REG - Chamberlin PLC - Placing and Subscription

ChamberlinAnnouncement

09/01/2024 08:15

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RNS Number : 0152Z  Chamberlin PLC  09 January 2024

THIS ANNOUNCEMENT (THE "ANNOUNCEMENT"), AND THE INFORMATION CONTAINED IN IT,
IS RESTRICTED AND IS NOT FOR RELEASE, PUBLICATION, DISTRIBUTION OR FORWARDING,
IN WHOLE OR IN PART, DIRECTLY OR INDIRECTLY, IN, INTO OR FROM THE UNITED
STATES, AUSTRALIA, CANADA, JAPAN, NEW ZEALAND, THE REPUBLIC OF SOUTH AFRICA OR
ANY OTHER STATE OR JURISDICTION WHERE TO DO SO WOULD CONSTITUTE A VIOLATION OF
THE RELEVANT LAWS OR REGULATIONS OF THAT JURISDICTION. PLEASE SEE THE
IMPORTANT NOTICES AT THE END OF THIS ANNOUNCEMENT.

 

THIS ANNOUNCEMENT IS FOR INFORMATION PURPOSES ONLY AND DOES NOT CONSTITUTE OR
CONTAIN ANY INVITATION, SOLICITATION, RECOMMENDATION, OFFER OR ADVICE TO ANY
PERSON TO SUBSCRIBE FOR, OTHERWISE ACQUIRE OR DISPOSE OF ANY SECURITIES IN
CHAMBERLIN PLC OR ANY OTHER ENTITY IN ANY JURISDICTION. NEITHER THIS
ANNOUNCEMENT NOR THE FACT OF ITS DISTRIBUTION SHALL FORM THE BASIS OF, OR BE
RELIED ON IN CONNECTION WITH, ANY INVESTMENT DECISION IN RESPECT OF CHAMBERLIN
PLC.

 

THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION AS STIPULATED UNDER THE MARKET
ABUSE REGULATION (EU NO. 596/2014) AS IT FORMS PART OF UK DOMESTIC LAW BY
VIRTUE OF THE EUROPEAN UNION (WITHDRAWAL) ACT 2018 (AS AMENDED) ("MAR"). UPON
THE PUBLICATION OF THIS ANNOUNCEMENT VIA A REGULATORY INFORMATION SERVICE,
THIS INSIDE INFORMATION IS NOW CONSIDERED TO BE IN THE PUBLIC DOMAIN.

 

9 January 2024

Chamberlin plc

("Chamberlin", the "Company" or the "Group")

 

Placing and Subscription

 

Chamberlin plc (AIM: CMH.L), the specialist castings and engineering group, is
pleased to announce that it has conditionally raised £830,000 (before
expenses), pursuant to a placing of 31,350,000 new Ordinary Shares of 0.1p
each (the "Placing Shares") at a placing price of 2.00 pence per share (the
"Placing Price") with certain existing institutional and other investors (the
"Placing") and subscriptions for, in aggregate, 10,150,000 new Ordinary Shares
of 0.1p each (the "Subscription Shares") at the Placing Price by Trevor Brown,
Executive Director, and certain other investors (the "Subscription") (the
Subscription Shares together with the Placing Shares, the "New Ordinary
Shares", and the Subscription and the Placing, together, the "Fundraising").

 

Cavendish Capital Markets Limited ("Cavendish") and Peterhouse Capital Limited
("Peterhouse") acted as joint bookrunners to the Placing ("Joint
Bookrunners").

 

The Placing Price represents a discount of approximately 29.82 per cent. to
the closing mid-market price of 2.85 pence per Ordinary Share on 8 January
2024 (being the last business day before the release of this Announcement).

 

The net proceeds from the Fundraising will provide working capital to support
the continued delivery of the Group's growth strategy across all three of its
business divisions and to strengthen the Group's balance sheet.

 

The Company has the authority to issue and allot the New Ordinary Shares
pursuant to certain existing shareholder authorities granting such powers to
the directors at the Company's Annual General Meeting held on 3 January 2024.

