RECOMMENDED CASH ACQUISITION OF MEDICA GROUP PLC
24/04/2023 07:00
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RNS Number : 1397X IK Investment Partners Limited 24 April 2023
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FROM ANY JURISDICTION WHERE TO DO SO WOULD CONSTITUTE A VIOLATION OF THE
RELEVANT LAWS OF THAT JURISDICTION
THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION
FOR IMMEDIATE RELEASE
24 April 2023
RECOMMENDED CASH ACQUISITION
OF
MEDICA group PLC
BY
moonlight BIDCO LIMITED
a newly incorporated wholly-owned subsidiary of funds advised by
IK INVESTMENT PARTNERS LIMITED
to be implemented by means of a Scheme of Arrangement
under Part 26 of the Companies Act 2006
Summary
· The boards of Moonlight Bidco Limited ("Bidco") and
Medica Group plc ("Medica") are pleased to announce that they have reached
agreement on the terms and conditions of a recommended all cash offer by Bidco
for the entire issued and to be issued ordinary share capital of Medica (the
"Acquisition"). The Acquisition is intended to be implemented by means of a
scheme of arrangement under Part 26 of the Companies Act.
· Under the terms of the Acquisition, each Medica
Shareholder will be entitled to receive:
for each Medica Share: 212 pence in cash
· The Acquisition values the entire issued, and to be
issued, ordinary share capital of Medica at approximately £269 million.
· The price per Medica Share represents a premium of
approximately:
- 32.5 per cent. to the Closing Price of 160.0
pence per Medica Share on 21 April 2023 (being the last Business Day before
the date of the commencement of the Offer Period);
- 32.4 per cent. to the volume-weighted
average price of 160.1 pence per Medica Share for the three-month period ended
21 April 2023; and
- 50.0 per cent. to the volume-weighted
average price of 141.3 pence per Medica Share for the six-month period ended
21 April 2023.
· If any dividend, distribution and/or return of
value is proposed, authorised, declared, made or paid or becomes payable in
respect of Medica Shares on or after the date of this Announcement and before
the Effective Date (including the 2022 Final Dividend), Bidco reserves the
right to reduce the Consideration by the amount of any such dividend,
distribution and/or other return of value.
Information on Bidco, IK and IK Partners
· Bidco is a private company limited by shares
registered in England and Wales and incorporated on 14 April 2023 with company
number 14801401. Bidco was formed for the purposes of the Acquisition and
has not traded since its date of incorporation, nor has it entered into any
obligations other than in connection with the Acquisition.
· Bidco is indirectly owned by funds advised by IK.
· Since its inception in 1989, IK Partners has
initiated, structured, and financed over 170 private equity transactions
across Europe, completed over 400 add-on acquisitions, and raised c. EUR 14
billion of capital. IK Partners continues to be one of Europe's most active
private equity firms, having made 33 platform investments since January
2021. IK Partners has 7 offices across Europe, as well as an office in the
USA, with over 185 employees across the group. IK Partners seeks to provide
support to its portfolio companies to accelerate growth.
· IK Partners has a well-established track record of
investing in successful companies across the Healthcare sector. To date, IK
Partners has invested in 23 healthcare companies across Europe, for which it
has deployed approximately EUR 2.1 billion of capital.
Information on Medica
· Medica is an international provider of high-quality
telemedicine services and a market leading teleradiology provider in the UK
and Ireland. In the UK and Ireland, Medica provides outsourced interpretation
and reporting of acute and non-acute MRI (magnetic resonance imaging), CT
(computerised tomography), ultrasound and plain film (x-ray) images to more
than 100 NHS Trusts in the UK, the Irish HSE, private hospitals and insurance
groups, as well as diagnostic imaging companies. Medica also manages diabetic
retinopathy screening on behalf of the National Screening Service in Ireland.
· Through its subsidiary in the United States, RadMD,
Medica provides pharmaceutical and biotech clients and contract research
organisations (CROs) with high quality imaging services for clinical trials.
RadMD has contributed to over 500 international clinical trials, in all phases
of clinical research from proof of concept to phase III and has specific
expertise in oncology, as well as a wider range of therapeutic areas.
· Founded in 2004, Medica is listed on the Premium
Segment of the Official List and was admitted to trading on the Main Market of
the London Stock Exchange in 2017. Medica is headquartered in Hastings, United
Kingdom and currently employs over 400 people globally with operations in the
United Kingdom, Ireland, the United States of America and Australia.
Background to and reasons for the Acquisition
· Bidco considers Medica to be a high-quality
business that is a leader in the global teleradiology and wider imaging
diagnostics sector, playing an important role in providing high-quality
diagnostic information and reports for its customers. Bidco has a high degree
of respect for the management team of Medica and the strategy they have
implemented and believes that Medica represents a compelling investment
opportunity to acquire a leading player in the global teleradiology and wider
imaging diagnostics marketplace. Medica has a long-standing reputation for
superior quality of teleradiology reporting, a compelling and differentiated
proposition for radiologists, strong customer advocacy and consistent
reliability of the services that it offers.
· Over the past few years, Medica has begun to
diversify and internationalise the range of services that it offers. Bidco
believes that Medica is better able to achieve its full potential in a private
market setting enabled by the acceleration of investment in growth.
Underpinned by best-in-class clinical governance, a strong focus on customer
service and quality, coupled with further investment in its technology
platform, Bidco considers that as a private company Medica will be better able
to:
- contribute as a key partner for its
teleradiology customers to help them meet the challenges they face due to the
significant demand and backlog for diagnostic imaging against the backdrop of
a structural shortage of radiologists;
- accelerate, both organically and through
M&A, growth in specialist imaging services to the Contract Research sector
globally; and
- accelerate the opportunity for growth within
digital telepathology and broader telemedicine services for existing and new
customers.
Recommendation
· Following careful consideration, the Directors of
Medica have concluded that the terms of the Acquisition reflect the strength
of Medica's business, team and its prospects, whilst providing shareholders
the opportunity to realise the value of their holdings today in cash in full
at a meaningful premium to recent trading and at a value that reflects the
future growth potential of the business.
· The Directors of Medica have taken all relevant
factors into account in considering the terms of the Acquisition, including
discussions held with strategic and financial parties following unsolicited
inbound interest.
· The Medica Directors, who have been so advised by
Evercore as to the financial terms of the Acquisition, consider the terms of
the Acquisition to be fair and reasonable. In providing its advice, Evercore
has taken into account the commercial assessments of the Medica Directors.
Evercore is providing independent financial advice to the Medica Directors
for the purposes of Rule 3 of the Takeover Code.
· Accordingly, the Medica Directors confirm that they
intend to recommend unanimously that Medica Shareholders vote or procure votes
to approve the Scheme at the Court Meeting and to vote or procure votes in
favour of the Resolutions to be proposed at the General Meeting, as they have
irrevocably undertaken to do (or procure to be done) in respect of their own
holdings over which they have control, being, in aggregate, 211,411 Medica
Shares representing approximately 0.2 per cent. of the ordinary share capital
of Medica in issue as at the Latest Practicable Date.
Irrevocable undertakings
· In addition to the irrevocable undertakings given
by the Medica Directors, Bidco has also received irrevocable undertakings from
certain Medica Shareholders to vote or procure votes to approve the Scheme at
the Court Meeting and to vote or procure votes in favour of the Resolutions to
be proposed at the General Meeting.
· On 21 April 2023 (being the Latest Practicable
Date) these irrevocable undertakings together represented, in aggregate,
24,356,663 Medica Shares representing approximately 19.9 per cent. of the
ordinary share capital of Medica in issue as at the Latest Practicable Date.
· Bidco has, therefore, received irrevocable
undertakings in respect of a total of 24,568,074 Medica Shares representing,
in aggregate, approximately 20.0 per cent. of the existing issued share
capital of Medica on the Latest Practicable Date.
· Full details of the irrevocable undertakings,
including the terms under which they cease to be binding, are set out in
Appendix 3 to this Announcement.
Timetable and Conditions
· It is intended that the Acquisition will be
implemented by means of a court-sanctioned scheme of arrangement under Part 26
of the Companies Act (although Bidco reserves the right to effect the
Acquisition by way of a Takeover Offer, subject to the consent of the Panel
and the terms of the Co-operation Agreement).
· The terms of the Acquisition will be put to Medica
Shareholders at the Court Meeting and the General Meeting. The Court Meeting
and the General Meeting are required to enable Medica Shareholders to
consider, and if thought fit, vote in favour of the Scheme and the Resolutions
to implement the Scheme. In order to become Effective, the Scheme must be
approved by a majority in number of Scheme Shareholders, present and voting at
the Court Meeting (and entitled to vote), whether in person or by proxy,
representing at least 75 per cent. in value of the Scheme Shares held by those
Scheme Shareholders who have voted. In addition, at the General Meeting the
Resolutions must each be passed by Medica Shareholders representing at least
75 per cent. of the votes validly cast on such Resolutions, whether in person
or by proxy. The General Meeting is expected to be held immediately after
the Court Meeting.
· The Scheme will also need to be sanctioned by the
Court. Finally, a copy of the Court Order must be delivered to the Registrar
of Companies for registration, upon which the Scheme will become Effective.
· The Acquisition will be made in accordance with the
Takeover Code and on the terms and subject to the Conditions set out in
Appendix 1 to this Announcement. Full details of the Acquisition will be set
out in the Scheme Document.
· It is expected that the Scheme Document, containing
further information about the Acquisition and notices of the Court Meeting and
the General Meeting, together with the associated forms of proxy, will be
posted to Medica Shareholders within 28 days of this Announcement (or such
later time as Medica, Bidco and the Panel agree) and the Meetings are expected
to be held shortly thereafter.
· The Acquisition is currently expected to become
Effective around the end of Q2 2023, subject to the satisfaction (or, where
applicable, waiver) of the Conditions and further terms set out in Appendix 1
to this Announcement. An expected timetable of key events relating to the
Acquisition will be provided in the Scheme Document.
Comments on the Acquisition
· Commenting on the Acquisition, Roy Davis, Chairman
of Medica, said:
"Since its establishment in 2004, Medica has become the UK's market leading
teleradiology player and a trusted partner to over half of NHS hospital
organisations, as well as providing a range of imaging services from our more
recent, high growth businesses in Ireland and the United States. Medica has
made significant progress delivering against its strategy to diversify and
scale the business alongside investments in our technology platform and
reporter capacity which position us to compete strongly in a highly
competitive market.
The Board of Medica believes that the offer from Bidco represents an
attractive and certain value in cash today for Medica shareholders which
reflects our reputation as a leading, high-quality teleradiology and wider
telemedicine provider with a compelling service offering. The Board of Medica
believes that IK Partners is a strong and credible partner for the business
and is well positioned to support its next phase of development, including
accelerating investment in the company which will benefit our customers and
their patients going forward.
The hard work and outstanding contribution of Medica's management team,
employees and its dedicated network of radiologists, radiographers and
specialist doctors has made Medica the business it is today. The Board
believes that Bidco's plans to continue to invest in the training,
development, and expansion of Medica's global employee base will support
management's growth plans and the continued provision of essential fast and
reliable reporting to support our customers."
· Commenting on the Acquisition, Pete Wilson, Head of
IK Partners' UK Mid Cap strategy said:
"We are pleased that the board of Medica has unanimously agreed to recommend
the Acquisition of Medica by Bidco.
Medica has a long-established track record of serving customers and, in turn,
their patients in telemedicine, across the UK and Ireland in teleradiology and
in the US in complex imaging services.
We believe that under Bidco's ownership, Medica will be able to invest further
in its people, technology, and new capabilities which will allow it to better
serve its customers, healthcare professionals and ultimately, continue to help
improve patient outcomes."
This summary should be read in conjunction with, and is subject to, the full
text of the following announcement (including its Appendices). The
Acquisition will be subject to the Conditions and certain further terms set
out in Appendix 1 to this Announcement and to the full terms and conditions
which will be set out in the Scheme Document. Appendix 2 to this
Announcement contains the sources of information and bases of calculations of
certain information contained in this Announcement. Appendix 3 to this
Announcement contains a summary of the irrevocable undertakings received by
Bidco in relation to this Acquisition. Appendix 4 to this Announcement
contains definitions of certain terms and expressions used in this summary and
in the following announcement (including its Appendices).
Enquiries:
Jefferies +44 (0) 20 7029 8000
(Financial Adviser to Bidco and IK)
James Thomlinson
Ashwin Pai
William Brown
IK +44 (0) 20 7304 7153
(Marketing and Communications Manager) vidya.verlkumar@ikpartners.com
Vidya Verlkumar
H/Advisors Maitland +44 (0) 20 7379 5151
(Public Relations Adviser to Bidco and IK) IK-Maitland@h-advisors.global
Vikki Kosmalska
Finlay Donaldson
Medica +44 (0)33 33 111 222
Stuart Quin, Chief Executive Officer
Richard Jones, Chief Financial Officer
Evercore +44 (0) 20 7653 6000
(Lead Financial Adviser to Medica)
Julian Oakley
Simon Elliott
Harrison George
Liberum +44 (0) 20 3100 2000
(Joint Financial Adviser and Joint Broker to Medica)
Phil Walker
Mark Harrison
Richard Lindley
Numis +44 (0) 20 7260 1000
(Joint Financial Adviser and Joint Broker to Medica)
Freddie Barnfield
Stuart Ord
Duncan Monteith
FTI Consulting +44 (0) 20 3727 1000
(Public Relations Adviser to Medica) medicagroupplc@fticonsulting.com
Ben Atwell
Victoria Foster Mitchell
Sam Purewal
Travers Smith LLP is acting as legal adviser to Bidco and IK.
DLA Piper UK LLP is acting as legal adviser to Medica.
Disclaimers
Jefferies International Limited ("Jefferies"), which is authorised and
regulated in the United Kingdom by the Financial Conduct Authority (the
"FCA"), is acting exclusively as financial adviser to Bidco and IK and for no
one else in connection with the Acquisition and will not be responsible to
anyone other than Bidco and IK for providing the protections afforded to
clients of Jefferies for providing advice in relation to the Acquisition, the
contents of this Announcement or any other matters referred to in this
Announcement. Neither Jefferies 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 Jefferies in connection with this Announcement, any statement
contained herein or otherwise.
Evercore Partners International LLP ("Evercore"), which is authorised and
regulated by the FCA in the UK, is acting exclusively as financial adviser to
Medica and no one else in connection with the matters described in this
Announcement and will not be responsible to anyone other than Medica for
providing the protections afforded to clients of Evercore nor for providing
advice in connection with the matters referred to herein. Neither Evercore nor
any of its subsidiaries, branches or 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 Evercore in connection with this Announcement, any statement
contained herein, any offer or otherwise. Apart from the responsibilities and
liabilities, if any, which may be imposed on Evercore by FSMA and successor
legislation, or the regulatory regime established thereunder, or under the
regulatory regime of any jurisdiction where exclusion of liability under the
relevant regulatory regime would be illegal, void or unenforceable, neither
Evercore nor any of its affiliates accepts any responsibility or liability
whatsoever for the contents of this Announcement, and no representation,
express or implied, is made by it, or purported to be made on its behalf, in
relation to the contents of this Announcement, including its accuracy,
completeness or verification of any other statement made or purported to be
made by it, or on its behalf, in connection with Medica or the matters
described in this Announcement. To the fullest extent permitted by applicable
law, Evercore and its affiliates accordingly disclaim all and any
responsibility or liability whether arising in tort, contract or otherwise
(save as referred to above) which they might otherwise have in respect of this
Announcement or any statement contained herein.
Liberum Capital Limited ("Liberum"), which is authorised and regulated by the
Financial Conduct Authority in the United Kingdom, is acting exclusively for
Medica and no one else in connection with the Acquisition and will not be
responsible to anyone other than Medica for providing the protections afforded
to clients of Liberum nor for providing advice in relation to the Acquisition
or any other matters referred to in this Announcement. Neither Liberum 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 Liberum in
connection with this Announcement, any statement contained herein or
otherwise.
Numis Securities Limited ("Numis"), which is authorised and regulated by the
FCA in the United Kingdom, is acting exclusively for Medica and for no one
else in connection with the Acquisition and/or any other matter referred to in
this Announcement and will not be responsible to anyone other than Medica for
providing the protections afforded to its clients or for providing advice in
relation to the Acquisition, the contents of this Announcement, or another
other matters referred to in this Announcement. Neither Numis nor any of its
subsidiaries, affiliates or branches owes or accepts any duty, liability or
responsibility whatsoever (whether direct, indirect, consequential, whether in
contract, in tort, under statute or otherwise) to any person who is not a
client of Numis in connection with this Announcement, any statement or other
matter or arrangement referred to herein or otherwise.
Further information
This Announcement is for information purposes only and is not intended to, and
does not, constitute or form part of any offer or inducement to sell or an
invitation to purchase, otherwise acquire, subscribe for, sell or otherwise
dispose of, any securities or a solicitation of an offer to buy any
securities, any vote or approval in any jurisdiction pursuant to the
Acquisition or otherwise, nor shall there be any purchase, sale, issuance or
exchange of securities or such solicitation in any jurisdiction in which such
offer, solicitation, sale issuance or exchange is unlawful. The Acquisition
will be made solely by means of the Scheme Document (or, if the Acquisition is
implemented by way of a Takeover Offer, the Offer Document), which will
contain the full terms and conditions of the Acquisition, including details of
how to vote in respect of the Acquisition. Any decision in respect of, or
other response to, the Acquisition should be made only on the basis of the
information in the Scheme Document (or, if the Acquisition is implemented by
way of a Takeover Offer, the Offer Document).
This Announcement has been prepared in connection with proposals in relation
to a scheme of arrangement pursuant to and for the purpose of complying with
English law, the Listing Rules, the Takeover Code, the Market Abuse Regulation
(EU 596/2014) (which is part of UK law by virtue of the European Union
(Withdrawal) Act 2018) and the Disclosure Guidance and Transparency Rules and
information disclosed may not be the same as that which would have been
disclosed if this Announcement had been prepared in accordance with the laws
of jurisdictions outside England. Nothing in this Announcement should be
relied on for any other purpose.
Medica and Bidco will prepare the Scheme Document (or, if the Acquisition is
implemented by way of a Takeover Offer, the Offer Document) to be distributed
to Medica Shareholders at no cost to them. Medica and Bidco urge Medica
Shareholders to read the Scheme Document when it becomes available because it
will contain important information relating to the Acquisition.
This Announcement is not an advertisement and does not constitute a
prospectus, prospectus equivalent document or an exempted document.
