
On 18 January 2024, Bidco announced that Bidco had determined, with the consent of SMS and the Takeover Panel, to implement the Acquisition by way of a recommended takeover offer (as defined in section 974 of the Companies Act) (a "Takeover Offer") rather than by way of the Scheme. Under the terms of the Takeover Offer, Bidco continues to offer SMS Shareholders 955 pence in cash for each SMS Share (the "Offer").
On 24 January 2024, the full terms and conditions of the Takeover Offer and the procedures for acceptance (the "Offer Document"), together with the related Form of Acceptance, were published and posted to SMS Shareholders (and for information purposes, to holders of options under the SMS Share Plans and persons with information rights). The Offer Document and the Form of Acceptance are available, subject to certain restrictions relating to persons resident in Restricted Jurisdictions, at SMS's website at https://www.sms-plc.com/
This announcement should be read in conjunction with the full text of the Offer Document. Capitalised terms used in this announcement shall, unless otherwise defined, have the same meanings as set out in the Offer Document. Unless otherwise stated, all times referred to in this announcement are to
SMS Shareholders are reminded that Bidco declared the Offer unconditional on 22 March 2024.
Acceptance level update
In accordance with Rule 17 of the Takeover Code, Bidco is pleased to announce that, as at 6.00 p.m. (
So far as Bidco is aware, as informed by SMS, included within the above are Valid Acceptances in respect of 141,341 SMS Shares (representing, in aggregate, approximately 0.1 per cent. of SMS's existing issued share capital) which were the subject of irrevocable undertakings in favour of Bidco to accept (or procure the acceptance of) the Offer, as given by the SMS Directors in respect of their own beneficial holdings of SMS Shares.
As at 6.00 p.m. (
The percentages of SMS Shares referred to in this announcement are based on figures of 138,134,520 SMS Shares in issue as at close of business in
Cancellation of admission to trading on AIM and re-registration
As the Takeover Offer has been declared unconditional and Bidco now has, by virtue of acceptances of the Takeover Offer or otherwise, acquired, or agreed to acquire, SMS Shares carrying not less than 75 per cent. of the voting rights then exercisable at a general meeting of SMS Shareholders, Bidco will procure that SMS makes an application to the London Stock Exchange for the cancellation of the admission to trading of SMS Shares on AIM.
In accordance with the Offer Document and the AIM Rules, a notice period of no less than 20 Business Days shall apply in respect of the cancellation of the admission to trading of SMS Shares on AIM. SMS will make a further announcement in respect of the expected cancellation date as soon as possible.
As soon as possible after the cancellation of the admission to trading of SMS Shares on AIM, it is intended that SMS will be re-registered as a private limited company.
Such cancellation of admission to trading on AIM of SMS Shares and re-registration of SMS as a private limited company would significantly reduce the liquidity and marketability of any SMS Shares in respect of which the Takeover Offer has not been accepted at that time and their value may be affected as a consequence.
Compulsory acquisition
In addition, as the Takeover Offer has been declared unconditional and Bidco now has, by virtue of acceptances of the Takeover Offer or otherwise, acquired, or agreed to acquire, SMS Shares carrying not less than 90 per cent. of the voting rights then exercisable at a general meeting of SMS Shareholders, Bidco will shortly begin the implementation of the compulsory acquisition procedure to acquire any remaining SMS Shares in respect of which the Offer has not been accepted under Chapter 3 of Part 28 of the Companies Act, as contemplated by the Offer Document.
Bidco will, shortly, pursuant to sections 979 and 980 of the Companies Act, dispatch formal compulsory acquisition notices (the "Notices") to those SMS Shareholders who have not yet accepted the Offer (the "Non-Assenting Shareholders"). The Notices will set out Bidco's intention to acquire any remaining SMS Shares in respect of which the Offer has not been accepted on a compulsory basis on the same terms as the Offer.
On the expiry of six weeks from the date of the Notices, unless a Non-Assenting Shareholder has applied to the Court and the Court orders otherwise, the SMS Shares held by the Non-Assenting Shareholders will be acquired compulsorily by Bidco on the same terms as the Offer. The consideration to which those SMS Shareholders will be entitled will be held by SMS on trust on behalf of those SMS Shareholders who have not accepted the Offer.
