REG - Water Intelligence - Results of Placing and Exercise of Options

Water IntelligenceAnnouncement

12/11/2021 17:45

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RNS Number : 2978S  Water Intelligence PLC  12 November 2021

THIS ANNOUNCEMENT (INCLUDING THE APPENDIX) AND THE INFORMATION CONTAINED
HEREIN IS RESTRICTED AND FOR INFORMATION PURPOSES ONLY AND IS NOT FOR RELEASE,
PUBLICATION OR DISTRIBUTION, IN WHOLE OR IN PART, DIRECTLY OR INDIRECTLY, AND
DOES NOT CONSTITUTE AN OFFER OF SECURITIES FOR SALE IN, INTO OR FROM THE
UNITED STATES, AUSTRALIA, CANADA, JAPAN, THE REPUBLIC OF SOUTH AFRICA OR ANY
OTHER JURISDICTION IN WHICH SUCH RELEASE, PUBLICATION, DISTRIBUTION, OFFER OR
SALE WOULD BE UNLAWFUL. PLEASE SEE THE IMPORTANT NOTICES SECTION OF THIS
ANNOUNCEMENT.

THE INFORMATION CONTAINED WITHIN THIS ANNOUNCEMENT IS DEEMED BY THE COMPANY TO
CONSTITUTE INSIDE INFORMATION AS STIPULATED UNDER THE MARKET ABUSE REGULATION
(REGULATION 596/2014/EU) AS IT FORMS PART OF UK DOMESTIC LAW BY VIRTUE OF THE
EUROPEAN UNION (WITHDRAWAL) ACT 2018 ("MAR").

12 November 2021

 

Water Intelligence plc

 

("Water Intelligence" or the "Company" or the "Group")

 

Results of Placing

 

Exercise of Options

 

Water Intelligence, a leading multinational provider of non-invasive leak
detection and remediation services for both potable and non-potable water,
announces the successful completion of its placing announced earlier today
(the "Placing") which has closed significantly oversubscribed.

The transaction comprised both the placing of 1,016,667 New Ordinary Shares to
raise approximately £12.2 million and the placing of 25,000 New Ordinary
Shares through the exercise of options to raise £0.3 million.

A total of 1,041,667 new ordinary shares (the "New Ordinary Shares") were
placed at a price of 1,200 pence per share (the "Placing Price"), raising
gross proceeds of £12.5 million, in excess of the target size of at least
£10 million. The Placing received strong demand from existing institutional
shareholders as well as new long only institutional investors. The Placing was
conducted by way of an accelerated bookbuild process. RBC Europe Limited
(trading as "RBC Capital Markets") is acting as lead bookrunner whilst Dowgate
Capital Limited ("Dowgate") and WH Ireland Limited ("WH Ireland") are acting
as joint bookrunners in connection with the Placing (collectively the "Joint
Bookrunners").

As outlined in the launch announcement for the Placing, proceeds will
primarily be used for the continued re-acquisition of American Leak Detection
("ALD") franchises (the "Franchise Buy-Backs"). The transaction will help the
Company to accelerate its growth strategy of building a "One-Stop-Shop" water
infrastructure platform. The Company may also use a portion of the proceeds
for bolt-on acquisitions and to finance additional training centres.

·    Franchise Buy-Backs: The Company has identified four near-term
franchise targets representing revenues of over $10 million in aggregate. The
Franchise Buy-Backs are expected to be EPS accretive. The four franchise
targets identified will enlarge ALD's regional hubs creating scale,
operational efficiencies and broadening the Company's offerings in the United
States in the Northwest, Southern California, the Midwest and the South.
Strengthening the Company's regional hubs enables it to leverage corporate
marketing and management to assist with franchise growth.

·      Bolt-on acquisitions: A pipeline of potential near-term bolt-on
acquisition opportunities has also been identified by the Company which will
enable it to add capability to its water value chain.

·      Training centres: The Company may also use the proceeds of the
capital raising to finance additional training centres to add technicians and
trucks for scalable organic growth from each location given Salesforce
implementation.