Overseas jurisdictions
The release, publication or distribution of this Announcement in or into
certain jurisdictions other than the United Kingdom may be restricted by law
and therefore any persons into whose possession this Announcement comes should
inform themselves of, and observe, such restrictions. Further details in
relation to the Overseas Shareholders will be contained in the Scheme
Document. Any failure to comply with any such restrictions may constitute a
violation of the securities laws of any such jurisdiction. To the fullest
extent permitted by applicable law, the companies and persons involved in the
Acquisition disclaim any responsibility or liability for the violation of such
restrictions by any person.
Unless otherwise determined by Bidco or required by the Takeover Code, and
permitted by applicable law and regulation, the Acquisition shall not be made
available, directly or indirectly, in, into or from a Restricted Jurisdiction
where to do so would violate the laws in that jurisdiction and no person may
vote in favour of the Scheme by any such means from within a Restricted
Jurisdiction or any other jurisdiction if to do so would constitute a
violation of the laws of that jurisdiction. Accordingly, copies of this
Announcement and all documents relating to the Acquisition are not being, and
must not be, directly or indirectly, mailed or otherwise forwarded,
distributed or sent in, into or from a Restricted Jurisdiction where to do so
would violate the laws in that jurisdiction, and persons receiving this
Announcement and all documents relating to the Acquisition (including
custodians, nominees and trustees) must not mail or otherwise distribute or
send them in, into or from such jurisdictions where to do so would violate the
laws in that jurisdiction.
The Acquisition shall be subject to the applicable requirements of the
Takeover Code, the Panel, the London Stock Exchange, the FCA, the Listing
Rules and the Registrar of Companies.
Additional information for US investors in Medica
Medica Shareholders in the United States should note that the Acquisition
relates to the shares of an English company with a listing on the Main Market
and is proposed to be effected by means of a scheme of arrangement under
English law. This Announcement, the Scheme Document and certain other
documents relating to the Acquisition have been or will be prepared in
accordance with English law, the Takeover Code and UK disclosure requirements,
format and style, all of which differ from those in the United States. A
transaction effected by means of a scheme of arrangement is not subject to the
tender offer rules or the proxy solicitation rules under the US Exchange
Act. Accordingly, the Acquisition is subject to the disclosure requirements
of and practices applicable in the United Kingdom to schemes of arrangement,
which differ from the disclosure requirements of the United States tender
offer and proxy solicitation rules. If, in the future, Bidco exercises the
right to implement the Acquisition by way of a Takeover Offer and determines
to extend the offer into the United States, the Acquisition will be made in
compliance with applicable United States laws and regulations, including any
applicable exemptions under the US Exchange Act.
Medica's financial statements, and all financial information that is included
in this Announcement, the Scheme Document or any other documents relating to
the Acquisition, have been or will be prepared in accordance with UK-adopted
international accounting standards and may not be comparable to financial
statements of companies in the United States or other companies whose
financial statements are prepared in accordance with US generally accepted
accounting principles.
The receipt of cash pursuant to the Acquisition by a US holder as
consideration for the transfer of its Medica Shares pursuant to the Scheme
will likely be a taxable transaction for United States federal income tax
purposes and under applicable United States state and local, as well as
foreign and other, tax laws. Each Medica Shareholder is urged to consult
their independent professional adviser immediately regarding the tax
consequences of the Acquisition applicable to them, including under applicable
United States state and local laws, as well as overseas and other, tax laws.
It may be difficult for US holders to enforce their rights and claims arising
out of the US federal securities laws, since Bidco and Medica are located in
countries other than the US, and some or all of their officers and directors
may be residents of countries other than the US. US holders may not be able
to sue a non-US company or its officers or directors in a non-US court for
violations of US securities laws. Further, it may be difficult to compel a
non-US company and its affiliates to subject themselves to a US court's
jurisdiction and judgement.
In accordance with normal UK practice and consistent with Rule 14e-5(b) of the
US Exchange Act, (to the extent applicable) Bidco, certain affiliated
companies and their nominees or brokers (acting as agents) may make certain
purchases of, or arrangements to purchase, shares in Medica outside of the US,
other than pursuant to the Acquisition, until the date on which the
Acquisition and/or Scheme becomes Effective, lapses or is otherwise
withdrawn. If such purchases or arrangements to purchase were to be made
they would occur either in the open market at prevailing prices or in private
transactions at negotiated prices and comply with applicable law, including
the US Exchange Act. Any information about such purchases or arrangements to
purchase will be disclosed as required in the United Kingdom, will be reported
to a Regulatory Information Service and will be available on the London Stock
Exchange website at www.londonstockexchange.com
(http://www.londonstockexchange.com) .
Neither the United States Securities and Exchange Commission nor any US state
securities commission has approved or disapproved the Acquisition, passed upon
the merits or fairness of the Acquisition or passed any opinion upon the
accuracy, adequacy or completeness of this Announcement (nor will it do so in
respect of the Scheme Document). Any representation to the contrary is a
criminal offence in the United States.
Forward looking statements
This Announcement (including information incorporated by reference in this
Announcement), oral statements made regarding the Acquisition, and other
information published by Bidco, IK, Medica, any member of the Wider Bidco
Group or any member of the Wider Medica Group may contain statements which
are, or may be deemed to be, "forward looking statements". Forward looking
statements are prospective in nature and are not based on historical facts,
but rather on current expectations and projections about future events, and
are therefore subject to risks and uncertainties which could cause actual
results to differ materially from the future results expressed or implied by
the forward looking statements.
The forward looking statements contained in this Announcement include
statements relating to the expected effects of the Acquisition on Bidco, IK,
Medica, any member of the Wider Bidco Group or any member of the Wider Medica
Group (including their future prospects, developments and strategies), the
expected timing and scope of the Acquisition and other statements other than
historical facts. Often, but not always, forward looking statements can be
identified by the use of forward looking words such as "prepares", "plans",
"expects" or "does not expect", "is expected", "is subject to", "budget",
"projects", "synergy", "strategy", "scheduled", "goal", "estimates",
"forecasts", "intends", "cost-saving", "intends", "anticipates" or "does not
anticipate", or "believes", or variations of such words and phrases or
statements that certain actions, events or results "may", "could", "should",
"would", "might" or "will" be taken, occur or be achieved. Forward looking
statements may include statements relating to the following: (i) future
capital expenditures, expenses, revenues, earnings, synergies, economic
performance, indebtedness, financial condition, dividend policy, losses and
future prospects; (ii) business and management strategies and the expansion
and growth of Bidco's, IK's, Medica's, any member of the Wider Bidco Group's
or any member of the Wider Medica Group's operations and potential synergies
resulting from the Acquisition; and (iii) the effects of global economic
conditions and governmental regulation on Bidco's, IK's, Medica's, any member
of the Wider Bidco Group's or any member of the Wider Medica Group's business.
Although Bidco and Medica believe that the expectations reflected in such
forward looking statements are reasonable based on information available as at
the date of this Announcement, Bidco, IK, Medica, the Wider Bidco Group and
the Wider Medica Group can give no assurance that such expectations will prove
to be correct. By their nature, forward looking statements involve risk and
uncertainty because they relate to events and depend on circumstances that
will occur in the future. There are a number of factors that could cause
actual results and developments to differ materially from those expressed or
implied by such forward looking statements.
These factors include, but are not limited to: the ability to complete the
Acquisition; the ability to obtain requisite regulatory and shareholder
approvals and the satisfaction of other Conditions; changes in the global
political, economic, business and competitive environments and in market and
regulatory forces; changes in future exchange and interest rates; changes in
tax rates; future business combinations or disposals; changes in general
economic and business conditions; changes in the behaviour of other market
participants; the anticipated benefits from the proposed transaction not being
realised as a result of changes in general economic and market conditions in
the countries in which Bidco, IK, Medica, the Wider Bidco Group and/or the
Wider Medica Group operate; weak, volatile or illiquid capital and/or credit
markets; changes in the degree of competition in the geographic and business
areas in which Bidco, IK, Medica, the Wider Bidco Group and/or the Wider
Medica Group operate; and changes in laws or in supervisory expectations or
requirements. Other unknown or unpredictable factors could cause actual
results to differ materially from those expected, estimated or projected in
the forward looking statements. If any one or more of these risks or
uncertainties materialises or if any one or more of the assumptions proves
incorrect, actual results may differ materially from those expected, estimated
or projected. Such forward looking statements should therefore be construed in
the light of such factors.
Neither Bidco, IK, Medica, the Wider Bidco Group nor the Wider Medica Group,
nor any of their respective associates or directors, officers or advisers,
provide any representation, assurance or guarantee that the occurrence of the
events expressed or implied in any forward looking statements in this
Announcement will actually occur. Given these risks and uncertainties,
potential investors are cautioned not to place any reliance on these forward
looking statements.
Specifically, statements of estimated cost savings and synergies relate to
future actions and circumstances which, by their nature, involve risks,
uncertainties and contingencies. As a result, the cost savings and synergies
referred to may not be achieved, may be achieved later or sooner than
estimated, or those achieved could be materially different from those
estimated.
The forward looking statements speak only at the date of this Announcement.
All subsequent oral or written forward looking statements attributable to any
member of the Wider Bidco Group or the Wider Medica Group, or any of their
respective associates, directors, officers, employees or advisers, are
expressly qualified in their entirety by the cautionary statement above.
Other than in accordance with their legal or regulatory obligations, neither
Bidco, IK, Medica, the Wider Bidco Group nor the Wider Medica Group is under
any obligation to, and each such person expressly disclaims any intention or
obligation to, update or revise any forward looking statements, whether as a
result of new information, future events or otherwise.
No profit forecasts, estimates or qualified benefits statements
Other than the Medica Profit Forecasts, no statement in this Announcement, or
incorporated by reference in this Announcement, is intended as a profit
forecast, profit estimate or quantified benefits statement for any period and
no statement in this Announcement should be interpreted to mean that earnings
or earnings per share for Medica for the current or future financial years
would necessarily match or exceed the historical published earnings or
earnings per share for Medica.
Rounding
Certain figures included in this Announcement have been subjected to rounding
adjustments. Accordingly, figures shown for the same category presented in
different tables may vary slightly and figures shown as totals in certain
tables may not be an arithmetic aggregation of the figures that precede them.
Publication on website
A copy of this Announcement and the documents required to be published
pursuant to Rule 26.1 of the Takeover Code will be available, free of charge,
subject to certain restrictions relating to persons resident in Restricted
Jurisdictions, on Medica's website at www.medicagroupplc.com/offer and Bidco's
website at https://moonlight-offer.com/ by no later than 12.00 p.m. on the
Business Day following this Announcement. For the avoidance of doubt,
neither the content of Medica's website and Bidco's website is incorporated
into, or forms part of, this Announcement.
Information relating to Medica Shareholders
Please be aware that addresses, electronic addresses and certain information
provided by Medica Shareholders, persons with information rights, participants
in the Medica Share Plans and other relevant persons for the receipt of
communications from Medica may be provided to Bidco and IK during the Offer
Period as required under Section 4 of Appendix 4 of the Takeover Code to
comply with Rule 2.11(c) of the Takeover Code.
Right to receive documents in hard copy form
Any person entitled to receive a copy of documents, announcements and
information relating to the Acquisition is entitled to receive such documents
in hard copy form free of charge. For persons who receive a copy of this
Announcement in electronic form or via a website notification, a hard copy of
this Announcement will not be sent unless so requested. A person may request
that all future documents, announcements and information in relation to the
Acquisition are sent to them in hard copy form.
In accordance with Rule 30.3 of the Takeover Code, Medica Shareholders,
persons with information rights and participants in the Medica Share Plans may
request a hard copy of this Announcement by contacting Link Group, Medica's
Registrars on +44(0) 371 664 0391. Calls are charged at the standard
geographic rate and will vary by provider. Calls outside the United Kingdom
will be charged at the applicable international rate. The Shareholder Helpline
is open between 9.00 a.m. and 5.30 p.m., Monday to Friday (excluding public
holidays in England and Wales). Different charges may apply to calls from
mobile telephones and calls may be recorded and randomly monitored for
security and training purposes.
Please note the Shareholder Helpline cannot provide advice on the merits of
the Acquisition or the Scheme nor give any financial, investment, legal or tax
advice.
Disclosure requirements of the Takeover Code
Under Rule 8.3(a) of the Takeover Code, any person who is interested in 1 per
cent. 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 p.m. (London time) on the 10th business day
following the commencement of the offer period and, if appropriate, by no
later than 3.30 p.m. (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 Takeover Code, any person who is, or becomes,
interested in 1 per cent. 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 p.m. (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.
General
Bidco reserves the right to elect, with the consent of the Panel, and subject
to the terms of Co-operation Agreement, to implement the Acquisition by way of
a Takeover Offer as an alternative to the Scheme. In such an event, the
Takeover Offer will be implemented on the same terms or, if Bidco so decides,
on such other terms being no less favourable (subject to appropriate
amendments), so far as applicable, as those which would apply to the Scheme
and subject to the amendment referred to in Appendix 1 to this Announcement.
Upon sufficient acceptances being received in respect of such Takeover Offer,
Bidco intends to exercise its rights to apply the provisions of Chapter 3 of
Part 28 of the Companies Act so as to acquire compulsorily the remaining
Medica Shares in respect of which the Takeover Offer has not been accepted.
Investors should be aware that Bidco may purchase Medica Shares otherwise than
under any Takeover Offer or the Scheme, including pursuant to privately
negotiated purchases.
If you are in any doubt about the contents of this Announcement or the action
you should take, you are recommended to seek your own independent financial
advice immediately from your stockbroker, bank manager, solicitor or
independent financial adviser duly authorised under FSMA if you are resident
in the United Kingdom or, if not, from another appropriate authorised
independent financial adviser.
Rule 2.9
For the purposes of Rule 2.9 of the Takeover Code, Medica confirms that, as at
the date of this Announcement, it had in issue 122,633,635 ordinary shares of
0.2p each. Medica holds no shares in treasury. The International Securities
Identification Number (ISIN) number of the ordinary shares is GB00BYV24996.
NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN WHOLE OR IN PART, IN, INTO OR
FROM ANY JURISDICTION WHERE TO DO SO WOULD CONSTITUTE A VIOLATION OF THE
RELEVANT LAWS OF THAT JURISDICTION
This announcement contains inside information
FOR IMMEDIATE RELEASE
24 April 2023
RECOMMENDED CASH ACQUISITION
OF
Medica group PLC
BY
MOONLIGHT BIDCO LIMITED
a newly incorporated wholly-owned subsidiary of funds advised by
IK INVESTMENT PARTNERS LIMITED
to be implemented by means of a Scheme of Arrangement
under Part 26 of the Companies Act 2006
1. Introduction
The boards of Moonlight Bidco Limited ("Bidco") and Medica Group plc
("Medica") are pleased to announce that they have reached agreement on the
terms and conditions of a recommended all cash offer by Bidco for the entire
issued and to be issued ordinary share capital of Medica (the
"Acquisition"). The Acquisition is intended to be implemented by means of a
scheme of arrangement under Part 26 of the Companies Act.
2. The Acquisition
Under the terms of the Acquisition, which will be subject to the Conditions
and further terms set out in Appendix 1 to this Announcement and the full
terms and conditions to be set out in the Scheme Document, each Medica
Shareholder will be entitled to receive:
for each Medica Share: 212 pence in cash
The Acquisition values the entire issued, and to be issued, ordinary share
capital of Medica at approximately £269 million.
The price per Medica Share represents a premium of approximately:
· 32.5 per cent. to the Closing Price of 160.0 pence
per Medica Share on 21 April 2023 (being the last Business Day before the date
of the commencement of the Offer Period);
· 32.4 per cent. to the volume-weighted average price
of 160.1 pence per Medica Share for the three-month period ended 21 April
2023; and
· 50.0 per cent. to the volume-weighted average price
of 141.3 pence per Medica Share for the six-month period ended 21 April 2023.
The Acquisition implies an enterprise value multiple of Medica's underlying
EBITDA for FY2022 of 16.6x.
If, prior to the Effective Date, the 2022 Final Dividend is authorised by
Medica Shareholders at Medica's 2023 annual general meeting, the Consideration
will be reduced by the full amount of such dividend and the relevant eligible
Medica Shareholders will be entitled to receive and retain such dividend, and
any reference in this Announcement to the Consideration will be deemed to be a
reference to the Consideration as so reduced.
If the Effective Date occurs prior to the 2022 Final Dividend being declared
by Medica Shareholders at Medica's 2023 annual general meeting, there will be
no Final Dividend and no equivalent payment will be made to Medica
Shareholders by Bidco.
If any other dividend, distribution and/or return of value is proposed,
authorised, declared, made or paid or becomes payable in respect of Medica
Shares on or after the date of this Announcement and before the Effective
Date, Bidco reserves the right to reduce the Consideration by the amount of
any such other dividend, distribution and/or other return of value. If Bidco
exercises its right to reduce the Consideration by all or part of the amount
of any other dividend, other distribution and/or other return of value, the
relevant eligible Medica Shareholders will be entitled to receive and retain
such other dividend, distribution and/or other return of value, and any
reference in this Announcement to the Consideration will be deemed to be a
reference to the Consideration as so reduced.
Any exercise by Bidco of its rights referred to in the above paragraph shall
be the subject of an announcement and, for the avoidance of doubt, shall not
be regarded as constituting any revision or variation of the terms of the
Scheme. If and to the extent that any such dividend, distribution and/or
other return of value has been declared or announced but not paid or made or
is not payable in respect of the Medica Shares prior to the Effective Date or
by reference to a record date prior to the Effective Date or such dividend,
distribution and/or other return of value is: (i) transferred pursuant to the
Acquisition on a basis which entitles Bidco to receive the dividend, other
distribution and/or other return of value and to retain it or; (ii) cancelled
before payment, the Consideration shall not be subject to change in accordance
with the above paragraph.
It is intended that the Acquisition will be implemented by means of a
Court-sanctioned scheme of arrangement under Part 26 of the Companies Act
(although Bidco reserves the right to effect the Acquisition by way of a
Takeover Offer, subject to the consent of the Panel and the terms of the
Co-operation Agreement).
It is expected that the Scheme Document, containing further information about
the Acquisition and notices of the Court Meeting and the General Meeting,
together with the associated forms of proxy, will be posted to Medica
Shareholders within 28 days of this Announcement (or such later time as
Medica, Bidco and the Panel agree) and the Meetings are expected to be held
shortly thereafter.
The Scheme will also need to be sanctioned by the Court. Finally, a copy of
the Court Order must be delivered to the Registrar of Companies for
registration, upon which the Scheme will become Effective.
The Acquisition is currently expected to become Effective around the end of Q2
2023, subject to the satisfaction (or, where applicable, waiver) of the
Conditions and further terms set out in Appendix 1 to this Announcement. An
expected timetable of key events relating to the Acquisition will be provided
in the Scheme Document.
