REG - ACG Acquisition Co. - Acquisition Announcement

ACG MetalsAnnouncement

12/06/2023 07:30

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RNS Number : 3809C  ACG Acquisition Company Limited  12 June 2023

THIS ANNOUNCEMENT CONTAINS INFORMATION THAT QUALIFIES OR MAY HAVE QUALIFIED AS
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JURISDICTION

THIS ANNOUNCEMENT IS NOT INTENDED TO CONSTITUTE, AND SHOULD NOT BE CONSTRUED
AS, AN OFFER TO SELL OR A SOLICITATION OF ANY OFFER TO BUY THE SECURITIES OF
THE COMPANY (AS DEFINED BELOW) IN ANY JURISDICTION

12 June 2023

ACG Acquisition Company Limited

("ACG" or the "Company")

ACG announces the creation of a major new force in global critical metals
focused on the western electric vehicle ("EV") value chain

·      Acquisition of two mines in Brazil from funds advised by Appian
Capital Advisory LLP ("Appian") for an enterprise value of $1.0 billion will
create a new leader in green critical metals supplying Stellantis, PowerCo
(wholly owned Volkswagen battery subsidiary), and other western EV
manufacturers

·      Nickel sulphide and copper concentrates produced at newly built,
cash-generative mines with industry-leading low carbon footprint and
best-in-class Environmental, Social and Governance ("ESG") standards

·      The Acquisition (as defined below) is supported by $100 million
commitments to subscribe for ACG equity from each of Glencore, Stellantis and
La Mancha, and a $100 million prepayment from PowerCo

·     ACG, to be renamed ACG Electric Metals Limited ("ACG Electric
Metals"), is ideally positioned to benefit from the EV revolution as supplier
of choice to the western automotive industry value chain

ACG has today agreed the acquisition of two cash-generative mining operations
in Brazil, producing nickel sulphide and copper concentrates with low carbon
emissions. Critical minerals mined at the Brazilian sites will be refined in
Europe and North America and then supplied to car manufacturers, fortifying
the EV supply chain in western countries.

The Atlantic Nickel nickel sulphide mine in Santa Rita and the Mineraçao Vale
Verde ("MVV") copper mine in Serrote will be acquired on a cash- and debt-free
basis from funds advised by Appian for an enterprise value of $1.0 billion(1)
(the "Acquisition"). Both mines are long-life, low-cost and ranked within the
first decile for carbon emissions amongst all nickel and copper producers
worldwide. They have a combined 2022 Adjusted EBITDA(2) of $260 million.

The transaction is backed by equity commitments (subject to customary closing
conditions, as applicable) from leading global investors: Glencore, Stellantis
and La Mancha. The transaction is also backed by other commitments from Royal
Gold (royalty financing), Citigroup, ING and Societe Generale (senior debt),
PowerCo (prepayment) and Appian (backstop to equity raise).

The Company, to be renamed ACG Electric Metals, will provide security of
supply, full supply-chain accountability and low carbon emissions products to
western EV manufacturers and other industrial customers. For investors, it
offers exposure to long-term demand generated by the global energy transition,
high-calibre management and governance, and a London-listed company with a
vision for continued growth and further consolidation in the critical metals
space. Its clear strategic focus is on the western EV supply chain.

Artem Volynets, CEO of ACG, said:

"We are very proud to announce this landmark transaction in strategic
partnership with Glencore, Stellantis, La Mancha, PowerCo and Royal Gold, as
well as senior debt providers Citigroup, ING and Societe Generale. It will
establish ACG Electric Metals as a premier supplier of critical metals into
the western EV value chain, with best-in-class ESG characteristics and minimal
CO(2) emissions.

ACG Electric Metals will be a company designed to take advantage of the
opportunities presented by key global trends: the massive increase in demand
for battery metals, the polarisation of supply chains, and the need to reduce
carbon emissions - from the mine to the end-customer.

These high-quality mines will enable ACG's mission to be the green metals
supplier of choice to western EV automakers. This acquisition establishes a
solid platform for further growth and long-term shareholder value creation."

