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
THAT JURISDICTION
FOR IMMEDIATE
RELEASE
THIS ANNOUNCEMENT CONTAINS INSIDE
INFORMATION
29 April 2024
RECOMMENDED CASH
ACQUISITION
of
HIPGNOSIS SONGS FUND
LIMITED
by
LYRA BIDCO LIMITED
(a newly-formed company indirectly
wholly-owned by investment funds advised by affiliates of
Blackstone Inc.)
to be implemented by means of a takeover
offer for the purposes of section 337 of the Companies (Guernsey)
Law, 2008 (as amended)
Summary
· The
boards of directors of Lyra Bidco Limited ("Bidco") and Hipgnosis Songs Fund
Limited ("Hipgnosis") are
pleased to announce that they have reached agreement on the terms
and conditions of a recommended cash acquisition by Bidco of the
entire issued, and to be issued, ordinary share capital of
Hipgnosis.
· It is
intended that the Acquisition will be implemented by way of a
takeover offer for the purposes of section 337 of the Companies
Law. Bidco reserves the right to elect to implement the Acquisition
by way of a Scheme as an alternative to the Offer, subject to the
Panel's consent and the terms of the Cooperation Agreement.
· Under the
terms of the Acquisition, each Hipgnosis Shareholder will be
entitled to receive:
for each Hipgnosis Share:
$1.30
in cash
· The GBP
equivalent value of the Acquisition Price based on the Announcement
Exchange Rate, being 104 pence, represents a premium of
approximately:
· 4.0 per
cent. to the implied offer price of the Concord Revised Offer;
· 48.1 per
cent. to the Closing Price of 71 pence per Hipgnosis Share on 17
April 2024 (being the last Business Day before the commencement of
the Offer Period);
· 53.6 per
cent. to the volume-weighted average price of 68 pence per
Hipgnosis Share for the one-month period ended 17 April 2024 (being
the last Business Day before the commencement of the Offer
Period);
· 58.1 per
cent. to the volume-weighted average price of 66 pence per
Hipgnosis Share for the three-month period ended 17 April 2024
(being the last Business Day before the commencement of the Offer
Period); and
· 16.9 per
cent. to Hipgnosis' Adjusted 30 September 2023 Operative NAV per
Hipgnosis Share of $1.11.
· The
Acquisition values Hipgnosis' entire issued, and to be issued,
ordinary share capital at approximately $1,572 million (which is
equivalent to £1,262 million based on the Announcement Exchange
Rate).
·
The terms of the Acquisition
represent an attractive premium for Hipgnosis Shareholders over the
terms of the Concord Revised Offer and accordingly the Hipgnosis
Shareholders are urged to take no action in respect of the Concord
Revised Offer.
·
Bidco will procure that a facility will be made available
under which Hipgnosis Shareholders will be able to elect (subject
to the terms and conditions of the facility) to receive the cash
consideration in Sterling (after deduction of any transaction or
dealing costs associated with the conversion) at the applicable
market exchange rate on the latest practicable date for fixing such
rate prior to the relevant payment date. Further details of this
facility and the election by Hipgnosis Shareholders wishing to
receive their cash consideration in Sterling will be set out in the
Offer Document and the Form of Election. On the basis of the
Announcement Exchange Rate, the cash consideration implies an
equivalent value of 104 pence per Hipgnosis Share. For any
Hipgnosis Shareholder electing to be paid their cash consideration
in Sterling, the amount per Hipgnosis Share received may, depending
on the prevailing exchange rate, result in a payment below or above
104 pence per Hipgnosis Share.
· If, on or
after the date of this announcement and prior to completion of the
Acquisition, any dividend and/or other distribution is announced,
declared, made or paid or becomes payable in respect of the
Hipgnosis Shares with a record date prior to completion of the
Acquisition, Bidco reserves the right to reduce the consideration
payable under the terms of the Acquisition for the Hipgnosis Shares
by an amount up to the aggregate amount of such dividend and/or
distribution, in which case any reference in this announcement to
the consideration payable under the terms of the Acquisition will
be deemed to be a reference to the consideration as so reduced. Any
exercise by Bidco of its rights referred to in this paragraph shall
be the subject of an announcement and, for the avoidance of doubt,
shall not be regarded as constituting any revision or variation of
the terms of the Offer or the Acquisition. In such circumstances,
Hipgnosis Shareholders would be entitled to retain any such
dividend or distribution declared, made or paid.
Recommendation
· In light
of the terms of the Acquisition as compared to the Concord Revised
Offer, the Hipgnosis Directors, who have been so advised by Singer
Capital Markets as to the financial terms of the Acquisition,
unanimously consider the terms of the Acquisition to be fair and
reasonable. In providing its advice to the Hipgnosis Directors,
Singer Capital Markets has taken into account the commercial
assessments of the Hipgnosis Directors. Singer Capital Markets is
providing independent financial advice to the Hipgnosis Directors
for the purposes of Rule 3 of the Takeover Code.
·
Accordingly, the Hipgnosis
Directors intend to recommend unanimously that Hipgnosis
Shareholders should accept or procure the acceptance of the Offer,
or (in the event that the Acquisition is implemented by way of a
Scheme), to vote in favour of the Scheme at the requisite Court
Meeting and the Resolutions at a General Meeting of Hipgnosis
Shareholders.
·
Given their intended
recommendation of the terms of the Acquisition, the Hipgnosis
Directors have decided unanimously to withdraw their recommendation
of the Concord Revised Offer.
Background to and reasons for the Acquisition
·
Blackstone's history of investments covers a wide range of sectors
and business structures that all have in common a focus to build
and grow the businesses in which it invests. Blackstone has a
particularly strong focus on the media and entertainment sectors,
covering music rights as well as the broader universe of
asset-backed strategies. Among its investments within the media and
entertainment sectors, through its portfolio company Hipgnosis
Songs Assets, managed by Hipgnosis Song Management Limited
("HSM" or the "Investment Adviser") which is majority
owned by Blackstone, Blackstone owns music rights catalogues from
leading artists and songwriters. Blackstone's other investments in
the space include SESAC, the US performance rights society and
Candle Media.
·
Blackstone continues to invest thematically in content across the
wider entertainment industry. Blackstone has closely tracked the
performance of Hipgnosis and has been a long term admirer of the
music rights catalogues owned by Hipgnosis. Blackstone will seek to
further enhance the value of the acquired rights in collaboration
with the songwriters, artists and producers who entrusted Hipgnosis
to safeguard their legacy.
·
Blackstone has worked collaboratively with the Hipgnosis Board to
ensure that its offer represents a fair and reasonable outcome for
all shareholders.
Background to and reasons for the recommendation
· On 18
April 2024, the boards of Hipgnosis and Concord announced that they
had reached agreement on the terms of a recommended cash offer
pursuant to which Concord would acquire the entire issued and to be
issued share capital of Hipgnosis for $1.16 per Hipgnosis Share
(with a further contingent consideration of up to $0.020 per
Hipgnosis Share).
· On 20
April 2024, Blackstone announced a possible offer for the entire
issued and to be issued share capital of Hipgnosis at a price of
$1.24 per Hipgnosis Share.
· On 24
April 2024, the boards of Hipgnosis and Concord announced that they
had reached agreement on the terms and conditions of an increased
recommended cash offer pursuant to which Concord would acquire the
entire issued and to be issued share capital of Hipgnosis at a
price of $1.25 per Hipgnosis Share (the "Concord Revised Offer").
·
Under the terms of the Acquisition from Bidco announced
today, each Hipgnosis shareholder would receive $1.30 per Hipgnosis
Share, representing a premium of $0.05 per Hipgnosis Share (4.0 per
cent.) compared to the Concord Revised Offer. The Hipgnosis Board
has concluded, after careful consideration, that the Acquisition
represents a superior offer for Hipgnosis Shareholders as compared
with the Concord Revised Offer.
·
Accordingly, the Hipgnosis Board has decided to withdraw its
recommendation for the Concord Revised Offer and intends to
unanimously recommend that Hipgnosis Shareholders accept or procure
the acceptance of the Acquisition, or (in the event that the
Acquisition is implemented by way of a Scheme), to vote in favour
of the Scheme at the requisite Court Meeting and the Resolutions at
a General Meeting of Hipgnosis Shareholders.
Information relating to Bidco and Blackstone
· Bidco is
a private limited company incorporated under the laws of England
and Wales on 25 April 2024, whose registered office is at 40
Berkeley Square, London, W1J 5AL, United Kingdom with registered
number 15680043. Bidco is a newly-formed company indirectly
wholly-owned by investment funds advised by affiliates of
Blackstone. Bidco was formed for the purposes of the Acquisition
and has not traded since its date of incorporation, nor has it
entered into any obligations other than in connection with the
Acquisition.
·
Blackstone is one of the world's leading investment firms.
Blackstone seeks to create positive economic impact and long-term
value for our investors, the companies we invest in and the
communities in which we work. Blackstone does this by using
extraordinary people and flexible capital to help companies solve
problems. Blackstone's $1 trillion in assets under management as at
31 December 2023 includes investment vehicles focused on private
equity, real estate, public debt and equity, life sciences, growth
equity, opportunistic, non-investment grade credit, real assets and
secondary funds, all on a global basis. Further information is
available at www.blackstone.com.
Information relating to Hipgnosis
· Hipgnosis
was launched in 2018 to offer investors a pure-play exposure to
music royalties and their associated intellectual property rights
with a focus on building a diversified portfolio, acquiring
catalogues that are built around proven hit songs by some of the
most talented and important songwriters globally.
· Since
launch, Hipgnosis has built a portfolio currently comprising 138
catalogues with more than 40,000 songs, containing copyright and
income streams derived from compositions performed by some of the
top artists of the last 50 years. Hipgnosis' portfolio is
diversified across genres, artists, vintages and right types.
· Hipgnosis
is a non-cellular Guernsey company registered with the GFSC as a
closed-ended collective investment scheme whose ordinary shares are
admitted to the Premium Listing Segment of the FCA's Official List
and admitted to trading on the Main Market of the London Stock
Exchange. It is a self-managed AIF under the EU AIFM Directive and
the UK AIFMD.
Timetable and conditions
· It is
intended that the Acquisition will be implemented by way of a
takeover offer for the purposes of section 337 of the Companies Law
(although Bidco reserves the right to elect to implement the
Acquisition by way of a Scheme, subject to the Panel's consent and
the terms of the Cooperation Agreement).
· The Offer
will be conditional on, among other things, valid acceptances being
received (and not validly withdrawn) by not later than 1.00 p.m.
(London time) on the unconditional date (or such later time(s)
and/or date(s) as Bidco may, with the consent of the Panel, decide)
in respect of such number of Hipgnosis Shares as shall, when
aggregated with any Hipgnosis Shares acquired or unconditionally
agreed to be acquired (whether pursuant to the Offer or otherwise)
by Bidco, represent Hipgnosis Shares carrying not less than 55 per
cent. of the voting rights then exercisable at a general meeting of
Hipgnosis Shareholders (or such lower percentage as Bidco may
decide), provided that Bidco shall hold or have acquired or agreed
to acquire (whether pursuant to the Offer or otherwise), directly
or indirectly, Hipgnosis Shares carrying in aggregate more than 50
per cent. of the voting rights then normally exercisable at a
general meeting of Hipgnosis (the "Acceptance Condition"). Unless the
Panel agrees otherwise, the Acceptance Condition shall only be
capable of being satisfied when all other Conditions have been
satisfied or waived.
· The
Acquisition is subject to the satisfaction or, where applicable,
waiver of the Conditions. The Conditions to the Acquisition are set
out in full in Appendix 1 to this announcement along with
certain other terms; and the full terms and conditions will be
provided in the Offer Document.
· It is
expected that the Offer Document, containing further information
about the Acquisition and specifying the actions to be taken by
Hipgnosis Shareholders in respect of the Offer, will be published
(with the accompanying form of acceptance) as soon as practicable
and in any event within 28 days of this announcement. "Day 60" of
the Takeover Code timetable will be the day falling 60 days after
publication of the Offer Document (or such other date as may be
determined by Bidco with the agreement of the Panel to be the last
date for fulfilment of the Acceptance Condition).
· The
Acquisition is currently expected to complete during the third
quarter of 2024, subject to the satisfaction or (where applicable)
waiver of the Conditions. An expected timetable of key events
relating to the Acquisition will be set out in the Offer
Document.
·
Commenting on this
announcement, Robert Naylor,
the Chair of Hipgnosis, said:
"The Board is
pleased to unanimously recommend this US$1.6 billion Offer for
Hipgnosis from Blackstone. Since we started our strategic review,
we have been clearly focused on looking at all the options to
deliver shareholder value. We are delighted that, following
competitive interests in acquiring Hipgnosis, our investors now
have a chance to immediately realise their holding at an increased
premium."
·
Commenting on this announcement, Qasim Abbas, Senior Managing
Director of Blackstone, said:
"Our offer price,
which has been unanimously recommended by the Board, represents a
significant premium to the unaffected share price and allows
shareholders to realise immediate and attractive value for their
shareholding. The offer is the result of extensive discussion and
negotiations with the Board and provides shareholders the certainty
of cash today.
Blackstone is a
long-term investor with deep experience of investing across the
media and entertainment sectors, including in music rights. The
breadth of the Blackstone platform, combined with our operational
expertise, will support and enhance the value of the acquired
rights."
This summary
should be read in conjunction with, and is subject to, the
following announcement and the Appendices. The conditions to, and
certain further terms of, the Acquisition are set out in Appendix
1. The bases and sources for certain financial information
contained in this announcement are set out in Appendix 2. Certain
definitions and terms used in this announcement are set out in
Appendix 3.
Enquiries
Jefferies (Financial Adviser to
Bidco and Blackstone)
Philip Noblet / Chris Cottrell /
Harry Le May / Stuart Klein
|
+44 207 029
8000
|
Teneo (Financial PR Adviser
to Bidco and Blackstone)
James Macey White / Ed
Cropley
|
+44 207 260
2700
|
Hipgnosis
Robert Naylor, Chairman via Singer Capital
Markets
|
+44 207 496 3000
|
Singer Capital
Markets (Sole Rule 3 Adviser, Financial Adviser and
Corporate Broker to Hipgnosis)
James Moat / Alaina Wong / Sam Butcher / Jalini
Kalaravy
|
+44 207 496 3000
|
Shot Tower
Capital LLC (Valuer and Strategic Adviser to
Hipgnosis)
David Dunn / Robert Law / Rick Roebuck / Will
Ponsi
|
+1 410 376 7900
|
Headland
Consultancy (PR Adviser to Hipgnosis)
Susanna Voyle / Charlie Twigg
|
+44 203 805 4822
|
|
|
Kirkland & Ellis International LLP is
acting as legal adviser to Bidco and Blackstone in connection with
the Acquisition. Ogier (Guernsey) LLP is acting as Guernsey legal
adviser to Bidco.
Shoosmiths LLP is acting as UK legal adviser in
connection with the Acquisition. Carey Olsen (Guernsey) LLP is
acting as Guernsey legal adviser to Hipgnosis.
Further information
Jefferies
International Limited ("Jefferies"), which is authorised and
regulated in the UK by the FCA, is acting as financial adviser to
Blackstone and Bidco and no one else in connection with the matters
described in this announcement and will not be responsible to
anyone other than Blackstone and Bidco for providing the
protections offered to clients of Jefferies or for providing advice
in connection with any matter referred to in this announcement.
Neither Jefferies nor any of its affiliates (nor their respective
directors, officers, employees or agents) 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 Jefferies in connection with this
announcement, any statement contained herein, the Offer or
otherwise. No representation or warranty, express or implied, is
made by Jefferies as to the contents of this
announcement.
Singer
Capital Markets Advisory LLP ("Singer Capital Markets"), which is
authorised and regulated in the United Kingdom by the FCA, is
acting as sole Rule 3 adviser, financial adviser and corporate
broker exclusively for Hipgnosis and no one else in connection with
the matters described in this announcement and will not be
responsible to anyone other than Hipgnosis for providing the
protections afforded to clients of Singer Capital Markets nor for
providing advice in connection with the matters referred to
herein.
