TIDMDPEU
RNS Number : 5963X
DP Eurasia N.V
21 December 2023
THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION
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
FOR IMMEDIATE RELEASE
21 December 2023
DP Eurasia N.V.
("DP Eurasia" or the "Company", and together with its
subsidiaries, the " Group ")
Response to the Statement from Jubilant Foodworks
Introduction
DP Eurasia, the master franchisee of the Domino's Pizza brand in
Turkey, Azerbaijan and Georgia, notes the announcement yesterday by
Jubilant Foodworks Netherlands B.V. ("Jubilant Foodworks"), a
wholly owned subsidiary of Jubilant Foodworks Limited ("Jubilant"),
in connection with its revised cash offer of 95 pence per share (a
"DP Eurasia Share") for the entire issued and outstanding share
capital ("DP Eurasia Share Capital") of the Company not already
owned by Jubilant Foodworks (the "Revised Offer").
The non-conflicted members of the board of the Company (the
"Board") reiterate that, on fair terms, a de-listing could be in
the interests of the Company and its various stakeholders and that
it would consider recommending an offer price that reflects the
fair value of the business in the context of the majority stake
Jubilant Foodworks owns in the Company. However, and as was
communicated to Jubilant Foodworks on 19 December 2023, the Revised
Offer price is not this price.
Indication of minority shareholder support
The Board has consulted extensively with its key institutional
shareholders, in aggregate representing 31.59 per cent. of the DP
Eurasia Share Capital and 69.70 per cent. of the DP Eurasia Share
Capital not currently owned by Jubilant Foodworks . There is
unanimous agreement from these shareholders for the Company to
confirm publicly that none of them currently intend to accept the
Revised Offer. As long as this status quo is maintained, Jubilant
Foodworks cannot, without the support of these shareholders,
de-list the Company or put in place any of the mechanisms to
squeeze out the minority shareholders set out in its offer
document.
The Board intends to use this strength of shareholder support to
encourage Jubilant Foodworks to offer a fair price that the Board
can recommend and that shareholders are willing to accept.
Below the Board has set out its response to correct certain
statements made by Jubilant Foodworks in its announcement of 20
December 2023 which in the Board's opinion are either wrong,
misleading or highly subjective.
Minority Protections
-- The Board is glad that Jubilant Foodworks has undertaken,
through its offer document, that all shareholders accepting the
Revised Offer will benefit from any price increases offered by
Jubilant Foodworks during the period of the Revised Offer. The
Board hopes that this should provide comfort to shareholders that
there is no reason for any of them to take any action at this time.
There is nothing else within the Jubilant Foodworks offer document
which renders anything in the Company's response statement of 19
December 2023 misleading.
-- Jubilant Foodworks claims that it takes its obligations to
minority shareholders seriously. As such the Board observes with
surprise that in its offer document it sets out in great detail the
draconian options it would have if the Company were to be delisted
to encourage the squeeze out of minority shareholders while not
offering any matched bargain or other liquidity mechanism to
provide shareholders an exit, ever, beyond 18 January 2023.
Valuation
The Board wishes to make the following observations:
-- Valuation is inherently subjective. The Board and its
financial advisers carefully considered a range of methodologies,
all of which triangulated to a valuation range which has been
communicated to Jubilant Foodworks . The Board chose to show a
range of Domino's Pizza multiples as fairly illustrative of that
range before accounting for the hyper-inflationary environment in
Turkey. Conversely, Jubilant Foodworks provides a list of companies
around the globe seemingly selectively based on their low valuation
multiples.
-- Jubilant Foodworks argues that it is offering a higher
implied multiple by virtue of its use of year end spot exchange
rates to determine GBP equivalent values, resulting in the
calculation of a depressed GBP EBITDA. The Board remains of the
view that it is customary to use average exchange rates for the
relevant period for income statement items.
-- Jubilant Foodworks argues that the DP Eurasia Share Price
remained below the 2021 hostile reverse bookbuild offer price, but
it omits to acknowledge the low trading volume in DP Eurasia Shares
which is a function of Jubilant Foodworks ' significant holding,
and the challenges of the Ukraine war resulting in the loss of the
Company's Russian business, and Turkey's current hyper-inflationary
environment. It also fails to acknowledge the exemplary way in
which the Company has navigated and rebuilt from those
challenges.
-- Jubilant Foodworks seeks to challenge broker forecasts as
unreliable and by inference optimistic, while not acknowledging
that the Company's Profit Forecast is in excess of those
forecasts.
The Board, having taken advice from its financial advisors,
Liberum, is unanimous in not recommending the Revised Offer and
continues to urge minority shareholders to take no action. The
Board, however, remains committed to continue negotiations
expeditiously with Jubilant Foodworks.
Enquiries
DP Eurasia N.V.