 

Dr. Patrick DeSouza, Executive Chairman of Water Intelligence, commented:

"We are pleased to announce the successful close of our oversubscribed capital
raise which received significant demand from existing and new investors. We
appreciate the continued support of our existing investors and are pleased to
welcome new high quality institutional investors to our shareholder register.
 The proceeds will help us accelerate our ambitious growth strategy of
building a leading multinational water infrastructure platform. Global market
demand for water and wastewater infrastructure solutions is only growing and
impacted by the realities of climate change. We look forward to taking a
leadership role in providing solutions globally."

 

Exercise of Share Options

 

The Company has also received notice that a franchisee has exercised options
over 25,000 new ordinary shares of 1 pence each ("Option Shares"). The Option
Shares are also expected to be admitted to trading at 8.00 a.m. on or around
17 November 2021. The Option Shares will be sold alongside the Placing Shares.

 

The New Ordinary Shares and Option Shares, when issued, will be fully paid and
will rank pari passu in all respects with the existing ordinary shares,
including the right to receive all dividends and other distributions declared,
made or paid after the date of issue.

 

Admission and Total Voting Rights

 

Application has been made to the London Stock Exchange for the Placing Shares
and Option Shares (as defined below) to be admitted to trading on AIM and it
is expected that admission will become effective and that trading will
commence in the Placing Shares and Option Shares at 8.00 a.m. on or around 17
November 2021 ("Admission"). The Placing is conditional on, among other
things, Admission becoming effective and the placing agreement between the
Company and the Joint Bookrunners being entered into and not being terminated
in accordance with its terms.

 

Upon Admission, the issued share capital of the Company will be 19,447,688
shares, divided into 17,367,688 ordinary shares of 1 pence each (of which
36,500 ordinary shares will be held by the Company in treasury) admitted to
trading on AIM and which entitle the holder to 1 vote per ordinary share; and
2,080,000 nil paid B ordinary shares of 1 pence each which are not admitted to
trading on AIM but which otherwise rank pari passu with the ordinary shares
(save that they may not participate in any distribution or return of capital
until they are fully paid).

 

Accordingly, the Company's total voting rights following Admission will be
19,411,188 shares. This total voting rights number may be used by shareholders
at Admission as the denominator for the calculations by which they will
determine if they are required to notify their interest in, or a change to
their interest in the Company under the FCA's Disclosure Guidance and
Transparency Rules.

 

 

Enquiries

 

 Water Intelligence plc
 Patrick DeSouza, Executive Chairman                            Tel: +1 203 654 5426

 RBC Capital Markets - Lead Bookrunner and Joint Broker
 Jill Li                                                        Tel: +44 (0) 207 653 4000
 Elizabeth Evans
 Max Avison

 Dowgate Capital Limited - Joint Bookrunner and Joint Broker    Tel: +44 (0) 203 903 7715
 Stephen Norcross

 Russell Cook

 Nicholas Chambers

 WH Ireland Limited - Joint Bookrunner, NOMAD and Joint Broker  Tel: +44 (0) 207 220 1666
 Adrian Hadden

 

Notes to Editors

 

About Water Intelligence

 

Water Intelligence plc (AIM: WATR.L) is a leading multinational provider of
precision, minimally-invasive leak detection and remediation solutions for
both potable and non-potable water.

 

 

 

 

IMPORTANT NOTICES

 