This
announcement is for information purposes only and is not intended
to, and does not, constitute, or form part of,
an 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 the Acquisition or otherwise, nor shall there be any sale,
issuance or transfer of securities of Hipgnosis in any jurisdiction
in contravention of applicable law. The Acquisition will be
implemented solely pursuant to the terms of the Offer Document (or,
if the Acquisition is implemented by way of a Scheme, the Scheme
Document), which will contain the full terms and conditions of the
Acquisition, including details of how to vote in respect of the
Acquisition. Any response in relation to the Acquisition, or
if the Acquisition is implemented by way of a Scheme, any vote in
respect of the Scheme should be made only on the basis of the
information contained in the Offer Document (or, if the Acquisition
is implemented by way of a Scheme, the Scheme
Document).
This
announcement does not constitute a prospectus, prospectus
equivalent document or exempted document.
This
announcement contains inside information in relation to Hipgnosis
for the purposes of Article 7 of the Market Abuse Regulation.
Hipgnosis' Legal Entity Identifier is
213800XJIPNDVKXMOC11.
If
you are in any doubt about the contents of this announcement or the
action you should take, you are recommended to seek your own
independent financial advice immediately from your stockbroker,
bank manager, solicitor, accountant or independent financial
adviser duly authorised under the Financial Services and Markets
Act 2000 (as amended) if you are resident in the United Kingdom or,
if not, from another appropriately authorised independent financial
adviser.
Overseas
shareholders
The release,
publication or distribution of this announcement in or into
jurisdictions other than the UK may be restricted by law and
therefore any persons who are subject to the law of any
jurisdiction other than the UK should inform themselves of, and
observe, any applicable legal or regulatory requirements. Any
failure to comply with such requirements may constitute a violation
of the securities laws of any such jurisdiction. To the
fullest extent permitted by applicable law, the companies and
persons involved in the Acquisition disclaim any responsibility or
liability for the violation of such restrictions by any person.
This announcement has been prepared in accordance with and for the
purpose of complying with English law, Guernsey law, the Takeover
Code, the Market Abuse Regulation and the Disclosure Guidance and
Transparency Rules and information disclosed may not be the same as
that which would have been prepared in accordance with the laws of
jurisdictions outside England.
The
availability of the Acquisition to Hipgnosis Shareholders who are
not resident in and citizens of the UK may be affected by the laws
of the relevant jurisdictions in which they are located or of which
they are citizens. Persons who are not resident in the UK
should inform themselves of, and observe, any applicable legal or
regulatory requirements of their jurisdictions. Any failure
to comply with the applicable restrictions may constitute a
violation of the securities laws of any such jurisdiction. To
the fullest extent permitted by applicable law, the companies and
persons involved in the Acquisition disclaim any responsibility or
liability for the violation of such restrictions by any
person. Further details in relation to Overseas Shareholders
will be contained in the Offer Document (or, if the Acquisition is
implemented by way of a Scheme, the Scheme
Document).
Unless
otherwise determined by Bidco or required by the Takeover Code, and
permitted by applicable law and regulation, the Acquisition will
not be made available, in whole or in part, directly or indirectly,
in, into or from a Restricted Jurisdiction where to do so would
violate the laws in that jurisdiction and no person may vote in
favour of the Acquisition by any such use, means, instrumentality
or from within a Restricted Jurisdiction or any other jurisdiction
if to do so would constitute a violation of the laws of that
jurisdiction. Copies of this announcement and any formal
documentation relating to the Acquisition are not being, and must
not be, directly or indirectly, mailed or otherwise forwarded,
distributed or sent in or into or from any Restricted Jurisdiction
and persons receiving such documents (including, without
limitation, agents, custodians, nominees and trustees) must not
mail or otherwise forward, distribute or send it in or into or from
any Restricted Jurisdiction. Doing so may render invalid any
related purported vote in respect of the Acquisition. Unless
otherwise permitted by applicable law and regulation, the Offer may
not be made directly or indirectly, in or into, or by the use of
mails or any means or instrumentality (including, but not limited
to, facsimile, e-mail or other electronic transmission, telex or
telephone) of interstate or foreign commerce of, or of any facility
of a national, state or other securities exchange of any Restricted
Jurisdiction and the Offer may not be capable of acceptance by any
such use, means, instrumentality or facilities.
Further
details in relation to Overseas Shareholders will be included in
the Offer Document (or, if the Acquisition is implemented by way of
a Scheme, the Scheme Document).
Notice to U.S.
Hipgnosis Shareholders
The
Acquisition relates to the shares of a Guernsey company with a
listing on the London Stock Exchange and is being made by means of
takeover offer. A transaction effected by means of a takeover offer
or, if the Acquisition is to be implemented by means of a Scheme, a
scheme of arrangement is not subject to the tender offer or proxy
solicitation rules under the U.S. Securities Exchange
Act of 1934
(the "U.S. Exchange
Act"). Accordingly, the Acquisition is subject to the
disclosure requirements and practices applicable in Guernsey to
takeover offers and schemes of arrangement which differ from the
disclosure requirements of the U.S. tender offer and proxy
solicitation rules. The financial information included in this
announcement has been prepared in accordance with generally
accepted accounting principles of the UK and thus may not be
comparable to financial information of U.S. companies or companies
whose financial statements are prepared in accordance with
generally accepted accounting principles in the United
States.
If, in the
future, Bidco exercises its right to implement the Acquisition by
way of an Offer, which is to be made into the United
States, such
Offer will be
made in compliance with the applicable U.S. laws and
regulations.
It may be
difficult for U.S. holders of Hipgnosis Shares to enforce their
rights and any claim arising out of the U.S. federal laws, since
Bidco and Hipgnosis are located in a non-U.S. jurisdiction, and
some or all of their officers and directors may be residents of a
non-U.S. jurisdiction. U.S. holders of Hipgnosis Shares may
not be able to sue a non-U.S. company or its officers or directors
in a non-U.S. court for violations of the U.S. securities
laws. Further, it may be difficult to compel a non-U.S.
company and its affiliates to subject themselves to a U.S. court's
judgement.
In accordance
with normal UK practice and pursuant to Rule 14e-5(b) of the U.S.
Exchange Act, Blackstone or its nominees, or their brokers (acting
as agents), may from time to time make certain purchases of, or
arrangements to purchase, Hipgnosis Shares outside of the U.S.,
other than pursuant to the Acquisition, until the date on which
completion of the Acquisition occurs, lapses or is otherwise
withdrawn. Also, in accordance with Rule 14e-5(b) of the U.S.
Exchange Act, Jefferies will continue to act as an exempt principal
trader in Hipgnosis shares on the London Stock Exchange.
These purchases may occur either in the open market at prevailing
prices or in private transactions at negotiated prices. Any
information about such purchases will be disclosed as required in
the United Kingdom, will be reported to a Regulatory Information
Service and will be available on the London Stock Exchange
website,
www.londonstockexchange.com.
U.S.
Hipgnosis Shareholders also should be aware that the transaction
contemplated herein may have tax consequences in the U.S. and, that
such consequences, if any, are not described herein. U.S.
Hipgnosis Shareholders are urged to consult with legal, tax and
financial advisers in connection with making a decision regarding
this transaction.
Forward looking statements
This
announcement (including information incorporated by reference in
this announcement), statements made regarding the Acquisition, and
other information published by Bidco and Hipgnosis contain
statements which are, or may be deemed to be, "forward-looking
statements". Forward-looking statements are prospective in
nature and are not based on historical facts, but rather on current
expectations and projections of the management of Bidco and
Hipgnosis about future events and are therefore subject to risks
and uncertainties which could cause actual results to differ
materially from the future results expressed or implied by the
forward-looking statements.
The
forward-looking statements contained in this announcement include
statements relating to the expected effects of the Acquisition on
Bidco and Hipgnosis (including their future prospects, developments
and strategies), the expected timing and scope of the Acquisition
and other statements other than historical facts. Often, but
not always, forward-looking statements can be identified by the use
of forward-looking words such as "prepares", "plans", "expects" or
"does not expect", "is expected", "is subject to", "budget",
"projects", "synergy", "strategy", "scheduled", "goal",
"estimates", "forecasts", "cost-saving", "intends", "target",
"aims", "anticipates", "continues", or "does not anticipate", or
"believes", or variations of such words and phrases or statements
that certain actions, events or results "may", "could", "should",
"would", "might" or "will" be taken, occur or be achieved.
Forward looking statements may include statements relating to
the following: (i) future capital expenditures, expenses, revenues,
earnings, synergies, economic performance, indebtedness, financial
condition, dividend policy, losses and future prospects; (ii)
business and management strategies and the expansion and growth of
Bidco's, Hipgnosis', any member of the Bidco Group's or any member
of the Hipgnosis Group's operations and potential synergies
resulting from the Acquisition; and (iii) the effects of global
economic conditions and governmental regulation on Bidco's,
Hipgnosis', any member of the Bidco Group's or any member of the
Hipgnosis Group's business.
Although
Bidco and Hipgnosis believe that the expectations reflected in such
forward-looking statements are reasonable, Bidco and Hipgnosis can
give no assurance that such expectations will prove to be
correct. By their nature, forward-looking statements involve
risk and uncertainty because they relate to events and depend on
circumstances that will occur in the future. There are a
number of factors that could cause actual results and developments
to differ materially from those expressed or implied by such
forward-looking statements.
These factors
include, but are not limited to: the ability to complete the
Acquisition; the ability to obtain requisite regulatory and
shareholder approvals and the satisfaction of other Conditions on
the proposed terms and schedule; changes in the global political,
economic, business and competitive environments and in market and
regulatory forces; changes in future exchange and interest rates;
changes in tax rates; future business combinations or disposals;
changes in general economic and business conditions; changes in the
behaviour of other market participants; changes in the anticipated
benefits from the Acquisition not being realised as a result of
changes in general economic and market conditions in the countries
in which Bidco and Hipgnosis operate, weak, volatile or illiquid
capital and/or credit markets, changes in tax rates, interest rate
and currency value fluctuations, the degree of competition in the
geographic and business areas in which Bidco and Hipgnosis operate
and changes in laws or in supervisory expectations or requirements.
Other unknown or unpredictable factors could cause actual results
to differ materially from those expected, estimated or projected in
the forward-looking statements. If any one or more of these
risks or uncertainties materialises or if any one or more of the
assumptions proves incorrect, actual results may differ materially
from those expected, estimated or projected. Such forward-looking
statements should therefore be construed in the light of such
factors. Neither Bidco nor Hipgnosis, nor any of their
respective associates or directors, officers or advisers, provides
any representation, assurance or guarantee that the occurrence of
the events expressed or implied in any forward-looking statements
in this announcement will actually occur. You are cautioned
not to place any reliance on these forward-looking
statements.
Specifically,
statements of estimated cost savings and synergies related to
future actions and circumstances which, by their nature, involve
risks, uncertainties and contingencies. As a result, the cost
savings and synergies referred to may not be achieved, may be
achieved later or sooner than estimated, or those achieved could be
materially different from those estimated. Due to the scale of the
Hipgnosis Group, there may be additional changes to the Hipgnosis
Group's operations. As a result, and given the fact that the
changes relate to the future, the resulting cost synergies may be
materially greater or less than those estimated.
Other than in
accordance with their legal or regulatory obligations, neither
Bidco nor Hipgnosis is under any obligation, and Bidco and
Hipgnosis expressly disclaim any intention or obligation, to update
or revise any forward-looking statements, whether as a result of
new information, future events or otherwise.
Dealing and opening position disclosure
requirements
Under Rule 8.3(a) of the Takeover Code, any person who is
interested in 1% or more of any class of relevant securities of an
offeree company or of any securities exchange offeror (being any
offeror other than an offeror in respect of which it has been
announced that its offer is, or is likely to be, solely in cash)
must make an Opening Position Disclosure following the commencement
of the offer period and, if later, following the announcement in
which any securities exchange offeror is first identified. An
Opening Position Disclosure must contain details of the person's
interests and short positions in, and rights to subscribe for, any
relevant securities of each of (i) the offeree company and (ii) any
securities exchange offeror(s). An Opening Position Disclosure by a
person to whom Rule 8.3(a) of the Takeover Code applies must be
made by no later than 3.30 pm (London time) on the 10th business
day following the commencement of the offer period and, if
appropriate, by no later than 3.30 pm (London time) on the 10th
business day following the announcement in which any securities
exchange offeror is first identified. Relevant persons who deal in
the relevant securities of the offeree company or of a securities
exchange offeror prior to the deadline for making an Opening
Position Disclosure must instead make a Dealing
Disclosure.
Under Rule 8.3(b) of the Takeover Code, any person who is, or
becomes, interested in 1% or more of any class of relevant
securities of the offeree company or of any securities exchange
offeror must make a Dealing Disclosure if the person deals in any
relevant securities of the offeree company or of any securities
exchange offeror. A Dealing Disclosure must contain details of the
dealing concerned and of the person's interests and short positions
in, and rights to subscribe for, any relevant securities of each of
(i) the offeree company and (ii) any securities exchange
offeror(s), save to the extent that these details have previously
been disclosed under Rule 8. A Dealing Disclosure by a person to
whom Rule 8.3(b) applies must be made by no later than 3.30 pm
(London time) on the business day following the date of the
relevant dealing.
If
two or more persons act together pursuant to an agreement or
understanding, whether formal or informal, to acquire or control an
interest in relevant securities of an offeree company or a
securities exchange offeror, they will be deemed to be a single
person for the purpose of Rule 8.3.
Opening Position Disclosures must also be made by the offeree
company and by any offeror and Dealing Disclosures must also be
made by the offeree company, by any offeror and by any persons
acting in concert with any of them (see Rules 8.1, 8.2 and
8.4).
Details of the offeree and offeror companies in respect of
whose relevant securities Opening Position Disclosures and Dealing
Disclosures must be made can be found in the Disclosure Table on
the Takeover Panel's website at www.thetakeoverpanel.org.uk,
including details of the number of relevant securities in issue,
when the offer period commenced and when any offeror was first
identified. You should contact the Panel's Market Surveillance Unit
on +44 (0)20 7638 0129 if you are in any doubt as to whether you
are required to make an Opening Position Disclosure or a Dealing
Disclosure.
Publication on
a website
In accordance
with Rule 26.1 of the Takeover Code, a copy of this announcement
and the documents required to be published under Rule 26 of the
Takeover Code will be made available, subject to certain
restrictions relating to persons resident in Restricted
Jurisdictions, on Hipgnosis' website at
https://communications.singercm.com/p/4UWI-EVY/blackstone-recommended-offer-hipgnosis
and on Bidco's website at
https://www.announcement-documents.com/
by no later than 12 noon (London
time) on the Business Day following this announcement. For
the avoidance of doubt, neither the content of this website nor of
any website accessible from any hyperlinks set out in this
announcement are incorporated by reference or form part of this
announcement.
No profit forecasts, estimates or quantified benefits
statements
No statement
in this announcement is intended as a profit forecast, profit
estimate or quantified benefits statement for any period and no
statement in this announcement should be interpreted to mean that
earnings or earnings per share for Hipgnosis for the current or
future financial years would necessarily match or exceed the
historical published earnings or earnings per share for
Hipgnosis.
General
Bidco
reserves the right to elect to implement the Acquisition by way of
a Scheme as an alternative to the Scheme, subject to the Panel's
consent and (while the Cooperation Agreement is continuing) to the
terms of the Cooperation Agreement. In such event, such
Scheme will be implemented on substantially the same terms and
conditions so far as applicable, as those which would apply to the
Offer (subject to appropriate amendments, and for so long as the
Cooperation Agreement is continuing and the Scheme arises in
accordance with the terms of the Cooperation
Agreement).
Investors
should be aware that Bidco may purchase Hipgnosis Shares otherwise
than under any Offer or the Scheme, including pursuant to privately
negotiated purchases.
Requesting hard copy documents
In accordance
with Rule 30.3 of the Takeover Code, Hipgnosis Shareholders and
persons with information rights may request a hard copy of this
announcement by contacting Hipgnosis' registrars, Computershare
Investor Services (Guernsey) Limited, or by calling 0370 707 4040
or from overseas +44 370 707 4040. Calls are charged at the
standard geographical rate and will vary by provider. Calls outside
the United Kingdom or Guernsey will be charged at the applicable
international rate. Lines are open between 8.30 a.m. to 5.30 p.m.
