21 October 2024
NOT FOR RELEASE, PUBLICATION OR
DISTRIBUTION IN WHOLE OR IN PART IN, INTO OR FROM ANY JURISDICTION
WHERE TO DO SO WOULD CONSTITUTE A VIOLATION OF THE RELEVANT LAWS OF
SUCH JURISDICTION
THIS ANNOUNCEMENT CONTAINS INSIDE
INFORMATION
FOR IMMEDIATE RELEASE
Ocean Wilsons Holdings
Limited
("Ocean Wilsons" or the
"Company")
Sale of interest in Wilson
Sons S.A. to SAS Shipping Agencies Services Sàrl
Ocean Wilsons is pleased to announce
that its wholly-owned subsidiary, OW Overseas (Investments) Limited
("OWOIL"), has agreed to
sell its 56.47% interest in Wilson Sons S.A. ("Wilson Sons") to SAS Shipping Agencies
Services Sàrl ("SAS"), a
wholly-owned subsidiary of MSC Mediterranean Shipping Company SA
("MSC"), for total cash
consideration of R$4.352 billion (equivalent to R$17.50 per share)
(the "Transaction").
Transaction highlights
· Sale
of the Company's 56.47% interest in Wilson Sons, for cash
consideration of R$4.352 billion (the "R$ Purchase Price"). The R$ Purchase
Price, before it is paid to OWOIL, will be converted from R$ to US$
at the exchange rate published by the Central Bank of Brazil as of
the business day immediately preceding the completion date. As at
18 October 2024, being the latest practicable date prior to the
publication of this announcement, the R$ Purchase Price was equal
to US$768 million.[1]
· It is
anticipated that Brazilian withholding tax in respect of capital
gains, at rates of between 15.0% and 22.5%, will be applied to
OWOIL's gain on the disposal of its interest in Wilson Sons. The
Company expects up to US$142 million (calculated using the
Applicable Exchange Rate) to be withheld by SAS pursuant to the
Brazilian capital gains tax regime (estimated on a reasonable
worst-case basis). The Company expects to ultimately realise net
cash proceeds of at least US$593 million (calculated using the
Applicable Exchange Rate) as a result of the Transaction, net of
transaction costs and taxes. The Company does not expect that
material taxes will be payable on the transaction proceeds in any
other jurisdiction. Shareholders will be updated when the amount of
Brazilian withholding tax, and consequently, the net cash proceeds
that the Company expects to receive as a result of the Transaction,
have been ascertained.
· The
Transaction agreement contemplates Wilson Sons (i) paying the
dividend declared by the Wilson Sons board of directors on 11
October 2024 and (ii) continuing to pay dividends to its
shareholders of up to the R$ equivalent of US$22 million per
quarter during the period prior to completion of the Transaction
("Completion"),
subject in each case to Wilson Sons generating
sufficient profits in the relevant quarter (the "Permitted Amount"). To the extent
Wilson Sons pays dividends in excess of the Permitted Amount, the
proportion received by OWOIL will result in a commensurate
reduction to the R$ Purchase Price.
· The
Transaction is expected to complete during the second half of 2025
and is conditional on the receipt of applicable regulatory
clearances between signing and Completion.
· The
Ocean Wilsons' Board of Directors (the "Board") is of the opinion that the
Transaction is in the best interests of Ocean Wilsons' shareholders
as a whole.
Caroline Foulger, Ocean Wilsons' Chair, commented:
"I
am delighted to announce that, following a comprehensive strategic
review of the Company's investment in Wilson Sons, we have reached
an agreement for the sale of our holding in Wilson Sons to SAS.
This transaction represents the successful realisation of our
long-term investment in Wilson Sons, demonstrating our ability to
identify opportunities to create significant value for our
shareholders.
"Our strategy has always been focused on delivering enhanced
long-term value to our shareholders by carefully balancing
investment risks and avoiding the distractions of short-term market
cycles. This sale aligns with our purpose and will allow us to
concentrate on developing the business through sustainable
profitable growth.
"Since our initial investment, Wilson Sons has demonstrated
significant financial growth and is today the largest integrated
port and maritime logistics operator in Brazil. Under SAS's
ownership, we are confident that Wilson Sons will benefit from
additional resources and support.
"The Board believes that it is a compelling time to realise
its investment. This is an exciting time for Ocean Wilsons, and we
remain committed to maximising shareholder value through strategic
decision-making and disciplined investment
growth".
