REG - Crest Nicholson Hdgs - Statement re revised proposal and PUSU extension

Crest Nicholson HoldingsAnnouncement

10/07/2024 09:00

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RNS Number : 8517V  Crest Nicholson Holdings PLC  10 July 2024

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 THAT JURISDICTION.

THIS IS AN ANNOUNCEMENT FALLING UNDER RULE 2.4 OF THE CITY CODE ON TAKEOVERS
AND MERGERS (THE "CODE") AND DOES NOT CONSTITUTE A FIRM INTENTION TO MAKE AN
OFFER UNDER RULE 2.7 OF THE CODE. THERE CAN BE NO CERTAINTY THAT ANY FIRM
OFFER WILL BE MADE.

THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION.

For immediate
release
 

10 July 2024

 

Statement regarding revised proposal from Bellway p.l.c. for Crest Nicholson
Holdings plc and extension to PUSU deadline

 

On 13 June 2024, Bellway p.l.c. ("Bellway") announced the terms of a possible
all-share offer for Crest Nicholson Holdings plc ("Crest Nicholson"). The
announcement stated that, in accordance with Rule 2.6(a) of the Code, Bellway
was required, by no later than 5.00 p.m. (London time) on 11 July 2024, to
either announce a firm intention to make an offer for Crest Nicholson in
accordance with Rule 2.7 of the Code or announce that it does not intend to
make an offer, in which case the announcement will be treated as a statement
to which Rule 2.8 of the Code applies (the "PUSU Deadline").

On 14 June 2024, Crest Nicholson confirmed it had received two unsolicited
preliminary proposals from Bellway in relation to a possible all-share offer
for Crest Nicholson, both of which had been unanimously rejected by the Board
of Crest Nicholson.

Following further discussions between Bellway and Crest Nicholson, on 3 July
2024 Bellway submitted its latest non-binding all-share offer to the Board of
Crest Nicholson to acquire the entire issued, and to be issued, share capital
of Crest Nicholson. Under the terms of this latest possible offer, Crest
Nicholson's shareholders would receive:

0.099 shares in Bellway for each share they own in Crest Nicholson

and

a dividend of 4 pence per Crest Nicholson share comprising the previously
announced interim dividend of 1 pence per share (the "Interim Dividend") and a
special dividend of 3 pence per share conditional on completion of the
transaction (the "Special Dividend") (together, the "Revised Proposal").

Based on the undisturbed Bellway share price of 2,718 pence at close of
business on 13 June 2024 (being the latest practicable date prior to the
commencement of the offer period), the terms of the Revised Proposal represent
an implied value of 273 pence per Crest Nicholson share and:

·      a premium of approximately 28.3 per cent. to the closing price
per Crest Nicholson share on 13 June 2024 (being the latest practicable date
prior to the commencement of the offer period);

·      a premium of approximately 30.2 per cent. to the 3-month VWAP per
Crest Nicholson share on 13 June 2024 (being the latest practicable date prior
to the commencement of the offer period); and

·      a premium of approximately 36.3 per cent. to the 12-month VWAP
per Crest Nicholson share on 13 June 2024 (being the latest practicable date
prior to the commencement of the offer period).

Under the terms of the Revised Proposal, Crest Nicholson's shareholders would
hold 18 per cent. of the enlarged group's issued and to be issued share
capital.

The Revised Proposal is subject to a number of pre-conditions, including
completion of satisfactory due diligence.

The Board of Crest Nicholson has confirmed to Bellway that the Revised
Proposal is at a value that it would be minded to recommend unanimously to
Crest Nicholson's shareholders, should a firm intention to make an offer
pursuant to Rule 2.7 of the Code be announced on the financial terms set out
above and subject to agreement on other key terms and definitive transaction
documentation.

The Boards of Bellway and Crest Nicholson believe that there is compelling
strategic and financial rationale for a combination of Bellway and Crest
Nicholson. The Revised Proposal would bring together the strength of each
business with complementary brands to reinforce Bellway's position as a
leading UK housebuilder, while enabling Crest Nicholson shareholders to
benefit from the scale of the combined business. In addition, the Board of
Bellway believes a combination would deliver significant operational benefits
(including procurement synergies) and the ability to open dual outlets on at
least 10 current and future Crest Nicholson sites with complementary brands to
drive incremental volumes at attractive margins. As part of the combination
the Board of Bellway intends to retain and deploy the Crest Nicholson brand
across the enlarged group (including on Bellway sites).