The Medica Shares will be acquired fully paid and free from all liens,
charges, equitable interests, encumbrances and rights of pre-emption and any
other interests of any nature whatsoever and together with all rights
attaching thereto.
3. Information on Bidco, IK and IK Partners
Bidco
Bidco is a private company limited by shares registered in England and Wales
and incorporated on 14 April 2023 with company number 14801401. Bidco was
formed for the purposes of the Acquisition and has not traded since its date
of incorporation, nor has it entered into any obligations other than in
connection with the Acquisition.
Bidco is indirectly owned by funds advised by IK.
IK and IK Partners
Since its inception in 1989, IK Partners has initiated, structured, and
financed over 170 private equity transactions across Europe, completed over
400 add-on acquisitions, and raised c. EUR 14 billion of capital. IK Partners
continues to be one of Europe's most active private equity firms, having made
33 platform investments since January 2021. IK Partners has 7 offices across
Europe, as well as an office in the USA, with over 185 employees across the
group. IK Partners seeks to provide support to its portfolio companies to
accelerate growth.
IK Partners has a well-established track record of investing in successful
companies across the Healthcare sector. To date, IK Partners has invested in
23 healthcare companies across Europe, for which it has deployed approximately
EUR 2.1 billion of capital.
The Acquisition will be funded from IK Partners' EUR 2.85 billion Mid Cap
fund, closed in 2020. This vehicle is well-positioned to support Medica, with
capacity to meet follow-on capital needs for accretive M&A.
4. Background to and reasons for the Acquisition
Bidco considers Medica to be a high-quality business that is a leader in the
global teleradiology and wider imaging diagnostics sector, playing an
important role in providing high-quality diagnostic information and reports
for its customers. Bidco has a high degree of respect for the management team
of Medica and the strategy they have implemented and believes that Medica
represents a compelling investment opportunity to acquire a leading player in
the global teleradiology and wider imaging diagnostics marketplace. Medica has
a long-standing reputation for superior quality of teleradiology reporting, a
compelling and differentiated proposition for radiologists, strong customer
advocacy and consistent reliability of the services that it offers.
Over the past few years, Medica has begun to diversify and internationalise
the range of services that it offers. Bidco believes that Medica is better
able to achieve its full potential in a private market setting enabled by the
acceleration of investment in growth. Underpinned by best-in-class clinical
governance, a strong focus on customer service and quality, coupled with
further investment in its technology platform, Bidco considers that as a
private company Medica will be better able to:
· contribute as a key partner for its teleradiology
customers to help them meet the challenges they face due to the significant
demand and backlog for diagnostic imaging against the backdrop of a structural
shortage of radiologists;
· accelerate, both organically and through M&A,
growth in specialist imaging services to the Contract Research sector
globally; and
· accelerate the opportunity for growth within
digital telepathology and broader telemedicine services for existing and new
customers.
5. Information on Medica
Medica is an international provider of high-quality telemedicine services and
a market leading teleradiology provider in the UK and Ireland. In the UK and
Ireland, Medica provides outsourced interpretation and reporting of acute and
non-acute MRI (magnetic resonance imaging), CT (computerised tomography),
ultrasound and plain film (x-ray) images to more than 100 NHS Trusts in the
UK, the Irish HSE, private hospitals and insurance groups, as well as
diagnostic imaging companies. Medica also manages diabetic retinopathy
screening on behalf of the National Screening Service in Ireland.
Through its subsidiary in the United States, RadMD, Medica provides
pharmaceutical and biotech clients and contract research organisations (CROs)
with high quality imaging services for clinical trials. RadMD has contributed
to over 500 international clinical trials, in all phases of clinical research
from proof of concept to phase III and has specific expertise in oncology, as
well as a wider range of therapeutic areas.
Founded in 2004, Medica is listed on the Premium Segment of the Official List
and was admitted to trading on the Main Market of the London Stock Exchange in
2017. Medica is headquartered in Hastings, United Kingdom and currently
employs over 400 people globally with operations in the United Kingdom,
Ireland, the United States of America and Australia.
6. Background to and reasons for the
recommendation
Since its founding in 2004, Medica has successfully grown to become a leading
provider of teleradiology services in the UK providing remote radiology
reporting to more than 100 NHS Trusts. Medica's acute reporting service,
Nighthawk, and non-acute reporting service, Elective, provide healthcare
providers with essential capacity to interpret and report MRI, CT and plain
film X-ray images to swiftly, reliably and accurately diagnose patients.
Today, Medica is supported by a network of over 750 radiologists,
radiographers and specialist doctors across its main business lines of
teleradiology reporting and clinical trial image reporting. Medica prides
itself on offering a wide range of radiologist sub-specialties available 24/7
to support clients for acute and non-acute reporting, which are supported by a
market-leading clinical governance framework. Technology is also central to
Medica's operations and, in 2020, Medica launched its "FutureTech" program
focused on enhancing the reporting experience for radiologists as well as
improving clinical quality and productivity gains to increase radiologist
capacity. In February 2022, Medica successfully completed the first phase of
FutureTech through the successful implementation of a new Picture Archive and
Communication System (PACS). Investment has commenced in the second phase of
the FutureTech program to optimise workflows to further improve radiologist
productivity and increase reporting capacity. In 2023, Medica also launched
the first phase of RadMD's proprietary reader platform.
Under the leadership of the existing management team, Medica has successfully
developed and diversified its range of services into new markets through
acquisitions and partnerships. In November 2020, Medica acquired Global
Diagnostics Ireland Ltd which provides radiology scanning and reporting to the
Irish Health Service Executive (HSE), private hospitals and insurance groups,
as well as diagnostic imaging companies. Whilst expanding Medica's geographic
reach, the acquisition also added a new service area of ophthalmology
screening. In March 2021, Medica acquired RadMD LLC, a US-based imaging
contract research organisation (iCRO), marking Medica's first investment in
the US and accessing a new adjacent growth market providing radiology focused
medical imaging services for clinical trials serving pharmaceutical and
biotech companies, as well as larger CROs. In early 2023, Medica completed two
further small acquisitions of JCA Seminars Ltd, a UK-based international
radiologist training provider to complement the existing UK business, and
VoxelMetrix LLC, a US acquisition to increase radiologist reader capacity and
medical expertise for RadMD to support its growth ambitions. In February
2021, Medica also established MedX, a 50:50 joint venture with Integral
Diagnostics Pty to jointly focus on international teleradiology opportunities.
MedX recently won its first international teleradiology contract and is
focused on further opportunities which will provide geographic diversification
outside of Medica's existing core markets. M&A and partnership remains an
important element of Medica's strategy to add scale and diversity to its
existing business.
The Board also recognises that Medica operates in an increasingly competitive
environment. To remain at the forefront of its industry, Medica will need to
continue to invest in its people, technology and processes. Furthermore,
Medica's inorganic strategy is also an important part of growing and
diversifying the company for the future, including adding scale and capability
to Medica's recently acquired US iCRO business. Medica's current size makes it
challenging to effectively compete for and fund acquisition targets of scale
so Medica is therefore restricted to smaller bolt-on acquisitions which
impacts the pace at which the business can diversify and grow.
Medica has a clear strategy to continue to deliver growth through sustained
teleradiology market leadership in the UK and Ireland, diversification into
adjacent areas of telemedicine including telepathology, teleophthalmology and
by the expansion of RadMD. Under Bidco's ownership in a private environment,
with access to larger and more flexible capital sources, the Board of Medica
believes Medica will be able to accelerate its organic investment strategy in
core areas of telemedicine, technology and radiologist recruitment at a rate
that would not be possible if Medica was to remain publicly listed. The Board
of Medica believes this accelerated investment, particularly in technology to
develop a next generation radiology reporting platform, will benefit
healthcare providers and patients, as Medica will have additional capacity to
report on a larger number of exams which will assist in alleviating the
ever-increasing strain on hospitals which have significant and increasing
waiting lists and scanning and reporting backlogs that remain following the
Covid-19 pandemic. The Board also believes that Medica will be better
positioned to take advantage of a fast-changing market and to take a more
flexible approach to expansion opportunities for the business.
Furthermore, the Board of Medica believes access to private capital and IK
Partners' expertise will enable Medica to increase the speed and size of its
buy-and-build M&A strategy, to deliver scale to RadMD, as well as faster
penetration of new and existing telemedicine services in existing and new
markets worldwide, which would be more constrained if Medica was to remain a
listed entity.
Reasons for the recommendation
Following careful consideration, the Directors of Medica have concluded that
the terms of the Acquisition reflect the strength of Medica's business, team
and its prospects, whilst providing shareholders the opportunity to realise
the value of their holdings today in cash in full at a meaningful premium to
recent trading and at a value that reflects the future growth potential of the
business.
The Directors of Medica have taken all relevant factors into account in
considering the terms of the Acquisition, including:
· the opportunity for Medica Shareholders to realise a fair and
reasonable value for their holdings in cash;
· that the terms of the Acquisition represent a meaningful premium of
approximately:
· 32.5 per cent. to Medica's closing share price of 160.0 pence on 21
April 2023 (being the last Business Day before the commencement of the offer
period);
· 32.4 per cent. to the volume weighted average Medica share price of
160.1 pence over the three-month period ending on 21 April 2023; and
· 50.0 per cent. to the volume weighted average Medica share price of
141.3 pence over the six-month period ending on 21 April 2023;
· the offer price of 212 pence per Medica share was last achieved by the
Company in regular trading on the Main Market in December 2017;
· the Acquisition implies an enterprise value multiple of Medica's
underlying EBITDA for FY2022 of 16.6x; and
· the certainty of the Consideration should be weighed against the
operational risks associated with the delivery of future potential value in
the business in the context of the uncertainty and volatility in the broader
macroeconomic environment.
In addition, the Medica Directors are pleased to note Bidco's stated
intentions concerning Medica's strategy, growth plans, management and
employees, and other stakeholders of Medica. In particular, the Medica
Directors are pleased that Bidco recognises the quality of Medica's management
team, employees and reporters who have performed exceptionally during a period
of unprecedented challenge within global healthcare markets caused by the
Covid-19 pandemic. The Medica Directors also welcome Bidco's confirmation
that, following completion of the Acquisition, the existing employment rights,
including pension rights, of the management and employees of Medica will be
fully safeguarded.
Therefore, having taken into account all relevant factors, including those set
out above as well as discussions which were held with strategic and financial
parties following unsolicited inbound interest, the Medica Directors intend to
recommend unanimously to Shareholders the Acquisition of Medica by Bidco.
7. Recommendation
The Medica Directors, who have been so advised by Evercore as to the financial
terms of the Acquisition, consider the terms of the Acquisition to be fair and
reasonable. In providing its advice, Evercore has taken into account the
commercial assessments of the Medica Directors. Evercore is providing
independent financial advice to the Medica Directors for the purposes of Rule
3 of the Takeover Code.
Accordingly, the Medica Directors confirm that they intend to recommend
unanimously that Medica Shareholders vote or procure votes to approve the
Scheme at the Court Meeting and to vote or procure votes in favour of the
Resolutions to be proposed at the General Meeting, as they have irrevocably
undertaken to do (or procure to be done) in respect of their own holdings over
which they have control, being, in aggregate, 211,411 Medica Shares
representing approximately 0.2 per cent. of the ordinary share capital of
Medica in issue as at the Latest Practicable Date.
8. Irrevocable undertakings
As described in paragraph 7 above, Bidco has received irrevocable undertakings
to vote (or, where applicable, procure voting) in favour of the Scheme at the
Court Meeting and the Resolutions to be proposed at the General Meeting (or,
in the event that the Acquisition is implemented by a Takeover Offer, to
accept or procure acceptance of such Takeover Offer) from all of the Medica
Directors who hold Medica Shares, in respect of their own legal and/or
beneficial holdings which are under their control, totalling 211,411 Medica
Shares (representing approximately 0.2 per cent. of the existing issued
ordinary share capital of Medica as at the Latest Practicable Date), as well
as any further Medica Shares of which they may become the legal or beneficial
holder (whether as a result of the exercise of options or vesting of awards
under the Medica Share Plans or otherwise). All of the Medica Directors
support the Acquisition, as set out in paragraph 7 above.
The undertakings from Medica Directors will cease to be binding if:
· the Scheme Document is not sent to Medica
Shareholders within 28 days (or such longer period as Medica and Bidco agree,
and the Panel consent);
· where Bidco has elected (in accordance with and
subject to the terms of the Co-operation Agreement and with Panel consent) to
proceed with the implementation of the Acquisition by way of a Takeover Offer
and the Offer Document is not sent to Medica Shareholders within 28 days;
· Bidco announces, with consent of the Panel, that it
does not intend to make or proceed with the Acquisition and no new, revised or
replacement Takeover Offer or Scheme is announced by Bidco in accordance with
Rule 2.7 of the Takeover Code at the same time;
· the Scheme (or Takeover Offer, as applicable)
lapses or is withdrawn in accordance with its terms and no new, revised or
replacement Takeover Offer or Scheme is announced by Bidco by such time;
· the Acquisition has not become effective or, in the
event Bidco has elected (in accordance with and subject to the terms of the
Co-operation Agreement and with Panel consent) to proceed with the
implementation of the Acquisition by way of a Takeover Offer, the Takeover
Offer has not become unconditional, in each case by the Long Stop Date; or
· the date on which any competing offer for the
entire issued and to be issued share capital of Medica is declared
unconditional (if implemented by way of a takeover offer) or, if proceeding by
way of a scheme of arrangement, becomes effective.
These undertakings will remain binding in the event that a higher competing
offer for Medica is made.
In addition to the irrevocable undertakings given by the Medica Directors,
certain Medica Shareholders have given irrevocable undertakings to vote in
favour of the Scheme at the Court Meeting and the Resolutions to be proposed
at the General Meeting (or, in the event that the Acquisition is implemented
by a Takeover Offer, to accept or procure acceptance of such Takeover Offer),
in each case in respect of their own legal and/or beneficial holdings (or
those Medica Shares over which they have control) of Medica Shares, totalling
24,356,663 Medica Shares (representing approximately 19.9 per cent. of the
existing issued ordinary share capital of Medica as at the Latest Practicable
Date) as well as any further Medica Shares of which they may become the legal
and/or beneficial holder.
Bidco has therefore received irrevocable undertakings in respect of a total of
24,568,074 Medica Shares representing, in aggregate, approximately 20.0 per
cent. of Medica's share capital in issue as at the Latest Practicable Date.
Further details of these irrevocable undertakings, including the circumstances
in which they cease to be binding, are set out in Appendix 3 to this
Announcement.
9. Directors, management, employees, pensions,
research and development and locations
Strategic plans for the Medica Group
Bidco believes Medica is a high-quality business with exciting growth and
development prospects and represents a compelling investment opportunity to
acquire a leading player in the global teleradiology and wider imaging
diagnostics marketplace with well-established and reputable, international
businesses. Bidco intends to be a strong champion and supporter of Medica,
its business model and strategy which includes support for its continued
growth journey enabling an expansion of radiologist, radiographer and
specialist doctor capacity to address patient needs through further investment
in technology, all underpinned by the highest standards of clinical
governance.
Operating under private ownership will allow Medica's management to fully
focus on executing their long-term strategic vision, with appropriate support,
capital and assistance from a partner with significant operational experience,
sector expertise and resources - whilst maintaining the culture and values of
the business which have been integral in Medica's success to date.
Bidco believes that it is well-positioned to help accelerate Medica's growth
and performance, as a trusted partner to providers of healthcare and clinical
health services in the UK, US and Ireland, where it can continue to play an
important role in delivering critical services that help address the long term
imbalance of significant excess demand for medical imaging and a shortage in
supply of skilled radiologists and radiographers, as well as an enabler of
important clinical trials helping develop leading edge medical advances and
creating greater employment opportunities over the long term. Bidco believes
that Medica's focus on best-in-class clinical governance and dedication to
improving the quality of diagnostic information will ensure it continues to be
well positioned as a leading provider of telemedicine services going forward.
Bidco intends to evaluate further attractive opportunities to make value
enhancing acquisitions to expand the overall size and scale of Medica's
service offering and intends to support Medica's management in identifying,
assessing and financing the acquisitions of complementary companies, as well
as accelerating investment in organic growth opportunities.
Intentions for employees and management
It is clear to Bidco that the Chief Executive Officer and wider management
team of Medica have been instrumental in improving the range and quality of
Medica's service offerings, enhancing Medica's strategic positioning, both
organically and through a number of acquisitions and investing in developing
next-generation technologies, as well as managing Medica through an
unprecedented and extremely challenging period during the Covid-19 pandemic.
Bidco believes that supporting the employee base will be essential to the
continued success of Medica. In addition to investment in the development of
Medica's technology and operational infrastructure, Bidco intends to support
Medica management's growth plans and the expansion of Medica's operations and
service offerings through continued investment in the training, development
and expansion of Medica's international employee base.
Bidco has not entered into, and has not discussed, any form of incentivisation
arrangements with members of the Medica management team or other employees,
but intends to put in place appropriate incentive arrangements for Medica
management and employees following the Effective Date.
As a result of the Medica Shares ceasing to be admitted to trading on the Main
Market, and of Medica becoming a private company, certain corporate and
support functions will no longer be required or may be reduced in size. Bidco
intends to implement only limited headcount reduction as a result of the
Acquisition and confirms that, following completion of the Acquisition, the
existing contractual and statutory rights and terms and conditions of
employment, including pension obligations, of the management and employees of
Medica will be safeguarded in accordance with applicable law. Any individuals
affected will be treated in a manner consistent with the high standards,
culture and practices of Medica. It is expected that each of the non-executive
Medica Directors will resign from their office as a director of Medica on or
shortly after the Effective Date.
Existing rights and pension schemes
Bidco has no intention to make any material change to the existing employment
rights of management or employees of Medica, including in relation to
pensions, and does not envisage any material change in the conditions of
employment of management or employees of Medica or in the balance of their
skills and functions, unless otherwise agreed with the relevant employees.
Intentions for headquarters, locations, fixed assets and research &
development
Bidco does not envisage a redeployment of Medica's fixed asset base.
Following completion of the Acquisition, Bidco may identify areas of the
Medica business where investment can be increased. However, based on
diligence performed to date, Bidco does not expect the Acquisition to have a
material impact on the operations, places of business, or headquarters of
Medica, nor its research and development functions.
Trading Facilities
Medica is currently listed on the Official List and it is intended that a
request shall be made to the London Stock Exchange to cancel trading in Medica
Shares and the Financial Conduct Authority to cancel the listing of the Medica
Shares from the Official List and re-register it as a private company.