 

 

Enquiries:

 

 Chamberlin plc                                                            T: 01922 707100

 Kevin Price, Chief Executive Officer

 Alan Tomlinson, Finance Director

 Cavendish Capital Markets Limited (Nominated Adviser and Joint Broker)    T: 020 7220 0500

 Katy Birkin

 Stephen Keys

 George Lawson

 Peterhouse Capital Limited (Joint Broker)                                 T: 020 7469 0930

 Lucy Williams

 Duncan Vasey

 

This Announcement is released by Chamberlin plc and contains inside
information for the purposes of Article 7 of MAR, and is disclosed in
accordance with the Company's obligations under Article 17 of MAR.

 

Market soundings (as defined in MAR) were taken in respect of the Placing with
the result that certain persons became aware of inside information (as defined
in MAR), as permitted by MAR.  This inside information is set out in this
Announcement. Therefore, those persons that received inside information in a
market sounding are no longer in possession of such inside information
relating to the Company and its securities.

 

For the purposes of MAR, Article 2 of Commission Implementing Regulation (EU)
2016/1055 and the UK version of such implementing regulation (as
amended), the person responsible for arranging for the release of this
Announcement on behalf of the Company is Kevin Price, Chief Executive
Officer.

 

 

1.            Background and Reasons for the Fundraising and Use of
Proceeds

 

The Company reported its full year results on 30 November 2023 for the year
ended 31 May 2023 ("FY23") and these reflected both the continuing strong
performances of Russell Ductile Castings Ltd ("RDC") and Petrel Limited
("Petrel") and the ongoing turnaround at Chamberlin & Hill Castings Ltd
("CHC"). FY23 revenue of £20.7 million was 23% higher than the previous
financial year, profit before tax was £38,000, an improvement of 107%
year-on-year and the underlying operating loss was reduced by 17% to £0.6
million.

 

Since the year-end, the Group has continued to perform well. CHC has won a
number of new long-term contracts, including, as announced on 22 June 2023,
one with a leading European automotive industry components supplier. These
contracts in aggregate are estimated to be worth a total of €14 million of
revenue over their lifetime with production starting in Summer 2024.
Furthermore, the Company had a record order intake in November 2023, with RDC
winning new blue chip customer contracts with J.C. Bamford Excavators (JCB),
Nissan, Volvo, Tekmar and Steel Dynamics.

 

The Board is confident that the Group's three divisions will continue to grow
in the medium term. Focus is being placed on increasing marketing and export
sales at Petrel in order to maintain the 18% year-on-year revenue growth
achieved in FY23, and both RDC and CHC are currently looking to enter new
sub-sectors within their respective markets. RDC is investing in the
development of steel production, a more specialised sector of the casting
market which the Board believes has limited competition in the UK and will
generate higher gross margins. CHC is investing in the introduction of
Spheroidal Graphite iron, production, a form of ductile iron. Spheroidal
Graphite iron is estimated to be approximately 70% of the total cast iron
market for industrial applications, and therefore having the capability to
produce this will expose CHC to a significantly larger market opportunity.

 

The Board is anticipating a further increase in revenue of between 15% and 20%
and profit after tax of between £0.8 million and £1.0 million in FY24. The
Group has the installed capacity to grow organically to an estimated £45-50
million in revenue with limited requirements for further large-scale capital
investment. The Board's strategy in the short term is to focus on the
successful turnaround, growth, and operational improvements within the Group's
current portfolio of companies - optimising each business to its full
potential, building a solid base and strong balance sheet. Over the medium
term, this stronger financial footing is expected to provide the Group with
the platform to grow further through strategic industrial acquisitions, where
management can deliver high level value through operational improvements.