(London time), Monday to Friday (except public holidays in the UK
and Guernsey). Please note that Computershare Investor Services
(Guernsey) Limited cannot provide any financial, legal or tax
advice. Calls may be recorded and monitored for security and
training purposes. For persons who receive a copy of this
announcement in electronic form or via a website notification, a
hard copy of this announcement will not be sent unless so
requested. Such persons may also request that all future documents,
announcements and information to be sent to them in relation to the
Acquisition should be in hard copy form.
Electronic communications
Please be
aware that addresses, electronic addresses and certain other
information provided by Hipgnosis Shareholders, persons with
information rights and other relevant persons for the receipt of
communications from Hipgnosis may be provided to Bidco during the
offer period as required under Section 4 of Appendix 4 of the
Takeover Code to comply with Rule 2.11(c) of the Takeover
Code.
Rounding
Certain
figures included in this announcement have been subjected to
rounding adjustments. Accordingly, figures shown for the same
category presented in different tables may vary slightly and
figures shown as totals in certain tables may not be an arithmetic
aggregation of figures that precede them.
Disclaimer
The Acquisition will be subject to English law, the
jurisdiction of the Court, and the applicable requirements of the
GFSC, the Companies Law, the Takeover Code, the Panel and the
London Stock Exchange.
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
THAT JURISDICTION
FOR IMMEDIATE
RELEASE
THIS
ANNOUNCEMENT CONTAINS INSIDE INFORMATION
29 April 2024
RECOMMENDED CASH
ACQUISITION
of
HIPGNOSIS SONGS FUND
LIMITED
by
LYRA BIDCO LIMITED
(a newly-formed company indirectly
wholly-owned by investment funds advised by affiliates of
Blackstone Inc.)
to be implemented by means of a takeover
offer for the purposes of section 337 of the Companies (Guernsey)
Law, 2008 (as amended)
1
Introduction
The boards of directors of Bidco and Hipgnosis
are pleased to announce that they have reached agreement on the
terms and conditions of a recommended cash acquisition by Bidco of
for the entire issued, and to be issued, ordinary share capital of
Hipgnosis.
It is intended that the Acquisition will be
implemented by way of a takeover offer for the purposes of section
337 of the Companies Law (although Bidco reserves the right to
effect the Acquisition by way of a Scheme, subject to the consent
of the Panel and the terms of the Cooperation Agreement). The
Conditions to the Acquisition are set out in full in Appendix 1 to
this announcement.
2
The Acquisition
Under the terms of the
Acquisition, which will be subject to the
Conditions and further terms set out in Appendix 1 to this
announcement and the full terms and conditions to be set out in the
Offer Document, each Hipgnosis Shareholder will be entitled to
receive:
for each Hipgnosis Share:
$1.30
in cash
The GBP equivalent value of the Acquisition
Price based on the Announcement Exchange Rate, being 104 pence,
represents a premium of approximately:
· 4.0 per
cent. to the implied offer price of the Concord Revised Offer;
· 48.1 per
cent. to the Closing Price of 71 pence per Hipgnosis Share on 17
April 2024 (being the last Business Day before the commencement of
the Offer Period);
· 53.6 per
cent. to the volume-weighted average price of 68 pence per
Hipgnosis Share for the one-month period ended 17 April 2024 (being
the last Business Day before the commencement of the Offer
Period);
· 58.1 per
cent. to the volume-weighted average price of 66 pence per
Hipgnosis Share for the three-month period ended 17 April 2024
(being the last Business Day before the commencement of the Offer
Period);
· 16.9 per
cent. to Hipgnosis' Adjusted 30 September 2023 Operative NAV per
Hipgnosis Share of $1.11.
The Acquisition values Hipgnosis' entire issued, and
to be issued, ordinary share capital at approximately $1,572
million (which is equivalent to £1,262 million based on the
Announcement Exchange Rate).
Bidco will procure that a facility will be made
available under which Hipgnosis Shareholders will be able to elect
(subject to the terms and conditions of the facility) to receive
the cash consideration in Sterling (after deduction of any
transaction or dealing costs associated with the conversion) at the
applicable market exchange rate on the latest practicable date for
fixing such rate prior to the relevant payment date. Further
details of this facility and the election by Hipgnosis Shareholders
wishing to receive their cash consideration in Sterling will be set
out in the Offer Document and the Form of Election. On the basis of
the Announcement Exchange Rate, the cash consideration implies an
equivalent value of 104 pence per
Hipgnosis Share. For any Hipgnosis Shareholder electing to be paid
their cash consideration in Sterling, the amount per Hipgnosis
Share received may, depending on the prevailing exchange rate,
result in a payment below or above 104
pence per Hipgnosis Share.
The Hipgnosis Shares will be acquired pursuant
to the Acquisition fully paid and free from all liens, charges,
equities, encumbrances, rights of
pre‑emption and any other interests of any nature whatsoever and
together with all rights attaching thereto, including without
limitation voting rights and the right to receive and retain in
full all dividends and other distributions (if any) announced,
declared, made or paid with a record date on or after the date of
this announcement.
An updated valuation report will be produced
for the purposes of the Offer Document and will be reproduced in
the Offer Document.
If, on or after the date of this announcement
and prior to completion of the Acquisition, any dividend and/or
other distribution is announced, declared, made or paid or becomes
payable in respect of the Hipgnosis Shares with a record date prior
to completion of the Acquisition, Bidco reserves the right to
reduce the consideration payable under the terms of the Acquisition
for the Hipgnosis Shares by an amount up to the aggregate amount of
such dividend and/or distribution, in which case any reference in
this announcement to the consideration payable under the terms of
the Acquisition will be deemed to be a reference to the
consideration as so reduced. Any exercise by Bidco of its rights
referred to in this paragraph shall be the subject of an
announcement and, for the avoidance of doubt, shall not be regarded
as constituting any revision or variation of the terms of the Offer
or the Acquisition. In such circumstances, Hipgnosis Shareholders
would be entitled to retain any such dividend or distribution
declared, made or paid.
3
Background to and reasons for the Acquisition
Blackstone's history of investments covers a
wide range of sectors and business structures that all have in
common a focus to build and grow the businesses in which it
invests. Blackstone has a particularly strong focus on the media
and entertainment sectors, covering music rights as well as the
broader universe of asset-backed strategies. Among its investments
within the media and entertainment sectors, through its portfolio
company Hipgnosis Songs Assets, managed by Hipgnosis Song
Management Limited ("HSM"
or the "Investment
Adviser") which is majority owned by Blackstone, Blackstone
owns music rights catalogues from leading artists and songwriters.
Blackstone's other investments in the space include SESAC, the US
performance rights society and Candle Media.
Blackstone continues to invest thematically in
content across the wider entertainment industry. Blackstone has
closely tracked the performance of Hipgnosis and has been a long
term admirer of the music rights catalogues owned by Hipgnosis.
Blackstone will seek to further enhance the value of the acquired
rights in collaboration with the songwriters, artists and producers
who entrusted Hipgnosis to safeguard their legacy.
Blackstone has worked collaboratively with the
Hipgnosis Board to ensure that its offer represents a fair and
reasonable outcome for all shareholders.
4
Recommendation
In light of the terms of the Acquisition as
compared to the Concord Revised Offer, the Hipgnosis Directors, who
have been so advised by Singer Capital Markets as to the financial
terms of the Acquisition, unanimously consider the terms of the
Acquisition to be fair and reasonable. In providing its advice to
the Hipgnosis Directors, Singer Capital Markets has taken into
account the commercial assessments of the Hipgnosis Directors.
Singer Capital Markets is providing independent financial advice to
the Hipgnosis Directors for the purposes of Rule 3 of the Takeover
Code.
Accordingly,
the Hipgnosis Directors intend to recommend unanimously that
Hipgnosis Shareholders should accept or procure the acceptance of
the Offer, or (in the event that the Acquisition is implemented by
way of a Scheme), to vote in favour of the Scheme at the requisite
Court Meeting and the Resolutions at a General Meeting of Hipgnosis
Shareholders.
Given their
intended recommendation of the terms of the Acquisition, the
Hipgnosis Directors have decided unanimously to withdraw their
recommendation of the Concord Revised Offer.
5
Background to and reasons for the recommendation
On 18 April 2024, the boards of Hipgnosis and
Concord announced that they had reached agreement on the terms and
conditions of a recommended cash offer pursuant to which Concord
would acquire the entire issued and to be issued share capital of
Hipgnosis to be effected by means of a Scheme between Hipgnosis and
relevant Hipgnosis Shareholders at a price per Hipgnosis Share of
$1.16 with a further contingent consideration of up to $25 million,
$0.020 per Hipgnosis Share.
On 20 April 2024, Blackstone announced a
possible offer for the entire issued and to be issued share capital
of Hipgnosis at a price of $1.24 per Hipgnosis Share and that it
was intended that any firm offer made under Rule 2.7 of the
Takeover Code in relation to the possible offer would be effected
by means of an Offer.
On 24 April 2024, the boards of Hipgnosis and
Concord announced that they had reached agreement on the terms and
conditions of an increased recommended cash offer pursuant to which
Concord would acquire the entire issued and to be issued share
capital of Hipgnosis, to be effected by means of a Scheme between
Hipgnosis and relevant Hipgnosis Shareholders, at a price of $1.25
per Hipgnosis Share (the "Concord
Revised Offer").
Under the terms of the Acquisition from Bidco
announced today, each Hipgnosis shareholder would receive $1.30 per
Hipgnosis Share, representing a premium of $0.05 per Hipgnosis
Share (4.0 per cent.) compared to the
Concord Revised Offer. The Hipgnosis Board has concluded, after
careful consideration, that the Acquisition represents a superior
offer for Hipgnosis Shareholders as compared with the Concord
Revised Offer.
Accordingly, the Hipgnosis Board has decided to
withdraw its recommendation for the Concord Revised Offer and
intends to unanimously recommend that Hipgnosis Shareholders accept
or procure the acceptance of the Acquisition, or (in the event that
the Acquisition is implemented by way of a Scheme), to vote in
favour of the Scheme at the requisite Court Meeting and the
Resolutions at a General Meeting of Hipgnosis
Shareholders.
6
Information relating to Bidco and Blackstone
Bidco
Bidco is a private limited company incorporated
under the laws of England and Wales on 25 April 2024, whose
registered office is at 40 Berkeley Square, London, W1J 5AL, United
Kingdom with registered number 15680043. Bidco is a newly-formed
company indirectly wholly-owned by investment funds advised by
affiliates of Blackstone. Bidco was formed for the purposes of the
Acquisition and has not traded since its date of incorporation, nor
has it entered into any obligations other than in connection with
the Acquisition.
The current directors of Bidco are Qasim Abbas
and Henry Tian. Further details in relation to Bidco will be
contained in the Offer Document.
Blackstone
Blackstone is one of the world's leading
investment firms. Blackstone seeks to create positive economic
impact and long-term value for our investors, the companies we
invest in and the communities in which we work. Blackstone does
this by using extraordinary people and flexible capital to help
companies solve problems. Blackstone's $1 trillion in assets under
management as at 31 December 2023 include investment vehicles
focused on private equity, real estate, public debt and equity,
life sciences, growth equity, opportunistic, non-investment grade
credit, real assets and secondary funds, all on a global basis.
Further information is available at www.blackstone.com.
7
Information relating to Hipgnosis
Hipgnosis was launched in 2018 to offer
investors a pure-play exposure to music royalties and their
associated intellectual property rights with a focus on building a
diversified portfolio, acquiring catalogues that are built around
proven hit songs by some of the most talented and important
songwriters globally.
Since launch, Hipgnosis has built a portfolio
currently comprising 138 catalogues with more than 40,000 songs,
containing copyright and income streams derived from compositions
performed by some of the top artists of the last 50 years.
Hipgnosis' portfolio is diversified across genres, artists,
vintages and right types.
Hipgnosis is a non-cellular Guernsey company
registered with the GFSC as a closed-ended collective investment
scheme whose ordinary shares are admitted to the Premium Listing
Segment of the FCA's Official List and admitted to trading on the
Main Market of the London Stock Exchange. It is a self-managed AIF
under the EU AIFM Directive and the UK AIFMD.
8
Financing of the Acquisition
The cash consideration payable to Hipgnosis
Shareholders under the terms of the Acquisition will be financed by
an equity investment into Bidco from the Blackstone
Funds.
Jefferies, in its capacity as financial adviser
to Bidco, is satisfied that
sufficient resources are available to Bidco to
satisfy in full the cash consideration payable to Hipgnosis
Shareholders under the terms of the Acquisition.
Further information on the financing of the
Acquisition will be set out in the Offer Document.
9
Offer‑related arrangements
Confidentiality Agreement
On 11 April 2024, Blackstone, on behalf of
Bidco, and Hipgnosis entered into a Confidentiality Agreement in
relation to the Acquisition, pursuant to
which, amongst other things, Blackstone, on behalf of Bidco has
undertaken to: (i) subject to certain exceptions, keep information
relating to Hipgnosis and the Acquisition confidential and not to
disclose it to third parties; and (ii) use such confidential
information only in connection with the Acquisition. These
confidentiality obligations will remain in force until the earlier
of: (i) the date on which Hipgnosis and Blackstone enter into any
written and legally binding agreement or agreements in relation to
the Acquisition; and (ii) 11 April 2026.
Cooperation Agreement
Pursuant to the Cooperation Agreement, Bidco
and Hipgnosis have, amongst other things, each agreed to cooperate
in preparing and implementing appropriate proposals in relation to
the Acquisition. In addition, Hipgnosis has agreed that Bidco
may elect to implement the Acquisition by means of a Scheme, in the
event of which Bidco has agreed to certain provisions if the Offer
should switch to a Scheme. The Cooperation Agreement will
terminate in certain circumstances, including if the Acquisition is
withdrawn, terminated or lapses, a third party announces a possible
or firm intention to make an offer for Hipgnosis which completes,
becomes effective or becomes unconditional, or if prior to the Long
Stop Date any Condition has been invoked by Bidco (with the consent
of the Panel), if the Hipgnosis Directors withdraw their
recommendation of the Acquisition or if completion of the
Acquisition does not occur in accordance with its terms by the Long
Stop Date or otherwise as agreed between Bidco and Hipgnosis.
Pursuant to the terms of the Cooperation Agreement, Bidco
undertakes that it will inform Hipgnosis confirming if, to the
extent permitted by the Panel, it intends to invoke or treat as
unsatisfied or incapable of satisfaction one or more
Conditions.
10
Disclosure of interests in Hipgnosis securities
As at 26 April 2024
(being the last practicable date prior to the date of this
announcement) neither Bidco, nor any of its directors, nor, so far
as Bidco is aware, any person treated as acting in concert (within
the meaning of the Takeover Code) with it for the purposes of the
Acquisition: (i) had any interest in or right to subscribe for or
had borrowed or lent any Hipgnosis Shares or securities convertible
or exchangeable into Hipgnosis Shares; or (ii) had any short
positions in respect of relevant securities of Hipgnosis (whether
conditional or absolute and whether in the money or otherwise),
including any short position under a derivative, any agreement to
sell or any delivery obligation or right to require another person
to purchase or take delivery; or (iii) has borrowed or lent any
relevant securities of Hipgnosis (including, for these purposes,
any financial collateral arrangements of the kind referred to in
Note 3 on Rule 4.6 of the Takeover Code) save for any borrowed
shares which have been either on-lent or resold; or (iv) is a party
to any dealing arrangement of the kind referred to in Note 11 on
the definition of acting in concert in the Takeover
Code.
HSM provides investment advisory services to
Hipgnosis and certain of its subsidiaries pursuant to the
Investment Advisory Agreement.
It has not been practicable for Bidco to make
enquiries of all of its concert parties in advance of the release
of this announcement. Therefore, if Bidco becomes aware, following
the making of such enquiries, that any of its concert parties have
any additional interests in the relevant securities of Hipgnosis,
all relevant details in respect of Bidco's concert parties will be
included in Bidco's Opening Position Disclosure in accordance with
Rule 8.1(a) and Note 2(a)(i) on Rule 8 of the Takeover Code which
must be made on or before 12 noon (London time) on 3
May 2024.
