REG - Titan Investment - Invitation To Treat

DanaAnnouncement

29/04/2021 08:05

RNS Number : 0066X
  
Titan Investment Atlas Limited
  
29 April 2021
  
 

TITAN INVITATION TO TREAT FOR HELIOS CLASS E CMBS
 
NOT FOR DISTRIBUTION IN OR INTO OR TO ANY PERSON LOCATED OR RESIDENT IN THE UNITED STATES, ITS TERRITORIES AND POSSESSIONS (INCLUDING PUERTO RICO, THE U.S. VIRGIN ISLANDS, GUAM, AMERICAN SAMOA, WAKE ISLAND AND THE NORTHERN MARIANA ISLANDS, ANY STATE OF THE UNITED STATES AND THE DISTRICT OF COLUMBIA) OR TO ANY U.S. PERSON (AS DEFINED IN REGULATION S OF THE UNITED STATES NOTES ACT OF 1933, AS AMENDED) OR IN ANY JURISDICTION WHERE IT IS UNLAWFUL TO RELEASE, PUBLISH OR DISTRIBUTE THIS ANNOUNCEMENT.
 
THIS ANNOUNCEMENT CONTAINS IMPORTANT INFORMATION OF INTEREST TO THE BENEFICIAL OWNERS OF THE NOTES REFERRED TO HEREIN. IF APPLICABLE, ALL DEPOSITARIES, CUSTODIANS AND OTHER INTERMEDIARIES RECEIVING THIS ANNOUNCEMENT ARE REQUESTED TO PASS THIS ANNOUNCEMENT TO SUCH BENEFICIAL OWNERS IN A TIMELY MANNER.
 
If you are in any doubt as to the action you should take, you are recommended to seek your own financial and legal advice immediately from your stockbroker, bank manager, solicitor, accountant or other financial adviser authorised under the Financial Services and Markets Act 2000 (if you are in the United Kingdom), or from another appropriately authorised independent financial or legal adviser.
If you have recently sold or otherwise transferred your entire holding(s) of any of the Class E Notes referred to below, you should immediately forward this announcement to the purchaser or transferee or to the stockbroker, bank or other agent through whom the sale or transfer was effected for transmission to the purchaser or transferee.
29th April 2021
 
TITAN INVESTMENT ATLAS LIMITED ANNOUNCES AN INVITATION TO TREAT TO HOLDERS OF CLASS E NOTES ISSUED UNDER THE HELIOS SECURITISATION
 
Titan Investment Atlas Limited (the "Company") invites the holders of Class E Commercial Mortgage Backed Floating Rate Note due 2030 (ISIN: XS2078539173) (the "Class E Notes" and the holders of the Class E Notes being the "Class E Noteholders") issued by Helios (European Loan Conduit No.37) DAC (the "Issuer") and which are described in the offering circular which the Issuer published on 17 December 2019 (the "Offering Circular") to submit offers for the Company to purchase, via the Preferred Dealer (as defined below) or any of its affiliates, their Class E Notes (the offers being hereinafter referred to as the "Offers" and each an "Offer") for cash (the invitation being hereinafter referred to as the "Invitation to Treat") subject to the applicable distribution conditions and the terms contained within the remainder of this announcement. Capitalised terms used and not otherwise defined in this announcement have the respective meanings given to them in the Offering Circular.



Key Dates




Commencement Date


29th April 2021




Offer Deadline


15:00 (London time) on 6th May 2021




Offer Notification Deadline


13th May 2021




Settlement Date


17th May 2021



 
THE OFFER DEADLINE AND THE OFFER NOTIFICATION DEADLINE MAY BE AMENDED, EXTENDED, REOPENED, WITHDRAWN OR TERMINATED AT THE SOLE AND ABSOLUTE DISCRETION OF THE COMPANY.
Rationale for the Invitation to Treat
 