 

As stated in the FY23 annual report, the Board continues to review the various
options available to support the Group's working capital requirements. Cash
outflow in FY23 improved by 94% and in September 2023, the Company agreed a
Time To Pay arrangement with HMRC in relation to PAYE arrears of £1.7 million
over the following 12 months, which are expected to be paid in full in
September 2024, thus improving the Group's cash flow from that date. In
addition, the Group's pension deficit has been reduced from £5.5 million in
May 2021 to approximately £1.2 million currently with the deficit recovery
plan reduced from 13 years to 4 years.

 

In order to provide working capital support to continue the growth plans of
each of the Group's divisions, and also to strengthen the Group's balance
sheet in the short term, the Company has conditionally raised £830,000
(before expenses) through the Fundraising.

 

 

2.            Details of the Placing and Subscription

 

The Company has conditionally raised, in aggregate, £830,000 (before
expenses), pursuant to a placing of 31,350,000 Placing Shares at the Placing
Price with certain existing institutional and other investors and
subscriptions for 10,150,000 Subscription Shares at the Placing Price by
Trevor Brown, Executive Director, and certain other investors.

 

The Placing has not been underwritten and is conditional, inter alia, upon
admission of the Placing Shares to trading on AIM becoming effective in
accordance with the AIM Rules for Companies ("Admission") and occurring by not
later than 8.00 a.m. on 15 January 2024.

 

Together, the total number of New Ordinary Shares to be issued pursuant to the
Placing and Subscription, being 41,500,000 New Ordinary Shares, represent
approximately 30.10 per cent. of the Company's issued share capital as at the
date of this Announcement. The Company has the authority to issue and allot
the New Ordinary Shares pursuant to certain existing shareholder authorities
granting such powers to the directors at the Company's Annual General Meeting
held on 3 January 2024.

 

The New Ordinary Shares will, when issued, be credited as fully paid up and
will be issued subject to the Articles and rank pari passu in all respects
with the Company's existing Ordinary Shares, including the right to receive
all dividends and other distributions declared, made or paid on or in respect
of the Ordinary Shares after the date of issue of the New Ordinary Shares, and
will on issue be free of all claims, liens, charges, encumbrances and
equities.

 

Application has been made to the London Stock Exchange for the Admission of
the New Ordinary Shares to trading on AIM. It is expected that Admission will
occur on or around 8.00 a.m. on 15 January 2024 (or such later time and/or
date as Cavendish and Peterhouse may agree with the Company, being not later
than 8.00 a.m. on 31 January 2024).

 

Following Admission, the total number of Ordinary Shares in the capital of the
Company in issue will be 179,353,677 with each Ordinary Share carrying the
right to one vote. There are no Ordinary Shares held in treasury and therefore
the total number of voting rights in the Company is 179,353,677 (the "Enlarged
Share Capital"). The above figure may be used by shareholders in the Company
as the denominator for the calculations by which they will determine if they
are required to notify their interest in, or a change to their interest in,
the share capital of the Company under the Financial Conduct Authority's
Disclosure Guidance and Transparency Rules.

 

 

3.            Director's Participation and Related Party
Transactions

 

As at the date of this Announcement, Trevor Brown holds 35,421,915 Ordinary
Shares representing 25.70 per cent. of the Company's issued share capital.
Trevor Brown has agreed to subscribe for 3,550,000 Subscription Shares
pursuant to the Subscription at the Placing Price. Following Admission, Trevor
Brown will have an interest in 45,571,915 Ordinary Shares representing 25.41
per cent. of the Enlarged Share Capital.

 

The subscription by Trevor Brown, as a substantial shareholder (as defined in
the AIM Rules for Companies) and director, constitutes a related party
transaction pursuant to AIM Rule 13. The Directors (other than Trevor Brown),
having consulted with Cavendish, the Company's nominated adviser, believe that
the participation in the Fundraising by Trevor Brown is fair and reasonable
insofar as Shareholders are concerned.

