TIDM69ZM
RNS Number : 4549I
Intu Debenture PLC
14 April 2022
Intu Debenture PLC
Business Plan, Q4 Update and Defaults
INTU DEBENTURE PLC
LEI: 213800UX3TM5RGB1UF29
GBP354,876,000 5.562 per cent. First Mortgage Debenture Stock
2027
INTU DEBENTURE PLC (THE "COMPANY") ANNOUNCES PUBLICATION OF
UPDATED BUSINESS PLAN, Q4 UPDATE AND CERTAIN DEFAULTS
14 April 2022
Business Plan and Q4 Update
The Company announces the publication of a report reflecting (1)
an operation and market update in respect of trading numbers in the
financial quarter ending on 31 December 2021 (the "Q4 Update") and
(2) a revised business plan (the "FY22 - FY24 Business Plan"),
which reflects an update to the business plan originally presented
to the Stockholders in December 2020 (the "Original Business
Plan"), each of which is available on the Company's website at
https://debentureplc.com/quarterlyreports/.
The Q4 Update and the FY22 - FY24 Business Plan, prepared by the
Company and the Company's asset and finance managers, APAM Limited
("APAM"), include, as relevant and amongst other things, actual
trading results to 31 December 2021, financial forecasts for FY22 -
FY24, a revised outlook for rental income and net operating income,
an overview of the plan to prioritise and utilise excess cash flow
within the structure to enhance underlying value and background
relating to the updated property values referred to in the
Company's announcement of 18 March 2022 (the "Valuation RNS"),
available on the Company's website at
https://debentureplc.com/rns/.
The FY22 - FY24 Business Plan reflects an extensive review
process in order to update the Original Business Plan and reflects
input from an ad hoc group of Stockholders who agreed to become
restricted in order to review a draft of the FY22 - FY24 Business
Plan and attend a presentation of the plan by the Company and APAM.
The Q4 Update similarly provides an update with respect to key
information in respect of business operations and market conditions
as against the last quarterly update made by the Company in
November 2021.
The Company notes that although the FY22 - FY24 Business Plan
and the Q4 Update reflect actual numbers, where available, all
projections, including for the period as set out in the FY22 - FY24
Business Plan and any period set out in the Q4 Update should
continue to be taken as directional only.
As per the Valuation RNS, the Company anticipates that as the
FY22 - FY24 Business Plan has been finalised, that the Notice of
Meeting at which Stockholders will be asked to consider and, if
thought fit, approve an Extraordinary Resolution regarding both the
proposed amendment and restructuring transaction (the "Proposed
Restructuring") will be issued in the coming weeks, and in any
event, before the end of Q2 2022. The Company can confirm that
holders of a significant majority of the outstanding principal
amount of the Stock have indicated that they are supportive of the
Proposed Restructuring and that the Company is not aware of any
material issue or concern that will further delay the Notice of
Meeting at which Stockholders will be asked to approve, by way of
Extraordinary Resolution, the Proposed Restructuring, save for
administrative technicalities in updating and finalising all
necessary documentation.
The Company will schedule a one-hour call with Stockholders on
which directors of the Company and individuals from APAM will
present a brief overview of, amongst other things, the Q4 Update
and the FY22 - FY24 Business Plan. An RNS will be published on the
Company website announcing the time and date for this update call
and the process by which interested Stockholders can provide
confirmation of their proposed attendance.
