REG - TClarke PLC - Placing and Notice of GM

TclarkeAnnouncement

06/07/2023 07:00

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RNS Number : 1171F  TClarke PLC  06 July 2023

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THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION FOR THE PURPOSES OF ARTICLE 7 OF
EU REGULATION 596/2014 (AS AMENDED) (WHICH FORMS PART OF DOMESTIC UK LAW
PURSUANT TO THE EUROPEAN UNION (WITHDRAWAL) ACT 2018 (AS AMENDED)). UPON THE
PUBLICATION OF THIS ANNOUNCEMENT VIA A REGULATORY INFORMATION SERVICE, THIS
INSIDE INFORMATION IS NOW CONSIDERED TO BE IN THE PUBLIC DOMAIN.

 

 

6 July 2023

TClarke plc

 

Oversubscribed Placing to raise £10.7 million

TClarke plc ("TClarke", the "Group" or the "Company"), the Building Services
Group, is pleased to announce that it has conditionally raised gross proceeds
of £10.7 million by way of an oversubscribed placing of new Ordinary Shares
in the Company by Cenkos Securities plc ("Cenkos") to certain institutional
and other investors (the "Placing") in order to fund significant further
expansion beyond 2023.

 

Highlights

 

·      Oversubscribed Placing to raise gross proceeds of £10.7 million
at the Placing Price, subject to TClarke shareholder approval.

 

·      The issue price of 122 pence per Ordinary Share (the "Placing
Price") represents a discount of approximately 14% to the closing mid-market
price per existing TClarke ordinary share of 141.5 pence on 5 July 2023.

 

·      Board remains highly confident that the Group will successfully
deliver its growth strategy such that the Group's revenues will exceed £500m
for the first time in the current financial year, in doing so achieving the
three year revenue growth strategy set out by the Board in March 2021.

 

·      With the Group's forward order book now standing at £781m (2022:
£586m), the net proceeds of the Placing will further strengthen the Group's
balance sheet and will provide additional resources with which to capture and
deliver additional identified short to medium term attractive contract
opportunities in the London business - in doing so driving further growth and
margin expansion.

 

·      The Directors anticipate significant earnings accretion
deployment of the net Placing proceeds into the delivery of anticipated near
term contract wins.

 

·      The Company's largest shareholder, Regent Gas Holdings Ltd, has
subscribed for 4,000,000 Placing Shares at the Placing Price.

 

·      Cenkos is acting as Sole Broker in connection with the Placing.

 

The Placing is conditional, inter alia, upon approval by Shareholders of the
Resolutions and the placing agreement between Cenkos and the Company becoming
unconditional and not being terminated. A circular, which will contain the
notice of a general meeting of the Company to put the necessary Resolutions to
Shareholders (the "General Meeting") is being posted to Shareholders today
(the "Circular") and will also be available on the Company's website
www.tclarke.co.uk (http://www.tclarke.co.uk) . The same definitions apply
throughout this announcement as are applied in the Circular.

 

The General Meeting will be held at 30 St. Mary Axe, London EC3A 8BF on 24
July 2023 at 9.00 a.m.

 

Shareholders must submit their votes by proxy no later than 9.00 a.m. on 20
July 2023.

 

Current Trading, Outlook and Use of Placing Proceeds

 

The Company announced on 10 May 2023 that trading in the early months of 2023
financial had been strong. Trading since that announcement has continued to be
strong and the Board remains highly confident that the Group will
successfully deliver its growth strategy such that the Group's revenues will
exceed £500m for the first time in the current financial year, in doing so
achieving the three year revenue growth strategy set out by the Board in March
2021. The Group is £4.5m net cash positive as at 30 June 2023.

 

TClarke's forward order book has been replenished and so far during 2023 it
has been strengthened significantly. The forward order book now stands at
£781m (2022: £586m). TClarke is well-positioned to manage additional
revenues in our various market sectors, having proactively invested in
resources and capacity to support the Group's growth ambitions.

