REG - GVC Holdings PLC Ladbrokes Coral Grp - RECOMMENDED OFFER FOR LADBROKES CORAL GROUP PLC <Origin Href="QuoteRef">GVC.L</Origin> <Origin Href="QuoteRef">LCL.L</Origin> - Part 5
22/12/2017 07:11
- Part 5: For the preceding part double click ID:nRSV1831Ad
the voting) in favour of the GVC Resolutions to be proposed at the GVC
General Meeting in relation to the following GVC Shares, in which they or
their family members and connected persons are beneficially interested,
representing in aggregate approximately 1.1 per cent. of the existing issued
ordinary share capital of GVC at the Last Practicable Date:
Name Number of GVCShares Percentage of GVCShares in issue at the Last Practicable Date
Kenneth Alexander 1,898,788* 0.63
Lee Feldman 734,141 0.24
Norbert Teufelberger 755,276 0.25
Jane Anscombe 1,406 <0.01
* 313,333 of these shares are legally and beneficially owned by Caroline
Alexander
The irrevocable undertakings will cease to be binding: if:
(a) the Scheme does not become effective or, if GVC elects, subject to
GVC (with the consent of the Takeover Panel and as otherwise as permitted in
accordance with the co-operation agreement entered into with Ladbrokes Coral),
to implement the Acquisition by way of an Offer, the Offer does not become and
is not declared unconditional as to acceptances, in each case by 30 June 2018
or such later date as GVC and Ladbrokes Coral may agree in writing;
(b) the board of directors of GVC withdraws, adversely modifies or
qualifies its recommendation to the GVC shareholders to vote in favour of the
resolutions concerning the Acquisition;
(c) the Offer or Scheme lapses or is withdrawn and no new, revised or
replacement Scheme or Offer has been announced, in accordance with Rule 2.7 of
the Code, in its place or is announced, in accordance with Rule 2.7 of the
Code, at the same time; or
(d) the Offer becomes or is declared wholly unconditional or the Scheme
becomes effective.
APPENDIX IV
QUANTIFIED FINANCIAL BENEFITS STATEMENTS
The information in this Appendix IV has been compiled by GVC.
Part A
Paragraph 3 of this Announcement includes statements of estimated cost savings
and synergies arising from the Acquisition (together, the "Quantified
Financial Benefits Statement").
A copy of the Quantified Financial Benefits Statement is set out below:
"Following analysis undertaken by GVC and discussions with Ladbrokes Coral,
the Directors of GVC have identified significant opportunities for cost and
revenue synergies as a result of the Acquisition which are expected to create
shareholder value.
The Board of GVC believes that the Enlarged Group will be able to achieve
recurring annual pre-tax cost synergies of not less than £100 million. GVC
expects that these cost synergies are split between and would be realised
principally from:
(a) Technology and data enabled efficiencies, accounting for
approximately 44 per cent. of the identified cost synergies:
· consolidating the Enlarged Group's sportsbetting and gaming operations
and other business operations onto common platforms, where possible;
· deploying and promoting the Enlarged Group's own gaming content rather
than that of a third party, where possible; and
· using the increased bargaining power of the Enlarged Group to negotiate
better contracted rates with common suppliers for data content and streaming.
(b) Corporate and administrative efficiencies, accounting for
approximately 30 per cent. of the identified cost synergies:
· consolidating the trading and customer service teams to service all
brands across the Enlarged Group and consolidating technology costs to the GVC
technology platform;
· utilising technology and lower cost locations to drive greater staff
productivity; and
· moving common operational marketing and central functions to a central
service group.
(c) Marketing efficiencies, accounting for approximately 14 per cent.
of the identified cost synergies:
· applying Ladbrokes Coral's business intelligence to GVC brands to
achieve savings from reduced marketing and bonus spend.
(d) Other efficiencies, accounting for approximately 12 per cent. of
the identified cost synergies:
· consolidating some international businesses by combining platforms and
harmonising teams;
· reducing external costs including payment processing and professional
services fees; and
· reducing other expenditure such as office and travel costs.