Statements
None of the statements in this paragraph 9 is a "post-offer undertaking" for
the purposes of Rule 19.5 of the Takeover Code.
10. Financing of the Acquisition
The cash consideration payable by Bidco pursuant to the Acquisition will be
funded through a combination of:
· equity investment into Bidco from the IK Funds; and
· new debt financing to be provided under a facility
agreement made available to Bidco by the Lenders.
Jefferies, in its capacity as the financial adviser to Bidco and IK, is
satisfied that sufficient resources are available to Bidco to enable it to
satisfy in full the cash consideration payable to Scheme Shareholders under
the terms of the Acquisition.
Further information on the financing of the Acquisition will be set out in the
Scheme Document.
11. Medica Share Plans
Participants in the Medica Share Plans will be contacted regarding the effect
of the Acquisition on their rights under the Medica Share Plans and an
appropriate proposal will be made to such participants in due course in
accordance with the provisions of Rule 15 of the Takeover Code (as
applicable), and such proposal will reflect their rights under the Medica
Share Plans.
Details of the impact of the Scheme on each of the Medica Share Plans and the
offer will be set out in the Scheme Document.
12. Offer-related arrangements
Confidentiality Agreement
On 28 February 2023, IK and Medica entered into a confidentiality agreement in
relation to the Acquisition (the "Confidentiality Agreement"), pursuant to
which, amongst other things, IK gave certain undertakings to keep, and to
procure that certain of its representatives keep, confidential information
relating to the Wider Medica Group and/or the Acquisition confidential, to use
such information solely for the agreed purpose in relation to the Acquisition
and not to disclose it to third parties (subject to certain exceptions).
These confidentiality obligations will remain in force until 28 February 2025.
The Confidentiality Agreement also contains undertakings from IK that: (i) it
shall not, and shall procure that its representatives shall not, in connection
with the Acquisition, approach certain of Medica's employees, officers and
other key stakeholders without the prior written consent of Medica and (ii)
for a period of 12 months from the date on which negotiations cease in respect
of the Acquisition, it shall not, and shall procure that its representatives
shall not, solicit or offer to employ or engage and person who at any time
during the course of negotiations is working for the Wider Medica Group
(whether as an employee, consultant or independent contractor) in an executive
or managerial capacity or who otherwise has access to trade secrets or other
confidential information belonging to the Wider Medica Group or who is
involved in negotiations relating to the Acquisition.
IK has also agreed to customary standstill arrangements pursuant to which IK
has agreed that, without the prior written consent of Medica, IK will not, and
will procure that its affiliates will not, amongst other things, acquire
Medica Shares or any interest in Medica Shares for a period of 12 months from
the date of the Confidentiality Agreement. These standstill arrangements
fall away immediately following the making of this Announcement.
Co-operation Agreement
On 24 April 2023, Bidco and Medica entered into a co-operation agreement in
relation to the Acquisition (the "Co-operation Agreement"), pursuant to which,
amongst other things: (i) Bidco has agreed to provide Medica with certain
information for the purposes of the Scheme Document and to otherwise assist
with the preparation of the Scheme Document; (ii) Bidco has agreed to certain
provisions if the Scheme should switch to a Takeover Offer and (iii) each of
Medica and Bidco has agreed to take certain actions to implement certain
proposals in relation to the Medica Share Plans.
The Co-operation Agreement will terminate: (a) if agreed in writing between
the parties at any time prior to the Effective Date; (b) upon service of
written notice by Bidco to Medica, if prior to the Long Stop Date, any
Condition has been invoked by Bidco or any Condition which is incapable of
waiver is incapable of satisfaction (in each case, where the invocation of the
relevant Condition or confirmation that the Condition is incapable of
satisfaction, as appropriate has been permitted by the Panel); or (c) upon
service of written notice by either party to the other party, if one or more
of the following occurs: (i) a Competing Proposal (as defined in the
Co-operation Agreement) completes, becomes effective or is declared or becomes
unconditional in all respects; (ii) the Acquisition is withdrawn, terminated
or lapses in accordance with its terms prior to the Long Stop Date and, where
required, with the consent of the Panel (other than: (A) where such lapse or
withdrawal is as a result of the exercise of Bidco's right to effect a Switch
(as defined in the Co-operation Agreement); or (B) it is otherwise to be
followed within five Business Days (or such other period as Medica and Bidco
may agree) by an announcement under Rule 2.7 of the Takeover Code made by
Bidco or any person acting in concert with Bidco (or deemed to be acting in
concert with the Bidco) to implement the Acquisition by a different offer or
scheme); (iii) the Effective Date has not occurred by the Long Stop Date
(unless otherwise agreed by the parties in writing, or required by the Panel);
or (iv) a Medica Board Adverse Recommendation Change (as defined in the
Co-operation Agreement) occurs and a Competing Proposal has not been
announced.
The above summary of the Co-operation Agreement does not purport to be
complete and is subject to, and qualified in its entirety by, the text of the
Co-operation Agreement, which is available for inspection as described in
paragraph 19.
13. Structure of the Acquisition
It is intended that the Acquisition will be implemented by means of a
Court-sanctioned scheme of arrangement between Medica and Scheme Shareholders
under Part 26 of the Companies Act (although Bidco reserves the right to
effect the Acquisition by way of a Takeover Offer, subject to the consent of
the Panel and the terms of the Co-operation Agreement).
The purpose of the Scheme is to provide for Bidco to become the holder of the
entire issued and to be issued ordinary share capital of Medica. This is to
be achieved by the transfer of the Medica Shares (other than any Excluded
Shares) to Bidco, in consideration for which the Medica Shareholders will
receive the cash consideration on the basis set out in paragraph 2 above.
The Acquisition is subject to the Conditions and certain further terms
referred to in Appendix 1 to this Announcement and to the full terms and
conditions to be set out in the Scheme Document, and will only become
Effective if, among other things, the following events occur on or before the
Long Stop Date:
· a resolution to approve the Scheme is passed by a
majority in number of the Scheme Shareholders present and voting (and entitled
to vote) at the Court Meeting, either in person or by proxy, representing at
least 75 per cent. in value of the Scheme Shares voted by those Scheme
Shareholders;
· the Resolutions required to implement the Scheme
being duly passed by Medica Shareholders at the General Meeting representing
at least 75 per cent. of the votes validly cast on such Resolutions, either in
person or by proxy;
· following the Court Meeting and the General
Meeting, the Scheme is sanctioned by the Court (without modification, or with
modification on terms agreed by Bidco and Medica); and
· following such sanction, a copy of the Court Order
is delivered to the Registrar of Companies.
The Scheme will lapse if, amongst other things:
· the Court Meeting and the General Meeting are not
held on or before the ( )22nd day after 9 June 2023, being the expected date
of the Meetings to be set out in the Scheme Document (or such later date as
may be agreed between Bidco and Medica, with the consent of the Panel and, if
required, the Court);
· the Sanction Hearing to approve the Scheme is not
held on or before the 22nd day after the expected date of such hearing, which
will be set out in the Scheme Document (or such later date as may be agreed
between Bidco and Medica, with the consent of the Panel and, if required, the
Court); or
· the Scheme does not become Effective on or before
the Long Stop Date,
provided, however, that the deadlines for the Court Meeting, the General
Meeting and the Sanction Hearing as set out above may be waived by Bidco and
the deadline for the Scheme to become Effective may be extended by agreement
between Medica and Bidco, with the consent of the Panel and, if required, the
Court.
Once the necessary approvals from Medica Shareholders have been obtained and
the other Conditions have been satisfied or (where applicable) waived and the
Scheme has been approved by the Court, the Scheme will become Effective upon
delivery of the Court Order to the Registrar of Companies. Subject to the
satisfaction (or, where applicable, waiver) of the Conditions and the further
terms set out in Appendix 1 to this Announcement, the Scheme is expected to
become Effective around the end of Q2 2023.
Upon the Scheme becoming Effective: (i) it will be binding on all Scheme
Shareholders, irrespective of whether or not they attended or voted at the
Court Meeting or the General Meeting (and if they attended and voted, whether
or not they voted in favour); (ii) entitlements to Medica Shares held within
the CREST system will be cancelled and such entitlements rematerialised; and
(iii) share certificates in respect of Medica Shares will cease to be valid.
The Consideration will be dispatched to Medica Shareholders no later than 14
days after the Effective Date.
Any Medica Shares issued before the Scheme Record Time will be subject to the
terms of the Scheme. The Resolutions to be proposed at the General Meeting
will, amongst other matters, provide that the Medica Articles be amended to
incorporate provisions requiring any Medica Shares issued after the Scheme
Record Time (other than to Bidco and/or its nominees) to be automatically
transferred to Bidco (and, where applicable, for Consideration to be paid to
the original recipient of the Medica Shares so issued) on the same terms as
the Acquisition (other than terms as to timings and formalities). The
provisions of the Articles (as amended) will avoid any person (other than
Bidco and its nominees) holding shares in the capital of Medica after the
Effective Date.
Bidco reserves the right to elect to implement the Acquisition by way of a
Takeover Offer as an alternative to the Scheme (subject to the Panel's consent
and the terms of the Co-operation Agreement). In such event, the Acquisition
will be implemented on the same terms (subject to appropriate amendments
including (without limitation) the inclusion of an acceptance condition which
will be set at 90 per cent. (or such lesser percentage as Bidco may decide
after, to the extent necessary, consultation with the Panel, being in any case
more than 50 per cent. of the voting rights attaching to the Medica Shares) of
the shares to which the Acquisition relates and those required by, or deemed
appropriate by, Bidco under applicable law, so far as applicable) as those
which would apply to the Scheme. Further, if sufficient acceptances of such
Takeover Offer are received and/or sufficient Medica Shares are otherwise
acquired, it will be the intention of Bidco to apply the provisions of the
Companies Act to acquire compulsorily any outstanding Medica Shares to which
such Takeover Offer relates.
Further details of the Scheme, including expected times and dates for each of
the Court Meeting, the General Meeting and the Sanction Hearing, together with
notices of the Meetings, will be set out in the Scheme Document, which,
together with the Forms of Proxy, will be posted to Medica Shareholders within
28 days of this Announcement (or such later time as Medica, Bidco and the
Panel agree) and the Meetings are expected to be held shortly thereafter.
The General Meeting is expected to be held immediately after the Court
Meeting.
The Scheme will be governed by English law and will be subject to the
jurisdiction of the courts of England. The Scheme will be subject to the
applicable requirements of the Takeover Code, the Panel, the London Stock
Exchange, the Listing Rules, the FCA and the Registrar of Companies.
14. Conditions to the Acquisition
The Acquisition will be on the terms and subject to the Conditions set out in
Appendix 1 to this Announcement, and the full terms and conditions will be set
out in the Scheme Document.
15. Cancellation of listing of Medica Shares
Before the Scheme becoming Effective, it is intended that applications will be
made to the London Stock Exchange to cancel trading in Medica Shares on the
Main Market and to the FCA to cancel the listing of the Medica Shares from the
premium segment of the Official List, in each case, with effect from or
shortly following the Effective Date. The last day of dealings in, and
registration of transfers of, Medica Shares on the London Stock Exchange is
expected to be the Business Day immediately prior to the Effective Date.
On the Effective Date, share certificates in respect of Medica Shares will
cease to be valid and entitlements to Medica Shares held within the CREST
system will be cancelled. Medica Shareholders shall be required to return
share certificates to Medica or destroy them following the Effective Date.
It is also proposed that, following the Effective Date and after its shares
are delisted, Medica will be re-registered as a private limited company under
the relevant provisions of the Companies Act.
16. Disclosure of Interests in Medica securities
As at the Latest Practicable Date, save for the irrevocable undertakings
referred to in paragraph 8 above, no member of the Bidco Group nor any of
their directors, nor, so far as Bidco is aware, any person acting in concert
(within the meaning of the Takeover Code) with any of them for the purposes of
the Acquisition had:
· any interest in or right to subscribe for any
relevant securities of Medica;
· any short positions in respect of relevant
securities of Medica (whether conditional or absolute and whether in the money
or otherwise), including any short position under a derivative, any agreement
to sell or any delivery obligation or right to require another person to
purchase or take delivery;
· borrowed or lent any relevant securities of Medica
(including, for these purposes, any financial collateral arrangements of the
kind referred to in Note 4 on Rule 4.6 of the Takeover Code), save for any
borrowed relevant securities of Medica which had been either on-lent or sold;
and/or
· entered into any dealing arrangement of the kind
referred to in Note 11 on the definition of acting in concert in the Takeover
Code.
"interests in securities" for these purposes and within the meaning of the
Takeover Code arise, in summary, when a person has long economic exposure,
whether absolute or conditional, to changes in the price of securities (and a
person who only has a short position in securities is not treated as
interested in those securities). Notwithstanding the above, a person will be
treated as having an 'interest' by virtue of the ownership, voting rights or
control of securities, or by virtue of any agreement to purchase, option in
respect of, or derivative referenced to, securities.
It has not been practicable for Bidco to make enquiries of all of its concert
parties in advance of the release of this Announcement. Therefore, all
relevant details in respect of Bidco's concert parties will be included in its
Opening Position Disclosure in accordance with Rule 8.1(a) and Note 2(a)(i) on
Rule 8 of the Takeover Code.
17. Consents
Each of Jefferies, Evercore, Liberum and Numis has given and not withdrawn its
written consent to the publication of this Announcement with the inclusion of
the references to its name in the form and context in which they appear.
18. General
The Acquisition will be on the terms and subject to the Conditions set out in
Appendix 1 to this Announcement, and the full terms and conditions will be set
out in the Scheme Document. The bases and sources of certain financial
information contained in this Announcement are set out in Appendix 2 to this
Announcement. A summary of the irrevocable undertakings given in relation to
the Acquisition is contained in Appendix 3 to this Announcement. Certain
terms and expressions used in this Announcement are defined in Appendix 4 to
this Announcement.
The Scheme Document and the Forms of Proxy accompanying the Scheme Document
will be sent to Medica Shareholders within 28 days of this Announcement (or on
such later date as may be agreed between Bidco and Medica, with the consent of
the Panel).
This Announcement does not constitute an offer or an invitation to purchase or
subscribe for any securities. Such offer will be contained in the Scheme
Document. Medica Shareholders are advised to read carefully the Scheme
Document and associated Forms of Proxy once they have been dispatched.
The availability of the Acquisition to Medica Shareholders who are not
resident in and citizens of the United Kingdom may be affected by the laws of
the relevant jurisdictions in which they are located or of which they are
citizens. Persons who are not resident in the United Kingdom should inform
themselves of, and observe, any applicable legal or regulatory requirements of
their jurisdictions. Medica Shareholders who are in any doubt regarding such
matters should consult an appropriate independent professional adviser in the
relevant jurisdiction without delay.
19. Documents available on website
Copies of the following documents will be available promptly via a link on
Medica's website at www.medicagroupplc.com/offer and Bidco's website at
https://moonlight-offer.com/, subject to certain restrictions relating to
persons resident in Restricted Jurisdictions, and in any event by no later
than noon on the Business Day following the date of this Announcement until
the end of the Acquisition:
· this Announcement;
· documents relating to Bidco's financing of the
Acquisition;
· the irrevocable undertakings referred to in
paragraph 8 above;
· the Confidentiality Agreement referred to in
paragraph 12 above;
· the Co-operation Agreement referred to in paragraph
12 above; and
· the written consent letter from each of Jefferies,
Evercore, Liberum and Numis as referred to in paragraph 17 above.
The content of the websites referred to in this Announcement is not
incorporated into and does not form part of this Announcement.
Enquiries:
Jefferies +44 (0) 20 7029 8000
(Financial Adviser to Bidco and IK)
James Thomlinson
Ashwin Pai
William Brown
IK +44 (0) 20 7304 7153
(Marketing and Communications Manager) vidya.verlkumar@ikpartners.com
Vidya Verlkumar
H/Advisors Maitland +44 (0) 20 7379 5151
(Public Relations Adviser to Bidco and IK) IK-Maitland@h-advisors.global
Vikki Kosmalska
Finlay Donaldson
Medica +44 (0)33 33 111 222
Stuart Quin, Chief Executive Officer
Richard Jones, Chief Financial Officer
Evercore +44 (0) 20 7653 6000
(Lead Financial Adviser to Medica)
Julian Oakley
Simon Elliott
Harrison George
Liberum +44 (0) 20 3100 2000
(Joint Financial Adviser and Joint Broker to Medica)
Phil Walker
Mark Harrison
Richard Lindley
Numis +44 (0) 20 7260 1000
(Joint Financial Adviser and Joint Broker to Medica)
Freddie Barnfield
Stuart Ord
Duncan Monteith
FTI Consulting +44 (0) 20 3727 1000
(Public Relations Adviser to Medica) medicagroupplc@fticonsulting.com
Ben Atwell
Victoria Foster Mitchell
Sam Purewal
Travers Smith LLP is acting as legal adviser to Bidco and IK.
DLA Piper UK LLP is acting as legal adviser to Medica.
Disclaimers
Jefferies, which is authorised and regulated in the United Kingdom by the FCA,
is acting exclusively as financial adviser to Bidco and IK and for no one else
in connection with the Acquisition and will not be responsible to anyone other
than Bidco and IK for providing the protections afforded to clients of
Jefferies for providing advice in relation to the Acquisition, the contents of
this Announcement or any other matters referred to in this Announcement.
Neither Jefferies 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 Jefferies in connection with this Announcement, any statement
contained herein or otherwise.
Evercore, which is authorised and regulated by the FCA in the UK, is acting
exclusively as financial adviser to Medica and no one else in connection with
the matters described in this Announcement and will not be responsible to
anyone other than Medica for providing the protections afforded to clients of
Evercore nor for providing advice in connection with the matters referred to
herein. Neither Evercore nor any of its subsidiaries, branches or 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 Evercore in connection with this
Announcement, any statement contained herein, any offer or otherwise. Apart
from the responsibilities and liabilities, if any, which may be imposed on
Evercore by FSMA and successor legislation, or the regulatory regime
established thereunder, or under the regulatory regime of any jurisdiction
where exclusion of liability under the relevant regulatory regime would be
illegal, void or unenforceable, neither Evercore nor any of its affiliates
accepts any responsibility or liability whatsoever for the contents of this
Announcement, and no representation, express or implied, is made by it, or
purported to be made on its behalf, in relation to the contents of this
Announcement, including its accuracy, completeness or verification of any
other statement made or purported to be made by it, or on its behalf, in
connection with Medica or the matters described in this Announcement. To the
fullest extent permitted by applicable law, Evercore and its affiliates
accordingly disclaim all and any responsibility or liability whether arising
in tort, contract or otherwise (save as referred to above) which they might
otherwise have in respect of this Announcement or any statement contained
herein.
