REG - Science in Sport PLC - Recommended Cash Acquisition
17/04/2025 14:45
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RNS Number : 5207F Science in Sport PLC 17 April 2025
NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN WHOLE OR IN PART, DIRECTLY OR
INDIRECTLY, IN, INTO OR FROM ANY JURISDICTION WHERE TO DO SO WOULD CONSTITUTE
A VIOLATION OF THE RELEVANT LAWS OR REGULATIONS OF SUCH JURISDICTION
THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION
FOR IMMEDIATE RELEASE
17 April 2025
RECOMMENDED CASH ACQUISITION
of
Science in Sport plc ("SiS")
by
Einstein Bidco Limited ("Bidco")
a newly formed company indirectly wholly-owned by funds advised by bd-capital
Partners Limited ("bd-capital")
to be effected by means of a scheme of arrangement
under Part 26 of the UK Companies Act 2006
Summary
· Further to the announcement by SiS on 16 April 2025 relating to
the advanced discussions between bd-capital and SiS in respect of a possible
cash offer for SiS, the board of directors of Bidco and the SiS Independent
Directors are pleased to announce that they have reached agreement on the
terms of a recommended all cash acquisition by Bidco of the entire issued and
to be issued ordinary share capital of SiS (the "Acquisition").
· Under the terms of the Acquisition, which will be subject to the
Conditions and further terms set out in Appendix I to this Announcement and to
the full terms and conditions which will be set out in the Scheme Document,
each Scheme Shareholder at the Scheme Record Time will be entitled to receive:
for each Scheme Share: 34 pence in cash
· The Acquisition Price represents an attractive premium of
approximately:
· 23.6 per cent. to the Closing Price of 27.5 pence per SiS Share
on 15 April 2025 (being the last Business Day prior to the commencement of the
Offer Period);
· 28.8 per cent. to the sixth-month Volume Weighted Average Price
of 26.4 pence per SiS Share on 15 April 2025 (being the last Business Day
prior to the commencement of the Offer Period);
· 44.7 per cent. to the twelve-month Volume Weighted Average Price
of 23.5 pence per SiS Share on 15 April 2025 (being the last Business Day
prior to the commencement of the Offer Period); and
· 100 per cent. to the issue price of 17 pence at which SiS raised
approximately £8.5 million in July 2024 via a Placing and Retail Offer of SiS
Shares.
· The Acquisition values the entire issued and to be issued
ordinary share capital of SiS at approximately £82.3 million on a fully
diluted basis.
· It is intended that the Acquisition will be effected by means of
a Court-sanctioned scheme of arrangement between SiS and the Scheme
Shareholders under Part 26 of the Companies Act, although Bidco reserves the
right to effect the Acquisition by way of Takeover Offer.
Dividends
· If, on or after the date of this Announcement and prior to the
Effective Date, any dividend and/or other distribution and/or other return of
capital or value is announced, declared, made or paid or becomes payable in
respect of SiS Shares, Bidco reserves the right to reduce the consideration
payable in respect of each SiS Share by the amount of all or part of any such
dividend and/or distribution and/or return of capital or value. If Bidco
exercises this right, SiS Shareholders would be entitled to retain any such
dividend, distribution, or other return of capital or value declared, made or
paid.
Background to and reasons for the Acquisition
· bd-capital believes that the Acquisition represents an attractive
opportunity to partner with SiS to realise the potential of SiS' next phase of
growth.
· The Acquisition Price represents an attractive premium to the
current share price and allows SiS Shareholders to realise immediate value for
their shareholding.
· bd-capital believes that its operator-led investment model can
accelerate SiS's transition into its next phase of profitable growth. With
extensive experience in scaling up consumer health and sports-related
businesses, bd-capital is confident that its sector-specific and functional
expertise, combined with its access to additional capital, will unlock SiS's
growth potential.
· bd-capital has followed the development of SiS for a number of
years and believes that the Acquisition presents an opportunity to acquire two
strongly positioned brands in the sports nutrition category.
· bd-capital firmly believes that it can support SiS in delivering
its growth potential and it can provide, where needed, access to additional
capital, expertise and resource to support the development of the business, in
particular the expansion of the omnichannel offering and internationalisation
of the two brands.
· bd-capital believes that due to the relative illiquidity of the
SiS Shares and the challenges of raising funds through public markets
particularly, SiS does not currently have all the necessary components
(including capital) to fully unlock its growth potential over a reasonable
timeframe.
SiS Subsidiary Shares, Rollover Arrangements and bonuses
· The Rolling Managers, BUW and the DW Shareholding Entities have
entered into a Share Exchange and Equity Terms Deed pursuant to the terms of
which, among other things: (i) the SiS Subsidiary Manager Shareholders agree,
subject to the exercise of their put and call options under the SiS Subsidiary
Put and Call Options, to transfer the SiS Subsidiary Shares held by them to
SiS in exchange for SiS Shares; and (ii) Bidco will then acquire all of the
SiS Shares held by the Rolling Managers, BUW and the DW Shareholding Entities
in exchange for cash and Bidco Rollover Notes in the case of the Rolling
Managers and Gomrath, and cash only in the case of BUW and the Elidor Trust.
The SiS Shares (including those to be acquired pursuant to the SiS Subsidiary
Put and Call Options) which are subject to the Share Exchange and Equity Terms
Deed are Excluded Shares which are not subject to the Scheme, and the Rolling
Managers and Gomrath will not be entitled to vote their SiS Shares at the
Court Meeting or on the Rollover and Bonuses Resolution at the General
Meeting.
· BUW is not participating in the equity of the Wider Bidco Group.
· The Share Exchange and Equity Terms Deed includes undertakings by
the Rolling Managers, BUW and the DW Shareholding Entities to, among other
things (as applicable): (i) vote in favour (or procure a vote in favour) of
the Special Resolution at the General Meeting (and not to vote at the Court
Meeting or on the Rollover and Bonuses Resolution) (to the extent they hold
SiS Shares at the Scheme Voting Record Time); (ii) not sell, transfer, charge,
encumber, pledge or grant any option over or otherwise dispose of the
applicable SiS Shares or SiS Subsidiary Shares other than pursuant to the
Share Exchange and Equity Terms Deed; (iii) not accept and/or not vote in
favour of any competing scheme of arrangement or any other offer or similar
transaction in respect of any of their SiS Shares which might frustrate the
Acquisition or any part of it; and (iv) not enter into any agreement or
arrangement to participate in the capital of any person in connection with or
following any transaction relating to SiS or its assets or any arrangement
which would fall under Rule 16.2(c) of the Code (subject to certain
exceptions). Further details of these undertakings are set out in Appendix III
to this Announcement.
· The SiS Remuneration Committee has approved certain cash bonuses
to be paid by SiS to the executive directors of SiS upon the Scheme becoming
Effective (being the Cash Bonuses). The SiS Remuneration Committee also
intends to make a recommendation to the trustee of SiS' employee benefit trust
that it makes certain cash payments to the executive directors of SiS
following the Scheme becoming Effective using the cash proceeds it receives
from the sale of SiS Shares pursuant to the Acquisition (such cash payments
being the Trust Payments). Further details of these proposed cash bonuses and
payments are set out in paragraph 11 of this Announcement.
· As a condition to the Acquisition, the SiS Independent
Shareholders will be asked at the General Meeting to approve the Rollover
Arrangements, Cash Bonuses and Trust Payments by a simple majority voting in
favour of the Rollover and Bonuses Resolution, which will be proposed as an
ordinary resolution. Pursuant to Rule 16.2 of the Code, none of the Rolling
Managers, Gomrath, nor their respective connected persons, nor any person
holding SiS Shares on behalf of any of them will be entitled to vote on the
Rollover and Bonuses Resolution, and voting on the Rollover and Bonuses
Resolution will be by way of a poll. The passing of the Rollover and Bonuses
Resolution is a non-waivable condition to the Acquisition becoming Effective
and is not subject to Rule 13.5(a) of the Code.
· The SiS Independent Directors intend to recommend unanimously
that the SiS Independent Shareholders vote in favour of the Rollover and
Bonuses Resolution at the General Meeting (or, in the event that the
Acquisition is implemented by way of a Takeover Offer, that SiS Shareholders
accept or procure acceptances of such Takeover Offer), as the SiS Independent
Directors who hold SiS Shares have irrevocably undertaken to do in respect of
their own entire beneficial holdings of SiS Shares, amounting, in aggregate,
to 224,437 SiS Shares representing approximately 0.10 per cent. of the issued
share capital of SiS as at the Latest Practicable Date. As required by, and
solely for the purposes of, Rule 16.2 of the Code, Panmure Liberum (in its
capacity as independent adviser to SiS for the purposes of Rule 3 of the Code)
has reviewed the terms of the Rollover Arrangements, Cash Bonuses and Trust
Payments and considers that the terms of the Rollover Arrangements, Cash
Bonuses and Trust Payments are fair and reasonable, so far as the SiS
Independent Shareholders are concerned. In forming this view, Panmure Liberum
has taken into account the commercial assessments of the SiS Independent
Directors.
· Further details of the Rollover Arrangements, Cash Bonuses and
Trust Payments are set out in paragraph 11 of this Announcement.
SiS Independent Directors' Recommendation of the Acquisition
· The SiS Independent Directors, who have been so advised by
Panmure Liberum as to the financial terms of the Acquisition, consider the
terms of the Acquisition to be fair and reasonable. In providing advice to the
SiS Independent Directors, Panmure Liberum has taken into account the
commercial assessments of the SiS Independent Directors. Panmure Liberum is
providing independent financial advice to the SiS Independent Directors for
the purposes of Rule 3 of the Code.
· Accordingly, the SiS Independent Directors intend to recommend
unanimously that Scheme Shareholders vote in favour of the Scheme at the Court
Meeting and that SiS Shareholders vote in favour of the Special Resolution at
the General Meeting (or, in the event that the Acquisition is implemented by
way of a Takeover Offer, that SiS Shareholders accept or procure acceptances
of such Takeover Offer), as the SiS Independent Directors who hold SiS Shares
have irrevocably undertaken to do in respect of their own entire beneficial
holdings of SiS Shares, amounting, in aggregate, to 224,437 SiS Shares
representing approximately 0.10 per cent. of the issued share capital of SiS
as at the Latest Practicable Date.
Irrevocable undertakings
· In addition to the irrevocable undertakings referred to above
received from the SiS Independent Directors who hold SiS Shares, Bidco has
received irrevocable undertakings to vote in favour (or procure a vote in
favour) of the Scheme at the Court Meeting and the Resolutions to be proposed
at the General Meeting from certain SiS Shareholders who hold, in aggregate,
85,858,504 SiS Shares, representing approximately 36.96 per cent. of the
issued share capital of SiS as at the Latest Practicable Date.
· Pursuant to the terms of the Share Exchange and Equity Terms
Deed, the Rolling Managers, BUW and the DW Shareholding Entities who hold, in
aggregate, 8,443,109 SiS Shares representing approximately 3.63 per cent. of
the issued share capital of SiS as at the Latest Practicable Date, have also
undertaken (to the extent applicable) to vote in favour (or procure a vote in
favour) of the Special Resolution at the General Meeting.
· The SiS Shares held by the Rolling Managers, BUW and the DW
Shareholding Entities (including those to be acquired pursuant to the SiS
Subsidiary Put and Call Options) are subject to the Share Exchange and Equity
Terms Deed and are Excluded Shares which are not subject to the Scheme. The
Rolling Managers and Gomrath are not eligible to vote at the Court Meeting or
to vote on the Rollover and Bonuses Resolution at the General Meeting, but can
vote on the Special Resolution to be proposed at the General Meeting.
· Further details of these irrevocable undertakings (including
details of the circumstances in which they cease to be binding) are set out in
Appendix III to this Announcement.
Information on the SiS Group
· SiS is a leading sports nutrition business that develops,
manufactures, and markets innovative nutrition products for professional
athletes, sports and fitness enthusiasts and the active lifestyle community,
with production facilities based in Blackburn, United Kingdom. SiS was
admitted to trading on AIM in August 2013, and its market capitalisation as at
the Latest Practicable Date was approximately £63.9 million.
· SiS has two highly regarded brands: PhD, a premium
active-nutrition brand targeting the active lifestyle community; and SiS, a
leading endurance nutrition brand for elite athletes and professional sports
teams.
· The two brands sell through SiS' www.phd.com/ and
www.scienceinsport.com/ digital platforms, third-party online sites, including
Amazon and eBay, and extensive retail distribution in the UK and
internationally, including major supermarkets, high street chains and
specialist sports retailers. This omnichannel footprint enables SiS to address
the full breadth of the sports nutrition market.
· SiS was founded in 1992, and has a core range comprising gels,
powders and bars focused on hydration and recovery. It is an official
endurance nutrition supplier to multiple professional teams, organisations and
clubs worldwide.
Information on Bidco and bd-capital
· Bidco is a newly formed private company limited by shares,
registered in England and Wales, and indirectly wholly-owned by funds advised
by bd-capital. It was created for the purpose of the Acquisition and has not
traded since its incorporation.
· bd-capital was founded in 2019 by Andrew Dawson (former Partner
at Advent International), and Richard Baker (former FTSE 100 CEO and Chairman,
and Advent Operating Partner). bd-capital is a private equity firm that
follows an operator-led investment strategy, making majority investments in
mid-market businesses headquartered in the UK, Benelux and Iberia, which
operate in industries that are experiencing enduring structural growth across
the Healthcare, Services and Consumer sectors.
· bd-capital has raised two funds since its inception, and,
currently, has over €800 million in assets under management. bd-capital's
second fund closed in March 2025 with total commitments of €430 million,
exceeding the initial target by 20 per cent.
· The Acquisition represents bd-capital's third investment in the
Consumer Healthcare space, following its previous investments in Symprove, a
gut health food supplement brand, and Bonusan, a pan-European vitamins,
minerals and supplements brand.
· bd-capital also has extensive experience in the wider Sports and
Leisure markets with investments in Sportscape, a European e-commerce platform
for sports and outdoor consumer goods, and Greenset Group, a global brand and
manufacturer of tennis and padel courts.
Timetable and Conditions
· The Acquisition is conditional on, among other things, the
approvals of the relevant SiS Shareholders and the sanction of the Scheme by
the Court. The Acquisition is also subject to the Conditions and further terms
set out in Appendix I to this Announcement, and to the full terms and
conditions to be set out in the Scheme Document.
· The Acquisition and resolutions concerning related matters will
be put to Scheme Shareholders at the Court Meeting and to SiS Shareholders at
the General Meeting. The Court Meeting and the General Meeting are required to
enable SiS Shareholders to consider and, if thought fit, vote in favour of the
Scheme and the resolutions to approve and implement the Acquisition. In order
to become Effective, the Scheme must be approved by a majority in number of
Scheme Shareholders present, entitled to vote and voting at the Court Meeting,
whether in person or by proxy, representing at least 75 per cent. in value of
the voting rights of such Scheme Shareholders. In addition, the Rollover and
Bonuses Resolution must be approved by SiS Independent Shareholders
representing a simple majority of votes cast on that resolution at the General
Meeting and the Special Resolution must be approved by SiS Shareholders
representing at least 75 per cent. of the votes cast on that resolution at the
General Meeting.
· The SiS Shares held by the Rolling Managers, BUW and the DW
Shareholding Entities (including those to be acquired pursuant to the SiS
Subsidiary Put and Call Options) are subject to the Share Exchange and Equity
Terms Deed and are Excluded Shares which are not subject to the Scheme. The
Rolling Managers and Gomrath are not eligible to vote at the Court Meeting or
to vote on the Rollover and Bonuses Resolution at the General Meeting, but can
vote on the Special Resolution at the General Meeting.
· The Scheme Document, containing further information about the
Acquisition, full details of the Scheme, notices of the Court Meeting and the
General Meeting and the expected timetable of principal events relating to the
Acquisition, together with the Forms of Proxy for use in connection with the
SiS Meetings, will specify the actions to be taken by SiS Shareholders and is
expected to be published as soon as practicable and in any event within 28
days of the date of this Announcement (unless otherwise agreed by the Panel,
Bidco and SiS).
· It is expected that the Scheme will become Effective no later
than July 2025, subject to the satisfaction (or, where applicable, waiver) of
the Conditions set out in Appendix I to this Announcement. Bidco will work
with SiS to engage constructively with all relevant stakeholders to satisfy
these Conditions.
Comments on the Acquisition
Commenting on the Acquisition, Andrew Dawson, Managing Partner of bd-capital
said:
"We are impressed by the attractive fundamentals and high growth potential of
SiS' two brands, both operating in growing segments of the attractive sports
nutrition market. We are particularly attracted to the science-led heritage of
the company, with strong advocacy amongst elite athletes and a loyal consumer
base - all of which provide it with solid foundations for growth in the UK and
internationally.
We have been monitoring the business for several years and have been highly
impressed by the results achieved by the current management team in the last
18 months. As an operator-led, sector specialist investor, bd-capital has
strong experience in supporting leading consumer health and VMS businesses,
and we will bring to bear our full range of capabilities to support SiS'
growth. We look forward to working with SiS' management and employees to
accelerate the strategy and unlock the long-term value of the company."
Commenting on the Acquisition, Henry Turcan, Non-Executive Director of SiS
said:
"SiS has built a fantastic portfolio of sports nutrition products and the
current management team has been instrumental in reshaping its strategic
focus. Nonetheless, whilst progress has been substantive, much remains to be
done to optimise the value potential of the SiS Group.
The SiS Board believes that the current offer reflects the premium nature of
the SiS brands and market position which has been established and rewards
shareholders for the faith and capital provided, most recently at the
turnaround fundraising undertaken in July last year at a price of 17 pence per
share. The Acquisition will provide SiS Shareholders with the opportunity to
realise the value of their holdings, in cash, at an attractive value without
providing further capital or assuming additional risk likely to be necessary
to drive meaningful growth and value creation over the medium term."
This summary should be read in conjunction with, and is subject to, the full
text of this Announcement and its Appendices. The Acquisition will be subject
to the Conditions and further terms set out in Appendix I to this Announcement
and to the full terms and conditions which will be set out in the Scheme
Document. Appendix II to this Announcement contains the sources of information
and bases of calculations of certain information contained in this
Announcement. Appendix III contains a summary of the irrevocable undertakings
received in relation to the Acquisition. Appendix IV contains a summary of the
key terms of certain securities in the Bidco Group. The defined terms used in
this summary and in this Announcement are set out in Appendix V.
The person responsible for arranging the release of this Announcement on
behalf of SiS is Daniel Wright.