 

As part of the Placing, First Equity Limited ("First Equity"), an existing
Shareholder, has agreed to subscribe for 11,000,000 Placing Shares pursuant to
the Placing at the Placing Price. Following Admission, First Equity will have
an interest in 29,000,000 Ordinary Shares, representing approximately 16.17
per cent. of the Enlarged Share Capital.  The participation in the Placing by
First Equity (as a substantial shareholder) constitutes a related party
transaction pursuant to the AIM Rules. The Directors (other than Trevor
Brown), having consulted with Cavendish, the Company's nominated adviser,
believe that the participation in the Fundraising by First Equity is fair and
reasonable insofar as Shareholders are concerned.

 

NOTIFICATION AND PUBLIC DISCLOSURE OF TRANSACTIONS BY PERSONS DISCHARGING
MANAGERIAL RESPONSIBILITIES AND PERSONS CLOSELY ASSOCIATED WITH THEM

 1   Details of the person discharging managerial responsibilities / person closely
     associated

 a)  Name                                                         Trevor Brown

 2   Reason for the notification

 a)  Position/status                                              Executive Director

 b)  Initial notification/Amendment                               Initial Notification

 3   Details of the issuer, emission allowance market participant, auction
     platform, auctioneer or auction monitor
 a)  Name                                                         Chamberlin plc

 b)  LEI                                                          213800OS2SK73PPFO761

 4   Details of the transaction(s): section to be repeated for (i) each type of
     instrument; (ii) each type of transaction; (iii) each date; and (iv) each
     place where transactions have been conducted

 a)  Description of the financial instrument, type of instrument  Ordinary Shares of 0.1p each
     Identification code                                          GB0001870228

 b)  Nature of the transaction                                    Purchase of Ordinary Shares pursuant to the Subscription

 c)  Price(s) and volumes(s)                                      Price(s)                       Volume(s)

     £0.02                                                                                       3,550,000

 d)  Aggregated information                                       N/A (single transaction)

     Aggregated volume                                            N/A (single transaction)

     Price                                                        N/A (single transaction)

 e)  Date of the transaction                                      9 January 2024

 f)  Place of the transaction                                     Outside of a trading venue

 

IMPORTANT NOTICES

 

Neither this Announcement, nor any copy of it, may be taken or transmitted,
published or distributed, directly or indirectly, in whole or in part, in or
into the United States, Australia, Canada, Japan, New Zealand or the Republic
of South Africa or to any persons in any of those jurisdictions or any other
jurisdiction where to do so would constitute a violation of the relevant
securities laws of such jurisdiction (each, a "Restricted Jurisdiction"). This
Announcement is for information purposes only and neither it, nor the
information contained in it, shall constitute an offer to sell or issue, or
the solicitation of an offer to buy, acquire or subscribe for any shares in
the capital of the Company in the United States, Australia, Canada, Japan, New
Zealand or the Republic of South Africa or any other state or jurisdiction in
which such offer or solicitation is not authorised or to any person to whom it
is unlawful to make such offer or solicitation.  Any failure to comply with
these restrictions may constitute a violation of securities laws of such
jurisdictions.

The Placing Shares 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 or under any securities laws of any state or
other jurisdiction of the United States and may not be offered, sold, resold,
pledged, transferred or delivered, directly or indirectly, in or into the
United States except pursuant to an applicable exemption from, or in a
transaction not subject to, the registration requirements of the Securities
Act and in compliance with the securities laws of any state or other
jurisdiction of the United States.

No action has been taken by the Company, the Joint Bookrunners or any of their
respective directors, officers, partners, agents, employees, affiliates,
advisors, consultants or, in the case of each of the Joint Bookrunners,
persons connected with them as defined in the Financial Services and Markets
Act 2000, as amended ("FSMA") (together, "Affiliates") that would permit an
offer of the Placing Shares or possession or distribution of this Announcement
or any other publicity material relating to such Placing Shares in any
jurisdiction where action for that purpose is required. Persons receiving this
Announcement are required to inform themselves about and to observe any
restrictions contained in this Announcement.

Persons (including, without limitation, nominees and trustees) who have a
contractual or other legal obligation to forward a copy of this Announcement
should seek appropriate advice before taking any action.

This Announcement has not been approved by the Financial Conduct Authority or
the London Stock Exchange.

