Convertible Bond Launch

RNS Number : 5427W

Pennon Group PLC

30 July 2009

 



30 July 2009

Pennon Group Plc

('Pennon')

Pennon launches approximately GBP 120 million offering of Convertible Bonds due 2014

NOT FOR DISTRIBUTION, DIRECTLY OR INDIRECTLY, IN OR INTO THE UNITED STATES, CANADA, JAPAN, AUSTRALIA, JERSEY OR IN ANY OTHER JURISDICTION IN WHICH OFFERS OR SALES WOULD BE PROHIBITED BY APPLICABLE LAW

Pennon announces today that it intends to make an offering (the 'Offering') of approximately GBP 120 million of senior unsecured convertible bonds due 2014 (the 'Convertible Bonds'), which will be convertible into fully paid ordinary shares of Pennon (the 'Shares'). The final size of the Offering will be determined at the time of pricing (which is expected to be later today). 

The Convertible Bonds are expected to carry a coupon of between 4.125% and 5.00% per annum payable semi-annually in arrear, and the conversion price is expected to be set at a premium of between 27% and 32% to the volume weighted average price of the Shares from launch to pricing. The Convertible Bonds will be issued at 100% of their principal amount and, unless previously redeemed, converted or purchased and cancelled, will mature on the fifth anniversary of the issue of the Bonds in 2014. The final terms of the Convertible Bonds are expected to be announced today and closing is expected on or about 20 August 2009. 

The net proceeds of the Offering will be used for general corporate purposes and to refinance acquisitions including London Recycling Limited.

BofA Merrill Lynch and Credit Suisse are acting as Joint Bookrunners and Joint Lead Managers.

Applications will be made for the Convertible Bonds to be admitted to listing on the Official List of the UK Listing Authority and admitted to trading on the Professional Securities Market of the London Stock Exchange.

Enquiries: 

Pennon David Dupont - Group Director of Finance Jo Finely - Investor Relations Manager	[phone] [phone]
BofA Merrill Lynch Richard Taylor Oli Greaves	[phone]
Credit Suisse  Stuart Field  Mark Hammarskjold	[phone]
Finsbury Sally Hogan	[phone]

Terms and Conditions

STABILISATION / FSA

THIS ANNOUNCEMENT IS NOT FOR DISTRIBUTION, DIRECTLY OR INDIRECTLY, IN OR INTO THE UNITED STATES (AS DEFINED IN REGULATION S UNDER THE US SECURITIES ACT OF 1933, AS AMENDED ('REGULATION S'). THIS ANNOUNCEMENT IS NOT AN OFFER TO SELL SECURITIES OR THE SOLICITATION OF ANY OFFER TO BUY CONVERTIBLE BONDS, NOR SHALL THERE BE ANY OFFER OF CONVERTIBLE BONDS IN ANY JURISDICTION IN WHICH SUCH OFFER OR SALE WOULD BE UNLAWFUL. THE CONVERTIBLE BONDS OR OTHER SECURITIES MENTIONED IN THIS ANNOUNCEMENT HAVE NOT BEEN AND WILL NOT BE REGISTERED IN THE UNITED STATES UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED, AND MAY NOT BE OFFERED OR SOLD IN THE UNITED STATES (AS DEFINED IN REGULATION S) ABSENT REGISTRATION OR EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT. THERE WILL BE NO PUBLIC OFFER OF THE CONVERTIBLE BONDS IN THE UNITED STATES. IN ADDITION, THE CONVERTIBLE BONDS ARE SUBJECT TO U.S. TAX LAW REQUIREMENTS AND MAY NOT BE SOLD TO U.S. PERSONS.

THIS ANNOUNCEMENT DOES NOT CONSTITUTE AN OFFER TO SELL OR THE SOLICITATION OF AN OFFER TO BUY ANY CONVERTIBLE BONDS.