11
Directors, management, employees, pensions, research and
development and locations
Bidco's strategic plans for
Hipgnosis
As set out in paragraph 3
above, Bidco recognises the quality and strength of the music
rights catalogues Hipgnosis has acquired and developed, which are
complementary to Blackstone's current holdings of comparable
assets. The Bidco Board believes that the Acquisition provides an
exciting path forward to continue building on Blackstone's existing
interests and to utilise Blackstone's expertise in this space to
further develop the potential of Hipgnosis' portfolio.
Following completion of the Acquisition, and
subject to the strategic evaluation described below, Bidco's
primary intention is that the Hipgnosis Group will be integrated
with Blackstone's existing music rights investment portfolio
company, Hipgnosis Songs Assets, but Blackstone may continue to
hold Hipgnosis as a standalone investment depending on the outcome
of such strategic evaluation. In addition, it is expected that,
following completion of the Acquisition, Bidco will undertake an
internal group reorganisation of the Hipgnosis Group to simplify
the corporate structure.
Following completion of the Acquisition, Bidco
intends to build on its confirmatory due diligence exercise and
continue to work with HSM to formulate a detailed strategy for the
Hipgnosis Group and its business as well as its locations of
business. This will include determining the basis of any internal
group reorganisation to rationalise the corporate structure of the
Hipgnosis Group in light of the significant number of subsidiary
entities within the Hipgnosis Group as the corollary of a series of
acquisitions of holding companies in the process of growing the
Hipgnosis Group's portfolio of song rights. This strategic
evaluation will also include formulation of Bidco's strategy for
Hipgnosis' US songs administration business, Hipgnosis Songs Group
LLC ("HSG"), which is the
only entity within the Hipgnosis Group that has employees. The
assessment for HSG will contemplate continuing to hold the
business, making a disposal (or disposals) in respect of the
business, and/or a restructuring of the business. Bidco has no
intention to reduce headcount in the Hipgnosis Group, however in
the event that Bidco pursues a restructuring of HSG, this could
result in a headcount reduction at HSG. Bidco expects that the
necessary evaluation to finalise its strategy for Hipgnosis will be
completed within approximately six to nine months from the
completion of the Acquisition.
The
Investment Adviser, employees and management
Bidco attaches great importance to the skill
and experience of HSM's management and employees and recognises the
contributions they have made to the development of the Hipgnosis
portfolio and the business. It is therefore anticipated that HSM
will continue to be involved in managing the assets owned by
Hipgnosis.
The asset management relationship between
Hipgnosis and HSM will be reconfigured to take into account
Hipgnosis' post-acquisition status in private ownership and / or to
reflect the potential combination with the assets of Hipgnosis
Songs Assets described above.
Existing employment rights and
pensions
Hipgnosis currently employs 34 employees, all
of which are employed by HSG, and offers a 401k plan to employees
of the Hipgnosis Group. Hipgnosis does not operate a defined
benefit pension plan. Subject to the outcome of the strategic
evaluation and the ultimate course of action to be implemented
regarding HSG, Bidco has no intentions to reduce headcount of the
Hipgnosis Group. Upon and following completion of the Acquisition,
Bidco intends to align the conditions of employment of Hipgnosis'
management with those in place in respect of other Blackstone
portfolio companies and confirms that it intends to safeguard fully
the existing contractual and statutory employment rights of all
Hipgnosis Group employees.
It is intended that, with effect from
completion of the Acquisition, each of the non-executive members of
the Hipgnosis Board shall resign from their office as a director of
Hipgnosis.
Management incentive
arrangements
Bidco has not entered into, and has not had
discussions on proposals to enter into, any form of incentivisation
arrangements with any Hipgnosis Group employees.
Headquarters, locations, fixed assets
and research and development
Subject to the outcome of the strategic review,
Bidco does not currently have any intention to terminate the leases
on any of the Hipgnosis Group premises in Tennessee, California,
New York or its registered office in London.
Other than its registered office, Hipgnosis has
no fixed place of business, fixed assets (other than those held in
its music catalogues and other investments), research and
development function or headquarters or headquarter
functions.
Trading Facilities
The Hipgnosis Shares are currently listed on
the Premium Segment of the Official List and admitted to trading on
the Main Market of the London Stock Exchange. As set out in
paragraph 13, applications will be made for the cancellation of the
listing of the Hipgnosis Shares on the Official List and the
cancellation of trading of Hipgnosis Shares on the London Stock
Exchange.
Financing
Bidco will procure the repayment of Hipgnosis'
existing debt facility arrangements on completion of the
Acquisition.
No
post-offer undertakings
No statements in this paragraph
11 are "post-offer undertakings" for the
purposes of Rule 19.5 of the Takeover Code.
In considering the recommendation
of the Acquisition to Hipgnosis Shareholders, the Hipgnosis
Directors have given due consideration to Bidco's intentions for
Hipgnosis set out above.
12
Offer process
It is intended that the Acquisition is subject
to the Conditions and certain further terms referred to in Appendix
1 to this announcement and to the full terms and conditions to be
set out in the Offer Document (or, if the Acquisition is
implemented by means of a Scheme, the Scheme Document), and that
the Acquisition will only complete if, among other things, the
following events occur on or before the Long Stop Date (or such
later date as the Bidco and Hipgnosis may, with the consent of the
Panel, agree):
· valid
acceptances are received (and not validly withdrawn) by not later
than 1.00 p.m. (London time) on the unconditional date (or such
later time(s) and/or (date(s) as Bidco may, with the consent of the
Panel, decide) in respect of such number of Hipgnosis Shares as
shall, when aggregated with any Hipgnosis Shares acquired or
unconditionally agreed to be acquired (whether pursuant to the
Offer or otherwise) by Bidco, represent Hipgnosis Shares carrying
not less than 55 per cent. of the voting rights then exercisable at
a general meeting of Hipgnosis Shareholders (or such lower
percentage as Bidco may decide), provided that Bidco shall hold or
have acquired or agreed to acquire (whether pursuant to the Offer
or otherwise), directly or indirectly, Hipgnosis Shares carrying in
aggregate more than 50 per cent. of the voting rights then normally
exercisable at a general meeting of Hipgnosis (the "Acceptance Condition").
Unless the Panel agrees otherwise, the Acceptance
Condition shall only be capable of being satisfied when all other
Conditions have been satisfied or waived.
The Condition in paragraph 1 of
Appendix 1 to this
announcement provide that the Offer will lapse
(under the authority of Rule 13.5(b) of the Takeover Code)
if:
· the Offer
does not become and is not declared unconditional
by 11.59 p.m. on the Long Stop Date (or such later date
as Bidco and Hipgnosis may, with the consent of the Panel,
agree).
The Acquisition is currently expected to complete
during the third quarter of 2024, subject to the satisfaction or
(where applicable) waiver of the Conditions. An expected
timetable of key events relating to the Acquisition will be set out
in the Offer Document.
It is expected that the Offer Document, containing
further information about the Acquisition and specifying the
actions to be taken by Hipgnosis Shareholders in respect of the
Offer, will be published (with the accompanying form of acceptance)
as soon as practicable and in any event within 28 days of this
announcement. "Day 60" of the Takeover Code timetable will be the
day falling 60 days after publication of the Offer Document (or
such other date as may be determined by Bidco with the agreement of
the Panel to be the last date for fulfilment of the Acceptance
Condition).
13
Delisting, cancellation of trading and compulsory acquisition
and surrender of fund registration(s)
If the Offer becomes, or is declared,
unconditional and Bidco has received valid acceptances (which have
not been validly withdrawn) in respect of such number of Hipgnosis
Shares as shall, when aggregated with any Hipgnosis Shares acquired
or unconditionally agreed to be acquired (whether pursuant to the
Offer or otherwise) by Bidco, represent Hipgnosis Shares carrying
not less than: (a) in respect of (i) and (ii) below, 75 per cent.;
and (b) in respect of (iii) below, 90 per cent., in each case of
the voting rights then exercisable at a general meeting of
Hipgnosis Shareholders, Bidco intends to (i) make a
request to the FCA to cancel the listing of the Hipgnosis Shares
from the Official List; (ii) make a request to the
London Stock Exchange to cancel the trading of Hipgnosis Shares on
its Main Market; (iii) exercise its rights to apply the provisions
of Part XVIII of the Companies Law so as
to acquire compulsorily the remaining Hipgnosis Shares in respect
of which the Offer has not been accepted; and (iv) surrender
Hipgnosis' registration with the GFSC as a closed ended collective
investment scheme and as a self-managed AIF under the EU AIFM
Directive and the UK AIFMD.
14
Documents
Copies of the following documents will be
available promptly, subject to certain restrictions
relating to persons resident in Restricted
Jurisdictions, on Hipgnosis' website at
https://communications.singercm.com/p/4UWI-EVY/blackstone-recommended-offer-hipgnosis
and on Bidco's website at https://www.announcement-documents.com/
in any event by no later than noon on the Business Day following
this announcement:
· this
announcement;
· the
Confidentiality Agreement;
· the
Cooperation Agreement;
· the
documents entered into for the financing of the Acquisition
referred to in paragraph 8 above; and
· the
consent letters from Jefferies, Singer Capital Markets and Shot
Tower to being named in this announcement.
Neither the content of the website referred to
in this announcement, nor any website accessible from any
hyperlinks set out in this announcement, are incorporated into or
form part of this announcement.
15
General
Bidco reserves the right to elect (with the
consent of the Panel and subject to the terms of the Cooperation
Agreement) to implement the acquisition of the Hipgnosis Shares by
way of a Scheme as an alternative to the Offer. In such event, the
Scheme will be implemented on substantially the same terms, so far
as applicable, as those which would apply to the Offer.
Investors should be aware that Bidco may
purchase Hipgnosis Shares otherwise than under the Offer, including
pursuant to privately negotiated purchases.
The Acquisition will be on the terms and
subject to the conditions set out herein and in Appendix 1,
and to be set out in the Offer Document. The bases and
sources for certain financial information contained in this
announcement are set out in Appendix 2. Certain definitions
and terms used in this announcement are set out in Appendix 3. The
formal Offer Document will be sent to shareholders of Hipgnosis
within 28 days of this announcement (or on such later date as may
be agreed with Hipgnosis and the Panel).
Jefferies (as sole financial adviser to Bidco)
and Singer Capital Markets (as sole financial adviser to Hipgnosis)
have each given and not withdrawn their consent to the publication
of this announcement with the inclusion herein of the references to
their names in the form and context in which they
appear.
This announcement does not constitute an
offer or an invitation to purchase or subscribe
for any securities.
Enquiries
Jefferies (Financial Adviser to
Bidco and Blackstone)
Philip Noblet / Chris Cottrell /
Harry Le May / Stuart Klein
|
+44 207 029
8000
|
Teneo (Financial PR Adviser
to Bidco and Blackstone)
James Macey White / Ed
Cropley
|
+44 207 260
2700
|
Hipgnosis
Robert Naylor, Chairman via Singer Capital
Markets
|
+44 207 496 3000
|
Singer Capital
Markets (Sole Rule 3 Adviser, Financial Adviser and
Corporate Broker to Hipgnosis)
James Moat / Alaina Wong / Sam Butcher / Jalini
Kalaravy
|
+44 207 496 3000
|
Shot Tower
Capital LLC (Valuer and Strategic Adviser to
Hipgnosis)
David Dunn / Robert Law / Rick Roebuck / Will
Ponsi
|
+1 410 376 7900
|
Headland
Consultancy (PR Adviser to Hipgnosis)
Susanna Voyle / Charlie Twigg
|
+44 203 805 4822
|
|
|
Kirkland & Ellis International LLP is
acting as legal adviser to Bidco and Blackstone in connection with
the Acquisition. Ogier (Guernsey) LLP is acting as Guernsey legal
adviser to Bidco.
Shoosmiths LLP is acting as UK legal adviser in
connection with the Acquisition. Carey Olsen (Guernsey) LLP is
acting as Guernsey legal adviser to Hipgnosis.
Further information
Jefferies
International Limited ("Jefferies"), which is authorised and
regulated in the UK by the FCA, is acting as financial adviser to
Blackstone and Bidco and no one else in connection with the matters
described in this announcement and will not be responsible to
anyone other than Blackstone and Bidco for providing the
protections offered to clients of Jefferies or for providing advice
in connection with any matter referred to in this announcement.
Neither Jefferies nor any of its affiliates (nor their respective
directors, officers, employees or agents) 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 Jefferies in connection with this
announcement, any statement contained herein, the Offer or
otherwise. No representation or warranty, express or implied, is
made by Jefferies as to the contents of this
announcement.
Singer
Capital Markets Advisory LLP ("Singer Capital Markets"), which is
authorised and regulated in the United Kingdom by the FCA, is
acting as sole Rule 3 adviser, financial adviser and corporate
broker exclusively for Hipgnosis and no one else in connection with
the matters described in this announcement and will not be
responsible to anyone other than Hipgnosis for providing the
protections afforded to clients of Singer Capital Markets nor for
providing advice in connection with the matters referred to
herein.
This
announcement is for information purposes only and is not intended
to, and does not, constitute, or form part of,
an 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 the Acquisition or otherwise, nor shall there be any sale,
issuance or transfer of securities of Hipgnosis in any jurisdiction
in contravention of applicable law. The Acquisition will be
implemented solely pursuant to the terms of the Offer Document (or,
if the Acquisition is implemented by way of a Scheme, the Scheme
Document), which will contain the full terms and conditions of the
Acquisition, including details of how to vote in respect of the
Acquisition. Any response in relation to the Acquisition, or
if the Acquisition is implemented by way of a Scheme, any vote in
respect of the Scheme should be made only on the basis of the
information contained in the Offer Document (or, if the Acquisition
is implemented by way of a Scheme, the Scheme
Document).
This
announcement does not constitute a prospectus, prospectus
equivalent document or exempted document.
This
announcement contains inside information in relation to Hipgnosis
for the purposes of Article 7 of the Market Abuse Regulation.
Hipgnosis' Legal Entity Identifier is
213800XJIPNDVKXMOC11.
If
you are in any doubt about the contents of this announcement or the
action you should take, you are recommended to seek your own
independent financial advice immediately from your stockbroker,
bank manager, solicitor, accountant or independent financial
adviser duly authorised under the Financial Services and Markets
Act 2000 (as amended) if you are resident in the United Kingdom or,
if not, from another appropriately authorised independent financial
adviser.
Overseas
shareholders
The release,
publication or distribution of this announcement in or into
jurisdictions other than the UK may be restricted by law and
therefore any persons who are subject to the law of any
jurisdiction other than the UK should inform themselves of, and
observe, any applicable legal or regulatory requirements. Any
failure to comply with such requirements may constitute a violation
of the securities laws of any such jurisdiction. To the
fullest extent permitted by applicable law, the companies and
persons involved in the Acquisition disclaim any responsibility or
liability for the violation of such restrictions by any person.
This announcement has been prepared in accordance with and for the
purpose of complying with English law, Guernsey law, the Takeover
Code, the Market Abuse Regulation and the Disclosure Guidance and
Transparency Rules and information disclosed may not be the same as
that which would have been prepared in accordance with the laws of
jurisdictions outside England.
The
availability of the Acquisition to Hipgnosis Shareholders who are
not resident in and citizens of the UK may be affected by the laws
of the relevant jurisdictions in which they are located or of which
they are citizens. Persons who are not resident in the UK
should inform themselves of, and observe, any applicable legal or
regulatory requirements of their jurisdictions. Any failure to
comply with the applicable restrictions may constitute a violation
of the securities laws of any such jurisdiction. To the
fullest extent permitted by applicable law, the companies and
persons involved in the Acquisition disclaim any responsibility or
liability for the violation of such restrictions by any
person. Further details in relation to Overseas Shareholders
will be contained in the Offer Document (or, if the Acquisition is
implemented by way of a Scheme, the Scheme
Document).
