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REG - City Developments Ld Millennium & Copthor - Rule 19.6(b) Update




 



RNS Number : 0552O
City Developments Limited
27 May 2020
 

FOR IMMEDIATE RELEASE

27 May 2020

AGAPIER INVESTMENTS LIMITED

RULE 19.6(B) UPDATE TO STATED POST-OFFER INTENTION STATEMENTS WITH REGARD TO MILLENNIUM & COPTHORNE HOTELS PLC (NOW MILLENNIUM & COPTHORNE HOTELS LIMITED)

Agapier Investments Limited ("Bidco"), a wholly-owned indirect subsidiary of City Developments Limited ("CDL"), announces that, further to its acquisition of Millennium & Copthorne Hotels plc (now (Millennium & Copthorne Hotels Limited) ("M&C"), it has taken certain courses of action that differ in respect to the statements of intent made pursuant to Rules 2.7(c)(iv) and 24.2 of The City Code on Takeovers and Mergers (the "Code") (the "Stated Intentions"), as set out in the announcement dated 7 June 2019 and the offer document dated 15 August 2019 (together, the "Offer Documentation").

This announcement is required under Rule 19.6(b) of the Code.

The Stated Intentions as at the date of the Offer Documentation, included that Bidco did not intend, amongst other things, to make material changes with regard to the continued employment of, or the conditions of employment of, M&C's employees and that the existing employment rights of the management and employees of M&C would be fully safeguarded in accordance with contractual and statutory requirements.

The prolonged COVID-19 pandemic and governmental restriction measures introduced across most jurisdictions have severely affected the market and, in particular, the global hospitality sector with travel restrictions, trip cancellations, postponement of major events and a steep reduction in food & beverage spend.

To adhere to the requirements prescribed by the relevant governmental authorities where M&C's hotels are located, approximately 50% of M&C's global hotel portfolio (excluding hotels operated under the M&C franchise model) have been closed to customers and staff. Under such circumstances, M&C has taken and will continue to take certain steps to implement a series of business optimisation and cost control initiatives to minimise operating expenses. One of these steps has been to furlough approximately 30% of M&C's employees, as they are currently unable to perform their functions as a result of the governmental requirements and hotel closures. The current terms of such furlough arrangements are in accordance with the relevant guidelines issued by local governments. Subject to any further restrictions that may be imposed or extended by the local governments, M&C intends to end the furlough arrangements when appropriate and for employees to have the opportunity to return to their roles within M&C at that time. Unfortunately, in addition to these furlough arrangements, it has also been necessary to reduce M&C's global headcount by approximately 8%. Each affected employee has received payments in accordance with contractual and/or statutory requirements. Additionally, effective from 1 April 2020, senior management and executives in M&C have accepted a salary reduction of up to 30% depending on the seniority of such employees.

The M&C head office has been temporarily closed in line with the requirements of the UK government, with those employees not subject to furlough working remotely.

The contractual rights of M&C employees will otherwise continue to be honoured.

 

Enquiries:

CDL and Bidco

 

Belinda Lee, Head, Investor Relations & Corporate Communications

+65 68778315
belindalee@cdl.com.sg



FURTHER INFORMATION

The percentages contained in this announcement: (i) are based on information as at 30 April 2020; and (ii) exclude hotels operated under the M&C franchise model.

 


This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact rns@lseg.com or visit www.rns.com.
 
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