THIS ANNOUNCEMENT IS DIRECTED AT AND IS ONLY BEING DISTRIBUTED IN THE UNITED KINGDOM TO (I) PERSONS WHO HAVE PROFESSIONAL EXPERIENCE IN MATTERS RELATING TO INVESTMENTS FALLING WITHIN ARTICLE 19(5) OF THE FINANCIAL SERVICES AND MARKETS ACT 2000 (FINANCIAL PROMOTION) ORDER 2005 (THE 'ORDER'), (II) HIGH NET WORTH ENTITIES, AND OTHER PERSONS TO WHOM IT MAY OTHERWISE LAWFULLY BE COMMUNICATED FALLING WITHIN ARTICLE 49 OF THE ORDER, AND (III) PERSONS TO WHOM IT MAY OTHERWISE LAWFULLY BE COMMUNICATED (ALL SUCH PERSONS TOGETHER BEING REFERRED TO AS 'RELEVANT PERSONS'). THIS ANNOUNCEMENT MUST NOT BE READ, ACTED ON OR RELIED ON BY PERSONS WHO ARE NOT RELEVANT PERSONS. ANY INVESTMENT OR INVESTMENT ACTIVITY TO WHICH THIS ANNOUNCEMENT RELATES IS AVAILABLE ONLY TO RELEVANT PERSONS AND WILL BE ENGAGED IN ONLY WITH RELEVANT PERSONS. BY READING THIS ANNOUNCEMENT, THE READER ACKNOWLEDGES THAT IT IS A PERSON EITHER (I) OUTSIDE THE UNITED KINGDOM OR (II) FALLING WITHIN ONE OF THE FOREGOING CATEGORIES. 

IN MEMBER STATES OF THE EUROPEAN ECONOMIC AREA ('EEA'), THIS ANNOUNCEMENT AND ANY OFFER IF MADE SUBSEQUENTLY IS DIRECTED ONLY AT PERSONS WHO ARE 'QUALIFIED INVESTORS' WITHIN THE MEANING OF ARTICLE 2(1)(E) OF THE DIRECTIVE 2003/71/EC (THE 'PROSPECTUS DIRECTIVE') ('QUALIFIED INVESTORS') AND PURSUANT TO THE RELEVANT IMPLEMENTING RULES AND REGULATIONS ADOPTED BY EACH RELEVANT MEMBER STATE. ANY PERSON IN THE EEA OTHER THAN THE UNITED KINGDOM WHO ACQUIRES THE CONVERTIBLE BONDS IN ANY OFFER (AN 'INVESTOR') OR TO WHOM ANY OFFER OF CONVERTIBLE BONDS IS MADE WILL BE DEEMED TO HAVE REPRESENTED AND AGREED THAT IT IS A 'QUALIFIED INVESTOR', (AS DEFINED ABOVE). ANY INVESTOR WILL ALSO BE DEEMED TO HAVE REPRESENTED AND AGREED THAT (I) ANY CONVERTIBLE BONDS ACQUIRED BY IT IN THE OFFER HAVE NOT BEEN ACQUIRED ON BEHALF OF PERSONS IN THE EEA OTHER THAN QUALIFIED INVESTORS, OR PERSONS IN THE UK AND OTHER MEMBER STATES (WHERE EQUIVALENT LEGISLATION EXISTS) FOR WHOM THE INVESTOR HAS AUTHORITY TO MAKE DECISIONS ON A WHOLLY DISCRETIONARY BASIS AND (II) THE CONVERTIBLE BONDS HAVE NOT BEEN ACQUIRED WITH A VIEW TO THEIR OFFER OR RESALE IN THE EEA TO PERSONS WHERE THIS WOULD RESULT IN A REQUIREMENT FOR PUBLICATION BY THE ISSUER OR THE JOINT LEAD MANAGERS OF A PROSPECTUS PURSUANT TO ARTICLE 3 OF THE PROSPECTUS DIRECTIVE. THE ISSUER, THE JOINT LEAD MANAGERS AND ANY OF THEIR RESPECTIVE AFFILIATES, AND OTHERS, WILL RELY UPON THE TRUTH AND ACCURACY OF THE FOREGOING REPRESENTATIONS AND AGREEMENTS.

THIS ANNOUNCEMENT IS NOT A SUMMARY OF THE OFFERING AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO THE OFFERING CIRCULAR TO BE PREPARED IN CONNECTION WITH THE OFFERING (THE 'OFFERING CIRCULAR'). THIS ANNOUNCEMENT DOES NOT PURPORT TO IDENTIFY OR SUGGEST THE RISKS (DIRECT OR INDIRECT) WHICH MAY BE ASSOCIATED WITH AN INVESTMENT IN THE CONVERTIBLE BONDS. EACH INVESTOR SHOULD READ THE OFFERING CIRCULAR FOR MORE COMPLETE INFORMATION REGARDING THE CONVERTIBLE BONDS BEFORE MAKING AN INVESTMENT DECISION.