Enquiries:
Investec (Financial Adviser to bd-capital and Bidco) +44 (0) 20 7597 4000
Oliver Cardigan
Maria Gomez de Olea
Joanna Langley
Panmure Liberum (Financial Adviser, Rule 3 Adviser, Nominated Adviser and +44 (0) 20 3100 2000
Broker to SiS)
Investment Banking:
Bidhi Bhoma
Edward Thomas
John More
Joshua Borlant
M&A:
Tim Medak
Addleshaw Goddard LLP is acting as legal adviser to SiS in connection with the
Acquisition. Stephenson Harwood LLP is acting as legal adviser to bd-capital
and Bidco in connection with the Acquisition.
Important Notices
Investec Bank plc ("Investec"), which is authorised in the United Kingdom by
the Prudential Regulation Authority (the "PRA") and regulated in the United
Kingdom by the PRA and the FCA, is acting exclusively for bd-capital and Bidco
as financial adviser and no one else in connection with the matters referred
to in this Announcement and will not regard any other person as its client in
relation to such matters and accordingly will not be responsible to anyone
other than bd-capital and Bidco for providing the protections afforded to
clients of Investec, nor for providing advice in relation to any matter
referred to in this Announcement. Neither Investec 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
Investec in connection with the matters referred to in this Announcement, any
statement contained herein or otherwise. Apart from the responsibilities and
liabilities, if any, which may be imposed on Investec by the Financial
Services and Markets Act 2000, 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 Investec nor any of its subsidiaries, branches or
affiliates accepts any responsibility or liability whatsoever for the contents
of this Announcement or for the omission of any material information for which
it is not responsible, and no representation or warranty, 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 the Acquisition or the matters described in
this Announcement. To the fullest extent permitted by applicable law,
Investec, its subsidiaries, branches and its affiliates accordingly disclaim
all and any responsibility or liability whether arising in tort, contract or
otherwise (save as referred to above in this paragraph) which they might
otherwise have in respect of this Announcement, or any statement contained
herein.
Panmure Liberum Ltd ("Panmure Liberum"), which is authorised and regulated by
the FCA in the United Kingdom, is acting as adviser for the purposes of Rule 3
of the Code and financial adviser to SiS and no one else in connection with
the matters referred to in this Announcement and will not be responsible to
anyone other than SiS for providing the protections afforded to clients of
Panmure Liberum, or for providing advice in relation to the matters referred
to in this Announcement. Neither Panmure 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 Panmure Liberum in connection with the
matters referred to in this Announcement, any statement contained 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 an offer, invitation or the solicitation
of an offer to purchase, otherwise acquire, subscribe for, sell or otherwise
dispose of any securities, or the solicitation of any vote or approval in any
jurisdiction, pursuant to the Acquisition or otherwise, nor shall there be any
sale, issuance or transfer of securities of SiS in any jurisdiction in
contravention of applicable law. The Acquisition will be made solely pursuant
to the terms of the Scheme Document (or, if the Acquisition is to be
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 SiS Shareholders may vote in respect of the Acquisition. Any vote,
approval, decision in respect of, or other response to, the Acquisition should
be made only on the basis of the information contained in the Scheme Document
(or any other document by which the Acquisition is made by way of a Takeover
Offer).
The statements contained in this Announcement are made as at the date of this
Announcement, unless some other time is specified in relation to them, and the
release of this Announcement shall not give rise to any implication that there
has been no change in the facts set out in this Announcement since such date.
This Announcement does not constitute a prospectus or prospectus equivalent or
exempted document.
No person should construe the contents of this Announcement as legal,
financial or tax advice. 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, accountant or from an independent financial adviser duly
authorised under FSMA if you are resident in the United Kingdom, or another
appropriately authorised independent financial adviser, if you are in a
territory outside the United Kingdom.
Overseas Shareholders
This Announcement has been prepared for the purpose of complying with English
law, the Code, UK MAR, the Disclosure Guidance and Transparency Rules and the
AIM Rules 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 of jurisdictions outside England. Nothing in this Announcement
should be relied on for any other purpose.
The release, publication or distribution of this Announcement in or into
certain jurisdictions other than the United Kingdom may be restricted by the
laws and/or regulations of those jurisdictions and therefore persons into
whose possession this Announcement comes who are subject to the laws and/or
regulations of any jurisdiction other than the United Kingdom should inform
themselves about and observe any such applicable laws and/or regulations in
their jurisdiction. In particular, the ability of persons who are not resident
in the United Kingdom or who are subject to the laws of another jurisdiction
to participate in the Acquisition or to vote their SiS Shares with respect to
the Scheme at the Court Meeting, the Resolutions at the General Meeting, or to
execute and deliver Forms of Proxy appointing another person as proxy to vote
at the Court Meeting or the General Meeting on their behalf, may be affected
by the laws of the relevant jurisdiction in which they are located or to which
they are subject. Any failure to comply with such restrictions may constitute
a violation of the securities laws of 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 Code, and permitted by
applicable law and regulation, the Acquisition shall not be made available, in
whole or in part, directly or indirectly, in, into or from a Restricted
Jurisdiction where to do so would violate the laws or regulations in that
jurisdiction and no person may vote in favour of the Acquisition by any such
use, means, instrumentality or from within a Restricted Jurisdiction or any
other jurisdiction if to do so would constitute a violation of the laws or
regulations of that jurisdiction.
The Acquisition will be subject to the applicable requirements of English law,
the Code, the Panel, the AIM Rules, the London Stock Exchange and the FCA.
Copies of this Announcement and any formal documentation relating to the
Acquisition are not being, and must not be, directly or indirectly, mailed or
otherwise forwarded, distributed or sent in or into or from any Restricted
Jurisdiction or any jurisdiction where to do so would constitute a violation
of the laws or regulations of such jurisdiction and persons receiving such
documents (including custodians, nominees and trustees) must not mail or
otherwise forward, distribute or send them in or into or from any Restricted
Jurisdiction. Doing so may render invalid any related purported vote in
respect of the Acquisition.
Further details and information in relation to Overseas Shareholders will be
contained in the Scheme Document.
Additional information for U.S. investors
U.S. SiS Shareholders should note that the Acquisition relates to an offer for
the shares of a UK company and is being made by means of a scheme of
arrangement provided for under English company law. The Acquisition, to be
implemented by way of a scheme of arrangement, is not subject to the tender
offer rules or the proxy solicitation rules under the U.S. Exchange Act, as
amended. Accordingly, the Acquisition is subject to the requirements and
practices applicable to a scheme of arrangement involving a target company in
the UK traded on AIM, which differ from the requirements of the U.S. tender
offer and proxy solicitation rules. The financial information with respect to
SiS included in this Announcement and the Scheme Document has been, or will
have been, prepared in accordance with IFRS and thus may not be comparable to
the financial information of U.S. companies or companies whose financial
statements are prepared in accordance with generally accepted accounting
principles in the U.S. If, in the future, Bidco exercises its right to
implement the Acquisition by way of a Takeover Offer and determines to extend
the Takeover Offer into the U.S., the Acquisition will be made in compliance
with applicable U.S. tender offer rules.
It may be difficult for U.S. SiS Shareholders to enforce their rights and any
claims they may have arising under the U.S. federal securities laws in
connection with the Acquisition, since SiS and Bidco are each located in a
country other than the United States, and some or all of their respective
officers and directors may be residents of countries other than the United
States. U.S. shareholders may not be able to sue SiS, Bidco or their
respective officers or directors in a non-U.S. court for violations of the
U.S. securities laws. Further, it may be difficult to compel SiS or Bidco and
their respective affiliates to subject themselves to the jurisdiction or
judgment of a U.S. court for violations of the U.S. securities laws.
Neither the SEC nor any U.S. state securities commission has approved,
disproved or passed judgment upon the fairness or the merits of the
Acquisition or determined if this Announcement is adequate, accurate or
complete. Any representation to the contrary is a criminal offence in the
United States.
In accordance with normal United Kingdom practice and pursuant to Rule
14e-5(b) of the U.S. Exchange Act, Bidco, certain of its affiliated companies
and their respective nominees or brokers (acting as agents), may from time to
time make certain purchases of, or arrangements to purchase, shares or other
securities of SiS outside of the United States, 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 would
comply with applicable law, including the U.S. Exchange Act. Any information
about such purchases or arrangements to purchase will be disclosed as required
in the UK, will be reported to a Regulatory Information Service and will be
available on the London Stock Exchange website at www.londonstockexchange.com.
Forward-looking statements
This Announcement (including information incorporated by reference into this
Announcement), oral statements made regarding the Acquisition, and other
information published by Bidco or SiS contain statements which are, or may be
deemed to be, "forward-looking statements". All statements other than
statements of historical facts included in this Announcement, may 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 of Bidco and SiS 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 bd-capital,
Bidco, the Wider Bidco Group, SiS, the Wider SiS Group, 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 "plans", "expects" or "does not expect", "is
expected", "is subject to", "budget", "scheduled", "estimates", "forecasts",
"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 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 bd-capital's, Bidco's or
SiS' operations and potential synergies resulting from the Acquisition.
Although Bidco and SiS believe that the expectations reflected in such
forward-looking statements are reasonable, neither Bidco nor SiS can give
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 affect the future operations of the
Wider SiS Group, the Wider Bidco Group or the Enlarged Group or 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 on the proposed terms; domestic and global
business and economic conditions; the impact of pandemics, asset prices;
market-related risks such as fluctuations in interest rates and exchange
rates, industry trends, competition, changes in government and regulation,
changes in the policies and actions of governments and/or regulatory
authorities (including changes related to capital and tax), changes in
political and economic stability (including exposures to terrorist activities,
the UK's exit from the European Union, Eurozone instability, the ongoing
Russia-Ukraine conflict, the ongoing conflict in the Middle East, disruption
in business operations due to reorganisation activities, interest rate,
inflation, deflation and currency fluctuations), the timing impact and other
uncertainties of future or planned acquisitions or disposals or offers, the
inability of the Enlarged Group to realise successfully any anticipated
synergy benefits when the Acquisition is implemented (including changes to the
board and/or employee composition of the Enlarged Group), the inability of the
Bidco Group to integrate successfully the SiS Group's operations and
programmes when the Acquisition is implemented, the Enlarged Group incurring
and/or experiencing unanticipated costs and/or delays (including IT system
failures, cyber-crime, fraud and pension scheme liabilities) or difficulties
relating to the Acquisition when the Acquisition is implemented. Other unknown
or unpredictable factors could affect future operations and/or cause actual
results to differ materially from those in the forward-looking statements.
Such forward-looking statements should therefore be construed in the light of
such factors.
Each forward-looking statement speaks only as of the date of this
Announcement. Neither bd-capital, the Bidco Group, nor the SiS Group, nor any
of their respective associates or directors, officers or advisers, provides
any representation, warranty, assurance or guarantee that the occurrence of
the events expressed or implied in any forward-looking statements in this
Announcement will actually occur. Forward-looking statements involve inherent
risks and uncertainties. All forward-looking statements contained in this
Announcement are expressly qualified in their entirety by the cautionary
statements contained or referred to in this section. Readers are cautioned not
to place undue reliance on these forward-looking statements. Other than in
accordance with their legal or regulatory obligations (including under the
Code, UK MAR, the AIM Rules and the DTRs), neither bd-capital, the Wider Bidco
Group, nor the Wider SiS Group is under or undertakes any obligation, and each
of the foregoing 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.
Disclosure requirements of the Code
Under Rule 8.3(a) of the 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 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.
No profit forecasts or estimates
The SiS Profit Forecast constitutes an ordinary course profit forecast for SiS
published before the start of the Offer Period for the purposes of Note 2(a)
on Rule 28.1 of the Code. As required by Rule 28.1(c)(i) of the Code, the SiS
Profit Forecast, the assumptions on the basis of which it was compiled and the
SiS Directors' confirmations in relation to it are set out in paragraph 5 of
this Announcement.
Other than the SiS Profit Forecast, no statement in this Announcement is
intended, or is to be construed, as a profit forecast, profit estimate or
quantified financial benefits statement for any period and no statement in
this Announcement should be interpreted to mean that earnings or earnings per
share for Bidco or SiS for the current or future financial years will
necessarily match or exceed the historical published earnings or earnings per
share for Bidco or SiS.
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 a website
In accordance with Rule 26.1 of the Code, a copy of this Announcement will be
made available, subject to certain restrictions relating to persons resident
in Restricted Jurisdictions, on SiS' website at
https://www.sisplc.com/possible-offer// by no later than 12 noon (London time)
on the first Business Day following the date of this Announcement.
For the avoidance of doubt, neither the content of this website nor the
contents of any websites accessible from any hyperlinks is incorporated into
or forms part of this Announcement.
Requesting hard copy documents
In accordance with Rule 30.3 of the Code, SiS Shareholders may request a hard
copy of this Announcement (and any information incorporated by reference in
this Announcement), free of charge, by contacting Equiniti during business
hours on 0345 607 6838 (from within the United Kingdom) and +44 121 415 7082
(from outside the United Kingdom) or by submitting a request in writing to The
Company Secretary, at Highdown House, Yeoman Way, Worthing, West Sussex, BN99
3HH . 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. Lines will be open between 9.00 a.m. to 5.30 p.m., Monday
to Friday excluding public holidays in England and Wales.
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. Such persons may also request that all future documents,
announcements and information to be sent to them in relation to the
Acquisition should be in hard copy form.
Scheme process
In accordance with Section 5 of Appendix 7 of the Code, SiS will announce
through a Regulatory Information Service key events in the Scheme process
including the outcomes of the SiS Meetings and the Sanction Hearing.
Unless otherwise consented to by the Court and the Panel, any modification or
revision to the Scheme will be made no later than the date which is 14 days
prior to the SiS Meetings (or any later date to which such meetings are
adjourned). In accordance with Section 11 of Appendix 7 of the Code, if the
Scheme lapses or is withdrawn all documents of title and other documents
lodged will be returned as soon as practicable and in any event within 14 days
of such lapsing or withdrawal.
Electronic communications / information relating to SiS Shareholders
Please be aware that addresses, electronic addresses and certain other
information provided by SiS Shareholders, persons with information rights and
other relevant persons for the receipt of communications from SiS may be
provided to Bidco during the Offer Period as required under Section 4 of
Appendix 4 to the Code to comply with Rule 2.11(c) of the Code.
NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION IN WHOLE OR IN PART, DIRECTLY OR
INDIRECTLY, IN, INTO OR FROM ANY JURISDICTION WHERE TO DO SO WOULD CONSTITUTE
A VIOLATION OF THE RELEVANT LAWS OR REGULATIONS OF SUCH JURISDICTION
THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION
FOR IMMEDIATE RELEASE
17 April 2025
RECOMMENDED CASH ACQUISITION
of
Science in Sport plc ("SiS")
by
Einstein Bidco Limited ("Bidco")
a newly formed company indirectly wholly-owned by funds advised by bd-capital
Partners Limited
to be effected by means of a scheme of arrangement
under Part 26 of the UK Companies Act 2006
1. Introduction
The board of directors of Bidco and the SiS Independent Directors are pleased
to announce that they have reached agreement on the terms of a recommended all
cash acquisition by Bidco of the entire issued and to be issued ordinary share
capital of SiS (the "Acquisition").
The Acquisition is expected to be effected by means of a Court-sanctioned
scheme of arrangement between SiS and Scheme Shareholders under Part 26 of the
Companies Act, although Bidco reserves the right to effect the Acquisition by
way of Takeover Offer.
2. The Acquisition
Under the terms of the Acquisition, which will be subject to the Conditions
and further terms set out in Appendix I to this Announcement and to the full
terms and conditions which will be set out in the Scheme Document, each Scheme
Shareholder at the Scheme Record Time will be entitled to receive:
for each Scheme Share: 34 pence in cash
The Acquisition Price represents an attractive premium of approximately:
· 23.6 per cent. to the Closing Price of 27.5 pence per SiS Share
on 15 April 2025 (being the last Business Day prior to the commencement of the
Offer Period);
· 28.8 per cent. to the sixth-month Volume Weighted Average Price
of 26.4 pence per SiS Share on 15 April 2025 (being the last Business Day
prior to the commencement of the Offer Period);
· 44.7 per cent. to the twelve-month Volume Weighted Average Price
of 23.5 pence per SiS Share on 15 April 2025 (being the last Business Day
prior to the commencement of the Offer Period); and
· 100 per cent. to the issue price of 17 pence at which SiS raised
approximately £8.5 million in July 2024 via a Placing and Retail Offer of SiS
Shares.
The Acquisition values the entire issued and to be issued ordinary share
capital of SiS at approximately £82.3 million on a fully diluted basis.
The Acquisition will be subject to the Conditions and certain further terms
set out in Appendix I to this Announcement, including, among other things: (i)
the approval of Scheme Shareholders at the Court Meeting and the passing of
the Resolutions at the General Meeting; (ii) the sanction of the Scheme by the
Court; and (iii) the Scheme becoming Effective no later than 11.59 p.m. on the
Long Stop Date.
In order to become Effective, the Scheme must be approved by a majority in
number representing not less than 75 per cent. in value of the Scheme
Shareholders in each case present, entitled to vote and voting, either in
person or by proxy, at the Court Meeting.
SiS Shares will be acquired by Bidco fully paid and free from all liens,
equitable interests, charges, encumbrances, rights of pre-emption and any
other third-party rights or interests whatsoever and together with all rights
existing at the date of this Announcement or thereafter attaching thereto,
including (without limitation) the right to receive and retain, in full, all
dividends, other distributions (if any) declared, made or paid or any other
return of capital (whether by way of reduction of share capital or share
premium account or otherwise) made on or after the Effective Date in respect
of SiS Shares.
If, on or after the date of this Announcement and prior to the Effective Date,
any dividend and/or other distribution and/or other return of capital or value
is announced, declared, made or paid or becomes payable in respect of SiS
Shares, Bidco reserves the right to reduce the consideration payable in
respect of each SiS Share by the amount of all or part of any such dividend
and/or distribution and/or return of capital or value. If Bidco exercises this
right, SiS Shareholders would be entitled to retain any such dividend,
distribution, or other return of capital or value declared, made or paid.
The Scheme Document, containing further information about the Acquisition,
full details of the Scheme, notices of the Court Meeting and the General
Meeting and the expected timetable of principal events relating to the
Acquisition, together with the Forms of Proxy for use in connection with the
SiS Meetings, is expected to be published as soon as practicable and in any
event within 28 days of the date of this Announcement (unless otherwise agreed
by the Panel, Bidco and SiS).
Once the Acquisition becomes Effective in accordance with its terms, which
will be subject to the Conditions and further terms set out in Appendix I to
this Announcement and to the full terms and conditions which will be set out
in the Scheme Document, SiS will be wholly-owned by Bidco.