No offering document or prospectus will be made available in connection with
the matters contained or referred to in this Announcement and no such offering
document or prospectus is required to be published, in accordance with
Regulation (EU) 2017/1129 (the "Prospectus Regulation") or Regulation (EU)
2017/1129, as amended and retained in UK law on 31 December 2020 by the
European Union (Withdrawal) Act 2018 (the "EUWA") (the "UK Prospectus
Regulation").

This Announcement is not being distributed by, nor has it been approved for
the purposes of section 21 of FSMA by, a person authorised under FSMA. This
Announcement is being distributed and communicated to persons in the United
Kingdom only in circumstances in which section 21(1) of FSMA does not require
approval of the communication by an authorised person.

This Announcement has been issued by, and is the sole responsibility of, the
Company. No responsibility or liability is or will be accepted by, and no
undertaking, representation or warranty or other assurance, express or
implied, is or will be made or given by the Joint Bookrunners, or by any of
their respective Affiliates as to, or in relation to, the accuracy, fairness
or completeness of the information or opinions contained in this Announcement
or any other written or oral information made available to or publicly
available to any interested person or its advisers, and any liability
therefore is expressly disclaimed. The information in this Announcement is
subject to change.

None of the information in this Announcement has been independently verified
or approved by the Joint Bookrunners or any of their respective Affiliates.
Save for any responsibilities or liabilities, if any, imposed on the Joint
Bookrunners by FSMA or by the regulatory regime established under it, no
responsibility or liability whatsoever whether arising in tort, contract or
otherwise, is accepted by the Joint Bookrunners or any of their Affiliates
whatsoever for the contents of the information contained in this Announcement
(including, but not limited to, any errors, omissions or inaccuracies in the
information or any opinions) or for any other statement made or purported to
be made by or on behalf of either of the Joint Bookrunners or any of their
respective Affiliates in connection with the Company, the Placing Shares or
the Placing or for any loss, cost or damage suffered or incurred howsoever
arising, directly or indirectly, from any use of this Announcement or its
contents or otherwise in connection with this Announcement or from any acts or
omissions of the Company in relation to the Placing. The Joint Bookrunners and
their respective Affiliates accordingly disclaim all and any responsibility
and liability whatsoever, whether arising in tort, contract or otherwise (save
as referred to above) in respect of any statements or other information
contained in this Announcement and no representation or warranty, express or
implied, is made by either of the Joint Bookrunners or any of their respective
Affiliates as to the accuracy, completeness or sufficiency of the information
contained in this Announcement.

Cavendish, which is authorised and regulated in the United Kingdom by the FCA,
is acting solely for the Company and no-one else in connection with the
Placing and arrangements described in this Announcement and will not regard
any other person (whether or not a recipient of this Announcement) as a client
in relation to the Placing or the transactions and arrangements described in
this Announcement. Cavendish is not responsible to anyone other than the
Company for providing the protections afforded to clients of Cavendish or for
providing advice in connection with the contents of this Announcement, the
Placing or the transactions and arrangements described herein.

Peterhouse, which is authorised and regulated in the United Kingdom by the
FCA, is acting solely for the Company and no-one else in connection with the
Placing and arrangements described in this Announcement and will not regard
any other person (whether or not a recipient of this Announcement) as a client
in relation to the Placing or the transactions and arrangements described in
this Announcement. Peterhouse is not responsible to anyone other than the
Company for providing the protections afforded to clients of Peterhouse or for
providing advice in connection with the contents of this Announcement, the
Placing or the transactions and arrangements described herein.