The Class E Notes are underpinned by a portfolio of well-maintained and managed select service hotel properties located across Great Britain. The Properties were trading satisfactorily and in line with expectations before the impact of Covid-19 and consequent government lockdowns from March 2020 drastically curtailed management's ability to trade the Properties at budgeted levels.
Despite the significant constraints on people's ability to travel, through the agile response of Atlas management, the business was able to continue to meet all obligations and finance its operations between 1 March 2020 and 31 March 2021.  In the quarter ended 31 March 2021 the shareholder provided an additional £3.6M of financing to ensure Atlas could fully service its CMBS debt.
Alongside the significant over-performance of the Portfolio against competition in the extraordinary circumstances arising from the world's first pandemic in over a century, Titan Investment Limited (the "Sponsor") and Atlas management have also been addressing the concerns raised by the Servicer and Special Servicer in connection with the Notes.
Actions taken by Servicer to date include the recently-commissioned independent valuation, dated 5 January 2021, which indicated a value of the Properties of £472m (taking the aggregate of individual asset-by-asset hotel values and disregarding the benefit of the Portfolio valuation of £504m). This independent valuation exceeds the last £ value of the Helios CMBS by over £120 million on an asset-by-asset basis and by over £150 million on a portfolio basis
Titan Acquisition Limited (the "Borrower") is in dialogue with the Special Servicer to post reserves to protect the interests of the Noteholders, although the Borrower believes that the extent of reserves proposed by the Special Servicer to date do not constitute an efficient use of capital in these unprecedented times, nor may they address the likely particular concerns of the most junior Notes, the Class E Notes, which the Borrower understands currently comprise the Controlling Class of Noteholders.
The Sponsor and the Borrower believe that the business will recover robustly once government lockdowns and operating constraints have been eased. We expect that this will happen for the UK select service market at a faster pace than the general economy or broader hospitality industry, and thus the Sponsor and the Borrower believe, with the facts available to them today, that the Properties adequately provide for full recovery and servicing of the Notes until they need to be redeemed.
Accordingly, and in parallel with continuing constructive dialogue between the Borrower and the Special Servicer, the Company wishes to address the concerns of Class E Noteholders by providing the opportunity for Class E Noteholders to offer to sell their Class E Notes to the Company.
Further details of the Invitation to Treat and Offers
Each Offer should record the number of Class E Notes which are being offered for sale and the proposed purchase price for those Class E Notes (the "Purchase Price"). The Purchase Price should include an amount equal to interest accrued and unpaid on the Class E Notes from (and including) the interest Payment Date immediately preceding the Settlement Date (as specified in the table headed "Key Dates" above) to (but excluding) the Settlement Date, determined in accordance with the terms and conditions for the issuance of the Class E Notes.
There can be no assurance that upon redemption of the Class E Notes in accordance with the terms and conditions for the issuance of the Class E Notes or otherwise, or upon acceleration of any such Class E Notes and enforcement of the applicable security relating thereto, that the relevant Class E Noteholders will recover from the Issuer an amount which is more than the Purchase Price.
Instructions
To make an Offer, the relevant Class E Noteholder should deliver, or arrange to have delivered on its behalf, via the Clearing Systems and in accordance with the requirements of the Clearing Systems, the Offer which must be received by the Preferred Dealer (as defined below) by no later than the Offer Deadline, unless extended, re-opened, amended and/or terminated by the Company (in its absolute discretion).
Once an Offer has been made, it cannot be revoked.
When considering whether to make an Offer, Class E Noteholders should take into account that restrictions on the transfer of Class E Notes will apply from the time of the Offer. A Class E Noteholder, on making an Offer, agrees that the relevant Class E Notes will be blocked in the relevant account at the relevant Clearing System from the date of the Offer until the earlier of (a) the date on which the Offer is declined by the Company; and (b) the time of settlement on the Settlement Date.
The Company is not under any obligation to accept for purchase any Class E Notes which are subject to an Offer. An Offer may be rejected in the sole and absolute discretion of the Company for any reason and the Company is not under any obligation to the Class E Noteholders to furnish any reason or justification for refusing to accept an Offer. For example, an Offer may be rejected if it does not comply with the relevant requirements of a particular jurisdiction or for any other reason.
Offer Notifications
The Preferred Dealer (as defined below) or an affiliate will contact each Class E Noteholder which has made an Offer by no later than the Offer Deadline (as specified in the table headed "Key Dates" above) to confirm whether or not that Class E Noteholder's Offer has been accepted, by no later than the Offer Notification Deadline.
The acceptance by the Company of an Offer is not conditional upon the acceptance by it of any other Offer.
Preferred Dealer
Citigroup Global Markets Limited is the Company's preferred dealer for the Offers and any subsequent purchase of Class E Notes (the "Preferred Dealer").
The Preferred Dealer is authorised and regulated by the Financial Conduct Authority in the United Kingdom. Neither the Preferred Dealer nor any of its affiliates 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 the Preferred Dealer in connection with this announcement, the Invitation to Treat, the Offers or otherwise.
Any questions or requests for assistance in connection with the Invitation to Treat, an Offer and/or the delivery of Instructions should be directed to both the Company and the Preferred Dealer, the contact details for whom are provided below.