Use
of net proceeds
The Board currently expects to
return a meaningful proportion of the net proceeds from the
Transaction to shareholders (for example, by way of a
special dividend or a share buyback
programme (or a combination of the two)), and is currently
reviewing a number of options with respect to the remainder, one of
which could include re-investing some or all of the remainder into
the diversified portfolio business of its wholly-owned subsidiary,
Ocean Wilsons (Investments) Limited ("OWIL").
In advance of concluding how the net
proceeds will be allocated and deployed, the Board wishes to
consult with shareholders to canvass their views and ensure that
its decision considers the views of shareholders as a whole. The
Board will provide further detail on its intended application of
the net proceeds following completion of that consultation
exercise.
Impact on Ocean Wilsons
Financial impacts of the transaction
on Ocean Wilsons are currently estimated (based on financial
statements for the period ended 30 June 2024) to be as
follows:
· The
net proceeds from the Transaction will increase the Company's net
cash position.
· The
Company will present the 'Brazil - maritime services' segment
assets and liabilities as held-for-sale until the Completion within
its future statutory accounts.
· As at
30 June 2024, the net assets of the 'Brazil - maritime services'
segment totalled US$458 million and the Company's equity included
US$203 million for non-controlling interests related to this
segment.
· The
Company would present the 'Brazil - maritime services' segment
results as discontinued operations within its future statutory
accounts and will continue to consolidate its results until
Completion takes place.
· As a
result, on Completion, the Company would recognise an accounting
gain equal to the net proceeds received by the Company adjusted for
the 'Brazil - maritime services' segment net assets, the related
non-controlling interest balance, and the realisation of the
cumulative translation reserve as at the date of
Completion.
Were the net proceeds remaining
after any return(s) to shareholders to be used solely for
investment in the diversified portfolio business of OWIL, the
remaining business of Ocean Wilsons and its subsidiaries (the
"Group") would consist only
of that business. The Board is aware that, in this scenario, it may
be deemed necessary for the Company to transfer its listing from
the FCA's equity shares (commercial companies) listing category to
its closed-ended investment funds category. Any such transfer of
listing category would be subject to a shareholder vote in
accordance with the UK Listing Rules. The Board expects to consult
with shareholders as to any consequential change of listing
category as part of its consultation on the use of the net
proceeds.
Assets of Wilson Sons
As at 30 June 2024, the value of the
gross assets of Wilson Sons was US$1.126 billion. In the 2023
financial year, the profit after tax attributable to the assets the
subject of the Transaction was US$81 million.
OWOIL has a 56.47% economic interest
in Wilson Sons.
Next steps and timing
The Transaction is expected to
complete during the second half of 2025. The Transaction is
conditional upon the satisfaction of the Conditions (as defined in
Appendix V (Material
Contracts) to this announcement).
Additional information
The Transaction is a significant
transaction for the purposes of Chapter 7 of the UK Listing Rules
due to the agreed total consideration exceeding 25% of Ocean
Wilson's market capitalisation. As such, this announcement is made
in accordance with Ocean Wilsons' disclosure obligations pursuant
to Chapter 7 of the UK Listing Rules.
Unless otherwise stated, all
financial information relating to Ocean Wilsons and Wilson Sons
disclosed in the announcement has been extracted from the Ocean
Wilsons' published audited Consolidated Financial Statements for
the year ended 31 December 2023 and 2022 or from the Ocean Wilsons'
published unaudited Interim Consolidated Financial Statements for
the period ended 30 June 2024, which were all prepared in
accordance with International Financial Reporting
Standards.
Certain figures included in this
announcement have been rounded. Accordingly, figures shown as
totals may not be an arithmetic aggregation of the figures that
precede them.
The Company is being advised by BTG
Pactual (financial adviser), Slaughter and May (English law legal
advisers), Pinheiro Guimarães Advogados (Brazilian law legal
advisers) and Peel Hunt LLP (UK financial adviser and
broker).
The person responsible for arranging
for the release of this announcement on behalf of the Company is
Leslie Rans, Chief Operating and Financial Officer.
About Ocean Wilsons
Ocean Wilsons is a Bermuda
investment holding company listed on both the London Stock Exchange
and the Bermuda Stock Exchange. The Group comprises two primary
investments, Ocean Wilsons (Investments) Limited, an entity
that holds an actively managed diversified portfolio of
international investments, and Wilson Sons.
