Trading, Strategic Review & Formal Sale Process

RNS Number : 2528C

Bonhill Group PLC

10 October 2022

 

NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION IN WHOLE OR IN PART, INTO OR WITHIN THE UNITED STATES, AUSTRALIA, CANADA, JAPAN, SOUTH AFRICA OR ANY OTHER JURISDICTION WHERE TO DO SO WOULD CONSTITUTE A VIOLATION OF THE RELEVANT LAWS OR REGULATIONS OF THAT JURISDICTION.

THIS IS AN ANNOUNCEMENT UNDER RULE 2.4 OF THE CITY CODE ON TAKEOVERS AND MERGERS (THE "TAKEOVER CODE") AND IS NOT AN ANNOUNCEMENT OF A FIRM INTENTION BY ANY PARTY TO MAKE AN OFFER UNDER RULE 2.7 OF THE TAKEOVER CODE. THERE CAN BE NO CERTAINTY THAT AN OFFER WILL BE MADE FOR BONHILL GROUP PLC, NOR AS TO THE TERMS ON WHICH ANY OFFER MAY BE MADE.

THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION FOR THE PURPOSES OF ARTICLE 7 OF THE UK VERSION OF THE EU MARKET ABUSE REGULATION WHICH IS PART OF UK LAW BY VIRTUE OF THE EUROPEAN UNION (WITHDRAWAL) ACT 2018, AS AMENDED AND SUPPLEMENTED FROM TIME TO TIME INCLUDING BY THE MARKET ABUSE (AMENDMENT) (EU EXIT) REGULATIONS 2019 (SI 2019/ 310)("MAR")).

10 October 2022 

Bonhill Group plc

("Bonhill", the "Company" or the "Group")

Trading Statement,

Loan Facility,

Strategic Review

and

Formal Sale Process

Bonhill Group plc (AIM: BONH), a leading B2B media business specialising in financial services providing media, events and data & analytics, announces a trading statement, the entering into of a standby loan facility with its largest shareholder, a strategic review and a formal sale process.

Trading Statement

In its unaudited interim results for the six months ended 30 June 2022 ("Interim Results") released on 8 September 2022, Bonhill highlighted that market turbulence had led to a weakening in traditional media and content projects, as clients had held off on discretionary marketing spend. The Company announces that since then, trading conditions have continued to deteriorate resulting in weaker than expected digital revenues, in particular in the US, and, as a result, the Board's confidence in the outlook for trading in Q4 2022 has weakened. The Board believes that the expected strong Events performance and robustness in the rest of the Group's business, as outlined in the Interim Results, will not now be enough to offset the weak trading in the US. As a result, the Board, having expected revenue of approximately £15.5 million and EBITDA of £0.3 million for the year ending 31 December 2022 ("FY2022"), now expects that the Company will report revenue of approximately £15.0 million and an EBITDA loss of approximately £(0.35) million for FY2022. The US business' team has been re-built materially this year and the Board remains confident of the quality of the InvestmentNews brand and its potential.

Following the fundraising earlier in the year and the disposal of its Business Solutions and Governance (BSG) division in August 2022, the Group has continued to invest in new technology platforms and completed the restructuring of its central support functions (including technology, finance, marketing and human resources). The significant savings from these areas, amounting to an expected minimum of £0.7 million, will not be fully realised until FY 2023. The Board continues to seek to identify and act upon additional cost savings where appropriate.

Loan Facility

The Company continues to manage its cash and working capital well and, as at 30 September 2022, had a cash position of £1.0 million and net debt, including leases of £2.6 million, totalling £1.7 million.

Given the challenging macro-economic situation, the Company has, as a precautionary measure, entered into a standby loan facility with Rockwood Strategic Plc ("Rockwood"), its largest shareholder, managed by Harwood Capital LLP ("Harwood") to provide up to £800,000 in cash at a monthly compound interest rate of 2% on funds drawn down, which will be capitalised ("Loan Facility"). The Loan Facility, which runs to 1 May 2023, has an arrangement fee of 5%, may be drawn down in tranches of £200,000 and will be used for working capital purposes. The Board does not anticipate that the Company should need to draw down on part of the Loan Facility until February 2023 at the earliest.

Rockwood Strategic Plc is a substantial shareholder of the Company and a related party under the AIM Rules for Companies (the "AIM Rules"). The provision of the Loan Facility by Rockwood to the Company constitutes a related party transaction (the "Transaction") under the AIM Rules. The independent Directors of the Company, being all of the Directors other than Richard Staveley, who is an appointee of Harwood, having consulted with the Company's nominated adviser, Shore Capital and Corporate Limited, consider that the terms of the Loan Facility are fair and reasonable insofar as the Company's shareholders are concerned.

Strategic Review and Formal Sale Process

Following discussions with certain of the Company's major shareholders, the Board has decided to undertake a strategic review, which may or may not result in the sale of the Group as a whole or of either of the Company's principal trading businesses, InvestmentNews in the US or Bonhill in the UK and Asia.

Bonhill is subject to the City Code on Takeovers and Mergers (the "Takeover Code"). One of the options that will be considered is a potential sale of the Group, therefore, the Company is launching a "formal sale process" (as referred to in Note 2 on Rule 2.6 of the Takeover Code). The Takeover Panel has agreed that any discussions with third parties may be conducted within the context of a formal sale process under the Takeover Code, which will enable conversations with parties interested in making a proposal to take place on a confidential basis.