The Board of GVC expects that synergy and saving realisation of £100 million
will take place progressively, whereby approximately £7 million of the total
cost synergies will be achieved in the first calendar year following
Completion, rising to approximately £33 million by year two and approximately
£56 million by year three following Completion. It is expected that a benefit
of £100 million of identified cost synergies will be achieved by 2021. The
synergies programme is expected to continue after 2021, but the scale of
further synergies have not been fully quantified, and so are not being
reported on for the purposes of the Takeover Code. The expected synergies will
accrue as a direct result of the Acquisition and would not be achieved on a
standalone basis.
Non-recurring restructuring costs of approximately £100 million are expected
to be incurred in delivering the identified cost synergies in the four years
post completion.The phasing of these costs will be £17 million in the
financial year ending 31 December 2018, £30 million in 2019, £31 million in
2020 and £22 million in 2021. No recurring restructuring costs have been
identified as a consequence of the Acquisition.
Other than these identified restructuring costs and the waiver by GVC of its
rights to earn-out consideration following the sale of its Turkish facing
business which was payable over a five-year period up to a maximum of E150m
(summarised in paragraph 8 below), the Board of GVC does not expect any
dis-synergies to arise as a result of the Acquisition."
Bases of belief
The assessment and quantification of the potential synergies from the
Acquisition have been informed by GVC and Ladbrokes management's industry
knowledge as well as their combined experience of executing and integrating
past acquisitions, including GVC's acquisition of Sportingbet and bwin.party
and Ladbrokes' merger with Coral.
The principal assumption for assessing the potential synergies is that the
Ladbrokes business activities will be supported by the GVC infrastructure as
much as practicable, and that business and central functions will be
consolidated where appropriate. This approach reflects the fact that both GVC
and Ladbrokes operate substantial online gaming businesses and there are
operational and cost advantages to consolidating activities on a single
platform where possible.
In order to prepare the Quantified Financial Benefits Statement of potential
synergies that are expected to be available, GVC took the following steps:
· GVC held several meetings with senior finance, commercial and strategy
personnel at Ladbrokes and both sides shared sufficient operating and
financial information to enable GVC to quantify initial estimates of potential
synergies and associated costs available from the Acquisition;
· In areas where data has been limited for commercial or other reasons,
GVC has made estimates and assumptions to aid its development of individual
synergy initiatives;
· The 2016 cost bases for GVC and Ladbrokes were added to establish a
pro-forma cost base as a base line for the synergies analysis (the "Initial
Cost Base"). The cost base for GVC used as the basis for the Quantified
Financial Benefits Statement is the pro-forma combined cost base for the 12
months ended 31 December 2016, giving effect to the acquisition of bwin.party
as if that acquisition had occurred on 1 January 2016. The cost base for
Ladbrokes used as the basis for the Quantified Financial Benefits Statement is
the pro-forma combined cost base for the 12 months ended 31 December 2016,
giving effect to the combination of Ladbrokes and Coral as if that combination
had occurred on 1 January 2016;
· Unless otherwise stated, the financial information relating to GVC is
extracted (without adjustment) from management accounts and audited
consolidated financial statements for GVC for the year ended 31 December 2016,
from the interim results statement of GVC for the six months ended 30 June
2017 or the 2017 latest estimate financial information (actual for January to
October 2017 and forecast for November - December 2017);
· Unless otherwise stated, the financial information relating to
Ladbrokes Coral is extracted (without adjustment) from management accounts and
audited consolidated financial statements for Ladbrokes Coral for the year
ended 31 December 2016 which shows the pro-forma information for Ladbrokes
Coral from the interim results statement of Ladbrokes Coral for the six months
ended 30 June 2017 or the 2017 latest estimate financial information (actual
for January to October 2017 and forecast for November - December 2017);
· GVC then assessed the increase in staff costs and operating expenses
required from the GVC 2016 cost base to support Ladbrokes Coral's business
operations (the "GVC Plus methodology"), after giving effect to the sale of
GVC's Turkish facing business (completed in December 2017) and the sale of GVC
