Rights Issue & Agreement with Lenders

RNS Number : 2476M

Hyve Group PLC

07 May 2020

 

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THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION FOR THE PURPOSES OF ARTICLE 7 OF REGULATION 2014/596/EU. IN ADDITION, MARKET SOUNDINGS WERE TAKEN IN RESPECT OF THE MATTERS CONTAINED IN THIS ANNOUNCEMENT, WITH THE RESULT THAT CERTAIN PERSONS BECAME AWARE OF SUCH INSIDE INFORMATION. UPON THE PUBLICATION OF THIS ANNOUNCEMENT, THIS INSIDE INFORMATION IS NOW CONSIDERED TO BE IN THE PUBLIC DOMAIN AND SUCH PERSONS SHALL THEREFORE CEASE TO BE IN POSSESSION OF INSIDE INFORMATION.PLEASE SEE THE IMPORTANT NOTICE AT THE END OF THIS ANNOUNCEMENT.

For immediate release

7 May 2020

Hyve Group plc

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

Underwritten £127 million Rights Issue, Covenant Waivers and Term Loan Repayment Deferrals, and Proposed Share Consolidation

The Company today announces the following measures as part of its decisive response to the outbreak of COVID-19 ("Outbreak"), to secure the future of the business and to position the Group for market leadership and growth:

·	A fully underwritten rights issue to raise approximately £126.6 million (before expenses) (the "Rights Issue")
·	A n agreement with the Group's lending banks to waive financial covenants up to and including March 2022 (subject to inclusion of a basic liquidity test)
·	Additional liquidity through the agreement with the lending banks to defer loan amortisation payments of £35 million until maturity in December 2023

The agreement with the banks is conditional on completion of the Rights Issue. The Company also announces a proposed 10 for 1 share consolidation (the "Share Consolidation").

The Board believes that the Rights Issue and the Share Consolidation are in the best interests of the Company and the Shareholders as a whole. Each of the Directors who is a Shareholder intends to take up in full his or her rights to subscribe for New Ordinary Shares under the Rights Issue in respect of his or her holdings.

A prospectus and circular (the "Prospectus") containing full details of the Rights Issue and Share Consolidation is expected to be made available on Hyve's website ( http://www.hyve.group ) later today, subject to approval by the Financial Conduct Authority. The Rights Issue will be made on the terms, and subject to the conditions, set out in the Prospectus.

Decisive response to the Outbreak: "Protect and Prosper"

The Group delivered a strong performance in Q1 of the current financial year driven by Africa Oil Week and YugAgro   which both delivered double-digit growth on a like-for-like basis, as well as a successful ChinaCoat   event in Shanghai, run in collaboration with its joint venture partner. The Group's performance in H1 included strong year-on-year growth at Mining Indaba and Bett, but was impacted by the measures announced by governments and authorities to combat the spread of the Outbreak.

The Company undertook decisive action to address the challenges of the Outbreak and initiated its response plan, building on the strong platform in place prior to the Outbreak:

·	Events Postponement Plan - 48 events postponed; 13 events cancelled; under continuous review
·	Identified cost savings of c. £10 million in FY 2020 and c. £42 million in FY 2021
·	Stress tested to assess potential impact with a key assumption that none of the Group's events take place until 1 January 2021 (other than a small number of events in China)
·	Proposed equity fundraise of £126.6 million through fully underwritten rights issue
·	Waivers to leverage and interest cover covenants up to and including March 2022 (subject to the inclusion of a liquidity test) as well as additional liquidity through deferral of loan amortisation payments agreed with lenders; conditional on completion of the Rights Issue

The Directors believe that the fundamentals of the business remain strong and that, following the successful conclusion of the Rights Issue, the Group remains well positioned for growth in the future.

Details of the Rights Issue, Covenant Waiver and Repayment Deferral Agreement and Share Consolidation

·	Proposed consolidation of every 10 Existing Ordinary Shares into 1 Consolidated Ordinary Share
·	Fully underwritten rights issue of up to 9 New Ordinary Shares at 69 pence each for every 40 Existing Ordinary Shares, equivalent to 9 New Ordinary Shares at 69 pence each for every 4 Consolidated Ordinary Shares, to raise gross proceeds of approximately £126.6 million (approximately £116.8 million net of expenses)
·	The issue price of 69 pence per New Ordinary Share represents: o  a discount of approximately 67.8% to the Closing Price on 6 May 2020 (being the last Business Day prior to the date of this announcement) and adjusted for the proposed Share Consolidation; and o  a discount of approximately 39.0% to the theoretical ex-rights price of 113.1 pence per New Ordinary Share calculated by reference to the Closing Price on the same basis and adjusted for the proposed Share Consolidation
·	The New Ordinary Shares will represent approximately 225.0% of the Company's Consolidated Ordinary Shares that will be in issue immediately following the Share Consolidation  and approximately 69.2% of the enlarged share capital following completion of the Rights Issue (and following the proposed Share Consolidation)
·	Proceeds to be used to reduce net indebtedness and provide working capital flexibility to the Group to allow it to protect the value of its Core Events
·	The Rights Issue, which is subject to shareholder approval at a General Meeting on 27 May 2020, is fully underwritten by Numis (Corporate Broker), Barclays and HSBC on the terms of the underwriting agreement (the "Underwriting Agreement")
·	RWC European Focus Fund (the Company's largest shareholder) who currently represents approximately 12.5% of the outstanding Existing Ordinary Shares has confirmed that it is fully supportive of the Company's strategy and fundraising proposals and is intending to vote in favour of the Resolutions to be proposed at the General Meeting to approve the Rights Issue
·	Agreement to waive financial covenant tests up to and including March 2022 (subject to the inclusion of a basic liquidity test), conditional upon completion of the Rights Issue   1
·	Secured £35 million of additional liquidity through the deferral of two term loan amortisation payments of £17.5 million each under the Group's banking facilities scheduled for November 2020 and 2021 until maturity, subject to completion of the Rights Issue
·	The Share Consolidation is proposed in order to achieve a higher market price for the Consolidated Ordinary Shares and, accordingly, a more appropriate Issue Price in the Rights Issue

Background and reasons for the Rights Issue

·	Postponement of a significant number of events and the cancellation of other events as a result of the Outbreak has had a material adverse impact on the financial position of the Group
·	The Company is not aware of the full extent of the Outbreak for the current financial year, but based on its Postponement Plan, estimates an adverse impact of approximately £80m on FY20 revenue; under this scenario FY20 revenue estimated to be c. 20% below FY19
·	Due to the possibility of a prolonged period of extensive disruption to the events industry across multiple geographies, the Board carried out stress testing in order to ascertain the liquidity requirements of the business over the near and medium term. o  A key assumption underpinning this reasonable worst case is that none of the Group's events take place until 1 January 2021 (with the exception of a small number of events in China) and that the global economic backdrop will take some time to stabilise and sales cycles will be reduced o  Under this reasonable worst case scenario, revenue for FY20 revenue would be c. 55% below FY19 and c. 60% below FY20 pre-Outbreak expectations; FY21 revenue would be c. 10% below FY19 and c. 30% below FY21 pre-Outbreak expectations
·	Although the length and extent of the business disruption arising from the Outbreak cannot be definitively gauged at this stage, the Directors believe that an equity fundraise of £126.6 million (gross) will provide sufficient working capital to allow the Company to weather this period of disruption. As at 31 March 2020, the Group's adjusted net debt was £157.2 million relative to total committed facilities of £250 million. The Company requires additional liquidity prior to September 2020
·	Management currently expect that the disruption caused by the Outbreak may begin to normalise in the coming months, as evidenced in the scheduled resumption of certain trade events in China from May onwards (which are not organised by the Group), however, the Directors have considered it prudent to ensure contingency for a prolonged period of disruption as envisaged by its reasonable worst case scenario
·	The Rights Issue will give the Group the time and flexibility to overcome the challenges posed by the Outbreak even under the reasonable worst-case scenario and the Directors believe, will set the business on a firm footing for the future as the global economy and its markets recover. The Rights Issue is expected to reduce the Group's indebtedness and the Directors would expect the net debt to 12 month forward looking EBITDA ratio to return to below 2x by December 2021
·	The Company has consulted with a number of its major shareholders ahead of the release of this announcement, including the rationale for the Rights Issue and its structure

Summary of H1 results

·	Revenue of £96.3m with results impacted by the escalation of the Outbreak and various consequential restrictions impose by governments and authorities on large gatherings
·	Revenue increased by 1% on a like-for-like basis, and by 3% including when adjusted to include biennials and timing differences, includes the results of biennial events and those events that ran in the current period but did not run in the comparative period due to changes in event dates, in comparison to the previous edition of the relevant events
·	Headline profit before tax of £19.8m, with the result adversely impacted by event postponements and cancellations
·	Statutory loss before tax of £168.3m after non-cash impairment charges of £166.8m recognised primarily in respect of the UK business as a result of the Outbreak
·	Dividends suspended and future dividends will be kept under review and subject to bank waiver restrictions
·	Acquisition of Shoptalk and Groceryshop completed in December 2019, two US-based market-leading events focused on e-commerce and online grocery subsectors. Shoptalk did not take place in the period due to the outbreak and Groceryshop has been cancelled this financial year, with the next iteration of that event to be run in FY21
·	Hyve's interim results for the six months to 31 March 2020 have been released today in a separate announcement

1 Waiver introduces new interest rate ratchet for as long as net debt:EBITDA remains above 3 times, reverting to standard interest rates once the ratio falls below 3 times

Mark Shashoua, Chief Executive Officer, said:

"We started this year in a very strong position. We reported good like-for-like growth in Q1 and added two market-leading products, Shoptalk and Groceryshop to our portfolio.

When the pandemic began, we initiated Hyve's immediate response to COVID-19. We responded rapidly and decisively by rescheduling events, reducing our costs, managing cash and supporting our customers and people through this crisis. In these unprecedented circumstances we believe we have done everything we can and have taken action at pace to protect the business. Today we have strengthened our financial position through a £126.6m fully underwritten rights issue, to provide additional security through this crisis and to support the long-term success of the business.

Market-leading events act as a key trading platform for many industries, governments and regional authorities and we believe will play a vital role in reigniting economies, and we are working closely with customers and industry bodies to make this happen. We have also accelerated our focus on building our omni-channel capabilities driven by the Shoptalk and Groceryshop acquisition. Digital is unlikely to replace face-to-face events, but it complements it with online activity that supports our customers year-round, and maximises the profile of our brands.