 

Whilst maintaining the Group's strict and selective approach to tendering, the
Group is experiencing increased visibility in revenues outside of London and
an increasing number of attractive contract opportunities in the London
region. The Board is therefore encouraged by the strength of the Group's
position in the market.

 

The net proceeds of the Placing will further strengthen the Group's balance
sheet and will provide additional resources with which to capture and deliver
identified short to medium term attractive contract opportunities in the
London region - in doing so driving further growth and margin expansion.

 

TClarke will be reporting its half year results for the six months ended 30
June 2023 on 13 July 2023.

 

As a result, the Board considers the Placing to be in the best interests of
the Company and the Group's Shareholders as a whole.

 

Further details on the Placing are set out below.

 

Admission, Settlement, Dealings and Total Voting Rights

 

The Placing Shares will, when issued, be credited as fully paid and rank pari
passu in all respects with each other and with the Existing Ordinary Shares,
including, without limitation, the right to receive all dividends and other
distributions declared, made or paid after the date of issue.

 

Applications have been made to the Financial Conduct Authority (the "FCA") for
admission of the Placing Shares to the premium listing segment of the Official
List maintained by the FCA and to London Stock Exchange plc ("LSE") for
admission of the Placing Shares to trading on LSE's main market for listed
securities ("Admission"). Admission and settlement of the Placing Shares is
expected to take place on or around 8.00 a.m. on 25 July 2023.

 

Following Admission, the Company will have a total of 52,850,780 Ordinary
Shares in issue. There are no Ordinary Shares held in treasury and therefore
the total number of voting rights in the Company is expected to be 52,850,780.
This is the figure that may be used by Shareholders in the Company as the
denominator for the calculations by which they will determine if they are
required to notify their interest in, or change to their interest in, the
share capital of the Company under the Financial Conduct Authority's
Disclosure Guidance and Transparency Rules.

 

For further information, please contact:

 

 TClarke PLC                                                 +44 (0) 20 7997 7400
 Mark Lawrence, Chief Executive Officer                       http://www.tclarke.co.uk (http://www.tclarke.co.uk)

 Trevor Mitchell, Finance Director

 Cenkos Securities plc (Sole Broker)                         +44 (0) 20 7397 8900
 Ben Jeynes / Max Gould / Hamish Waller (Corporate Finance)
 Dale Bellis / Jasper Berry (Sales)

 RMS Partners                                                +44 (0) 20 3735 6551
 Simon Courtenay

 

 

Expected Timetable of Principal Events

 

 Announcement of the Placing                                                 7.00 a.m. on 6 July 2023

 Publication of the Circular                                                 6 July 2023

 Latest time and date for receipt of Forms of Proxy for the General Meeting  9.00 a.m. on 20 July 2023

 General Meeting                                                             9.00 a.m. on 24 July 2023

 Admission and commencement of the dealings in the Placing Shares            8.00 a.m. on 25 July 2023

 Expected date for CREST accounts to be credited in respect of the Placing   As soon as possible after Admission on 25 July 2023
 Shares

 

 

Recommendation and voting intentions

 

The Directors believe the Placing and the passing of the Resolutions to be in
the best interests of the Company and its Shareholders, taken as a whole.
Accordingly, the Directors unanimously recommend that Shareholders vote in
favour of the Resolutions as all of the Directors intend so to do in respect
of their beneficial shareholdings amounting to an aggregate of 1,109,104
Existing Ordinary Shares, representing approximately 2.5% of the Company's
Existing Ordinary Shares.

 

In addition, Regent Gas Holdings Ltd has confirmed to the Company that it
intends to vote in favour of all Resolutions, with the exception of Resolution
1 under which they are not entitled to vote as per the Listing Rules, in
respect of its beneficial interest in 7,366,407 Existing Ordinary Shares,
representing approximately 16.7% of the Company's Existing Ordinary Shares.

 

If either of the Resolutions are not passed at the General meeting, the
Placing will not proceed.

 

Related Party Transactions

 

Regent Gas Holdings Ltd is a related party of the Company for the purposes of
the Listing Rules as it is a substantial shareholder of the Company.