3. Background to and reasons for the Acquisition
bd-capital believes that the Acquisition presents an opportunity to invest in
two strongly positioned brands in the sports nutrition category. bd-capital
recognises the critical importance for building brand trust and loyalty and
believes that both brands score highly across each of these criteria.
bd-capital is highly impressed by the progress made by the new management team
over the last 18 months. However, bd-capital believes that it can accelerate
SiS' transition into the next phase of profitable growth in a private
partnership through its operator-led investment model. bd-capital believes
that it is strongly-positioned to support SiS due to its deep experience in
scaling up consumer health and sports-related businesses in the UK and
internationally. bd-capital's operator-led model provides it with deep
sectoral and functional expertise which can be leveraged to unlock growth in
the businesses in which it invests. This expertise, combined with its access
to additional capital, gives bd-capital the confidence that it can help SiS in
the next phase of its growth.
In addition, bd-capital believes that SiS is best positioned to realise its
full growth potential as a privately owned company. bd-capital believes that
the illiquidity of the SiS' Shares and the current challenges of raising funds
through public markets restrict SiS' ability to fully unlock its growth
potential over a reasonable timeframe. The limited access to capital, combined
with the potentially greater strategic flexibility as a private company, make
private ownership the best opportunity for SiS to maximise its potential.
4. SiS Independent Directors' Recommendation of the Acquisition
The SiS Independent Directors, who have been so advised by Panmure Liberum as
to the financial terms of the Acquisition, consider the terms of the
Acquisition to be fair and reasonable. In providing advice to the SiS
Independent Directors, Panmure Liberum has taken into account the commercial
assessments of the SiS Independent Directors. Panmure Liberum is providing
independent financial advice to the SiS Independent Directors for the purposes
of Rule 3 of the Code.
Accordingly, the SiS Independent Directors intend to recommend unanimously
that Scheme Shareholders vote in favour of the Scheme at the Court Meeting and
that SiS Shareholders vote in favour of the Special Resolution at the General
Meeting (or, in the event that the Acquisition is implemented by way of a
Takeover Offer, that SiS Shareholders accept or procure acceptances of such
Takeover Offer), as the SiS Independent Directors who hold SiS Shares have
irrevocably undertaken to do in respect of their own entire beneficial
holdings of SiS Shares, amounting, in aggregate, to 224,437 SiS Shares
representing approximately 0.10 per cent. of the issued share capital of SiS
as at the Latest Practicable Date.
Further details of these irrevocable undertakings (including details of the
circumstances in which they cease to be binding) are set out in Appendix III
to this Announcement.
5. Background to and reasons for the SiS Independent Directors'
recommendation
SiS, a leading sports nutrition company, founded in 1992, has had a
challenging journey as a listed company since its admission to AIM in 2013.
While SiS' focus on its core SiS and PHD brands targets a global sports
nutrition market with strong underlying growth characteristics, performance
has been mixed, with fluctuating revenues and a high-cost base, resulting in
EBITDA losses and net income deficits over recent years. However, following a
strategic review, an £8.5 million share Placing and Retail Offer in 2024 and
a refreshed management team, recent performance has improved as SiS has sought
to improve its operating model and margin, while stabilising revenue growth.
While these improvements have been recognised to an extent by the market and
reflected in an improving SiS share price, maximising its full potential is
likely to require further capital investment in distribution and product range
to scale SiS. Failure to do so will, over time, impact SiS' competitiveness
and terminal value. Whilst SiS has demonstrated significantly improved
operating margins it does not yet generate material free cashflow to enable it
to fund strategic growth initiatives organically.
Investor sentiment in the public markets, particularly towards UK smaller
companies, remains subdued and with generally negative macro sentiment and
increasing business risk, exacerbated by recent global volatility,
particularly for a discretionary spend consumer business, the SiS Independent
Directors consider that access to capital whilst remaining as a quoted company
is uncertain. Furthermore, the pressure on short term growth targets
associated with semi-annual reporting can distort the strategic requirement
for longer term investment horizons.
The SiS Independent Directors believe that the Acquisition will provide SiS
with improved access to flexible capital outside the constraints of the public
markets, enabling the removal of public company costs and, along with the
additional strategic insight and operational support and fast-moving consumer
goods (FMCG) expertise which Bidco brings, give it the best chance to achieve
growth faster and more sustainably than SiS would be able to achieve alone as
a listed entity.
The Acquisition Price of 34 pence per SiS Share, values the entire issued and
to be issued share capital of SiS at approximately £82.3 million on a fully
diluted basis and implies an Enterprise Value of £97.8 million and an
Enterprise Value to Adjusted EBITDA multiple for the year ended 31 December
2024 of approximately 23.1 times, which the SiS Independent Directors consider
compelling, particularly in light of SiS' limited cash-generative profile and
historical net profit conversion and risks to medium term delivery in a
capital constrained environment.
The Acquisition Price represents an attractive premium of approximately:
· 23.6 per cent. to the Closing Price of 27.5 pence per SiS Share
on 15 April 2025 (being the last Business Day prior to the commencement of the
Offer Period);
· 28.8 per cent. to the sixth-month Volume Weighted Average Price
of 26.4 pence per SiS Share on 15 April 2025 (being the last Business Day
prior to the commencement of the Offer Period);
· 44.7 per cent. to the twelve-month Volume Weighted Average Price
of 23.5 pence per SiS Share on 15 April 2025 (being the last Business Day
prior to the commencement of the Offer Period); and
· 100 per cent. to the issue price of 17 pence at which SiS raised
approximately £8.5 million in July 2024 via a Placing and Retail Offer of SiS
Shares.
Accordingly, following careful consideration of the above factors and the
intentions of Bidco mentioned in paragraph 9 below, the SiS Independent
Directors unanimously intend to recommend that SiS Shareholders vote (or
procure votes) 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 way of a Takeover Offer, accept such Takeover
Offer) on the terms, and subject to the conditions, set out in this
Announcement.
Application of Rule 28.1(c) of the Code
On 30 January 2025, SiS published its trading update for the financial year
ended 31 December 2024 and stated:
"The Board is pleased to report that the Group's unaudited results for FY24,
including Adjusted EBITDA and Adjusted Net Debt, are expected to be ahead of
current market expectations by reporting:
Key Financials (unaudited):
FY24 FY23 Change FY24 H2 FY24 H1 Change
Revenue £51.9m £62.8m (17.5%) £26.2m £25.7m +1.9%
Adjusted EBITDA £4.2m £2.0m +105.0% £2.2m £2.0m +10.0%
Adjusted Net Debt £5.9m £12.9m +£7.0m £5.9m £13.8m +£7.9m
Since the Interim Results were announced on 16 September 2024, the Group has
continued to see improvements in its operational and financial performance,
gaining further traction on returning to profitable growth from a stronger
operating platform, with a significantly reduced cost base as well as
improving operating margins and cash generation dynamics. Gross margins have
continued to improve throughout FY24 to in excess of c.45% (FY23: c.43%)."
The statements set out above constitute an ordinary course profit forecast for
SiS published before the start of the Offer Period for the purposes of Note
2(a) on Rule 28.1 of the Code (the "SiS Profit Forecast").
SiS Directors' confirmation
The SiS Directors confirm that, as at the date of this Announcement, the SiS
Profit Forecast remains valid and that it has been properly compiled on the
basis of the assumptions stated below and that the basis of accounting used is
consistent with SiS' accounting policies.
Assumptions
The SiS Profit Forecast was prepared on the basis of internal SiS forecasts
and the following assumptions.
Factors outside the influence or control of the SiS Directors
o No material change to current prevailing global macroeconomic and
political environment in the principal markets and regions in which SiS
operates;
o No change in general sentiment towards SiS and/or its operations which has
an impact on its ability to attract customers and to operate its business;
o No change in legislation, taxation or regulatory environment relating to
SiS or which may impact demand for SiS' products amongst both existing and
prospective customers;
o No changes in customer demand for SiS' products or the competitive
environment in which SiS operates; and
o No material adverse change to SiS' commercial relationships.
Factors within the influence or control of the SiS Directors
o No material change in the operational strategy of SiS from the date of
this Announcement;
o No material changes in SiS' accounting policies and/or the application
thereof;
o No material strategic investments over and above those currently planned,
including the hiring of additional employees;
o No change in SiS' costs over and above those currently planned and
anticipated; and
o No material changes to the senior leadership team of SiS.
6. Irrevocable undertakings
In addition to the irrevocable undertakings referred to above at paragraph 4
received from the SiS Independent Directors, Bidco has received irrevocable
undertakings to vote in favour (or procure a vote in favour) of the Scheme at
the Court Meeting and the Resolutions to be proposed at the General Meeting
from certain SiS Shareholders who hold, in aggregate, 85,858,504 SiS Shares,
representing approximately 36.96 per cent. of the issued share capital of SiS
as at the Latest Practicable Date.
Pursuant to the terms of the Share Exchange and Equity Terms Deed (further
details of which are set out in paragraph 11 of this Announcement), the
Rolling Managers, BUW and the DW Shareholding Entities who hold, in aggregate,
8,443,109 SiS Shares, representing approximately 3.63 per cent. of the issued
share capital of SiS as at the Latest Practicable Date, have also undertaken
(to the extent applicable) to vote in favour (or procure a vote in favour) of
the Special Resolution at the General Meeting. The SiS Shares held by the
Rolling Managers, BUW and the DW Shareholding Entities (including those to be
acquired pursuant to the SiS Subsidiary Put and Call Options) are subject to
the Share Exchange and Equity Terms Deed and are Excluded Shares which are not
subject to the Scheme. The Rolling Managers and the DW Shareholding Entities
are not eligible to vote at the Court Meeting or to vote on the Rollover and
Bonuses Resolution at the General Meeting but can vote on the Special
Resolution to be proposed at the General Meeting.
Further details of these irrevocable undertakings (including details of the
circumstances in which they cease to be binding) are set out in Appendix III
to this Announcement.
7. Information on Bidco and bd-capital
Bidco is a newly formed private company limited by shares registered in
England and Wales and incorporated on 2 April 2025 with company number
16361461. Bidco is indirectly wholly-owned by the Investor, which is advised
by bd-capital. Bidco was formed solely 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.
bd-capital was founded in 2019 by Andrew Dawson (former Partner at Advent
International), and Richard Baker (former FTSE 100 CEO and Chairman, and
Advent Operating Partner). bd-capital is a private equity firm that follows an
operator-led investment strategy, making majority investments in mid-market
businesses headquartered in the UK, Benelux and Iberia, which operate in
industries that are experiencing enduring structural growth across the
Healthcare, Services and Consumer sectors. bd-capital has offices in London,
Amsterdam and Madrid.
bd-capital has raised two funds since its inception, and, currently, has over
€800 million assets under management. To date, bd-capital has invested in
eight companies. bd-capital's second fund closed in March 2025 with total
commitments of €430 million, exceeding the initial target by 20 per cent.
The acquisition of SiS will be bd-capital's third investment from the
Investor.
bd-capital has extensive experience in the international Consumer Healthcare
and Sports sectors, which it believes will be highly valuable in a partnership
with SiS. bd-capital's first investment, made in 2020, was Symprove, a gut
health food supplement brand. In 2023, bd-capital invested in Bonusan, a
Dutch-based pan-European vitamins, minerals and supplements brand, supporting
its expansion plans in Europe.
Additionally, bd-capital has significant expertise in the Sports and Leisure
sectors. In 2021, it invested in Sportscape (formerly known as SportPursuit
before merging with the Private Sports Shop), an e-commerce platform for
sports and outdoor apparel and equipment. In 2022, bd-capital invested in
Rakit Group (now called Greenset Group), formed from the combination of
Greenset, a manufacturer of tennis hardcourt surfaces, and Padel Courts
Deluxe, a provider of premium padel courts.
8. Information on the SiS Group
SiS is a leading sports nutrition business that develops, manufactures, and
markets innovative nutrition products for professional athletes, sports and
fitness enthusiasts and the active lifestyle community with production
facilities based in Blackburn, UK. SiS was admitted to trading on AIM in
August 2013 and its market capitalisation at the Latest Practicable Date was
approximately £63.9 million.
SiS has two highly regarded brands: PhD, a premium active-nutrition brand
targeting the active lifestyle community; and SiS, a leading endurance
nutrition brand for elite athletes and professional sports teams.
The two brands sell through SiS' www.phd.com/ and www.scienceinsport.com/
digital platforms, third-party online sites, including Amazon and eBay, and
extensive retail distribution in the UK and internationally, including major
supermarkets, high street chains and specialist sports retailers. This
omnichannel footprint enables SiS to address the full breadth of the sports
nutrition market.
PhD is one of the UK's leading active nutrition brands with a reputation for
high quality and product innovation. The brand has grown rapidly since its
launch in 2005. The range now comprises powders, bars, and supplements,
including the high protein, low sugar range, PhD Smart.
SiS, was founded in 1992, and has a core range comprising gels, powders and
bars focused on hydration and recovery. It is an official endurance nutrition
supplier to multiple professional teams, organisations and clubs worldwide.
9. Directors, management, employees, research and development and
locations
Bidco's strategic plans for SiS
Bidco believes that the Acquisition represents an attractive opportunity to
partner with SiS to realise the potential of SiS' next phase of growth.
Bidco has spent a significant amount of time with senior management during
which the key focus has been to understand and evaluate management's strategic
vision for the business and assess their operational plans for the business in
the near and medium term. Following a thorough assessment, Bidco is highly
supportive of management's plans that are either currently in action or set to
be implemented in due course. In the near-term, this includes the following
initiatives:
· Continue the journey of returning to profitable growth by
building a stronger operating platform, resulting in enhanced margins and cash
generation;
· Support management's review of cost rationalisation actions
disclosed in the interim results for the six months ended June 2024 (the "2024
Interim Results") on 16 September 2024;
· Drive development of the UK omnichannel strategy alongside
strengthened distribution agreements both domestically and internationally;
· Build on the strength of PhD and SiS brands through new product
launches; and
· Implement effective marketing strategies with clear commercial
execution.
Bidco believes there are further opportunities to accelerate SiS' growth and
strategic objectives, which may include portfolio rationalisation, supply
chain consolidation, working capital optimisation, and may also include
executing acquisitions and / or disposals. Save for such potential portfolio
rationalisation and M&A, Bidco does not intend to make any material
changes to SiS' fixed assets or asset base.
In addition, Bidco is considering other initiatives which it believes would
accelerate the existing growth plans of SiS, which include:
· Focusing on its core proposition to elite athletes in the UK and
internationally;
· Expanding its international presence through both direct and
distributor-led channels; and
· Continuing operational and financial improvement initiatives.
Employees and management
Bidco has been highly impressed by the skills and capabilities of SiS' senior
management team and employees. It views the leadership team and employees as
the key drivers behind SiS' successful transformation to date and as essential
to achieving profitable growth in future.
Bidco intends to protect the existing statutory and contractual employment
rights, including pension rights, of the employees and management of SiS.
Bidco notes that there were a number of significant cost rationalisation
actions undertaken throughout FY24 which may continue in FY25 as outlined in
the 2024 Interim Results and may have an impact on headcount. Key actions,
both completed and ongoing by SiS' management, include, amongst others:
· A restructuring of the executive and leadership team with several
senior roles exiting the business;
· The resetting of marginal revenue channels and implementation of
certain measures to secure and grow the SiS Group's profitable revenue
streams;
· Supplier and operational reviews, in conjunction with product
inventory rationalisation, intended to further drive profitability and cash
generation in the business;
· Whilst brand health is robust, a significant number of
uncommercial marketing contracts have been exited and further savings are
expected to made throughout 2025; and,
· A significant rationalisation of product stock keeping units
across both brands is already in progress, intended to simplify the operation
and improve the working capital position whilst prioritising the needs of SiS'
customers.
Bidco does not intend to make any changes to the existing plans put in place
by SiS' management team that may lead to any further adjustment to SiS'
overall headcount.
Bidco does not envisage any material change to the conditions of employment or
to the balance of skills and functions, of the employees and management of
SiS.
With effect from the Effective Date, Bidco expects that the current
non-executive directors of SiS will resign from SiS. Bidco also anticipates
the termination of certain third-party corporate and support services which
are only required due to SiS's current admission to trading on AIM. This is
not expected to result in a material reduction to SiS's headcount.
Incentive arrangements
Following the Scheme becoming Effective, Bidco intends to review the
management, governance and incentive structure of SiS. Other than the Rollover
Arrangements, Bidco has not entered into, and has not discussed, any form of
incentivisation arrangements with members of SiS' management team or other
employees, nor will it enter into any such discussions prior to the completion
of the Acquisition. Bidco intends to put in place appropriate incentive
arrangements for the management of SiS following completion of the
Acquisition.
Existing rights and pension schemes
Bidco does not intend to make any material changes to the conditions of
employment of the SiS management and employees. Bidco confirms that, following
the Effective Date, the existing contractual and statutory employment rights,
including in relation to pensions, of all SiS employees will be fully
safeguarded in accordance with applicable law. SiS does not operate or
contribute to any defined benefit pension scheme.
Locations of business, fixed assets, headquarters and research and development
SiS' headquarters are in London, England, and SiS currently operates a
production facility at a site in Blackburn, England where the majority of its
operations and employees are based. Following the completion of the
Acquisition, it is envisaged that the main operations will continue from the
production facility at SiS' existing location.
SiS has an existing research and development function. Bidco has no plans to
change this function.
Fixed assets
Bidco does not envisage any redeployment of SiS' fixed asset base, above and
beyond any ordinary course of development required for SiS to execute its
strategy (as outlined above).
Trading facilities
SiS Shares are currently admitted to trading on AIM. Prior to the Scheme
becoming Effective, it is intended that an application will be made to the
London Stock Exchange to cancel the admission of the SiS Shares to trading on
AIM with effect from or shortly following the Effective Date. It is intended
that dealings in SiS Shares will be suspended on the morning of the Effective
Date at a time to be set out in the Scheme Document.
It is also intended that SiS will be re-registered as a private limited
company and for this to take effect as soon as practicable following the
Effective Date.
No statement in this paragraph 9 is a "post-offer undertaking" for the
purposes of Rule 19.5 of the Code.
10. SiS Share Option Plan
Any participants in the SiS Share Option Plan holding outstanding awards will
be contacted regarding the effect of the Acquisition on their rights under the
SiS Share Option Plan and appropriate proposals will be made to such
participants in due course in accordance with Rule 15 of the Code. Details of
those proposals will be set out in the Scheme Document.