Kalixa business (completed in May 2017). The GVC 2016 cost base and the
assessed increase in staff costs and operating expenses were added to
establish the ending cost base under the GVC Plus methodology (the "Final Cost
Base");
· The gross synergies (the "Gross Synergies") were calculated as the
Initial Cost Base minus the Final Cost Base;
· During 2016 and 2017 GVC was integrating the bwin.party business, with
expectation of significant cost savings which were publicly announced in
September 2015 to be E125 million. GVC identified those elements of the Gross
Synergies which were due to the GVC/bwin.party integration programme (the
"bwin.party Synergies"), and confirmed that the bwin.party Synergies would
still be achieved if the Acquisition proceeded;
· During 2016 and 2017 Ladbrokes and Coral have been integrating their
businesses, with expectation of significant synergies which were publicly
announced in July 2017 to be £150 million. GVC and Ladbrokes identified those
elements of the Gross Synergies which were due to the Ladbrokes/Coral
integration programme (the "Ladbrokes/Coral Synergies"), and confirmed that
the Ladbrokes/Coral Synergies would still be achieved if the Acquisition
proceeded;
· The potential synergies available from the Acquisition were calculated
as the Gross Synergies minus the bwin.party Synergies minus the
Ladbrokes/Coral Synergies;
· The phasing of the benefits and the one-off costs involved in
delivering the potential synergies were assessed as part of this process; and
· Gross incremental synergies (after deducting synergies from previous
transactions) were risk-weighted by GVC Management, reflecting their
assessment on the likely delivery of the targeted benefits.
GVC Management have used an exchange rate of 1.150 E/£
Reports
As required by Rule 28.1(a) of the Takeover Code, Grant Thornton, as reporting
accountants to GVC, have provided a report stating that, in their opinion, the
Quantified Financial Benefits Statement has been properly compiled on the
basis stated. In addition Houlihan Lokey as financial adviser to GVC, has
provided a report stating that, in its opinion, the Quantified Financial
Benefits Statement has been prepared with due care and consideration.
Copies of these reports are included in Parts B and C of this Appendix IV.
Grant Thornton and Houlihan Lokey have given and not withdrawn their consent
to the publication of their reports in the form and context in which they are
included.
Notes
1 The statements of estimated cost synergies relate to future actions
and circumstances which, by their nature, involve risks, uncertainties and
contingencies. As a result, the cost synergies referred to may not be
achieved, or may be achieved later or sooner than estimated, or those achieved
could be materially different from those estimated. No statement in the
Quantified Financial Benefits Statement, or this Announcement generally,
should be construed as a profit forecast or interpreted to mean that the
Enlarged Group's earnings in the first full year following the Acquisition, or
in any subsequent period, would necessarily match or be greater than or be
less than those of GVC and/or Ladbrokes Coral for the relevant preceding
financial period or any other period
2 Due to the scale of the Enlarged Group, there may be additional
changes to the Enlarged Group's operations. As a result, and given the fact
that the changes relate to the future, the resulting cost synergies may be
materially greater or less than those estimated.
3 In arriving at the estimate of cost synergies set out in this
Announcement, the GVC Directors have assumed that there will be no significant
impact on the underlying operations of either business as a result of the
Acquisition or the Triennial Review.
Part B
Report from Grant Thornton UK LLP on the Quantified Financial Benefits
Statement
Grant Thornton UK LLP
30 Finsbury Square
London
EC2P 2YU
The Directors
GVC Holdings Plc
32 Athol Street
Douglas
Isle of Man
IM1 1JB
Houlihan Lokey EMEA, LLP
83 Pall Mall
London
SW1Y 5ES
22 December 2017
Dear Sirs,
GVC Holdings plc (the Company) - the Quantified Financial Benefits Statement
We report on the statement made by the directors of the Company (the
Directors) on the quantified financial benefits set out in Part A of Appendix
IV to the announcement (Statement) issued by the Company on 22 December 2017
(Announcement).
The Statement has been made in the context of the disclosures in Part A of
Appendix IV to the Announcement setting out, inter alia, the bases of the
belief of the Directors (including sources of information and assumptions)
supporting the Statement and their analysis and explanation of the underlying
constituent elements.
This report is required by Rule 28.1 (a)(i) of The City Code on Takeovers and
Mergers (the Code) and is given for the purpose of complying with that rule
and for no other purpose.