Certain statements in this Announcement are forward-looking statements, which
include all statements other than statements of historical fact and which are
based on the Company's expectations, intentions and projections regarding its
future performance, anticipated events or trends and other matters that are
not historical facts. These forward-looking statements, which may use words
such as "aim", "anticipate", "believe", "could", "will", "may", "intend",
"estimate", "expect" and words of similar meaning, include all matters that
are not historical facts. These forward-looking statements involve risks,
assumptions and uncertainties that could cause the actual results of
operations, financial condition, liquidity and dividend policy and the
development of the industries in which the Company's businesses operate to
differ materially from the impression created by the forward-looking
statements. These statements are not guarantees of future performance and are
subject to known and unknown risks, uncertainties and other factors that could
cause actual results to differ materially from those expressed or implied by
such forward-looking statements. Given those risks and uncertainties,
prospective investors are cautioned not to place undue reliance on
forward-looking statements. Forward-looking statements speak only as of the
date of such statements and, except as required by the FCA, the London Stock
Exchange or applicable law, the Company, the Joint Bookrunners and their
respective Affiliates undertakes no obligation to update or revise publicly
any forward-looking statements, whether as a result of new information, future
events or otherwise.

No statement in this Announcement is intended to be a profit forecast or
estimate and no statement in this Announcement should be interpreted to mean
that earnings per share of the Company for the current or future financial
years would necessarily match or exceed the historical published earnings per
share of the Company.

This Announcement does not identify or suggest, or purport to identify or
suggest, the risks (direct or indirect) that may be associated with an
investment in the Placing Shares. Any investment decision to buy Placing
Shares in the Placing must be made solely on the basis of publicly available
information, which has not been independently verified by the Joint
Bookrunners. This Announcement is not intended to provide the basis for any
decision in respect of the Company or other evaluation of any securities of
the Company or any other entity and should not be considered as a
recommendation that any investor should subscribe for, purchase, otherwise
acquire, sell or otherwise dispose of any such securities. Recipients of this
Announcement who are considering acquiring Placing Shares pursuant to the
Placing are reminded that they should conduct their own investigation,
evaluation and analysis of the business, data and property described in this
Announcement.  Any indication in this Announcement of the price at which the
Ordinary Shares have been bought or sold in the past cannot be relied upon as
a guide to future performance. The price and value of securities can go down
as well as up.

The contents of this Announcement are not to be construed as legal, business,
financial or tax advice. Each shareholder or prospective investor should
consult with his or her or its own legal adviser, business adviser, financial
adviser or tax adviser for legal, financial, business or tax advice.

In connection with the Placing, the Joint Bookrunners and any of their
respective affiliates, acting as investors for their own account, may take up
a portion of the Placing Shares in the Placing as a principal position and in
that capacity may retain, purchase, sell, offer to sell for the own accounts
or otherwise deal for their own account in such Placing Shares and other
securities of the Company or related investments in connection with the
Placing or otherwise. Accordingly, references to Placing Shares being offered,
acquired, placed or otherwise dealt in should be read as including any issue
or offer to, or acquisition, placing or dealing by, the Joint Bookrunners and
any of their respective affiliates acting in such capacity. In addition, the
Joint Bookrunners and any of their respective affiliates may enter into
financing arrangements (including swaps, warrants or contracts for difference)
with investors in connection with which the Joint Bookrunners and any of their
respective affiliates may from time to time acquire, hold or dispose of
shares. Neither of the Joint Bookrunners intend to disclose the extent of any
such investment or transactions otherwise than in accordance with any legal or
regulatory obligations to do so.

The Placing Shares to be issued pursuant to the Placing will not be admitted
to trading on any stock exchange other than AIM.

Each prospective placee has been offered Placing Shares at the Placing Price
and the Placing Shares have been conditionally subscribed by such placees
pursuant to irrevocable placing letters issued by the Joint Bookrunners.

Neither the content of the Company's website (or any other website) nor the
content of any website accessible from hyperlinks on the Company's website (or
any other website) is incorporated into, or forms part of, this Announcement.

Persons (including without limitation, nominees and trustees) who have a
contractual right or other legal obligations to forward a copy of this
Announcement should seek appropriate advice before taking any action.