MEMBERS OF THE PUBLIC ARE NOT ELIGIBLE TO TAKE PART IN THE PLACING. THIS
ANNOUNCEMENT (INCLUDING THE APPENDIX) AND THE TERMS AND CONDITIONS SET OUT
HEREIN ARE FOR INFORMATION PURPOSES ONLY AND ARE DIRECTED ONLY AT PERSONS
WHOSE ORDINARY ACTIVITIES INVOLVE THEM IN ACQUIRING, HOLDING, MANAGING AND
DISPOSING OF INVESTMENTS (AS PRINCIPAL OR AGENT) FOR THE PURPOSES OF THEIR
BUSINESS AND WHO HAVE PROFESSIONAL EXPERIENCE IN MATTERS RELATING TO
INVESTMENTS AND ARE: (1) IF IN A MEMBER STATE OF THE EUROPEAN ECONOMIC AREA
("EEA"), QUALIFIED INVESTORS AS DEFINED IN ARTICLE 2(E) OF REGULATION (EU)
2017/1129 (THE " PROSPECTUS REGULATION"); (2) IF IN THE UNITED KINGDOM,
QUALIFIED INVESTORS AS DEFINED IN ARTICLE 2(E) OF THE PROSPECTUS REGULATION AS
IT FORMS PART OF UK DOMESTIC LAW BY VIRTUE OF THE EUROPEAN UNION (WITHDRAWAL)
ACT 2018, AS AMENDED (THE "UK PROSPECTUS REGULATION"), WHO (A) FALL WITHIN
ARTICLE 19(5) OF THE FINANCIAL SERVICES AND MARKETS ACT 2000 (FINANCIAL
PROMOTION) ORDER 2005, AS AMENDED (THE "ORDER") (INVESTMENT PROFESSIONALS) OR
(B) FALL WITHIN ARTICLE 49(2)(a) TO (d) (HIGH NET WORTH COMPANIES,
UNINCORPORATED ASSOCIATIONS, ETC.) OF THE ORDER; (3) PERSONS TO WHOM THE
ANNOUNCEMENT MAY OTHERWISE BE LAWFULLY COMMUNICATED (ALL SUCH PERSONS TOGETHER
BEING REFERRED TO AS "RELEVANT PERSONS").

THIS ANNOUNCEMENT AND THE INFORMATION IN IT MUST NOT BE ACTED ON OR RELIED ON
BY PERSONS WHO ARE NOT RELEVANT PERSONS. PERSONS DISTRIBUTING THIS
ANNOUNCEMENT MUST SATISFY THEMSELVES THAT IT IS LAWFUL TO DO SO. ANY
INVESTMENT OR INVESTMENT ACTIVITY TO WHICH THIS ANNOUNCEMENT RELATES IS
AVAILABLE ONLY TO RELEVANT PERSONS AND WILL BE ENGAGED IN ONLY WITH RELEVANT
PERSONS. THIS ANNOUNCEMENT DOES NOT ITSELF CONSTITUTE AN OFFER FOR SALE OR
SUBSCRIPTION OF ANY SECURITIES IN WATER INTELLIGENCE PLC.

THE PLACING SHARES HAVE NOT BEEN AND WILL NOT BE REGISTERED UNDER THE UNITED
STATES SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT") OR WITH ANY
SECURITIES REGULATORY AUTHORITY OF ANY STATE OR JURISDICTION OF THE UNITED
STATES, AND MAY NOT BE OFFERED, SOLD OR TRANSFERRED, DIRECTLY OR INDIRECTLY,
IN THE UNITED STATES EXCEPT PURSUANT TO AN EXEMPTION FROM, OR IN A TRANSACTION
NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND IN
COMPLIANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY STATE OR OTHER
JURISDICTION OF THE UNITED STATES. THE PLACING SHARES ARE BEING OFFERED AND
SOLD ONLY OUTSIDE OF THE UNITED STATES ONLY IN "OFFSHORE TRANSACTIONS" WITHIN
THE MEANING OF, AND IN ACCORDANCE WITH, REGULATION S UNDER THE SECURITIES ACT
("REGULATION S") AND OTHERWISE IN ACCORDANCE WITH APPLICABLE LAWS. NO PUBLIC
OFFERING OF THE PLACING SHARES IS BEING MADE IN THE UNITED STATES OR
ELSEWHERE.

THIS ANNOUNCEMENT HAS BEEN ISSUED BY AND IS THE SOLE RESPONSIBILITY OF THE
COMPANY. THIS ANNOUNCEMENT (INCLUDING THE APPENDIX) AND THE INFORMATION
CONTAINED HEREIN IS RESTRICTED AND IS NOT FOR RELEASE, PUBLICATION OR
DISTRIBUTION, IN WHOLE OR IN PART, DIRECTLY OR INDIRECTLY, IN OR INTO OR FROM
THE UNITED STATES, AUSTRALIA, CANADA, JAPAN, THE REPUBLIC OF SOUTH AFRICA OR
ANY OTHER JURISDICTION IN WHICH SUCH RELEASE, PUBLICATION OR DISTRIBUTION
WOULD BE UNLAWFUL.