Unless
otherwise determined by Bidco or required by the Takeover Code, and
permitted by applicable law and regulation, the Acquisition will
not be made available, in whole or in part, directly or indirectly,
in, into or from a Restricted Jurisdiction where to do so would
violate the laws in that jurisdiction and no person may vote in
favour of the Acquisition by any such use, means, instrumentality
or from within a Restricted Jurisdiction or any other jurisdiction
if to do so would constitute a violation of the laws of that
jurisdiction. Copies of this announcement and any formal
documentation relating to the Acquisition are not being, and must
not be, directly or indirectly, mailed or otherwise forwarded,
distributed or sent in or into or from any Restricted Jurisdiction
and persons receiving such documents (including, without
limitation, agents, custodians, nominees and trustees) must not
mail or otherwise forward, distribute or send it in or into or from
any Restricted Jurisdiction. Doing so may render invalid any
related purported vote in respect of the Acquisition. Unless
otherwise permitted by applicable law and regulation, the Offer may
not be made directly or indirectly, in or into, or by the use of
mails or any means or instrumentality (including, but not limited
to, facsimile, e-mail or other electronic transmission, telex or
telephone) of interstate or foreign commerce of, or of any facility
of a national, state or other securities exchange of any Restricted
Jurisdiction and the Offer may not be capable of acceptance by any
such use, means, instrumentality or facilities.
Further
details in relation to Overseas Shareholders will be included in
the Offer Document (or, if the Acquisition is implemented by way of
a Scheme, the Scheme Document).
Notice to U.S.
Hipgnosis Shareholders
The
Acquisition relates to the shares of a Guernsey company with a
listing on the London Stock Exchange and is being made by means of
takeover offer. A transaction effected by means of a takeover offer
or, if the Acquisition is to be implemented by means of a Scheme, a
scheme of arrangement is not subject to the tender offer or proxy
solicitation rules under the U.S. Securities Exchange
Act of 1934
(the "U.S. Exchange
Act"). Accordingly, the Acquisition is subject to the
disclosure requirements and practices applicable in Guernsey to
takeover offers and schemes of arrangement which differ from the
disclosure requirements of the U.S. tender offer and proxy
solicitation rules. The financial information included in this
announcement has been prepared in accordance with generally
accepted accounting principles of the UK and thus may not be
comparable to financial information of U.S. companies or companies
whose financial statements are prepared in accordance with
generally accepted accounting principles in the United
States.
If, in the
future, Bidco exercises its right to implement the Acquisition by
way of an Offer, which is to be made into the United
States, such
Offer will be
made in compliance with the applicable U.S. laws and
regulations.
It may be
difficult for U.S. holders of Hipgnosis Shares to enforce their
rights and any claim arising out of the U.S. federal laws, since
Bidco and Hipgnosis are located in a non-U.S. jurisdiction, and
some or all of their officers and directors may be residents of a
non-U.S. jurisdiction. U.S. holders of Hipgnosis Shares may
not be able to sue a non-U.S. company or its officers or directors
in a non-U.S. court for violations of the U.S. securities
laws. Further, it may be difficult to compel a non-U.S.
company and its affiliates to subject themselves to a U.S. court's
judgement.
In accordance
with normal UK practice and pursuant to Rule 14e-5(b) of the U.S.
Exchange Act, Blackstone or its nominees, or their brokers (acting
as agents), may from time to time make certain purchases of, or
arrangements to purchase, Hipgnosis Shares outside of the U.S.,
other than pursuant to the Acquisition, until the date on which
completion of the Acquisition occurs, lapses or is otherwise
withdrawn. Also, in accordance with Rule 14e-5(b) of the U.S.
Exchange Act, Jefferies will continue to act as an exempt principal
trader in Hipgnosis shares on the London Stock Exchange.
These purchases may occur either in the open market at prevailing
prices or in private transactions at negotiated prices. Any
information about such purchases will be disclosed as required in
the United Kingdom, will be reported to a Regulatory Information
Service and will be available on the London Stock Exchange
website,
www.londonstockexchange.com.
U.S.
Hipgnosis Shareholders also should be aware that the transaction
contemplated herein may have tax consequences in the U.S. and, that
such consequences, if any, are not described herein. U.S.
Hipgnosis Shareholders are urged to consult with legal, tax and
financial advisers in connection with making a decision regarding
this transaction.
Forward looking statements
This
announcement (including information incorporated by reference in
this announcement), statements made regarding the Acquisition, and
other information published by Bidco and Hipgnosis contain
statements which are, or may be deemed to be, "forward-looking
statements". Forward-looking statements are prospective in
nature and are not based on historical facts, but rather on current
expectations and projections of the management of Bidco and
Hipgnosis about future events, and are therefore subject to risks
and uncertainties which could cause actual results to differ
materially from the future results expressed or implied by the
forward-looking statements.
The
forward-looking statements contained in this announcement include
statements relating to the expected effects of the Acquisition on
Bidco and Hipgnosis (including their future prospects, developments
and strategies), the expected timing and scope of the Acquisition
and other statements other than historical facts. Often, but
not always, forward-looking statements can be identified by the use
of forward-looking words such as "prepares", "plans", "expects" or
"does not expect", "is expected", "is subject to", "budget",
"projects", "synergy", "strategy", "scheduled", "goal",
"estimates", "forecasts", "cost-saving", "intends", "target",
"aims", "anticipates", "continues", or "does not anticipate", or
"believes", or variations of such words and phrases or statements
that certain actions, events or results "may", "could", "should",
"would", "might" or "will" be taken, occur or be achieved.
Forward looking statements may include statements relating to the
following: (i) future capital expenditures, expenses, revenues,
earnings, synergies, economic performance, indebtedness, financial
condition, dividend policy, losses and future prospects; (ii)
business and management strategies and the expansion and growth of
Bidco's, Hipgnosis', any member of the Bidco Group's or any member
of the Hipgnosis Group's operations and potential synergies
resulting from the Acquisition; and (iii) the effects of global
economic conditions and governmental regulation on Bidco's,
Hipgnosis', any member of the Bidco Group's or any member of the
Hipgnosis Group's business.
Although
Bidco and Hipgnosis believe that the expectations reflected in such
forward-looking statements are reasonable, Bidco and Hipgnosis can
give no assurance that such expectations will prove to be
correct. By their nature, forward-looking statements involve
risk and uncertainty because they relate to events and depend on
circumstances that will occur in the future. There are a
number of factors that could cause actual results and developments
to differ materially from those expressed or implied by such
forward-looking statements.
These factors
include, but are not limited to: the ability to complete the
Acquisition; the ability to obtain requisite regulatory and
shareholder approvals and the satisfaction of other Conditions on
the proposed terms and schedule; changes in the global political,
economic, business and competitive environments and in market and
regulatory forces; changes in future exchange and interest rates;
changes in tax rates; future business combinations or disposals;
changes in general economic and business conditions; changes in the
behaviour of other market participants; changes in the anticipated
benefits from the Acquisition not being realised as a result of
changes in general economic and market conditions in the countries
in which Bidco and Hipgnosis operate, weak, volatile or illiquid
capital and/or credit markets, changes in tax rates, interest rate
and currency value fluctuations, the degree of competition in the
geographic and business areas in which Bidco and Hipgnosis operate
and changes in laws or in supervisory expectations or requirements.
Other unknown or unpredictable factors could cause actual results
to differ materially from those expected, estimated or projected in
the forward-looking statements. If any one or more of these
risks or uncertainties materialises or if any one or more of the
assumptions proves incorrect, actual results may differ materially
from those expected, estimated or projected. Such forward-looking
statements should therefore be construed in the light of such
factors. Neither Bidco nor Hipgnosis, nor any of their
respective associates or directors, officers or advisers, provides
any representation, assurance or guarantee that the occurrence of
the events expressed or implied in any forward-looking statements
in this announcement will actually occur. You are cautioned
not to place any reliance on these forward-looking
statements.
Specifically,
statements of estimated cost savings and synergies related to
future actions and circumstances which, by their nature, involve
risks, uncertainties and contingencies. As a result, the cost
savings and synergies referred to may not be achieved, may be
achieved later or sooner than estimated, or those achieved could be
materially different from those estimated. Due to the scale of the
Hipgnosis Group, there may be additional changes to the Hipgnosis
Group's operations. As a result, and given the fact that the
changes relate to the future, the resulting cost synergies may be
materially greater or less than those estimated.
Other than in
accordance with their legal or regulatory obligations, neither
Bidco nor Hipgnosis is under any obligation, and Bidco and
Hipgnosis expressly disclaim any intention or obligation, to update
or revise any forward-looking statements, whether as a result of
new information, future events or otherwise.
Dealing and opening position disclosure
requirements
Under Rule 8.3(a) of the Takeover Code, any person who is
interested in 1% or more of any class of relevant securities of an
offeree company or of any securities exchange offeror (being any
offeror other than an offeror in respect of which it has been
announced that its offer is, or is likely to be, solely in cash)
must make an Opening Position Disclosure following the commencement
of the offer period and, if later, following the announcement in
which any securities exchange offeror is first identified. An
Opening Position Disclosure must contain details of the person's
interests and short positions in, and rights to subscribe for, any
relevant securities of each of (i) the offeree company and (ii) any
securities exchange offeror(s). An Opening Position Disclosure by a
person to whom Rule 8.3(a) of the Takeover Code applies must be
made by no later than 3.30 pm (London time) on the 10th business
day following the commencement of the offer period and, if
appropriate, by no later than 3.30 pm (London time) on the 10th
business day following the announcement in which any securities
exchange offeror is first identified. Relevant persons who deal in
the relevant securities of the offeree company or of a securities
exchange offeror prior to the deadline for making an Opening
Position Disclosure must instead make a Dealing
Disclosure.
Under Rule 8.3(b) of the Takeover Code, any person who is, or
becomes, interested in 1% or more of any class of relevant
securities of the offeree company or of any securities exchange
offeror must make a Dealing Disclosure if the person deals in any
relevant securities of the offeree company or of any securities
exchange offeror. A Dealing Disclosure must contain details of the
dealing concerned and of the person's interests and short positions
in, and rights to subscribe for, any relevant securities of each of
(i) the offeree company and (ii) any securities exchange
offeror(s), save to the extent that these details have previously
been disclosed under Rule 8. A Dealing Disclosure by a person to
whom Rule 8.3(b) applies must be made by no later than 3.30 pm
(London time) on the business day following the date of the
relevant dealing.
If
two or more persons act together pursuant to an agreement or
understanding, whether formal or informal, to acquire or control an
interest in relevant securities of an offeree company or a
securities exchange offeror, they will be deemed to be a single
person for the purpose of Rule 8.3.
Opening Position Disclosures must also be made by the offeree
company and by any offeror and Dealing Disclosures must also be
made by the offeree company, by any offeror and by any persons
acting in concert with any of them (see Rules 8.1, 8.2 and
8.4).
Details of the offeree and offeror companies in respect of
whose relevant securities Opening Position Disclosures and Dealing
Disclosures must be made can be found in the Disclosure Table on
the Takeover Panel's website at www.thetakeoverpanel.org.uk,
including details of the number of relevant securities in issue,
when the offer period commenced and when any offeror was first
identified. You should contact the Panel's Market Surveillance Unit
on +44 (0)20 7638 0129 if you are in any doubt as to whether you
are required to make an Opening Position Disclosure or a Dealing
Disclosure.
Publication on
a website
In accordance
with Rule 26.1 of the Takeover Code, a copy of this announcement
and the documents required to be published under Rule 26 of the
Takeover Code will be made available, subject to certain
restrictions relating to persons resident in Restricted
Jurisdictions, on Hipgnosis' website at
https://communications.singercm.com/p/4UWI-EVY/blackstone-recommended-offer-hipgnosis
and on Bidco's website at
https://www.announcement-documents.com/
by no later than 12 noon (London
time) on the Business Day following this announcement. For
the avoidance of doubt, neither the content of this website nor of
any website accessible from any hyperlinks set out in this
announcement are incorporated by reference or form part of this
announcement.
No profit forecasts, estimates or quantified benefits
statements
No statement
in this announcement is intended as a profit forecast, profit
estimate or quantified benefits statement for any period and no
statement in this announcement should be interpreted to mean that
earnings or earnings per share for Hipgnosis for the current or
future financial years would necessarily match or exceed the
historical published earnings or earnings per share for
Hipgnosis.
General
Bidco
reserves the right to elect to implement the Acquisition by way of
a Scheme as an alternative to the Scheme, subject to the Panel's
consent and (while the Cooperation Agreement is continuing) to the
terms of the Cooperation Agreement. In such event, such
Scheme will be implemented on substantially the same terms and
conditions so far as applicable, as those which would apply to the
Offer (subject to appropriate amendments, and for so long as the
Cooperation Agreement is continuing and the Scheme arises in
accordance with the terms of the Cooperation
Agreement).
Investors
should be aware that Bidco may purchase Hipgnosis Shares otherwise
than under any Offer or the Scheme, including pursuant to privately
negotiated purchases.
Requesting hard copy documents
In accordance
with Rule 30.3 of the Takeover Code, Hipgnosis Shareholders and
persons with information rights may request a hard copy of this
announcement by contacting Hipgnosis' registrars, Computershare
Investor Services (Guernsey) Limited, or by calling 0370 707 4040
or from overseas +44 370 707 4040. Calls are charged at the
standard geographical rate and will vary by provider. Calls outside
the United Kingdom or Guernsey will be charged at the applicable
international rate. Lines are open between 8.30 a.m. to 5.30 p.m.
(London time), Monday to Friday (except public holidays in the UK
and Guernsey). Please note that Computershare Investor Services
(Guernsey) Limited cannot provide any financial, legal or tax
advice. Calls may be recorded and monitored for security and
training purposes. For persons who receive a copy of this
announcement in electronic form or via a website notification, a
hard copy of this announcement will not be sent unless so
requested. Such persons may also request that all future documents,
announcements and information to be sent to them in relation to the
Acquisition should be in hard copy form.
Electronic communications
Please be
aware that addresses, electronic addresses and certain other
information provided by Hipgnosis Shareholders, persons with
information rights and other relevant persons for the receipt of
communications from Hipgnosis may be provided to Bidco during the
offer period as required under Section 4 of Appendix 4 of the
Takeover Code to comply with Rule 2.11(c) of the Takeover
Code.
Rounding
Certain
figures included in this announcement have been subjected to
rounding adjustments. Accordingly, figures shown for the same
category presented in different tables may vary slightly and
figures shown as totals in certain tables may not be an arithmetic
aggregation of figures that precede them.
Disclaimer
The Acquisition will be subject to English law, the
jurisdiction of the Court, and the applicable requirements of the
GFSC, the Companies Law, the Takeover Code, the Panel and the
London Stock Exchange.
Appendix 1
Conditions and Further Terms of the Transaction
Part A
Conditions to the Acquisition
Conditions of the Offer
1.
The Offer will be conditional on, among other things, valid
acceptances being received (and not validly withdrawn) by not later
than 1.00 p.m. (London time) on the unconditional date (or such
later time(s) and/or date(s) as Bidco may, with the consent of the
Panel, decide) in respect of such number of Hipgnosis Shares as
shall, when aggregated with any Hipgnosis Shares acquired or
unconditionally agreed to be acquired (whether pursuant to the
Offer or otherwise) by Bidco, represent Hipgnosis Shares carrying
not less than 55 per cent. of the voting rights then exercisable at
a general meeting of Hipgnosis Shareholders (or such lower
percentage as Bidco may decide), provided that Bidco shall hold or
have acquired or agreed to acquire (whether pursuant to the Offer
or otherwise), directly or indirectly, Hipgnosis Shares carrying in
aggregate more than 50 per cent. of the voting rights then normally
exercisable at a general meeting of Hipgnosis (the "Acceptance Condition"). Unless the
Panel agrees otherwise, the Acceptance Condition shall only be
capable of being satisfied when all other Conditions have been
satisfied or waived.
For the purposes of this Condition
1:
1.1 valid
acceptances shall be deemed to have been received in respect of
Hipgnosis Shares which are treated for the purposes of the
Companies Law as having been acquired or contracted to be acquired
by Bidco by virtue of acceptances of the Offer or otherwise;
and
1.2 all
percentages of voting rights and share capital are to be calculated
by reference to the percentage held in issue excluding any and all
shares held as treasury shares by Hipgnosis from time to
time.