SMS Board changes
Two representatives of KKR, Andrew Furze and Yimei Luo, were appointed as non-executive directors to the SMS Board on 22 March 2024.
Andrew Furze joined KKR in 2021 and is Managing Director in the Infrastructure team. Prior to joining KKR, Mr. Furze spent fourteen years at Macquarie, where he was a managing director focused on the European infrastructure sector. He holds a BSc. in Economics from the London School of Economics and Political Science and an MSc. in Finance from INSEAD.
Yimei Luo joined KKR in 2016 and is Director on the Infrastructure team, focusing on investments across
In addition, Ruth Leak, James Richards and Mike Winkel each stepped down as an independent non-executive director of SMS on 22 March 2024.
Interests in securities
As at the close of business in
Name |
Nature of interest |
Number of SMS Shares |
Percentage of SMS's issued share capital |
Calvert Research and Management |
Ownership of SMS Shares |
104,045 |
0.08 |
Save as disclosed in this announcement, as at the close of business in
· had any interest in, or right to subscribe in respect of, any relevant SMS securities;
· had any short position (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 any right to require another person to take purchase or take delivery of relevant SMS securities;
· had procured an irrevocable commitment or letter of intent to accept the terms of the Offer in respect of relevant SMS securities; or
· had borrowed or lent any relevant SMS securities, save for any borrowed shares which have been either on-lent or sold.
Offer remains open and action to be taken
The Offer will remain open for acceptance until further notice. At least 14 calendar days' notice will be given by an announcement before the Offer is closed. SMS Shareholders who have not yet accepted the Offer are urged to do so as soon as possible in accordance with the following procedures:
· To accept the Takeover Offer in respect of SMS Shares in certificated form (that is, not in CREST), you must complete and return the Form of Acceptance accompanying the Offer Document, along with your share certificate(s) and/or other document(s) of title, to Computershare Investor Services PLC, Corporate Actions Projects,
· Acceptances in respect of SMS Shares in uncertificated form (that is, in CREST) should be made electronically through CREST so that the TTE instruction settles as soon as possible. Further details relating to the procedure for acceptance of the Offer in respect of such uncertificated SMS Shares are set out in section 12.2 of Part I of the Offer Document. If you are a CREST sponsored member, you should refer to your CREST sponsor as only your CREST sponsor will be able to send the necessary TTE instruction to Euroclear.
Full details on how to accept the Offer are set out in section 12 of Part 1 of the Offer Document.
Settlement
Settlement of the consideration to which any SMS Shareholder is entitled under the Offer will be effected in respect of further acceptances received while the Offer remains open, complete in all respects, within 14 calendar days of such receipt, save for those SMS Shareholders who acquired their SMS Shares on or after the Offer being declared unconditional, pursuant to options or awards granted under the SMS Share Plans, or who hold their SMS Shares through the SMS SIP trust. Those SMS Shareholders should refer to the provisions at section 13.3 of Part I of the Offer Document.
SMS Shareholders should note that if they accept the Offer while the Offer remains open, they will receive the consideration in respect of their SMS Shares within 14 calendar days of receipt of such acceptance. However, for any SMS Shares which Bidco compulsorily acquires, the Non-Assenting Shareholders will not receive their consideration until the completion of the compulsory acquisition procedure, which is expected to take a minimum of six weeks from the posting of the Notices.
Questions
If SMS Shareholders have any questions about this announcement or the Offer Document, or are in any doubt as to how to complete the Form of Acceptance, please contact the Shareholder Helpline operated by Computershare, the receiving agent in respect of the Takeover Offer, on +44 (0)370 707 4087. Please use the country code if calling from outside the
Enquiries
Morgan Stanley (Joint Financial Adviser to KKR) Shirav Patel / Francesco Puletti / Andrew Foster / George Chalaris / Nagib Ahmad |
+44 (0) 20 7425 8000 |
Macquarie Capital (Joint Financial Adviser to KKR) Adam Hain / Ashish Mehta
|
+44 (0) 20 3037 2000 |
FGS Global (PR Adviser to KKR) Faeth Birch / Alastair Elwen / Sophia Johnston |
+44 (0) 20 725 13801 |
Smart Metering Systems plc Miriam Greenwood, Chairman / Tim Mortlock, Chief Executive Officer / Gail Blain, Chief Financial Officer / Dilip Kejriwal, Head of Investor Relations
|
+44 (0) 141 249 3850 |
RBC Capital Markets (Joint Financial Adviser and Joint Broker to SMS) Mark Preston / Evgeni Jordanov / Matthew Coakes / Sam Jackson |
+44 (0) 20 7653 4000 |
Investec Bank plc (Joint Financial Adviser and Joint Broker to SMS) Chris Baird / Henry Reast / James Rudd / Shalin Bhamra |
+44 (0) 20 7597 5970 |
Cavendish Securities plc (Nomad and Joint Broker to SMS) Neil McDonald / Peter Lynch / Adam Rae |
+44 (0) 131 220 6939 |
Instinctif Partners (Public Relations Adviser to SMS) Tim Linacre / Guy Scarborough |
+44 (0) 7949 939 237 +44 (0) 7917 178 920 |
Simpson Thacher & Bartlett LLP is acting as legal adviser to KKR and Bidco.
