REG - Pennon Group PLC - Retail Offer by PrimaryBid

PennonAnnouncement

10/01/2024 07:15

For best results when printing this announcement, please click on link below:
http://newsfile.refinitiv.com/getnewsfile/v1/story?guid=urn:newsml:reuters.com:20240110:nRSJ1682Za&default-theme=true

RNS Number : 1682Z  Pennon Group PLC  10 January 2024

THIS ANNOUNCEMENT, INCLUDING THE INFORMATION CONTAINED HEREIN, IS RESTRICTED
AND NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN WHOLE OR IN PART,
DIRECTLY OR INDIRECTLY, IN, INTO OR FROM THE UNITED STATES, AUSTRALIA, CANADA,
JAPAN, SOUTH AFRICA OR ANY OTHER JURISDICTION WHERE TO DO SO WOULD CONSTITUTE
A VIOLATION OF THE RELEVANT LAWS OR REGULATIONS OF THAT JURISDICTION. PLEASE
SEE THE IMPORTANT NOTICE AT THE END OF THIS ANOUNCEMENT.  FURTHER, THIS
ANNOUNCEMENT IS FOR INFORMATION PURPOSES ONLY AND IS NOT AN OFFER OF
SECURITIES IN ANY JURISDICTION.

THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION AS STIPULATED UNDER THE MARKET
ABUSE REGULATION (EU) NO. 596/2014 AS IT FORMS PART OF UK LAW BY VIRTUE OF THE
EUROPEAN UNION (WITHDRAWAL) ACT 2018, AS AMENDED.

THIS ANNOUNCEMENT AMOUNTS TO A FINANCIAL PROMOTION FOR THE PURPOSES OF SECTION
21 OF THE FINANCIAL SERVICES AND MARKETS ACT 2000 ("FSMA") AND HAS BEEN
APPROVED BY PRIMARYBID LIMITED WHICH IS AUTHORISED AND REGULATED BY THE
FINANCIAL CONDUCT AUTHORITY (FRN 779021).

FOR IMMEDIATE RELEASE

10 January 2024

Pennon Group plc

("Pennon", the "Group" or the "Company")

Retail Offer by PrimaryBid

Pennon is pleased to announce a conditional retail offer via PrimaryBid of new
ordinary shares of 61.05 pence each in the capital of the Company (the "Retail
Offer Shares" and the "Retail Offer").

The Retail Offer is open to new and existing investors in the UK, including
WaterShare+ customers in the UK and Company employees. Further details of the
Retail Offer, including how to participate, can be found below.

As separately announced today, the Company is conducting a non-pre-emptive
placing of new ordinary shares of 61.05 pence each (the "Placing Shares") in
the capital of the Company to both existing institutional shareholders and new
institutional investors (the "Placing") through an accelerated bookbuilding
process (the "Bookbuilding Process"). The price at which the Placing Shares
are to be placed (the "Offer Price") will be determined at the close of the
Bookbuilding Process. In addition to the Placing and the Retail Offer, certain
directors and executives of the Company intend to subscribe for new ordinary
shares of 61.05 pence each in the capital of the Company (the "Subscription
Shares") (the "Subscription", together with the Placing and the Retail Offer,
the "Equity Capital Raise").

The issue price for the Retail Offer Shares, as well as the Subscription
Shares, will be equal to the Offer Price.

Reasons for the Retail Offer

As announced separately today, Pennon has acquired 100% of the issued capital
of Sumisho Osaka Gas Water UK Limited, the holding company of Sutton and East
Surrey Water plc and certain other ancillary businesses, for £89 million from
Sumitomo Corporation and Osaka Gas, with a total enterprise value of £380
million (the "Acquisition"). Further information can be found in the
Acquisition announcement released separately by the Company today. Pennon is
launching an Equity Capital Raise of up to £180 million in aggregate in
connection with the Acquisition, in order to ensure that the pro forma
leverage and capital structure for the enlarged Group following the
Acquisition remains consistent with Pennon's well-established water business
gearing range of 55-65%((1)).

Prior to launch of the Equity Capital Raise, the Company consulted with a
significant number of its shareholders to assess their feedback as to the
purpose of the Equity Capital Raise. Feedback from this consultation was
supportive and as a result the Board has concluded that the Equity Capital
Raise, including the Retail Offer, is in the best interests of shareholders
and wider stakeholders and will promote the long-term success of the Company.
Accordingly, the Company has chosen to proceed with the Retail Offer.

The Company values its retail investor base and is therefore pleased to
provide retail investors with the opportunity to participate in the Retail
Offer.