General Conditions
2.
In addition, subject as stated in Part B of this
Appendix 1, Bidco and Hipgnosis have agreed that the
Acquisition will be conditional upon the following Conditions and,
accordingly, the necessary actions to complete the Acquisition will
not be taken unless the following Conditions (as amended if
appropriate) have been satisfied or, where relevant,
waived:
Anti-trust and regulatory
clearances
2.1 subject
to: (i) the terms of Part B of this Appendix 1, and (ii) the
requirements of the Panel, the Acquisition will be conditional upon
the following Conditions and, accordingly, the necessary actions to
complete the Acquisition will not be taken unless the following
Conditions (as amended if appropriate) have been satisfied or,
where relevant, waived prior to completion of the
Acquisition:
United
Kingdom
2.1.1 insofar as
the Competition and Markets Authority ("CMA") requests information in relation
to the Acquisition pursuant to s.5 of the Enterprise Act 2002 (the
"Enterprise Act") or in
response to a briefing paper, the CMA shall have confirmed in
writing that it has no further questions in relation to the
Acquisition, and at the time all other Conditions to the
Acquisition are satisfied shall not have raised any outstanding
questions or otherwise indicated that it is considering whether to
open an investigation; or shall otherwise have cleared the
Acquisition pursuant to the Enterprise Act.
United States
of America
2.1.2 in so far as
the Acquisition satisfies the applicable premerger notification
thresholds, all necessary notifications and filings in respect of
the Acquisition shall have been made under the United States
Hart-Scott-Rodino Antitrust Improvements Act of 1976 (as amended)
(the "HSR Act") and the
regulations promulgated thereunder, and all applicable waiting
periods under the HSR Act and those regulations (including any
agreements with the U.S. Federal Trade Commission or the Antitrust
Division of the U.S. Department of Justice to delay consummation of
the Acquisition) shall have expired, lapsed or been
terminated
Notifications, waiting periods and
Clearances
2.2 In
addition to Condition 2.1 above, subject to: (i) the terms of Part
B of this Appendix 1, and (ii) the requirements of the Panel, the
Acquisition will be conditional upon the following Conditions and,
accordingly, the necessary actions to complete the Acquisition will
not be taken unless the following Conditions (as amended if
appropriate) have been satisfied or, where relevant, waived prior
to completion of the Acquisition:
2.2.1 all material
notifications, filings and/or applications which are deemed by
Bidco to be necessary in any relevant jurisdiction under applicable
legislation or regulation having been made and all necessary
waiting and other time periods (including any extensions thereof)
under any applicable legislation or regulation of any relevant
jurisdiction having expired, lapsed or been terminated (as
appropriate), and all statutory or regulatory obligations in any
relevant jurisdiction having been complied with, in each case in
connection with the Acquisition or the acquisition, or proposed
acquisition, of any shares or other securities (or the equivalent)
in, or control of, Hipgnosis or any other member of the Wider
Hipgnosis Group by any member of the Wider Bidco Group;
and
2.2.2 all other
Clearances which are deemed by Bidco to be necessary in any
relevant jurisdiction for or in respect of the Acquisition (or its
implementation) or the acquisition, or proposed acquisition, of any
shares or other securities (or the equivalent) in, or control of,
Hipgnosis or any other member of the Wider Hipgnosis Group by Bidco
or any member of the Wider Bidco Group, having been obtained on
terms and in a form reasonably satisfactory to Bidco from all
appropriate Relevant Authorities or (without prejudice to the
generality of the foregoing) from any persons or bodies with whom
any member of the Wider Bidco Group or any other member of the
Wider Hipgnosis Group has entered into contractual arrangements,
and all such Clearances, together with all Clearances necessary for
any member of the Wider Hipgnosis Group to carry on its business,
remaining in full force and effect at the time at which the Offer
becomes otherwise unconditional in all respects, and there being no
notice or intimation of any intention to revoke, suspend, restrict,
modify or not to renew such Clearances;
General Regulatory
2.3 No
Relevant Authority, having given notice of a decision
to take, institute, implement or threaten any action, proceeding,
suit, investigation, enquiry or reference (and, in each case,
without having withdrawn the same), or having required any action
to be taken or otherwise having done anything or having enacted,
issued, made or proposed any statute, regulation, decision or order
or change to published practice and there not continuing to be
outstanding or in effect any statute, regulation, decision or
order, whether temporary, preliminary or permanent, which has the
effect of or might:
2.3.1 make the
Acquisition, its implementation or the acquisition or proposed
acquisition of any shares or other securities (or the equivalent)
in, or control or management of, any member of the Wider Hipgnosis
Group by any member of the Wider Bidco Group and/ or its
implementation void, voidable, illegal and/or unenforceable under
the laws of any relevant jurisdiction, or otherwise directly or
indirectly prevent, prohibit, or restrain, restrict, materially
delay or otherwise materially interfere with the implementation of,
or impose material additional conditions or obligations with
respect to, or otherwise challenge, impede or interfere with the
Acquisition (or its implementation) or such acquisition, or require
material amendment to the terms of the Acquisition or the
acquisition of any shares or other securities (or the equivalent)
in, or control or management of, any member of the Wider Hipgnosis
Group by any member of the Wider Bidco Group;
2.3.2 require,
prevent or materially delay the divestiture or alter the terms
envisaged for such divestiture by any member of the Wider Bidco
Group or by any member of the Wider Hipgnosis Group of all or any
part of their respective businesses, assets or property or impose
any limitation on the ability of all or any of them to conduct
their businesses (or any part thereof) or to own, control or manage
any of their assets or properties (or any part thereof);
2.3.3 impose any
material limitation on, or result in a material delay in, the
ability of any member of the Wider Bidco Group directly or
indirectly to acquire or hold or to exercise effectively all or any
rights of ownership in respect of shares or other securities (or
the equivalent) in Hipgnosis (or any member of the Wider Hipgnosis
Group) or on the ability of any member of the Wider Hipgnosis Group
or any member of the Wider Bidco Group directly or indirectly to
hold or exercise effectively any rights of ownership in respect of
shares or other securities (or the equivalent) in, or to exercise
management control over, any member of the Wider Hipgnosis
Group;
2.3.4 other than in
the context of the Offer or, if applicable, the Companies Law,
require any member of the Wider Bidco Group or the Wider Hipgnosis
Group to acquire or offer to acquire any shares, other securities
(or the equivalent) or interest in any member of the Wider
Hipgnosis Group or any asset owned by any third party;
2.3.5 require,
prevent or materially delay a divestiture, or alter the terms
envisaged for any proposed divestiture, by any member of the Wider
Bidco Group of any shares or other securities (or the equivalent)
in any member of the Wider Hipgnosis Group;
2.3.6 result in any
member of the Wider Hipgnosis Group ceasing to be able to carry on
business under any name under which it presently carries on
business;
2.3.7 impose any
material limitation on the ability of any member of the Wider Bidco
Group or any member of the Wider Hipgnosis Group to conduct,
integrate or co‑ordinate all or any part of their respective
businesses with all or any part of the business of any other member
of the Wider Bidco Group and/or the Wider Hipgnosis Group (as
applicable); and
2.3.8 except as
Disclosed, otherwise adversely affect the business, assets,
financial or trading position or prospects of any member of the
Wider Hipgnosis Group or any member of the Wider Bidco
Group.
Confirmation of absence of adverse
circumstances
2.4 except as
Disclosed, there being no provision of any arrangement, agreement,
licence, permit, franchise, lease or other instrument to which any
member of the Wider Hipgnosis Group is a party or by or to which
any such member or any of its assets is or may be bound, entitled
or be subject or any event or circumstance which, as a consequence
of the Acquisition or the proposed acquisition by any member of the
Wider Bidco Group of any shares or other securities in Hipgnosis or
because of a change in the control or management of any member of
the Wider Hipgnosis Group or otherwise, would or might reasonably
be expected to result in, in each case to an extent which is
material in the context of the Wider Hipgnosis Group taken as a
whole or to the financing of the Acquisition:
2.4.1 any monies
borrowed by, or any other indebtedness, actual or contingent of, or
any grant available to, any member of the Wider Hipgnosis Group
being or becoming repayable, or capable of being declared
repayable, immediately or prior to its or their stated maturity
date or repayment date, or the ability of any such member to borrow
monies or incur any indebtedness being withdrawn or inhibited or
being capable of becoming or being withdrawn or
inhibited;
2.4.2 the rights,
liabilities, obligations, interests or business of any member of
the Wider Hipgnosis Group or any member of the Wider Bidco Group
under any such arrangement, agreement, licence, permit, lease or
instrument or the interests or business of any member of the Wider
Hipgnosis Group or any member of the Wider Bidco Group in or with
any other firm or company or body or person (or any agreement or
arrangement relating to any such business or interests) being or
likely to become terminated or adversely modified or affected or
any onerous obligation or liability arising or any adverse action
being taken or arising thereunder;
2.4.3 any member of
the Wider Hipgnosis Group ceasing to be able to carry on business
under any name under which it presently carries on business to an
extent which is material in the context of the Hipgnosis Group
taken as a whole or in the context of the Acquisition;
2.4.4 any assets or
interests of, or any asset the use of which is enjoyed by, any
member of the Wider Hipgnosis Group being or falling to be disposed
of or charged or any right arising under which any such asset or
interest could be required to be disposed of or charged or could
cease to be available to any member of the Wider Hipgnosis Group
otherwise than in the ordinary course of business;
2.4.5 other than in
the ordinary course of business, the creation or enforcement of any
mortgage, charge or other security interest over the whole or any
part of the business, property or assets of any member of the Wider
Hipgnosis Group or any such mortgage, charge or other security
interest (whenever created, arising or having arisen), becoming
enforceable;
2.4.6 the business,
assets, value, financial or trading position, profits, prospects or
operational performance of any member of the Wider Hipgnosis Group
being prejudiced or adversely affected;
2.4.7 the creation
or acceleration of any material liability (actual or contingent) by
any member of the Wider Hipgnosis Group other than trade creditors
or other liabilities incurred in the ordinary course of business;
or
2.4.8 any liability
of any member of the Wider Hipgnosis Group to make any severance,
termination, bonus or other payment to any of its directors or
other officers other than in the ordinary course of
business;
No material transactions, claims or changes in
the conduct of the business of the Hipgnosis Group
2.5 except as
Disclosed, no member of the Wider Hipgnosis Group having since 31
March 2023:
2.5.1 issued or
agreed to issue or authorised or proposed or announced its
intention to authorise or propose the issue of additional shares of
any class, or securities or securities convertible into, or
exchangeable for, or rights, warrants or options to subscribe for
or acquire, any such shares or convertible securities or
transferred or sold or agreed to transfer or sell or authorised or
proposed the transfer or sale of Hipgnosis Shares out of treasury
(except, where relevant, as between Hipgnosis and wholly-owned
subsidiaries of Hipgnosis or between the wholly-owned subsidiaries
of Hipgnosis);
2.5.2 recommended,
declared, paid or made or agreed to recommend, declare, pay or make
any bonus issue, dividend or other distribution (whether payable in
cash or otherwise) other than to Hipgnosis or one of its
wholly‑owned subsidiaries;
2.5.3 save as
between Hipgnosis and its wholly‑owned subsidiaries or between such
wholly‑owned subsidiaries, merged with (by statutory merger or
otherwise) or demerged from or acquired any body corporate,
partnership or business or acquired or disposed of, or, other than
in the ordinary course of business, transferred, mortgaged or
charged or created any security interest over, any assets or any
right, title or interest in any asset (including shares and trade
investments) or authorised, proposed or announced any intention to
do so, in each case to an extent which is material in the context
of the Wider Hipgnosis Group taken as a whole;
2.5.4 save as
between Hipgnosis and its wholly‑owned subsidiaries or between such
wholly‑owned subsidiaries, made, authorised, proposed or announced
an intention to propose any change in its loan capital other than
in the ordinary course of business and to an extent which is
material in the context of the Wider Hipgnosis Group taken as a
whole;
2.5.5 issued,
authorised or proposed or announced an intention to authorise or
propose the issue of, or made any change in or to the terms of, any
debentures or (save in the ordinary course of business and save as
between Hipgnosis and its wholly‑owned subsidiaries or between such
wholly‑owned subsidiaries) incurred or increased any indebtedness
or become subject to any contingent liability to an extent which is
material in the context of the Wider Hipgnosis Group taken as a
whole or in the context of the Acquisition;
2.5.6 entered into,
varied, authorised or proposed entry into or variation of, or
announced its intention to enter into or vary, any contract,
transaction, arrangement or commitment (whether in respect of
capital expenditure or otherwise) (otherwise than in the ordinary
course of business) which is of a long-term, unusual or onerous
nature, or which involves or could reasonably be expected to
involve an obligation of a nature or magnitude which is or is
likely to be materially restrictive on the business of any member
of the Wider Hipgnosis Group to an extent which is or is reasonably
likely to be material to the Wider Hipgnosis Group taken as a
whole;
2.5.7 entered into
any licence or other disposal of intellectual property rights of
any member of the Wider Hipgnosis Group which are material in the
context of the Wider Hipgnosis Group and outside the normal course
of business;
2.5.8 entered into,
varied, authorised or proposed entry into or variation of, or
announced its intention to enter into or vary the terms of or made
any offer (which remains open for acceptance) to enter into or vary
the terms of, any contract, commitment, arrangement or any service
agreement with any director or senior executive of the Wider
Hipgnosis Group save for salary increases, bonuses or variations of
terms in the ordinary course;
2.5.9 (i)
(excluding the trustee of any pension scheme(s) established by a
member of the Wider Hipgnosis Group other than Hipgnosis itself)
made, agreed or consented to or procured any significant change to:
(a) the terms of any existing trust deeds, rules, policy or
other governing documents, or entered into or established any new
trust deeds, rules, policy or other governing documents,
constituting any pension scheme or other retirement or death
benefit arrangement established for the directors, former
directors, employees or former employees of any entity in the Wider
Hipgnosis Group or their dependants and established by a member of
the Wider Hipgnosis Group (a "Relevant Pension Plan"); (b) the
basis on which benefits accrue, pensions which are payable or the
persons entitled to accrue or be paid benefits, under any Relevant
Pension Plan; (c) the basis on which the liabilities of any
Relevant Pension Plan are funded or valued; or (d) the basis
or rate of employer contribution to a Relevant Pension Plan, in
each case to the extent which is material in the context of the
Wider Hipgnosis Group taken as a whole or in the context of the
Acquisition and other than as required in accordance with
applicable law; or (ii) enter into or propose to enter into
one or more bulk annuity contracts in relation to any Relevant
Pension Plan; or (iii) carried out any act: (a) which
would or could reasonably be expected to lead to the commencement
of the winding up of any Relevant Pension Plan; (b) which
would or is reasonably likely to create a material debt owed by an
employer to any Relevant Pension Plan; (c) which would or might
accelerate any obligation on any employer to fund or pay additional
contributions to any Relevant Pension Plan; or (d) which would,
having regard to the published guidance of the Pensions Regulator
give rise directly or indirectly to a liability in respect of a
Relevant Pension Plan arising out of the operation of sections 38
and 38A of the Pensions Act 2004 in relation to a Relevant Pension
Plan, in each case to the extent which is material in the context
of the Wider Hipgnosis Group taken as a whole or in the context of
the Acquisition and other than as required in accordance with
applicable law;
2.5.10
changed the trustee or trustee directors or other fiduciary
of any Relevant Pension Plan;
2.5.11
entered into, implemented or effected, or authorised,
proposed or announced its intention to implement or effect, any
joint venture, asset or profit sharing arrangement, partnership,
composition, assignment, reconstruction, amalgamation, commitment,
scheme or other transaction or arrangement (other than the Offer)
otherwise than in the ordinary course of business which is material
in the context of the Wider Hipgnosis Group taken as a whole or in