Hogan Lovells International LLP is acting as legal adviser to SMS.
The following disclosures are made pursuant to Schedule 2 paragraph (g) of the AIM Rules.
Andrew Furze, age 37, holds / held the following directorships and/or partnerships:
Current Directorships / Partnerships |
Former Directorships / Partnerships (within the last 5 years) |
Sienna Midco 2 Limited Sienna Midco 3 Limited Sienna Bidco Limited Aqueduct Bidco Limited John Laing Group Limited Nimbus Kohlberg Kravis Roberts & Co Partners LLP Caruna Networks Oy |
Stallion Topco Limited Stallion Holdco Limited Stallion Parentco Limited Stallion Bidco Limited Nimbus Glasfaser Deutschland Glasfaser Direkt GmbH |
Yimei Luo, age 37, holds / held the following directorships and/or partnerships:
Current Directorships / Partnerships |
Former Directorships / Partnerships (within the last 5 years) |
Kohlberg Kravis Roberts & Co Partners LLP Q Park B.V.
|
|
There are no further disclosures required under Schedule 2 paragraph (g) of the AIM Rules.
Important Notices
RBC Europe Limited (trading as RBC Capital Markets), which is authorised by the Prudential Regulatory Authority ("PRA") and regulated by the Financial Conduct Authority ("FCA") and the PRA in the
Investec, which is authorised by the PRA and regulated by the FCA and PRA in the
Cavendish, which is authorised and regulated in the
Morgan Stanley & Co. International plc ("Morgan Stanley") which is authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority in the
Macquarie Capital (
Further Information
This announcement is for information purposes only and does not constitute or form any part of an offer to sell or subscribe for or an invitation to purchase or subscribe for any securities or the solicitation of an offer to buy any securities, pursuant to the Acquisition or otherwise. The Acquisition shall be made solely by means of the Offer Document which, together with the Form of Acceptance, shall contain the full terms and Conditions of the Acquisition, including details of how to accept the Takeover Offer. SMS Shareholders are strongly advised to read the formal documentation in relation to the Takeover Offer once it has been dispatched. Each SMS Shareholder is urged to consult its independent professional adviser immediately regarding the tax consequences to it (or its beneficial owners) of the Acquisition.
The statements contained in this announcement are made as at the date of this announcement, unless some other time is specified in relation to them, and publication of this announcement shall not give rise to any implication that there has been no change in the facts set forth in this announcement since such date.
This announcement has been prepared for the purpose of complying with English and Scots law and the Takeover Code and the 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 of
This announcement does not constitute a prospectus or prospectus equivalent document.
Overseas Shareholders
The release, publication or distribution of this announcement in or into certain jurisdictions other than the
The availability of the Takeover Offer to SMS Shareholders who are not resident in and citizens of the
Unless otherwise determined by Bidco or required by the Takeover Code, and permitted by applicable law and regulation, the Takeover Offer may not be made directly or indirectly, in or into, or by the use of mails or any means or 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 and the Offer may not be capable of acceptance by any such use, means, instrumentality or facilities. Copies of this announcement and any formal documentation relating to the Takeover Offer are not being, and must not be, directly or indirectly, mailed or otherwise forwarded, distributed or sent in or into or from any Restricted Jurisdiction and persons receiving such documents (including, without limitation, agents, custodians, nominees and trustees) must not mail or otherwise forward, distribute or send them in or into or from any Restricted Jurisdiction. Doing so may render invalid any related purported acceptance of the Takeover Offer.