LEI: 213800U1K395G8PK4I21
About Wilson Sons
Wilson Sons is listed on the B3
Brazilian stock exchange (B3 S.A. - Brasil, Bolsa, Balcão) and is one of
the largest providers of maritime services in Brazil with
activities including towage, container terminals, offshore oil and
gas support services, small vessel construction, logistics and ship
agency. Wilson Sons has a presence in most major ports in
Brazil.
Wilson Sons is led by its CEO,
Fernando Salek, and overseen by its board of directors.
About SAS and MSC
SAS is a wholly-owned subsidiary of
MSC Mediterranean Shipping Company SA. MSC is a private global
leader in transportation and logistics founded in 1970 and
headquartered in Geneva, Switzerland. It is owned and managed by
the Aponte family. MSC has evolved from a one vessel operation into
a global business with a fleet of more than 850 vessels and a team
of over 200,000 employees. SAS is, inter alia, the controlling
shareholder of Log-In-Logística Intermodal S.A.
FOR FURTHER INFORMATION PLEASE CONTACT
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Ocean Wilsons Holdings Limited
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+1 (441)
295 1309
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Leslie Rans
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|
|
|
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Peel Hunt LLP - Financial Adviser and Broker to Ocean
Wilsons
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+44 (0)
207 418 8900
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Ed Allsopp
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Charles Batten
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Tom Graham
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IMPORTANT NOTICES
No statement in this announcement is
intended as a profit forecast and no statement in this announcement
should be interpreted to mean that the future earnings per share,
profits, margins or cash flows of Ocean Wilsons following the
Transaction will necessarily match or be greater than the
historical published earnings per share, profits, margins or cash
flows of Ocean Wilsons.
This announcement 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
"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. Forward-looking statements may and often do differ
materially from actual results. Any forward-looking statements
reflect Ocean Wilsons' current view with respect to future events
and are subject to risks relating to future events and other risks,
uncertainties and assumptions relating to Ocean Wilsons' business,
results of operations, financial position, liquidity, prospects,
growth and strategies. Forward-looking statements speak only as of
the date they are made.
You are advised to read this
announcement in its entirety for a further discussion of the
factors that could affect the Group's future performance. In light
of these risks, uncertainties and assumptions, the events described
in the forward-looking statements in this announcement may not
occur.
This announcement does not
constitute and should not be construed as, an offer to purchase or
sell or issue securities, or otherwise constitute an inducement,
invitation, commitment, solicitation or recommendation to any
person to purchase, subscribe for, or otherwise acquire securities
in Ocean Wilsons, or constitute an inducement to enter into any
investment activity in any jurisdiction. Nothing contained in this
announcement is intended to, nor shall it, form the basis of, or be
relied on in connection with, any contract or commitment whatsoever
and, in particular, must not be used in making any investment
decision.
The distribution of this
announcement in or from certain jurisdictions may be restricted or
prohibited by the laws of any jurisdiction other than the UK.
Recipients of this announcement are required to inform themselves
of, and comply with, all restrictions or prohibitions in such other
jurisdictions. Any failure to comply with applicable requirements
may constitute a violation of the laws and/or regulations of such
other jurisdictions.
Peel Hunt LLP ("Peel Hunt"), which is authorised and
regulated in the United Kingdom by the FCA, is acting exclusively
as financial adviser and broker to Ocean Wilsons and for no one
else in connection with the matters referred to in this
announcement and will not be responsible to any person other than
Ocean Wilsons for providing the protections afforded to clients of
Peel Hunt, nor for providing advice in relation to the matters
referred to herein. Neither Peel Hunt 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 Peel
Hunt in connection with the matters referred to in this
announcement, or otherwise.
Save as required by the Market Abuse
Regulation, the Disclosure Guidance and Transparency Rules, the UK
Listing Rules or by applicable law, each of Ocean Wilsons, Peel
Hunt and their respective affiliates and representatives expressly
disclaim any intention, obligation or undertaking to update, review
or revise any of the information or the conclusions contained
herein, including forward-looking or other statements contained in
this announcement, or to correct any inaccuracies which may become
apparent whether as a result of new information, future
developments or otherwise.