Events of Default
As anticipated in the Company's announcement dated 28 January
2022 (available on the Company's website at
https://debentureplc.com/rns/) (the "Accounts RNS"), the Company
has failed to file the annual accounts for the year ending 31
December 2020 (the "2020 Annual Accounts"). The Trustee delivered a
notice to the Company on 28 January 2022 confirming that an Event
of Default will, unless remedied, arise on 11 February 2022 in
connection with the 2020 Annual Accounts not being filed on or
prior to the filing deadline. The 2020 Annual Accounts were not
filed as of this deadline and as per the Trust Deed, an Event of
Default therefore arose on 11 February 2022 in connection with the
2020 Annual Accounts.
The Company is continuing to work alongside BDO LLP (the
"Auditor"), its auditor to finalise the 2020 Annual Accounts and
although significant progress has been made, the Company confirms
that the delay in filing remains as per the reasons set out in the
Accounts RNS. In particular, services that were previously provided
to the Company by Intu Properties plc (in administration) and
certain other members of the Intu Properties plc group, also in
administration (together, the "Administration Companies") have been
migrated to other providers. From a practical perspective, this has
resulted in significant difficulties as accounting records and
information systems previously maintained by Administration
Companies were no longer automatically available to the Company and
its Auditor for much of 2021. Requests for records have had to be
made, which have resulted in significant delays for the Auditor in
completing its work. Finally, as employees of the Administration
Companies who previously maintained these accounting and
information records have departed, there have been further
challenges for the Company and the Auditor in obtaining
clarification, when requested, with respect to information as it
has been provided.
As set out in the Valuation RNS, the Report (as defined therein)
reflects the aggregate valuation of the Properties, as at 31
December 2021 being GBP143,150,000 (the "2021 Valuation"). Clause
10.3 of the Trust Deed, provides that the value of the Mortgaged
Property must not be less than 1.5 times the value of the Final
Redemption Amount. The Company believes that the 2021 Valuation,
taking account unpaid interest and amortisation, is less than 1.5
times the value of the Final Redemption Amount. If such obligation
is not remedied, as set out more fully in clause 10.3 of the Trust
Deed, within three months of the date of delivery of the 2021
Valuation, being 18 March 2022, it shall become an Event of Default
pursuant to clause 17.1.7 of the Trust Deed within 14 days of the
Trustee requesting, in writing, that it cure the default. The
Company believes that the Proposed Restructuring will be completed
prior to any such Event of Default arising in connection with the
2021 Valuation. In any event, as part of the Proposed
Restructuring, the Company will include in the Notice of Meeting at
which Stockholders will be asked, by way of Extraordinary
Resolution, to consider and, if thought fit, approve a waiver of
any Event of Default that has arisen in connection with Clause 10.3
of the Trust Deed and to approve the deletion of the relevant
requirement from the Trust Deed.
The Company will continue to keep Stockholders notified of any
relevant developments in accordance with applicable law and
regulation.
Capitalised terms used in this Notice and not otherwise defined
shall have the meanings given to them in the Trust Deed dated 5
October 2006 (as amended and supplemented from time to time) and
the Supplemental Trust Deed dated 30 July 2020 (together, the
"Trust Deed") constituting the Stock and made between the Company,
the Charging Subsidiaries (as defined in the Trust Deed), and The
Law Debenture Trust Corporation p.l.c. (the "Trustee"), unless the
context otherwise requires.
Please note that the Trustee has not been involved in the
preparation or formulation of this announcement, the FY22 - FY24
Business Plan or the Q4 Update and expresses no views or opinions
on this announcement, the FY22 - FY24 Business Plan or the Q4
Update. Stockholders are advised to take their own legal, financial
and/or tax advice in relation to this announcement, the FY22 - FY24
Business Plan and the Q4 Update.
Stockholders should contact the following for further
information:
Company
Simmons & Simmons LLP
Citypoint
1 Ropemaker Street
London
EC2Y 9SS
United Kingdom
Email: intu@simmons-simmons.com
Attention: Peter Manning and James Taylor
Registrar
Link Group
10th Floor
Central Square
29 Wellington Street
Leeds
LS1 4DL
United Kingdom
Telephone: +44 371 664 0300
(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. Open between 09:00 -17:30,
Monday to Friday excluding public holidays in England and
Wales)
Email: shareholderenquiries@linkgroup.co.uk
Alvarez & Marsal Europe LLP and Milbank LLP have been
retained as financial and legal advisers to an ad hoc group of
Stockholders. Their contact details are as follows:
ProjectIrisAMTeam@alvarezandmarsal.com and Iris@milbank.com.
This announcement is made by Intu Debenture PLC
Dated: 14 April 2022
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END
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