Whilst the impact of the temporary measures including lockdowns and restrictions on travel and organised gatherings has been severe, we believe these are short term challenges. Our strategy of building a portfolio of market-leading events and the investment made over the last three years puts us in a strong position and provides a platform for growth as our events catalyse industries and economies as we exit this crisis."

Words and expressions used within this announcement shall, unless otherwise defined or unless the context requires otherwise, have the same meanings as set out in the Prospectus

Indicative abridged timetable

Publication and posting of the Prospectus, notice of General Meeting and Form of Proxy	7 May 2020
Record Date for entitlements under the Rights Issue	6.00 p.m. on 22 May 2020
General Meeting	9.30 a.m. on 27 May 2020
Record Date for the Share Consolidation	6.00 p.m. on 27 May 2020
Admission and dealings in the Consolidated Ordinary Shares commence on the London Stock Exchange	8.00 a.m. on 28 May 2020
Admission and dealings in New Ordinary Shares, nil paid, commence on the London Stock Exchange	8.00 a.m. on 28 May 2020
Latest time and date for acceptance in CREST and payment in full and registration of renounced Provisional Allotment Letters	11.00 a.m. on 11 June 2020
Dealings in the New Ordinary Shares to commence on the London Stock Exchange fully paid	By 8.00 a.m. on 12 June 2020

Note:

(1)	The times and dates set out in the timetable above and referred to throughout this announcement are subject to change, in which event details of the new times and dates will be notified to the Financial Conduct Authority, the London Stock Exchange and, where appropriate, Qualifying Shareholders through a Regulatory Information Service.
(2)	Any reference to a time in this announcement is to time in London, United Kingdom, unless otherwise specified.

Prospectus

·	The Prospectus containing full details of the Rights Issue is expected to be made available on Hyve's website ( http://www.hyve.group ) later today. Neither the content of the Company's website, nor any website accessible by hyperlinks on the Company's website is incorporated in, or forms part of, this announcement.
·	The Prospectus will be submitted to the National Storage Mechanism and will be available for inspection at www.morningstar.co.uk/uk/nsm following publication.

For further information, please contact:

Hyve Group plc	[phone]
Mark Shashoua / Andrew Beach
Numis (Sponsor, Financial Adviser, Corporate Broker, Joint Global Coordinator, Joint Bookrunner & Joint Underwriter)	[phone]
Nick Westlake / Matt Lewis / Hugo Rubinstein / William Baunton
Barclays (Joint Global Coordinator, Joint Bookrunner & Joint Underwriter)	[phone]
Alastair Blackman / Lawrence Jamieson / Ben West / Kunal Bidani
HSBC (Joint Global Coordinator, Joint Bookrunner & Joint Underwriter)	[phone]
Andrea Coda / Sam Hart / Bhavin Dixit /Jonathan Surr
FTI Consulting	[phone]
Charles Palmer / Emma Hall / Chris Birt

Proposed Rights Issue of 9 New Ordinary Shares for every 40 Existing Ordinary Shares at 69 pence per New Ordinary Share (equivalent to 9 New Ordinary Shares for every 4 Consolidated Ordinary Shares) and Consolidation of every 10 Existing Ordinary Shares into 1 Consolidated Ordinary Share

INTRODUCTION

The Board of Hyve announced today that it intends to raise £126.6 million (before expenses) by way of the Rights Issue. The spread of COVID-19 since the initial Outbreak in China in December 2019 and the subsequent global escalation of the crisis has presented the Group with an unprecedented challenge as the restrictions associated with the pandemic have resulted in the postponement and cancellation of a large number of the Group's events. This has consequently had a material impact on the Group's financial position and the Rights Issue announced today is one of the measures being undertaken to strengthen the Group's balance sheet and set the business on firm foundations for the future.

The Rights Issue is being fully underwritten by each of Barclays, HSBC and Numis on, and subject to, the terms of the Underwriting Agreement. The principal terms of the Underwriting Agreement are summarised in paragraph 8.1 of Part X (Additional Information) of the Prospectus. A General Meeting is to be held at the Company's offices at 2 Kingdom Street, London, England, W2 6JG at 9.30 a.m. on Wednesday 27 May 2020 for the purpose of seeking such approvals. A notice convening the General Meeting, at which the Resolutions will be proposed, is set out at the end of the Prospectus. Although Shareholders physical attendance at the General Meeting is not encouraged due to restrictions imposed by the UK Government in light of the spread of COVID-19, it is recommended that Shareholders wishing to vote on the Resolutions complete the Form of Proxy enclosed with the Prospectus and appoint the Chairman of the General Meeting as proxy.

BACKGROUND TO AND REASONS FOR THE RIGHTS ISSUE

Background to the Rights Issue

The Company is a market-leading events business which operates 133 events globally (a small number of which are biennial) and reported revenue and headline operating profit of £220.7 million and £55.8 million, respectively, in FY 2019 (statutory operating profit in FY 2019 being £14.2 million). The Company's results for the FY 2019 period highlighted that the Company was making strong operational and financial progress as it was reaching a successful conclusion of its Transformation and Growth Programme (the "TAG Programme"). The TAG Programme has focused on evolving the Company's strategy towards creating a scalable platform and building a portfolio of content driven, must-attend events aimed at delivering an outstanding experience and return on investment for Hyve's customers.

In December 2019, Hyve completed the acquisitions of Shoptalk and Groceryshop, two US-based market-leading events focused on e-commerce, for a total consideration of c. $145.3 million (£110.1 million based on a conversion rate of £1 to $1.32 as at 18 December 2019), on a cash free, debt free basis. This acquisition was part-funded by a non-pre-emptive placing of Ordinary Shares in the Company alongside a subscription by the founders and other management shareholders of the target as well as from the Group's Facilities. At the time of the acquisition, the Group also refinanced its senior secured term and revolving credit facilities, to increase aggregate commitments to a total of £250 million (comprising a £100 million term loan facility and a £150 million revolving credit facility) with a £50 million incremental facilities accordion option.

On 23 January 2020, the Group published a trading update which confirmed that FY 2020 had begun positively and that trading was in line with management's expectations at that time. Revenue for the first quarter of the year was higher by 18 per cent. against the prior year, and 7 per cent. on a like-for-like basis, although the first quarter of FY 2020 is comparatively small from a revenue perspective (of 127 Group events scheduled for FY 2020, 25 per cent. of such events were held in quarter one, but only three of the Group's top twenty events). That announcement reaffirmed management's confidence in meeting their then expectations for the full year although economic and political uncertainty were cited as potential headwinds. The strong performance in the first quarter of FY 2020 was driven by Africa Oil Week (which recorded double-digit revenue growth for the second year running) and YugAgro (which recorded double-digit revenue growth for the third year running since the implementation of the TAG Programme), as well as a successful ChinaCoat event in Shanghai, run in collaboration with the Group's joint venture partner.

The Outbreak has since negatively impacted economic conditions and customer demand globally. The events industry is experiencing significant and unprecedented disruption across multiple geographies and sectors with the substantial majority of events, from the kind of events the Group offers, to sporting events, cultural and to other large entertainment events, that were scheduled to take place through to the Reference Date, having been cancelled or postponed worldwide, with the potential for further cancellations and postponements over the coming months. Following the Group's announcement of 23 January 2020, the Outbreak, first reported in China in December 2019, continued to escalate. Over the course of late February and early March 2020, it became clear that the spread of the virus would have a material impact on the Group's operations and near-term financial performance as well as the events industry as a whole. The Group's initial response to the crisis was to seek to reschedule its events in Asia to dates later in the current financial year, thereby mitigating any negative impact on financial performance for the year. However, it became apparent as the COVID-19 situation worsened that the impact in those geographies could not be fully mitigated and that the Outbreak was spreading around the world. This rapid spread led to unprecedented and widespread governmental restrictions on freedom of movement, public gatherings and international travel being implemented.

As a result of the changing global situation, on 5 March 2020 the Group announced that as a consequence of the Outbreak and the associated restrictions (i) it had been required to postpone a number of events in Asia (ii) revenue of non-Asian events from Asian exhibitors was lower than previously expected due to travel restrictions and (iii) that its newly acquired events (Shoptalk and Groceryshop) were to be postponed as, due to the impact on key customers and speakers, the Group did not consider that a sufficiently high quality event could have been delivered under those circumstances. The cumulative negative impact on statutory profit before tax of those factors for FY 2020 was estimated at the time to be £16 million to £18 million. At that time, the Group expected all of its other events to proceed as originally scheduled while acknowledging that the situation was evolving on a daily basis and was being kept under constant review.

Following the 5 March 2020 announcement, the Outbreak escalated into a global pandemic leading to unprecedented societal, governmental and personal impacts and restrictions. As a result, the events industry experienced worsening disruption across multiple geographies and sectors, with a significant number of events across the industry cancelled or postponed. Each region in which the Group operates reacted differently at that stage and, in most instances, governments and authorities placed certain restrictions on freedom of movement, travel and on large gatherings in order to contain the spread of the virus. This included, in the case of Shoptalk, disruption caused by the declaration of a state of national emergency by the US President, Donald Trump, and subsequent crisis management measures implemented by the Governor of Nevada, Steve Sisolak, which had the resultant effect of closing the Shoptalk venue. At an organisational level, companies have implemented large scale home working practices and embargoes on business travel both domestically and internationally.

Starting in March 2020, as a result of uncertain impact of the Outbreak on the economy, the Group began experiencing a decline in contractual bookings for upcoming events and a delay in the receipt of payments from customers who had already booked for upcoming events. The postponement and cancellation of certain events in the second quarter of FY 2020 have resulted in the Group's results declining in the six months ended 31 March 2020. On 7 May 2020 the Group reported its unaudited results for the six months ended 31 March 2020 with revenue reported for the period down by 10.7 per cent. to £96.3 million compared to £107.8 million reported for the six months ended 31 March 2019. Headline profit before tax for the six months ended 31 March 2020 was £19.8 million (statutory loss before tax of £168.3 million for the same period) compared to £24.5 million in the six months ended 31 March 2019 (statutory profit before tax of £1.9 million for the same period). On a like-for-like basis revenue grew in HY 2020 by 1.0 per cent. with Mining Indaba and Bett delivering strong year-on-year growth and an improved performance at Spring Fair despite the impact of Brexit and reduced attendance as a result of the Outbreak. In the six months ended 31 March 2020 14 events were postponed or cancelled with an adverse revenue impact in excess of £35 million against expected revenue for the period. The results were adversely impacted by event postponements and cancellations which had a £7.9 million impact on headline profit before tax, most significantly due to the cancellation of MITT, due to take place in Russia in March 2020. The acquired Shoptalk event was also originally due to take place in March 2020 but has been postponed until September 2020 and therefore the results includes £2.8 million of Shoptalk costs but no Shoptalk revenue in the period post-acquisition. Adjusted net debt at 31 March 2020 was £157.2 million.