Michael W. Scherb, Founder and CEO of Appian commented:

"Atlantic Nickel and MVV are market-leading assets, which Appian has optimized
through the strength of its operating model and its ability to identify,
acquire and develop mining projects having built and financed 9 mines into
production in the last 7 years. Now they are in production, ACG is the ideal
steward for their next phase of growth.

This transaction highlights the importance of robust, reliable and sustainable
supplies of EV commodities for western automotive OEMs and industry, a core
pillar of Appian's investment strategy.

By providing critical minerals for the energy transition and green tech, in
addition to value-add capital and technical support, Appian is strategically
positioned to capitalise on global trends in decarbonization."

Transaction Highlights

·      Global commodities group Glencore has committed to subscribe for
$100 million in ACG equity as anchor investor and will become an off-taker of
choice for ACG, allowing for supply of ACG Electric Metals' nickel sulphide
concentrate to Glencore's western European and North American refineries.

·      The mines' output is highly suitable for western automakers,
enabling them to maintain full visibility and security of supply across the
value chain, as demonstrated by commitments from the following leading western
car companies:

a)   Stellantis - one of the world's leading automakers and mobility
providers - has committed to subscribe for $100 million in ACG equity as
anchor investor (subject to customary closing conditions).

b)   PowerCo, a wholly owned subsidiary of Volkswagen, has committed to make
a $100 million prepayment to ACG for equivalent nickel units to the tonnage
contained in a portion of the concentrates produced by the Atlantic Nickel
mine at Santa Rita.

·      Leading mining investment fund, La Mancha Resource Fund ("La
Mancha"), has committed to subscribe for $100 million in ACG equity as anchor
investor (subject to customary closing conditions). La Mancha is advised by La
Mancha Resource Capital, a leading investment adviser focused on the precious
and energy transition metals sector that is authorised and regulated by the
FCA (FRN 978592).

·      Both Stellantis and La Mancha will have the right to nominate one
director each to the Board of ACG.

·      Royal Gold, a major precious metal stream and royalty investor,
has committed $250 million in royalty finance across both Atlantic Nickel and
MVV.

·      Citigroup, ING, and Societe Generale, three global financial
institutions with a long track record in Brazil and the mining sector, will be
acting as Coordinating Lead Arrangers and have underwritten $300 million in
senior debt through a $225 million term loan facility and a $75 million
revolving credit facility.

·      These investments and partnerships are designed to optimize the
mines' ability to meet future global demand, and to help address supply chain
challenges currently arising in global commodities.

·      As part of the transaction, ACG has reinforced its commitment to
sustainability practices at its mining sites by agreeing to implement the IRMA
Standard for Responsible Mining at the Santa Rita mine, and to undergo an IRMA
assessment in 2025 and 2030.

·      The mines' Competent Person's Reports ("CPRs") are published
alongside this announcement. These CPRs attribute an aggregate value of
greater than $2.0 billion to both assets as follows: $546 million for the
Santa Rita open pit mine, $942 million for the Santa Rita underground mine
(PEA)(3), and $540 million for the Serrote mine.(4)

·      Nickel sulphide is readily processed through a more
carbon-efficient route into high quality forms of nickel that are used in the
production of batteries for electric vehicles, while copper plays an essential
role throughout the global energy transition more broadly. Brazil is a
mining-friendly jurisdiction, well-integrated into the supply chains of
refineries and original equipment manufacturers ("OEMs") worldwide.

·      Upon the closing of the Acquisition, ACG Electric Metals will
be the only London-listed nickel sulphide producer with pure play electric
metals exposure - creating a natural platform for further M&A-led growth
and consolidation of critical metals assets focused on deliveries to leading
western OEMs.

·      ACG will continue to be led by its Chief Executive Officer, Artem
Volynets, and Carole Whittall as Chief Financial Officer. Mr Volynets has led
private and public transactions worth more than $30 billion and managed major
companies in the metals and mining industry. He leads a team with extensive
experience in the global mining sector, with a commitment to ESG principles
and transparent corporate governance.