Parties interested in submitting any expression of interest, should contact Shore Capital and Corporate Limited ("Shore Capital") or Patrick Ponsford, Group CEO, on the contact details set out below. It is currently expected that any party interested in submitting any form of proposal for consideration within the strategic review (including within the formal sale process) will, at the appropriate time, enter into a non-disclosure agreement and standstill arrangement with the Company on terms satisfactory to the Board and on the same terms, in all material respects, as other interested parties before being permitted to participate in the process. The Group then intends to provide such interested parties with certain information on its business, following which interested parties shall be invited to submit their proposals to Shore Capital. The Group will update the market in due course regarding timings for the formal sale process.

The Board reserves the right to alter any aspect of the process as outlined above or to terminate the process at any time and, in such cases, will make an announcement as appropriate.  The Board also reserves the right to reject any approach or terminate discussions with any interested party at any time.

The Group is not in receipt of any approach, nor in discussions with any potential offeror, at the time of this announcement.

The Takeover Panel has granted a dispensation from the requirements of Rules 2.4(a), 2.4(b) and 2.6(a) of the Takeover Code such that any interested party participating in the formal sale process will not be required to be publicly identified as a result of this announcement and will not be subject to the 28 day deadline referred to in Rule 2.6(a) of the Takeover Code for so long as it is participating in the formal sale process. Following this announcement, the Company is now considered to be in an "offer period" as defined in the Takeover Code, and the dealing disclosure requirements as set out below will apply.

Shareholders are advised that this announcement does not represent a firm intention by any party to make an offer under Rule 2.7 of the Takeover Code and there can be no certainty that any offers will be made as a result of the formal sale process, that any sale or other transaction will be concluded, nor as to the terms on which any offer or other transaction may be made.

For further enquiries please contact:

Bonhill Group plc  

Jonathan Glasspool, Non-executive Chairman  [phone]

Patrick Ponsford, Group CEO  [phone]

Shore Capital (Nominated Adviser and Broker)          [phone]

Tom Griffiths/David Coaten

About Bonhill Group plc

Bonhill Group plc is a leading, AIM-quoted, B2B media company providing Business Information, Events and Data & Insight propositions to the global Financial Services community. Bonhill operates multiple digital platforms, has market leading media brands, hosts over 100 events per annum, offers a portfolio of data & analytics propositions and provides a range of content marketing solutions.

Bonhill operates exclusively in the financial services space where its brands and services are acknowledged as market leaders. It specialises in enhancing the relationship and flow of information between the global community of financial services providers and the advisers who recommend their products. Bonhill was early to recognise the growing importance of ESG in asset allocation and fund selection and now owns the leading global platform in this space, serving the adviser community.

Flagship brands include: InvestmentNews, ESG Clarity, Portfolio Adviser, Fund Selector Asia, Expert Investor Europe, UK Adviser and International Adviser.

Offices in New York, London, Singapore and Hong Kong.

For more information visit www.bonhillplc.com .

IMPORTANT NOTICES

Shore Capital and Corporate Limited is authorised and regulated in the United Kingdom by the Financial Conduct Authority ("FCA") and is acting exclusively as Nominated Adviser and Broker and for no one else in connection with the subject matter of this announcement and will not be responsible to anyone other than Bonhill for providing the protections afforded to its clients nor for providing advice in relation to the subject matter of this announcement.

This announcement is not intended to, and does not, constitute or form part of any offer, invitation or the solicitation of an offer to purchase, otherwise acquire, subscribe for, sell or otherwise dispose of, any securities whether pursuant to this announcement or otherwise.

This announcement (including any information incorporated by reference in this announcement), oral statements made regarding the formal sale process, and other information published by the Group contain statements about the Group that are or may be deemed to be forward looking statements. Without limitation, any statements preceded or followed by or that include the words "targets", "plans", "believes", "expects", "aims", "intends", "will", "may", "anticipates", "estimates", "projects" or words or terms of similar substance or the negative thereof, may be forward looking statements.

These forward-looking statements are not guarantees of future performance. Such forward-looking statements involve known and unknown risks and uncertainties that could significantly affect expected results and are based on certain key assumptions. Many factors could cause actual results to differ materially from those projected or implied in any forward-looking statements. Due to such uncertainties and risks, readers should not rely on such forward-looking statements, which speak only as of the date of this announcement. The Group disclaims any obligation or responsibility to update publicly or review any forward-looking or other statements contained in this announcement, except as required by applicable law.

The distribution of this announcement in jurisdictions outside the United Kingdom may be restricted by law and therefore persons into whose possession this announcement comes should inform themselves about, and observe, such restrictions. Any failure to comply with the restrictions may constitute a violation of the securities law of any such jurisdiction.

Disclosure requirements of the Takeover Code

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) 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 [phone] if you are in any doubt as to whether you are required to make an Opening Position Disclosure or a Dealing Disclosure.

Rule 2.9 disclosure

In accordance with Rule 2.9 of the Takeover Code, the Company confirms that it has 119,288,687 ordinary shares of £0.01 each in the Company in issue. The International Securities Identification Number (ISIN) reference for these securities is GB00BFWYSS80. The Group holds no ordinary shares in treasury.

Publication on website

A copy of this announcement will be made available, subject to certain restrictions relating to persons resident in restricted jurisdictions, on the Group's website at www.bonhillplc.com by no later than 12 noon (London time) on the business day following the date of this announcement. Neither the content of any website referred to in this announcement nor the content of any website accessible from hyperlinks is incorporated into, or forms part of, this announcement.

 

END

 

 

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