In order to enable satisfactory due diligence to take place, Bellway has
requested, and the Board of Crest Nicholson and the Panel on Takeovers and
Mergers (the "Takeover Panel") have consented to, an extension to the PUSU
Deadline.

Consequently, in accordance with Rule 2.6(c) of the Code, Bellway is required,
by no later than 5.00 p.m. on 8 August 2024 either to announce a firm
intention to make an offer for Crest Nicholson under Rule 2.7 of the Code or
to announce that it does not intend to make an offer for Crest Nicholson, in
which case the announcement will be treated as a statement to which Rule 2.8
of the Code applies.  This deadline may only be extended with the agreement
of Crest Nicholson and the Panel in accordance with Rule 2.6(c) of the Code.

There can be no certainty that a firm offer will ultimately be made for Crest
Nicholson by Bellway, even if the pre-conditions are satisfied or waived.
Bellway reserves the right to waive any pre-condition to the making of an
offer. A further announcement will be made as and when appropriate.

In accordance with Rule 2.5(a) of the Code, Bellway reserves the right to
introduce other forms of consideration and/or vary the mix or composition of
consideration of any offer. In addition, Bellway reserves the right to make an
offer for Crest Nicholson at a lower value or on less favourable terms than
the Revised Proposal: (i) with the agreement or recommendation of the Board of
Crest Nicholson; (ii) if a third party announces a firm intention to make an
offer for Crest Nicholson, which, at that date, is of a value less than the
value of the Revised Proposal, and is recommended by the Board of Crest
Nicholson; or (iii) following the announcement by Crest Nicholson of a Rule 9
waiver transaction pursuant to Appendix 1 of the Code or a reverse takeover
(as defined in the Code). If Crest Nicholson declares, makes or pays any
dividend or distribution or other return of value or payment to its
shareholders, other than the Interim Dividend and Special Dividend, Bellway
reserves the right to make an equivalent reduction to the Revised Proposal.

This announcement has been made with the consent of Bellway and Crest
Nicholson.

The person responsible for arranging the release of this announcement on
behalf of Bellway is Simon Scougall, Group General Counsel and Company
Secretary and on behalf of Crest Nicholson is Penny Thomas, Group Company
Secretary.

Enquiries:

 

 Bellway p.l.c.                                                         via Powerscourt
 Simon Scougall, Group General Counsel and Company Secretary

 Citi                                                                   +44 (0) 20 7986 4000
 Joint financial adviser and joint corporate broker to Bellway
 Robert Redshaw
 Ram Anand
 Robert Johnson

 Irina Dzuteska

 Deutsche Numis                                                         +44 (0) 20 7260 1000
 Joint financial adviser and joint corporate broker to Bellway
 Heraclis Economides
 Derek Shakespeare
 Simon Hollingsworth

 Oliver Hardy

 Powerscourt                                                            +44 (0) 20 7250 1446

 Financial communications adviser to Bellway
 Justin Griffiths

 Victoria Heslop
 Crest Nicholson Holdings plc                                           +44 (0) 19 3258 0555
 Bill Floydd (Group Finance Director)

 Barclays Bank PLC, acting through its investment bank                  +44 (0) 20 7623 2323
 Joint financial adviser and joint corporate broker to Crest Nicholson
 Robert Mayhew
 Osman Akkaya
 Stuart Jempson
 Mark Gunalan
 Jefferies International Limited                                        +44 (0) 20 7029 8000
 Joint financial adviser and joint corporate broker to Crest Nicholson
 Philip Yates
 Sam Barnett
 Will Soutar
 Thomas Bective
 Teneo                                                                  +44 (0) 20 7260 2700

 Financial communications adviser to Crest Nicholson
 James Macey White

 Giles Kernick

Sources and bases

1.     The 18 per cent. ownership of Crest Nicholson's shareholders in the
enlarged group's issued share capital and the indicative offer value of 273
pence per share have been calculated based on the exchange ratio of 0.099
shares in Bellway for each Crest Nicholson share and a total dividend of 4
pence per Crest Nicholson share. The ownership in the combined group is based
on Crest Nicholson's number of ordinary shares of 256,920,539 and fully
diluted shares of 263,797,252 as well as Bellway's number of ordinary shares
of 118,978,859, both as of 9 July 2024. The offer value per share is
calculated by reference to the closing price of 2,718 pence per Bellway share
on 13 June 2024 (being the latest practicable date prior to the commencement
of the offer period).