·      Responsibility for the operation of the mines in Brazil will
continue to be held by Paulo Castellari-Porchia and Milson Mundim, who have
together for many years led a highly capable and experienced local management
team and achieved an excellent ESG, health and safety record. Following
completion, the operating team in its entirety will join ACG Electric Metals,
providing continuity and a solid basis for integrating future acquisitions.

·      As a part of the transaction, Appian will retain its 2.75% Net
Smelter Royalty ("NSR") on the Santa Rita mine and La Mancha will be granted a
2.5% NSR on production from the Santa Rita mine once 212,228,700 pounds of
nickel equivalent has been produced from 31 December 2022. Additionally, an
enterprise value of $65 million has been associated with Appian's contemplated
gold royalty on MVV that, while not in place upon closing of the Acquisition,
will be paid to Appian as a part of the consideration.

·      ACG has secured the following funding sources towards the
consideration required for the Acquisition:

a)   $250 million in binding royalty finance commitments from Royal Gold, a
leading global royalty company.

b)   $225 million in committed senior debt underwritten by a syndicate led
by Citigroup, ING and Societe Generale, who have also agreed to provide a $75
million revolving credit facility.

c)   $100 million in the form of a binding prepayment commitment from
PowerCo, a subsidiary of Volkswagen AG, for equivalent nickel units to the
tonnage contained in a portion of the concentrates produced by the Atlantic
Nickel mine at Santa Rita.

d)   Commitments to subscribe for $300 million in ACG equity (each subject
to customary closing conditions) from the following:

•  a commitment of $100 million from Glencore;

•  a commitment of $100 million from Stellantis; and

•  a commitment of $100 million from La Mancha.

·      ACG will conduct a c.$300 million equity offering (the "Equity
Offering") to fund the balance of the Acquisition consideration, repayment of
certain MVV debt obligations and certain transaction costs. Up to $50 million
of the planned Equity Offering is subject to a backstop by Appian.

·      The Equity Offering will enable a broader universe of
institutional investors to participate in the ownership of ACG, and is
expected to commence in late June 2023 and complete in mid-July 2023.

·      The proposed Acquisition, which is subject to obtaining the
approval of ACG's public shareholders at an extraordinary meeting expected to
be held on or about19 July 2023 and applicable regulatory approvals, is
currently expected to complete on or about 25 July 2023.(5)

1 Enterprise value of $1.0 billion plus $65 million associated with Appian's
contemplated gold royalty on MVV, for a total enterprise value of $1.065
billion, which is subject to a $100 million enterprise value to equity value
bridge.

2 "2022 Adjusted EBITDA" means profit before taxation, finance income/expense,
depreciation and amortization and the exclusion of the impact of certain items
due to their materiality and nature to aid comparability, for the financial
year ended 31 December 2022.

3 The Santa Rita underground mine NPV is based on a preliminary economic
assessment (PEA). Please consult the CPRs for more detail.

4 Post-tax NPV at 8% discount rate. The Serrote NPV includes the impact of a
35% gold revenue royalty (GRR) that was contemplated by funds managed by
Appian Capital at the time of preparation of the CPRs. Such royalty will not
be in place upon closing of the Acquisition.

5 All dates are indicative and subject to change.

Target Highlights

·      The Atlantic Nickel mine at Santa Rita possesses a rare nickel
sulphide resource, a key input into the class 1 nickel products used in EVs.
The mine possesses an attractive life of mine average C1 cash cost in the
first quartile of the global nickel cost curve (c. $3.16/lb nickel for open
pit; c. $2.02/lb nickel for underground). The operation currently comprises an
open pit mine which produced c. 15 kt of payable nickel equivalent in 2022,
with a planned expansion into an underground mine once the open pit reserves
are depleted. It plans for an average contained nickel equivalent production
of 31ktpa over a 33-year life of mine with an attractive average C1 cash cost
in the first quartile of the global nickel cost curve. The site benefits from
over $1 billion in historical capex since initial construction began in 2007.