Details of the Retail Offer

Members of the public in the UK can access the Retail Offer through
PrimaryBid's website
(https://app.primarybid.com/?utm_source=rns&utm_medium=referral&utm_campaign=Hydros)
and on PrimaryBid's app
(https://primarybid.com/uk/get-the-app/?utm_source=rns&utm_medium=referral&utm_campaign=Hydros)
. The PrimaryBid app is available on the UK Apple App Store and Google Play
Store.

Investors can also participate through PrimaryBid's extensive partner network
of investment platforms, retail brokers and wealth managers, subject to such
partners' participation. Participating partners include:

·      AJ Bell;

·      Hargreaves Lansdown; and

·      interactive investor.

Applications for Retail Offer Shares through participating partners can be
made from tax efficient savings vehicles such as ISAs or SIPPs, as well as
GIAs. Some partners may only accept applications from existing shareholders.

WaterShare+ customers in the UK can participate in the Equity Capital Raise
through the Retail Offer by applying through PrimaryBid's website
(https://app.primarybid.com/?utm_source=rns&utm_medium=referral&utm_campaign=Hydros)
and on PrimaryBid's app
(https://primarybid.com/uk/get-the-app/?utm_source=rns&utm_medium=referral&utm_campaign=Hydros)
available on the Apple App Store and Google Play.

The Retail Offer will be open to retail investors following publication of
this announcement. The Retail Offer will close at the same time as the
Bookbuilding Process is completed. The Retail Offer may close early if it is
oversubscribed.

Subscriptions under the Retail Offer will be considered by the Company with
preference to be given to the Company's existing retail investors. The issue
price for the Retail Offer Shares will be equal to the Offer Price and there
is a minimum subscription of £250 per investor under the terms of the Retail
Offer. The Company reserves the right to scale back any order at its
discretion. The Company and PrimaryBid reserve the right to reject any
application for subscription under the Offer without giving any reason for
such rejection.

Investors who apply for Retail Offer Shares through PrimaryBid's website or
PrimaryBid's app will not be charged any fee or commission by PrimaryBid. It
is vital to note that once an application for Retail Offer Shares has been
made and accepted via PrimaryBid, that application cannot be withdrawn.

Investors wishing to apply for Retail Offer Shares through their investment
platform, retail broker or wealth manager using their ISA, SIPP or GIA should
contact them for details of their terms and conditions, process and any
relevant fees or charges.

It is important to note that once an application for the Retail Offer Shares
has been made and accepted via PrimaryBid, that application is irrevocable and
cannot be withdrawn.

It is a term of the Retail Offer that the total value of the Retail Offer
Shares available for subscription at the Offer Price does not exceed €8
million equivalent. Accordingly, the Company is not required to publish (and
has not published) a prospectus in connection with the Retail Offer as it
falls within the exemption set out in sections 86(1)(e) and 86(4) of FSMA. The
Retail Offer is only being made in the United Kingdom and is not being made
into any jurisdiction where it would be unlawful to do so. In particular, the
Retail Offer is being made only to persons who are, and at the time the Retail
Offer Shares are subscribed for, will be outside the United States and
subscribing for the Retail Offer Shares in an "offshore transaction" as
defined in, and in accordance with, Regulation S under the U.S. Securities Act
of 1933, as amended (the "Securities Act"). Persons who are resident or
otherwise located in the United States will not be eligible to register for
participation in the offer through PrimaryBid or subscribe for Retail Offer
Shares.

The Retail Offer Shares, if issued, will be fully paid and free of all liens,
charges and encumbrances, and will rank pari passu in all respects with the
existing ordinary shares of the Company, the Placing Shares and the
Subscription Shares, including the right to receive all dividends and other
distributions declared, made or paid after the date of issue.

Applications will be made (i) to the Financial Conduct Authority (the "FCA")
for admission of the Placing Shares, the Retail Offer Shares and the
Subscription Shares to the premium listing segment of the Official List; and
(ii) the London Stock Exchange plc for admission of the Placing Shares, the
Retail Offer Shares and the Subscription Shares to trading on its Main Market
for listed securities (together, "Admission").

Admission and settlement of the Retail Offer Shares are expected to take place
on or before 8.00 a.m. on 12 January 2024. The Retail Offer is conditional,
among other things, upon Admission of the Placing Shares becoming effective
and the placing agreement entered into by the Company in connection with the
Placing not being terminated in accordance with its terms. The Retail Offer
will not be completed without the Placing also being completed.

For further information on PrimaryBid, the PrimaryBid Offer or for a copy of
the terms and conditions (including the procedure for application and payment
for new Ordinary Shares) that apply to registered users of PrimaryBid in
addition to the terms and conditions set out in this Announcement,
visit www.PrimaryBid.com (http://www.primarybid.com/) or email PrimaryBid at
enquiries@primarybid.com (http://enquiries@primarybid.com) .

Brokers wishing to offer their customers access to the Retail Offer and future
PrimaryBid transactions, should contact partners@primarybid.com
(http://partners@primarybid.com) .