2.     The one-day premia has been calculated by reference to a closing
price of 212.8 pence per Crest Nicholson share on 13 June 2024 (being the
latest practicable date prior to the commencement of the offer period).

3.     The 3-month volume-weighted average price of 209.7 pence has been
derived from Bloomberg and has been rounded to the nearest single decimal
place.

4.     The 12-month volume-weighted average price of 200.4 pence has been
derived from Bloomberg and has been rounded to the nearest single decimal
place.

5.     Certain figures included in this announcement have been subject to
rounding adjustments.

Further information

Citigroup Global Markets Limited ("Citi"), which is authorised by the PRA and
regulated in the UK by the FCA and the PRA, is acting exclusively for Bellway
and for no one else in connection with the matters described in this
Announcement and will not be responsible to anyone other than Bellway for
providing the protections afforded to clients of Citi nor for providing advice
in connection with the matters referred to in this Announcement. Neither Citi
nor any of its affiliates, directors or employees owes or accepts any duty,
liability or responsibility whatsoever (whether direct or indirect,
consequential, whether in contract, in tort, in delict, under statute or
otherwise) to any person who is not a client of Citi in connection with this
Announcement, any statement contained herein or otherwise.

Numis Securities Limited ("Deutsche Numis"), which is authorised and regulated
in the United Kingdom by the Financial Conduct Authority, is acting
exclusively for Bellway and no one else in connection with the matters set out
in this announcement and will not regard any other person as its client in
relation to the matters in this announcement and will not be responsible to
anyone other than Bellway for providing the protections afforded to clients of
Deutsche Numis, nor for providing advice in relation to any matter referred to
herein. Neither Deutsche Numis nor any of its affiliates (nor any of their
respective directors, officers, employees or agents), owes or accepts any
duty, liability or responsibility whatsoever (whether direct or indirect,
whether in contract, in tort, under statute or otherwise) to any person who is
not a client of Deutsche Numis in connection with this announcement, any
statement contained herein or otherwise.

Barclays Bank PLC, acting through its Investment Bank ("Barclays"), which is
authorised by the Prudential Regulation Authority and regulated in the United
Kingdom by the Financial Conduct Authority and the Prudential Regulation
Authority, is acting exclusively for Crest Nicholson and no one else in
connection with the subject matter of this announcement and will not be
responsible to anyone other than Crest Nicholson for providing the protections
afforded to clients of Barclays nor for providing advice in relation to the
subject matter of this announcement.

In accordance with the Code, normal United Kingdom market practice and Rule
14e-5(b) of the Exchange Act, Barclays and its affiliates will continue to act
as exempt principal trader in Crest Nicholson securities on the London Stock
Exchange. These purchases and activities by exempt principal traders which are
required to be made public in the United Kingdom pursuant to the Code will be
reported to a Regulatory Information Service and will be available on the
London Stock Exchange website at www.londonstockexchange.com. This information
will also be publicly disclosed in the United States to the extent that such
information is made public in the United Kingdom.

Jefferies International Limited ("Jefferies"), which is authorised and
regulated by the Financial Conduct Authority in the United Kingdom, is acting
exclusively for Crest Nicholson and no one else in connection with the matters
referred to in this announcement and will not regard any other person as its
client in relation to the matters in this announcement and will not be
responsible to anyone other than Crest Nicholson for providing the protections
afforded to clients of Jefferies nor for providing advice in relation to any
matter referred to in this announcement. Neither Jefferies nor any of its
affiliates (nor their respective directors, officers, employees or agents)
owes or accepts any duty, liability or responsibility whatsoever (whether
direct or indirect, whether in contract, in tort, under statute or otherwise)
to any person who is not a client of Jefferies in connection with this
announcement, any statement contained herein or otherwise.