·      The Mineraçao Vale Verde mine at Serrote operates a conventional
open pit mine and processing operation producing high quality copper-gold
concentrate. It plans for an average copper equivalent production of c. 20ktpa
over a 12-year life of mine, at an average C1 cash cost of $1.37/lb copper.
There is potential to significantly extend the life of mine through extension
of the mining deposit, which is already under assessment.

·      Taken together, the two operations exhibit a robust financial
profile with both attractive P/NAV and strong EV/EBITDA multiples that
outperform base metal peers(1): a P/NAV of 0.6x based on analyst consensus
forecasted commodity prices and 0.4x based on forward curve commodity prices,
below the peer average of 0.7x, and an EV/24E EBITDA of 4.2x  based on
analyst consensus forecasted commodity prices and 4.3x based on forward curve
commodity prices, below the peer average of 4.9x.

·      Both mines possess expansive land packages for further
exploration. The Santa Rita site contains 32 tenements covering c.36k
hectares, with a deposit already identified within a 25km radius. The Serrote
site containing 10 tenements covering c.14k hectares, with a preliminary
economic assessment currently underway for a deposit 15km from the existing
site.

·      Atlantic Nickel and MVV already possess strong ESG credentials.
Current owner Appian is a signatory to the United Nations Principles for
Responsible Investment ("UNPRI"), and has issued ESG reports following
Sustainable Accounting Standards Board ("SASB") guidelines. Under Appian's
management, both mines have a comprehensive Stakeholder Engagement Plan
("SEP"), aligned with internationally recognized standards and guidelines
including mining-specific frameworks from AccountAbility, the International
Council on Mining and Metals ("ICMM") and the International Finance
Corporation ("IFC").

1 Base metals peers include: Ero Copper, Independence Group, Mincor, Sandfire,
Capstone, Central Asia Metals, Taseko, Atalaya, 29Metals, Panoramic, and
Harita. Market data as at 2 June 2023. Source: Thomson One Analytics and
Factset..

About ACG

ACG is a company with a vision to consolidate the critical metals industry.
Through a series of roll-up acquisitions, ACG intends to become a premier
supplier of critical metals to the western OEM supply chain, with
best-in-class ESG and carbon footprint characteristics. On October 12, 2022,
ACG successfully raised proceeds of approximately $125 million in its initial
public offering, and listed on the London Stock Exchange (symbols: ACG and
ACGW).

The Company's co-sponsors are (1) ACG Mining Limited, a BVI business firm
whose main shareholder is Artem Volynets, (2) De Heerd Investments Limited, a
Hong Kong-based asset manager with an extensive track-record of global
investments and (3) Argentem Creek Partners LP, an emerging markets specialist
firm investing in special situations, private credit, high yield, and trade
finance.

For further information please visit:

www.acgcorp.co (http://www.acgcorp.co)

About Appian

Appian Capital Advisory LLP is the investment advisor to Appian Natural
Resources Fund I, Appian Natural Resources Fund II, Appian Natural Resources
Fund III and Appian Credit Strategies I (collectively, the "Appian Funds"),
which are private capital funds that invest in mining or mining related
companies.

Appian is a leading investment advisor in the metals and mining industry, with
global experience across South America, North America, Europe, Australia and
Africa and a successful track record of supporting companies to achieve their
development targets, with a global operating portfolio overseeing over ~6,300
employees. Appian offers its investors exposure to attractive mineral markets
via a unique technical and operating approach. Appian has offices in London,
Toronto, New York, Lima, Belo Horizonte, Montreal, Mexico City, Dubai and
Perth.