APPENDIX I
FINANCIAL INFORMATION
Key
historical financial information on Wilson Sons
|
Balance Sheet[2]
expressed in thousands of
US$
|
|
|
|
|
|
|
|
|
|
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31-Dec-22
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31-Dec-23
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30-Jun-24
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Total Assets
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1,098,393
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1,191,179
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1,126,396
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|
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Total Liabilities
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646,339
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704,976
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668,388
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|
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Net
Asset Value
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452,054
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486,203
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458,008
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|
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|
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Income Statement[3]
expressed in thousands of
US$
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|
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FY 2022
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FY 2023
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30-Jun-24
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|
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Sale of services
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440,107
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486,646
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262,363
|
|
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Operating expenses
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(257,834)
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(284,502)
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(154,356)
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Depreciation and
Amortisation
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(64,435)
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(71,768)
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(37,052)
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Operating Profit
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117,838
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130,376
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70,955
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|
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Share of results of joint ventures
and associates
|
3,165
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6,447
|
103
|
|
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Other income
|
6,631
|
7,593
|
4,701
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|
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Finance costs
|
(34,509)
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(35,425)
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(18,512)
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|
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Profit before tax
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93,125
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108,991
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57,247
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Income tax expense
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(26,656)
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(27,609)
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(27,231)
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Profit for the period
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66,469
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81,382
|
30,016
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|
|
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APPENDIX II
RELATED PARTY TRANSACTIONS
Save as set out immediately below
and other than those matters disclosed in the Company's previously
published Annual Reports and Financial Statements, Ocean Wilsons
has not entered into any related party transactions (within the
meaning ascribed to that term in UK-adopted international
accounting standards) during any of the financial years ended 31
December 2022, 31 December 2023 and otherwise up to the date of
this announcement.
In connection with the Transaction,
Wilson Sons has entered into retention and non-compete arrangements
(the "Retention and Non-Compete
Arrangements") with certain members of Wilson Sons' senior
management who are treated as related parties of the Company
pursuant to IAS 24 (Related Party
Disclosures) (the "Recipients"). As part of the Retention
and Non-Compete Arrangements, and conditional on Completion taking
place, a maximum aggregate amount of R$133 million (or US$23
million, for illustrative purposes, calculated using the Applicable
Exchange Rate) (the "Retention and
Non-Compete Payments") will be paid to the Recipients in
consideration for the Recipients' agreement to remain in their
respective positions at Wilson Sons and the provision by the
Recipients of certain non-compete and non-solicitation covenants.
Subject to Completion taking place, the Retention and Non-Compete
Payments will be paid in cash as follows: (i) a portion of between
84-90% (depending on the Recipient) on Completion; and (ii) the
remainder of between 10-16% (depending on the Recipient) (the
"Second Payment") on the
36-month anniversary of Completion (the "Second Payment Date"). The Second
Payment is conditional upon the Recipients being in the continuous
employment of Wilson Sons from the date of Completion to (and
including) the Second Payment Date.
The cost of the Retention and
Non-Compete Arrangements will be borne by Wilson Sons and will not
result in any adjustment to the R$ Purchase Price.
APPENDIX III
SIGNIFICANT CHANGE IN THE ISSUER'S FINANCIAL
POSITION
1. Ocean Wilsons - There has been no significant
change in the financial performance or financial position of Ocean
Wilsons since 30 June 2024, being the end of the last financial
period for which financial information of Ocean Wilsons has been
published.
2. Wilson Sons - There has been no significant
change in the financial performance or financial position of Wilson
Sons since 30 June 2024, being the end of the last financial period
for which financial information of Wilson Sons has been
published.
APPENDIX IV
LEGAL AND ARBITRATION PROCEEDINGS
1. Ocean Wilsons - There
are no legal or arbitration proceedings (including any such
proceedings which are pending or threatened of which Ocean Wilsons
is aware) during a period covering the 12 months prior to the date
of this announcement which may have, or have had in the recent
past, a significant effect on Ocean Wilsons' financial position or
profitability.
2. Wilson Sons - There
are no legal or arbitration proceedings (including any such
proceedings which are pending or threatened of which Ocean Wilsons
is aware) during a period covering the 12 months prior to the date
of this announcement which may have, or have had in the recent
past, a significant effect on Wilson Sons and/or Wilson Sons'
financial position or profitability.