11. SiS Subsidiary Shares, Rollover Arrangements, Cash Bonuses and Trust
Payments
Bidco has agreed with each of the Rolling Managers and Gomrath, the terms of
their participation in the equity of the Wider Bidco Group following the
successful completion of the Acquisition, subject to the approval of the
Scheme Shareholders, as set out in this paragraph 11. The Bidco Directors
believe that the ongoing participation of the Rolling Managers and Gomrath is
an important element of the Acquisition, and are pleased that the Rolling
Managers will continue as employees of and investors in the Wider Bidco Group
following completion of the Acquisition.
SiS Subsidiary Shares are held by the SiS Subsidiary Manager Shareholders on
terms which entitle the holders of SiS Subsidiary Shares to exchange those
shares for SiS Shares pursuant to the terms on which the SiS Subsidiary Shares
were issued.
The Rolling Managers and Gomrath (but not BUW or the Elidor Trust) also hold
SiS Shares as at the Latest Practicable Date.
The Rolling Managers, BUW and Gomrath have entered into a number of agreements
with Bidco to effect the Rollover Arrangements, as set out below.
BUW is not a Rolling Manager and is not participating in any of the Rollover
Arrangements or in the equity of the Wider Bidco Group. BUW is party to the
Share Exchange and Equity Terms Deed (the terms of which are summarised below)
solely for the purpose of documenting the exercise of the put and call option
pursuant to the SiS Subsidiary Put and Call Options in respect of the SiS
Subsidiary Shares held by her and the acquisition by Bidco of the SiS Shares
that will be issued to her following that exercise. As at the Latest
Practicable Date, BUW does not hold any SiS Shares.
Share Exchange and Equity Terms Deed
Under the terms of the Share Exchange and Equity Terms Deed, and subject to
the exercise of put and call options under the SiS Subsidiary Put and Call
Options in respect of the SiS Subsidiary Shares, for which the SiS Subsidiary
Manager Shareholders will receive SiS Shares in consideration, Bidco will
acquire all of the SiS Shares held by the Rolling Managers, BUW and the DW
Shareholding Entities in exchange for cash and Bidco Rollover Notes in the
case of the Rolling Managers and Gomrath, and cash only in the case of BUW and
the Elidor Trust.
The SiS Shares (including those to be acquired pursuant to the SiS Subsidiary
Put and Call Options) which are subject to the Share Exchange and Equity Terms
Deed are excluded from the Scheme. The Rolling Managers and Gomrath will not
be entitled to vote their SiS Shares at the Court Meeting or on the Rollover
and Bonuses Resolution at the General Meeting.
The Share Exchange and Equity Terms Deed also sets out the terms on which,
amongst other things, the Rolling Managers and Gomrath will hold their
investment in Topco in the form of ordinary and preference shares following,
but subject to, the completion of a series of steps provided for by the SiS
Subsidiary Put and Call Options and the Put and Call Option Deed (the terms of
which are summarised below).
SiS Subsidiary Put and Call Options and Put and Call Option Deed
The SiS Subsidiary Put and Call Options provide, following the exercise of a
put or call option, for the transfer by the SiS Subsidiary Manager
Shareholders of the SiS Subsidiary Shares to SiS in exchange for the issuance
of SiS Shares to the SiS Subsidiary Manager Shareholders on completion of the
put or call option in accordance with its terms.
Following the completion of the exercise of the put and call options under the
SiS Subsidiary Put and Call Options, and the transfer of the SiS Shares under
and in accordance with the Share Exchange and Equity Terms Deed, the Put and
Call Option Deed provides: (i) following the exercise of a put or call option,
for the transfer by the Rolling Managers and Gomrath of the Bidco Rollover
Notes to Midco in consideration for loan notes issued by Midco; and (ii)
subsequently, following the exercise of a put or call option, for the transfer
by the Rolling Managers and Gomrath of the loan notes issued by Midco to
Topco, in consideration for shares issued by Topco.
The Rolling Managers, Gomrath, bd-capital and Topco have agreed the principal
terms on which the Rolling Managers and Gomrath will hold securities in the
Bidco Group and these terms are set out in the Share Exchange and Equity Terms
Deed (the key terms of which are summarised in Appendix IV to this
Announcement).
Following the Effective Date, the Rolling Managers and Gomrath will hold, in
aggregate, approximately 3.05 per cent. of the ordinary share capital of Topco
and 3.05 per cent. of the preference share capital of Topco. The Share
Exchange and Equity Terms Deed includes undertakings by the Rolling Managers,
BUW and the DW Shareholding Entities to, among other things (as applicable):
(i) vote in favour (or procure a vote in favour) of the Special Resolution at
the General Meeting (and not to vote at the Court Meeting or on the Rollover
and Bonuses Resolution to be proposed at the General Meeting) (to the extent
they hold SiS Shares at the Scheme Voting Record Time); (ii) not sell,
transfer, charge, encumber, pledge or grant any option over or otherwise
dispose of their SiS Shares or SiS Subsidiary Shares, other than pursuant to
the Share Exchange and Equity Terms Deed; (iii) not accept and/or not vote in
favour of any competing scheme of arrangement or any other offer or similar
transaction in respect of any of their SiS Shares which might frustrate the
Acquisition or any part of it; and (iv) not enter into any agreement or
arrangement to participate in the capital of any person in connection with or
following any transaction relating to SiS or its assets or any arrangement
which would fall under Rule 16.2(c) of the Code (subject to certain
exceptions). Further details of these undertakings are set out in Appendix III
to this Announcement.
Following the Scheme becoming Effective, Bidco intends to review the
management, governance and incentive structure of SiS. Other than the Rollover
Arrangements, Bidco has not entered into, and has not had any discussions on,
any form of incentivisation or other arrangements with members of SiS'
management team or other employees, nor will it enter into any such
discussions prior to the completion of the Acquisition. It is the intention of
Bidco to put in place appropriate arrangements for the management of SiS
following completion of the Acquisition.
Bonuses and payments
The SiS Remuneration Committee has approved the following cash bonuses to be
paid by SiS to the executive directors of SiS upon the Scheme becoming
Effective: Daniel Wright - £580,616 (the "DW Cash Bonus"); Chris Welsh -
£34,154; and Daniel Lampard - £68,308 (together, the "Cash Bonuses").
The SiS Remuneration Committee also intends to make a recommendation to the
trustee of SiS' employee benefit trust that it makes the following payments to
the executive directors of SiS following the Scheme becoming Effective using
the cash proceeds it receives from the sale of SiS Shares pursuant to the
Acquisition: Daniel Wright - £564,572; Chris Welsh - £4,321; and Daniel
Lampard - £7,201 (together, the "Trust Payments").
In determining the amount of the Cash Bonuses and the Trust Payments proposed
to each of the executive directors of SiS, the SiS Remuneration Committee took
account of, inter alia, the material transformation of SiS since the
fundraising undertaken in July 2024 and the revised strategy implemented by
the current executive leadership team, the executive directors' performance
and their contribution to the Acquisition, including significant financial
commitment to the future success of SiS (which was a condition of Bidco's
commitment to proceed with the Acquisition), as well as the significant value
creation for SiS Shareholders. In addition, in the case of Daniel Wright, the
SiS Remuneration Committee considered that he has provided time commitment,
deep restructuring experience and strategic value beyond that envisaged at the
time of his appointment as Executive Chairman of SiS on the reduced annual
salary of £80,000.
The SiS Remuneration Committee carefully considered the Rollover Arrangements,
the Cash Bonuses and the Trust Payments in the round and were of the opinion
that these should not be considered in isolation. The aggregate amount of the
awards approved by the SiS Remuneration Committee to the different Rollover
Managers has been determined on the basis of individual performance,
circumstances and prior events. The SiS Remuneration Committee will review
and consider the short and long term remuneration of the individual Rolling
Managers and, in particular Daniel Wright, if this Acquisition does not
proceed to ensure each individual is appropriately and fairly remunerated.
The Cash Bonuses and the Trust Payments will be subject to required deductions
on account of income tax and employee National Insurance contributions.
The Cash Bonuses are considered a related party transaction under Rule 13 of
the AIM Rules. The Independent Directors consider that, having consulted with
Panmure Liberum, in its capacity as SiS' nominated adviser, the award of the
Cash Bonuses are fair and reasonable insofar as SiS Shareholders are
concerned.
Rollover and Bonuses Resolution
Other than the Rollover Arrangements and the irrevocable undertakings referred
to above and in paragraph 6 above, there are currently no arrangements or
understandings between Bidco and/or any person acting in concert with Bidco
and the management or directors of SiS having any connection with or
dependence upon the Acquisition. Nor has Bidco and/or any person acting in
concert with Bidco played any part in the decision-making process for the Cash
Bonuses or the Trust Payments.
As a condition to the Acquisition, the SiS Independent Shareholders will be
asked at the General Meeting to approve the Rollover Arrangements, Cash
Bonuses and Trust Payments by a simple majority voting in favour of the
Rollover and Bonuses Resolution, which will be proposed as an ordinary
resolution. Pursuant to Rule 16.2 of the Code, none of the Rolling Managers,
Gomrath, nor their respective connected persons, nor any person holding SiS
Shares on behalf of any of them will be entitled to vote on the Rollover and
Bonuses Resolution. Voting on the Rollover and Bonuses Resolution will be by
way of a poll. The passing of the Rollover and Bonuses Resolution is a
non-waivable condition to the Acquisition becoming Effective and is not
subject to Rule 13.5(a) of the Code.
As part of the Rollover Arrangements, subject to receipt of invoices, Bidco
will pay for the Rolling Managers' reasonable third-party fees incurred in
relation to the Rollover Arrangements, up to a maximum aggregate amount of
£100,000 plus value-added tax (but inclusive of any other relevant taxes) and
disbursements. Bidco will also procure that a grossed-up bonus is paid to the
Rolling Managers to cover any benefit in kind charge arising on the settlement
of these third-party fees on their behalf.
Further details of the terms of the Rollover Arrangements will be set out in
the Scheme Document.
SiS Independent Directors Recommendation of the Rollover and Bonuses
Resolution
The SiS Independent Directors intend to recommend unanimously that the SiS
Independent Shareholders vote in favour of the Rollover and Bonuses Resolution
at the General Meeting (or, in the event that the Acquisition is implemented
by way of a Takeover Offer, that SiS Shareholders accept or procure
acceptances of such Takeover Offer), as the SiS Independent Directors who hold
SiS Shares have irrevocably undertaken to do in respect of their own entire
beneficial holdings of SiS Shares, amounting, in aggregate, to 224,437 SiS
Shares representing approximately 0.10 per cent. of the issued share capital
of SiS as at the Latest Practicable Date. As required by, and solely for the
purposes of, Rule 16.2 of the Code, Panmure Liberum (in its capacity as
independent adviser to SiS for the purposes of Rule 3 of the Code) has
reviewed the terms of the Rollover Arrangements, Cash Bonuses and Trust
Payments and considers that the terms of the Rollover Arrangements, Cash
Bonuses and Trust Payments are fair and reasonable, so far as the SiS
Independent Shareholders are concerned. In forming this view, Panmure Liberum
has taken into account the commercial assessments of the SiS Independent
Directors.
12. Financing of the Acquisition
The cash consideration payable by Bidco pursuant to the terms of the
Acquisition will be funded through equity financing of £79.6 million in
aggregate. In connection with the equity financing of Bidco, the Investor has
entered into an Equity Commitment Letter with Bidco.
The financing for the cash consideration will comprise solely of cash to be
drawn from funds, vehicles and/or accounts advised and/or managed by
bd-capital.
Bidco may look to finance part of its funding commitments with one or more
providers of debt finance either before or after the Scheme becomes Effective.
If any such financing occurs prior to the Scheme becoming Effective, an
announcement will be made by Bidco in respect of this through a Regulatory
Information Service. Further information on any applicable financing of the
Acquisition will be set out in the Scheme Document.
In accordance with Rule 2.7(d) of the Code, Investec, in its capacity as
financial adviser to Bidco, is satisfied that sufficient resources are
available to Bidco to enable it to satisfy in full the cash consideration
payable to SiS Shareholders under the terms of the Acquisition.
13. Offer-related arrangements
Confidentiality Agreement
bd-capital and SiS entered into a confidentiality agreement on 11 February
2025 (the "Confidentiality Agreement") pursuant to which, amongst other
things, bd-capital has undertaken to: (i) keep certain information relating to
SiS confidential, (ii) not to disclose it to third parties (other than
permitted parties); and (iii) to use such confidential information only in
connection with the Acquisition. The confidentiality obligations remain in
force until the earlier of: (i) if the Acquisition is implemented by way of a
Scheme, such Scheme becoming effective in accordance with its terms; (ii) if
the Acquisition is implemented by way of Takeover Offer, bd-capital or any
member of the bd-capital group acquiring 50 per cent. or more of the issued
share capital of SiS; or (iii) 11 February 2027, being the date falling 24
months from the date of the Confidentiality Agreement. The Confidentiality
Agreement includes standstill obligations which restrict bd-capital, members
of the bd-capital group and persons acting in concert with any of them from
acquiring or offering to acquire interests in certain securities of SiS; those
restrictions ceased to apply on the making of this Announcement. The
Confidentiality Agreement also contains restrictions on bd-capital, members of
the bd-capital group and any of their respective directors, officers,
employees, advisers, agents, consultants and potential providers of finance
from soliciting or employing certain employees or officers of SiS (subject to
customary exclusions), or soliciting or contacting a customer, client or
supplier of SiS (so far as bd-capital is aware) for a period of 18 months from
the date of the Confidentiality Agreement.
14. Structure of and Conditions to the Acquisition
It is intended that the Acquisition will be effected by means of a
Court-sanctioned scheme of arrangement between SiS and the Scheme Shareholders
under Part 26 of the Companies Act, further details of which are contained in
this Announcement and full details of which will be set out in the Scheme
Document. The purpose of the Scheme (together with the Rollover Arrangements
and the Share Exchange and Equity Terms Deed) is to provide for Bidco to
become the owner of the entire issued and to be issued ordinary share capital
of SiS. The procedure involves, among other things, an application by SiS to
the Court to sanction the Scheme, in consideration for which Scheme
Shareholders who are on the register of members at the Scheme Record Time will
receive cash on the basis described in paragraph 2 of this Announcement.
Any SiS Shares held by Scheme Shareholders issued before the Scheme Record
Time will be subject to the terms of the Scheme. The Special Resolution to be
proposed at the General Meeting will, among other matters, provide that the
SiS Articles be amended to incorporate provisions requiring any SiS Shares
issued or transferred after the Scheme Record Time (other than to Rolling
Managers, the DW Shareholding Entities, BUW or Bidco and/or their or its
nominee(s)) to be automatically transferred to Bidco on the same terms as the
Acquisition (other than terms as to timings and formalities). The provisions
of the SiS Articles (as amended) will avoid any person (other than Bidco)
holding shares in the capital of SiS after the Effective Date.
The Acquisition is subject to the Conditions and certain further terms
referred to in Appendix I to this Announcement and 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
11:59 p.m. (London time) on the Long Stop Date (or such later date as Bidco
and SiS may, with the consent of the Panel, agree and, if required, the Court
may allow):
· approval of the Scheme by a majority in number of the Scheme
Shareholders who are present and vote (and are entitled to vote), whether in
person or by proxy, at the Court Meeting or at any adjournment thereof and who
represent not less than 75 per cent. in value of the Scheme Shares voted by
those Scheme Shareholders;
· the Rollover and Bonuses Resolution is passed at the General
Meeting or at any adjournment thereof by the SiS Independent Shareholders
representing a simple majority of the votes cast, whether in person or by
proxy, on that resolution at the General Meeting;
· the Special Resolution is passed at the General Meeting or at any
adjournment thereof by no less than the requisite 75 per cent. of the votes
cast, whether in person or by proxy, on that resolution at the General
Meeting;
· the Scheme is sanctioned by the Court (without modification, or
with modification on terms agreed by Bidco and SiS); and
· the Scheme becoming Effective by no later than 11.59 p.m. (London
time) on the Long Stop Date.
The Scheme will become Effective at the time and date to be stated in the
Court Order. 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 SiS Meetings (and if they attended and voted, whether or not they voted in
favour of the resolutions proposed at those meetings); and (ii) share
certificates in respect of SiS Shares will cease to be valid and entitlements
to SiS Shares held within the CREST system will be cancelled. The
consideration payable under the Scheme will be despatched to Scheme
Shareholders by Bidco no later than 14 days after the Effective Date.
The SiS Shares held by the Rolling Managers, BUW and the DW Shareholding
Entities (including those to be acquired pursuant to the SiS Subsidiary Put
and Call Options) are subject to the Share Exchange and Equity Terms Deed and
are Excluded Shares which are not subject to the Scheme. The Rolling Managers
and Gomrath are not eligible to vote at the Court Meeting or to vote on the
Rollover and Bonuses Resolution at the General Meeting.
The Scheme will lapse and the Acquisition will not take place if:
· the Court Meeting or the General Meeting are not held on or
before the 22nd day after the expected date of such SiS Meetings, to be set
out in the Scheme Document in due course;
· the Sanction Hearing is not held on or before the 22nd day after
the expected date of the Sanction Hearing, to be set out in the Scheme
Document in due course; or
· the Scheme does not become Effective on or before 11:59 p.m.
(London time) on the Long Stop Date,
provided, however, that the deadlines for the timing of the Court Meeting, the
General Meeting and the Sanction Hearing as set out above and to be set out in
the Scheme Document in due course, may be waived by Bidco, and the Long Stop
Date may be extended by: (i) agreement in writing between Bidco and SiS; or
(ii) (in a competitive situation) Bidco with the consent of the Panel, and in
each case that, if so required, the Court may allow.
If any of the dates and/or times in the Scheme Document change, the revised
dates and/or times will be notified to SiS Shareholders by announcement
through a Regulatory Information Service, with such announcement being made
available on SiS' website at https://www.sisplc.com/possible-offer/./.
It is expected that the Scheme Document, together with the Forms of Proxy for
use in connection with the SiS Meetings, will be published as soon as
practicable and in any event within 28 days of the date of this Announcement
(or such later date as may be agreed by Bidco and SiS with the consent of the
Panel).
Subject, amongst other things, to the satisfaction or waiver of the
Conditions, it is expected that the Scheme will become Effective no later than
July 2025. An expected timetable of principal events relating to the
Acquisition will be included in the Scheme Document.
The Scheme will be governed by English law and will be subject to the
jurisdiction of the Court. The Scheme will be subject to the applicable
requirements of the Code, the Panel, the AIM Rules, the London Stock Exchange,
the Court and the FCA.
15. Cancellation of admission to trading on AIM and re-registration
Prior to the Scheme becoming Effective, it is intended that SiS will make an
application to the London Stock Exchange for the admission of the SiS Shares
to trading on AIM to be cancelled with effect from or shortly after the
Effective Date.