Responsibilities
It is the responsibility of the Directors to prepare the Statement in
accordance with the requirements of the Code.
It is our responsibility to form an opinion, as required by Rule 28.1(a)(i) of
the Code as to whether the Statement has been properly compiled on the basis
stated and to report that opinion to you.
Save for any responsibility arising under Rule 28.1(a)(i) of the Code to any
person as and to the extent there provided, to the fullest extent permitted by
law we do not assume any responsibility and will not accept any liability to
any other person for any loss suffered by any such other person as a result
of, arising out of, or in connection with this report, which is required by
and given solely for the purposes of complying with Rule 23.2(b) of the Code,
or our statement consenting to its inclusion in the Announcement.
Basis of opinion
We conducted our work in accordance with the Standards for Investment
Reporting issued by the Auditing Practices Board in the United Kingdom. Our
work included considering whether the Statement has been accurately computed
based upon the disclosed bases of belief (including the principal
assumptions). Whilst the basis of belief (and the principal assumptions) upon
which the Statement is based are solely the responsibility of the Directors,
we considered whether anything came to our attention to indicate whether any
of the bases of belief (or principal assumptions) adopted by the Directors
which, in our opinion, are necessary for a proper understanding of the
Statement have not been disclosed and whether any bases of belief (or
principal assumption) made by the Directors appears to us to be unrealistic.
Our work did not involve any independent examination of any of the financial
or other information underlying the Statement.
We planned and performed our work so as to obtain the information and
explanations we considered necessary in order to provide us with reasonable
assurance that the Statement has been properly compiled on the basis stated.
We have discussed the Statement together with the bases of belief (including
sources of information and assumptions) with the Directors and with Houlihan
Lokey EMEA, LLP.
Since the Statement (and the principal assumptions on which it is based)
relates to the future and may therefore be affected by unforeseen events, the
actual financial benefits achieved are likely to be different from those
anticipated in the Statement and differences may be material. Accordingly, we
can express no opinion as to the achievability of the financial benefits
identified by the Directors in the Statement.
Our work has not been carried out in accordance with auditing or other
standards and practices generally accepted outside the United Kingdom,
including the United States of America and accordingly should not be relied
upon as if it had been carried out in accordance with those standards and
practices.
Opinion
In our opinion, on the basis of the foregoing, the Statement has been properly
compiled on the basis stated.
Yours faithfully
Grant Thornton UK LLP
Chartered Accountants
Grant Thornton UK LLP is a limited liability partnership registered in England
and Wales: No.OC307742. Registered office: 30 Finsbury Square, London EC2A
1AG.
Grant Thornton UK LLP is authorised and regulated by the Financial Conduct
Authority. Grant Thornton UK LLP is a member firm of Grant Thornton
International Ltd (GTIL). GTIL and the member firms are not a worldwide
partnership. Services are delivered by the member firms. GTIL and its member
firms are not agents of, and do not obligate, one another and are not liable
for one another's acts or omissions.
Part C
Report from Houlihan Lokey on the Quantified Financial Benefits Statement
The Directors
GVC Holdings Plc
32 Athol Street
Douglas, Isle of Man
IM1 1JB
22 December 2017
Dear Sirs,
We refer to the Quantified Financial Benefits Statement, the bases of belief
thereof and the notes thereto (together, the "Statement"), for which the
Directors of GVC are solely responsible under Rule 28 of the City Code on
Takeovers and Mergers (the "Code").
We have discussed the Statement (including the assumptions and sources of
information referred to therein), with the Directors of GVC and those officers
and employees of GVC who developed the underlying plans. The Statement is
subject to uncertainty as described in this Announcement and our work did not
involve an independent examination of any of the financial or other information
underlying the Statement.
We have relied upon the accuracy and completeness of all the financial and
other information provided to us by, or on behalf of, GVC, or otherwise
discussed with or reviewed by us, and we have assumed such accuracy and
completeness for the purposes of providing this letter. We have also reviewed
the work carried out by Grant Thornton LLP and have discussed with them the
opinion set out in their letter of 22 December 2017 addressed to the Directors
of GVC and ourselves.
We do not express any opinion as to the achievability of the quantified
financial benefits identified by the Directors of GVC.