The distribution of this Announcement and/or the Placing and/or issue of the
Placing Shares in certain jurisdictions may be restricted by law. No action
has been taken by the Company, the Joint Bookrunners or any of their
respective affiliates, agents, directors, officers or employees that would
permit an offer of the Placing Shares or possession or distribution of this
Announcement or any other offering or publicity material relating to such
Placing Shares in any jurisdiction where action for that purpose is required.
Persons into whose possession this Announcement comes are required by the
Company and the Joint Bookrunners to inform themselves about and to observe
any such restrictions.

Neither this Announcement nor any part of it constitutes 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 (including its
territories and possessions, any state of the United States and the District
of Columbia (the "United States" or the "U.S.")), Australia, Canada, Japan or
the Republic of South Africa or any other jurisdiction in which the same would
be unlawful. No public offering of the Placing Shares is being made in any
such jurisdiction.

All offers of the Placing Shares will be made pursuant to exemptions under the
Prospectus Regulation or the UK Prospectus Regulation from the requirement to
produce a prospectus. In the United Kingdom, this Announcement is being
directed solely at persons in circumstances in which section 21(1) of the
Financial Services and Markets Act 2000 (as amended) does not require the
approval of the relevant communication by an authorised person.

The Placing Shares have not been approved or disapproved by the U.S.
Securities and Exchange Commission (the "SEC"), any state securities
commission or other regulatory authority in the United States, nor have any of
the foregoing authorities passed upon or endorsed the merits of the Placing or
the accuracy or adequacy of this Announcement. Any representation to the
contrary is a criminal offence in the United States. The relevant clearances
have not been, nor will they be, obtained from the securities commission of
any province or territory of Canada, no prospectus has been lodged with, or
registered by, the Australian Securities and Investments Commission or the
Japanese Ministry of Finance; the relevant clearances have not been, and will
not be, obtained for the South Africa Reserve Bank or any
other applicable body in the Republic of South Africa in relation to the
Placing Shares and the Placing Shares have not been, nor will they be,
registered under or offered in compliance with the securities laws of any
state, province or territory of Australia, Canada, Japan or the Republic of
South Africa. Accordingly, the Placing Shares may not (unless an exemption
under the relevant securities laws is applicable) be offered, sold, resold or
delivered, directly or indirectly, in or into Australia, Canada, Japan or the
Republic of South Africa or any other jurisdiction outside the United Kingdom.

Persons (including, without limitation, nominees and trustees) who have a
contractual right or other legal obligations to forward a copy of this
Announcement should seek appropriate advice before taking any action.

By participating in the Placing, each person who is invited to and who chooses
to participate in the Placing (a "Placee") by making an oral and legally
binding offer to acquire Placing Shares will be deemed to have read and
understood this Announcement in its entirety, to be participating, making an
offer and acquiring Placing Shares on the terms and conditions contained
herein and to be providing the representations, warranties, indemnities,
acknowledgements and undertakings contained in the Appendix.

This Announcement may contain, and the Company may make, verbal statements
containing "forward-looking statements" with respect to certain of the
Company's plans and its current goals and expectations relating to its future
financial condition, performance, strategic initiatives, objectives and
results. Forward-looking statements sometimes use words such as "aim",
"anticipate", "target", "expect", "estimate", "intend", "plan", "goal",
"believe", "seek", "may", "could", "outlook" or other words of similar
meaning. By their nature, all forward-looking statements involve risk and
uncertainty because they relate to future
events and circumstances which are beyond the control of the Company,
including amongst other things, United Kingdom domestic and global economic
business conditions, market-related risks such as fluctuations in interest
rates and exchange rates, the policies and actions of governmental and
regulatory authorities, the effect of competition, inflation, deflation, the
timing effect and other uncertainties of future acquisitions or
combinations within relevant industries, the effect of tax and other
legislation and other regulations in the jurisdictions in which the Company
and its respective affiliates operate, the effect of volatility in the
equity, capital and credit markets on the Company's profitability and ability
to access capital and credit, a decline in the Company's credit ratings; the
effect of operational risks; and the loss of key personnel. As a result, the
actual future financial condition, performance and results of the Company may
differ materially from the plans, goals and expectations set forth in any
forward-looking statements. Forward-looking statements contained in this
Announcement regarding past trends or activities should not be taken as a
representation that such trends or activities will continue in the future.
Undue reliance should not be placed on forward-looking statements made in this
Announcement by or on behalf of the Company speak only as of the date they are
made. Except as required by applicable law or regulation, the Company
expressly disclaims any obligation or undertaking to publish any updates or
revisions to any forward-looking statements contained in this Announcement to
reflect any changes in the Company's expectations with regard thereto or any
changes in events, conditions or circumstances on which any such statement is
based.