 

Pursuant to, and on the terms of, the Placing, Regent Gas Holdings Ltd has
subscribed for 4,000,000 Placing Shares at the Placing Price, raising gross
proceeds of approximately £4.9 million.

 

The above transaction is a related party transaction requiring shareholder
approval under LR 11.1.7.  Relevant details will be set out in the Circular
to be sent to shareholders in connection with the Placing and shareholder
approval for such participation will be sought at the general meeting of the
Company to be held to approve the issue of the Placing Shares.

Details of the Placing and the Placing Agreement

 

Under the terms of a placing agreement entered into on 6 July 2023, between
Cenkos and the Company (the "Placing Agreement"), Cenkos has conditionally
agreed to use its reasonable endeavours to procure subscribers for the Placing
Shares to raise £10.7 million.

 

Cenkos has conditionally placed the Placing Shares with certain institutional
and other investors at the Placing Price. The Placing is not being
underwritten by Cenkos.

 

The Placing has raised net proceeds of £10.1 million through the Placing of
the Placing Shares at the Placing Price. The Placing Price represents a
discount of approximately 14% to the closing mid-market price per existing
TClarke ordinary share of 141.5 pence on 5 July 2023, being the latest
practicable date prior to the date of this announcement.

 

The Placing Shares will represent approximately 16.6% of the Company's
enlarged issued ordinary share capital on Admission.

 

The Placing is conditional on, inter alia:

 

·      the passing of the Resolutions at the General Meeting;

 

·      the Placing Agreement not having been terminated in accordance
with its terms prior to Admission of the Placing Shares;

 

·      Admission becoming effective by no later than 8.00 a.m. on 25
July 2023 or such later time and/or date as the Company and Cenkos may agree
(being no later than 8.00 a.m. on 7 August 2023).

 

The Placing Agreement contains customary warranties given by the Company to
Cenkos as to matters in relation to, inter alia, the accuracy of information
in this Announcement and other matters relating to the Company and its
business. In addition, the Company has provided a customary indemnity to
Cenkos in respect of liabilities arising out of or in connection with the
Placing.

 

Cenkos is entitled to terminate the Placing Agreement in certain circumstances
prior to Admission including where any of the warranties are found not to be
true or are materially inaccurate or are misleading in any respect, the
failure of the Company to comply in any material respect with any of its
obligations under the Placing Agreement, the occurrence of certain force
majeure events or a material adverse change in the business of the Group or in
financial or trading position or prospects of the Group or the Company.

 

 

General Meeting

 

The Board is seeking the approval of Shareholders at the General Meeting to
allot the Placing Shares. The Placing is conditional, inter alia, on the
passing of the Resolutions by Shareholders at the General Meeting.

 

 

 

Important Notices

 

The distribution of this Announcement and any other documentation associated
with the Placing into jurisdictions other than the United Kingdom may be
restricted by law.  Persons into whose possession these documents come should
inform themselves about and observe any such restrictions.  Any failure to
comply with these restrictions may constitute a violation of the securities
laws or regulations of any such jurisdiction.  In particular, such documents
should not be distributed, forwarded to or transmitted, directly or
indirectly, in whole or in part, in, into or from the United States,
Australia, Canada, Japan or the Republic of South Africa or any other
jurisdiction where to do so may constitute a violation of the securities laws
or regulations of any such jurisdiction (each a "Restricted Jurisdiction").

 

This Announcement is not an offer of securities for sale into the United
States.  The Placing Shares have not been and will not be registered under
the US Securities Act 1933 as amended (the "US Securities Act") or with any
securities regulatory authority of any state or other jurisdiction of the
United States and, accordingly, may not be offered, sold, resold, taken up,
transferred, delivered or distributed, directly or indirectly, within the
United States except pursuant to an applicable exemption from, or in a
transaction not subject to, the registration requirements of the US Securities
Act and in compliance with any applicable securities laws of any state or
other jurisdiction of the United States. There will be no public offer of the
Placing Shares in the United States.