The last day of dealings in SiS Shares on AIM is expected to be the Business
Day immediately prior to the Effective Date and no transfers will be
registered after 6.00 p.m. (London time) on that date.
On the Effective Date, share certificates held by Scheme Shareholders in
respect of Scheme Shares shall cease to be valid and should be destroyed. In
addition, entitlements to SiS Shares held in CREST shall be cancelled on the
Effective Date.
It is also proposed that, following the Effective Date and after the
cancellation of trading of the SiS Shares on AIM, SiS will be re-registered as
a private limited company under the relevant provisions of the Companies Act.
16. Disclosure of interests in SiS
Save in respect of: (i) the irrevocable undertakings referred to in paragraph
6 above; and (ii) the Rollover Arrangements, as at the close of business on
the Latest Practicable Date, neither Bidco, nor any of the Bidco Directors,
nor, so far as Bidco is aware, any person acting, or presumed to be acting, in
concert (within the meaning of the Code) with it: (i) has any interest in or
right to subscribe for any relevant securities of SiS; (ii) has any short
positions in respect of SiS Shares (whether conditional or absolute and
whether in the money or otherwise), including any short positions under a
derivative, any agreement to sell, any delivery obligation or right to require
another person to purchase or take delivery of relevant securities of SiS;
(iii) is party to any dealing arrangement of the kind referred to in Note 11
on the definition of acting in concert in the Code, in relation to relevant
securities of SiS; (iv) has borrowed or lent any relevant SiS securities
(including, for these purposes, any financial collateral arrangements of the
kind referred to in Note 4 on Rule 4.6 of the Code), save for any borrowed
shares which had been either on-lent or sold; or (v) has procured an
irrevocable undertaking or letter of intent to accept the terms of the
Acquisition in respect of relevant securities in SiS.
'Interests in securities' for these purposes 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). In particular, 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.
Furthermore, save for the irrevocable undertakings described above, no
arrangement(s) exists between Bidco and SiS or a person acting in concert with
Bidco and SiS in relation to SiS Shares. For these purposes, an "arrangement"
includes any indemnity or option arrangement, and any agreement or any
understanding, formal or informal, of whatever nature, relating to SiS Shares
which may be an inducement to deal or refrain from dealing in such securities.
In the interests of secrecy prior to this Announcement, it has not been
possible for Bidco to make enquiries of all of its concert parties in advance
of the release of this Announcement. Therefore, if Bidco becomes aware,
following the making of such enquiries, that any of its concert parties have
any interests in relevant securities of SiS, all relevant details in respect
of Bidco's concert parties will be included in Bidco's Opening Position
Disclosure in accordance with Rule 8.1(a) and Note 2(a)(i) on Rule 8 of the
Code.
17. Right to switch to a Takeover Offer
Bidco reserves the right to elect (with the consent of the Panel) to implement
the Acquisition by way of a Takeover Offer for the entire issued and to be
issued share capital of SiS as an alternative to the Scheme.
In such event, the Takeover Offer shall be implemented on the same terms and
conditions, so far as applicable, or, if Bidco so decides, such other terms
being no less favourable, as those which would apply to the Scheme subject to
appropriate amendments to reflect the change in method of effecting the
Acquisition, including (without limitation) the inclusion of an acceptance
condition set at a level permitted by the Panel, being in any case more than
50 per cent. of the voting rights normally exercisable at a general meeting of
SiS, including, for this purpose, any such voting rights attaching to SiS
Shares that are issued before the Takeover Offer becomes or is declared
unconditional, whether pursuant to the exercise of any outstanding
subscription or conversion rights or otherwise.
Further, if the Acquisition is effected by way of a Takeover Offer, and if
sufficient acceptances of the Takeover Offer are received and/or sufficient
SiS Shares are otherwise acquired, and the Takeover Offer becomes or is
declared unconditional in all respects, it is the intention of Bidco to apply
the provisions of the Companies Act to acquire compulsorily any outstanding
SiS Shares to which such Takeover Offer relates.
18. Consents
Investec and Panmure Liberum have each given and not withdrawn their consent
to the publication of this Announcement with the inclusion herein of the
references to their names in the form and context in which they appear.
19. General
In deciding whether or not to vote or procure votes to approve the Scheme at
the Court Meeting or to vote or procure votes in favour of the Resolutions at
the General Meeting in respect of their SiS Shares, SiS Shareholders should
rely on the information contained, and follow the procedures described, in the
Scheme Document.
The bases and sources for certain financial information contained in this
Announcement are set out in Appendix II to this Announcement. Details of the
irrevocable undertakings received by Bidco and given by the SiS Directors and
certain SiS Shareholders are set out in Appendix III to this Announcement. A
summary of the key terms of certain securities in the Bidco Group is set out
in Appendix IV to this Announcement. The defined terms used in this
Announcement are set out in Appendix V to this Announcement.
20. Documents available on website
In accordance with Rule 26.2 of the Code, copies of the following documents
shall be made available by no later than 12 noon (London time) on the Business
Day following the date of this Announcement on SiS' website at
https://www.sisplc.com/possible-offer// until completion of the Acquisition:
· this Announcement;
· the irrevocable undertakings described in paragraph 6 of this
Announcement and in Appendix III to this Announcement;
· the documents relating to the Rollover Arrangements summarised in
paragraph 11 of this Announcement, being the Share Exchange and Equity Terms
Deed, and the Put and Call Option Deed;
· the Equity Commitment Letter relating to the financing of the
Acquisition referred to in paragraph 12 above;
· the Confidentiality Agreement summarised in paragraph 13 of this
Announcement; and
· the consent letters from each of Investec and Panmure Liberum
referred to in paragraph 18 of this Announcement.
None of the content of any of the websites referred to in this Announcement
nor the content of any website accessible from hyperlinks is incorporated
into, or forms part of, this Announcement.
Enquiries:
Investec (Financial Adviser to bd-capital and Bidco) +44 (0) 20 7597 4000
Oliver Cardigan
Maria Gomez de Olea
Joanna Langley
Panmure Liberum (Financial Adviser, Rule 3 Adviser, Nominated Adviser and +44 (0) 20 3100 2000
Broker to SiS)
Investment Banking:
Bidhi Bhoma
Edward Thomas
John More
Joshua Borlant
M&A:
Tim Medak
Addleshaw Goddard LLP is acting as legal adviser to SiS in connection with the
Acquisition. Stephenson Harwood LLP is acting as legal adviser to bd-capital
and Bidco in connection with the Acquisition.
Important Notices
Investec Bank plc ("Investec"), which is authorised in the United Kingdom by
the Prudential Regulation Authority (the "PRA") and regulated in the United
Kingdom by the PRA and the FCA, is acting exclusively for bd-capital and Bidco
as financial adviser and no one else in connection with the matters referred
to in this Announcement and will not regard any other person as its client in
relation to such matters and accordingly will not be responsible to anyone
other than bd-capital and Bidco for providing the protections afforded to
clients of Investec, nor for providing advice in relation to any matter
referred to in this Announcement. Neither Investec 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
Investec in connection with the matters referred to in this Announcement, any
statement contained herein or otherwise. Apart from the responsibilities and
liabilities, if any, which may be imposed on Investec by the Financial
Services and Markets Act 2000, 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 Investec nor any of its subsidiaries, branches or
affiliates accepts any responsibility or liability whatsoever for the contents
of this Announcement or for the omission of any material information for which
it is not responsible, and no representation or warranty, 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 the Acquisition or the matters described in
this Announcement. To the fullest extent permitted by applicable law,
Investec, its subsidiaries, branches and its affiliates accordingly disclaim
all and any responsibility or liability whether arising in tort, contract or
otherwise (save as referred to above in this paragraph) which they might
otherwise have in respect of this Announcement, or any statement contained
herein.
Panmure Liberum Ltd ("Panmure Liberum"), which is authorised and regulated by
the FCA in the United Kingdom, is acting as adviser for the purposes of Rule 3
of the Code and financial adviser to SiS and no one else in connection with
the matters referred to in this Announcement and will not be responsible to
anyone other than SiS for providing the protections afforded to clients of
Panmure Liberum, or for providing advice in relation to the matters referred
to in this Announcement. Neither Panmure 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 Panmure Liberum in connection with the
matters referred to in this Announcement, any statement contained 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 an offer, invitation or the solicitation
of an offer to purchase, otherwise acquire, subscribe for, sell or otherwise
dispose of any securities, or the solicitation of any vote or approval in any
jurisdiction, pursuant to the Acquisition or otherwise, nor shall there be any
sale, issuance or transfer of securities of SiS in any jurisdiction in
contravention of applicable law. The Acquisition will be made solely pursuant
to the terms of the Scheme Document (or, if the Acquisition is to be
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 SiS Shareholders may vote in respect of the Acquisition. Any vote,
approval, decision in respect of, or other response to, the Acquisition should
be made only on the basis of the information contained in the Scheme Document
(or any other document by which the Acquisition is made by way of a Takeover
Offer).
The statements contained in this Announcement are made as at the date of this
Announcement, unless some other time is specified in relation to them, and the
release of this Announcement shall not give rise to any implication that there
has been no change in the facts set out in this Announcement since such date.
This Announcement does not constitute a prospectus or prospectus equivalent or
exempted document.
No person should construe the contents of this Announcement as legal,
financial or tax advice. 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, accountant or from an independent financial adviser duly
authorised under FSMA if you are resident in the United Kingdom, or another
appropriately authorised independent financial adviser, if you are in a
territory outside the United Kingdom.
Overseas Shareholders
This Announcement has been prepared for the purpose of complying with English
law, the Code, UK MAR, the Disclosure Guidance and Transparency Rules and the
AIM Rules 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 of jurisdictions outside England. Nothing in this Announcement
should be relied on for any other purpose.
The release, publication or distribution of this Announcement in or into
certain jurisdictions other than the United Kingdom may be restricted by the
laws and/or regulations of those jurisdictions and therefore persons into
whose possession this Announcement comes who are subject to the laws and/or
regulations of any jurisdiction other than the United Kingdom should inform
themselves about and observe any such applicable laws and/or regulations in
their jurisdiction. In particular, the ability of persons who are not resident
in the United Kingdom or who are subject to the laws of another jurisdiction
to participate in the Acquisition or to vote their SiS Shares with respect to
the Scheme at the Court Meeting, the Resolutions at the General Meeting, or to
execute and deliver Forms of Proxy appointing another person as proxy to vote
at the Court Meeting or the General Meeting on their behalf, may be affected
by the laws of the relevant jurisdiction in which they are located or to which
they are subject. Any failure to comply with such restrictions may constitute
a violation of the securities laws of 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 Code, and permitted by
applicable law and regulation, the Acquisition shall not be made available, in
whole or in part, directly or indirectly, in, into or from a Restricted
Jurisdiction where to do so would violate the laws or regulations in that
jurisdiction and no person may vote in favour of the Acquisition by any such
use, means, instrumentality or from within a Restricted Jurisdiction or any
other jurisdiction if to do so would constitute a violation of the laws or
regulations of that jurisdiction.
The Acquisition will be subject to the applicable requirements of English law,
the Code, the Panel, the AIM Rules, the London Stock Exchange and the FCA.
Copies of this Announcement and any formal documentation relating to the
Acquisition are not being, and must not be, directly or indirectly, mailed or
otherwise forwarded, distributed or sent in or into or from any Restricted
Jurisdiction or any jurisdiction where to do so would constitute a violation
of the laws or regulations of such jurisdiction and persons receiving such
documents (including custodians, nominees and trustees) must not mail or
otherwise forward, distribute or send them in or into or from any Restricted
Jurisdiction. Doing so may render invalid any related purported vote in
respect of the Acquisition.
Further details and information in relation to Overseas Shareholders will be
contained in the Scheme Document.
Additional information for U.S. investors
U.S. SiS Shareholders should note that the Acquisition relates to an offer for
the shares of a UK company and is being made by means of a scheme of
arrangement provided for under English company law. The Acquisition, to be
implemented by way of a scheme of arrangement, is not subject to the tender
offer rules or the proxy solicitation rules under the U.S. Exchange Act, as
amended. Accordingly, the Acquisition is subject to the requirements and
practices applicable to a scheme of arrangement involving a target company in
the UK traded on AIM, which differ from the requirements of the U.S. tender
offer and proxy solicitation rules. The financial information with respect to
SiS included in this Announcement and the Scheme Document has been, or will
have been, prepared in accordance with IFRS and thus may not be comparable to
the financial information of U.S. companies or companies whose financial
statements are prepared in accordance with generally accepted accounting
principles in the U.S. If, in the future, Bidco exercises its right to
implement the Acquisition by way of a Takeover Offer and determines to extend
the Takeover Offer into the U.S., the Acquisition will be made in compliance
with applicable U.S. tender offer rules.
It may be difficult for U.S. SiS Shareholders to enforce their rights and any
claims they may have arising under the U.S. federal securities laws in
connection with the Acquisition, since SiS and Bidco are each located in a
country other than the United States, and some or all of their respective
officers and directors may be residents of countries other than the United
States. U.S. shareholders may not be able to sue SiS, Bidco or their
respective officers or directors in a non-U.S. court for violations of the
U.S. securities laws. Further, it may be difficult to compel SiS or Bidco and
their respective affiliates to subject themselves to the jurisdiction or
judgment of a U.S. court for violations of the U.S. securities laws.
Neither the SEC nor any U.S. state securities commission has approved,
disproved or passed judgment upon the fairness or the merits of the
Acquisition or determined if this Announcement is adequate, accurate or
complete. Any representation to the contrary is a criminal offence in the
United States.
In accordance with normal United Kingdom practice and pursuant to Rule
14e-5(b) of the U.S. Exchange Act, Bidco, certain of its affiliated companies
and their respective nominees or brokers (acting as agents), may from time to
time make certain purchases of, or arrangements to purchase, shares or other
securities of SiS outside of the United States, 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 would
comply with applicable law, including the U.S. Exchange Act. Any information
about such purchases or arrangements to purchase will be disclosed as required
in the UK, will be reported to a Regulatory Information Service and will be
available on the London Stock Exchange website at www.londonstockexchange.com.
Forward-looking statements
This Announcement (including information incorporated by reference into this
Announcement), oral statements made regarding the Acquisition, and other
information published by Bidco or SiS contain statements which are, or may be
deemed to be, "forward-looking statements". All statements other than
statements of historical facts included in this Announcement, may 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 of Bidco and SiS 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 bd-capital,
Bidco, the Wider Bidco Group, SiS, the Wider SiS Group, 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 "plans", "expects" or "does not expect", "is
expected", "is subject to", "budget", "scheduled", "estimates", "forecasts",
"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 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 bd-capital's, Bidco's or
SiS' operations and potential synergies resulting from the Acquisition.
Although Bidco and SiS believe that the expectations reflected in such
forward-looking statements are reasonable, neither Bidco nor SiS can give
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 affect the future operations of the
Wider SiS Group, the Wider Bidco Group or the Enlarged Group or 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 on the proposed terms; domestic and global
business and economic conditions; the impact of pandemics, asset prices;
market-related risks such as fluctuations in interest rates and exchange
rates, industry trends, competition, changes in government and regulation,
changes in the policies and actions of governments and/or regulatory
authorities (including changes related to capital and tax), changes in
political and economic stability (including exposures to terrorist activities,
the UK's exit from the European Union, Eurozone instability, the ongoing
Russia-Ukraine conflict, the ongoing conflict in the Middle East, disruption
in business operations due to reorganisation activities, interest rate,
inflation, deflation and currency fluctuations), the timing impact and other
uncertainties of future or planned acquisitions or disposals or offers, the
inability of the Enlarged Group to realise successfully any anticipated
synergy benefits when the Acquisition is implemented (including changes to the
board and/or employee composition of the Enlarged Group), the inability of the
Bidco Group to integrate successfully the SiS Group's operations and
programmes when the Acquisition is implemented, the Enlarged Group incurring
and/or experiencing unanticipated costs and/or delays (including IT system
failures, cyber-crime, fraud and pension scheme liabilities) or difficulties
relating to the Acquisition when the Acquisition is implemented. Other unknown
or unpredictable factors could affect future operations and/or cause actual
results to differ materially from those in the forward-looking statements.
Such forward-looking statements should therefore be construed in the light of
such factors.
Each forward-looking statement speaks only as of the date of this
Announcement. Neither bd-capital, the Bidco Group, nor the SiS Group, nor any
of their respective associates or directors, officers or advisers, provides
any representation, warranty, assurance or guarantee that the occurrence of
the events expressed or implied in any forward-looking statements in this
Announcement will actually occur. Forward-looking statements involve inherent
risks and uncertainties. All forward-looking statements contained in this
Announcement are expressly qualified in their entirety by the cautionary
statements contained or referred to in this section. Readers are cautioned not
to place undue reliance on these forward-looking statements. Other than in
accordance with their legal or regulatory obligations (including under the
Code, UK MAR, the AIM Rules and the DTRs), neither bd-capital, the Wider Bidco
Group, nor the Wider SiS Group is under or undertakes any obligation, and each
of the foregoing 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.
Disclosure requirements of the Code
Under Rule 8.3(a) of the 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 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.
No profit forecasts or estimates
The SiS Profit Forecast constitutes an ordinary course profit forecast for SiS
published before the start of the Offer Period for the purposes of Note 2(a)
on Rule 28.1 of the Code. As required by Rule 28.1(c)(i) of the Code, the SiS
Profit Forecast, the assumptions on the basis of which it was compiled and the
SiS Directors' confirmations in relation to it are set out in paragraph 5 of
this Announcement.
Other than the SiS Profit Forecast, no statement in this Announcement is
intended, or is to be construed, as a profit forecast, profit estimate or
quantified financial benefits statement for any period and no statement in
this Announcement should be interpreted to mean that earnings or earnings per
share for Bidco or SiS for the current or future financial years will
necessarily match or exceed the historical published earnings or earnings per
share for Bidco or SiS.
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 a website
In accordance with Rule 26.1 of the Code, a copy of this Announcement will be
made available, subject to certain restrictions relating to persons resident
in Restricted Jurisdictions, on SiS' website at
https://www.sisplc.com/possible-offer/ by no later than 12 noon (London time)
on the first Business Day following the date of this Announcement.
For the avoidance of doubt, neither the content of this website nor the
contents of any websites accessible from any hyperlinks is incorporated into
or forms part of this Announcement.