APPENDIX V
MATERIAL CONTRACTS
1. Ocean Wilsons
Share purchase agreement
Parties and structure
The Transaction is governed by a
share purchase agreement ("Share
Purchase Agreement") entered into between Ocean Wilsons,
OWOIL and SAS. Pursuant to the Share Purchase Agreement and subject
to the Conditions (as defined below), OWOIL has agreed to sell, and
SAS has agreed to purchase, the shares owned by OWOIL in the
capital of Wilson Sons (being 248,664,000 shares and representing
56.47% of Wilson Sons). The Company has agreed to guarantee OWOIL's
obligations, commitments and undertakings arising under or in
connection with the Share Purchase Agreement
Consideration
The consideration for the
Transaction comprises R$4.352 billion in cash (the "Consideration"), representing the
agreed share price of R$17.50/share multiplied by the number of
Wilson Sons shares held by OWOIL at Completion. To the extent that
Wilson Sons has paid or pays dividends which are not permitted
dividends (being dividends in excess of those permitted under the
Share Purchase Agreement, including those described in the section
titled 'Transaction Highlights') during the
period from (and excluding) 31 December 2023 to Completion, OWOIL's
portion of such dividends shall be deducted from the Consideration
payable at Completion.
Conditions
The Transaction conditional upon SAS
obtaining final approval for the Transaction under the applicable
merger control laws from the Brazilian Administrative Council for
Economic Defense (Conselho
Administrativo de Defesa Econômica - CADE) (the
"Antitrust Condition"),
obtaining final approval under the applicable regulatory laws from
the Brazilian National Waterway Transportation Agency (Agência Nacional de Transportes
Aquaviários - ANTAQ) (the "ANTAQ Condition") and obtaining certain
consents and/or waivers from certain of Wilson Sons' lenders in
relation to the Transaction (the "Bank Consents Condition" and, together
with the Antitrust Condition and the ANTAQ Condition, the
"Conditions"). The
Antitrust Condition and the ANTAQ Condition may not be waived by
any party. The Bank Consents Condition may be waived by SAS or,
following the satisfaction of the Antitrust Condition and the ANTAQ
Condition, by OWOIL.
SAS will be required, amongst other
obligations, to use its best endeavours to satisfy the Conditions
as soon as reasonably practicable and in any event by 21 January
2026 (the "Long Stop
Date"), by which time, if any of the Conditions have not
been satisfied or (where applicable) waived, then (subject to the
parties' rights to extend the Long Stop Date by up to 20
business days), the Share Purchase Agreement will automatically
terminate.
Break fee
If the Antitrust Condition or the
ANTAQ Condition have not been satisfied on or before 5.00pm on the
Long Stop Date (including, if applicable, as extended by the
parties), the Share Purchase Agreement shall automatically
terminate and a break fee of US$80 million in cash (the
"Break Fee") shall be
payable by SAS to OWOIL.
The Break Fee will not be payable
where the failure to satisfy the Antitrust Condition or the ANTAQ
Condition is due to the material breach by OWOIL of its obligations
under the Share Purchase Agreement in relation to the satisfaction
of such Conditions, or where such material breach materially
contributes to the failure to satisfy such Conditions.
Warranties
OWOIL has given to SAS customary
fundamental warranties as well as warranties relating to
anti-bribery, anti-corruption and sanctions matters.
Termination rights
SAS may terminate the Share Purchase
Agreement if (i) an event occurs in relation to anti-bribery,
anti-corruption or sanctions matters which is publicly disclosable
by Wilson Sons and gives rise to a material adverse effect on
Wilson Sons and its subsidiaries (an "ABC Material Adverse Change") or (ii) a
material inaccuracy in certain of Wilson Sons' public disclosures
is identified. OWOIL will also be entitled to terminate the Share
Purchase Agreement if an ABC Material
Adverse Change occurs.
Governing law and jurisdiction
The Share Purchase Agreement is
governed by English law. The English courts will have exclusive
jurisdiction to settle any dispute arising out of or in connection
with the agreement.
ENDS
[1] R$:US$
exchange rate of 5.6672:1 (the "Applicable Exchange Rate").
[2] Unaudited historical financial information extracted from the
underlying internal financial accounting records that support Ocean
Wilsons': (i) annual audited consolidated financial statements for
the last two fiscal years; and (ii) 30 June 2024 unaudited interim
consolidated financial statements (together, the "Consolidated Financial Statements").
The financial information is prepared on a basis which is
consistent with the Consolidated Financial Statements.
[3] Unaudited historical financial information extracted from the
underlying internal financial accounting records that support Ocean
Wilsons': (i) annual audited consolidated statement of profit or
loss for the last two fiscal years; and (ii) 30 June 2024 unaudited
interim consolidated statement of profit or loss (together, the
"Consolidated Statements of Profit
and Loss"). The financial information is prepared on a
basis which is consistent with the Consolidated Statements of
Profit and Loss.