It should be noted that a subscription for the Retail Offer Shares and any
investment in the Company carry a number of risks. Investors should make their
own investigations into the merits of an investment in the Company. In
particular, investors should consider the risk factors set out on
www.PrimaryBid.com before making a decision to subscribe for Retail Offer
Shares. Nothing in this announcement amounts to a recommendation to invest in
the Company or amounts to investment, taxation or legal advice. Investors
should take independent advice from a person experienced in advising on
investment in securities such as the Company's ordinary shares if they are in
any doubt.

This announcement should be read in its entirety. In particular, you should
read and understand the information provided in the "Important Notices"
section of this announcement.

The person responsible for releasing this announcement is Andrew Garard, Group
General Counsel and Company Secretary.

For further information, please contact:

 

 Pennon Group plc
 Steve Buck          Group Chief Financial Officer      +44 (0)1392 44 3168

Jennifer Cooke
Group Head of Investor Relations
 PrimaryBid Limited
 Nick Smith                                             enquiries@primarybid.com (mailto:enquiries@primarybid.com)

James Deal
 Media Enquiries
 James Murgatroyd    FGS Global                         +44 (0)207 251 3801

Harry Worthington

 

Notes:

((1)) Gearing at the regulated water business level, defined as net debt /
RCV((2)).

((2)) RCV (Regulatory Capital Value) is a measure of a company's market value
plus the value of accumulated capital investment.

 

Important Notices

This announcement has been issued by and is the sole responsibility of the
Company.

Persons distributing this announcement must satisfy themselves that it is
lawful to do so. This announcement is for information purposes only and shall
not constitute an offer to sell or issue or the solicitation of an offer to
buy, subscribe for or otherwise acquire securities in any jurisdiction in
which any such offer or solicitation would be unlawful. Any failure to comply
with this restriction may constitute a violation of the securities laws of
such jurisdictions. Persons needing advice should consult an independent
financial adviser.

The distribution of this announcement and the offering, placing and/or issue
of the Retail Offer Shares in certain jurisdictions may be restricted by law.
No action has been taken by the Company, PrimaryBid or any of their respective
affiliates, or any person acting on any of their behalves, that would permit
an offer of the Retail Offer Shares or possession or distribution of this
announcement or any other offering or publicity material relating to such
Retail Offer Shares in any jurisdiction where action for that purpose is
required. Persons into whose possession this announcement comes are required
by the Company to inform themselves about, and to observe, such restrictions.

No offering document or prospectus will be made available in connection with
the matters contained in this announcement and no such prospectus is required
to be published in accordance with the Prospectus Regulation (EU) 2017/1129
(as it forms part of English law pursuant to the European Union (Withdrawal)
Act 2018 (as amended)).

THIS ANNOUNCEMENT, AND THE INFORMATION CONTAINED HEREIN, IS RESTRICTED AND NOT
FOR RELEASE, PUBLICATION, TRANSMISSION, FORWARDING OR DISTRIBUTION, IN WHOLE
OR IN PART, DIRECTLY OR INDIRECTLY, IN OR INTO THE UNITED STATES OF AMERICA,
ITS TERRITORIES AND POSSESSIONS, ANY STATE OF THE UNITED STATES OR THE
DISTRICT OF COLUMBIA (COLLECTIVELY, THE "UNITED STATES"), AUSTRALIA, CANADA,
THE REPUBLIC OF SOUTH AFRICA, JAPAN OR ANY OTHER JURISDICTION IN WHICH SUCH
RELEASE, PUBLICATION, TRANSMISSION, FORWARDING OR DISTRIBUTION WOULD BE
UNLAWFUL. FURTHER, THIS ANNOUNCEMENT IS FOR INFORMATION PURPOSES ONLY AND IS
NOT AN OFFER OF SECURITIES IN ANY JURISDICTION. THIS ANNOUNCEMENT HAS NOT BEEN
APPROVED BY THE LONDON STOCK EXCHANGE, NOR IS IT INTENDED THAT IT WILL BE SO
APPROVED.

This announcement is for information purposes only and is not intended to and
does not constitute or form part of any offer or invitation to issue or sell,
or the solicitation of an offer to acquire, purchase or subscribe for, any
securities in the United States, Canada, Australia, the Republic of South
Africa, Japan or any other jurisdiction in which the same would be unlawful.
No public offering of the securities referred to herein is being made in any
such jurisdiction.

The securities referred to herein have not been and will not be registered
under the Securities Act, or under the securities laws of any state or other
jurisdiction of the United States, and may not be offered, sold, pledged,
taken up, exercised, resold, renounced, transferred, or delivered, directly or
indirectly, in or into the United States absent registration under the
Securities Act, except pursuant to an exemption from, or in a transaction not
subject to, the registration requirements of the Securities Act and in
compliance with any applicable securities laws of any state or any other
jurisdiction of the United States.  No public offering of the Retail Offer
Shares, the Placing Shares or any other securities is being made in the United
States.