The Appian Funds acquired 100% ownership of each of the Santa Rita mine and
the Serrote mine in 2018. Appian has developed nine mines into production
since 2016, and this transaction marks its 10(th), 11(th) and 12(th) exits.

www.appiancapitaladvisory.com (http://www.appiancapitaladvisory.com)

 

Contacts for ACG

Palatine Communications - Communications Advisor

Conal Walsh / Andreas Grueter / Kelsey Traynor / Richard Seed

acg@palatine-media.com (mailto:acg@palatine-media.com)

 

Contacts for Appian

FGS Global - Communications Advisor

Charles O'Brien / Richard Crowley / Theo Davies-Lewis

AppianCapital-LON@fgsglobal.com

ADVISORS

Rothschild & Co is acting as sole financial advisor to ACG. Cleary
Gottlieb Steen & Hamilton LLP, Lefosse, and Harney Westwood & Riegels
LP are acting as legal advisors to ACG.

Citigroup and Standard Chartered are acting as financial advisor to Appian.
Norton Rose Fulbright and Cescon, Barrieu, Flesch & Barreto are acting as
legal advisors to Appian.

BMO, Citigroup, and RBC are acting as placement agents in connection with the
Acquisition and the proposed institutional offering of equity securities.
Latham & Watkins (London) LLP and Mattos Filho, Veiga Vilho, Marrey Jr. E
Quiroga Advogados are acting as legal advisors to BMO, Citigroup and RBC.

TRANSACTION STRUCTURE

The Acquisition

ACG has agreed to acquire (i) a 100% interest in Mirabela Participações
S.A., which holds a 100% interest in Atlantic Nickel Mineração Ltda., the
company operating the Santa Rita mine, (ii) a 100% interest in Serrote
Participações S.A, which holds a 100% interest in Mineração Vale Verde do
Brasil Ltda., the company operating the Serrote mine, (iii) 100% interests in
AMH (Jersey) Limited and AMH 2 (Jersey) Limited, which are parties to certain
intragroup loans and royalties (collectively, the "Targets") and (iv) certain
shareholder loans granted to the Targets by Appian entities. The purchase
price for the Acquisition will be paid in cash and will reflect certain
adjustments from the effective locked box date of 31 December 2022, until
closing. Following completion of the Acquisition, the Company and the Targets
will constitute a new group (the "Enlarged Group").

ACG has secured the following funding sources for the Acquisition:

(i)         $250 million in binding royalty finance commitments from
Royal Gold, a leading global royalty company (subject to customary closing
conditions).

(ii)        $225 million in committed senior debt, underwritten by a
syndicate led by Citigroup, ING and Societe Generale, who have also agreed to
provide a $75 million revolving credit facility.

(iii)       $100 million in the form of a binding prepayment commitment
from PowerCo, a subsidiary of Volkswagen AG, for equivalent nickel units to
the tonnage contained in a portion of the concentrates produced by the
Atlantic Nickel mine at Santa Rita.

(iv)       $100 million in ACG equity from Glencore as anchor investor
(subject to customary closing conditions), with Glencore agreeing to a
six-month lock-up, subject to certain customary exemptions.

(v)        $100 million in ACG equity from Stellantis as anchor
investor (subject to customary closing conditions), with Stellantis agreeing
to a six-month lock-up, subject to certain customary exemptions.

(vi)       $100 million in ACG equity from La Mancha as anchor investor
(subject to customary closing conditions), with La Mancha agreeing to a
six-month lock-up, subject to certain customary exemptions.

(vii)      An up to $50 million backstop to the planned Equity Offering
provided by Appian.

These funding sources do not include any excess cash in the Targets, which may
also be used to fund the Acquisition. They also exclude the proceeds of ACG's
initial public offering that are currently held in escrow (of $125 million).
Those proceeds will only be used to fund the Acquisition and other corporate
purchases to the extent not needed to finance the redemptions of ACG's class A
ordinary shares by its existing public shareholders (as defined in the UK
Financial Conduct Authority's (the "FCA") Listing Rules).

The planned Equity Offering

ACG intends to provide a broader universe of institutional investors with the
opportunity to participate in ACG Electric Metal's future value creation
through a planned Equity Offering of approximately $300 million to be placed
by a syndicate of banks led by BMO Capital Markets Limited ("BMO"), Citigroup,
and RBC Europe Limited ("RBC"). The offering is backstopped by Appian up to
$50 million.