THE JOINT LEAD MANAGERS ARE ACTING ON BEHALF OF THE ISSUER AND NO ONE ELSE IN CONNECTION WITH THE CONVERTIBLE BONDS AND WILL NOT BE RESPONSIBLE TO ANY OTHER PERSON FOR PROVIDING THE PROTECTIONS AFFORDED TO CLIENTS OF THE JOINT LEAD MANAGERS, OR FOR PROVIDING ADVICE IN RELATION TO THE CONVERTIBLE BONDS.

NO REPRESENTATION OR WARRANTY, EXPRESS OR IMPLIED, IS OR WILL BE MADE AS TO, OR IN RELATION TO, AND NO RESPONSIBILITY OR LIABILITY IS OR WILL BE ACCEPTED BY THE JOINT LEAD MANAGERS, OR BY ANY OF THEIR AFFILIATES, OFFICERS, EMPLOYEES OR AGENTS AS TO OR IN RELATION TO THE ACCURACY, COMPLETENESS OR VERIFICATION OF THIS ANNOUNCEMENT, THE OFFERING CIRCULAR, PUBLICLY AVAILABLE INFORMATION ON THE ISSUER OR ANY OTHER WRITTEN OR ORAL INFORMATION MADE AVAILABLE TO ANY INTERESTED PARTY OR ITS ADVISERS AND ANY LIABILITY THEREFOR IS HEREBY EXPRESSLY DISCLAIMED.

IN CONNECTION WITH THE OFFERING, THE JOINT LEAD MANAGERS AND THEIR RESPECTIVE AFFILIATES MAY, FOR THEIR OWN ACCOUNT, ENTER INTO ASSET SWAPS, CREDIT DERIVATIVES OR OTHER DERIVATIVE TRANSACTIONS RELATING TO THE CONVERTIBLE BONDS AND/OR THE UNDERLYING ORDINARY SHARES AT THE SAME TIME AS THE OFFER AND SALE OF THE CONVERTIBLE BONDS OR IN SECONDARY MARKET TRANSACTIONS. THE JOINT LEAD MANAGERS AND ANY OF THEIR RESPECTIVE AFFILIATES MAY FROM TIME TO TIME HOLD LONG OR SHORT POSITIONS IN OR BUY AND SELL SUCH SECURITIES OR DERIVATIVES OR THE UNDERLYING ORDINARY SHARES. NO DISCLOSURE WILL BE MADE OF ANY SUCH POSITIONS OTHER THAN AS REQUIRED BY APPLICABLE LAWS AND DIRECTIVES.

IN CONNECTION WITH THE OFFERING, THE JOINT LEAD MANAGERS AND ANY OF THEIR RESPECTIVE AFFILIATES ACTING AS AN INVESTOR FOR THEIR OWN ACCOUNT MAY TAKE UP CONVERTIBLE BONDS OR THE UNDERLYING ORDINARY SHARES AND IN THAT CAPACITY MAY RETAIN, PURCHASE OR SELL FOR THEIR OWN ACCOUNT SUCH SECURITIES AND ANY SECURITIES OF THE ISSUER OR ANY RELATED INVESTMENTS AND MAY OFFER OR SELL SUCH SECURITIES OR OTHER INVESTMENTS OTHERWISE THAN IN CONNECTION WITH THE OFFERING. THE JOINT LEAD MANAGERS DO NOT INTEND TO DISCLOSE THE EXTENT OF ANY SUCH INVESTMENT OR TRANSACTIONS OTHERWISE THAN IN ACCORDANCE WITH ANY LEGAL OR REGULATORY OBLIGATION TO DO SO.

IN CONNECTION WITH THE ISSUE OF THE CONVERTIBLE BONDS, MERRILL LYNCH INTERNATIONAL  (THE 'STABILISING MANAGER') OR ANY PERSON ACTING ON BEHALF OF THE STABILISING MANAGER MAY OVER-ALLOT CONVERTIBLE BONDS OR EFFECT TRANSACTIONS WITH A VIEW TO SUPPORTING THE MARKET PRICE OF THE CONVERTIBLE BONDS AT A LEVEL HIGHER THAN THAT WHICH MIGHT OTHERWISE PREVAIL. HOWEVER, THERE IS NO ASSURANCE THAT THE STABILISING MANAGER (OR ANY PERSONS ACTING ON BEHALF OF THE STABILISING MANAGER) WILL UNDERTAKE STABILISATION ACTION. ANY STABILISATION ACTION IF BEGUN, MAY BE ENDED AT ANY TIME, AND MUST BE BROUGHT TO AN END AFTER A LIMITED PERIOD.

 

END

 

 

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