Liberum Capital Limited ("Liberum"), which is authorised and regulated by the
Financial Conduct Authority in the United Kingdom, is acting exclusively for
Medica and no one else in connection with the Acquisition and will not be
responsible to anyone other than Medica for providing the protections afforded
to clients of Liberum nor for providing advice in relation to the Acquisition
or any other matters referred to in this Announcement. Neither Liberum 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 Liberum in
connection with this Announcement, any statement contained herein or
otherwise.
Numis Securities Limited ("Numis"), which is authorised and regulated by the
FCA in the United Kingdom, is acting exclusively for Medica and for no one
else in connection with the Acquisition and/or any other matter referred to in
this Announcement and will not be responsible to anyone other than Medica for
providing the protections afforded to its clients or for providing advice in
relation to the Acquisition, the contents of this Announcement, or another
other matters referred to in this Announcement. Neither Numis nor any of its
subsidiaries, affiliates or branches owes or accepts any duty, liability or
responsibility whatsoever (whether direct, indirect, consequential, whether in
contract, in tort, under statute or otherwise) to any person who is not a
client of Numis in connection with this Announcement, any statement or other
matter or arrangement referred to herein or otherwise.
Further information
This Announcement is for information purposes only and is not intended to, and
does not, constitute or form part of any offer or inducement to sell or an
invitation to purchase, otherwise acquire, subscribe for, sell or otherwise
dispose of, any securities or a solicitation of an offer to buy any
securities, any vote or approval in any jurisdiction pursuant to the
Acquisition or otherwise, nor shall there be any purchase, sale, issuance or
exchange of securities or such solicitation in any jurisdiction in which such
offer, solicitation, sale issuance or exchange is unlawful. The Acquisition
will be made solely by means of the Scheme Document (or, if the Acquisition is
implemented by way of a Takeover Offer, the Offer Document), which will
contain the full terms and conditions of the Acquisition, including details of
how to vote in respect of the Acquisition. Any decision in respect of, or
other response to, the Acquisition should be made only on the basis of the
information in the Scheme Document (or, if the Acquisition is implemented by
way of a Takeover Offer, the Offer Document).
This Announcement has been prepared in connection with proposals in relation
to a scheme of arrangement pursuant to and for the purpose of complying with
English law, the Listing Rules, the Takeover Code, the Market Abuse Regulation
(EU 596/2014) (which is part of UK law by virtue of the European Union
(Withdrawal) Act 2018) and the Disclosure Guidance and Transparency Rules and
information disclosed may not be the same as that which would have been
disclosed if this Announcement had been prepared in accordance with the laws
of jurisdictions outside England. Nothing in this Announcement should be
relied on for any other purpose.
Medica and Bidco will prepare the Scheme Document (or, if the Acquisition is
implemented by way of a Takeover Offer, the Offer Document) to be distributed
to Medica Shareholders at no cost to them. Medica and Bidco urge Medica
Shareholders to read the Scheme Document when it becomes available because it
will contain important information relating to the Acquisition.
This Announcement is not an advertisement and does not constitute a
prospectus, prospectus equivalent document or an exempted document.
Overseas jurisdictions
The release, publication or distribution of this Announcement in or into
certain jurisdictions other than the United Kingdom may be restricted by law
and therefore any persons into whose possession this Announcement comes should
inform themselves of, and observe, such restrictions. Further details in
relation to the Overseas Shareholders will be contained in the Scheme
Document. Any failure to comply with any such restrictions may constitute a
violation of the securities laws of any such jurisdiction. To the fullest
extent permitted by applicable law, the companies and persons involved in the
Acquisition disclaim any responsibility or liability for the violation of such
restrictions by any person.
Unless otherwise determined by Bidco or required by the Takeover Code, and
permitted by applicable law and regulation, the Acquisition shall not be made
available, directly or indirectly, in, into or from a Restricted Jurisdiction
where to do so would violate the laws in that jurisdiction and no person may
vote in favour of the Scheme by any such means from within a Restricted
Jurisdiction or any other jurisdiction if to do so would constitute a
violation of the laws of that jurisdiction. Accordingly, copies of this
Announcement and all documents relating to the Acquisition are not being, and
must not be, directly or indirectly, mailed or otherwise forwarded,
distributed or sent in, into or from a Restricted Jurisdiction where to do so
would violate the laws in that jurisdiction, and persons receiving this
Announcement and all documents relating to the Acquisition (including
custodians, nominees and trustees) must not mail or otherwise distribute or
send them in, into or from such jurisdictions where to do so would violate the
laws in that jurisdiction.
The Acquisition shall be subject to the applicable requirements of the
Takeover Code, the Panel, the London Stock Exchange, the FCA, the Listing
Rules and the Registrar of Companies.
Additional information for US investors in Medica
Medica Shareholders in the United States should note that the Acquisition
relates to the shares of an English company with a listing on the Main Market
and is proposed to be effected by means of a scheme of arrangement under
English law. This Announcement, the Scheme Document and certain other
documents relating to the Acquisition have been or will be prepared in
accordance with English law, the Takeover Code and UK disclosure requirements,
format and style, all of which differ from those in the United States. A
transaction effected by means of a scheme of arrangement is not subject to the
tender offer rules or the proxy solicitation rules under the US Exchange
Act. Accordingly, the Acquisition is subject to the disclosure requirements
of and practices applicable in the United Kingdom to schemes of arrangement,
which differ from the disclosure requirements of the United States tender
offer and proxy solicitation rules. If, in the future, Bidco exercises the
right to implement the Acquisition by way of a Takeover Offer and determines
to extend the offer into the United States, the Acquisition will be made in
compliance with applicable United States laws and regulations, including any
applicable exemptions under the US Exchange Act.
Medica's financial statements, and all financial information that is included
in this Announcement, the Scheme Document or any other documents relating to
the Acquisition, have been or will be prepared in accordance with UK-adopted
international accounting standards and may not be comparable to financial
statements of companies in the United States or other companies whose
financial statements are prepared in accordance with US generally accepted
accounting principles.
The receipt of cash pursuant to the Acquisition by a US holder as
consideration for the transfer of its Medica Shares pursuant to the Scheme
will likely be a taxable transaction for United States federal income tax
purposes and under applicable United States state and local, as well as
foreign and other, tax laws. Each Medica Shareholder is urged to consult
their independent professional adviser immediately regarding the tax
consequences of the Acquisition applicable to them, including under applicable
United States state and local laws, as well as overseas and other, tax laws.
It may be difficult for US holders to enforce their rights and claims arising
out of the US federal securities laws, since Bidco and Medica are located in
countries other than the US, and some or all of their officers and directors
may be residents of countries other than the US. US holders may not be able
to sue a non-US company or its officers or directors in a non-US court for
violations of US securities laws. Further, it may be difficult to compel a
non-US company and its affiliates to subject themselves to a US court's
jurisdiction and judgement.
In accordance with normal UK practice and consistent with Rule 14e-5(b) of the
US Exchange Act, (to the extent applicable) Bidco, certain affiliated
companies and their nominees or brokers (acting as agents) may make certain
purchases of, or arrangements to purchase, shares in Medica outside of the US,
other than pursuant to the Acquisition, until the date on which the
Acquisition and/or Scheme becomes Effective, lapses or is otherwise
withdrawn. If such purchases or arrangements to purchase were to be made
they would occur either in the open market at prevailing prices or in private
transactions at negotiated prices and comply with applicable law, including
the US Exchange Act. Any information about such purchases or arrangements to
purchase will be disclosed as required in the United Kingdom, will be reported
to a Regulatory Information Service and will be available on the London Stock
Exchange website at www.londonstockexchange.com
(http://www.londonstockexchange.com) .
Neither the United States Securities and Exchange Commission nor any US state
securities commission has approved or disapproved the Acquisition, passed upon
the merits or fairness of the Acquisition or passed any opinion upon the
accuracy, adequacy or completeness of this Announcement (nor will it do so in
respect of the Scheme Document). Any representation to the contrary is a
criminal offence in the United States.
Forward looking statements
This Announcement (including information incorporated by reference in this
Announcement), oral statements made regarding the Acquisition, and other
information published by Bidco, IK, Medica, any member of the Wider Bidco
Group or any member of the Wider Medica Group may contain statements which
are, or may be deemed to be, "forward looking statements". Forward looking
statements are prospective in nature and are not based on historical facts,
but rather on current expectations and projections about future events, and
are therefore subject to risks and uncertainties which could cause actual
results to differ materially from the future results expressed or implied by
the forward looking statements.
The forward looking statements contained in this Announcement include
statements relating to the expected effects of the Acquisition on Bidco, IK,
Medica, any member of the Wider Bidco Group or any member of the Wider Medica
Group (including their future prospects, developments and strategies), the
expected timing and scope of the Acquisition and other statements other than
historical facts. Often, but not always, forward looking statements can be
identified by the use of forward looking words such as "prepares", "plans",
"expects" or "does not expect", "is expected", "is subject to", "budget",
"projects", "synergy", "strategy", "scheduled", "goal", "estimates",
"forecasts", "intends", "cost-saving", "intends", "anticipates" or "does not
anticipate", or "believes", or variations of such words and phrases or
statements that certain actions, events or results "may", "could", "should",
"would", "might" or "will" be taken, occur or be achieved. Forward looking
statements may include statements relating to the following: (i) future
capital expenditures, expenses, revenues, earnings, synergies, economic
performance, indebtedness, financial condition, dividend policy, losses and
future prospects; (ii) business and management strategies and the expansion
and growth of Bidco's, IK's, Medica's, any member of the Wider Bidco Group's
or any member of the Wider Medica Group's operations and potential synergies
resulting from the Acquisition; and (iii) the effects of global economic
conditions and governmental regulation on Bidco's, IK's, Medica's, any member
of the Wider Bidco Group's or any member of the Wider Medica Group's business.
Although Bidco and Medica believe that the expectations reflected in such
forward looking statements are reasonable based on information available as at
the date of this Announcement, Bidco, IK, Medica, the Wider Bidco Group and
the Wider Medica Group can give no assurance that such expectations will prove
to be correct. By their nature, forward looking statements involve risk and
uncertainty because they relate to events and depend on circumstances that
will occur in the future. There are a number of factors that could cause
actual results and developments to differ materially from those expressed or
implied by such forward looking statements.
These factors include, but are not limited to: the ability to complete the
Acquisition; the ability to obtain requisite regulatory and shareholder
approvals and the satisfaction of other Conditions; changes in the global
political, economic, business and competitive environments and in market and
regulatory forces; changes in future exchange and interest rates; changes in
tax rates; future business combinations or disposals; changes in general
economic and business conditions; changes in the behaviour of other market
participants; the anticipated benefits from the proposed transaction not being
realised as a result of changes in general economic and market conditions in
the countries in which Bidco, IK, Medica, the Wider Bidco Group and/or the
Wider Medica Group operate; weak, volatile or illiquid capital and/or credit
markets; changes in the degree of competition in the geographic and business
areas in which Bidco, IK, Medica, the Wider Bidco Group and/or the Wider
Medica Group operate; and changes in laws or in supervisory expectations or
requirements. Other unknown or unpredictable factors could cause actual
results to differ materially from those expected, estimated or projected in
the forward looking statements. If any one or more of these risks or
uncertainties materialises or if any one or more of the assumptions proves
incorrect, actual results may differ materially from those expected, estimated
or projected. Such forward looking statements should therefore be construed in
the light of such factors.
Neither Bidco, IK, Medica, the Wider Bidco Group nor the Wider Medica Group,
nor any of their respective associates or directors, officers or advisers,
provide any representation, assurance or guarantee that the occurrence of the
events expressed or implied in any forward looking statements in this
Announcement will actually occur. Given these risks and uncertainties,
potential investors are cautioned not to place any reliance on these forward
looking statements.
Specifically, statements of estimated cost savings and synergies relate to
future actions and circumstances which, by their nature, involve risks,
uncertainties and contingencies. As a result, the cost savings and synergies
referred to may not be achieved, may be achieved later or sooner than
estimated, or those achieved could be materially different from those
estimated.
The forward looking statements speak only at the date of this Announcement.
All subsequent oral or written forward looking statements attributable to any
member of the Wider Bidco Group or the Wider Medica Group, or any of their
respective associates, directors, officers, employees or advisers, are
expressly qualified in their entirety by the cautionary statement above.
Other than in accordance with their legal or regulatory obligations, neither
Bidco, IK, Medica, the Wider Bidco Group nor the Wider Medica Group is under
any obligation to, and each such person expressly disclaims any intention or
obligation to, update or revise any forward looking statements, whether as a
result of new information, future events or otherwise.
No profit forecasts, estimates or qualified benefits statements
Other than the Medica Profit Forecasts, no statement in this Announcement, or
incorporated by reference in this Announcement, is intended as a profit
forecast, profit estimate or quantified benefits statement for any period and
no statement in this Announcement should be interpreted to mean that earnings
or earnings per share for Medica for the current or future financial years
would necessarily match or exceed the historical published earnings or
earnings per share for Medica.
Rounding
Certain figures included in this Announcement have been subjected to rounding
adjustments. Accordingly, figures shown for the same category presented in
different tables may vary slightly and figures shown as totals in certain
tables may not be an arithmetic aggregation of the figures that precede them.
Publication on website
A copy of this Announcement and the documents required to be published
pursuant to Rule 26.1 of the Takeover Code will be available, free of charge,
subject to certain restrictions relating to persons resident in Restricted
Jurisdictions on Medica's website at www.medicagroupplc.com/offer and Bidco's
website at https://moonlight-offer.com/ by no later than 12.00 p.m. on the
Business Day following this Announcement. For the avoidance of doubt,
neither the content of Medica's website and Bidco's website is incorporated
into, or forms part of, this Announcement.
Information relating to Medica Shareholders
Please be aware that addresses, electronic addresses and certain information
provided by Medica Shareholders, persons with information rights, participants
in the Medica Share Plans and other relevant persons for the receipt of
communications from Medica may be provided to Bidco and IK during the Offer
Period as required under Section 4 of Appendix 4 of the Takeover Code to
comply with Rule 2.11(c) of the Takeover Code.
Right to receive documents in hard copy form
Any person entitled to receive a copy of documents, announcements and
information relating to the Acquisition is entitled to receive such documents
in hard copy form free of charge. For persons who receive a copy of this
Announcement in electronic form or via a website notification, a hard copy of
this Announcement will not be sent unless so requested. A person may request
that all future documents, announcements and information in relation to the
Acquisition are sent to them in hard copy form.
In accordance with Rule 30.3 of the Takeover Code, Medica Shareholders,
persons with information rights and participants in the Medica Share Plans may
request a hard copy of this Announcement by contacting Link Group, Medica's
Registrars on +44(0) 371 664 0391. Calls are charged at the standard
geographic rate and will vary by provider. Calls outside the United Kingdom
will be charged at the applicable international rate. The Shareholder Helpline
is open between 9.00 a.m. and 5.30 p.m., Monday to Friday (excluding public
holidays in England and Wales). Different charges may apply to calls from
mobile telephones and calls may be recorded and randomly monitored for
security and training purposes.
Please note the Shareholder Helpline cannot provide advice on the merits of
the Acquisition or the Scheme nor give any financial, investment, legal or tax
advice.
Disclosure requirements of the Takeover Code
Under Rule 8.3(a) of the Takeover Code, any person who is interested in 1 per
cent. 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 p.m. (London time) on the 10th business day
following the commencement of the offer period and, if appropriate, by no
later than 3.30 p.m. (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 Takeover Code, any person who is, or becomes,
interested in 1 per cent. 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 p.m. (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.
General
Bidco reserves the right to elect, with the consent of the Panel, and subject
to the terms of Co-operation Agreement, to implement the Acquisition by way of
a Takeover Offer as an alternative to the Scheme. In such an event, the
Takeover Offer will be implemented on the same terms or, if Bidco so decides,
on such other terms being no less favourable (subject to appropriate
amendments), so far as applicable, as those which would apply to the Scheme
and subject to the amendment referred to in Appendix 1 to this Announcement.
Upon sufficient acceptances being received in respect of such Takeover Offer,
Bidco intends to exercise its rights to apply the provisions of Chapter 3 of
Part 28 of the Companies Act so as to acquire compulsorily the remaining
Medica Shares in respect of which the Takeover Offer has not been accepted.
Investors should be aware that Bidco may purchase Medica Shares otherwise than
under any Takeover Offer or the Scheme, including pursuant to privately
negotiated purchases.
If you are in any doubt about the contents of this Announcement or the action
you should take, you are recommended to seek your own independent financial
advice immediately from your stockbroker, bank manager, solicitor or
independent financial adviser duly authorised under FSMA if you are resident
in the United Kingdom or, if not, from another appropriate authorised
independent financial adviser.
Rule 2.9
For the purposes of Rule 2.9 of the Takeover Code, Medica confirms that, as at
the date of this Announcement, it had in issue 122,633,635 ordinary shares of
0.2p each. Medica holds no shares in treasury. The International Securities
Identification Number (ISIN) number of the ordinary shares is GB00BYV24996.
Appendix 1
CONDITIONS TO AND FURTHER TERMS OF THE Scheme and the ACQUISITION
PART A: CONDITIONS TO THE SCHEME AND THE ACQUISITION
Long Stop Date
1. The Acquisition will be conditional upon the
Scheme becoming unconditional and being Effective, subject to the provisions
of the Takeover Code, by no later than 6.00 p.m. on the Long Stop Date.
Scheme Approval
2. The Scheme will be conditional upon:
(a)
(i) its approval by a majority in number of the Scheme Shareholders,
present and voting (and entitled to vote), either in person or by proxy, at
the Court Meeting (or at any adjournment of the Court Meeting) and who
represent at least 75 per cent. in value of the Scheme Shares voted by those
Scheme Shareholders; and
(ii) such Court Meeting being held on or before the 22nd day after 9
June 2023, being the expected date of the Court Meeting to be set out in the
Scheme Document (or such later date as may be agreed by Bidco and Medica, with
the consent of the Panel, and the Court may approve (if such approval is
required));
(b)
(i) all Resolutions being duly passed by the requisite majority or
majorities of Medica Shareholders at the General Meeting (or at any
adjournment of the General Meeting); and
(ii) such General Meeting being held on or before the 22nd day after 9
June 2023, being the expected date of the General Meeting to be set out in the
Scheme Document (or such later date as may be agreed by Bidco and Medica, with
the consent of the Panel, and the Court may approve (if such approval is
required)); and
(c)
(i) the sanction of the Scheme by the Court (with or without
modification, but subject to any modification being on terms acceptable to
Medica and Bidco) and the delivery of a copy of the Court Order to the
Registrar of Companies; and
(ii) the Sanction Hearing being held on or before the 22nd day after the
expected date of such hearing to be set out in the Scheme Document (or such
later date as may be agreed by Bidco and Medica with the consent of the Panel,
and the Court may approve (if such approval is required)).