We have also reviewed the work carried out by Grant Thornton and have
discussed with them the opinion set out in Part B of Appendix IV of this
Announcement addressed to yourselves and ourselves on this matter.
This letter is provided pursuant to our engagement letter with GVC solely to
the Directors of GVC in connection with Rule 28.1(a)(ii) of the Takeover Code
and for no other purpose. We accept no responsibility to GVC or its
shareholders or any person other than the Directors of GVC in respect of the
contents of, or any matter arising out of or in connection with, this letter.
No person other than the Directors of GVC can rely on the contents of this
letter, and to the fullest extent permitted by law, we exclude all liability
(whether in contract, tort or otherwise) to any other person in respect of
this letter, its results, or the work undertaken in connection with this
letter, or any of the results that can be derived from this letter or any
written or oral information provided in connection with this letter, and any
such liability is expressly disclaimed except to the extent that such
liability cannot be excluded by law.
On the basis of the foregoing, we consider that the Statement, for which the
Directors of GVC are solely responsible, has been prepared with due care and
consideration.
Yours truly,
Houlihan Lokey EMEA, LLP
APPENDIX V
DEFINITIONS
The following definitions apply throughout this Announcement unless the
context requires otherwise:
"£", "GBP", "pence" or "p" pounds sterling, the lawful currency of the United Kingdom
"Acquisition" the acquisition by GVC of Ladbrokes Coral to be effected by means of the Scheme, or a Takeover Offer on the terms and subject to the Conditions set out in this Announcement and, where the context admits, any subsequent revision, variation, extension or
renewal thereof
"Admission" the satisfaction of the Conditions in paragraph 3(b) of Part A Appendix I to this Announcement in respect of the admission of the New GVC Shares to (i) the premium listing segment of the Official List and (ii) trading on the main market for listed
securities of the London Stock Exchange
"Announcement" this announcement, made in accordance with Rule 2.7 of the Takeover Code, including its summary and appendices
"Authorisations" any and all authorisations, orders, grants, recognitions, determinations, confirmations, consents, licences, clearances, permissions, exemptions and approvals
"B2 Standards" "Base Value" the "Machine standards category B2" Revision 2, dated June 2012 as published by the UKGC as at the date of the CVR Instrumenthas the meaning given in paragraph 4 of this Announcement
"Board" in relation to GVC and Ladbrokes Coral, the board of directors of the relevant company
"Business Day" a day, not being a public holiday, Saturday or Sunday, on which banks in the City of London are open for normal banking business
"Cash Coverage Agreement" has the meaning given in paragraph 22 of this Announcement
"Clean Break Notice" has the meaning given in paragraph 8 of this Announcement
"Clean EBITDA" earnings before interest, taxation, depreciation, amortisation, impairment charges, changes in the fair value of derivative financial instruments, share option charges and exceptional items after accounting for net synergies from the transaction and the
impact of the Triennial Review, and before transaction costs and one-time restructuring charges
"Closing Price" the closing middle market price of a share as derived from the Daily Official List on any particular date
"CMA" the Competition and Markets Authority in the United Kingdom
"Code" or "Takeover Code" the City Code on Takeovers and Offers in the United Kingdom
"Coral" Coral Group Limited, a company incorporated in England and Wales with registered number 05282058
"Coral Annual Report and Financial Statements" the annual report and audited financial statements of Coral for the year ended 26 September 2015
"Companies Act" the Companies Act 2006
"Completion" the day on which the Acquisition becomes Effective
"Conditions" the conditions of the Acquisition, as set out in Appendix I to this Announcement and to be set out in the Scheme Document
"Confidentiality Agreement" the confidentiality agreement entered into between GVC and Ladbrokes Coral dated 10 November 2016
"Consulting Parties" has the meaning given in paragraph 4 of this Announcement
"Co-operation Agreement" the agreement dated 22 December 2017 between GVC and Ladbrokes Coral relating, among other things, to commitments to provide information and assistance for the purposes of obtaining official authorisation or regulatory clearance