The relevant clearances have not been, nor will they be, obtained from the
securities commission of any province or territory of Canada; no prospectus
has been or will be lodged with, or registered by, the Australian Securities
and Investments Commission or the Japanese Ministry of Finance; and the Retail
Offer Shares have not been, and nor will they be, registered under or offered
in compliance with the securities laws of any state, province or territory of
Canada, Australia, the Republic of South Africa or Japan. Accordingly, the
Retail Offer Shares may not (unless an exemption under the relevant securities
laws is applicable) be offered, sold, resold or delivered, directly or
indirectly, in or into Canada, Australia, the Republic of South Africa, Japan
or any other jurisdiction outside the United Kingdom or to, or for the account
or benefit of any national, resident or citizen of Australia, the Republic of
South Africa, Japan or to any investor located or resident in Canada.

Certain statements contained in this announcement constitute "forward-looking
statements" with respect to the financial condition, performance, strategic
initiatives, objectives, results of operations and business of the Company.
All statements other than statements of historical facts included in this
announcement are, or may be deemed to be, forward-looking statements. Without
limitation, any statements preceded or followed by or that include the words
"targets", "plans", "believes", "expects", "aims", "intends", "anticipates",
"estimates", "projects", "will", "may", "would", "could" or "should", or words
or terms of similar substance or the negative thereof, are forward-looking
statements. Forward-looking statements 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; and (ii) business and management
strategies and the expansion and growth of the Company's operations. Such
forward-looking statements involve risks and uncertainties that could
significantly affect expected results and are based on certain key
assumptions. Many factors could cause actual results, performance or
achievements to differ materially from those projected or implied in any
forward-looking statements. The important factors that could cause the
Company's actual results, performance or achievements to differ materially
from those in the forward-looking statements include, among others, the
macroeconomic and other impacts of COVID-19, economic and business cycles, the
terms and conditions of the Company's financing arrangements, foreign currency
rate fluctuations, competition in the Company's principal markets,
acquisitions or disposals of businesses or assets and trends in the Company's
principal industries. Due to such uncertainties and risks, readers are
cautioned not to place undue reliance on such forward-looking statements,
which speak only as of the date hereof. In light of these risks, uncertainties
and assumptions, the events described in the forward-looking statements in
this announcement may not occur. The forward-looking statements contained in
this announcement speak only as of the date of this announcement. The Company
and its directors each expressly disclaim any obligation or undertaking to
update or revise publicly any forward-looking statements, whether as a result
of new information, future events or otherwise, unless required to do so by
applicable law or regulation (including the rules of the London Stock Exchange
or the Financial Conduct Authority).

This announcement does not constitute a recommendation concerning any
investor's investment decision with respect to the Retail Offer. Any
indication in this announcement of the price at which ordinary shares have
been bought or sold in the past cannot be relied upon as a guide to future
performance. The price of shares and any income expected from them may go down
as well as up and investors may not get back the full amount invested upon
disposal of the shares. Past performance is no guide to future performance.
The contents of this announcement are not to be construed as legal, business,
financial or tax advice. Each investor or prospective investor should consult
his, her or its own legal adviser, business adviser, financial adviser or tax
adviser for legal, financial, business or tax advice.

No statement in this announcement is intended as a profit forecast or estimate
for any period and no statement in this announcement should be interpreted to
mean that earnings, earnings per share or income, cash flow from operations or
free cash flow for the Company, as appropriate, for the current or future
years would necessarily match or exceed the historical published earnings,
earnings per share or income, cash flow from operations or free cash flow for
the Company.

The Retail Offer Shares to be issued or sold pursuant to the Retail Offer will
not be admitted to trading on any stock exchange other than the London Stock
Exchange.

Neither the content of the Company's website (or any other website) nor the
content of any website accessible from hyperlinks on the Company's website (or
any other website) is incorporated into or forms part of this announcement.

This announcement has been prepared for the purposes of complying with
applicable law and regulation in the United Kingdom and the 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 and regulations of
any jurisdiction outside the United Kingdom.

If you are in any doubt about the contents of this announcement you should
consult your stockbroker, bank manager, solicitor, accountant or other
financial adviser.

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

RNS may use your IP address to confirm compliance with the terms and conditions, to analyse how you engage with the information contained in this communication, and to share such analysis on an anonymised basis with others as part of our commercial services. For further information about how RNS and the London Stock Exchange use the personal data you provide us, please see our
Privacy Policy (https://www.lseg.com/privacy-and-cookie-policy)
.   END  IOEQKCBPBBKBPDK