This announcement does not constitute an offer or invitation to purchase or subscribe for any securities or a solicitation of an offer to buy any securities pursuant to this announcement or otherwise in any jurisdiction in which such offer or solicitation is unlawful.
The Acquisition shall be subject to the applicable requirements of the Takeover Code, the Panel, the London Stock Exchange, the Financial Conduct Authority and the AIM Rules. Further details in relation to Overseas Shareholders will be contained in the Offer Document.
Additional Information for US Investors
The Takeover Offer relates to the shares of a Scottish company and is being made by means of a contractual takeover offer under the Takeover Code and under English and Scots law. The Offer is being made in
Certain financial information included in this announcement and the Offer Document has been or will have been prepared in accordance with generally accepted accounting standards applicable in the
To the extent permitted by the Takeover Code and applicable law, in accordance with normal
Neither the
It may be difficult for US SMS Shareholders to enforce their rights and claims arising out of the US federal securities laws in connection with the Takeover Offer, since Bidco and SMS 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 SMS Shareholders 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 jurisdiction and judgement.
The receipt of cash pursuant to the Takeover Offer by a US SMS Shareholder as consideration for the transfer of its SMS Shares pursuant to the Takeover Offer will likely be a taxable transaction for
Forward Looking Statements
This announcement (including information incorporated by reference in this announcement), oral statements made regarding the Acquisition, and other information published by KKR, Bidco or SMS may contain statements about Bidco and SMS 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", "shall", "should", "anticipates", "estimates", "projects", "is subject to", "budget", "scheduled", "forecast" 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 SMS's operations and potential synergies resulting from the Acquisition; and (iii) the effects of government regulation on Bidco's or SMS's business.
Such forward looking statements are prospective in nature and are not based on historical facts, but rather on current expectations and projections of the management of Bidco and SMS about future events, and are therefore subject to 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, including: increased competition, the loss of or damage to one or more key customer relationships, changes to customer ordering patterns, delays in obtaining customer approvals for engineering or price level changes, the failure of one or more key suppliers, the outcome of business or industry restructuring, the outcome of any litigation, changes in economic conditions, currency fluctuations, changes in interest and tax rates, changes in raw material or energy market prices, changes in laws, regulations or regulatory policies, developments in legal or public policy doctrines, technological developments, the failure to retain key management, or the timing and success of future acquisition opportunities or major investment projects. Other unknown or unpredictable factors could cause actual results to differ materially from those in the forward looking statements. Such forward looking statements should therefore be construed in the light of such factors. Neither Bidco nor SMS, nor any of their respective associates or directors, officers or advisers, provides any representation, assurance or guarantee that the occurrence of the events expressed or implied in any forward looking statements in this announcement will actually occur. 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 hereof. All subsequent oral or written forward looking statements attributable to any member of the Bidco Group or the SMS Group, or any of their respective associates, directors, officers, employees or advisers, are expressly qualified in their entirety by the cautionary statement above.
Bidco and SMS expressly disclaim any obligation to update any forward looking or other statements contained herein, except as required by applicable law or by the rules of any competent regulatory authority, whether as a result of new information, future events or otherwise.
Electronic Communications
Please be aware that addresses, electronic addresses and certain information provided by SMS Shareholders, persons with information rights and other relevant persons for the receipt of communications from SMS 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.
Publication on Website and Availability of Hard Copies
A copy of this announcement and the documents required to be published by Rule 26 of the Takeover Code shall be made available subject to certain restrictions relating to persons resident in Restricted Jurisdictions on SMS's website at www.sms-plc.com by no later than 12 noon (
In accordance with Rule 30.3 of the Takeover Code, SMS Shareholders, persons with information rights and participants in the SMS Share Plans may request a hard copy of this announcement by contacting Computershare Investor Services PLC during business hours on +44 (0)370 707 4087 or by submitting a request in writing to Registrar at Computershare Investor Service PLC, The Pavilions, Bridgwater Road,
General
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 independent financial adviser duly authorised under FSMA if you are resident in the
Rounding
Certain figures included in this announcement have been subjected to rounding adjustments. Accordingly, figures shown for the same category presented in different tables or forms may vary slightly and figures shown as totals in certain tables or forms may not be an arithmetic aggregation of the figures that precede them.
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