 



Company


Preferred Dealer




+44 (0)203 727 3921
 
mezra@hbtitan.com
 


+44 20 7500 0888
 
Nicholas.wasilewski@citi.com



 
General information
No assurance can be given that any Offer will be accepted or that any sale or purchase will be completed. In addition, subject to applicable law, the Company may, in its sole and absolute discretion, extend, re-open, withdraw or terminate the Invitation to Treat and amend or waive any of the terms and conditions of the Invitation to Treat at any time and may, in its sole and absolute discretion, waive any of the conditions in respect of the Invitation to Treat.
Class E Noteholders are advised to check with any securities broker, dealer, bank, custodian, trust company or other intermediary through which they hold Class E Notes when such intermediary would require to receive instructions from a Class E Noteholder in order for that Class E Noteholder to be able to provide an Offer by the Offer Deadline. The deadlines set by any such intermediary and each Clearing System for the submission of Offers will be earlier than the relevant deadlines specified above.
Unless stated otherwise, announcements in connection with any Offer will be made by the delivery of notices to the Clearing Systems for communication to direct participants.  Such announcements may also be made by the issue of a press release to a Notifying News Service or in such other manner as the Company may decide. Significant delays may be experienced where notices are delivered to the Clearing Systems and Class E Noteholders are urged to contact both the Company and the Preferred Dealer for the relevant announcements relating to the Invitation to Treat.
Neither the Company nor the Preferred Dealer (including its affiliates) (each a "Disclaiming Party") has independently verified any information published by or on behalf of the Issuer, and accepts no duty, responsibility or liability for whether or not the information made publicly available by or on behalf of the Issuer is sufficient to enable Class E Noteholders to make an informed assessment of the financial condition of the Issuer or the price or value of the Class E Notes. No Disclaiming Party is responsible or liable for any failure by the Issuer (nor is such Disclaiming Party under any duty) to disclose any information about the Issuer's operations, financial condition and/or the performance of the relevant portfolio of underlying assets, even if such information may be material to an evaluation of the Issuer and the Class E Notes.  Class E Noteholders must make their own independent analysis of all facts and circumstances relevant to the Issuer and the Class E Notes, and whether or not to make an Offer.
This announcement is made by Titan Investment Atlas Limited and contains inside information for the purposes of Article 7 of the Market Abuse Regulation (EU) 596/2014 ("MAR"). For the purposes of MAR and Article 2 of the Commission Implementing Regulation (EU) 2016/1055, this announcement is made by Michael Ezra as a director of Titan Investment Atlas Limited.
 
Disclaimer
This announcement contains important information which should be read carefully before any decision is made to make an Offer. If any holder of the Class E Notes is in any doubt as to the action it should take or is unsure of the impact of the Invitation to Treat, it is recommended to seek its own financial and legal advice, including as to any tax consequences, from its stockbroker, bank manager, solicitor, accountant or other independent financial or legal adviser. Any individual or company whose Class E Notes are held on its behalf by a broker, dealer, bank, custodian, trust company or other nominee or intermediary must contact such entity if it wishes to make an offer for its Class E Notes.
The Issuer has not reviewed this announcement nor has it had any involvement in the terms of the Invitation to Treat. The Issuer does not accept any responsibility for any information contained in this announcement.
No Disclaiming Party nor any of its directors, employees or affiliates makes any recommendation as to whether holders of Class E Notes should make an Offer.
This announcement is not made by the Preferred Dealer. The Preferred Dealer expresses no opinion as to the merits of the Invitation to Treat, any Offers, the contents of this announcement or otherwise. The Preferred Dealer makes no representation or warranty that all relevant information has been disclosed to Noteholders in this announcement. No duty, responsibility or liability is or will be accepted by the Preferred Dealer in relation to the accuracy or completeness of this announcement or any other written or oral information made available to any person receiving this announcement or its advisers and any such duty, responsibility or liability is expressly disclaimed.
Distribution Restrictions
This announcement does not constitute an invitation to treat in any jurisdiction in which, or to any person to or from whom, it is unlawful to make such invitation or for there to be such participation under applicable securities laws. The distribution of this announcement in certain jurisdictions may be restricted by law. Persons into whose possession this announcement comes are required by the Company and the Preferred Dealer to inform themselves about and to observe any such restrictions.
 