İlknur Kocaer, CFA - Investor Relations
Director +90 212 280 9636
Buchanan (Financial Communications)
Richard Oldworth / Toto Berger / Verity +44 20 7466 5000
Parker dp@buchanan.uk.com
Liberum (Financial Adviser, Corporate
Broker)
Corporate Broking: Andrew Godber / Edward
Thomas / Will King
M&A: Tim Medak / Mark Harrison / Matt Hogg +44 20 3100 2000
Important Notices
For the purposes of the matters referred to in this
announcement, the Board comprises the directors of the Company
excluding those directors recused by reason of conflict of
interest. Those directors so recused are Shyam S. Bhartia and Hari
S. Bhartia (both of whom are appointees connected with Jubilant)
and Aslan Saranga, the Company's Chief Executive Officer, who is
recused by reason of the conflict of interest in light of his
discussions with Jubilant Foodworks on his shareholding in the
Company and his likely continuation as CEO. References in this
announcement to the "Board" are to be construed accordingly.
Liberum Capital Limited ("Liberum"), which is authorised and
regulated in the United Kingdom by the FCA, is acting as financial
adviser exclusively for the Company and no one else in connection
with the matters set out in this announcement and will not regard
any other person as its client in relation to the matters set out
in this announcement and will not be responsible to anyone other
than the Company for providing the protections afforded to clients
of Liberum, nor for providing advice in relation to the contents of
this announcement or any other matter referred to herein. Neither
Liberum 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 Liberum in
connection with this announcement, any statement contained herein
or otherwise. Neither Liberum nor any of its affiliates nor any of
their respective directors, officers, employees, advisers or agents
accepts any responsibility or liability whatsoever for, or makes
any representation or warranty, express or implied, as to, the
truth, accuracy or completeness of the information in this
announcement (or whether any information has been omitted from the
announcement) or any other information relating to the Company.
This announcement is not intended to, and does not, constitute
or form part of any 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 this announcement
or otherwise. The distribution of this announcement in
jurisdictions other than the United Kingdom and the availability of
any offer to shareholders of the Company who are not resident in
the United Kingdom may be affected by the laws of relevant
jurisdictions. Therefore, any persons who are subject to the laws
of any jurisdiction other than the United Kingdom or shareholders
of the Company who are not resident in the United Kingdom will need
to inform themselves about, and observe any applicable
requirements.
Forward-looking statements
This document, including information included or incorporated by
reference in this document, may include statements that are, or may
be deemed to be, "forward-looking statements". These
forward-looking statements may be identified by the use of
forward-looking terminology, including the terms "targets",
"believes", "estimates", "plans", "projects", "anticipates",
"expects", "intends", "may", "will" or "should" or, in each case,
their negative or other variations or comparable terminology, or by
discussions of strategy, plans, objectives, goals, future events or
intentions. These forward-looking statements include all matters
that are not historical facts and involve predictions.
Forward-looking statements may and often do differ materially from
actual results. Any forward-looking statements reflect the
Company's 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 business,
results of operations, financial position, liquidity, prospects,
growth or strategies and the industry in which it
operates. Forward-looking statements speak only as of the date
they are made and cannot be relied upon as a guide to future
performance. There are many factors that could cause actual results
to differ materially from those expressed or implied in
forward-looking statements. Among such factors are changes in the
global, political, social, economic, business, competitive, market
and regulatory forces, future exchange and interest rates, changes
in tax rates, future business combinations or disposals, and any
epidemic, pandemic or disease outbreak.
These forward-looking statements are based on numerous
assumptions regarding the present and future business strategies of
such persons and the environment in which each will operate in the
future. By their nature, these forward-looking statements involve
known and unknown risks and uncertainties because they relate to
events and depend on circumstances that will occur in the future.
The factors described in the context of such forward-looking
statements in this document may cause the actual results,
performance or achievements of any such person, or industry results
and developments, to be materially different from any results,
performance or achievements expressed or implied by such
forward-looking statements. No assurance can be given that such
expectations will prove to have been correct and persons reading
this document are therefore cautioned not to place undue reliance
on these forward-looking statements that speak only as at the date
of this document. All subsequent oral or written forward-looking
statements attributable to the Company or its affiliates or any
persons acting on its behalf are expressly qualified in their
entirety by the cautionary statement above. The Company does not
intend, nor undertakes any obligation, to update publicly or revise
forward-looking statements, whether as a result of new information,
future events or otherwise, except to the extent legally
required.
UK Market Abuse Regulation
This announcement contains inside information for the purposes
of Article 7 of Regulation (EU) No 596/2014 of the European
Parliament and the Council of 16 April 2014 as it forms part of
domestic law in the United Kingdom by virtue of the European Union
(Withdrawal) Act 2018.
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END
MSCFEESWFEDSESE
(END) Dow Jones Newswires
December 21, 2023 02:03 ET (07:03 GMT)
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