This announcement is not intended to and does not constitute an offer to sell
or the solicitation of an offer to subscribe for or buy or an invitation to
purchase or subscribe for any securities or the solicitation of any vote in
any jurisdiction.

The release, publication or distribution of this announcement in jurisdictions
outside the United Kingdom may be restricted by law and therefore persons into
whose possession this announcement comes should inform themselves about, and
observe such restrictions. Any failure to comply with such restrictions may
constitute a violation of the securities law of any such jurisdiction.

Disclosure requirements of the Code

Under Rule 8.3(a) of the Code, any person who is interested in 1% or more of
any class of relevant securities of an offeree company or of any securities
exchange offeror (being any offeror other than an offeror in respect of which
it has been announced that its offer is, or is likely to be, solely in cash)
must make an Opening Position Disclosure following the commencement of the
offer period and, if later, following the announcement in which any securities
exchange offeror is first identified. An Opening Position Disclosure must
contain details of the person's interests and short positions in, and rights
to subscribe for, any relevant securities of each of (i) the offeree company
and (ii) any securities exchange offeror(s). An Opening Position Disclosure by
a person to whom Rule 8.3(a) applies must be made by no later than 3.30 pm
(London time) on the 10th business day following the commencement of the offer
period and, if appropriate, by no later than 3.30 pm (London time) on the 10th
business day following the announcement in which any securities exchange
offeror is first identified. Relevant persons who deal in the relevant
securities of the offeree company or of a securities exchange offeror prior to
the deadline for making an Opening Position Disclosure must instead make a
Dealing Disclosure.

Under Rule 8.3(b) of the Code, any person who is, or becomes, interested in 1%
or more of any class of relevant securities of the offeree company or of any
securities exchange offeror must make a Dealing Disclosure if the person deals
in any relevant securities of the offeree company or of any securities
exchange offeror. A Dealing Disclosure must contain details of the dealing
concerned and of the person's interests and short positions in, and rights to
subscribe for, any relevant securities of each of (i) the offeree company and
(ii) any securities exchange offeror(s), save to the extent that these details
have previously been disclosed under Rule 8. A Dealing Disclosure by a person
to whom Rule 8.3(b) applies must be made by no later than 3.30 pm (London
time) on the business day following the date of the relevant dealing.

If two or more persons act together pursuant to an agreement or understanding,
whether formal or informal, to acquire or control an interest in relevant
securities of an offeree company or a securities exchange offeror, they will
be deemed to be a single person for the purpose of Rule 8.3.

Opening Position Disclosures must also be made by the offeree company and by
any offeror and Dealing Disclosures must also be made by the offeree company,
by any offeror and by any persons acting in concert with any of them (see
Rules 8.1, 8.2 and 8.4).

Details of the offeree and offeror companies in respect of whose relevant
securities Opening Position Disclosures and Dealing Disclosures must be made
can be found in the Disclosure Table on the Panel's website at
www.thetakeoverpanel.org.uk, including details of the number of relevant
securities in issue, when the offer period commenced and when any offeror was
first identified. You should contact the Panel's Market Surveillance Unit on
+44 (0)20 7638 0129 if you are in any doubt as to whether you are required to
make an Opening Position Disclosure or a Dealing Disclosure.

Rule 2.9 information

In accordance with Rule 2.9 of the Code, Bellway confirms that, as at the
close of business on 9 July 2024 (being the business day immediately prior to
the date of this announcement), it had in issue 118,978,859 ordinary shares of
12.5 pence each. Bellway does not hold any ordinary shares in treasury. The
International Securities Identification Number (ISIN) of Bellway's ordinary
shares is GB0000904986.

In accordance with Rule 2.9 of the Code, Crest Nicholson confirms that, as at
the close of business on 9 July 2024, (being the business day immediately
prior to the date of this announcement) it has 256,920,539 ordinary shares of
5 pence each. No shares are held in treasury. The International Securities
Identification Number (ISIN) for the ordinary shares is GB00B8VZXT93.

Publication on website

In accordance with Rule 26.1 of the Code, a copy of this announcement will be
available at www.bellwayplc.co.uk/investor-centre and
www.crestnicholson.com/investors (http://www.crestnicholson.com/investors)
promptly and in any event by no later than 12 noon on the business day
following this announcement. The content of these websites is not incorporated
into and does not form part of this announcement.

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