United States
The invitation to treat is not being made and will not be made, directly or indirectly, in or into, or by use of the mails of, or by any means or instrumentality of interstate or foreign commerce of, or of any facilities of a national securities exchange of, the United States or to any U.S. Person (as defined in Regulation S of the United States Securities Act of 1933, as amended (each a "U.S. Person")). This includes, but is not limited to, facsimile transmission, electronic mail, telex, telephone, the internet and other forms of electronic communication. Accordingly, copies of this announcement and any other documents or materials relating to any of the invitation to treat are not being, and must not be, directly or indirectly, mailed or otherwise transmitted, distributed or forwarded (including, without limitation, by custodians, nominees or trustees) in or into the United States or to a U.S. Person and Class E Notes cannot be offered for sale pursuant to the invitation to treat by any such use, means, instrumentality or facility or from or within or by persons located or resident in the United States or by any U.S. Person. Any purported Offer resulting directly or indirectly from a violation of these restrictions will be invalid and any purported Offer made by a person located in the United States, a U.S. Person, by any person acting for the account or benefit of a U.S. Person, or by any agent, fiduciary or other intermediary acting on a non-discretionary basis for a principal giving instructions from within the United States will be invalid and will not be accepted.
Each Class E Noteholder which makes an Offer represents that it is not a U.S. Person, it is not located in the United States and is not making the Offer from the United States, or it is acting on a non-discretionary basis for a principal located outside the United States that is not giving an order to make the Offer from the United States and who is not a U.S. Person. For the purposes of this and the above paragraph, "United States" means the United States of America, its territories and possessions (including Puerto Rico, the U.S. Virgin Islands, Guam, American Samoa, Wake Island and the Northern Mariana Islands), any state of the United States of America and the District of Columbia.
 
United Kingdom
The communication of this announcement and any other documents or materials relating to the Invitation to Treat is not being made, and such documents and/or materials have not been approved, by an authorised person for the purposes of section 21 of the Financial Services and Markets Act 2000, as amended. Accordingly, such documents and/or materials are not being distributed to, and must not be passed on to, the general public in the United Kingdom. This announcement and any other documents or materials relating to the invitation to treat may not be distributed or circulated to any person in the United Kingdom other than (i) persons who have professional experience in matters relating to investments falling within Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005, as amended (the "Financial Promotion Order"), (ii) high net worth entities falling within Article 49(2)(A) to (D) of the Financial Promotion Order or (iii) any other persons to whom such distribution or circulation may otherwise lawfully be made under the Financial Promotion Order (all such persons together being referred to as "Relevant Persons"). This announcement and any other documents or materials relating to the invitation to treat are directed only at Relevant Persons and the invitation to treat is available only to Relevant Persons. Any person who is not a Relevant Person should not act or rely on this announcement or any of their respective contents.
 
Ireland
The communication of this announcement and any other documents or materials relating to the  Invitation to Treat are not being made, directly or indirectly, to the public in Ireland and no offers or sale of any notes or securities under or in connection with such Invitation to Treat may be effected to persons in Ireland except in conformity with the provisions of all applicable Irish laws and regulations (together, the "Applicable Irish Laws") including (i) the Companies Act 2014 (as amended) (the "Companies Act"); (ii) the Irish Central Bank Acts 1942 to 2018 (as amended) and any codes of practice made under Section 117(1) of the Central Bank Act 1989; (iii) Regulation (EU) 2017/1129, the European Union (Prospectus) Regulations 2019 and any rules issued under Section 1363 of the Companies Act by the Central Bank of Ireland (the "Central Bank"); (iv) the European Union (Markets in Financial Instruments) Regulations 2017 (as amended) and any codes or rules of conduct applicable thereunder and the provisions of the Investor Compensation Act 1998 (as amended); and (v) the Market Abuse Regulations (EU 596/2014) (as amended), the European Union (Market Abuse) Regulations 2016 (as amended and any rules and guidelines issued under Section 1370 of the Companies Act 2014 (as amended) by the Central Bank.
The Invitation to Treat and any other documents or materials relating to the Invitation to Treat must not be distributed to persons in Ireland otherwise than in conformity with the provisions of all Applicable Irish Laws.
 
General
None of this announcement or the electronic transmission thereof constitutes an invitation to treat or the solicitation for Offers (and Offers will not be accepted from Class E Noteholders) in any circumstances in which such invitation to treat or solicitation is unlawful.
In addition to the representations referred to above in respect of the United States, each Class E Noteholder which makes an Offer will be deemed to give certain other representations in respect of the other jurisdictions referred to above. Any Offer from a Class E Noteholder that is unable to make these representations will not be accepted.
Each of the Company and the Preferred Dealer reserves the right, in its sole and absolute discretion, to investigate, in relation to any Offer, whether any such representation given by a Class E Noteholder is correct and, if such investigation is undertaken and as a result the Company or the Preferred Dealer determines (for any reason) that such representation is not correct, such Offer may be rejected.

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