 

The Placing Shares are being offered and sold only in "offshore transactions"
outside the US in reliance on, and in accordance with, Regulation S under the
US Securities Act.  The Placing Shares have not been approved or disapproved
by the US Securities and Exchange Commission, any state securities commission
in the US or any other US regulatory authority, nor have any of the foregoing
authorities passed upon or endorsed the merits of the offering of the Placing
Shares or the accuracy or adequacy of this Announcement.  Any representation
to the contrary is a criminal offence in the US. In addition, offers, sales or
transfers of the securities in or into the US for a period of time following
completion of the Placing by a person (whether or not participating in the
Placing) may violate the registration requirement of the Securities Act.

 

The Placing Shares have not been and will not be registered under the relevant
laws of any state, province or territory of any Restricted Jurisdiction and
may not be offered, sold, resold, taken up, transferred, delivered or
distributed, directly or indirectly, within any Restricted Jurisdiction except
pursuant to an applicable exemption from registration requirements.  There
will be no public offer of Placing Shares.

 

This Announcement is for information purposes only and does not constitute or
form part of any offer to issue or sell, or the solicitation of an offer to
acquire, purchase or subscribe for, any securities in any jurisdiction and
should not be relied upon in connection with any decision to subscribe for or
acquire any of the Placing Shares (as the case may be).  In particular, this
Announcement does not constitute or form part of any offer to issue or sell,
or the solicitation of an offer to acquire, purchase or subscribe for, any
securities in the United States.

 

This Announcement has been issued by, and is the sole responsibility of, the
Company.  No person has been authorised to give any information or to make
any representations other than those contained in this Announcement and, if
given or made, such information or representations must not be relied on as
having been authorised by the Company or Cenkos.  Subject to the Listing
Rules of the FCA, the issue of this Announcement shall not, in any
circumstances, create any implication that there has been no change in the
affairs of the Company since the date of this Announcement or that the
information contained in it is correct at any subsequent date.

 

Cenkos, which is authorised and regulated in the United Kingdom by the
Financial Conduct Authority, is acting exclusively for the Company and no one
else in connection with the Placing and will not regard any other person
(whether or not a recipient of this Announcement) as a client in relation to
the Placing and will not be responsible to anyone other than the Company for
providing the protections afforded to its clients or for providing advice in
relation to the Placing or any matters referred to in this Announcement.

 

Apart from the responsibilities and liabilities, if any, which may be imposed
on Cenkos by the Financial Services and Markets Act 2000 or the regulatory
regime established thereunder, Cenkos does not accept any responsibility
whatsoever for the contents of this Announcement, and makes no representation
or warranty, express or implied, for the contents of this Announcement,
including its accuracy, completeness or verification, or for any other
statement made or purported to be made by it, or on its behalf, in connection
with the Company or the Placing Shares or the Placing, and nothing in this
Announcement is or shall be relied upon as, a promise or representation in
this respect whether as to the past or future.  Cenkos accordingly disclaims
to the fullest extent permitted by law all and any liability whether arising
in tort, contract or otherwise (save as referred to above) which it might
otherwise have in respect of this Announcement or any such statement.

 

No statement in this Announcement is intended to be a profit forecast or
profit estimate for any period and no statement in this Announcement should be
interpreted to mean that earnings or earnings per share of the Company for the
current or future financial years would necessarily match or exceed the
historical published earnings or earnings per share of the Company.