The planned Equity Offering will fund the balance of the Acquisition
consideration, repayment of certain MVV debt obligations and certain
transaction costs.

The planned Equity Offering is planned to commence in late June, 2023 and
complete in mid-July, 2023.

Board Recommendation

The Board of Directors of ACG has unanimously approved the Acquisition and
intends to recommend that ACG's existing public shareholders vote in favour of
the Acquisition.

Closing Conditions

The closing of the Acquisition is subject to the satisfaction or waiver of
customary closing conditions, including the approval of the Acquisition by a
general meeting of ACG's shareholders, the clearance by the Brazilian
antitrust authority (Conselho Administrativo de Defesa Econômica) and the
re-admission of all of the class A ordinary shares and the warrants of the
Enlarged Group to listing, effective as of the closing date of the Acquisition
(see "Conditions Precedent" below).

1 Enterprise value of $1.0 billion plus $65 million associated with Appian's
contemplated gold royalty on MVV, for a total enterprise value of $1.065
billion, which is subject to a $100 million enterprise value to equity value
bridge.

 

Expected Timetable

 Transaction Announcement                                                     12 June 2023
 Transaction Update, including Q1 financial information and instructions for  16 June 2023
 existing ACG shareholders; commencement of redemption period
 Research publication                                                         16 June 2023
 Research analysts investor education                                         16 June - 29 June 2023
 Publication of prospectus, notice convening Acquisition EGM and shareholder  30 June 2023
 circular and launch of Equity Offering
 ACG Management Roadshow                                                      30 June - 14 July 2023
 Completion of Equity Offering                                                14 July 2023
 Redemption deadline for existing ACG shareholders                            17 July 2023
 Acquisition EGM                                                              19 July 2023
 Transaction completion, closing and settlement                               25 July 2023

 

The Acquisition is expected to close on 25 July 2023.

On or around 16 June 2023, ACG will publish on its website an update to the
market regarding the Acquisition, which will include (i) Q1 2023 financial
information for the Targets and (ii) a description of the various procedures
that must be complied with by existing public ACG shareholders to redeem their
shares in accordance with the redemption arrangements included in ACG's
Memorandum and Articles of Association. It is expected that the redemption
period for existing public ACG shareholders to exercise such redemption rights
will commence on such date (i.e., 16 June 2023) and expire on the second
business day prior to the Acquisition EGM (as defined below).

Following approval by the FCA of a prospectus containing further details
regarding the Acquisition, ACG intends to convene a general meeting of its
public shareholders for purposes of considering the Acquisition (the
"Acquisition EGM").

No later than fourteen calendar days prior to the date of the Acquisition EGM,
ACG will publish on its website the notice convening the Acquisition EGM, the
shareholder circular and any other related documents.

The Acquisition will be treated as a reverse takeover (as defined in the FCA's
Listing Rules). The Company has adopted, and maintains as of the date hereof,
a structure in compliance with FCA Listing Rule 5.6.18AG, as set out in the
prospectus published by ACG in connection with its IPO.

Effective as of the closing of the Acquisition, the existing listing of ACG's
class A ordinary shares and warrants will be cancelled. ACG will apply for the
re-admission of all of the class A ordinary shares and the warrants of the
Enlarged Group, effective as of the closing of the Acquisition, to the
standard listing segment of the Official List of the FCA and for all of the
class A ordinary shares and the warrants to be re-admitted to trading on the
London Stock Exchange.

The long stop date is 18 August 2023. If the Acquisition has not been
completed by that date, either party may terminate the Acquisition Agreement.

1 All dates are indicative and subject to change.

KEY TERMS OF THE ACQUISITION

Acquisition Agreement

Scope of the acquisition

ACG has agreed to acquire the Targets and ACG will acquire shareholder loans
granted from Appian and its affiliates to the Targets.