As a consequence of the escalation of the Outbreak and the various consequential restrictions imposed by governments and authorities on large gatherings, the Group announced on 23 March 2020 that it had put in place a large-scale events postponement plan in many of its markets (the "PostponementPlan"). This followed the implementation or strengthening of restrictive actions by governments in a number of the Group's key geographies including Germany, Russia, Turkey, Ukraine, the UK and the US, in addition to the pre-existing restrictions in China and other parts of Asia. The Group made clear that, should the situation deteriorate further, more events would need to be postponed, potentially even beyond the current financial year. In response to this

unprecedented global challenge to the events industry, the Group further announced that it was to implement significant cost-cutting and cash conservation measures in order to ensure that working capital is managed as effectively as possible. The Group also announced it had entered into preparatory discussions with its lenders in order to obtain its banks' support regarding gaining additional covenant headroom and financial flexibility. The Group's announcement of 8 April 2020 set out that it had received waivers in relation to the covenant tests due to take place on 30 June 2020. It also confirmed that while the second quarter of FY 2020 had been impacted by the restrictions arising from the Outbreak, the Group had successfully run three of its top 10 events during the quarter (Bett UK, Mining Indaba and Spring Fair).

In connection with the Outbreak, the Company entered into the First Waiver Letter on 7 April 2020, pursuant to which the Company was granted a waiver of certain of its obligations in respect of the Facilities, including regarding certain financial covenants tests. The Group has recently also entered into the Second Waiver Letter with its lenders in respect of (among other things, subject to certain conditions, including the successful completion of the Rights Issue) waiving its (i) consolidated total net debt to adjusted EBITDA ratio covenant and (ii) consolidated EBITDA to consolidated net finance charges ratio covenant, in each case, until and including 31 March 2022 (subject to compliance with the liquidity comment described in paragraph 8.2 of Part X (Additional Information) of the Prospectus) and deferring the 30 November 2020 and 30 November 2021 term loan amortisation payments until the scheduled term loan termination date (which is currently 17 December 2023). The interest payable by the Group on the Facilities increased pursuant to the Second Waiver Letter, from 2.65 per cent. per annum to 3.40 per cent. per annum, when the Second Waiver Letter becomes effective (but this may reduce at any time thereafter to 2.90 per cent. per annum (or lower) if (and for such time that) the leverage ratio for the Group reduces to 3.00:1.00 (or lower) for the period set out in the Second Waiver Letter. The Second Waiver Letter will be effective following the successful completion of the Rights Issue, and the principal terms of the Waiver Letters are summarised in paragraph 8.2 of Part X (Additional Information) of the Prospectus.

The Postponement Plan, Event Schedule and Cancellations

As it became clear that the potential implications of the Outbreak were likely to be far reaching across its geographies, the Group acted to implement the Postponement Plan. This has involved regular dialogue with key customers and venue operators to ensure that any postponed events will continue to provide the premium experience that the Group's customers have come to expect once they are held on the new date. The Postponement Plan has also included productive dialogue with many venue owners to rollover certain costs to the new dates for postponed events or, in the case of cancelled events, to the FY 2021 edition. Similarly, although the Group has granted refunds to a certain number of customers in relation to postponed and cancelled events, the Group has had positive conversations with customers in relation to cash already received in relation to those events. The postponement or cancellation of events has not, as of the Reference Date, resulted in any material changes to the Group's future event schedule beyond the current period of disruption and the Directors currently expect that the Group's events in FY 2021 and beyond will run according to their previously envisaged timescales and at the same venues. However, depending on the duration of the restrictions arising from the Outbreak, additional events may be postponed or cancelled, with some events that have been postponed potentially being cancelled (rather than postponed again) as a further postponement would likely bring those events too close to their scheduled FY 2021 editions. The positive dialogue with customers has been demonstrated at a number of the Group's events. For example, following the postponement of Shoptalk from March 2020 to September 2020, 88 per cent. of speakers have re-confirmed their attendance; 83 per cent. of sponsors have rebooked for September 2020 and 73 per cent. of Hosted Retailers and Brands have confirmed attendance in September 2020. Bett Asia, among others, has seen a similarly positive reaction to its postponement with 95 per cent. of event sponsors confirming acceptance of the new date and 95 per cent. of VIP speakers reconfirming attendance, with the venue also agreeing to host the event on the new date at no additional cost.

Prior to the Outbreak, the Group had been scheduled to hold 127 events in FY 2020. As at the Reference Date, as a result of the Outbreak, 48 of those events have been postponed, with 30 of those having been rescheduled to new dates in the current financial year, 18 events having been rescheduled to new dates outside of the current financial year and 13 events having been cancelled outright, with the next iteration of those events now to occur in FY 2021. Further detail of the Group's schedule of events for FY 2020 as at the Reference Date is set out in Appendix II to the Prospectus.

Based on the information available at the Reference Date, the Group has postponed or cancelled, or expects to postpone or cancel, all of the Group's events through to the end of July 2020 (other than one, CWIEME Shanghai, which remains scheduled to take place at the end of July 2020) as well as nine other events that were scheduled for August and September 2020 (including Groceryshop). As at the Reference Date, the Group has cancelled 13 events that had been scheduled to take place during FY 2020, such events having contributed £25 million in FY 2019, excluding Groceryshop which was acquired during FY 2019. As at the Reference Date, the Group has postponed 30 events that had been scheduled to take place in FY 2020 to a later date in FY 2020, and 18 events that had been scheduled to take place in FY 2020 to a date in FY 2021, such events having contributed £34 million and £21 million, respectively, to the Group's revenue in FY 2019, excluding Shoptalk which was acquired during FY 2020.

The Directors expect reduced attendance at, and revenue generated by, events which are held during the remainder of FY 2020 and in FY 2021 relative to the corresponding events in FY 2019, primarily because of travel restrictions, reluctance to travel to other countries or reduced corporate travel budgets which the Directors expect to result in reduced attendance at events by customers who do not live or operate in the country in which the event is held. Whilst the Board cannot be certain of the exact level of reduction in attendance at present, the Directors expect that domestic audiences will recover more quickly than international audiences as people will be more willing to travel to events within their own country and internal domestic restrictions on travel may be eased sooner than the restrictions in place on international travel. In addition, it is likely that, even following the easing of the Outbreak and the lifting of related restrictions, the occurrence of second or subsequent waves of infection or the establishment of "new normal" protocols to fend off infection, requiring social distancing in air and other travel and relating to group gatherings would continue to adversely impact attendance at, and revenue generated by, the Group's future events.

Given the operational demands of the Group's events and the commercial landscape required in order to most successfully run an event, if such restrictions are not relaxed in line with the Group's present expectations and the impact of the Outbreak witnessed up to the Reference Date continues or worsens, the Group may need to postpone (likely until FY 2021) or cancel more or potentially all of its remaining events scheduled through the remainder of the current financial year and beyond. As at the date of the Prospectus, the Company is not aware of the full extent of the financial impact of the Outbreak for the current financial year, given the evolving nature of the issue, but as at the Reference Date, the Directors estimate that, there will be an impact of approximately £80 million on revenue for FY 2020 which will therefore likely be approximately 20 per cent. below FY 2019 based on the Postponement Plan. There can be no assurance that these estimates will not be increased or changed in a manner that is adverse to the Group.

Cost savings and cash conservation

Throughout the developing Outbreak, the health and safety of the Group's employees, customers and exhibitors has been the Directors' priority and the Group has followed the advice of the World Health Organization and Public Health England in response to the crisis.

Management actions have also sought to protect the long term future of the business and in particular the Core Events while tightly controlling cash and managing the programme of postponements. The Group has sought to implement these measures as a part of a larger coordinated response to the Outbreak focused across 10 initiatives and business areas (Funding, Venues, Costs and Working Capital, People, Commercial and Sales, Operations, Marketing, Systems, Legal and Communications).

The measures taken to reduce costs and preserve cash include the following:

·	HQ restructuring: a freeze on recruitment has been implemented and the contracts of temporary staff have been terminated. A consultation process in relation to potential redundancies has commenced and is expected to result in further savings from July onwards. The Company has, in seeking additional staff savings in the short term, placed 131 members of full-time staff on a "furlough" arrangement with effect from 4 April 2020 in accordance with the UK Government Coronavirus Job Retention Scheme announced on 26 March 2020. In addition, all Directors and a significant number of key managers have agreed to take a temporary 20 per cent. reduction in salary on a voluntary basis, bonus schemes have been removed and a number of staff are working reduced hours with much of the UK operation (the largest in the Group) moving to a four-day week on a temporary basis starting from May for an initial period of three months;
·	Non-staff savings: a Group wide ban on non-essential travel and conferences; removal of incentives and awards; removal of expenses reimbursement; reduction of internal training initiatives has been implemented;
·	Capital expenditure: a significant reduction of capital expenditure has already been implemented with only essential replacement of assets and equipment now being permitted. This includes a delay to the roll-out of a Group wide ERP System which was the final element of the TAG Programme to be implemented; and
·	Events and venue savings: discussions are on-going with venue operators regarding the potential to roll forward costs associated with cancelled or postponed events. Staff savings as a result of fewer onsite staff and lower requirement for content and other direct event related expenditure are also planned.

The cost-saving programme outlined above is intended to identify and implement up to £10 million of savings in FY 2020 (approximately £9 million of which from HQ restructuring, non-staff savings and venue savings, and approximately £1 million of which from reduced capital expenditure) and £42 million in FY 2021 (approximately £40 million of which from HQ restructuring, non-staff savings and venue savings, and £2 million of which from reduced capital expenditure).

Other management actions

The Group is exploring the implementation and adoption of a variety of strategic and operational measures to ensure that it is well placed to adapt to what will be an altered operating environment for the near term following the lifting of restrictions.

The Group will, in line with its current operating practices, look to establish a new and evolving industry leading best practice operating model across all its market leading shows that are held the period post-Outbreak, with the Group's best practice approach being developed alongside overarching guidance from the World Health Organisation and (in each case) respective local governmental and health advisories. In exploring updated best practice response measures, the Group's primary consideration is the health, safety and wellbeing of all those involved in the running of an event, both attending customers and Group personnel, as well as supporting third parties (such as its venues, contractors and third-party suppliers). Measures being put in place to safeguard the Group's employees include working from home for many teams while for those working in offices self distancing, deep cleaning, provision of hand-sanitisers and masks is being implemented. Management maintains regular and frequent dialogue with employees in order to keep them informed.