 

This Announcement may include statements that are, or may be deemed to be,
"forward-looking statements".  These forward-looking statements can be
identified by the use of forward-looking terminology, including the terms
"believes", "estimates", "plans", "projects", "anticipates", "expects",
"intends", "may", "will", or "should" or, in each case, their negative or
other variations or comparable terminology.  These forward-looking statements
include matters that are not historical facts.  They appear in a number of
places throughout this Announcement and include statements regarding the
Directors' current intentions, beliefs or expectations concerning, among other
things, the Company's results of operations, financial condition, liquidity,
prospects, growth, strategies and the Company's markets.  By their nature,
forward-looking statements involve risk and uncertainty because they relate to
future events and circumstances.  Actual results and developments could
differ materially from those expressed or implied by the forward-looking
statements.  Forward-looking statements may and often do differ materially
from actual results.  Any forward-looking statements in this Announcement are
based on certain factors and assumptions, including the Directors' current
view with respect to future events and are subject to risks relating to future
events and other risks, uncertainties and assumptions relating to the
Company's operations, results of operations, growth strategy and liquidity.
Whilst the Directors consider these assumptions to be reasonable based upon
information currently available, they may prove to be incorrect.  Save as
required by applicable law or regulation, the Company undertakes no obligation
to release publicly the results of any revisions to any forward-looking
statements in this Announcement that may occur due to any change in the
Directors' expectations or to reflect events or circumstances after the date
of this Announcement.

 

Information to Distributors

 

UK product governance

 

Solely for the purposes of the product governance requirements contained
within of Chapter 3 of the FCA Handbook Production Intervention and Product
Governance Sourcebook (the "UK Product Governance Requirements"), and
disclaiming all and any liability, whether arising in tort, contract or
otherwise, which any "manufacturer" (for the purposes of the UK Product
Governance Requirements) may otherwise have with respect thereto, the Placing
Shares have been subject to a product approval process, which has determined
that such securities are: (i) compatible with an end target market of
investors who meet the criteria of retail investors and investors who meet the
criteria of professional clients and eligible counterparties, each as defined
in paragraph 3 of the FCA Handbook Conduct of Business Sourcebook; and (ii)
eligible for distribution through all distribution channels (the "Target
Market Assessment"). Notwithstanding the Target Market Assessment,
distributors (for the purposes of UK Product Governance Requirements) should
note that: (a) the price of the Placing Shares may decline and investors could
lose all or part of their investment; (b) the Placing Shares offer no
guaranteed income and no capital protection; and (c) an investment in the
Placing Shares is compatible only with investors who do not need a guaranteed
income or capital protection, who (either alone or in conjunction with an
appropriate financial or other adviser) are capable of evaluating the merits
and risks of such an investment and who have sufficient resources to be able
to bear any losses that may result therefrom.  The Target Market Assessment
is without prejudice to the requirements of any contractual, legal or
regulatory selling restrictions in relation to the Placing.  Furthermore, it
is noted that, notwithstanding the Target Market Assessment, Cenkos will only
procure investors who meet the criteria of professional clients and eligible
counterparties.

 

For the avoidance of doubt, the Target Market Assessment does not constitute:
(a) an assessment of suitability or appropriateness for the purposes of
Chapter 9A or 10A respectively of the FCA Handbook Conduct of Business
Sourcebook; or (b) a recommendation to any investor or group of investors to
invest in, or purchase, or take any other action whatsoever with respect to
the Placing Shares.

 

Each distributor is responsible for undertaking its own target market
assessment in respect of the Placing Shares and determining appropriate
distribution channels.

 

Neither the content of the Company's website nor any website accessible by
hyperlinks to the Company's website is incorporated in, or forms part of, this
Announcement.

 

Certain figures contained in this Announcement, including financial
information, have been subject to rounding adjustments. Accordingly, in
certain instances, the sum or percentage change of the numbers contained in
this Announcement may not conform exactly with the total figure given.

 

All references to time in this Announcement are to London time, unless
otherwise stated.

 

The Circular and the Notice of General Meeting have been submitted to the
Financial Conduct Authority and will shortly be available for inspection via
the National Storage Mechanism at
https://data.fca.org.uk/#/nsm/nationalstoragemechanism  and will be sent to
those shareholders who have elected to receive paper communications.

 

The Circular and the Notice of General Meeting will also be available to view
on the Company's website at www.tclarke.co.uk (http://www.tclarke.co.uk) .

 

The person responsible for arranging the release of this announcement on
behalf of the Company is Trevor Mitchell, Finance Director

 

 

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