Warranties and indemnities

ACG is the beneficiary of a customary warranties package relating to, among
other things, accuracy of disclosure, capacity of the sellers, title over the
target shares, constitution and share capital of the Targets, accounts,
absence of material developments from the latest accounts, financing and other
material agreements, grants, compliance with law, litigation, anti-bribery,
permits, insolvency, related-party transactions, environmental matters, mining
matters, assets, insurance, employment, and taxation.

ACG also benefits from indemnities covering, among other things, all taxes
relating to the pre-completion period and a number of issues identified in the
course of the due diligence on the Targets, including certain outstanding
litigation and administrative proceedings.

The warranties and indemnities under the SPA are backed by a combination of
insurance cover and seller obligations totalling approx. US$400 million in
cover for ACG, and are subject to customary limitations and qualifications.

Transition arrangements

For 12 months after completion, specified Target employees will be made
available to Appian affiliates for a portion of their time in return for an
agreed fee, and certain Appian employees will be made available to the
Enlarged Group to respond to questions for purposes of assisting with the
transition.

ADDITIONAL INFORMATION

For further information on the Acquisition and the Santa Rita and Serrote
mines, please consult the CPRs and the acquisition presentation slide deck
available at www.acgcorp.co (http://www.acgcorp.co) in the section headed
"Acquisition Documents and Announcements".

The description of the transactions contained herein is only a high-level
summary. Additional information about the transactions will be provided in the
prospectus and the shareholder circular, which will be published in due
course.

The prospectus and the shareholder circular will include information required
by applicable law, including information that has not been included in this
announcement, in particular:  further details on the terms of the proposed
transaction, including the expected dilution effect on public shareholders
from securities held by ACG's directors and co-sponsors, or from new
securities issued or expected to be issued as part of the transaction, further
information relating to how the Targets have been valued by ACG and any other
material details and information relating to the Acquisition.

DISCLAIMER

This announcement is not for publication or distribution, directly or
indirectly, in or into Australia, Canada, Japan, the Republic of South Africa
or the United States or any other jurisdiction where to do so would constitute
a violation of the relevant laws of such jurisdiction. The distribution of
this announcement may be restricted by law in certain jurisdictions and
persons into whose possession any document or other information referred to
herein comes should inform themselves about and observe any such restriction.
Any failure to comply with these restrictions may constitute a violation of
the securities laws of any such jurisdiction.

These materials are not an offer for sale of securities in the United States
or in any other jurisdiction. The securities referred to herein have not been
and will not be registered under the U.S. Securities Act of 1933, as amended
(the "Securities Act"), or with any securities regulatory authority of any
state or other jurisdiction of the United States, and may not be offered,
sold, resold, pledged, delivered, assigned or otherwise transferred, directly
or indirectly, within the United States except pursuant to an effective
registration statement under the Securities Act, to persons reasonably
believed to be qualified institutional buyers ("QIBs") in reliance on Rule
144A of the Securities Act or another exemption from, or in a transaction not
subject to, the registration requirements of the Securities Act, in each case
in accordance with any applicable securities laws of any state of the United
States. There has been and will be no public offering of the securities in the
United States. Securities will also be offered and sold outside of the United
States in offshore transactions in compliance with Regulation S under the
Securities Act.

This announcement does not constitute an offer of securities to the public in
any member state of the European Economic Area (the "EEA") (each a "Member
State"), no action has been undertaken or will be undertaken to make an offer
to the public of securities requiring publication of a prospectus in any
Member State. This announcement is only addressed to and is only directed at
persons in Member States who are "qualified investors" ("Qualified Investors")
within the meaning of Article 2(e) of Regulation (EU) 2017/1129 (such
Regulation, together with any applicable implementing measures in the relevant
home Member State under such Regulation, the "Prospectus Regulation"). This
announcement and the information contained herein must not be acted on or
relied upon in any Member State by persons who are not Qualified Investors.
Any investment or investment activity to which this announcement relates is
only available to, and any invitation, offer or agreement to purchase,
subscribe or otherwise acquire the same will be engaged in only with,
Qualified Investors. For the purpose of this paragraph, the expression "offer
of securities to the public" means the communication in any form and by any
means of sufficient information on the terms of the offer and the securities
to be offered so as to enable the investor to decide to purchase or subscribe
for the securities and the expression "Prospectus Regulation" means Regulation
(EU) 2017/1129 and includes any amendments and relevant delegated regulations
thereto.