Requesting hard copy documents
In accordance with Rule 30.3 of the Code, SiS Shareholders may request a hard
copy of this Announcement (and any information incorporated by reference in
this Announcement), free of charge, by contacting Equiniti during business
hours on 0345 607 6838 (from within the United Kingdom) and +44 121 415 7082
(from outside the United Kingdom) or by submitting a request in writing to The
Company Secretary, at Highdown House, Yeoman Way, Worthing, West Sussex, BN99
3HH . 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. Lines will be open between 9.00 a.m. to 5.30 p.m., Monday
to Friday excluding public holidays in England and Wales.
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. Such persons may also request that all future documents,
announcements and information to be sent to them in relation to the
Acquisition should be in hard copy form.
Scheme Process
In accordance with Section 5 of Appendix 7 of the Code, SiS will announce
through a Regulatory Information Service key events in the Scheme process
including the outcomes of the SiS Meetings and the Sanction Hearing.
Unless otherwise consented to by the Court and the Panel, any modification or
revision to the Scheme will be made no later than the date which is 14 days
prior to the SiS Meetings (or any later date to which such meetings are
adjourned). In accordance with Section 11 of Appendix 7 of the Code, if the
Scheme lapses or is withdrawn all documents of title and other documents
lodged will be returned as soon as practicable and in any event within 14 days
of such lapsing or withdrawal.
Electronic communications / Information relating to SiS Shareholders
Please be aware that addresses, electronic addresses and certain other
information provided by SiS Shareholders, persons with information rights and
other relevant persons for the receipt of communications from SiS may be
provided to Bidco during the Offer Period as required under Section 4 of
Appendix 4 to the Code to comply with Rule 2.11(c) of the Code.
APPENDIX I
CONDITIONS AND FURTHER TERMS OF THE SCHEME AND THE ACQUISITION
The Acquisition will be subject to the terms and conditions set out in this
Appendix and in the Scheme Document.
PART A
1. Long Stop Date
The Acquisition is conditional on the Scheme becoming unconditional and
effective, subject to the Code, by no later than 11.59 p.m. (London Time) on
the Long Stop Date.
2. Scheme approval
The Scheme will be subject to the following conditions:
(a)
i. its approval by a majority in number representing not less than 75
per cent. in value of the Scheme Shareholders, in each case present, entitled
to vote and voting, either in person or by proxy, at the Court Meeting or at
any separate class meeting which may be required by the Court (as applicable)
or at any adjournment of any such meeting; and
ii. such Court Meeting and any separate class meeting which may be
required by the Court being held on or before the 22nd day after the expected
date of the Court Meeting to be set out in the Scheme Document in due course
(or such later date as: (a) Bidco and SiS may agree; or (b) (in a competitive
situation) as may be specified by Bidco with the consent of the Panel, and in
each case that, if so required, the Court may allow);
(b)
i. the Special Resolution being duly passed by the requisite majority at
the General Meeting or at any adjournment thereof; and
ii. the General Meeting being held on or before the 22nd day after the
expected date of the General Meeting to be set out in the Scheme Document in
due course (or such later date as: (a) Bidco and SiS may agree or (b) (in a
competitive situation) as may be specified by Bidco with the consent of the
Panel, and in each case that, if so required, the Court may allow); and
(c)
i. the sanction of the Scheme by the Court with or without modification
(but subject to any such modification being acceptable to Bidco and SiS) and
the delivery of a copy of the Court Order to the Registrar of Companies (the
"Court Sanction"); and
ii. the Sanction Hearing being held on or before the 22nd day after the
expected date of the Sanction Hearing to be set out in the Scheme Document in
due course (or such later date as: (a) Bidco and SiS may agree; or (b) (in a
competitive situation) as may be specified by Bidco with the consent of the
Panel, and in each case that, if so required, the Court may allow).
In addition, Bidco and SiS have agreed that, subject to Part B below and to
the requirements of the Panel, the Acquisition will be conditional on the
following Conditions and, accordingly, the necessary actions to make the
Scheme Effective will not be taken unless the following Conditions (as
amended, if appropriate) have been satisfied or, where relevant, waived prior
to the Scheme being sanctioned by the Court:
3. Rollover and Bonuses Resolution
The Rollover and Bonuses Resolution being duly passed by the requisite
majority of SiS Independent Shareholders at the General Meeting.
4. Notifications, waiting periods and authorisations
(a) All:
i. material notifications, filings or applications in any jurisdiction
which are necessary or considered appropriate by Bidco (acting reasonably)
having been made;
ii. waiting periods (including any extensions thereof) under any
applicable legislation or regulation of any jurisdiction which are necessary
or considered appropriate by Bidco (acting reasonably) having expired, lapsed
or been terminated (as appropriate); and
iii. statutory or regulatory obligations in any jurisdiction having been
complied with,
in each case in connection with the Acquisition including, without limitation,
its implementation and financing or the proposed direct or indirect
acquisition of any shares or other securities in, or control of, SiS or any
member of the Wider SiS Group by any member of the Bidco Group;
(b) All Authorisations which are necessary or considered appropriate by
Bidco (acting reasonably) in any jurisdiction in connection with the
Acquisition which are material in the context of the Wider Bidco Group or the
Wider SiS Group as a whole or for or in respect of the Acquisition, including,
without limitation, its implementation and financing or the proposed direct or
indirect acquisition of any shares or other securities in, or control of, SiS
or any member of the Wider SiS Group by any member of the Bidco Group (other
than pursuant to Chapter 3 of Part 28 of the Companies Act) having been
obtained in terms and in a form reasonably satisfactory to Bidco from all
appropriate Third Parties or persons with whom any member of the Wider SiS
Group has entered into contractual arrangements; and
(c) All Authorisations which are necessary or considered appropriate by
Bidco (acting reasonably) to carry on the business of any member of the Wider
SiS Group in any jurisdiction which are material in the context of the Wider
Bidco Group or the Wider SiS Group as a whole or for or in respect of the
Acquisition having been obtained and remaining in full force and effect and
all filings necessary for such purpose having been made and there being no
notice or intimation of any intention to revoke, suspend, restrict, modify or
not to renew any of the same.
5. Other Third Party clearances
No Third Party having given notice of a decision to take, institute, implement
or threaten any action, proceeding, suit, investigation, enquiry 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, made
or proposed any law, rule, regulation, decision, order or change to published
practice (and, in each case, not having withdrawn the same) or having taken
any other steps, and there not continuing to be outstanding any law, rule,
regulation, decision or order, which in each case is or might reasonably be
expected to:
(a) require, prevent or materially delay the divestiture, or materially
alter the terms envisaged for any proposed divestiture by any member of the
Wider Bidco Group or any member of the Wider SiS Group of all or any portion
of their respective businesses, assets or property or impose any limitation on
the ability of any of them to conduct their respective businesses (or any part
of them) or to own, control or manage any of their respective assets or
properties or any part thereof, which, in any case, is material in the context
of the Wider Bidco Group and/or the Wider SiS Group in either case taken as a
whole or in the context of the Acquisition;
(b) require, prevent or materially delay, or alter the terms envisaged for,
any proposed divestiture by any member of the Wider Bidco Group of any shares
or other securities in any member of the Wider SiS Group or any member of the
Wider Bidco Group;
(c) impose any material limitation on, or result in a material delay in, the
ability of any member of the Wider Bidco Group to acquire or to hold or to
exercise effectively, in each case directly or indirectly, all or any rights
of ownership in respect of shares or loans or securities convertible into
shares or any other securities (or the equivalent) in any member of the Wider
SiS Group or to exercise voting or management control over any such member;
(d) otherwise adversely affect any or all of the business, assets, profits
or prospects of any member of the Wider Bidco Group or of any member of the
Wider SiS Group to an extent which is material in the context of the Wider
Bidco Group or the Wider SiS Group in either case taken as a whole or in the
context of the Acquisition;
(e) make the Acquisition or its implementation or the acquisition or
proposed acquisition by Bidco or any member of the Wider Bidco Group of any
shares or other securities in, or control or management of, SiS void, illegal
and/or unenforceable under the laws of any relevant jurisdiction, or
otherwise, directly or indirectly, restrain, restrict, prohibit or materially
delay the same, or impose additional adverse conditions or obligations with
respect thereto, or otherwise challenge, impede or interfere or require
material amendment of the Acquisition or any part thereof;
(f) require (save as envisaged in the terms of the Acquisition or sections
974 to 991 (inclusive) of the Companies Act) any member of the Wider Bidco
Group or the Wider SiS Group to offer to acquire any shares or other
securities (or the equivalent) or interest in any member of the Wider SiS
Group or any business, asset or property owned by any Third Party;
(g) impose any limitation on or result in any delay in the ability of any
member of the Wider Bidco Group to conduct, integrate or coordinate its
business, or any part of it, with the businesses or any part of the businesses
of any other member of the Wider SiS Group which is adverse to and material in
the context of the Wider SiS Group taken as a whole or in the context of the
Acquisition; or
(h) result in any member of the Wider SiS Group or any member of the Wider
Bidco Group ceasing to be able to carry on business under any name under which
it presently does so,
and all applicable waiting and other time periods (including any extensions
thereof) during which any such Third Party could decide to take, institute,
implement or threaten any action, proceeding, suit, investigation, enquiry or
reference or any other step under the laws of any jurisdiction in respect of
the Acquisition or the acquisition or proposed acquisition of any SiS Shares
or otherwise intervene having expired, lapsed or been terminated.
6. Certain matters arising as a result of any Authorisation,
arrangement etc.
Except as Disclosed, there being no provision of any Authorisation,
arrangement, lease, franchise or other instrument to which any member of the
Wider SiS 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, or any event or circumstance
which, in each case as a consequence of the Acquisition or the proposed
acquisition of any shares or other securities (or equivalent) in SiS or
because of a change in the control or management of any member of the Wider
SiS Group or otherwise, could or would reasonably be expected to result in (in
each case to an extent which is or would be material and adverse in the
context of the Wider SiS Group taken as a whole or in the context of the
Acquisition):
(a) any monies borrowed by or any other indebtedness or liabilities (actual
or contingent) of, or grant available to any member of the Wider SiS Group,
being or becoming repayable or capable of being declared repayable immediately
or earlier than their or its 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) any such agreement, arrangement, licence, permit, lease, franchise or
other instrument or the rights, liabilities, obligations or interests of any
member of the Wider SiS Group thereunder being terminated or adversely
modified or affected or any onerous obligation or liability arising or any
adverse action being taken or arising thereunder;
(c) any assets or interests of any such member being or failing to be
disposed of or charged or ceasing to be available to any member of the Wider
SiS Group or any right arising under which any such asset or interest could be
required to be disposed of or charged or could cease to be available to any
such member other than in the ordinary course of business;
(d) other than in the ordinary course of business, the creation or
enforcement of any mortgage, charge or other security interest over the whole
or any part of the business, property, assets or interest of any member of the
Wider SiS Group or any such mortgage, charge or other security interest
(whenever arising or having arisen) becoming enforceable;
(e) the rights, liabilities, obligations or interests of any member of the
Wider SiS Group under any agreement, arrangement, licence, permit, lease,
franchise or other interest in, or the business or interests of any such
member with, any person, firm, company or body (or any arrangement or
arrangements relating to any such interest or business) being or being capable
of becoming terminated, adversely modified or affected;
(f) the value or the financial or trading position or prospects of any
member of the Wider SiS Group being prejudiced or adversely affected;
(g) any member of the Wider SiS Group ceasing to be able to carry on
business under any name under which it presently does so;
(h) any liability of any member of the Wider SiS Group to make any
severance, termination, bonus or other payment to any of its directors or
other officers, save in the ordinary course of business;
(i) the creation or acceleration of any liability, actual or contingent,
by any member of the Wider SiS Group (including any tax liability or any
obligation to obtain or acquire any Authorisation from any Third Party or any
person) other than trade creditors or other liabilities incurred in the
ordinary course of business; or
(j) any requirement on any member of the Wider SiS Group to acquire,
subscribe, pay up or repay any shares or other securities (or the equivalent),
and no event having occurred which, under any provision of any agreement,
arrangement, licence, permit, lease, franchise or other instrument to which
any member of the Wider SiS Group is a party or by or to which any such member
or any of its assets may be bound, entitled or subject, would or might
reasonably be expected to result in any of the events or circumstances as are
referred to in paragraphs (a) to (j) of this Condition.
7. Certain events occurring since Last Accounts Date
Except as Disclosed, no member of the Wider SiS Group having, since the Last
Accounts Date:
(a) issued or agreed to issue, authorised or proposed or announced its
intention to authorise or propose, the issue of additional shares of any class
or transferred or sold or agreed to transfer or sell or authorised or proposed
the transfer or sale of any shares out of treasury, save as between SiS and
wholly-owned subsidiaries of SiS or pursuant to the exercise of options
granted under the SiS Share Option Plan, the award and acquisition of SiS
Subsidiary Shares or the SiS Subsidiary Put and Call Options, in each case in
accordance with the rules or applicable terms thereof;
(b) issued, or agreed to issue, authorised or proposed or announced its
intention to authorise or propose the issue of securities convertible into
shares of any class or rights, warrants or options to subscribe for, or
acquire, any such shares or convertible securities, save as between SiS and
wholly-owned subsidiaries of SiS or for the grant of options and awards and
other rights under the SiS Share Option Plan, the award of SiS Subsidiary
Shares or the SiS Subsidiary Put and Call Options in each case in accordance
with the rules or applicable terms thereof;
(c) 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) paid or
made by any wholly-owned subsidiary of SiS to SiS or any of its wholly-owned
subsidiaries;
(d) save for the Acquisition and any transactions between SiS and its
wholly-owned subsidiaries or between such wholly-owned subsidiaries,
authorised, implemented or announced any merger, demerger, reconstruction,
amalgamation or scheme or acquired or disposed of or transferred, mortgaged,
charged or created any security interest over any assets or any right, title
or interest in any asset (including shares and trade investments or the
equivalent thereof) or authorised or proposed or announced any intention to
propose any merger, demerger, reconstruction, amalgamation, scheme,
acquisition, disposal, transfer, mortgage, charge or security interest, in
each case, other than in the ordinary course of business;
(e) save for transactions between SiS and its wholly-owned subsidiaries or
between such wholly-owned subsidiaries, made or authorised or proposed or
announced an intention to propose any material change in its loan capital (or
the equivalent thereof);
(f) issued, authorised or proposed the issue of, or made any change in or
to, any debentures or (save for transactions between SiS and its wholly-owned
subsidiaries or between such wholly-owned subsidiaries or in the ordinary
course of business), incurred or increased any indebtedness or become subject
to or increased any liability (actual or contingent);
(g) purchased, redeemed or repaid or announced any proposal to purchase,
redeem or repay any of its own shares or other securities or reduced or, save
in respect to the matters mentioned in paragraph (a) or (b) above, made any
other change to any part of its share capital;
(h) 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, onerous or unusual nature or magnitude or
which is or is reasonably likely to be restrictive on the businesses of any
member of the Wider SiS Group or the Wider Bidco Group and which, in any such
case, is material in the context of the Wider SiS Group taken as a whole or in
the context of the Acquisition;
(i) been unable or deemed unable, or admitted in writing that it is
unable, to pay its debts as they fall due 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;
(j) other than in respect of a member of the Wider SiS Group which is
dormant and was solvent at the relevant time, taken or proposed any corporate
action or steps or had any legal proceedings started or threatened against it
in relation to the suspension of payments, a moratorium of any indebtedness,
its winding-up (voluntary or otherwise), dissolution or reorganisation or for
the appointment of a receiver, administrative receiver, administrator,
manager, 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 or equivalent person in any jurisdiction or had any
such person appointed;
(k) commenced negotiations with any of its creditors or taken any step, in
each case in connection with financial difficulties of the Wider SiS Group,
with a view to rescheduling or restructuring any of its indebtedness or
entered into a composition, compromise, assignment or arrangement with any of
its creditors whether by way of a voluntary arrangement, scheme of
arrangement, deed of compromise or otherwise, or entered into any agreement
with any of its creditors to refinance, reschedule or restructure any of its
indebtedness;
(l) other than in respect of claims between SiS and wholly-owned
subsidiaries of SiS or between such wholly-owned subsidiaries, waived, settled
or compromised any claim (otherwise than in the ordinary course of business),
which is material in the context of the Wider SiS Group taken as a whole or in
the context of the Acquisition;
(m) made any alteration to its constitutional or other governing or
incorporation documents (other than in connection with the Scheme);
(n) except in relation to changes made or agreed as a result of, or arising
from, law or changes to applicable law, made or agreed or consented to any
change to:
i. the terms of the trust deeds, scheme rules or other documentation
constituting the pension scheme(s) established by any member of the Wider SiS
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,
in each case, which has or is reasonably likely to have a material adverse
effect on the Wider SiS Group taken as a whole or in the context of the
Acquisition;
(o) proposed, agreed to provide or modified the terms of the SiS Share
Option Plan, SiS Subsidiary Shares, any of the SiS Subsidiary Put and Call
Options or any other benefit constituting a material change relating to the
employment or termination of employment of a material category of persons
employed by the Wider SiS Group or which constitutes a material change to the
terms or conditions of employment of any senior employee of the Wider SiS
Group, save as agreed by the Panel (if required) and by Bidco, or entered into
or changed the terms of (or made any offer (which remains open for acceptance)
to enter into or change the terms of) any contract, service agreement,
commitment or arrangement with any director or senior executive of any member
of the Wider SiS Group;
(p) terminated or varied the terms of any agreement or arrangement between
any member of the Wider SiS 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 SiS Group taken as a whole;
(q) entered into, implemented or authorised the entry into, any joint
venture, asset or profit sharing arrangement, partnership or merger of
business or corporate entities;
(r) on or after the date of this Announcement, and other than with the
consent of Bidco, taken (or agreed or proposed to take) any action which
requires, or would require, the consent of the Panel or the approval of SiS
Shareholders in a general meeting in accordance with, or as contemplated by,
Rule 21.1 of the Code; or
(s) entered into any contract, commitment, arrangement or agreement or
passed any resolution or made any offer (which remains open for acceptance)
with respect to or announced any intention to, or to propose to, effect any of
the transactions, matters or events referred to in this Condition.