"Coral" Coral Group Limited, a company incorporated in England and Wales with registered number 05282058
"Coral Annual Report and Financial Statements" the annual report and audited financial statements of Coral for the year ended 26 September 2015
"Court" the High Court of Justice in England and Wales
"Court Hearing" the hearing of the Court to sanction the Scheme
"Court Meeting" the meeting(s) of Scheme Shareholders (or the relevant class or classes therefore, if applicable) to be convened pursuant to an order of the Court pursuant to section 896 of the Companies Act, notice of which will be set out in the Scheme Document, for the
purpose of considering and, if thought fit, approving the Scheme (with or without amendment), including any adjournment, postponement or reconvention thereof
"Court Order" the order of the Court sanctioning the Scheme under section 899 of the Companies Act
"CREST" the relevant system (as defined in the Uncertificated Securities Regulations 2001 (SI 2001/3755)) in respect of which Euroclear is the operator (as defined in such Regulations) in accordance with which securities may be held and transferred in
uncertificated form
"CVRs" the contingent value rights constituted by the CVR Instrument issued to holders of Scheme Shares
"CVR Holder" a holder of a CVR
"CVR Instrument" the deed poll dated the date of this Announcement and entered into by GVC, under which the CVRs have been constituted
"CVR Representative" has the meaning given in paragraph 4 of this Announcement
"Daily Official List" the daily official list of the London Stock Exchange
"DCMS" the Department for Digital, Culture, Media & Sport of the UK Government, or any successor to such department
"Disclosed" information which has been fairly disclosed: (i) by, or on behalf of, Ladbrokes Coral to GVC (or its advisers) in a data room established by GVC for the purposes of the Acquisition or otherwise in writing; (ii) in the Ladbrokes Coral Annual Report and
Accounts or in the Coral Annual Report and Financial Statements; (iii) in any announcement to a Regulatory Information Service by, or on behalf of, Ladbrokes Coral, prior to the publication of this Announcement; or (iv) in this Announcement
"Early Redemption Date" has the meaning given in paragraph 4 of this Announcement
"EBITDA" earnings before interest, taxation, depreciation and amortisation
"EBITDA Impact Projection" has the meaning given in paragraph 4 of this Announcement
"Effective" the Scheme having become effective pursuant to its terms or, if the Acquisition is implemented by way of a Takeover Offer, the Takeover Offer having been declared or having become unconditional in all respects in accordance with the requirements of the
Takeover Code
"Effective Date" the date upon which the Court Order is filed at Companies House
"Enacted" in respect of a particular Triennial Measure, either:(a) a statutory instrument in respect of such Triennial Measure having been laid before Parliament by the UK Government pursuant to section 172 or section 240 of the Gambling Act, and a period of 40
calendar days having elapsed since the date of such statutory instrument having been laid before Parliament, without a petition having been presented either by the House of Commons or the House of Lords for the annulment of such statutory instrument; or(b)
a statutory instrument in respect of such Triennial Measure having been proposed to Parliament by the UK Government pursuant to section 236 of the Gambling Act, and an affirmative vote in respect of such statutory instrument having been obtained from
both the House of Commons and the House of Lords; or(c) Royal Assent in respect of any primary legislation to give effect to any such Triennial Measure having been given; or(d) the making by the UKGC of a specification of a licence condition
pursuant to section 76 of the Gambling Act (after any necessary consultation period having occurred) to bring into effect such Triennial Measure, or the following of any equivalent process in respect of any amendment to the B2 Standards,and "Enactment"
shall be construed accordingly
"Enlarged Group" the GVC Group as enlarged by the Ladbrokes Coral Group following Completion
"Envisaged Maximum Stake" any of the possible Maximum Stakes set out in the Row 1 of the Maximum Stakes Table
"EPS" earnings per share
"EU" the European Union
"EU Merger Regulation" Council Regulation (EC) No 139/2004
"Euroclear" Euroclear UK and Ireland Limited