the context of the Acquisition;
2.5.12
purchased, redeemed or repaid or announced any proposal to
purchase, redeem or repay any of its own shares or other securities
or reduced made any other change to any part of its share capital
to an extent which (other than in the case of Hipgnosis) is
material in the context of the Wider Hipgnosis Group taken as a
whole;
2.5.13
other than with respect to claims between Hipgnosis and its
wholly owned subsidiaries (or between such subsidiaries), waived,
compromised or settled any claim otherwise than in the ordinary
course of business which is material in the context of the Wider
Hipgnosis Group taken as a whole or in the context of the
Acquisition;
2.5.14
made any alteration to its articles of incorporation or other
constitutional documents (in each case, other than in connection
with the Offer) which is material in the context of the
Acquisition;
2.5.15
(other than in respect of a member of the Wider Hipgnosis
Group which is dormant and was solvent at the relevant time) taken
or proposed any steps, corporate action or had any legal
proceedings instituted or threatened against it in relation to the
suspension of payments, a moratorium of any indebtedness, its
winding‑up (voluntary or otherwise), dissolution, reorganisation or
for the appointment of any administrator, receiver, manager,
administrative receiver, trustee or similar officer of all or any
of its assets or revenues or any analogous proceedings in any
jurisdiction or appointed any analogous person in any jurisdiction
or had any such person appointed which is material in the context
of the Wider Hipgnosis Group taken as a whole or in the context of
the Acquisition;
2.5.16
been unable, or admitted in writing that it is unable, to pay
its debts or commenced negotiations with one or more of its
creditors with a view to rescheduling or restructuring any of its
indebtedness, or having stopped or suspended (or threatened to stop
or suspend) payment of its debts generally or ceased or threatened
to cease carrying on all or a substantial part of its business
which is material in the context of the Wider Hipgnosis Group taken
as a whole or in the context of the Acquisition;
2.5.17
entered into any contract, commitment, agreement or
arrangement otherwise than in the ordinary course of business or
passed any resolution or made any offer (which remains open for
acceptance) with respect to or announced an intention to, or to
propose to, effect any of the transactions, matters or events
referred to in this Condition;
2.5.18
terminated or varied the terms of any agreement or
arrangement between any member of the Wider Hipgnosis Group and any
other person in a manner which would or might be expected to have a
material adverse effect on the financial position of the Wider
Hipgnosis Group taken as a whole; or
2.5.19
taken (or agreed or proposed to take) any action which
requires, or would require, the consent of the Panel or the
approval of Hipgnosis Shareholders in general meeting in accordance
with, or as contemplated by, Rule 21.1 of the Takeover
Code;
No material adverse change
2.6 since 31
March 2023, and except as Disclosed, there having been:
2.6.1 no adverse
change and no circumstance having arisen which would be expected to
result in any adverse change or deterioration in the business,
assets, value, financial or trading position, profits, prospects or
operational performance of any member of the Wider Hipgnosis Group
to an extent which is material to the Wider Hipgnosis Group taken
as a whole or to the financing of the Acquisition;
2.6.2 no
litigation, arbitration proceedings, prosecution or other legal
proceedings including, without limitation, with regard to
intellectual property rights used by the Wider Hipgnosis Group
having been threatened, announced or instituted by or against or
remaining outstanding against any member of the Wider Hipgnosis
Group or to which any member of the Wider Hipgnosis Group is or may
become a party (whether as claimant or defendant or otherwise)
which, in any such case, might be expected to have a material
adverse effect on the Wider Hipgnosis Group taken as a whole, and
no enquiry, review, investigation or enforcement proceedings by, or
complaint or reference to, any Relevant Authority against or in
respect of any member of the Wider Hipgnosis Group having been
threatened, announced or instituted by or against, or remaining
outstanding in respect of, any member of the Wider Hipgnosis Group
which, in any such case, might be expected to have a material
adverse effect on the Wider Hipgnosis Group taken as a
whole;
2.6.3 no contingent
or other liability having arisen, increased or become apparent
which is reasonably likely to adversely affect the business,
assets, financial or trading position, profits, prospects or
operational performance of any member of the Wider Hipgnosis Group
to an extent which is material to the Wider Hipgnosis Group taken
as a whole;
2.6.4 no steps
having been taken and no omissions having been made which are
reasonably likely to result in the withdrawal, cancellation,
termination or modification of any licence held by any member of
the Wider Hipgnosis Group, which is necessary for the proper
carrying on of its business and the withdrawal, cancellation,
termination or modification of which is material and reasonably
likely to have a material adverse effect on the Wider Hipgnosis
Group taken as a whole; and
2.6.5 no member of
the Wider Hipgnosis Group having conducted its business in material
breach of any applicable laws and regulations which in any case is
material in the context of the Wider Hipgnosis Group taken as a
whole;
2.7 since 31
March 2023, except as Disclosed, Bidco not having
discovered:
2.7.1 that any
financial, business or other information concerning the Wider
Hipgnosis Group publicly announced or disclosed to any member of
the Wider Bidco Group at any time prior to the date of this
announcement by or on behalf of any member of the Wider Hipgnosis
Group or to any of their advisers is misleading, contains a
misrepresentation of fact or omits to state a fact necessary to
make that information not misleading and which is, in any case,
material in the context of the Wider Hipgnosis Group taken as a
whole or in the context of the Acquisition;
2.7.2 that any
member of the Wider Hipgnosis Group is subject to any liability,
contingent or otherwise and which is material in the context of the
Wider Hipgnosis Group taken as a whole; or
2.7.3 any
information which affects the import of any information disclosed
to Bidco at any time prior to the date of this announcement by or
on behalf of any member of the Wider Hipgnosis Group which is
material in the context of the Wider Hipgnosis Group taken as a
whole;
Environmental liabilities
2.8 since 31
March 2023, except as Disclosed, Bidco not having discovered that,
in relation to any release, emission, accumulation, discharge,
disposal or other similar circumstance which has impaired or is
likely to impair the environment (including property) or harmed or
is likely to harm the health of humans, animals or other living
organisms or eco‑systems, no past or present member of the Wider
Hipgnosis Group, in a manner or to an extent which is material in
the context of the Wider Hipgnosis Group, (i) having committed
any violation of any applicable laws, statutes, regulations,
Clearances, notices or other requirements of any Relevant Authority
giving rise to a material liability; and/or (ii) having
incurred any material liability (whether actual or contingent) to
any Relevant Authority; and/or (iii) being likely to incur any
material liability (whether actual or contingent), or being
required, to make good, remediate, repair, re‑instate or clean up
the environment (including any property) in each case of (i), (ii)
or (iii) which such liability or requirement would be material to
the Wider Hipgnosis Group taken as a whole;
Intellectual property
2.9 except as
Disclosed, no circumstance having arisen or event having occurred
in relation to any intellectual property owned or used by any
member of the Wider Hipgnosis Group which would be reasonably
likely to have a material adverse effect on the Wider Hipgnosis
Group taken as a whole or is otherwise material in the context of
the Acquisition, including:
2.9.1 any member of
the Wider Hipgnosis Group losing its title to any intellectual
property material to its business, or any intellectual property
owned by the Wider Hipgnosis Group and material to its business
being revoked, cancelled or declared invalid;
2.9.2 any claim
being asserted in writing or threatened in writing by any person
challenging the ownership of any member of the Wider Hipgnosis
Group to, or the validity or effectiveness of, any of its
intellectual property; or
2.9.3 any agreement
regarding the use of any intellectual property licensed to or by
any member of the Wider Hipgnosis Group being terminated or
varied;
Anti‑corruption and sanctions
2.10
except as Disclosed, Bidco not having discovered that (to an
extent that is material in the context of the Wider Hipgnosis Group
taken as a whole):
2.10.1
any past or present member of the Wider Hipgnosis Group or
any person that performs or has performed services for or on behalf
of any such company is or has at any time engaged in any activity,
practice or conduct (or omitted to take any action) in
contravention of the UK Bribery Act 2010, the U.S. Foreign
Corrupt Practices Act of 1977, as amended or any other applicable
anti‑corruption legislation;
2.10.2
any member of the Wider Hipgnosis Group is ineligible to be
awarded any contract or business under section 23 of the
Public Contracts Regulations 2006 or section 26 of the
Utilities Contracts Regulations 2006 (each as
amended);
2.10.3
any past or present member of the Wider Hipgnosis Group has
engaged in any activity or business with, or made any investments
in, or made any payments to any government, entity or individual
covered by any of the economic sanctions administered by the United
Nations or the European Union (or any of their respective member
states) or the United States Office of Foreign Assets Control or
any other governmental or supranational body or authority in any
jurisdiction; or
2.10.4
a member of the Hipgnosis Group has engaged in a transaction
which would cause the Bidco Group to be in breach of any law or
regulation on completion of the Acquisition, including the economic
sanctions administered by the United States Office of Foreign
Assets Control or HM Treasury & Customs or any government,
entity or individual targeted by any of the economic sanctions of
the United Nations, United States or the European Union or any of
its member states; or
No criminal property
2.11
except as Disclosed, Bidco not having discovered that any
asset of any member of the Wider Hipgnosis Group constitutes
criminal property as defined by section 340(3) of the Proceeds
of Crime Act 2002 (but disregarding paragraph (b) of that
definition).
Part B
Further terms of the Acquisition
1.
Subject to the requirements of the Panel and the Takeover
Code, Bidco reserves the right in its sole discretion to waive, in
whole or in part, all or any of the Conditions set out in
Part A of Appendix 1, except Condition 1 which cannot be
waived. If a Condition is not satisfied by the relevant deadline
specified in the relevant Condition, Bidco shall make an
announcement by 8.00 a.m. on the Business Day following such
deadline confirming whether it has invoked the relevant Condition,
waived the relevant deadlines or agreed with Hipgnosis to extend
the relevant deadline.
2.
Bidco shall be under no obligation to waive (if capable of
waiver), to determine to be or remain satisfied or to treat as
fulfilled any of the Conditions in Part A of Appendix 1
above that are capable of waiver by a date earlier than the latest
date for the fulfilment of that Condition notwithstanding that the
other Conditions of the Acquisition may at such earlier date have
been waived or fulfilled and that there are at such earlier date no
circumstances indicating that any of such Conditions may not be
capable of fulfilment.
3.
Under Rule 13.5(a) of the Takeover Code and subject to
paragraph 4, Bidco may only invoke a Condition so as to cause the
Acquisition not to proceed, to lapse or to be withdrawn with the
consent of the Panel. The Panel will normally only give its
consent if the circumstances which give rise to the right to invoke
the Condition are of material significance to Bidco in the context
of the Acquisition. This will be judged by reference to the
facts of each case at the time that the relevant circumstances
arise.
4.
Condition 1 (subject to Rule 12 of the Takeover Code) in
Part A of Appendix 1 above, and, if applicable, any
condition if the Acquisition is implemented by means of a Scheme,
are not subject to Rule 13.5(a) of the Takeover Code.
5.
Any Condition that is subject to Rule 13.5(a) of the Takeover
Code may be waived by Bidco.
6.
If the Panel requires Bidco to make an offer or offers for
Hipgnosis Shares under the provisions of Rule 9 of the Takeover
Code, Bidco may make such alterations to the Conditions as are
necessary to comply with the provisions of that Rule.
7.
Bidco reserves the right to elect to implement the
Acquisition by way of a Scheme as an alternative to the Offer,
subject to the Panel's consent and (while the Cooperation Agreement
is continuing) to the terms of the Cooperation Agreement. In
such an event, such Scheme will be implemented on the same terms
and conditions so far as applicable, as those which would apply to
the Offer.
8.
The Acquisition will be subject, inter alia, to the Conditions and
certain further terms which are set out in this Appendix 1 and
to the full terms which will be set out in the Offer Document and
such further terms as may be required to comply with the provisions
of the Takeover Code and the applicable requirements of the Panel
and the London Stock Exchange.
9.
Hipgnosis Shares will be acquired by Bidco pursuant to the
Acquisition fully paid and free from all liens, charges,
encumbrances and other third party rights of any nature whatsoever
and together with all rights attaching to them as at completion of
the Acquisition, including the right to receive and retain all
dividends and distributions (if any) declared, made or paid after
completion of the Acquisition.
10. If, on or
after the date of this announcement and prior to completion of the
Acquisition, any dividend and/or distribution is announced,
declared, made or paid in respect of the Hipgnosis Shares with a
record date prior to completion of the Acquisition, Bidco reserves
the right to reduce the consideration payable under the terms of
the Acquisition for the Hipgnosis Shares by an amount up to the
aggregate amount of such dividend and/or distribution, in which
case any reference in this announcement to the consideration
payable under the terms of the Acquisition will be deemed to be a
reference to the consideration as so reduced. Any exercise by Bidco
of its rights referred to in this paragraph 10 shall be the subject
of an announcement and, for the avoidance of doubt, shall not be
regarded as constituting any revision or variation of the Offer or
the Acquisition. In such circumstances, Hipgnosis Shareholders
would be entitled to retain any such dividend or
distribution.
11. The
availability of the Acquisition to persons not resident in the
United Kingdom may be affected by the laws or regulatory
requirements of the relevant jurisdictions. Persons who are not
resident in the United Kingdom should inform themselves about and
observe any applicable requirements.
12. The
Acquisition will be governed by English law and be subject to the
jurisdiction of the Court, to the Conditions set out above and full
terms to be set out in the Offer Document. The Acquisition will be
subject to the applicable requirements of the GFSC, the Companies
Law, the Panel and the London Stock Exchange.
13. Each of
the Conditions shall be regarded as a separate Condition and shall
not be limited by reference to any other Condition.
Appendix 2
Sources and Bases of Information
In this announcement, unless
otherwise stated or the context otherwise requires, the following
sources and bases have been used.
1.
The issued ordinary share capital of 1,209,214,286 Hipgnosis
Shares is based on 1,209,214,286 Hipgnosis Shares in issue as at 26
April 2024 (being the latest practicable date before this
announcement).
2.
A value of approximately $1,572 million for the entire issued
and to be issued share capital of Hipgnosis is based on:
2.1 the
Acquisition Price; and
2.2
Hipgnosis' issued ordinary share capital of 1,209,214,286
Hipgnosis Shares, as set out in paragraph 1 above.
3.
For the purposes of Rule 29.1 of the Takeover Code, set out
below is a reconciliation between the unaudited IFRS NAV as at 30
September 2023 and the unaudited Adjusted 30 September 2023
Operative NAV:
US$'000 unless stated
otherwise
|
Unaudited IFRS NAV as at 30
September 2023(1)
|
Adjustment for Operative NAV
as per the Interim Results to 30 September
2023(2)
|
Operative NAV as per the
Interim Results to 30 September
2023(2)
|
Adjustment for sale of
portfolio of non-core assets(3)
|
Adjustment for double
counting of accrued revenue (4)
|
Adjustment for Fair Market
Value of the Catalogues of Songs (as at 26 March
2024)(5)
|
Unaudited Adjusted 30
September 2023 Operative NAV
|
Catalogues
of Songs
|
$1,824,675
|
$797,325
|
$2,622,000
|
($29,100)
|
|
($644,597)
|
$1,948,303
|
Other
non-current assets
|
$10,856
|
|
$10,856
|
|
|
|
$10,856
|
Cash and
cash equivalents
|
$34,336
|
|
$34,336
|
$22,970
|
|
|
$57,306
|
Other
current assets
|
$179,825
|
($25,948)
|
$153,877
|
|
($107,827)
|
|
$46,050
|
Total
liabilities
|
($718,163)
|
|
($718,163)
|
|
|
|
($718,163)
|
Net assets
|
$1,331,529
|
|
$2,102,906
|
|
|
|
$1,344,352
|
Total
number of Ordinary Shares in issue (excluding treasury
shares)
|
1,209,214
|
|
1,209,214
|
|
|
|
1,209,214
|
Net asset
value per share
|
$1.101
|
|
$1.739
|
|
|
|
$1.112
|
1.
As disclosed in the Interim Report for the period ended 30
September
2023.
2.
Represents the IFRS NAV adjusted for the Fair Value of the
Catalogues of Songs, as disclosed in the Interim Report for the
period ended 30 September 2023. Adjustment to "Catalogues of
Songs" value reflects the excess of fair market value as derived by
Citrin Cooperman over the net book value. The adjustment to
"other current assets" includes the cost basis of certain
catalogues held for sale by the Company less accumulated
depreciation and
amortization.
3.