8. No adverse change, litigation or regulatory enquiry
Except as Disclosed, since the Last Accounts Date:
(a) no adverse change or deterioration having occurred and no circumstances
having arisen which would or might reasonably be expected to result in any
adverse change or deterioration in the business, assets, financial or trading
position, profits, prospects or operational performance of any member of the
Wider SiS Group which, in any such case, is material in the context of the
Wider SiS Group taken as a whole or in the context of the Acquisition;
(b) no litigation, arbitration proceedings, prosecution or other legal
proceedings to which any member of the Wider SiS Group is or may become a
party (whether as a claimant, defendant or otherwise) and no enquiry, review
or investigation by, or complaint or reference to, any Third Party or other
investigative body against or in respect of any member of the Wider SiS Group,
having been instituted, announced, implemented or threatened by or against or
remaining outstanding in respect of any member of the Wider SiS Group which in
any such case has had or might reasonably be expected to have a material
adverse effect on the Wider SiS Group taken as a whole or in the context of
the Acquisition;
(c) no contingent or other liability of any member of the Wider SiS Group
having arisen or become apparent to Bidco or increased other than in the
ordinary course of business which has had or might reasonably be expected to
affect the business, assets, financial or trading position, profits or
prospects of any member of the Wider SiS Group to an extent which is material
in the context of the Wider SiS Group taken as a whole or in the context of
the Acquisition;
(d) no member of the Wider SiS Group having conducted its business in breach
of any applicable laws, rules or regulations which in any case is material in
the context of the SiS Group taken as a whole or in the context of the
Acquisition; and
(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 Authorisation held by any member of the Wider SiS Group
which is necessary for the proper carrying on of its business and the
withdrawal, cancellation, termination or modification of which has had or
might reasonably be expected to have a material adverse effect on the Wider
SiS Group taken as a whole or in the context of the Acquisition.
9. No discovery of certain matters
(a) Except as Disclosed, Bidco not having discovered, in each case to an
extent which is material in the context of the Wider SiS Group taken as a
whole or in the context of the Acquisition:
i. that any financial, business or other information concerning the
Wider SiS Group publicly disclosed at any time by or on behalf of any member
of the Wider SiS Group prior to the date of this Announcement is misleading,
contains a misrepresentation of fact or omits to state a fact necessary to
make that information not misleading;
ii. that any member of the Wider SiS Group is subject to any liability
(actual or contingent); or
iii. any information which affects the import of any information disclosed
at any time by or on behalf of any member of the Wider SiS Group and which is
material in the context of the Wider SiS Group taken as a whole or in the
context of the Acquisition.
(b) Except as Disclosed, Bidco not having discovered that:
i. any past or present member of the Wider SiS Group has failed to
comply with any and/or all applicable legislation, regulation or other
requirement, of any jurisdiction or any Authorisations with regard to the use,
treatment, handling, storage, carriage, disposal, spillage, release,
discharge, leak or emission of any waste or hazardous substance or any
substance likely to impair the environment (including property) or harm human
health or animal health or otherwise relating to environmental matters or the
health and safety of humans, or that there has otherwise been any such use,
treatment, handling, storage, carriage, disposal, spillage, release,
discharge, leak or emission (whether or not the same constituted a
non-compliance by any person with any such legislation or regulations or other
requirement, and wherever the same may have taken place) any of which use,
treatment, handling, storage, carriage, disposal, spillage, release,
discharge, leak or emission would be likely to give rise to any liability
(including any penalty for non-compliance, whether actual or contingent) or
cost on the part of any member of the Wider SiS Group;
ii. there is, or is likely to be, for any reason whatsoever, any
obligation or liability (actual or contingent) of any past or present member
of the Wider SiS Group (or on its behalf) to make good, remediate, repair,
reinstate or clean up any property, asset or any controlled waters now or
previously owned, occupied, operated or made use of or controlled by any such
past or present member of the Wider SiS Group (or on its behalf) or by any
person for which a member of the Wider SiS 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, 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;
iii. circumstances exist (whether as a result of the making of the
Acquisition or otherwise) which would be reasonably likely to lead to any
Third Party instituting, or whereby any member of the Wider Bidco Group or any
present or past member of the Wider SiS Group would be likely to be required
to institute, an environmental audit or take any other steps which would in
any such case be reasonably likely to result in any liability (whether actual
or contingent) to improve, modify existing or install new plant, machinery or
equipment or carry out changes in the processes currently carried out or make
good, remediate, repair, re-instate or clean up any land or other asset or
property of any description currently or previously owned, occupied or made
use of by any past or present member of the Wider SiS Group (or on its behalf)
or by any person for which a member of the Wider SiS 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; or
iv. circumstances exist whereby a person or class of persons would be
likely to have any claim or claims in respect of any product or process of
manufacture or materials used therein currently or previously manufactured,
sold or carried out by any past or present member of the Wider SiS Group.
10. Anti-corruption, economic sanctions, criminal property and money
laundering
Except as Disclosed, Bidco not having discovered that:
(a) any past or present member, director, officer or employee of the Wider
SiS Group or any person that performs or has performed services for or on
behalf of the Wider SiS Group is or has at any time engaged in any activity,
practice or conduct which would constitute an offence under the Bribery Act
2010, the U.S. Foreign Corrupt Practices Act of 1977 or any other applicable
anti-corruption or anti-bribery law, rule or regulation or any other
applicable law, rule or regulation concerning improper payments or kickbacks;
(b) any asset of any member of the Wider SiS 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 SiS Group is found to have
engaged in activities constituting money laundering under the Proceeds of
Crime Act 2002 or any other applicable law, rule or regulation concerning
money laundering;
(c) any past or present member, director, officer or employee of the Wider
SiS Group or any other person for whom any such person may be liable or
responsible, has engaged in any transaction or conduct which would cause any
member of the Wider SiS Group to be in breach of (or would cause Bidco or any
member of the Wider Bidco Group to be in breach of or to be reasonably likely
to become the subject of sanctions under, following completion of the
Acquisition) applicable economic sanctions of the UK, the United Nations, the
U.S., the European Union or any of its member states or any other Relevant
Authority including those administered by the United States Office of Foreign
Assets Control or HM Treasury, save that this shall not apply if and to the
extent that it is or would be unenforceable by reason of breach of any
applicable Blocking Law;
(d) any past or present member, director, officer or employee of the Wider
SiS Group or any other person for whom any such person may be liable or
responsible, has dealt with, made any investments in, made any funds or assets
available to or received any funds or assets from: (A) any government, entity
or individual in respect of which U.S., 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 U.S., UK or European Union or its members' laws or
regulations, including the economic sanctions administered by the United
States Office of Foreign Assets Control, or HM Treasury; or (B) any
government, entity or individual targeted by any of the economic sanctions of
the United Nations, the U.S., the UK, the European Union or any of its member
states, which, in each case, would cause any member of the Wider SiS Group to
be in breach of (or would cause Bidco or any member of the Wider Bidco Group
to be in breach of or to be reasonably likely to become the subject of
sanctions under, following completion of the Acquisition) any economic
sanctions laws applicable to the Wider SiS Group save that this shall not
apply if and to the extent that it is or would be unenforceable by reason of
breach of any applicable Blocking Law; or
(e) any past or present member of the Wider SiS Group or any past or present
director, officer or employee of the Wider SiS Group, or any other person for
whom any such person may be liable or responsible:
i. has engaged in conduct which would violate any relevant
anti-terrorism laws, rules, or regulations including, but not limited to the
U.S. Anti-Terrorism Act;
ii. has engaged in conduct which would violate any relevant anti-boycott
law, rule or regulation or any applicable export controls, including but not
limited to the Export Administration Regulations administered and enforced by
the U.S. Department of Commerce or the International Traffic in Arms
Regulations administered and enforced by the U.S. Department of State;
iii. has engaged in conduct which would violate any relevant laws, rules,
or regulations concerning human rights, including but not limited to any law,
rule or regulation concerning false imprisonment, torture or other cruel and
unusual punishment, or child labour; or
iv. is debarred or otherwise rendered ineligible to bid for or to perform
contracts for or with any government, governmental instrumentality or
international organisation or found to have violated any applicable law, rule
or regulation concerning government contracting or public procurement.
PART B
Waiver and invocation of the Conditions
1. To the extent permitted by law and subject to the requirements of the
Panel in accordance with the Code, Bidco reserves the right in its sole
discretion to waive, in whole or in part, all or any of the Conditions in Part
A of this Appendix I, except for Conditions 1 (Long Stop Date), 2(a)i, 2(b)i
and 2(c)i (Scheme approval), and 3 (Rollover and Bonuses Resolution) which
cannot be waived. If any of Conditions 1 (Long Stop Date), 2(a)i, 2(b)i and
2(c)i (Scheme approval) is not satisfied by the relevant deadline specified in
the relevant Condition (or such later date, if any as: (a) Bidco and SiS may
agree; or (b) (in a competitive situation) as may be specified by Bidco with
the consent of the Panel, and in each case that, if so required, the Court may
allow), Bidco shall make an announcement by 8.00 a.m. on the Business Day
following such deadline confirming whether, subject to paragraph 3 below, it
has invoked the relevant Condition, waived the relevant deadline or agreed
with SiS to extend the relevant deadline.
2. Bidco shall be under no obligation to waive (if capable of waiver), to
determine to be or remain satisfied or to treat as satisfied any of Conditions
4 to 10 (inclusive) in Part A of Appendix I above by a date or time earlier
than the latest date and time for the fulfilment of the relevant Condition
notwithstanding that the other Conditions to 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.
3. Subject to paragraph 4 below, under Rule 13.5(a) of the Code, Bidco may
only invoke a Condition 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.
4. Each of Conditions 1 (Long Stop Date), 2(a), 2(b) and 2(c) (Scheme
approval), and 3 (Rollover and Bonuses Resolution) in Part A of Appendix I
above (and any acceptance condition if the Acquisition is implemented by means
of a Takeover Offer) are not subject to Rule 13.5(a) of the Code.
5. Any Condition that is subject to Rule 13.5(a) of the Code may be waived
by Bidco.
6. The Acquisition will not become Effective unless the Conditions have
been fulfilled or (to the extent capable of waiver) waived or, where
appropriate, have been determined by Bidco to be or remain satisfied by no
later than 11.59 p.m. (London Time) on the Long Stop Date.
7. Each of the Conditions shall be regarded as a separate Condition and
shall not be limited by reference to any other Condition.
8. Save as disclosed in this Announcement, other than the documentation
relating to the financing of the Acquisition, there is no agreement or
arrangement to which Bidco is a party which relates to the circumstances in
which it may or may not invoke a Condition.
PART C
Implementation by way of Takeover Offer
Subject to obtaining the consent of the Panel, Bidco reserves the right to
elect to implement the Acquisition by way of a Takeover Offer as an
alternative to the Scheme. In such event, such Takeover Offer will be
implemented on the same terms and conditions, so far as applicable, as those
which would apply to the Scheme subject to appropriate amendments to reflect
the change in method of effecting the Acquisition, including (without
limitation), the inclusion of an acceptance condition set at a level permitted
by the Panel, being in any case more than 50 per cent. of the voting rights
normally exercisable at a general meeting of SiS.
In accordance with normal United Kingdom practice and pursuant to Rule
14e-5(b) of the U.S. Exchange Act, Bidco, its nominees or its brokers (acting
as agents), may from time to time make certain purchases of, or arrangements
to purchase, shares or other securities of SiS outside of the U.S., other than
pursuant to the Acquisition, until the date on which the Acquisition and/or
Scheme becomes effective, lapses or is otherwise withdrawn. These purchases
may occur either in the open market at prevailing prices or in private
transactions at negotiated prices. Any information about such purchases or
arrangements to purchase shall be disclosed as required in the UK, shall be
reported to a Regulatory Information Service and shall be available on the
London Stock Exchange website at www.londonstockexchange.com
(http://www.londonstockexchange.com) .
PART D
Certain further terms of the Acquisition
1. If Bidco is required by the Panel to make a mandatory offer for SiS
Shares under Rule 9 of the Code, Bidco may make such alterations to any of the
above Conditions and terms of the Acquisition as are necessary to comply with
Rule 9 of the Code.
2. 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 any facility of a
national, state or other securities exchange of, any jurisdiction where to do
so would violate the laws of that jurisdiction. Consequently, the availability
of the Acquisition to persons not resident in the UK may be affected by the
laws of the relevant jurisdiction. Persons who are not resident in the UK
should inform themselves about, and observe, any applicable requirements. SiS
Shareholders who are in any doubt about such matters should consult an
appropriate independent professional adviser in the relevant jurisdiction
without delay and observe any applicable requirements. Further details in
relation to Overseas Shareholders will be contained in the Scheme Document.
3. SiS Shares which will be acquired by Bidco pursuant to the Acquisition
will be acquired fully paid and free from all liens, equitable interests,
charges, encumbrances, options, rights of pre-emption and any other
third-party rights or interests whatsoever and together with all rights
existing at the date of this Announcement or thereafter attaching or accruing
to them, including (without limitation) voting rights, the right to receive
and retain, in full, all dividends and other distributions (if any) declared,
made or paid or any other return of capital or value (whether by way of
reduction of share capital or share premium account, repurchase or redemption
or otherwise) made on or after the Effective Date in respect of SiS Shares.
4. If any dividend, other distribution or return of capital is announced,
declared, made, paid or becomes payable in respect of SiS Shares on or after
the date of this Announcement and before the Effective Date, Bidco reserves
the right (without prejudice to the right of Bidco to invoke, with the consent
of the Panel, Condition 7 of Appendix I above) to reduce the consideration
payable in respect of each SiS Share by the amount of all or part of any such
dividend, other distribution or return of capital, in which case any reference
in this Announcement to the consideration payable under the terms of the
Acquisition will be deemed to be a reference to the consideration as so
reduced. If Bidco exercises this right or makes such a reduction in respect of
a dividend, other distribution or return of capital, SiS Shareholders will be
entitled to receive and retain that dividend, other distribution or return of
capital. Bidco also reserves the right to reduce the consideration payable
under the Acquisition in such circumstances as are, and by such amount as is,
permitted by the Panel. Any exercise by Bidco of its rights referred to in
this paragraph 4 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 Acquisition.
5. This Announcement and any rights or liabilities arising hereunder, the
Acquisition, the Scheme and the Forms of Proxy will be governed by the laws of
England and Wales and be subject to the jurisdiction of the courts of England
and Wales. The Acquisition will also be subject to the Conditions and further
terms set out in this Announcement and to be set out in the Scheme Document
and such further terms as may be required to comply with the AIM Rules and the
provisions of the Code. The Acquisition and the Scheme will comply with the
applicable requirements of the FCA, the AIM Rules, the London Stock Exchange
and the Court, as well as with the Panel and the Code. This Announcement does
not constitute, or form part of, an offer or invitation to purchase SiS Shares
or any other securities.
APPENDIX II
SOURCES OF INFORMATION AND BASES OF CALCULATION
In this Announcement, unless otherwise stated or the context otherwise
requires, the following bases and sources have been used.
1. The Fully Diluted Share Capital of SiS is calculated on the basis of:
a. 232,272,606 SiS Shares in issue as at the close of business on the
Latest Practicable Date; plus
b. the issue of 179,798 SiS Shares to satisfy the outstanding option under
the SiS Share Option Plan; plus
c. the issue of 9,538,541 SiS Shares to satisfy entitlements to SiS Shares
under the SiS Subsidiary Put and Call Options.
2. SiS' Adjusted EBITDA of £4.2 million for the year ended 31 December
2024 is calculated on the basis of post-IFRS 16 accounting standards.
3. The Adjusted EBITDA multiple of 23.1 times SiS' Adjusted EBITDA is
calculated on the basis of an enterprise value of £97.8 million. This
enterprise value is calculated based on the implied £82.3 million value of
the entire issued and to be issued share capital of SiS on a fully diluted
basis pursuant to the Cash Offer, and on SiS having £15.6 million of Net Debt
as at 31 December 2024.
4. Unless otherwise stated, all prices and closing prices for SiS Shares
are closing middle market quotations derived from Bloomberg.
5. Volume Weighted Average Prices are derived from Bloomberg and have been
rounded to the nearest single decimal place.
6. Certain figures contained in this Announcement have been subject to
rounding adjustments.
APPENDIX III
IRREVOCABLE UNDERTAKINGS
1. Irrevocable undertakings from the SiS Independent Directors
The following SiS Independent Director, being the only SiS Independent
Director who holds SiS Shares, has given irrevocable undertakings in respect
of his own beneficial holdings of SiS Shares (or those SiS Shares over which
he has control) to vote or to give instructions to procure a vote in favour of
the Resolutions relating to the Acquisition to be proposed at the SiS Meetings
or, in the event that the Acquisition is implemented by way of a Takeover
Offer, to accept or give instructions to procure the acceptance of such
Takeover Offer:
SiS Independent Director Total number of SiS Shares Percentage of SiS Shares in issue on the Latest Practicable Date (%)
Roger Mather 224,437 0.10
The undertakings provided by Roger Mather will cease to be binding if:
· the Scheme Document or, if the Acquisition is implemented by way
of a Takeover Offer, the Offer Document (as applicable), has not been posted
to SiS Shareholders within 28 days of the issue of this Announcement (or
within such longer period as Bidco and SiS, with the consent of the Panel, may
agree);
· in the event that the Acquisition proceeds by way of a Scheme,
any Resolution to be proposed at the Court Meeting and the General Meeting is
not approved by the requisite majority of SiS Shareholders;
· Bidco announces, with the consent of the Panel and before the
Scheme Document or Offer Document (as applicable) is published, that it does
not intend to proceed with the Acquisition;
· the Scheme, or Takeover Offer (as applicable) has not become
Effective, or become or been declared unconditional in all respects (as the
case may be), on or before the Long Stop Date (or such later time or date as
agreed between Bidco and SiS with the approval of the Court and/or the Panel,
if required);
· the Scheme or Offer, as applicable, lapses or is withdrawn in
accordance with its terms;
· any competing offer for the entire issued and to be issued share
capital of SiS becomes or is declared unconditional (if implemented by way of
a takeover offer) or, if proceeding by way of a scheme of arrangement, becomes
effective in accordance with its terms; or
· any event occurs or becomes known to Bidco, bd-capital or
Investec before despatch of the Scheme Document or the Offer Document (as the
case may be) as a result of which the Panel requires or agrees that Bidco need
not proceed with the Acquisition.
This irrevocable undertaking remains binding in the event of a competing offer
for SiS.
2. Undertakings from managers
Pursuant to the terms of the Share Exchange and Equity Terms Deed, the Rolling
Managers, BUW and the DW Shareholding Entities have each given certain
undertakings in respect of their own legal and/or beneficial holdings of SiS
Shares and/or SiS Subsidiary Shares (or those SiS Shares over which they have
control) to, among other things:
(i) exercise put options under the SiS Subsidiary Put and Call
Options;
(ii) vote in favour (or procure a vote in favour) of the
Special Resolution at the General Meeting (and not to vote at the Court
Meeting or on the Rollover and Bonuses Resolution);
(iii) not sell, transfer, charge, encumber, pledge or grant any
option over or otherwise dispose of the Rolling Managers', BUW's or the DW
Shareholding Entities' respective SiS Shares and SiS Subsidiary Shares (as
applicable) other than pursuant to the Share Exchange and Equity Terms Deed;
(iv) not accept and/or not vote in favour of any competing
scheme of arrangement or any other offer or similar transaction in respect of
any of their SiS Shares and SiS Subsidiary Shares which might frustrate the
Acquisition or any part of it;
(v) not enter into any agreement or arrangement to participate
in the capital of any person in connection with or following any transaction
relating to SiS or its assets or any arrangement which would fall under Rule
16.2(c) of the Code; and
(vi) not to vote (or give instructions to vote) on the Rollover
and Bonuses Resolution.