"Excluded Shares" (a) any Ladbrokes Coral Shares which are registered in the name of or beneficially owned by GVC or its nominee(s) or any subsidiary undertaking of GVC or its nominee(s); and(b) any Ladbrokes Coral Shares held in treasury (unless
such Ladbrokes Coral Shares cease to be so held)
"Expert" has the meaning given in paragraph 4 of this Announcement
"FCA" or "Financial Conduct Authority" the UK Financial Conduct Authority or its successor from time to time
"Final Redemption Date" has the meaning given in paragraph 4 of this Announcement
"FOBT" a gaming machine falling within regulation 5(5) of the Categories of Gaming Machine Regulations 2007 (SI 2007/2158) as amended, made by the DCMS pursuant to section 236(1) of the Gambling Act
"Form of Election" the form of election for use by an eligible Scheme Shareholder to participate in the Mix and Match Facility
"Forms of Proxy" the forms of proxy in connection with each of the Court Meeting and the Ladbrokes Coral General Meeting, which shall accompany the Scheme Document
"FSMA" the Financial Services and Markets Act 2000, as amended
"Gambling Act" the UK Gambling Act 2005
"Grant Thornton" Grant Thornton UK LLP
"Greenhill" Greenhill & Co. International LLP
"GVC" GVC Holdings plc, a company incorporated in the Isle of Man with registered number 4685V
"GVC Directors" the Board of GVC at the date of this Announcement
"GVC General Meeting" the general meeting of GVC Shareholders to be convened in connection with the Proposals to consider and, if thought fit, pass the GVC Resolutions, including any adjournment, postponement or reconvention thereof
"GVC Group" GVC and its subsidiaries and subsidiary undertakings and, where the context admits, each of them
"GVC Permitted Dividend" has the meaning given in paragraph 16 of this Announcement
"GVC Prospectus" the combined prospectus and shareholder circular to be published by GVC in connection with the Proposals and sent to GVC Shareholders and Ladbrokes Coral Shareholders summarising, amongst other things, the background to and reasons for the Acquisition and
containing details of, amongst other things, the Enlarged Group and the New GVC Shares, which will include a notice convening the GVC General Meeting
"GVC Representative" has the meaning given in paragraph 4 of this Announcement
"GVC Resolutions" the resolutions to be proposed at the GVC General Meeting in connection with the Acquisition, including, amongst other things, resolutions to: to (i) approve, effect and implement the Acquisition including the grant of uncapped indemnities to the GVC
Representative and the CVR Representative (under the Listing Rules, as a "Class 1" transaction); (ii) authorise an increase in the authorised share capital of GVC; (iii) confer authorities for the issue and allotment of the New GVC Shares to be issued
pursuant to the Acquisition; (iv) the disapplication of pre-emption rights in respect of the allotment of the New GVC Shares in accordance with article 5.2 (d) of the articles of association of GVC; and (v) the amendment of the articles of association of
GVC in connection with the proposed increase in the share capital of GVC to be set out in the notice of general meeting of GVC in the GVC Prospectus
"GVC Shareholders" holders of GVC Shares from time to time
"GVC Shares" fully paid up ordinary shares of E0.01 nominal value each in the share capital of GVC
"Houlihan Lokey" Houlihan Lokey EMEA, LLP
"Investec" Investec Bank plc
"Ladbrokes Coral" Ladbrokes Coral Group plc, a company incorporated in England and Wales with registered number 00566221
"Ladbrokes Coral Annual Report and Accounts" the annual report and audited financial statements of Ladbrokes Coral for the year ended 31 December 2016
"Ladbrokes Coral Directors" the Board of Ladbrokes Coral at the date of this Announcement
"Ladbrokes Coral General Meeting" the general meeting of Scheme Shareholders to be convened in connection with the Scheme to consider, and if thought fit pass, inter alia, the Ladbrokes Coral Resolutions, including any adjournment, postponement or reconvention thereof
"Ladbrokes Coral Group" Ladbrokes Coral and its subsidiaries and subsidiary undertakings and, where the context admits, any of them
"Ladbrokes Coral Meetings" the Court Meeting and the Ladbrokes Coral General Meeting
"Ladbrokes Coral Permitted Dividend" has the meaning given thereto in paragraph 16 of this Announcement
"Ladbrokes Coral Resolutions" the resolutions to be proposed by Ladbrokes Coral at the Ladbrokes Coral General Meeting in connection with, amongst other things, to authorise the directors to take all required action in relation to the Scheme, the amendment of Ladbrokes Coral's articles