Whilst the exact requirements of each event will be considered on a case by case basis depending on the nature and geographical location of that event, the Group will look to standardise its rigorous approach to secure the health and safety of participants, staff and suppliers onsite. Operational matters already under consideration for venues include the staggering of attendance using timebound access slots to ensure control of access and capacity management. The Group is surveying and investigating measures relevant to enhanced hygiene and biosecurity, attendee screening, attendee health verification, socially distant routing in and outside of venue, layout alteration to allow for appropriate distancing for customer engagement (for example in the case of content sessions and the Hosted Buyer Programme), bespoke emergency response protocols and additional sanitary and waste management systems.

These measures will be adapted, in each case, to the event in question having regard to matters such as venue footprint, access and construction, a review of the applicable demographic data available (including attendance split by domestic and international attendees), prevailing guidance from regulatory, advisory and governmental bodies as well as advancement in technological responses between the date of the Prospectus and the date of the event.

In working with its venue partners the Group is exploring an amalgamation of venue specific requirements in its operating procedures to ensure maximum protective coverage for on-site matters including temperature checking, catering, frequent deep cleaning, quality controls check, on site protective clothing and supporting technologies to streamline the same. Consideration will also be given to the enforcement, on-site, of any country specific guidance in place at the relevant time of the event.

The implementation of agreed procedures and protocols adopted by the Group will involve additional staff training in support of those actions, alongside the delivery and monitoring of onsite processes. The Group will, once its responses measures are agreed, ensure a route of communication to its customers in this regard, considering also the need to ensure it supports its attendees with the navigation of any additional travel controls prevailing in territory, such as visa, permit or other certifiable entry requirements as the case may be.

In seeking to be at the forefront of current and future industry responses to the Outbreak the Group is active across a number of industry representative forums and channels. The Group's CEO, Mark Shashoua is an active participant of the UFI CEO Think Tank ("CTT"). The CTT was established by UFI in its capacity as the Global Association of the Exhibition Industry and meets regularly to consider, advance and evolve industry level responses and approaches to a wide variety of matters, with its current agenda being focussed on the impact of and responses to the Outbreak, alongside the consideration of appropriate forms of planning and preparation for the response period thereafter. Mark Shashoua is also a member of the UK Events Industry Leaders Advisory Panel, which is also attended by Nigel Huddleston (UK Government Minister for Tourism at the Department for Digital, Culture, Media and Sport) which met most recently on 29 April 2020 to discuss and respond to Government's economic measures pertaining to the events industry, the challenges the industry was facing and matters of further support needed from Government.

The Group is also represented in both The Association of Exhibition Organisers ("AEO") UK Operations Forum where its representative is the appointed Forum Chairman, and the AEO International Operations Forums. The AEO brings together operations leaders representing many of the main organisers within the events industry, with their current focus being the coordinated and collective response to the challenges posed by the Outbreak at an operations level. The Group will also be represented on the AEO Event Recovery Panel, a special purpose panel currently being established and which will be dedicated to the recommencement of events in the short to medium term, addressing operational matters and producing industry specific best practice and thought leadership.

The Group itself has established a cross-segmental taskforce to co-ordinate and implement its best practice approach to resuming each of its events. The primary objective of the taskforce is to review, refine and approve regional implementation plans which will set out the detailed provisions for running events safely for all attendees. The Group intends to prioritise communicating its recommencement operating plans with customers and strategic partners in order to foster a culture of best practice, compliance and innovation in the response to the resuming its events schedule in FY 2020 and FY 2021.

Dividends

The Board has taken the decision not to pay a dividend for the current financial year, during which it will continue to invest in the Group's Core Events. In addition, the terms of the Second Waiver Letter provide that, whilst the amendments to the Facilities introduced by the Second Waiver Letter are in place, the Company is precluded from paying dividends without obtaining the consent of the majority of the Group's lenders. Following completion of the Rights Issue, the payment of dividends by the Company to its Shareholders will therefore be restricted in accordance with the terms of the Second Waiver Letter. The Group considers such arrangements to be typical in the context of the amendments agreed pursuant to the Second Waiver Letter.

The Board understands the importance of optimising value for Shareholders and it is the Directors' intention to return to paying a dividend once they believe it is financially prudent for the Group to do so, following the Group again becoming compliant with the covenants in the Facilities (prior to their amendment by the Waiver Letters) and having repaid the deferred loan amortisation payments.

Potential government funding

In addition to management action, HM Treasury has announced a package of temporary and targeted measures to support businesses through this period of disruption caused by the Outbreak. The Company is in active discussions in relation to access to these initiatives, including the COVID Corporate Finance Facility ("CCFF"). This facility is designed to support liquidity among larger firms, by providing short term funding to help them to bridge Outbreak-related disruption to their cash flows. The Company has applied for the CCFF and is actively investigating the availability of this and other similar governmental programmes in the UK. There is no certainty that the Company will be successful in securing any funding under the CCFF and, even if successful, there is no way of predicting the actual amount of funding the Company may be able to obtain. If the Company is successful in its application to access the CCFF (or other similar governmental programme), subject to the specific terms offered to the Company in respect its participation in such programme being acceptable, the Company may (subject to the consent of a majority of the Group's lenders under its Facilities Agreement to permit the indebtedness incurred by the Group under the CCFF) elect to access such funding and would use any proceeds for normal working capital requirements.

However, given the uncertainty as to availability, amount, terms and timing of any such funding, for the purpose of the Group's cash flow and working capital forecasting the Directors have assumed that the Company will not receive any funding under the CCFF or similar governmental programmes. Furthermore, the Directors do not expect that any such amounts would be sufficient to enable to the Group to continue as a going concern without receipt of the proceeds from the Rights Issue and without the amendments to be effected by the Second Waiver Letter (such amendments being conditional on completion of the Rights Issue). The Directors believe, therefore, that the receipt of any such funding, or the failure to acquire such funding, is not and will not be material in the context of the Rights Issue and the Group's business, results of operations, financial condition and prospects.

In relation to its the US operations the Group has been considering funding options pursuant to the Coronavirus Aid, Relief, and Economic Security (CARES) Act (the "CARES Act"). On 27 March 2020 the President of the United States signed the CARES Act for the primary purpose of providing emergency financial support for individuals, families, and businesses affected by the Outbreak. For smaller and specially qualified businesses, the Act offers financial assistance via the new Paycheck Protection Program ("PPP"). The PPP provides loans to companies that meet certain specified size requirements ("PPP Loans") pursuant to the terms of the loan at least 75 per cent. of a PPP Loan must be used for payroll costs, with the full PPP Loan (including interest) may be forgivable to the extent used for such payroll costs or mortgage interest, rent and utility payments.

Agreement of covenant waivers and deferral of term loan amortisation

As at 31 March 2020, the Group's net debt was £177.6 million relative to total committed facilities of £250 million. The Group's Facilities currently include, inter alia, a consolidated total net debt to adjusted EBITDA ratio covenant which is tested on a last twelve months basis every 3 months from 30 June 2020 although (subject to certain conditions, including the successful completion of the Rights Issue) this covenant test has been waived until (and including) 31 March 2022, as set out in the Second Waiver Letter. The lending banks and the Group have also agreed (among other things, subject to certain conditions, including the successful completion of the Rights Issue) (a) the suspension of testing of the Group's consolidated EBITDA to consolidated net finance charges ratio covenant until (and including) 31 March 2022, subject to (among other things) the inclusion of a liquidity covenant, and (b) the deferral of the two term loan amortisation payments of £17.5 million each under the Group's banking facilities scheduled for 30 November 2020 and 30 November 2021 until the final term loan repayment date (which is currently scheduled for 17 December 2023) under the Facilities, in each case, as set out in the Second Waiver Letter entered into between the Company and its lenders. Under the terms of the Second Waiver Letter, to the extent that any of the Group's insurance claims under its event cancelation policies in respect of Outbreak related cancelations are successful, the Group will be required to apply the net proceeds of any such successful insurance claim to reduce the Group's bank indebtedness.

The principal terms of the Waiver Letters are summarised in paragraph 8.2 of Part X (Additional Information) of the Prospectus.

Reasons for the Rights Issue

The postponement of a significant number of events, some to dates outside of the current financial year, and the cancellation of other events, including Groceryshop MITT and MosBuild which are among the Group's largest events, has already had a material adverse impact on the financial position of the Group as described in more detail above.

In the context of the Outbreak and the possibility of a prolonged period of extensive disruption to the events industry across multiple geographies, the Board has carried out stress testing in order to ascertain the liquidity requirements of the business over the near and medium term.

Due to the ongoing uncertainty of the situation, this scenario analysis has been based on the Directors' reasonable worst case scenario assumptions. While the length and extent of the business disruption arising from the Outbreak cannot be definitively gauged at this stage, the Directors believe that an equity fundraise of approximately £126.6 million in gross proceeds will provide sufficient working capital to allow the Company to weather this period of disruption.

The quantum of the Rights Issue has been arrived at based on the cash requirement implied by a reasonable worst case scenario which assumes:

·	None of the Group's events take place until 1 January 2021, with the exception of ChinaCoat, its 50 per cent. owned joint venture event due to take place in December 2020, five domestic Chinese events due to take place during summer 2020 and one domestic Chinese event due to take place in November 2020.
·	All other events currently scheduled to take place prior to 30 September 2020 are assumed to be cancelled while events that were originally scheduled to take place, prior to the Outbreak, in the three month period ending 31 December 2020 are postponed until later in FY 2021.
·	As a result, revenue for FY 2020 is expected to be below expectations prior to the Outbreak by approximately 60 per cent. and approximately 55 per cent. below revenue for FY 2019.
·	Revenue for FY 2021 is below expectations prior to the Outbreak by approximately 30 per cent. and below revenue for FY 2019 by approximately 10 per cent., on the assumption that the global economic backdrop will take some time to stabilise and sales cycles will be reduced.

While management currently expects that the disruption caused by the Outbreak may begin to normalise in the coming months, as evidenced in the scheduled resumption of certain trade events in China from the end of April onwards, including the Hunan Auto Show which opened on 30 April, (which is not organised by the Group) and one of the Group's venues in Asia (the Shanghai New International Expo Centre) planning to hold events from July or August, with Italyalso stating that some exhibition venues may reopen from mid-May, the Directors have considered it prudent to ensure contingency for a more prolonged period of disruption as envisaged by the reasonable worst case scenario set out above.