This announcement does not constitute an offer of securities to the public in
the United Kingdom. In the United Kingdom, this announcement is only addressed
to and directed at persons in the United Kingdom who are "qualified investors"
within the meaning of Article 2(e) of Regulation (EU) 2017/1129, as amended,
as it forms part of retained EU law by virtue of the European Union
(Withdrawal) Act 2018 (the "U.K. Prospectus Regulation"). In addition, this
announcement is being distributed to, and is only directed at, qualified
investors (i) who have professional experience in matters relating to
investments falling within the definition of "investment professionals" in
Article 19(5) of the Financial Services and Markets Act 2000 (Financial
Promotion) Order 2005, as amended (the "FPO"), (ii) who fall within Article
49(2)(a) to (d) of the FPO or (iii) to whom it may otherwise lawfully be
communicated (all such persons, together with "qualified investors" within the
meaning of Article 2(e) of the U.K. Prospectus Regulation, being referred to
as "Relevant Persons"). This announcement and the information contained herein
must not be acted on or relied upon in the United Kingdom, by persons who are
not Relevant Persons. Any investment or investment activity to which this
announcement relates is available only to, and any invitation, offer or
agreement to subscribe, purchase or otherwise acquire the same will be engaged
in only with, Relevant Persons. For the purpose of this paragraph, the
expression "offer of securities to the public" means the communication in any
form and by any means of sufficient information on the terms of the offer and
the securities to be offered so as to enable the investor to decide to
purchase or subscribe to the securities.

Securities of the Company have not been and will not be registered under the
applicable securities laws of Australia, Canada, Japan of the Republic of
South Africa and, subject to certain exceptions, may not be offered or sold
within Australia, Canada, Japan or the Republic of South Africa except under
circumstances which will result in the full compliance with the applicable
laws and regulations promulgated by the relevant regulatory authorities in
effect at the relevant time.

Forward-looking statements

Some of the information in these materials may contain projections or other
forward-looking statements regarding future events or the future financial
performance of ACG and the Enlarged Group. You can identify forward looking
statements by terms such as "expect", "believe", "anticipate", "estimate",
"intend", "will", "could", "may" or "might" the negative of such terms or
other similar expressions. ACG wishes to caution you that these statements are
only predictions and that actual events or results may and often do differ
materially. ACG does not intend to update these statements to reflect events
and circumstances occurring after the date hereof or to reflect the occurrence
of unanticipated events. Any forward-looking statements reflect ACG's current
view with respect to future events and many factors could cause the actual
results to differ materially from those contained in projections or
forward-looking statements of ACG, including, among others, ACG's ability to
obtain adequate information to evaluate the target assets, ACG's ability to
successfully or timely complete the contemplated acquisition, ACG's and
Appian's expectations around the performance of the target assets, ACG's
success in retaining or recruiting, or changes required in, ACG's officers,
key employees or directors following the contemplated acquisition, ACG's
officers and directors allocating their time to other businesses and
potentially having conflicts of interest with the Company's business or in
approving the contemplated acquisition, ACG's public securities' potential
liquidity and trading, the lack of a market for ACG's securities, ACG's
potential ability to obtain additional financing to complete the contemplated
acquisition and the financial performance of the enlarged group that would
result from the potential completion of the contemplated acquisition.
Forward-looking statements speak only as of the date they are made.

Inside information

This announcement contains inside information for the purposes of the UK
Market Abuse Regulation. The person responsible for the release of this
information on behalf of the Company is Artem Volynets, Chief Executive
Officer.

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