Each of RBC Capital Markets, WH Ireland and Dowgate are authorised and
regulated by the Financial Conduct Authority (the "FCA") in the United Kingdom
and are acting exclusively for the Company and no one else in connection with
the Placing, and RBC Capital Markets, WH Ireland and Dowgate will not be
responsible to anyone (including any Placees) other than the Company for
providing the protections afforded to their clients or for providing
advice in relation to the Placing or any other matters referred to in this
Announcement. Each Placee should consult with its own advisers as to the
legal, tax, business and other features and consequences of an investment in
Placing Shares.

No representation or warranty, express or implied, is or will be made as
to, or in relation to, and no responsibility or liability is or will be
accepted by the Joint Bookrunners or by any of their respective affiliates or
agents as to, or in relation to, the accuracy or completeness of this
Announcement or any other written or oral information made available to or
publicly available to any interested party or its advisers, and any liability
therefor is expressly disclaimed.

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

The price of shares and any income expected or received from them may go down
as well as up and investors may not get back the full amount invested upon
disposal of the shares. Past performance is no guide to future performance,
and persons needing advice should consult an independent financial adviser.

The Placing Shares to be issued pursuant to the Placing will not be admitted
to trading on any stock exchange other than the AIM market of the London Stock
Exchange.

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

Information to Distributors

UK product governance

Solely for the purposes of Paragraph 3.2.7R regarding the responsibilities of
UK Manufacturers under the product governance requirements contained within
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, investors who meet the criteria of professional clients and
eligible counterparties, each as defined in the UK Product Governance
Requirements; and (ii) eligible for distribution through all distribution
channels as are permitted by UK Product Governance Requirements (the "UK
Target Market Assessment"). Notwithstanding the UK 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 UK 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 UK Target Market Assessment, the Joint
Bookrunners will only procure investors who meet the criteria of professional
clients and eligible counterparties.

For the avoidance of doubt, the UK 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.

EEA product governance

Solely for the purposes of the product governance requirements contained
within: (a) EU Directive 2014/65/EU on markets in financial instruments, as
amended ("MiFID II"); (b) Articles 9 and 10 of Commission Delegated Directive
(EU) 2017/593 supplementing MiFID II; and (c) local implementing measures in
the European Economic Area (together, the "MiFID II Product Governance
Requirements"), and disclaiming all and any liability, whether arising in
tort, contract or otherwise, which any "manufacturer" (for the purposes of the
MiFID II Product Governance Requirements) may otherwise have with respect
thereto, the Placing Shares have been subject to a product approval process,
which has determined that the Placing Shares are: (i) compatible with an end
target market of (a) retail investors, (b) investors who meet the criteria of
professional clients and (c) eligible counterparties, each as defined in the
MiFID II Product Governance Requirements; and (ii) eligible for distribution
through all distribution channels as are permitted by MiFID II (the "EEA
Target Market Assessment"). Notwithstanding the EEA Target Market Assessment,
distributors should note that: the price of the Placing Shares may decline and
investors could lose all or part of their investment; the Placing Shares offer
no guaranteed income and no capital protection; and 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 EEA 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 EEA Target Market Assessment, the Joint
Bookrunners will only procure investors who meet the criteria of professional
clients and eligible counterparties.

For the avoidance of doubt, the EEA Target Market Assessment does not
constitute: (a) an assessment of suitability or appropriateness for the
purposes of MiFID II; 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 determining appropriate
distribution channels.

 

 

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