UK Product Governance Requirements

Solely for the purposes of the product governance requirements contained
within the FCA Handbook Product Intervention and Product Governance Sourcebook
(the "UK Product Governance Rules"), and disclaiming all and any liability,
whether arising in tort, contract or otherwise, which any 'manufacturer' (for
the purposes of the UK Product Governance Rules) may otherwise have with
respect thereto, the Placing Shares have been subject to a product approval
process, which has determined that the Placing Shares are: (i) compatible with
an end target market of (a) retail clients, as defined in COBS 3.4.1R of the
Conduct of Business Sourcebook in the FCA Handbook ("COBS") , (b) investors
who meet the criteria of professional clients as defined in COBS 3.5.1R of
COBS and (c) eligible counterparties as defined in COBS 3.6.1R of COBS; and
(ii) eligible for distribution through all distribution channels as are
permitted by the UK Product Governance Rules (the "UK Target Market
Assessment"). Notwithstanding the UK Target Market Assessment, distributors
should note that: the price of the Placing Shares may decline and investors
could lose all or part of their investment; the Placing Shares offer no
guaranteed income and no capital protection; and an investment in the Placing
Shares is compatible only with investors who do not need a guaranteed income
or capital protection, who (either alone or in conjunction with an appropriate
financial or other adviser) are capable of evaluating the merits and risks of
such an investment and who have sufficient resources to be able to bear any
losses that may result therefrom. The UK Target Market Assessment is without
prejudice to the requirements of any contractual, legal or regulatory selling
restrictions in relation to the Placing. Furthermore, it is noted that,
notwithstanding the UK Target Market Assessment, the Joint Bookrunners will
only procure investors who meet the criteria of professional clients and
eligible counterparties. For the avoidance of doubt, the UK Target Market
Assessment does not constitute: (a) an assessment of suitability or
appropriateness for the purposes of COBS; or (b) a recommendation to any
investor or group of investors to invest in, or purchase, or take any other
action whatsoever with respect to the Placing Shares. Each distributor is
responsible for undertaking its own target market assessment in respect of the
Placing Shares and determining appropriate distribution channels.

EU Product Governance Requirements

Solely for the purposes of the product governance requirements contained
within: (a) EU Directive 2014/65/EU on markets in financial instruments, as
amended ("MiFID II"); (b) Articles 9 and 10 of Commission Delegated Directive
(EU) 2017/593 supplementing MiFID II; and (c) local implementing measures
(together, the "MiFID II Product Governance Requirements"), and disclaiming
all and any liability, whether arising in tort, contract or otherwise, which
any 'manufacturer' (for the purposes of the MiFID II Product Governance
Requirements) may otherwise have with respect thereto, the Placing Shares have
been subject to a product approval process, which has determined that the
Placing Shares are: (i) compatible with an end target market of retail clients
and investors who meet the criteria of professional clients and eligible
counterparties, each as defined in MiFID II; and (ii) eligible for
distribution through all distribution channels as are permitted by MiFID II
(the "EU Target Market Assessment"). Notwithstanding the EU Target Market
Assessment, distributors should note that: the price of the Placing Shares may
decline and investors could lose all or part of their investment; the Placing
Shares offer no guaranteed income and no capital protection; and an investment
in the Placing Shares is compatible only with investors who do not need a
guaranteed income or capital protection, who (either alone or in conjunction
with an appropriate financial or other adviser) are capable of evaluating the
merits and risks of such an investment and who have sufficient resources to be
able to bear any losses that may result therefrom. The EU Target Market
Assessment is without prejudice to the requirements of any contractual, legal
or regulatory selling restrictions in relation to the placing. Furthermore, it
is noted that, notwithstanding the EU Target Market Assessment, the Joint
Bookrunners will only procure investors who meet the criteria of professional
clients and eligible counterparties.

For the avoidance of doubt, the EU Target Market Assessment does not
constitute: (a) an assessment of suitability or appropriateness for the
purposes of MiFID II; or (b) a recommendation to any investor or group of
investors to invest in, or purchase or take any other action whatsoever with
respect to the Placing Shares. Each distributor is responsible for undertaking
its own target market assessment in respect of the Placing Shares and
determining appropriate distribution channels.

 

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