General Conditions
In addition, subject as stated in Part B below and to the requirements of the
Panel, Bidco and Medica have agreed that the Acquisition will be conditional
upon the following Conditions and, accordingly, the Court Order will not be
delivered to the Registrar of Companies unless such Conditions (as amended if
appropriate) have been satisfied or, where relevant, waived:
Notifications, waiting periods and Authorisations
3. all notifications, filings or applications
which are necessary or reasonably considered appropriate or desirable by Bidco
having been made in connection with the Acquisition and all necessary waiting
periods (including any extensions thereof) under any applicable legislation or
regulation of any jurisdiction having expired, lapsed or been terminated (as
appropriate) and all statutory and regulatory obligations in any jurisdiction
having been complied with in each case in respect of the Acquisition and its
implementation and all Authorisations reasonably necessary or appropriate for
or in respect of the Acquisition and, except pursuant to Chapter 3 of Part 28
of the Companies Act, the acquisition of any shares or other securities in, or
control or management of, Medica or any other member of the Wider Medica Group
by any member of the Wider Bidco Group having been obtained in terms and in a
form reasonably satisfactory to Bidco from all appropriate Third Parties or
(without prejudice to the generality of the foregoing) from any person or
bodies with whom any member of the Wider Medica Group or the Wider Bidco Group
has entered into contractual arrangements and all such Authorisations
necessary, appropriate or desirable to carry on the business of any member of
the Wider Medica Group in any jurisdiction having been obtained and all such
Authorisations remaining in full force and effect and filings necessary for
such purpose have been made and at the time at which the Acquisition becomes
otherwise unconditional and there being no notice or intimation of an
intention to revoke, suspend, restrict, modify or not to renew such
Authorisations;
General antitrust and regulatory
4. no antitrust regulator or Third Party having
given notice of a decision to take or implement any action, proceeding, suit,
investigation or reference (and in each case, not having withdrawn the same),
or having required any action to be taken or otherwise having done anything,
or having enacted or made any statute, regulation, decision, order or change
to published binding practice (and in each case, not having withdrawn the
same) and there not continuing to be outstanding any statute, regulation,
decision or order which (to an extent which is material in the context of the
Acquisition, the Wider Medica Group or the Wider Bidco Group, as the case may
be, would or might reasonably be expected to:
(a) require, prevent or delay the
divestiture or alter the terms envisaged for such divestiture by any member of
the Wider Bidco Group or by any member of the Wider Medica Group of all or any
part of its businesses, assets or property or impose any limitation on the
ability of all or any of them to conduct their businesses (or any part
thereof) or to own, control or manage any of their assets or properties (or
any part thereof);
(b) require any member of the Wider Bidco
Group or the Wider Medica Group to acquire or offer to acquire any shares,
other securities (or the equivalent) or interest in any member of the Wider
Medica Group or any asset owned by any Third Party (other than in the
implementation of the Acquisition);
(c) impose any limitation on, or result
in a delay in, the ability of any member of the Wider Bidco Group directly or
indirectly to acquire, hold or to exercise effectively all or any rights of
ownership in respect of shares, loans or securities convertible into shares or
any other securities in any member of the Wider Medica Group or on the ability
of any member of the Wider Medica Group or any member of the Wider Bidco Group
directly or indirectly to hold or exercise effectively all or any rights of
ownership in respect of shares, loans or securities convertible into shares or
any other securities (or the equivalent) in, or to exercise voting or
management control over, any member of the Wider Medica Group;
(d) otherwise adversely affect any or all
of the business, assets, profits, financial or trading position or prospects
of any member of the Wider Medica Group or any member of the Wider Bidco
Group;
(e) result in any member of the Wider
Medica Group or any member of the Wider Bidco Group ceasing to be able to
carry on business under any name under which it presently carries on business;
or
(f) make the Scheme or the Acquisition,
its implementation or the acquisition of any shares or other securities in, or
control or management of, Medica or any member of the Wider Medica Group by
any member of the Wider Bidco Group void, unenforceable and/or illegal under
the laws of any relevant jurisdiction, or otherwise, directly or indirectly
prevent or prohibit, restrict, restrain or delay or otherwise interfere with
the implementation of, or impose additional conditions or obligations with
respect to, or otherwise challenge, impede, interfere or require material
amendment of the Scheme and/or the Acquisition or the acquisition of any
shares or other securities in, or control or management of, Medica or any
member of the Wider Medica Group by any member of the Wider Bidco Group;
(g) require, prevent or delay a
divestiture by any member of the Wider Bidco Group of any shares or other
securities (or the equivalent) in any member of the Wider Medica Group or any
member of the Wider Bidco Group; or
(h) impose any limitation on the ability
of any member of the Wider Bidco Group or any member of the Wider Medica Group
to conduct, integrate or co-ordinate all or any part of its business with all
or any part of the business of any other member of the Wider Bidco Group
and/or the Wider Medica Group,
and all applicable waiting and other time periods (including any extensions of
them) during which any such antitrust regulator or Third Party could decide to
take, institute, implement or threaten any such action, proceeding, suit,
investigation, enquiry or reference or take any other step under the laws of
any jurisdiction in respect of the Acquisition or the acquisition of any
Medica Shares or otherwise intervene having expired, lapsed or been
terminated;
Certain matters arising as a result of any arrangement, agreement, etc.
5. except as Disclosed, there being no provision
of any arrangement, agreement, lease, licence, franchise, permit or other
instrument to which any member of the Wider Medica Group is a party or by or
to which any such member or any of its assets is or may be bound, entitled or
subject to or any event or circumstance which, as a consequence of the
Acquisition or the proposed acquisition or the acquisition by any member of
the Wider Bidco Group of any shares or other securities (or the equivalent) in
Medica or because of a change in the control or management of any member of
the Wider Medica Group or otherwise, would or might reasonably be expected to
result in (in any case to an extent which is material in the context of the
Acquisition, the Wider Medica Group or the Wider Bidco Group, as the case may
be:
(a) any monies borrowed by, or any other
indebtedness or liabilities, actual or contingent, of, or any grant available
to, any member of the Wider Medica Group being or becoming repayable, or
capable of being declared repayable, immediately or before its or their stated
maturity date or repayment date, or the ability of any such member to borrow
monies or incur any indebtedness being withdrawn or inhibited or being capable
of becoming or being withdrawn or inhibited;
(b) the creation, save in the ordinary and
usual course of business, or enforcement of any mortgage, charge or other
security interest over the whole or any part of the business, property, assets
or interests of any member of the Wider Medica Group or any such mortgage,
charge or other security interest (whenever created, arising or having arisen)
being enforced or becoming enforceable;
(c) any such arrangement, agreement,
lease, licence, franchise, permit or other instrument being terminated or the
rights, liabilities, obligations or interests of any member of the Wider
Medica Group being adversely modified or adversely affected or any obligation
or liability arising or any adverse action being taken or arising thereunder;
(d) any liability of any member of the
Wider Medica Group to make any severance, termination, bonus or other payment
to any of its directors, or other officers;
(e) the rights, liabilities, obligations,
interests or business of any member of the Wider Medica Group or any member of
the Wider Bidco Group under any such arrangement, agreement, licence, permit,
lease or instrument or the interests or business of any member of the Wider
Medica Group or any member of the Wider Bidco Group in or with any other
person or body or firm or company (or any arrangement or agreement relating to
any such interests or business) being or becoming capable of being terminated,
or adversely modified or affected or any onerous obligation or liability
arising or any adverse action being taken thereunder;
(f) any member of the Wider Medica Group
ceasing to be able to carry on business under any name under which it
presently carries on business;
(g) the value of, or the financial or
trading position or prospects of, any member of the Wider Medica Group being
prejudiced or adversely affected; or
(h) the creation or acceleration of any
liability (actual or contingent) by any member of the Wider Medica Group other
than trade creditors or other liabilities incurred in the ordinary course of
business,
and, no event having occurred which, under any provision of any arrangement,
agreement, licence, permit, franchise, lease or other instrument to which any
member of the Wider Medica Group is a party or by or to which any such member
or any of its assets are bound, entitled or subject, would or might result in
any of the events or circumstances as are referred to in Conditions 5(a) to
(h);
Certain events occurring since 31 December 2022
6. except as Disclosed, no member of the Wider
Medica Group having since 31 December 2022:
(a) issued or agreed to issue or
authorised or proposed or announced its intention to authorise or propose the
issue, of additional shares of any class, or securities or securities
convertible into, or exchangeable for, or rights, warrants or options to
subscribe for or acquire, any such shares, securities or convertible
securities or transferred or sold or agreed to transfer or sell or authorised
or proposed the transfer or sale of Medica Shares out of treasury (except,
where relevant, as between Medica and wholly-owned subsidiaries of Medica or
between the wholly-owned subsidiaries of Medica and except for the issue or
transfer out of treasury of Medica Shares on the exercise of employee share
options or vesting of employee share awards in the ordinary course under the
Medica Share Plans);
(b) recommended, declared, paid or made or
proposed to recommend, declare, pay or make any bonus issue, dividend or other
distribution (whether payable in cash or otherwise) other than dividends (or
other distributions whether payable in cash or otherwise) lawfully paid or
made by any wholly-owned subsidiary of Medica to Medica or any of its
wholly-owned subsidiaries;
(c) other than pursuant to the
Acquisition (and except for transactions between Medica and its wholly-owned
subsidiaries or between the wholly-owned subsidiaries of Medica and
transactions in the ordinary course of business) implemented, effected,
authorised or proposed or announced its intention to implement, effect,
authorise or propose any merger, demerger, reconstruction, amalgamation,
scheme, commitment or offer or disposal of assets or shares or loan capital
(or the equivalent thereof) in any undertaking or undertakings, in any such
case to an extent which is material in the context of the Wider Medica Group
taken as a whole;
(d) (except for transactions between
Medica and its wholly-owned subsidiaries or between the wholly-owned
subsidiaries of Medica and except for transactions in the ordinary course of
business), disposed of, or transferred, mortgaged or created any security
interest over any material asset or any right, title or interest in any
material asset or authorised, proposed or announced any intention to do so;
(e) (except for transactions between
Medica and its wholly-owned subsidiaries or between the wholly-owned
subsidiaries of Medica), issued, authorised or proposed or announced an
intention to authorise or propose, the issue of or made any change in or to
the terms of any debentures or become subject to any contingent liability or
incurred or increased any indebtedness which is material in the context of the
Wider Medica Group as a whole;
(f) (except for transactions between
Medica and its wholly-owned subsidiaries or between the wholly-owned
subsidiaries of Medica and except for transactions in the ordinary course of
business), entered into any licence or other disposal of intellectual property
rights of any member of the Wider Medica Group;
(g) entered into or varied or authorised,
proposed or announced its intention to enter into or vary any material
contract, arrangement, agreement, transaction or commitment (whether in
respect of capital expenditure or otherwise) which is of a long term, unusual
or onerous nature or magnitude or which is or which involves or could involve
an obligation of a nature or magnitude which is likely to be material
restrictive on the business of any member of the Wider Medica Group;
(h) entered into or varied the terms of,
or made any offer (which remains open for acceptance) to enter into or vary
the terms of any contract, service agreement, commitment or arrangement with
any director or senior executive of any member of the Wider Medica Group;
(i) proposed, agreed to provide or
modified the terms of any share option scheme, incentive scheme or other
benefit relating to the employment or termination of employment of any
employee of the Wider Medica Group;
(j) purchased, redeemed or repaid or
announced any proposal to purchase, redeem or repay any of its own shares or
other securities or reduced or, except in respect of the matters mentioned in
sub-paragraph (a) above, made any other change to any part of its share
capital;
(k) (except for claims between Medica and
its wholly-owned subsidiaries or between the wholly-owned subsidiaries of
Medica), waived, compromised or settled any claim otherwise than of an
immaterial amount in the ordinary course of business;
(l) terminated or varied the terms of
any agreement or arrangement between any member of the Wider Medica Group and
any other person in a manner which would or might reasonably be expected to
have a material adverse effect on the financial position of the Wider Medica
Group taken as a whole;
(m) made any material alteration to its
articles of association or other constitutional documents (other than in
connection with the Scheme);
(n) except in relation to changes made or
agreed as a result of, or arising from, changes to legislation, made or agreed
or consented to any change to:
(i) the terms of the trust deeds and rules
constituting the pension scheme(s) established by any member of the Wider
Medica Group for its directors, employees or their dependants;
(ii) the contributions payable to any such scheme(s)
or to the benefits which accrue, or to the pensions which are payable,
thereunder;
(iii) the basis on which qualification for, or accrual
or entitlement to, such benefits or pensions are calculated or determined; or
(iv) the basis upon which the liabilities (including
pensions) of such pension schemes are funded, valued, made, agreed or
consented to;
(o) been unable, or admitted in writing
that it is unable, to pay its debts or commenced negotiations with one or more
of its creditors with a view to rescheduling or restructuring any of its
indebtedness, or having stopped or suspended (or threatened to stop or
suspend) payment of its debts generally or ceased or threatened to cease
carrying on all or a substantial part of its business;
(p) taken or proposed any steps, corporate
action or had any legal proceedings instituted or threatened against it in
relation to the suspension of payments, a moratorium of any indebtedness, its
winding-up (voluntary or otherwise), dissolution, reorganisation or for the
appointment of a receiver, administrator, manager, administrative receiver,
trustee or similar officer of all or any of its assets or revenues or any
analogous or equivalent steps or proceedings in any jurisdiction or appointed
any analogous person in any jurisdiction or had any such person appointed;
(q) (except for transactions between
Medica and its wholly-owned subsidiaries or between the wholly-owned
subsidiaries of Medica), made, authorised, proposed or announced an intention
to propose any change in its loan capital;
(r) entered into, implemented or
authorised the entry into, any joint venture, asset or profit sharing
arrangement, partnership, composition, assignment, reconstruction,
amalgamation, commitment, scheme or other similar transaction or arrangement
(other than the Scheme);
(s) having taken (or agreed or proposed
to take) any action which requires or would require, the consent of the Panel
or the approval of Medica Shareholders in general meeting in accordance with,
or as contemplated by, Rule 21.1 of the Takeover Code; or
(t) entered into any agreement,
arrangement, commitment or contract or passed any resolution or made any offer
(which remains open for acceptance) with respect to or announced an intention
to, or to propose to, effect any of the transactions, matters or events
referred to in this Condition 6;
No adverse change, litigation, regulatory enquiry or similar
7. except as Disclosed, since 31 December 2022
there having been:
(a) no adverse change and no circumstance
having arisen which would or might be expected to result in any adverse change
or deterioration in, the business, assets, value, financial or trading
position or profits or prospects or operational performance of any member of
the Wider Medica Group which is material in the context of the Wider Medica
Group taken as a whole or is material in the context of the Acquisition;
(b) no litigation, arbitration
proceedings, prosecution or other legal proceedings having been threatened,
announced or instituted by or against or remaining outstanding against or in
respect of, any member of the Wider Medica Group or to which any member of the
Wider Medica Group is or may become a party (whether as claimant, defendant or
otherwise) having been threatened, announced, instituted or remaining
outstanding by, against or in respect of, any member of the Wider Medica
Group, in each case which is or might reasonably be expected to be material in
the context of the Wider Medica Group taken as a whole or is material in the
context of the Acquisition;
(c) no enquiry, review or investigation
by, or complaint or reference to, any Third Party against or in respect of any
member of the Wider Medica Group having been threatened, announced or
instituted or remaining outstanding by, against or in respect of any member of
the Wider Medica Group, in each case which might reasonably be expected to
have a material adverse effect on the Wider Medica Group taken as a whole or
is material in the context of the Acquisition;
(d) no contingent or other liability
having arisen or become apparent to Bidco or increased other than in the
ordinary course of business which is reasonably likely to affect adversely the
business, assets, financial or trading position or profits or prospects or
operational performance of any member of the Wider Medica Group to an extent
which is material in the context of the Wider Medica Group taken as a whole or
is material in the context of the Acquisition;
(e) no steps having been taken and no
omissions having been made which are reasonably likely to result in the
withdrawal, cancellation, termination or modification of any licence held by
any member of the Wider Medica Group which is necessary for the proper
carrying on of its business and the withdrawal, cancellation, termination or
modification of which might reasonably be expected to have a material adverse
effect on the Wider Medica Group taken as a whole or is material in the
context of the Acquisition; and
(f) no member of the Wider Medica Group
having conducted its business in breach of any applicable laws or regulations
which might reasonably be expected to have a material adverse effect on the
Wider Medica Group taken as a whole or is material in the context of the
Acquisition;
No discovery of certain matters regarding information, liabilities and
environmental issues
8. except as Disclosed, Bidco not having
discovered that:
(a) any financial, business or other
information concerning the Wider Medica Group publicly announced before the
date of this Announcement or disclosed at any time to any member of the Wider
Bidco Group by or on behalf of any member of the Wider Medica Group before the
date of this Announcement is misleading, contains a material misrepresentation
of any fact, or omits to state a fact necessary to make that information not
misleading, in any such case to a material extent;
(b) any member of the Wider Medica Group
or any partnership, company or other entity in which any member of the Wider
Medica Group has a significant economic interest and which is not a subsidiary
undertaking of Medica is, otherwise than in the ordinary course of business,
subject to any liability, contingent or otherwise which is material in the
context of the Wider Medica Group taken as a whole or material in the context
of the Acquisition;
(c) any past or present member of the
Wider Medica Group has not complied in any material respect with all
applicable legislation, regulations or other requirements of any jurisdiction
or any Authorisations relating to the use, treatment, storage, carriage,
disposal, discharge, spillage, release, leak or emission of any waste or
hazardous substance or any substance likely to impair the environment
(including property) or harm human or animal health or otherwise relating to
environmental matters or the health and safety of humans, which non-compliance
would be likely to give rise to any material liability including any penalty
for non-compliance (whether actual or contingent) on the part of any member of
the Wider Medica Group, in each case to an extent which is material in the
context of the Wider Medica Group taken as a whole or material in the context
of the Acquisition;
(d) there has been a disposal, discharge,
spillage, accumulation, release, leak, emission or the migration, production,
supply, treatment, storage, transport or use of any waste or hazardous
substance or any substance likely to impair the environment (including any
property) or harm human or animal health which (whether or not giving rise to
non-compliance with any law or regulation), would be likely to give rise to
any material liability (whether actual or contingent) on the part of any
member of the Wider Medica Group, in each case to an extent which is material
in the context of the Wider Medica Group taken as a whole or material in the
context of the Acquisition;
(e) there is or is reasonably likely to be
any obligation or liability (whether actual or contingent) or requirement to
make good, remediate, repair, reinstate or clean up any property, asset or any
controlled waters currently or previously owned, occupied, operated or made
use of or controlled by any past or present member of the Wider Medica Group
(or on its behalf), or in which any such member may have or previously have
had or be deemed to have had an interest, under any environmental legislation,
common law, regulation, notice, circular, Authorisation or order of any Third
Party in any jurisdiction or to contribute to the cost thereof or associated
therewith or indemnify any person in relation thereto; or
(f) circumstances exist (whether as a
result of making the Acquisition or otherwise) which would be reasonably
likely to lead to any Third Party instituting (or whereby any member of the
Wider Medica Group would be likely to be required to institute), an
environmental audit or take any steps which would in any such case be
reasonably likely to result in any actual or contingent liability to improve
or install new plant or equipment or to make good, repair, reinstate or clean
up any property of any description or any asset now or previously owned,
occupied or made use of by any past or present member of the Wider Medica
Group (or on its behalf) or by any person for which a member of the Wider
Medica Group is or has been responsible, or in which any such member may have
or previously have had or be deemed to have had an interest, which is material
in the context of the Wider Medica Group taken as a whole or material in the
context of the Acquisition;
Intellectual property
9. except as Disclosed, no circumstance having
arisen or event having occurred in relation to any intellectual property owned
or used by any member of the Wider Medica Group, including:
(a) any member of the Wider Medica Group
losing its title to any material intellectual property used in its business,
or any material intellectual property owned by the Wider Medica Group being
revoked, cancelled or declared invalid;
(b) any claim being asserted in writing or
threatened in writing by any person challenging the ownership of any member of
the Wider Medica Group to, or the validity or effectiveness of, any of its
material intellectual property; or
(c) any agreement regarding the use of
any material intellectual property licensed to or by any member of the Wider
Medica Group being terminated or varied; and
Anti-corruption, sanctions and criminal property
10. except as Disclosed, Bidco not having discovered:
(a) (i) any past or present member,
director, officer or employee of the Wider Medica Group is or has at any time
engaged in any activity, practice or conduct would constitute an offence under
the Bribery Act 2010, the US Foreign Corrupt Practices Act of 1977, as
amended, or any other anti-corruption legislation applicable to the Wider
Medica Group; or (ii) any person that performs or has performed services for
or on behalf of the Wider Medica Group is or has at any time engaged in any
activity, practice or conduct in connection with the performance of such
services which would constitute an offence under the Bribery Act 2010, the US
Foreign Corrupt Practices Act of 1977, as amended, or any other applicable
anti-corruption legislation;
(b) any asset of any member of the Wider
Medica Group constitutes criminal property as defined by section 340(3) of the
Proceeds of Crime Act 2002 (but disregarding paragraph (b) of that definition)
or proceeds of crime under any other applicable law, rule, or regulation
concerning money laundering or proceeds of crime or any member of the Wider
Medica Group is found to have engaged in activities constituting money
laundering under any applicable law, rule, or regulation concerning money
laundering;
(c) any past or present member,
director, officer or employee of the Wider Medica Group, or any other person
for whom any such person may be liable or responsible, has engaged in any
business with, made any investments in, made any funds or assets available to
or received any funds or assets from: (i) any government, entity or individual
in respect of which US, UK or European Union persons, or persons operating in
those territories, are prohibited from engaging in activities or doing
business, or from receiving or making available funds or economic resources,
by applicable US, UK or European Union laws or regulations, including the
economic sanctions administered by the United States Office of Foreign Assets
Control or HM Treasury & Customs; or (ii) any government, entity or
individual targeted by any of the economic sanctions of the United Nations,
the United States, the United Kingdom, the European Union or any of its member
states; or
(d) a member of the Wider Medica Group has
engaged in any transaction or conduct which would cause any member of the
Wider Bidco Group to be in breach of any applicable law or regulation upon its
Acquisition of Medica, including the economic sanctions of the United States
Office of Foreign Assets Control or HM Treasury & Customs, or any
government, entity or individual targeted by any of the economic sanctions of
the United Nations, the United States, the United Kingdom, the European Union
or any of its member states.