of association, the delisting of Ladbrokes Coral, its reregistration as a private limited company and such other matters as may be necessary to implement the Scheme
"Ladbrokes Coral Shareholders" the holders of Ladbrokes Coral Shares
"Ladbrokes Coral Shares" fully paid up ordinary shares of 28⅓ pence nominal value each in the share capital of Ladbrokes Coral
"Ladbrokes Coral Share Schemes" the Ladbrokes Coral 1978 Share Option Scheme, the Ladbrokes Coral Executive Deferred Bonus Plan, the Ladbrokes Coral Performance Share Plan, the Ladbrokes Coral Restricted Share Plan, the Ladbrokes Coral 1983 Savings Related Option Scheme and the Ladbrokes
Coral Share Incentive Plan
"Ladbrokes Coral UK Business" the Ladbrokes Coral business of operating LBOs in England, Scotland and Wales
"Last Practicable Date" 21 December 2017 (being the latest practicable date prior to the publication of this Announcement)
"LBO" a premises in respect of which a betting premises licence (as defined in section 150(1)(e) of the Gambling Act) has been issued by a licensing authority (as defined in section 2 of the Gambling Act)
"Linear Interpolation" in circumstances where the Maximum Stake stipulated in the Maximum Stakes Measures falls between two Envisaged Maximum Stakes which are adjacent to one another in Row 1 of the Maximum Stakes Table, determining the Base Value associated with that stipulated
Maximum Stake by assuming that the Base Value figure in Row 2 directly below the lower of those Envisaged Maximum Stakes in Row 1 of the Maximum Stakes Table increases on a straight-line basis up to the Base Value figure in Row 2 directly below the higher
of those Envisaged Maximum Stakes in Row 1 of the Maximum Stakes Table, and "Linearly Interpolated" shall be construed accordingly
"Listing Rules" the rules and regulations made by the FCA under Part VI of the FSMA, and containing the UK Listing Authority's publication of the same name, as amended from time to time
"Loan Note Issue Date" the date of issuance of the Loan Notes, being within 14 days of the final determination of the Loan Note Principal Value
"Loan Notes" any Loan Notes issued pursuant to the CVR Instrument
"Loan Note Instrument" the deed poll constituting the Loan Notes to be made by GVC in certain circumstances following determination of the Loan Note Principal Value
"Loan Note Principal Value" has the meaning given in paragraph 4 of this Announcement
"London Stock Exchange" the London Stock Exchange plc or its successor from time to time
"Long Stop Date" 30 June 2018 or such later date as Ladbrokes Coral and GVC may agree in writing, with the Panel's consent and the Court may approve (if such consent and/or approval is required)
"Maximum Machines Measures" has the meaning given in paragraph 4 of this Announcement
"Maximum Stake" the maximum stake which may be wagered by a player on any particular game cycle on a FOBT, disregarding any conditions imposed by law or regulation that may have to be satisfied before such maximum stake may be wagered
"Maximum Stakes Measures" any changes to the Maximum Stake which are Enacted on or prior to the first anniversary of the Effective Date
"Maximum Stakes Table" the table set out in paragraph 4 of this Announcement under the heading "Scenario 1"
"MGA" the Malta Gaming Authority
"Mix and Match Facility" the mix and match facility under which eligible Ladbrokes Coral Shareholders will be able to elect, subject to there being equal and opposite elections made by other Ladbrokes Coral Shareholders, to vary the proportions in which they receive New GVC Shares
and cash under the Acquisition
"Net Gaming Revenue" or "NGR" the fair value of consideration received or receivable. In sportsbetting, NGR is calculated as the gains and losses in respect of bets placed on sporting events which have taken place in the period, stated net of betting taxes and certain promotional
bonuses. In casino and gaming, NGR represents the net win in respect of bets placed in games that have concluded in the period, stated net of promotional bonuses. In poker, NGR represents the rake or commission for games that have concluded in the period,
net of certain promotional bonuses;
"New GVC Shares" the new GVC Shares proposed to be issued to Ladbrokes Coral Shareholders in connection with the Acquisition
"Offer Period" the offer period (as defined by the Takeover Code) relating to Ladbrokes Coral, which
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