Represents the impact of the proceeds from the disposal of non-core
assets of c. 20,000 Songs, as announced by the Company on 11
December 2023 and reflects a reduction in the fair market value of
"Catalogues of Songs" based on Citrin Cooperman's valuation of the
divested catalogs with Cash and cash equivalents increasing based
on the net proceeds realized upon the closing of the
sale.
4.
Represents the correction of the double counting of accrued
revenue, which reverses the accrued income balance and royalty
accruals on accrued income, in the calculation of Operative NAV, as
announced by the Company on 18 March 2024.
5.
Represents the adjustment to the fair market value of the Company's
Portfolio using the midpoint of the valuation range valued by Shot
Tower Capital LLC as of 26 March 2024 and announced by the Company
on 28 March 2024.
4.
Unless otherwise stated, the financial information of
Hipgnosis is extracted (without material adjustment) from the
annual report and audited accounts of the Hipgnosis Group for the
12 months ended 31 March 2023, and the unaudited, consolidated
financial statements of Hipgnosis for the six months ended 30
September 2023.
5.
The volume-weighted average prices have been derived from
Bloomberg.
6.
Certain figures included in this announcement have been
subject to rounding adjustments.
7.
USD figures have been converted to GBP using the £:$ exchange
rate of £1:$1.2455 as at 16:30 GMT on 26 April 2024 (being
the last Business Day before the date of this announcement) as
derived from data provided by Daily Official List.
Appendix 3
Definitions
The following
definitions apply throughout this document unless the context
otherwise requires:
"2023 Hipgnosis Annual Report"
|
the annual report and audited accounts of the
Hipgnosis Group for the year ended 31 March 2023
|
"Acquisition"
|
the proposed cash acquisition by Bidco of the
entire issued, and to be issued, share capital of Hipgnosis to be
implemented by way of the Offer, or should Bidco so elect, and
where required, the Panel consent (subject to the terms of the
Cooperation Agreement whilst it remains in force), by means of a
Scheme and, where the context admits, any subsequent revision,
variation, extension or renewal thereof
|
"Acquisition Price"
|
$1.30 per Hipgnosis Share
|
"Adjusted 30 September 2023 Operative
NAV"
|
Hipgnosis' Operative NAV based on the Operative
NAV as at 30 September 2023 of $2,102,906,000 adjusted for
(i) the sale of the portfolio of non-core assets; (ii) the double
counting of accrued revenue; and (iii) Shot Tower's valuation of
the fair market value of the catalogues of songs as at 26 March
2024, as set out in Appendix 2 Paragraph 3
|
"Announcement Exchange Rate"
|
the £:$ exchange rate of £1:$1.2455 as at 16:30
GMT on 26 April 2024 (being the last Business Day before the date
of this announcement) as derived from data provided by Daily
Official List
|
"Articles"
|
the articles of incorporation of Hipgnosis from
time to time
|
"associated undertaking"
|
shall be construed in accordance with paragraph
19 of Schedule 6 to The Large and Medium sized Companies and Groups
(Accounts and Reports) Regulations 2008 (SI 2008/410) but for this
purpose ignoring paragraph 19(1)(b) of Schedule 6 to those
regulations
|
"Bidco"
|
Lyra Bidco Limited
|
"Bidco Board"
|
the directors of Bidco
|
"Bidco Group"
|
Bidco and its subsidiary undertakings and where
the context permits, each of them
|
"Blackstone"
|
Blackstone Inc. (together with its
affiliates)
|
"Blackstone Funds"
|
investment funds advised by affiliates of
Blackstone
|
"Business Day"
|
a day, not being a public holiday in the UK or
Guernsey, a Saturday or Sunday, and on which clearing banks in
London are open for normal business
|
"certificated" or "certificated form"
|
in relation to a share or other security, a
share or other security title to which is recorded in the relevant
register of the share or other security as being held in
certificated form (that is, not in CREST)
|
"Clearances"
|
all approvals, authorisations, grants,
recognitions, consents, licences, clearances, certificates,
permissions, confirmations, comfort letters and waivers that need
to be obtained, and all filings that need to be made and all
waiting periods that may need to have expired, from or under any of
the laws, regulations or practices applied by, any Relevant
Authority (or under any agreement or arrangements to which any
Relevant Authority is a party), in each case that are necessary
and/or (following consultation between the parties) expedient to
satisfy the Conditions in clause 3 of Appendix 1, Part A; and any
reference to any Clearance having been "satisfied" shall be construed as
meaning that the foregoing has been obtained or, where relevant,
made or expired
|
"Closing Price"
|
the closing middle market price of a Hipgnosis
Share as derived from the Daily Official List on any particular
date
|
"CMA"
|
the Competition and Markets
Authority
|
"Companies Law"
|
the Companies (Guernsey) Law, 2008, as amended
from time to time
|
"Concord"
|
Concord Chorus Limited, an entity
indirectly controlled by Alchemy Copyrights, LLC
|
"Concord Revised Offer"
|
the increased recommended
cash offer to acquire the entire issued and to be issued
share capital of Hipgnosis made by Concord on 24 April
2024
|
"Condition"
|
each of the conditions listed in
Part A of
Appendix 1 and any reference to a numbered
Condition shall be a reference to the Condition set out in the
paragraph of Part A of
Appendix 1 bearing such number
|
"Confidentiality Agreement"
|
the confidentiality agreement dated 11
April 2024 between Blackstone Europe LLP
and Hipgnosis
|
"Cooperation Agreement"
|
the cooperation agreement dated on or around
the date of this announcement between Bidco and
Hipgnosis
|
"Court"
|
the Royal Court of Guernsey
|
"Court Meeting"
|
if the Acquisition is to be implemented by
means of a Scheme, the meeting of Hipgnosis Shareholders (or the
relevant classes thereof) to be convened at the direction of the
Court pursuant to section 107 of the Companies Law at which a
resolution will be proposed to approve the Scheme (with or without
amendment), including any adjournment, postponement or reconvening
thereof
|
"CREST"
|
the CREST system (as defined in the
Regulations)
|
"Daily Official List"
|
the daily official list of the London Stock
Exchange
|
"Dealing Disclosure"
|
an announcement by a party to an offer or a
person acting in concert as required by Rule 8 of the Takeover
Code
|
"Disclosed"
|
the information fairly disclosed by or on
behalf of Hipgnosis: (i) in the 2023 Hipgnosis Annual Report; (ii)
in the Half Year Results for the six months period ended 30
September 2023; (iii) in this announcement; (iv) in any other
announcement to a Regulatory Information Service prior to the
publication of this announcement; and (v) in writing (including via
the virtual data room operated by or on behalf of Hipgnosis in
respect of the Acquisition) or orally in meetings and calls by
Hipgnosis management prior to the date of this announcement to
Bidco or Bidco's officers or advisers (in their capacity as
such)
|
"Disclosure Guidance and Transparency
Rules"
|
the Disclosure Guidance and Transparency Rules
sourcebook issued by the FCA
|
"Enterprise Act"
|
the Enterprise Act 2002
|
"FCA"
|
the Financial Conduct Authority or its
successor from time to time
|
"FCA Handbook"
|
the FCA's Handbook of rules and guidance as
amended from time to time
|
"Form of Election"
|
the form of election for use by Hipgnosis
Shareholders electing to receive their Acquisition cash
consideration in Sterling
|
"General Meeting"
|
if the Acquisition is to be implemented by
means of a Scheme, the general meeting of Hipgnosis Shareholders to
be convened to consider and if thought fit pass, inter alia, the
Resolutions (with or without amendment) in relation to the Scheme
including any adjournments, postponement or reconvening
thereof
|
"GFSC"
|
Guernsey Financial Services
Commission
|
"Gross Asset Value"
|
at any date, the aggregate of: (i) the value of
all the investments of Hipgnosis as determined by the Hipgnosis
Directors and calculated in the case of copyrights by reference to
an independent valuer's determination of the appropriate current
value for such copyrights, which is to be calculated in accordance
with Hipgnosis' latest published valuation methodology, among other
things, as regards the fair market value of the copyrights; and
(ii) the amount which, in accordance with Hipgnosis' latest
published valuation methodology, fairly reflects the value of all
other assets of Hipgnosis
|
"Hipgnosis"
|
Hipgnosis Songs Fund Limited
|
"Hipgnosis Board" or "Hipgnosis Directors"
|
the directors of Hipgnosis
|
"Hipgnosis Group"
|
Hipgnosis and its subsidiary undertakings and
where the context permits, each of them
|
"Hipgnosis Shareholder(s)"
|
holders of Hipgnosis Shares
|
"Hipgnosis Share(s)"
|
the existing issued and fully paid ordinary
shares of no par value in the capital of Hipgnosis and any further
shares which are issued before completion of the Acquisition and
"Hipgnosis Share" means any
one of them
|
"HSG"
|
Hipgnosis Songs Group LLC
|
"HSM" or "Investment Adviser"
|
Hipgnosis Song Management Limited
|
"HSR Act"
|
the United States Hart-Scott-Rodino Antitrust
Improvements Act of 1976 (as amended)
|
"IFRS"
|
the International Financial Reporting
Standards
|
"Investment Advisory
Agreement"
|
the investment advisory agreement entered into
between Hipgnosis, Hipgnosis Songs Holdings UK Limited
and HSM, dated 27 June 2018, as amended on 1 December 2020, and as
further amended on 8 October 2021, and as further amended on 14
September 2023, and as may be further amended from time to
time
|
"Jefferies"
|
Jefferies International Limited
|
"London Stock Exchange"
|
the London Stock Exchange plc or its
successor
|
"Long Stop Date"
|
5 November 2024 or such later date
as may be agreed between Bidco and Hipgnosis and, if required, the
Panel and the Court may allow
|
"Main Market"
|
the London Stock Exchange's main market for
listed securities
|
"Market Abuse Regulation"
|
Regulation (EU) 596/2014, as it forms part of
domestic law of the United Kingdom by virtue of the European Union
(Withdrawal) Act 2018, as amended from time to time
|
"Meetings"
|
if the Acquisition is to be implemented by
means of a Scheme, the Court Meeting and the General
Meeting
|
"Offer"
|
should the Acquisition be implemented by way of
a contractual takeover offer as provided for in section 337 of the
Companies Law, subject to the terms of the Cooperation Agreement,
the offer to be made by or on behalf of Bidco to acquire the entire
issued, and to be issued, share capital of Hipgnosis, and, where
the context admits, any subsequent revision, variation, extension
or renewal of such offer
|
"Offer Document"
|
should the Acquisition be implemented by means
of the Offer, the document to be sent to Hipgnosis Shareholders
which will contain, amongst other things, the terms and conditions
of the Offer
|
"Offer Period"
|
the offer period (as defined in the Takeover
Code) relating to Hipgnosis which commenced on the day of this
announcement
|
"Official List"
|
the official list of the FCA
|
"Opening Position Disclosure"
|
an announcement pursuant to Rule 8 of the
Takeover Code containing details of interests or short positions
in, or rights to subscribe for, any relevant securities of a party
to the Acquisition
|
"Operative NAV"
|
at any date, the Gross Asset Value less the
amount which (to the extent not otherwise deducted in the
calculation of Gross Asset Value), in accordance with Hipgnosis'
latest published valuation methodology, fairly reflects the amount
of the liabilities and expenses of Hipgnosis
|
"Operative NAV per Hipgnosis
Share"
|
the Operative NAV divided by the number of
Hipgnosis Shares in issue at the time of calculation
|
"Overseas Shareholders"
|
holders of Hipgnosis Shares who are resident
in, ordinarily resident in, or citizens of, jurisdictions outside
the United Kingdom
|
"Panel"
|
the Panel on Takeovers and Mergers
|
"Regulations"
|
the Uncertificated Securities (Guernsey)
Regulations, 2009 (SI 2009 No. 48), including: (i) any enactment or
subordinate legislation which amends or supersedes those
regulations; and (ii) any applicable rules made under those
regulations or any such enactment or subordinate legislation for
the time being in force
|
"Regulatory Information
Service"
|
a regulatory information service as defined in
the FCA Handbook
|
"Relevant Authority"
|
any merger control authority, any court or
competition, antitrust, national, supranational or supervisory
body, central bank, government or governmental, quasi-governmental
or statutory, regulatory environmental, investigative body or trade
agency, association, association or institution, in each case in
any jurisdiction, and including, for the avoidance of doubt, the UK
Competition and Markets Authority, the United States Department of
Justice, the United States Federal Trade Commission and the Panel,
and "Relevant Authorities"
means all of them
|
"relevant securities"
|
as the context requires, Hipgnosis Shares,
other Hipgnosis share capital and any securities convertible into
or exchangeable for, and rights to subscribe for, any of the
foregoing
|
"Resolution"
|
if the Acquisition is to be implemented by
means of a Scheme, the resolution to be proposed at the General
Meeting necessary to implement the Scheme, including, amongst other
things, certain amendments to be made to the articles of
incorporation of Hipgnosis
|
"Restricted Jurisdiction"
|
any jurisdiction where local laws or
regulations may result in a significant risk of civil, regulatory
or criminal exposure if information concerning the Offer is sent or
made available to Hipgnosis Shareholders in that
jurisdiction
|
"Scheme"
|
subject to the consent of the Panel
and the terms of the Cooperation Agreement, should the Acquisition
be implemented by means of a scheme of arrangement under Part VIII
of the Companies Law between Hipgnosis
and the holders of the Hipgnosis Shares to which the Scheme
applies, with or subject to any modification, addition or condition
approved or imposed by the Court and agreed by
Hipgnosis and
Bidco
|
"Scheme
Document"
|
if the Acquisition is to be
implemented by means of a Scheme, the
document to be sent to Hipgnosis Shareholders and other affected persons
containing, amongst other things, the Scheme and
notices of the Meetings and proxy forms in respect of the
Meetings
|
"Shot Tower"
|
Shot Tower Capital LLC, valuer and strategic
adviser to Hipgnosis
|
"Singer Capital Markets"
|
Singer Capital Markets Advisory LLP, Rule 3
adviser to Hipgnosis
|
"Takeover Code"
|
the Takeover Code issued by the Panel on
Takeovers and Mergers, as amended from time to time
|
"UK" or "United Kingdom"
|
United Kingdom of Great Britain and Northern
Ireland
|
"U.S." or "United States"
|
United States of America
|
"U.S. Exchange Act"
|
the U.S. Securities Exchange Act of
1934
|
"uncertificated" or "in uncertificated form"
|
a share or other security title to which is
recorded in the relevant register of the share or security as being
held in uncertificated form, in CREST, and title to which, by
virtue of the Regulations may be transferred by means of
CREST
|
"Voting Record Time"
|
the time and date to be specified in the Scheme
Document by reference to which entitlement to vote on the Scheme
will be determined
|
"Wider Bidco Group"
|
Bidco Group and associated undertakings and any
other body corporate, partnership, joint venture or person in which
Bidco and such undertakings (aggregating their interests) have an
interest of more than 30 per cent. of the voting or equity capital
or the equivalent
|
"Wider Hipgnosis Group"
|
Hipgnosis and associated undertakings and any
other body corporate, partnership, joint venture or person in which
Hipgnosis and such undertakings (aggregating their interests) have
an interest of more than 30 per cent. of the voting or equity
capital or the equivalent (excluding, for the avoidance of doubt,
Bidco and all of its associated undertakings which are not members
of the Hipgnosis Group)
|
In this announcement, "subsidiary", "subsidiary undertaking", "undertaking" and "associated undertaking" have the
respective meanings given thereto by the Companies Act.
All references to "pounds", "pounds Sterling", "Sterling", "GBP", "£", "pence", "penny" and "p" are to the lawful currency of the
United Kingdom.
All references to "dollars", "US dollars", "US$", "$", and "cent" are to the lawful currency of the
United States of America
All references to a statutory
provision or law or to any order or regulation shall be construed
as a reference to that provision, law, order or regulation as
extended, modified, replaced or re-enacted from time to time and
all statutory instruments, regulations and orders from time to time
made thereunder or deriving validity therefrom.
A reference to "includes" shall mean "includes without limitation", and
references to "including"
and any other similar term shall be construed
accordingly.
All the times referred to in this
announcement are London (UK) times unless otherwise
stated.
References to the singular include
the plural and vice versa.