PART B: CERTAIN FURTHER TERMS OF THE ACQUISITION
1. Conditions 2(a), 2(b) and 3 to 10 (inclusive)
of Part A above must each be fulfilled, determined by Bidco to be or to remain
satisfied or (if capable of waiver) be waived by Bidco prior to the
commencement of the Sanction Hearing, failing which the Scheme will lapse.
2. Notwithstanding the paragraph above, subject to
the requirements of the Panel and the Takeover Code, Bidco reserves the right
in its sole discretion to waive:
(a) the deadline set out in Condition 1 of
Part A above, and any deadlines set out in Condition 2 of Part A above for the
timing of the Court Meeting, the General Meeting and the Sanction Hearing.
If any such deadline is not met, Bidco shall make an announcement by 8.00
a.m. on the Business Day following such deadline confirming whether it has
invoked or waived the relevant Condition or agreed with Medica to extend the
deadline in relation to the relevant Condition. In all other respects,
Conditions 1 and 2 of Part A above cannot be waived; and
(b) in whole or in part, all or any of
Conditions 3 to 10 (inclusive) of Part A above.
3. Bidco shall be under no obligation to waive (if
capable of waiver), to determine to be or to treat as satisfied any of the
Conditions that it is entitled (with the consent of the Panel and subject to
the requirements of the Takeover Code) to invoke, by a date earlier than the
latest date specified above for the fulfilment or waiver thereof,
notwithstanding that the other Conditions may at such earlier date have been
waived or fulfilled and that there are at such earlier date no circumstances
indicating that any of such Conditions may not be capable of fulfilment.
4. If Bidco is required by the Panel to make an
offer for Medica Shares under the provisions of Rule 9 of the Takeover Code,
Bidco may make such alterations to any of the above Conditions and terms of
the Acquisition as are necessary to comply with the provisions of that Rule.
5. Under Rule 13.5(a) of the Takeover Code, Bidco
may only invoke a Condition that is subject to Rule 13.5(a) of the Takeover
Code so as to cause the Acquisition not to proceed, to lapse or to be
withdrawn with the consent of the Panel. The Panel will normally only give
its consent if the circumstances which give rise to the right to invoke the
Condition are of material significance to Bidco in the context of the
Acquisition. This will be judged by reference to the facts of each case at
the time that the relevant circumstances arise. Conditions 1, 2(a), 2(b) and
2(c) of Part A above and, if applicable, any acceptance condition if the
Acquisition is implemented by means of a Takeover Offer, are not subject to
Rule 13.5(a) of the Takeover Code.
6. Any Condition that is subject to Rule 13.5(a)
of the Takeover Code may be waived by Bidco.
7. Subject to paragraph 3(g) of Appendix 7 to the
Takeover Code, Bidco will be under no obligation to waive (if capable of
waiver) or to treat as fulfilled any of the Conditions by a date earlier than
the latest date for the fulfilment of that Condition notwithstanding that the
other Conditions of the Acquisition may at such earlier date have been waived
or fulfilled and that there are at such earlier date no circumstances
indicating that any of such Conditions may not be capable of fulfilment.
8. Each of the Conditions will be regarded as a
separate Condition and will not be limited by reference to any other
Condition.
9. Bidco reserves the right to elect to implement
the Acquisition by way of a Takeover Offer as an alternative to the Scheme
(subject to the Panel's consent and the terms of the Co-operation
Agreement). In such event, the Acquisition will be implemented on the same
terms (subject to appropriate amendments including (without limitation) the
inclusion of an acceptance condition which will be set at 90 per cent. (or
such lesser percentage as Bidco may decide after, to the extent necessary,
consultation with the Panel, being in any case more than 50 per cent. of the
voting rights attaching to Medica Shares) of shares to which the Acquisition
relates and those required by, or deemed appropriate by, Bidco under
applicable law, so far as applicable) as those which would apply to the
Scheme. Further, if sufficient acceptances of such Takeover Offer are
received and/or sufficient Medica Shares are otherwise acquired, it will be
the intention of Bidco to apply the provisions of the Companies Act to acquire
compulsorily any outstanding Medica Shares to which such Takeover Offer
relates.
10. The Medica Shares to be acquired under the
Acquisition will be acquired with full title guarantee, fully paid and free
from all liens, equities, charges, encumbrances, options, rights of
pre-emption and any other third party rights and interests of any nature and
together with all rights now or hereafter attaching or accruing to them,
including, without limitation, voting rights and the right to receive and
retain in full all dividends and other distributions (if any) declared, made
or paid, or any other return of value (whether by reduction of share capital
or share premium account or otherwise) made, on or after the Effective Date
(other than any dividend in respect of which a corresponding reduction in the
Consideration has been made as described in paragraph 11 below).
11. If, prior to the Effective Date, the 2022 Final
Dividend is declared by Medica Shareholders at Medica's 2023 annual general
meeting, the Consideration will be reduced by the full amount of such dividend
and the relevant eligible Medica Shareholders will be entitled to receive and
retain such dividend, and any reference in this Announcement to the
Consideration will be deemed to be a reference to the Consideration as so
reduced.
If the Effective Date occurs prior to the 2022 Final Dividend being declared
by Medica Shareholders at Medica's 2023 annual general meeting, there will be
no Final Dividend and no equivalent payment will be made to Medica
Shareholders by Bidco.
If any other dividend, distribution and/or return of value is proposed,
authorised, declared, made or paid or becomes payable in respect of Medica
Shares on or after the date of this Announcement and before the Effective
Date, Bidco reserves the right (without prejudice to any right of Bidco, with
the consent of the Panel, to invoke Condition 6(b) of Part A above) to reduce
the Consideration by the amount of any such other dividend, distribution
and/or other return of value. If Bidco exercises its right to reduce the
Consideration by all or part of the amount of any other dividend, other
distribution and/or other return of value, the relevant eligible Medica
Shareholders will be entitled to receive and retain such other dividend,
distribution and/or other return of value, and any reference in this
Announcement to the Consideration will be deemed to be a reference to the
Consideration as so reduced.
Any exercise by Bidco of its rights referred to in the above paragraph shall
be the subject of an announcement and, for the avoidance of doubt, shall not
be regarded as constituting any revision or variation of the terms of the
Scheme. If and to the extent that any such dividend, distribution and/or
other return of value has been declared or announced but not paid or made or
is not payable in respect of the Medica Shares prior to the Effective Date or
by reference to a record date prior to the Effective Date or such dividend,
distribution and/or other return of value is: (i) transferred pursuant to the
Acquisition on a basis which entitles Bidco to receive the dividend, other
distribution and/or other return of value and to retain it or; (ii) cancelled
before payment, the Consideration shall not be subject to change in accordance
with the above paragraph.
12. The availability of the Acquisition to persons not
resident in the United Kingdom may be affected by the laws of the relevant
jurisdictions. Any person who is subject to the laws of any jurisdiction
other than the United Kingdom should inform themselves about and observe any
applicable requirements. Further information in relation to Overseas
Shareholders will be contained in the Scheme Document.
13. The Acquisition is not being made, directly or
indirectly, in, into or from, or by use of the mails of, or by any means of
instrumentality (including, but not limited to, facsimile, e-mail or other
electronic transmission, telex or telephone) of interstate or foreign commerce
of, or of any facility of a national, state or other securities exchange of,
any Restricted Jurisdiction.
14. The Scheme will be governed by the laws of England
and Wales and will be subject to the jurisdiction of the courts of England and
Wales and to the Conditions and further terms set out in this Appendix 1 and
to be set out in the Scheme Document. The Scheme will be subject to the
applicable requirements of the Takeover Code, the Panel, the London Stock
Exchange, the Listing Rules, the FCA and the Registrar of Companies.
Appendix 2
SOURCES OF INFORMATION AND BASES OF CALCULATION
In this Announcement, unless otherwise stated or the context otherwise
requires, the following sources and bases have been used:
1. The "Latest Practicable Date" for the purposes
of this Announcement means close of business on 21 April 2023 (being the last
Business Day before the date of this Announcement).
2. The equity value of Medica's entire issued and
to be issued ordinary share capital has been calculated on the basis of
126,875,625 Medica Shares, comprising:
(a) 122,633,635 Medica Shares in issue as
at the Latest Practicable Date; plus
(b) 4,290,344 Medica Shares to be issued
on or after the date of this Announcement on the exercise of options or
vesting of awards granted or agreed to be granted under the Medica Share Plans
(in accordance with the terms set out in the Co-operation Agreement); less
(c) 48,354 Medica Shares as at the
Latest Practicable Date held by the Medica employee benefit trust which can be
used to satisfy the exercise of options and vesting of awards under the Medica
Share Plans.
3. The value of the Acquisition, based on the
Consideration, of £269 million is calculated on the basis of the issued and
to be issued share capital of Medica (as set out in paragraph 2 above).
4. The implied enterprise value multiple of
approximately 16.6x underlying EBITDA for the year ended 31 December 2022 is
based on the enterprise value of £268 million and Medica's underlying EBITDA
of £16.2 million.
5. The implied enterprise value of £268.4 million
is calculated by reference to the fully diluted equity value less net cash of
£0.8 million as at 31 December 2022, plus lease liabilities of £1.0m as at
31 December 2022, less investments in joint ventures of £0.1 million as at 31
December 2022, less expected cash inflow from exercise of options of £0.7m.
6. Underlying EBITDA for the year ending 31
December 2022 of £16.2 million is calculated by reference to underlying
operating profit of £13.6 million adjusted for the effects of amortisation of
intangible fixed assets of £0.6 million and total depreciation of £1.9
million. Underlying EBITDA is a non-GAAP measure.
7. The premium calculations to the price per
Medica Share used in this Announcement have been calculated by reference to:
(a) the Closing Price on 21 April 2023
(being the last Business Day before the commencement of the Offer Period) of
160.0 pence per Medica Share;
(b) the three-month volume weighted
average price of 160.1 pence per Medica Share ended on 21 April 2023 (being
the last Business Day before the commencement of the Offer Period) derived
from Bloomberg; and
(c) the six-month volume weighted
average price of 141.3 pence per Medica Share ended on 21 April 2023 (being
the last Business Day before the commencement of the Offer Period) derived
from Bloomberg.
8. The Closing Price on any particular date is
taken from the Daily Official List.
9. Volume-weighted average prices have been
derived from Bloomberg and have been rounded to the nearest single decimal
place.
10. Unless otherwise stated, the financial information
of Medica is extracted from the preliminary financial statements of Medica for
the financial year ended 31 December 2022, published via regulatory news
service on 29 March 2023.
11. Certain figures included in this Announcement have
been subject to rounding adjustments.
Appendix 3
IRREVOCABLE UNDERTAKINGS
1. Medica Directors
The following Medica Directors have given irrevocable undertakings to vote in
favour of the Scheme at the Court Meeting and the Resolutions to be proposed
at the General Meeting and, if Bidco exercises its right to implement the
Acquisition by way of a Takeover Offer (subject to the consent of the Panel
and the terms of the Co-operation Agreement), to accept or procure acceptance
of such Takeover Offer, in each case in respect of their own legal and/or
beneficial holdings (or those Medica Shares over which they have control) of
Medica Shares as well as any further Medica Shares of which they may become
the legal and/or beneficial holder (whether as a result of the exercise of
options or vesting of awards under the Medica Share Plans or otherwise):
Name Total Number of Medica Shares Percentage of existing issued share capital of Medica
Gordon Roy Davis 132,726 0.1%
Stuart Quin* Nil 0.0%
Richard Jones 25,156 0.0%
Joanne Easton 36,288 0.0%
Dr Junaid Bajwa 17,241 0.0%
Total 211,411 0.2%
* Stuart Quin's holding of 177,480 Medica Shares are
beneficially held by his spouse, Mallika Kaviratne. Mallika Kaviratne has
signed a separate irrevocable undertaking as outlined in paragraph 2 below
These irrevocable undertakings remain binding in the event a higher competing
offer is made for Medica and will only cease to be binding if:
· the Scheme Document is not sent to Medica
Shareholders within 28 days (or such longer period as Medica and Bidco agree,
and the Panel consent);
· where Bidco has elected (in accordance with and
subject to the terms of the Co-operation Agreement and with Panel consent) to
proceed with the implementation of the Acquisition by way of a Takeover Offer
and the Offer Document is not sent to Medica Shareholders within 28 days;
· Bidco announces, with consent of the Panel, that it
does not intend to make or proceed with the Acquisition and no new, revised or
replacement Takeover Offer or Scheme is announced by Bidco in accordance with
Rule 2.7 of the Takeover Code at the same time;
· the Scheme (or Takeover Offer, as applicable)
lapses or is withdrawn in accordance with its terms and no new, revised or
replacement Takeover Offer or Scheme is announced by Bidco by such time;
· the Acquisition has not become effective or, in the
event Bidco has elected (in accordance with and subject to the terms of the
Co-operation Agreement and with Panel consent) to proceed with the
implementation of the Acquisition by way of a Takeover Offer, the Takeover
Offer has not become unconditional, in each case by the Long Stop Date; or
· the date on which any competing offer for the
entire issued and to be issued share capital of Medica is declared
unconditional (if implemented by way of a takeover offer) or, if proceeding by
way of a scheme of arrangement, becomes effective.
2. Other Medica Shareholders
Irrevocable undertaking of non-director individual
The following holder, controller and/or beneficial owner of Medica Shares has
given an irrevocable undertaking to vote in favour of the Scheme at the Court
Meeting and the Resolutions to be proposed at the General Meeting and, if
Bidco exercises its right to implement the Acquisition by way of a Takeover
Offer (subject to the consent of the Panel and the terms of the Co-operation
Agreement), to accept or procure acceptance of such Takeover Offer, in each
case in respect of their own legal and/or beneficial holdings (or those Medica
Shares over which they have control) of Medica Shares as well as any further
Medica Shares of which they may become the legal and/or beneficial holder:
Registered Holder Beneficial Holder Total Number of Medica Shares Percentage of existing issued share capital of Medica
Diagonal Nominees Limited Mallika Kaviratne 177,480 0.1%
Total - 177,480 0.1%
This irrevocable undertaking remains binding in the event a higher competing
offer is made for Medica and will only cease to be binding if:
· the Scheme Document is not sent to Medica
Shareholders within 28 days (or such longer period as Medica and Bidco agree,
and the Panel consent);
· where Bidco has elected (in accordance with and
subject to the terms of the Co-operation Agreement and with Panel consent) to
proceed with the implementation of the Acquisition by way of a Takeover Offer
and the Offer Document is not sent to Medica Shareholders within 28 days;
· Bidco announces, with consent of the Panel, that it
does not intend to make or proceed with the Acquisition and no new, revised or
replacement Takeover Offer or Scheme is announced by Bidco in accordance with
Rule 2.7 of the Takeover Code at the same time;
· the Scheme (or Takeover Offer, as applicable)
lapses or is withdrawn in accordance with its terms and no new, revised or
replacement Takeover Offer or Scheme is announced by Bidco by such time;
· the Acquisition has not become effective or, in the
event Bidco has elected (in accordance with and subject to the terms of the
Co-operation Agreement and with Panel consent) to proceed with the
implementation of the Acquisition by way of a Takeover Offer, the Takeover
Offer has not become unconditional, in each case by the Long Stop Date; or
· the date on which any competing offer for the
entire issued and to be issued share capital of Medica is declared
unconditional (if implemented by way of a takeover offer) or, if proceeding by
way of a scheme of arrangement, becomes effective.