The Rights Issue will give the Group the time and flexibility to overcome the challenges posed by the Outbreak even under the reasonable worst case scenario and the Directors believe, will set the business on a firm footing for the future as the global economy and its markets recover. The Directors believe that the Rights Issue will allow the Group to protect its Core Events, customers, colleagues and communities for the long term, lifting a significant weight of uncertainty from all stakeholders. The Directors continue to believe that the underlying foundations of the business remain strong and that its strategy of focusing on market-leading events is the correct one and that this will be borne out when this unprecedented period passes. The Rights Issue will reduce the Group's indebtedness and the Directors would expect the net debt to 12 month forward looking EBITDA ratio to return to below 2x by December 2021. Following completion of the Rights Issue, pro forma adjusted net debt as at 31 March 2020 would be £40.4 million (excluding lease liabilities).

However, if the Rights Issue were not to proceed, it is likely that the Group will have insufficient working capital to continue trading as a going concern, which will likely result in the appointment of administrators or a liquidator at some point between the failure of the proposed Rights Issue and 30 September 2020, at which point Shareholders would lose all or a significant part of the value of their investment in the Company.

CURRENT TRADING AND PROSPECTS

The recent Outbreak has negatively impacted economic conditions and customer demand globally and, as a result, the Group's operations, financial performance and prospects have been materially negatively affected. The substantial majority of events, from the kind of events the Group offers to sporting and other large entertainment events, that were scheduled to take place through to the Reference Date, having been cancelled or postponed worldwide, with the potential for further cancellations/postponements over the coming months. In March 2020, the Outbreak escalated into a global pandemic leading to unprecedented societal, governmental and personal impacts and restrictions. Each region in which the Group operates reacted differently at that stage and, in most instances, governments and authorities placed certain restrictions on freedom of movement, travel and on large gatherings in order to contain the spread of the virus.

As a consequence of the escalation of the Outbreak and the various consequential restrictions imposed by governments and authorities on large gatherings, the Group put in place a large-scale events Postponement plan in many of its markets. Prior to the Outbreak, the Group had been scheduled to hold 127events in FY 2020. As a result of the Outbreak, as at the Reference Date, 48 of those events have been postponed, with 30 of those having been rescheduled to new dates in the current financial year, 18 events having been rescheduled to new dates outside of the current financial year and 13 events having been cancelled outright, with the next iteration of both those events now to occur in FY 2021. By the beginning of March 2020, the Group had collected approximately 77 per cent. of revenues expected from the 14 postponed or cancelled events that had been scheduled to occur in March 2020 but were postponed or cancelled, but since the Group recognises such revenues only when the event is complete, such revenues have not been reflected in the Group's financial results for the six months ended 31 March 2020, while comparable revenues were reflected in the Group's financial results for the six months ended 31 March 2019. Largely as a result of these postponed and cancelled events, the Group's revenue reported for the six months ended 31 March 2020 decreased by 10.7 per cent. to £96.3 million compared to £107.8 million reported for the six months ended 31 March 2019. The Group reported a statutory loss before tax for the six months ended 31 March 2020 of £168.3 million compared to a statutory profit of £1.9 million reported for the six months ended 31 March 2019, after non-cash impairment charges of £166.8 million. The Group's headline profit before tax for the six months ended 31 March 2020 decreased by 19.2 per cent. to £19.8 million compared to £24.5 million reported for the six months ended 31 March 2019. A list of postponed or cancelled events as at the Reference Date is set out in Part A of Appendix II of the Prospectus.

As at the Reference Date, the restrictions on freedom of movement, travel and on large gatherings placed by governments and authorities across the world continue in many markets where the Group's events are due to be held the current FY 2020. The Group has not postponed or cancelled 15 events which are due to be held in the current FY 2020. However, if such measures continue, the Group expects that it would have to cancel or postpone some or potentially all of such events, which will have an additional material negative impact on its operations and financial results for FY 2020. The Group expects that, without postponing or cancelling the events that remain scheduled to be held in the current FY 2020 under the Postponement Plan, its revenue for FY 2020 will decrease by approximately 20 per cent. compared to the £220.7 million reported for FY 2019. If the Group would have to postpone or cancel its 15 events scheduled to be held in the current FY 2020, it expects that its revenue for FY 2020 will decrease by at least 55 per cent. compared to the £220.7 million reported for FY 2019.

To mitigate the impact of the cancelled and postponed events on the Group's results of operations, the Group has been implementing a number of cost cutting measures, such as commencing a consultation process in relation to potential redundancies, a freeze on recruitment and the termination of the contracts of temporary employees, moving much of the UK workforce to a four day week from May 2020, and postponing capital and operating expenses related to the roll out of the ERP System which was the final element of the TAG Programme to be implemented. The Group's cost-saving programme is intended to identify and implement up to £10 million of savings in FY 2020 (approximately £9 million of which from HQ restructuring, non-staff savings and venue savings, and approximately £1 million of which from reduced capital expenditure) and £42 million in FY 2021 (approximately £40 million of which from HQ restructuring, non-staff savings and venue savings, and £2 million of which from reduced capital expenditure).

Although the Outbreak continues to have a material impact on the events industry as a whole, the Directors believe that face-to-face exhibitions and events will retain their importance as they continue to be central to companies in winning new business, sourcing products, staying up-to-date with industry trends and finding new ideas and innovations as well as to local and regional authorities and governments in generating local economic activity and international trade. The backdrop of the Outbreak is likely to have a significant impact on smaller operators, and the Directors believe that over the long term this will serve to increase the relative attractiveness the Group's market leading events versus second tier events, as customers prioritise attendance at market leading shows which the Directors believe deliver a superior return on investment to customers.

SHARE CONSOLIDATION

The Share Consolidation is proposed in order to achieve a higher market price for the Consolidated Ordinary Shares and, accordingly, a more appropriate Issue Price in the Rights Issue.

The Share Consolidation will comprise a consolidation of the Existing Ordinary Shares under which Shareholders will receive Consolidated Ordinary Shares on the Consolidation Ratio of one Consolidated Ordinary Share in substitution for every ten Existing Ordinary Shares. The nominal value of each New Ordinary Share will be 10 pence. The Consolidated Ordinary Shares arising on implementation of the Consolidation will have the same rights as the Existing Ordinary Shares, including voting, dividend and other rights. The resolutions approved at the annual general meeting of the Company held on 23 January 2020 granting authority to the Directors to allot Ordinary Shares, including on a non pre-emptive basis, are not affected by the Consolidation since the aggregate nominal value of the total issued share capital will remain unchanged following the Consolidation.

The intention is that the market price of a Consolidated Ordinary Share immediately following the implementation of the Share Consolidation should be approximately equal to a multiple of 10 times the market price of an Existing Ordinary Share immediately beforehand. The Consolidation Ratio used for the Share Consolidation has been set by the Directors after consultation with the Joint Underwriters. Existing Shareholders will own the same proportion of the Company as they did immediately prior to the implementation of the Share Consolidation, subject only to fractional roundings.

The Closing Price of each Existing Ordinary Share on 6 May 2020 (being the last Business Day prior to the date of this announcement) was 21.45 pence (as derived from the Daily Official List of London Stock Exchange plc). In accordance with the Consolidation Ratio, the Consolidated Closing Price of each Consolidated Ordinary Share would have been 214.5 pence on that date.

Subject to the pairing of the first Resolution at the General Meeting, the Share Consolidation will be made by reference to holdings of Existing Ordinary Shares on the Company's register of members as at 6.00 p.m. on 27 May 2020 (or such other time or date as the Directors may determine). Holdings of Existing Ordinary Shares in certificated and uncertificated form will be treated as separate holdings for the purpose of calculating entitlements under the Rights Issue. Fractions of New Ordinary Shares will not be allotted to Qualifying Shareholders and fractional entitlements will be rounded down to the nearest whole number of New Ordinary Shares. For the purposes of Share Consolidation, it may be necessary for the Company to issue or repurchase for cancellation up to 9 additional Existing Ordinary Shares so that the number of the Company's Existing Ordinary Shares is exactly divisible by 10.

Any fractional entitlements to Consolidated Ordinary Shares which arise will be aggregated into whole Consolidated Ordinary Shares and sold in the market on behalf of the relevant Shareholders. The total proceeds of the sale (net of expenses) will be paid in due proportion to each of the relevant Shareholders. Any proceeds of sale (net of expenses) to each of the relevant Shareholder(s) of less than £5.00 will be aggregated and will accrue for the benefit of the Company.

It is expected that dealings in the Existing Ordinary Shares will continue until close of business on 27 May 2020 and admission of the Consolidated Ordinary Shares to the premium listing segment of the Official List and to trading on the London Stock Exchange's main market for listed securities will become effective at 8.00 a.m. on 28 May 2020.

SUMMARY OF THE PRINCIPAL TERMS OF THE RIGHTS ISSUE

Pursuant to the Rights Issue, the Company is proposing to raise £126.6 million before expenses and estimated net proceeds of £116.8 million. The Rights Issue is being fully underwritten by the Joint Bookrunners on, and subject to, the terms and conditions of the Underwriting Agreement. A summary of the Underwriting Agreement is set out in paragraph 8.1 of Part X (Additional Information) of the Prospectus. Subject to fulfilment of, among other things, the conditions set out below (and, in the case of Qualifying Non-CREST Shareholders, the Provisional Allotment Letter), the New Ordinary Shares will be offered to Qualifying Shareholders on the following basis:

9 New Ordinary Shares at 69 pence each for every 40 Existing Ordinary Shares

this is equivalent to

9 New Ordinary Shares at 69 pence each for every 4 Consolidated Ordinary Shares

held and registered in the name of each such Qualifying Shareholder on the Rights Issue Record Date (and so in proportion for any other number of Existing Ordinary Shares then held) and otherwise on the terms and conditions set out in the Prospectus.

Qualifying Non-CREST Shareholders with registered addresses in the United States or in any of the other Excluded Territories will not be sent Provisional Allotment Letters and will not have their CREST stock accounts credited with Nil Paid Rights, except where the Company and the Joint Bookrunners are satisfied that such action would not result in the contravention of any registration or other legal or regulatory requirement in such jurisdiction.

Holdings of Existing Ordinary Shares in certificated and uncertificated form will be treated as separate holdings for the purpose of calculating entitlements under the Rights Issue. Fractions of New Ordinary Shares will not be allotted to Qualifying Shareholders and fractional entitlements will be rounded down to the nearest whole number of New Ordinary Shares.