Rolling Managers and Gomrath Total number of SiS Shares in respect of which the undertaking is given as at Percentage of SiS Shares in issue on the Latest Practicable Date (%)
the Latest Practicable Date
Chris Welsh 208,283 0.09
Daniel Lampard 33,333 0.01
Daniel Wright 1,319,141 0.57
Gomrath 6,882,352 2.96
These undertakings remain binding in the event of a
competing offer for SiS.
These undertakings shall lapse and cease to have effect in the event that the
Share Exchange and Equity Terms Deed terminates.
3. Irrevocable undertakings from SiS Shareholders
The following SiS Shareholders have given irrevocable undertakings to vote (or
to procure a vote) in favour of the Resolutions (including the Rollover and
Bonuses Resolution) relating to the Acquisition at the SiS Meetings in respect
of their holdings of SiS Shares or, in the event that the Acquisition is
implemented by way of a Takeover Offer, to accept (or procure the acceptance
of) such Takeover Offer:
SiS Shareholder Total number of SiS Shares Percentage of SiS Shares in issue on the Latest Practicable Date (%)
Otus Capital Management Limited 21,714,598 9.35
Lombard Odier Asset Management (Europe) Limited 64,143,906 27.62
The undertakings provided by the SiS Shareholders referred to above will cease
to be binding if:
· the Scheme Document or, if the Acquisition is implemented by way
of a Takeover Offer, the Offer Document (as applicable), has not been posted
to SiS Shareholders within 28 days of the issue of this Announcement (or
within such longer period as Bidco and SiS, with the consent of the Panel, may
agree);
· in the event that the Acquisition proceeds by way of a Scheme,
any Resolution to be proposed at the Court Meeting and the General Meeting is
not approved by the requisite majority of SiS Shareholders;
· Bidco announces, with the consent of the Panel and before the
Scheme Document or Offer Document (as applicable) is published, that it does
not intend to proceed with the Acquisition;
· the Scheme, or Takeover Offer (as applicable) has not become
Effective, or become or been declared unconditional in all respects (as the
case may be), on or before the Long Stop Date (or such later time or date as
agreed between Bidco and SiS with the approval of the Court and/or the Panel,
if required);
· the Scheme or Offer, as applicable, lapses or is withdrawn in
accordance with its terms;
· any competing offer for the entire issued and to be issued share
capital of SiS becomes or is declared unconditional (if implemented by way of
a takeover offer) or, if proceeding by way of a scheme of arrangement, becomes
effective in accordance with its terms; or
· any event occurs or becomes known to Bidco or Investec before
despatch of the Scheme Document or the Offer Document (as the case may be) as
a result of which the Panel requires or agrees that Bidco need not proceed
with the Acquisition.
These irrevocable undertakings will also cease to be binding in the event that
a person other than Bidco or a subsidiary of Bidco or any person acting in
concert with Bidco announces a firm intention to make an offer (in accordance
with Rule 2.7 of the Code) to acquire the SiS Shares where the value of the
consideration per SiS Share is at least 37.4 pence per SiS Share, being at
least 10 per cent. more than the value for each SiS Share offered by Bidco
pursuant to the terms of the Acquisition, as at the date on which such firm
intention to make an offer is announced.
APPENDIX IV
KEY TERMS OF SECURITIES IN THE BIDCO GROUP
The equity term sheet appended to the Share Exchange and Equity Terms Deed
sets out the key terms of the ordinary shares and preference shares in the
capital of Topco which Rolling Managers and Gomrath will hold following
completion of the Rollover Arrangements.
The Investor, the Rolling Managers and Gomrath will each hold Institutional
Strip. The Rollover Arrangements will result in the Rolling Managers and
Gomrath obtaining Institutional Strip on the same basis and terms as the
Investor and in the same proportion of ordinary shares to preference shares as
the Investor.
The preference shares in the capital of Topco will each accrue interest at a
daily and annually compounding rate of 12 per cent. of their issue price.
The preference shares in the capital of Topco will contractually rank pari
passu in relation to income and capital rights and in priority to the ordinary
shares in the capital of Topco.
The ordinary shares in the capital of Topco that are held by the Investor, the
Rolling Managers and Gomrath will rank pari passu in relation to income and
capital rights.
The ordinary shares in the capital of Topco will be voting shares. The
preference shares in the capital of Topco will be non-voting.
Notwithstanding the pari passu nature of the Institutional Strip, if there is
a refinancing of the Bidco Group within the first 12 months following the
Effective Date, up to £25,000,000 of the Investor's Institutional Strip
(proportionately between each class of security held by the Investor) shall be
repaid first and in priority to any Institutional Strip held by the Rolling
Managers and Gomrath. Any ordinary shares purchased pursuant to such
refinancing shall be bought back at cost.
APPENDIX V
DEFINITIONS
Acquisition the proposed acquisition by Bidco of the entire issued and to be issued share
capital of SiS by means of, together, (i) the Scheme, or should Bidco so elect
(with the consent of the Panel), by means of a Takeover Offer and, where the
context admits, any subsequent revision, variation, extension or renewal
thereof; and (ii) the Share Exchange and Equity Terms Deed
Acquisition Price 34 pence per SiS Share
Adjusted EBITDA earnings before interest, tax, depreciation, amortisation, share-based
payments and foreign exchange variance on intercompany balances, restructuring
costs, transition costs and material one-off payments
Adjusted Net Debt cash, less banking working capital facilities and asset financing and excludes
property leases
AIM the market of that name operated by the London Stock Exchange
AIM Rules the rules for AIM companies published by the London Stock Exchange from time
to time
Announcement this announcement
Authorisations authorisations, agreements, orders, notices, waivers, recognitions, grants,
consents, determinations, clearances, confirmations, concessions,
certificates, exemptions, licences, permissions, permits or approvals
bd-capital bd-capital Partners Limited
Bidco Einstein Bidco Limited, a private limited company incorporated in England and
Wales with company number 16361461
Bidco Directors or Bidco Board the directors of Bidco as at the date of this Announcement or, where the
context so requires, the directors of Bidco from time to time
Bidco Group Topco, Midco, Bidco and their subsidiary undertakings from time to time
Bidco Rollover Notes the 12 per cent. loan notes due 2032 to be issued by Bidco pursuant to a loan
note instrument to be entered into by Bidco on or around the Effective Date
Blocking Law (i) any provision of Council Regulation (EC) No 2271/1996 of 22 November 1996
(or any law or regulation implementing such Regulation in any member state of
the European Union) or the United Kingdom; or (ii) any similar blocking or
anti-boycott law
Business Day a day, not being a public holiday, Saturday or Sunday, on which banks in
London are open for normal business
BUW Bernadette Ude-Wetherell
Cash Bonuses has the meaning given in paragraph 11 of this Announcement
Closing Price the closing middle market price of an SiS Share as derived from the AIM
appendix to the Daily Official List of the London Stock Exchange on any
particular date
Code the City Code on Takeovers and Mergers issued by the Panel, as amended from
time to time
Companies Act the Companies Act 2006, as amended from time to time
Condition(s) the conditions of the Acquisition, as set out in Part A of Appendix I to this
Announcement and to be set out in the Scheme Document
Confidentiality Agreement the confidentiality agreement dated 11 February 2025 between bd-capital and
SiS, as described in paragraph 13 of this Announcement
Court the High Court of Justice of England and Wales
Court Meeting the meeting of SiS Shareholders (or of any class or classes thereof) to be
convened by an order of the Court pursuant to section 896 of the Companies
Act, notice of which will be set out in the Scheme Document, for the purposes
of considering and, if thought fit, approving the Scheme (with or without
amendment) including any adjournment, postponement or reconvening thereof
Court Order the order of the Court sanctioning the Scheme under section 899 of the
Companies Act
Court Sanction has the meaning given in Condition 2(c)i (Scheme approval) in Part A of
Appendix I to this Announcement
CREST 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
Dealing Disclosure an announcement pursuant to Rule 8 of the Code containing details of dealings
in relevant entities of a party to an offer
Disclosed the information which has been disclosed by or on behalf of SiS: (i) in the
virtual data room operated on behalf of SiS for the purposes of the
Acquisition (which Bidco and/or its advisers were able to access prior to the
date of this Announcement); (ii) in the annual report and financial statements
of SiS for the year ending 31 December 2023; (iii) in the interim results of
SiS for the six months to 30 June 2024; (iv) in this Announcement; (v) in any
other announcement made by SiS via a Regulatory Information Service before the
publication of this Announcement; or (vi) as otherwise fairly disclosed to
Bidco, bd-capital, any Investor or any of their respective officers,
employees, agents or advisers (in each case in their capacity as such) before
the date of this Announcement
DTRs the Disclosure Guidance and Transparency Rules made by the FCA under FSMA and
forming part of the FCA's handbook, as amended from time to time
DW Cash Bonus the cash bonus of £580,616 to be paid by SiS to Daniel Wright as described in
paragraph 11 of this Announcement
DW Shareholding Entities the Elidor Trust and Gomrath
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, such
Takeover Offer having been declared or having become unconditional in
accordance with the requirements of the Code
Effective Date the date on which the Acquisition becomes Effective
Elidor Trust the Elidor Trust 2024, a trust connected with Daniel Wright
Enlarged Group the enlarged group following completion of the Acquisition comprising the
Bidco Group and the SiS Group
Enterprise Value the Acquisition Price multiplied by the Fully Diluted Share Capital, plus Net
Debt
Equity Commitment Letter the equity commitment letter dated on or around the date of this Announcement
between the Investor and Bidco
Excluded Shares the SiS Shares to be listed in the Scheme Document as excluded from the
Scheme, including those:
(i) beneficially owned by Bidco or any other member of the
Bidco Group;
(ii) to be transferred to Bidco pursuant to the Share Exchange
and Equity Terms Deed; or
(iii) held by SiS in treasury
FCA the UK Financial Conduct Authority or any successor entity from time to time
Forms of Proxy the forms of proxy for use in connection with the SiS Meetings which shall
accompany the Scheme Document
FSMA the Financial Services and Markets Act 2000, as amended from time to time
Fully Diluted Share Capital 241,990,945 SiS Shares
General Meeting the General Meeting of SiS Shareholders to be convened in connection with the
Acquisition for the purpose of considering and, if thought fit, approving the
Resolutions (with or without amendment), notice of which shall be contained in
the Scheme Document, including any adjournment, postponement or reconvening
thereof
Gomrath Gomrath Limited, a company registered in England and Wales with company number
10623427, a company connected with Daniel Wright
Institutional Strip in respect of: (a) the Investor, means A ordinary shares and A preference
shares in each case in the capital of Topco; and (b) the Rolling Managers and
Gomrath, means B ordinary shares and B preference shares, in each case in the
capital of Topco
Investec Investec Bank plc
Investor bd-capital Fund 2 LP, acting by its general partner, bd-capital GP 2 Limited
Last Accounts Date 31 December 2023
Latest Practicable Date 16 April 2025, being the last practicable date prior to the date of this
Announcement
London Stock Exchange London Stock Exchange plc or any successor
Long Stop Date 6 September 2025 or such later date, if any, as (i) Bidco and SiS may agree;
or (ii) (in a competitive situation) as may be specified by Bidco with the
consent of the Panel, and in each case that, if so required, the Court may
allow
Midco Einstein Midco Limited, a private limited company incorporated in England and
Wales with company number 16361161
Net Debt cash, less banking working capital facilities and asset financing and includes
property leases
Offer Document if (with the consent of the Panel, as applicable) Bidco elects to implement
the Acquisition by way of a Takeover Offer, the document to be sent to SiS
Shareholders which will contain, inter alia, the terms and conditions of the
Takeover Offer
Offer Period the offer period (as defined by the Code) relating to SiS which commenced on
16 April 2025
Opening Position Disclosure an announcement pursuant to Rule 8 of the Code containing details on interests
or short positions in, or rights to subscribe for, any relevant securities of
a party to the Acquisition
Overseas Shareholders Shareholders (or nominees of, or custodians or trustees for, SiS Shareholders)
who are resident in, ordinarily resident in, or nationals or citizens of,
jurisdictions outside of the United Kingdom
Panel the UK Panel on Takeovers and Mergers
Panmure Liberum Panmure Liberum Ltd
PhD PHD Nutrition Limited
Put and Call Option Deed the put and call option deed dated on or around the date of this Announcement
between Topco, Midco, Bidco, the Rolling Managers and Gomrath
Registrar of Companies the Registrar of Companies in England and Wales
Regulatory Information Service or RIS any information service authorised from time to time by the FCA for the
purposes of disseminating regulatory announcements
Relevant Authority any central bank, ministry, governmental, quasi-governmental, supranational
(including the European Union), statutory, regulatory or investigative body,
authority or tribunal (including any national or supranational antitrust,
competition or merger control authority (including the European Commission and
the UK Competition and Markets Authority), any sectoral ministry or regulator
and any foreign investment review body), national, state, municipal or local
government (including any subdivision, court, tribunal, administrative agency
or commission or other authority, any trade agency, association, institution
or professional or environmental body in any jurisdiction)
Relevant Securities shall be construed in accordance with the Code
Resolutions the Rollover and Bonuses Resolution and the Special Resolution
Restricted Jurisdiction(s) any jurisdiction where local laws or regulations may result in a significant
risk of civil, regulatory or criminal exposure if information concerning the
Acquisition is sent or made available to SiS Shareholders in that jurisdiction
or would result in a requirement to comply with any governmental or other
consent or any registration, filing or other formality which Bidco regards as
unduly onerous
Rolling Managers Daniel Wright, Chris Welsh and Daniel Lampard
Rollover and Bonuses Resolution the resolution to be proposed at the General Meeting to approve the Rollover
Arrangements, Cash Bonuses and Trust Payments in accordance with Rule 16.2 of
the Code
Rollover Arrangements the arrangements (excluding the Cash Bonuses and the Trust Payments) described
in paragraph 11 of this Announcement relating to the Rolling Managers and
Gomrath and as documented in the Share Exchange and Equity Terms Deed and the
Put and Call Option Deed
Sanction Hearing the hearing of the Court at which SiS will seek an order sanctioning the
Scheme pursuant to Part 26 of the Companies Act
Scheme the proposed scheme of arrangement under Part 26 of the Companies Act between
SiS and the Scheme Shareholders in connection with the Acquisition, with or
subject to any modification, addition or condition approved or imposed by the
Court and agreed by SiS and Bidco
Scheme Document the document to be sent to SiS Shareholders containing, among other things,
the Scheme, the full terms and conditions of the Scheme, and notices of the
SiS Meetings and Forms of Proxy
Scheme Record Time the time and date to be specified in the Scheme Document, expected to be 6.00
p.m. on the Business Day immediately preceding the Effective Date (or such
other date as Bidco and SiS may agree
Scheme Shareholders holders of Scheme Shares at any relevant date or time
Scheme Shares all SiS Shares:
(i) in issue as at the date of the Scheme Document;
(ii) (if any) issued after the date of the Scheme Document and
before the Scheme Voting Record Time; and/or
(iii) (if any) issued on or after the Scheme 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,
in each case, and where the context requires, which remain in issue at the
Scheme Record Time, but excluding any Excluded Shares
Scheme Voting Record Time the time and date to be specified in the Scheme Document by reference to which
entitlement to vote on the Scheme will be determined
SEC the United States Securities and Exchange Commission
Share Exchange and Equity Terms Deed the share exchange and equity terms deed dated on or around the date of this
Announcement and made between the Investor, Topco, Midco, Bidco, the Rolling
Managers, the DW Shareholding Entities and BUW
Significant Interest in relation to an undertaking, a direct or indirect interest of 20 per cent.
or more of: (i) the total voting rights conferred by the equity share capital
(as defined in section 548 of the Companies Act) of such undertaking; or (ii)
the relevant partnership interest
SiS Science in Sport plc
SiS Articles the articles of association of SiS from time to time
SiS Directors or the SiS Board the directors of SiS as at the date of this Announcement, or, where the
context so requires, the directors of SiS from time to time
SiS Group SiS and its subsidiary undertakings from time to time
SiS Independent Directors Henry Arthur John Turcan, Paul Richardson and Roger Mather
SiS Independent Shareholders the SiS Shareholders other than the Rolling Managers and Gomrath
SiS Meetings the Court Meeting and the General Meeting
SiS Profit Forecast the SiS ordinary course profit forecast, as set out in paragraph 5 of this
Announcement
SiS Remuneration Committee the remuneration committee of the SiS Board
SiS Share Option Plan the SiS 2019 Share Option Plan
SiS Shareholders holders of SiS Shares
SiS Shares the ordinary shares of 10 pence each in the capital of SiS
SiS Subsidiary S I S (Science in Sport) Limited
SiS Subsidiary Manager Shareholders Chris Welsh, Daniel Lampard, BUW and the Elidor Trust
SiS Subsidiary Put and Call Options the put and call options entered into on or around 5 July 2024 as amended on
or around the date of this Announcement between SiS and the SiS Subsidiary
Manager Shareholders
SiS Subsidiary Shares the B ordinary and C ordinary shares (in each case of £0.00001 each) in the
capital of the SiS Subsidiary
Special Resolution the special resolution to be proposed at the General Meeting in connection
with the implementation of the Scheme
Takeover Offer if (with the consent of the Panel), Bidco elects to effect the Acquisition 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 SiS (excluding any Excluded Shares)
on the terms and subject to the conditions to be set out in the related offer
document and, where the context permits, any subsequent revision, variation,
extension or renewal of such takeover offer
Third Party any Relevant Authority or any other body or person whatsoever in any
jurisdiction
Trust Payments has the meaning given in paragraph 11 of this Announcement
Topco Einstein Topco Limited, a private company incorporated in Guernsey with
registration number 75513
UK or United Kingdom the United Kingdom of Great Britain and Northern Ireland
UK MAR Regulation (EU) No. 597/2014 of the European Parliament and the Council of 16
April 2014 on market abuse as it forms part of retained EU law as defined in
the European Union (Withdrawal) Act 2018, as amended from time to time
U.S. or United States the United States of America, its territories and possessions, any state of
the United States and the District of Columbia
U.S. Exchange Act the U.S. Securities Exchange Act of 1934, as amended from time to time, and
the rules and regulations promulgated thereunder
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