Irrevocable undertaking of other shareholders
The following holders, controllers and/or beneficial owners of Medica Shares
have given an irrevocable undertaking to vote in favour, or procure the
registered holder votes in favour, of the Scheme at the Court Meeting and the
Resolutions to be proposed at the General Meeting and, if Bidco exercises its
right to implement the Acquisition by way of a Takeover Offer, to accept or
procure acceptance of such Takeover Offer:
Discretionary Manager Registered Holder Total Number of Medica Shares Percentage of existing issued share capital of Medica
Gresham House Asset Management Ltd Strategic Equity Capital plc 14,506,275 11.8%
Gresham House Asset Management Ltd LF Gresham House UK Micro Cap Fund 6,316,145 5.2%
Gresham House Asset Management Ltd LF Gresham House UK Smaller Companies Fund 2,043,298 1.7%
Gresham House Asset Management Ltd IFSL Avellemy UK European Equity Fund 1,313,465 1.1%
Total - 24,179,183 19.7%
These irrevocable undertakings will only cease to be binding if:
· the Scheme Document or Offer Document (as the case
may be) is not sent to Medica Shareholders within 28 days of the date of this
Announcement;
· the Scheme (or Takeover Offer, as applicable)
lapses or is withdrawn in accordance with its terms (except if the Scheme
lapses or is withdrawn if Bidco elects to switch from a Scheme to a Takeover
Offer in order to implement the Acquisition); or
· a third party (other than a company controlled by
Bidco) announces an offer (whether by way of a scheme of arrangement or offer)
for the entire issued share capital of Medica at a price of not less than
222.6 pence per ordinary share of Medica for the purposes of Rule 2.7 of the
Takeover Code.
Appendix 4
DEFINITIONS
The following definitions apply throughout this Announcement unless the
context requires otherwise:
"2022 Final
Dividend"
the final dividend in respect of Medica's 2022 financial year of 1.88 pence in
cash per Medica Share which was proposed by the Medica Directors on 29 March
2023 in Medica's results for the year ended 31 December 2022;
"Acquisition"
the proposed acquisition by Bidco of the entire issued, and to be issued,
ordinary share capital of Medica, other than Excluded Shares, to be
implemented by means of the Scheme (or should Bidco elect (subject to the
consent of the Panel and the terms of the Co-operation Agreement) by means of
a Takeover Offer) and, where the context requires, any subsequent revision,
variation, extension or renewal thereof;
"Announcement"
this announcement (including the summary and Appendices to this announcement);
"Authorisations"
authorisations, orders, determinations, grants, recognitions, confirmations,
consents, licences, clearances, certificates, permissions, exemptions or
approvals, in each case of a Third Party;
"Bidco"
Moonlight Bidco Limited;
"Bidco
Group"
Topco and its subsidiary undertakings;
"Business
Day"
a day, not being a public holiday, Saturday or Sunday, on which clearing banks
in London are open for normal business;
"Closing
Price"
the closing middle market price of a Medica Share as derived from the Daily
Official List on any particular date;
"Co-operation
Agreement"
the co-operation agreement entered into between Bidco and Medica dated 24
April 2023 relating to, amongst other things, the implementation of the
Acquisition;
"Companies
Act"
the Companies Act 2006, as amended;
"Conditions"
the conditions to the Acquisition, as set out in Appendix 1 to this
Announcement and to be set out in the Scheme Document and "Condition" shall
mean any one of them;
"Confidentiality
Agreement"
the confidentiality agreement entered into between IK and Medica dated 28
February 2023 in respect of the Acquisition;
"Consideration"
the consideration payable to Medica Shareholders pursuant to the Acquisition,
comprising 212 pence in cash per Medica Share;
"Court"
the High Court of Justice in England and Wales;
"Court
Meeting"
the meeting of Scheme Shareholders to be convened at the direction of the
Court pursuant to Part 26 of the Companies Act for the purpose of considering
and, if thought fit, approving the Scheme (with or without amendment), and
including any adjournment, postponement or reconvening thereof, notice of
which is to be contained in the Scheme Document;
"Court
Order"
the order of the Court sanctioning the Scheme under Part 26 of the Companies
Act;
"CREST"
the relevant system (as defined in the CREST Regulations) in respect of which
Euroclear is the operator (as defined in the CREST Regulations) in accordance
with which securities may be held and transferred in uncertificated form;
"CREST
Regulations"
the Uncertificated Securities Regulations 2001 (SI 2001 No. 3755) (including
as it forms part of domestic law of the United Kingdom by virtue of the
European Union (Withdrawal) Act 2018), as amended from time to time;
"Daily Official
List"
the Daily Official List published by the London Stock Exchange;
"Disclosed"
the information fairly disclosed by, or on behalf of Medica: (i) in its 2022
preliminary results statement on 29 March 2023 for the financial year ended 31
December 2022; (ii) in this Announcement; and (iii) in any other announcement
to a Regulatory Information Service by, or on behalf of Medica before the
publication of this Announcement;
"Effective"
in the context of the Acquisition: (i) if the Acquisition is implemented by
way of the Scheme, the Scheme having become effective pursuant to its terms;
or (ii) if the Acquisition is implemented by way of a Takeover Offer, the
Takeover Offer having been declared or having become unconditional in
accordance with the requirements of the Takeover Code;
"Effective
Date"
the date on which the Acquisition becomes Effective;
"Euroclear"
Euroclear UK & International Limited;
"Evercore"
Evercore Partners International LLP;
"Excluded
Shares"
any Medica Shares at the Scheme Record Time which (if any):
(a) are owned or controlled by the Bidco Group; or
(b) are held by Medica as treasury shares (within the
meaning of the Companies Act);
"FCA" or "Financial Conduct Authority" the
Financial Conduct Authority of the United Kingdom or its successor from time
to time, acting in its capacity as the competent authority for the purposes of
Part VI of FSMA;
"FCA
Handbook"
the FCA's Handbook of rules and guidance as amended from time to time;
"Forms of
Proxy"
the forms of proxy for use at the Court Meeting and the General Meeting which
will accompany the Scheme Document;
"FSMA"
the Financial Services and Markets Act 2000, as amended from time to time;
"General
Meeting"
the general meeting of Medica Shareholders to be convened in connection with
the Scheme to consider and, if thought fit, to approve the Resolutions (with
or without amendment), which is expected to be held as soon as the preceding
Court Meeting shall have concluded or been adjourned, and including any
adjournment, postponement or reconvening thereof;
"IK"
IK Investment Partners Limited (acting in the capacity as adviser to the IK
Funds);
"IK
Funds"
(a) IK IX Fund No.1 SCSp; and
(b) IK IX Fund No.2 SCSp;
"Latest Practicable
Date"
has the meaning given to it in paragraph 1 of Appendix 2 to this Announcement;
"Lenders"
Barings Global Private Loans 4 S.à r.l., Barings Global Private Loans 4(S)
S.à r.l., Barings European Private Loans 3 S.à r.l., Barings European
Private Loans 3A S.à r.l., Barings Segregated Direct Lending HoldCo 1 S.à
r.l., Barings Segregated Direct Lending HoldCo 2 S.à r.l., Barings BDC, Inc.,
Barings Capital Investment Corporation, Barings Private Credit Corporation and
Massachusetts Mutual Life Insurance Company;
"Liberum"
Liberum Capital Limited;
"Listing
Rules"
the rules and regulations made by the FCA under FSMA, and contained in the
FCA's publication of the same name;
"London Stock
Exchange"
London Stock Exchange plc or its successor;
"Long Stop
Date"
31 August 2023 (or such later date as Medica and Bidco may, with the consent
of the Panel, agree and, if required, as the Court may approve);
"Main
Market"
the main market for trading in listed securities operated by the London Stock
Exchange;
"Medica"
Medica Group plc;
"Medica
Articles"
the articles of association of Medica as amended from time to time;
"Medica
Directors"
the directors of Medica at the time of this Announcement or, where the context
so requires, the directors of Medica from time to time;
"Medica Profit
Forecasts"
the Medica profit forecasts, as set out in Appendix 5 to this Announcement;
"Medica Share
Plans"
(a) the Medica Group plc Company Share Option Plan;
(b) the Medica Group plc Deferred Bonus Plan;
(c) the Medica Group plc 2018 Performance Share Plan;
and
(d) the Medica Group plc all-employee Sharesave Scheme;
"Medica
Shareholders"
holders of Medica Shares;
"Medica
Shares"
the ordinary shares of 0.2 pence each in the share capital of Medica from time
to time;
"Meetings"
the Court Meeting and/or the General Meeting, as the case may be;
"Numis"
Numis Securities Limited;
"Offer
Document"
should the Acquisition be implemented by way of a Takeover Offer, the document
which would be sent to Medica Shareholders containing, amongst other things,
the terms and conditions of the Takeover Offer;
"Offer
Period"
the offer period (as defined by the Takeover Code) relating to Medica, which
commenced on 24 April 2023 (being the date of this Announcement) and ending on
the earlier of: (i) the Effective Date and/or (ii) the date on which the
Scheme lapses or is withdrawn (or such other date as the Takeover Code may
provide or the Panel may decide);
"Official
List"
the Official List of the FCA;
"Opening Position
Disclosure"
has the same meaning given to it in Rule 8 of the Takeover Code;
"Overseas
Shareholders"
holders of Scheme Shares who are resident in, ordinarily resident in, or
citizens of, jurisdictions outside the United Kingdom;
"Panel"
the Panel on Takeovers and Mergers;
"Registrar of
Companies"
the Registrar of Companies in England and Wales;
"Regulatory Information
Service" a regulatory
information service as defined in the FCA Handbook;
"relevant
securities"
"relevant securities" as defined in the Takeover Code;
"Resolutions"
the resolution(s) to be proposed at the General Meeting necessary to
facilitate the implementation of the Scheme, including, without limitation, a
resolution to amend the Medica Articles by adoption and inclusion of a new
article (in terms approved by Bidco) under which any Medica Shares issued or
transferred after the Scheme Record Time (other than to Bidco and its
nominees) shall be automatically transferred to Bidco (or as it may direct)
and, where applicable, for Consideration to be paid to the transferee or to
the original recipient of the Medica Shares so transferred or issued on the
same terms as the Acquisition (other than terms as to timings and
formalities);
"Restricted
Jurisdiction"
any jurisdiction where local laws or regulations may result in a significant
risk of civil, regulatory or criminal exposure if information concerning the
Acquisition (including this Announcement) is sent or made available to Medica
Shareholders in that jurisdiction;
"Sanction
Hearing"
the Court hearing to sanction the Scheme under Part 26 of the Companies Act;
"Scheme"
the proposed scheme of arrangement under Part 26 of the Companies Act between
Medica and Scheme Shareholders, with or subject to any modification, addition
or condition approved or imposed by the Court and agreed by Medica and Bidco,
to implement the acquisition of the entire issued and to be issued share
capital of Medica by Bidco;
"Scheme
Document"
the document to be sent to Medica Shareholders containing, amongst other
things, the Scheme and the notices convening the Court Meeting and the General
Meeting;
"Scheme Record
Time"
the time and date to be specified in the Scheme Document as being the record
time for the Scheme, expected to be 6.00 p.m. on the Business Day immediately
prior to the Effective Date, or such later time as Bidco and Medica may agree;
"Scheme
Shareholders"
holders of Scheme Shares;
"Scheme
Shares"
all Medica Shares which remain in issue at the Scheme Record Time and are:
(a) in issue at the date of the Scheme Document;
(b) (if any) issued after the date of the Scheme Document
but before the Voting Record Time; and/or
(c) (if any) issued at or after the Voting Record Time
and before the Scheme Record Time, either on terms that the original or any
subsequent holders thereof shall be bound by the Scheme or in respect of which
the holders thereof shall have agreed in writing to be bound by the Scheme,
excluding, in each case, any Excluded Shares;
"Significant
Interest"
in relation to an undertaking, a direct or indirect interest in 20 per cent.
or more of the total voting rights or equity share capital of such
undertaking;
"Takeover
Code"
the Takeover Code issued by the Panel, as amended from time to time;
"Takeover
Offer"
subject to the consent of the Panel and the terms of the Co-operation
Agreement, should the Acquisition be implemented by way of a takeover offer as
defined in Chapter 3 of Part 28 of the Companies Act, the offer to be made by
or on behalf of Bidco to acquire the entire issued and to be issued share
capital of Medica, other than Excluded Shares and, where the context admits,
any subsequent revision, variation, extension or renewal of such offer;
"Third
Party"
any relevant central bank, government or governmental, quasi-governmental,
supranational, statutory, regulatory, environmental, administrative, fiscal or
investigative body, court, trade agency, association, institution,
environmental body, employee representative body, any entity owned or
controlled by any relevant government or state, or any other body or person
whatsoever in any jurisdiction;
"Topco"
Moonlight Topco Limited;
"UK" or "United
Kingdom"
United Kingdom of Great Britain and Northern Ireland;
"US" or "United
States"
the United States of America, its territories and possessions, any state of
the United States of America, the District of Columbia and all other areas
subject to its jurisdiction and any political sub-division thereof;
"US Exchange
Act"
the United States Securities Exchange Act of 1934, as amended, and the rules
and regulations promulgated thereunder;
"Voting Record
Time"
the time and date to be specified in the Scheme Document by reference to which
entitlement to vote at the Court Meeting and the General Meeting will be
determined, expected to be 6.00 p.m. on the day which is two Business Days
before the date of the Court Meeting and the General Meeting or, if the Court
Meeting and/or the General Meeting is adjourned, 6.00 p.m. on the day which is
two Business Days before the date of such adjourned Meeting;
"Wider Bidco
Group"
Bidco, funds advised by IK and each of their respective subsidiary
undertakings, associated undertakings, and any other undertaking (including
any joint venture, partnership, firm or company) in which Bidco and/or all
such undertakings (aggregating their interests) have a Significant Interest;
and
"Wider Medica
Group"
Medica and its subsidiary undertakings, associated undertakings, and any other
undertaking (including any joint venture, partnership, firm or company) in
which Medica and/or all such undertakings (aggregating their interests) have a
Significant Interest.
For the purposes of this Announcement, "subsidiary", "subsidiary undertaking",
"undertaking", "associated undertaking" and "equity share capital" have the
meanings given by the Companies Act.
All references to "pounds", "pounds Sterling", "Sterling", "£", "pence",
"penny" and "p" are to the lawful currency of the United Kingdom.
All times referred to in this Announcement are London times unless otherwise
stated.
References to the singular include the plural and vice versa.
All references to statutory provisions or law or to any order or regulation
shall be construed as a reference to that provision, law, order or regulation
as extended, modified, replaced or re-enacted from time to time and all
statutory instruments, regulations and orders from time to time made
thereunder or deriving validity therefrom.
Appendix 5
MEDICA PROFIT FORECASTS
As part of its 2022 preliminary results statement on 29 March 2023, Medica
published the following table:
Progress against our strategic financial goals
Strategic financial target¹ Medium term Target Actual FY 2022
Revenue growth rate
UK 12%-14% 15%
Ireland >15% 30%
US² >15% 63%
Target Margins
Gross Profit Margin >45% 48%
Underlying Net Operating Profit margin 20% 18%
Return on Capital Employed³
Group >20% 20%
Ireland >15% 20%
US >15% 14%
Group Operating Cash conversion >80% 64%
¹ Non-GAAP unaudited operational performance measures as set out
in the CMD presentation in September 2021
² YoY comparison including periods pre-acquisition
³ Defined as underlying operating profit (excluding PLC costs)
divided by total assets less current liabilities and long-term debt
Application of Rule 28 to the Medica Profit Forecasts
When taken together, the statements in table with respect to revenue growth
rates and target margins can be used to estimate Underlying Net Operating
Profit for a period under 15 months and for a period over 15 months from the
date published, which for the purposes of Rule 28.1 and Rule 28.2 of the
Takeover Code, constitute profit forecasts (together, the "Medica Profit
Forecasts").
Directors' confirmation
The directors of Medica confirm that, as at the date of this Announcement, the
Medica Profit Forecasts remain valid and that they have been properly compiled
on the basis of the assumptions stated below and that the basis of accounting
used is consistent with Medica's accounting policies which are in accordance
with International Financial Reporting Standards and those that Medica applied
in preparing its financial statements for the year ended 31 December 2022.
Further information on the basis of preparation of the Medica Profit
Forecasts, including the principal assumptions on which they are based, is set
out below.
Basis of preparation and principal assumptions
The Medica Profit Forecasts are based on the assumptions listed below.
Factors outside the influence or control of the directors of Medica
· There will be no material changes to existing
prevailing macroeconomic or political conditions in the markets and regions in
which Medica operates.
· There will be no material changes in market
conditions in relation to either customer demand, radiologist recruitment and
capacity or competitive environment.
· The interest, inflation and tax rates in the
markets and regions in which Medica operates will remain materially unchanged
from the prevailing rates.
· There will be no material adverse events that will
have a significant impact on Medica's financial performance.
· There will be no business disruptions that
materially affect Medica or its key customers, including natural disasters,
acts of terrorism, technological issues or supply chain disruptions.
· There will be no material changes to the prevailing
foreign exchange rates that will have a significant impact on Medica's revenue
or cost base.
· There will be no material changes in legislation or
regulatory requirements impacting on Medica's operations or on its accounting
policies.
· There will be no material litigation in relation to
any of Medica's operations.
Factors within the influence or control of the directors of Medica
· There will be no material change to the present
executive management of Medica.
· There will be no material change in the operational
strategy of Medica.
· There will be no material adverse change in
Medica's ability to maintain customer, radiologist and partner relationships.
· There will be no material acquisitions or
disposals.
· There will be no material strategic investments
over and above those currently planned.
· There will be no material change in the dividend or
capital allocation policies of Medica.
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