The Issue Price represents a discount of approximately 67.8 per cent. to the Consolidated Closing Price on 6 May 2020 (being the last Business Day prior to the date of the Prospectus) and a 39.0 per cent. discount to the theoretical ex-rights price of 113.1 pence per New Ordinary Share calculated by reference to the Consolidated Closing Price on the same basis. Upon completion of the Rights Issue, the New Ordinary Shares will represent approximately 225.0 per cent. of the Company's Consolidated Ordinary Shares that will be in issue immediately following the Share Consolidation and approximately 69.2 per cent. of the Company's enlarged issued share capital following the Rights Issue. Qualifying Shareholders who do not take up any of their entitlements to New Ordinary Shares will experience dilution of their shareholding by approximately 69.2 per cent. as a result of the Rights Issue. The above calculations assume that no Ordinary Shares are issued as a result of the exercise of any options or awards under the Hyve Share Plans between the Reference Date and the Rights Issue Record Date. The New Ordinary Shares will, when issued and fully paid, rank pari passu with the Consolidated Ordinary Shares and will rank in full for all dividends and distributions thereafter declared, made or paid on the share capital of the Company. The New Ordinary Shares may be held in certificated or uncertificated form.

The Rights Issue is conditional, among other things, upon:

·	the Resolutions being passed by the Shareholders at the General Meeting without material amendment;
·	the Underwriting Agreement becoming or being declared unconditional in all respects (save in respect of Admission) and not having been terminated in accordance with its terms prior to Admission;
·	Admission becoming effective by no later than 8.00 a.m. on 28 May 2020 (or such later time and/ or date as the Company and the Joint Bookrunners may determine).

Accordingly, if any of such conditions are not satisfied, or, if applicable, are not waived, the Rights Issue will not proceed.

Applications will be made for the New Ordinary Shares (nil and fully paid) to be admitted to the premium listing segment of the Official List and to trading on the London Stock Exchange's main market for listed securities, respectively. It is expected that Admission will become effective, and dealings in the New Ordinary Shares, nil paid, will commence, at 8.00 a.m. on 28 May 2020.

The Rights Issue will result in up to 183,550,558 New Ordinary Shares (under ISIN: GB00BKP36R26) being issued (representing, in aggregate, approximately 225.0 per cent. of the Consolidated Ordinary Shares that will be in issue immediately following the Share Consolidation and approximately 69.2 per cent. of the Enlarged Share Capital, immediately following completion of the Rights Issue.

The above calculations assume that no Ordinary Shares are issued as a result of the exercise of any options or awards under the Hyve Share Plans between the Reference Date and Admission.

Some questions and answers, together with details of further terms and conditions of the Rights Issue, including the procedure for acceptance and payment and the procedure in respect of rights not taken up, are set out in Parts II and IV of the Prospectus and, where relevant, will also be set out in the Provisional Allotment Letter.

USE OF PROCEEDS

The Rights Issue is expected to raise, in aggregate, approximately £126.6 million in gross proceeds (approximately £116.8 million net of expenses). The Board intends to use the proceeds to reduce net indebtedness and provide working capital flexibility to the Group to allow it to protect the value of its Core Events which might otherwise be damaged by further cost savings, over and above those measures already being implemented.

DIVIDENDS AND DIVIDEND POLICY

The Board has taken the decision not to pay a dividend for the current financial year, during which it will continue to invest in the Group's Core Events.

In addition, the terms of the Second Waiver Letter provide that, whilst the amendments to the Facilities introduced by the Second Waiver Letter are in place, the Company is precluded from paying dividends without obtaining the consent of the majority of the Group's lenders. Following completion of the Rights Issue, the payment of dividends by the Company to its Shareholders will therefore be restricted in accordance with the terms of the Second Waiver Letter.

The Board understands the importance of optimising value for Shareholders and it is the Directors' intention to return to paying a dividend once they believe it is financially prudent for the Group to do so, following the Group again becoming compliant with the covenants in the Facilities (prior to their amendment by the Waiver Letters) and having repaid the deferred loan amortisation payments.

GENERAL MEETING

A notice convening a general meeting of the Company to be held at 9.30 a.m. on Wednesday 27 May 2020 at the Company's offices at 2 Kingdom Street, London, England, W2 6JG is set out at the end of the Prospectus. A Form of Proxy to be used in connection with the General Meeting will be enclosed with the Prospectus. The purpose of the General Meeting is to seek Shareholders' approval for the following resolutions:

·

First Resolution - Authority to effect the Share Consolidation. The First Resolution is an ordinary resolution authorising the Directors to implement the Share Consolidation under which the Company's Existing Ordinary Shares will be consolidated and re-designated such that Shareholders will receive Consolidated Ordinary Shares on the Consolidation Ratio of one Consolidated Ordinary Share in substitution for every ten Existing Ordinary Shares.

·

Second Resolution - Authority to allot New Ordinary Shares. The Second Resolution is an ordinary resolution authorising the Directors to allot New Ordinary Shares and grant rights in addition to all existing authorities to subscribe for or convert any security into New Ordinary Shares up to a nominal amount of £18,355,056 in connection with the Rights Issue. This authority will expire at the Company's next annual general meeting.

IMPORTANCE OF VOTE

Shareholders are asked to vote in favour of the each of the Resolutions at the General Meeting in order for the Rights Issue to proceed. The Directors believe that the successful completion of the Rights Issue will significantly strengthen the Group's balance sheet, in particular by providing liquidity support during the Outbreak, and this will enable the Group to continue as a going concern.

The Group derives its revenue from the operation of face-to-face events, a material number of which have now been postponed or cancelled as a result of the escalation of the Outbreak and the various consequential restrictions imposed by governments and authorities on large gatherings and this has had a material impact on the Group with the further possibility that more events may be cancelled.

In the event that any of the Resolutions are not passed and the Rights Issue therefore does not proceed, whilst the Directors would expend every effort to obtain alternative sources of funding, at present it is not considered likely that Group would be able to renegotiate the Facilities, obtain an alternate form of funding or effect a sale of the whole or part of the Group's business, on acceptable terms and within the relevant timescales. In addition, the successful completion of the Rights Issue is a condition to the Second Waiver Letter becoming effective (and the Facilities being amended in accordance with its terms). Therefore, if the Resolutions do not pass and the Rights Issue and the Second Waiver Letter do not complete, the Company would likely have insufficient working capital to continue trading as a going concern, which will likely result in appointment of administrators or liquidator at some point between the failure of the proposed Rights Issue and 30 September 2020, at which point Shareholders would lose all or a significant part of the value of their investment in the Company.

Accordingly, the Directors believe that the Share Consolidation and the Rights Issue is in the Shareholders' best interests, and it is very important that Shareholders vote in favour of the Resolutions so that they can proceed.

RWC European Focus Fund (the Company's largest shareholder) who currently represents approximately 12.5% of the outstanding Existing Ordinary Shares has confirmed that it is fully supportive of the Company's strategy and fundraising proposals and is intending to vote in favour of the Resolutions to be proposed at the General Meeting to approve the Rights Issue

RECOMMENDATION AND INTENTIONS OF DIRECTORS

The Board considers the terms of the Share Consolidation and the Rights Issue to be in the best interests of Shareholders taken as a whole. Accordingly, the Board unanimously recommends that Shareholders vote in favour of the Resolutions to be proposed at the General Meeting, as the Directors intend to do in respect of their own beneficial holdings, amounting in aggregate to 2,740,527  Ordinary Shares, which represent approximately 0.336  per cent. of the total voting rights in the Company as at the Reference Date.

All of the Directors who hold Ordinary Shares (Richard Last, Mark Shashoua, Andrew Beach, Sharon Baylay Nicholas Backhouse and Stephen Puckett) intend to take up in full their rights to subscribe for New Ordinary Shares under the Rights Issue in respect of their holdings. Together these amount to rights to subscribe for 616,617 New Ordinary Shares, representing approximately 0.233 per cent. of the Company's issued share capital immediately following completion of the Rights Issue.

HYVE'S STRATEGY & KEY STRENGTHS

The Group has worked intensively over the last three financial years implementing the TAG Programme to fundamentally transform the business into one with a global portfolio of market leading events, leveraging a centralised operating model to deliver a premium product to exhibitors and attendees. This process has been underpinned by the Group's vision to create the world's leading portfolio of content-driven, must-attend events delivering an outstanding experience and return on investment for its customers.

The Group remains focused on market leading events, the application of its centralised operating model and continuous innovation. This is underpinned by the Group's performance-led culture and values. Through the TAG Programme, the Group has invested in its business, resulting in a stronger and more diversified events portfolio. The events portfolio consisted of 130 events with an average revenue per event of £1.7 million as at 30 September 2019 (compared to 269 events and an average revenue per event of £0.5 million as at FY 2017). The Group believes the investment in its business through the implementation of the TAG Programme has resulted in a stronger and more diverse events portfolio with a more balanced geographical footprint. The Group divides its portfolio into Core Events and Non-Core Events, with Core Events being those events which management believe can grow through active investment and become market leading events in line with the underlying strategy of the TAG Programme and Non-Core Events being those events for which performance is largely defined by end market or local conditions and where further investment by the Group would therefore be less likely to deliver a return. For FY 2019, Core Events delivered 91 per cent. (£200.4 million) of total Group revenue.

Although the Outbreak continues to have a material impact on the events industry as a whole, the Directors believe that face-to-face exhibitions and events will retain their importance as they continue to be central to companies in winning new business, sourcing products, staying up-to-date with industry trends and finding new ideas and innovations. The backdrop of the Outbreak is likely to have a significant impact on smaller operators, and the Directors believe that over the long term this will serve to increase the relative attractiveness of its market leading events, versus second tier events, as customers prioritise attendance at market leading shows which the Directors believe deliver a superior return on investment to customers.

In the current financial year, the Group has continued to evolve both through organic initiatives and acquisitions. In December 2019, the Group acquired Shoptalk and Groceryshop which are market leading events in the e-commerce sector based in the United States. In addition to bringing two historically high growth and profitable events into the Group's events portfolio, the acquisition has also given the Group access to their leading Hosted Buyer Programme which has the potential to be rolled out across a number of other Group events.

The Outbreak has had a material impact on the Group's near term operating and financial performance, which the Directors believe is consistent with other operators in the events industry. In light of the current and expected impact of the Outbreak, the Group is implementing a range of cost saving and cash management measures in order to maximise available liquidity, while focusing on protecting the prospects of the Group's leading events. The Directors believe that these measures, together with the completion of the Rights Issue, will allow the Company to respond to the adverse market conditions that it is currently facing and that the platform built by the Group over recent years means that it is strongly positioned for recovery once this period of dislocation has passed and economic and market conditions normalise.

The Directors believe that the key elements of the Company's investment case are:

i.  A centralised, product-led operating model

The Directors believe a centralised product-led operating model allows the Group to operate events to a very high standard across all of its geographies. Global multinational exhibitors often tend to prefer engaging with a single events organiser that can cater for them globally and is able to deliver a consistently high standard of service across all facets of the event experience.

The Group has created best practice functions and teams both centrally in its headquarters and in many of its regions. Investment has been made in event operations for market-leading events which has contributed to delivering three consecutive years of organic growth between FY 2017 and FY 2019. In FY 2019, the Group achieved a significant improvement in its key financial metrics including statutory revenue growth which, in FY 2019, was 26 per cent. (13 per cent. from Top 10 TAG Events) The Group achieved an increase in forward bookings to £152 million as at 30 September 2019 (£147 million as at 30 September 2018) and had an increase in headline profit before tax to £50.4 million for FY 2019 (£35.4 million for FY 2018).

The Group has added to the talent and capability within the business from both the events industry and other sectors and the Regional and Portfolio Directors have been central to creating a culture of high performance, reward and recognition. As the TAG Programme has now largely been completed, the Group now has an updated IT infrastructure, new CRM and HR systems providing one source of data, helping to enable increased transparency and collaboration between the Group's regions and driving standardised best practice globally. The Group has implemented integrated technologies which are suitable for scaling across the Group and employs a cloud first approach and solutions which are applicable for all significant geographies in which the Group operates. The Group's technology architecture has been designed so as to enable the smooth integration of any business acquired by the Group. The final element of the TAG Programme to be implemented is the Group wide roll-out of a new ERP System although this has been delayed as part of the cost saving measures implemented as a result of the impact of the Outbreak.

ii.  A high-quality events portfolio, balanced by geography and sector

The Group has made significant progress in improving the quality of its portfolio to ensure a focus on events that are either market leading or have the potential to become market leading within a particular geography and industry sector. Since it launched the TAG Programme in May 2017 the Group has sold 65 events (56 of which were Non-Core Events in Russia) and closed a further 89 Non-Core Events. This has resulted in a smaller but higher performing portfolio, which for FY 2019 delivered an average of £1.7 million in revenue per event from 129 events held in FY 2019 (compared to £0.5 million average revenue per event from 269 events in FY 2017) reflecting the change in emphasis to larger events that can generate higher revenues and have, until the Outbreak, also reflected sustainable growth.

The benefits of focusing on larger events are demonstrated by the fact that the Top 10 TAG Events had like-for-like revenue growth of 13 per cent. in FY 2019 (compared 7 per cent. for the Group as a whole in the same period) with statutory revenue growth of 26 per cent. in FY 2019 (13 per cent. from Top 10 TAG Events). The Top 10 TAG Events also demonstrated strong revenue growth and improved exhibitor and visitor net promoter scores as a result of customer service initiatives, a focus on high quality content and the establishment of a best practice methodology which has been implemented across multiple events, driving higher volumes of quality leads for the Group's events teams.

The Group's event portfolio is now more balanced in both geographic and sector terms, reflecting the change in focus from events based almost exclusively in emerging markets prior to the implementation of the TAG Programme to an emphasis on market leading events irrespective of geography and sector. Although Russia remains an important geography for the Group, there is now much less reliance on it due to the diversification of the portfolio. The portfolio is now much more diversified in terms of segments and includes events across various geographic locations including the United States, the United Kingdom and Russia. The Directors believe that the geographic diversity of the Group should provide increased resilience to the challenges posed by the Outbreak as there will be some regions in which the Group operates which lift restrictions more quickly than others.

The Group continues to review opportunities relevant to its businesses and portfolio of events, including the consideration of potential disposals of Non-Core Events or Core Events if the Board believes a disposal would be beneficial to the Group and could enable it to strengthen its financial position. For the duration of the amendments to the Facilities introduced by the Waiver Letters, in respect of any future disposal by the Group, the terms of the Waiver Letters will (subject to certain conditions) require the Group to (a) obtain the prior consent of a majority of the Group's lenders to certain such disposal and/or (b) apply certain of the proceeds of such disposal to reduce the Group's bank indebtedness.

iii.  Track record of delivering accretive, product-led acquisitions

In July 2018 the Group acquired Bett, CWIEME, Spring Fair and Autumn Fair, Pure and Glee through the product-led acquisition of Ascential Events. In October 2018, the Group also acquired Mining Indaba. The integration of these acquisitions is now complete, and Bett, CWIEME, Spring Fair, Autumn Fair and Mining Indaba were each in the Group's top ten events by revenue in FY 2019.

In December 2019, the Group acquired Shoptalk and Groceryshop, a product-led acquisition of two market-leading shows focused on the e-commerce and online grocery subsectors for a total consideration of $145.3 million (c. £110.1 million based on a conversion rate of £1 to $1.32 as at 18 December 2019) on a debt free, cash free basis. This product-led acquisition of two market leading US events was consistent with the Group's strategy and enabled the Company to expand its offering in the high growth end markets of e-commerce and online grocery. This acquisition was part-funded by a fully underwritten non pre-emptive placing of Ordinary Shares in the Company alongside a subscription of Ordinary Shares by the founders and certain other management shareholders of Shoptalk and Groceryshop as well as a draw down on the Facilities.

The Group applies a strict criteria and disciplined approach to its identification of potential acquisition targets. Given the current market conditions and the likely negative impact that the Outbreak will have on the Group's results of operations and ability to make any material acquisitions through the end of the current financial year and potentially the next, the Group is likely to be less acquisitive in the near term and the proceeds of the Rights Issue are not currently intended for acquisitions. In addition, for the duration of the amendments to the Facilities introduced by the Waiver Letters, any future third party business acquisitions by the Group will generally (subject to certain conditions) require the prior consent of a majority of the Group's lenders, in accordance with the terms of the Waiver Letters.

Following the resumption of normal market conditions with the passing of the crisis period of the Outbreak, the Directors believe the Group will again look to identify acquisition targets with strong growth prospects.

iv.  Opportunity for innovation and optimisation across the portfolio

The Group's scalable operating model, combined with its selective approach to acquiring best in class events had, until the market was impacted by the Outbreak, opened up a number of incremental growth opportunities. These opportunities, which management expects to reassess in light of market changes. For example, Shoptalk and Groceryshop have developed an industry-leading Hosted Buyer Programme, which is underpinned by bespoke software and includes a platform that facilitates group meetings among customers for the purposes of engaging in conversations in relation to pre-defined topics of mutual interest. Pursuant to the Personatech Licence Agreement, a licence is granted for the use of the Hosted Buyer Programme software at any Hyve event.

In addition to the potential to improve existing events, there are opportunities for taking certain of the Group's leading events to additional locations throughout the year. Examples of this include Bett Asia, CWIEME Shanghai and CWIEME Americas with a significant opportunity for the Shoptalk Europe event going forward, depending on the constraints on Group resources arising as a result of the Outbreak.

The Directors believe that the impact of technology on the events sector will be a prominent feature of market developments in the coming year as improved analytics tools, digital communication and other technologies provide opportunities to increase engagement, drive the creation of better products and advance its content strategy resulting in improved return on investment for customers, an enhanced customer experience and strengthening customer relations. The Group is accelerating its existing plans for an omni-channel strategy with both online and physical events forming part of its offering to customers, to further advance the outstanding experience offered by an event to customers in terms of return on investment and time as a result of their attendance, whether physical, virtual or a combination of both.

The Company has already begun to address the trend of virtual engagement with its customers as seen most recently with the launch of Shoptalk Virtual Events in April 2020. Shoptalk Virtual Events are a new set of products that offer ground-breaking content, connections and community to the entire retail ecosystem. The Group also intends to launch Shoptalk Online later in 2020 with over 10,000 individuals from leading global consumer and technology businesses expressing interest in participating.

·	Shoptalk Virtual Conferences: A series of panels, presentations and interviews that address the most critical challenges and opportunities in retail today. Conferences are conducted via livestream video and organised around a single theme, Shoptalk Virtual Conferences will vary in length but primarily include half- and full-day events. These conferences are open for anyone to register to attend.
·	Shoptalk Virtual Tabletalks: Interactive peer-to-peer 45-minute virtual conversations that enable in depth discussions and briefings based on specific topics. Shoptalk Virtual Tabletalks carefully match up to six individuals from retailers and brands who come together via video conference to share insights, address issues and generate actionable takeaways. Tabletalks are interactive, video-based conversations designed for the purposes of creating new connections. As with those table talks conducted onsite at Shoptalk's in-person events, Shoptalk Virtual Tabletalks are invite-only for retailers and brands. To date, more than 50 Tabletalks have been held with over 200 participants from leading global consumer businesses.
·	Shoptalk Virtual Meetings: Video conference-enabled versions of the Group's Hosted Buyers Programme, Shoptalk Virtual Meetings will also incorporate the many other networking and collaboration initiatives traditionally conducted in connection with Shoptalk's in-person events, creating the ability for individuals throughout the retail industry to engage with each other across a wide range of use cases at scale in distributed and digitally interactive environments.

The Group continues to review its portfolio of events and advance opportunities for technological engagement with its customers over the course of the Outbreak and beyond as well as the advancement of other emergent trends of engagement and innovation.

The Group is also addressing matters of corporate social responsibility both at a corporate and event level, using its events as a platform to advance change in areas of product sustainability and ethics, as seen in the Pure Power of One campaign, which the Group has incorporated into its Pure London and Pure Origin events in 2020 (both of which have now been rescheduled from July to September 2020) and which aims to encourage individuals to take steps towards a more sustainable future in the form of asking them to make individual pledges which are guided by the UN's Global Goal 12 for Responsible Consumption and Production, the advancement of entrepreneurial and industry crossover through the Mining Indaba Young Leaders Programme and sustainability, recycling and community engagement as seen in the Group's innovative recycling initiatives at Turkey build's recycling initiatives.

v.  Consistent financial performance

Although the ongoing Outbreak has had, and is expected to continue to have, a material adverse impact on the Group's current trading and near term financial performance, the Group has historically delivered consistent revenue growth over the previous three financial years. Prior to the Outbreak, the Group had been consistently cash generative, and it had a headline operating profit margin of 25 per cent. for FY 2019 (FY 2018: 22 per cent.).

Over the previous three year implementation of the TAG Programme, the Group improved its financial performance as well as certain of its key indicators of operational delivery as set out in the table below:

	For the six months ended 31 March		For the financial year ended 30 September
	2020	2019
	(unaudited)	(unaudited)	2019	2018	2017
Revenue (£m)	96.3	107.8	220.7	175.7	152.6
Headline profit before tax (£m)	19.8	24.5	50.4	35.4	31.6
Like-for-like revenue growth (%)	1.0	6.0	7.3	11.4	5.5
Forward bookings (£m)	172.0	199.9	152	147	98

The Directors believe that the improved financial and operational performance show above was driven to a significant extent by the TAG Programme, although there is no guarantee that the Group will achieve similar results in the future due to the uncertain impact that the Outbreak may have on the Group's business and the wider economy.

IMPORTANT NOTICE 

This announcement has been issued by and is the sole responsibility of the Company. The information contained in this announcement is for background purposes only and does not purport to be full or complete. No reliance may or should be placed by any person for any purpose whatsoever on  the  information  contained  in  this  announcement  or  on  its  accuracy  or completeness. The information in this announcement is subject to change.

This announcement is an advertisement and not a prospectus and not an offer of Nil Paid Rights, Fully Paid Rights or New Ordinary Shares for sale in any jurisdiction, including in or into the United States, Australia, Canada, Japan, South Africa, New Zealand and any other jurisdiction where the extension or availability of the Rights Issue (and any other transaction contemplated thereby) would breach any applicable law (each an "Excluded Territory").

Neither this announcement nor anything contained in it shall form the basis of,  or  be  relied  upon  in  connection  with,  any  offer  or  commitment whatsoever  in  any  jurisdiction.  Investors should not acquire any Nil Paid

Rights,  Fully  Paid  Rights  or  New  Ordinary  Shares  referred  to  in  this announcement  except  on  the  basis  of  the  information  contained  in  the Prospectus to be published by the Company in connection with the Rights Issue.

The Prospectus will be available on the Company's website at www.Hyve.group later today. Neither the content of the  Company's  website  nor  any  website  accessible  by  hyperlinks  on  the Company's website is incorporated in, or forms part of, this announcement.

The  distribution  of  this  announcement,  the  Prospectus,  any other offering or public material relating to the Rights Issue and/or the Provisional Allotment Letter and/or the transfer of Nil Paid Rights, Fully Paid Rights and/or New Ordinary Shares through CREST or otherwise into a jurisdiction other than the United Kingdom may be restricted by law and therefore persons outside of the United Kingdom into whose possession this announcement and/or any accompanying documents come should inform themselves about and observe any such restrictions. In particular, subject to certain exceptions, this announcement and the accompanying documents should not be distributed, forwarded to or transmitted in or into the United States or any of the other Excluded Territories.

Recipients of this announcement and/or the Prospectus should conduct their own investigation, evaluation and analysis of the business, data and property described in this announcement and/or the Prospectus. This announcement does not constitute a recommendation concerning any investor's options with respect to the Rights Issue. The price and value of securities can go down as well as up. Past performance is not a guide to future performance. The contents of this announcement are not to be construed as legal, business, financial or tax advice. Each Shareholder or prospective investor should consult his, her or its own legal adviser, business adviser, financial adviser or tax adviser for legal, financial, business or tax advice.

This announcement is not and does not contain an offer of securities for sale or a solicitation of an offer to purchase or subscribe for securities in the United States or any other Excluded Territory, or any other state or jurisdiction in which such release, publication or distribution would be unlawful. The securities to which this announcement relates (the "Securities") have not been and will not be registered under the U.S. Securities Act of 1933, as amended (the "US Securities Act"), or under any securities laws of any state or other jurisdiction of the United States and may not be offered, sold, taken up, exercised, resold, renounced, transferred or delivered, directly or indirectly, in the United States except pursuant to an applicable exemption from, or in a transaction not subject to, the registration requirements of the US Securities Act and in compliance with any applicable securities laws of any state or other jurisdiction of the United States. Subject to certain exceptions, the Securities may not be offered or sold in any other Excluded Territory or to, or for the account or benefit of, any national, resident or citizen of such countries.

Accordingly, subject to certain exceptions, the Rights Issue is not being made in the United States and neither this announcement, the Prospectus nor the Provisional Allotment Letters constitute or will constitute an offer, or an invitation to apply for, or an offer or an invitation to subscribe for or acquire any Nil Paid Rights, Fully Paid Rights or New Ordinary Shares in the United States. Subject to certain limited exceptions, Provisional Allotment Letters have not been, and will not be, sent to, and Nil Paid Rights have not been, and will not be, credited to the CREST account of, any Qualifying Shareholder with a registered address in or that is located in the United States.

The information in this announcement may not be forwarded or distributed to any other person and may not be reproduced in any manner whatsoever. This announcement should not be distributed, forwarded to or transmitted in or into any jurisdiction where to do so might constitute a violation of local securities laws or regulations, including but not limited to (subject to certain exceptions) the United States and any of the other Excluded Territories.

This announcement shall not constitute an offer to sell or the solicitation of an offer to buy any securities, nor will there be any sale of these securities (subject to certain exceptions), in Canada.  In Canada, no prospectus has been filed with any securities commission or similar regulatory authority in respect of the Securities. No such securities commission or similar regulatory authority in Canada has reviewed or in any way passed upon the merits of any proposed offering of the Securities and any representation to the contrary is an offence.

In Canada. the Securities may be sold only to purchasers purchasing, or deemed to be purchasing, as principal that are accredited investors, as defined in National Instrument 45-106 Prospectus Exemptions or, in Ontario, subsection 73.3(1) of the Securities Act (Ontario), and are permitted clients, as defined in National Instrument 31-103 Registration Requirements, Exemptions and Ongoing Registrant Obligations. Any resale of the Securities must be made in accordance with an exemption from, or in a transaction not subject to, the prospectus requirements of applicable securities laws.

Each of Numis, which is authorised and regulated in the United Kingdom by the FCA, and HSBC and Barclays which are authorised by the Prudential  Regulation  Authority  (PRA)  and  regulated  in  the  United Kingdom  by  the  PRA  and  FCA, are acting exclusively for the Company and no one else in connection with the Rights Issue and will not regard anyone (whether or not a recipient of this announcement) other than the Company as their respective clients in relation to the Rights Issue and will not be responsible to anyone other than the Company for providing the protections afforded to their respective clients nor for providing advice in connection with the Rights Issue, or any other matter referred to in this announcement.

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In connection with the proposed Rights Issue, the Joint Bookrunners and any of their affiliates, may in accordance with applicable legal and regulatory provisions, engage in transactions in relation to the Nil Paid Rights, the Fully Paid Rights, the New Ordinary Shares and/or related instruments for their own account for the purpose of hedging their underwriting exposure or otherwise. Accordingly, references in the Prospectus to the Nil Paid Rights, Fully Paid Rights or New Ordinary Shares being issued, offered, subscribed, acquired, placed or otherwise dealt in should be read as including any issue or offer to, or subscription, acquisition, placing or  dealing by Numis, HSBC and Barclays and any of their affiliates acting in such capacity.

The Joint Bookrunners and any of their affiliates may enter into financing arrangements with investors in connection with which he Joint Bookrunners  and any of their affiliates may from time to time acquire, hold or dispose of Ordinary Shares. the Joint Bookrunners  do not intend to disclose the extent of any such investment or transactions otherwise than in accordance with any legal or regulatory obligations to do so.

Further to any contractual obligations that may be in place between the Joint Bookrunners, the Joint Bookrunners and their respective affiliates may, in compliance with applicable law or regulation, for a limited period coordinate further sales of New Ordinary Shares following the transaction.  Except as required by applicable law or regulation, the Joint Bookrunners and their respective affiliates do not propose to make any public disclosure in relation to such transactions.

INFORMATION TO DISTRIBUTORS

Solely for the purposes of the product governance requirements contained within: (a) EU Directive 2014/65/EU on markets in financial instruments, as amended ("MiFID II"); (b) Articles 9 and 10 of Commission Delegated Directive (EU) 2017/593 supplementing MiFID II; and (c) local implementing measures (together, the "MiFID II Product Governance Requirements"), and disclaiming all and any liability, whether arising in tort, contract or otherwise, which any "manufacturer" (for the purposes of the MiFID II Product Governance Requirements) may otherwise have with respect thereto, the Nil Paid Rights, the Fully Paid Rights and the New Ordinary Shares have been subject to a product approval process, which has determined that they each are: (i) compatible with an end target market of retail investors and investors who meet the criteria of professional clients and eligible counterparties, each as defined in MiFID II; and (ii) eligible for distribution through all distribution channels as are permitted by MiFID II (the "Target Market Assessment"). Notwithstanding the Target Market Assessment, Distributors should note that: the price of the Nil Paid Rights, the Fully Paid Rights and/or the New Ordinary Shares may decline and investors could lose all or part of their investment; the New Ordinary Shares offer no guaranteed income and no capital protection; and an investment in the Nil Paid Rights, the Fully Paid Rights and/or the New Ordinary Shares is compatible only with investors who do not need a guaranteed income or capital protection, who (either alone or in conjunction with an appropriate financial or other adviser) are capable of evaluating the merits and risks of such an investment and who have sufficient resources to be able to bear any losses that may result therefrom. The Target Market Assessment is without prejudice to the requirements of any contractual, legal or regulatory selling restrictions in relation to the offer. Furthermore, it is noted that, notwithstanding the Target Market Assessment, the Joint Bookrunners will only procure investors who meet the criteria of professional clients and eligible counterparties. For the avoidance of doubt, the Target Market Assessment does not constitute: (a) an assessment of suitability or appropriateness for the purposes of MiFID II; or (b) a recommendation to any investor or group of investors to invest in, or purchase, or take any other action whatsoever with respect to the Nil Paid Rights, the Fully Paid Rights and/or the New Ordinary Shares. Each distributor is responsible for undertaking its own target market assessment in respect of the Nil Paid Rights, the Fully Paid Rights and/or the New Ordinary Shares and determining appropriate distribution channels.

Forward-looking statements

Nothing in this announcement is, or should be relied on as, a promise or representation as to the future.  Certain information contained in this announcement constitutes "forward ‐ looking statements", which can be identified by the use of terms such as "may", "will", "should", "expect", "anticipate", "project", "estimate", "intend", "continue," "target" or "believe" (or the negatives thereof) or other variations thereon or comparable terminology. Due to various risks and uncertainties, actual events or results or actual performance of the Company may differ materially from any opinions, forecasts or estimates reflected or contemplated in this announcement. There can be no assurance that future results or events will be consistent with any such opinions, forecasts or estimates. Investors should not rely on such forward ‐ looking statements in making their investment decisions. No representation or warranty is made as to the achievement or reasonableness of and no reliance should be placed on such forward ‐ looking statements. The past performance of the Company is not a reliable indication of the future performance of the Company. No statement in this announcement is intended to be nor may it be construed as a profit forecast. Any investment in the Company is speculative, involves a high degree of risk, and could result in the loss of all or substantially all of their investment. Results can be positively or negatively affected by market conditions beyond the control of the Company or any other person.

Neither the Company, Numis, HSBC, Barclays or their affiliates or their respective representatives are under any obligation to keep current the information contained in this announcement.

 

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