Tender Offer of ZDP Shares and Notice of EGM

RNS Number : 2214U

GLI Finance Limited

01 April 2021

 

1 April 2021

GLI Finance Limited

(the "Group" or the Company")

Tender Offer for up to 25 per cent. of the issued ZDP Shares

and

Notice of Extraordinary General Meeting and posting of circular

As part of the ZDP Share continuation proposals approved by the Company's shareholders in November 2020, the Board stated that the Company intended to make a cash tender offer for a proportion of the Company's redeemable zero dividend preference shares ("ZDP Shares"). The Board now proposes to implement the Tender Offer for up to 25 per cent of the issued ZDP Shares (excluding ZDP Shares held in treasury) (the "Tender Offer").

The making of the Tender Offer requires the approval of ordinary shareholders at an extraordinary general meeting, to be held at the Company's registered office, Block C, Hirzel Court, Hirzel Street, St Peter Port, Guernsey GY1 2NL, Channel Islands on 22 April 2021 at 10.00 a.m. (the "Extraordinary General Meeting" or "EGM"). A circular (the "Circular") will today be posted to holders of the Company's ordinary shares of no par value ("Ordinary Shares") and ZDP Shares (together the "Shareholders") providing details of the Tender Offer, a notice of the EGM together with the required resolutions, forms of proxy for the attention of ordinary shareholders and tender forms for the attention of ZDP shareholders. The Circular will shortly be available on the Company's website at www.glifinance.com  and Shareholders should consider the full contents of the Circular in addition to the summary information below.

Background to and reasons for the Tender Offer

The Company currently has two classes of Shares in issue: Ordinary Shares and ZDP Shares. As at the date of this announcement, the Company's issued share capital is 489,843,477 Ordinary Shares (of which 11,852,676 are held by a subsidiary of the Company) and 20,791,418 ZDP Shares (of which 12,104,030 are held in treasury).

The ZDP Shares are non-participating and non-voting (except in certain limited circumstances) but carry the right to the repayment of a Final Capital Entitlement on their maturity date of 5 December 2022, on which date the holders of ZDP Shares are entitled to receive from the Company 164.64 pence for each ZDP Share that they hold, which would represent a return on the issue price of the ZDP Shares equivalent to 8 per cent. per annum (which increased from 5.5 per cent. per annum on 6 December 2019).

The Company has, in the past, utilised available cash funds to buy back ZDP Shares with a view to reducing the quantum of the Final Capital Entitlement. ZDP Shares bought back have previously been held by the Company in treasury.  Since the announcement of the extension and other proposals on 17 November 2020, the Company has bought back a further 95,000 ZDP Shares. 

As at the date of this announcement, 8,687,388 ZDP Shares remain in issue and are not held by the Company in treasury, equating to an aggregate Final Capital Entitlement on 5 December 2022 of approximately £14.30 million.

The Tender Offer is being made for up to 2,171,847 ZDP Shares, being 25 per cent. of the issued ZDP Shares as at the date of this announcement (excluding ZDP Shares held in treasury).  Each ZDP Shareholder (other than Restricted Shareholders and certain Overseas Shareholders defined in the Circular) may elect to sell up to 25 per cent. of their ZDP Shareholding. 

The Tender Offer is being made at the Tender Price of 145.59 pence per ZDP Share.  This is equal to the accrued capital entitlement per ZDP Share as at 22 April 2021, the anticipated date of completion of the Tender Offer, calculated in accordance with the Articles. The aggregate Tender Price, assuming that the full entitlement of ZDP Shares is tendered, will be approximately £3.16 million.

The Tender Offer is being made for the benefit of both Ordinary Shareholders, who will benefit from the reduced overall capital entitlement of the ZDP Shares as a result of repurchasing 25 per cent. of the ZDP Shares sooner than their maturity date; and ZDP Shareholders, who may elect to realise some of their investment at this time if they wish to do so.

ZDP Shareholders are not obliged to tender any of their ZDP Shares and, if they do not wish to do so, they should not return a Tender Form or TTE Instruction.

Ordinary Shareholders may not participate in the Tender Offer. 

The Board believes that this proposal is in the interests of all Shareholders and the Company as a whole.

Details of the Tender Offer

Under the terms of the Tender Offer, ZDP Shareholders (other than Restricted Shareholders and certain Overseas Shareholders) will be entitled to tender up to their Tender Entitlement, being 25 per cent. of the ZDP Shares they hold as at the Record Date. Tenders in excess of the Tender Entitlement will not be satisfied.

Subject to the satisfaction of the Conditions relating to the Tender Offer, the Company will purchase ZDP Shares validly tendered under the Tender Offer at the Tender Price by way of an on-market transaction on the main market of the London Stock Exchange.  The ZDP Shares which the Company acquires from tendering ZDP Shareholders will be cancelled. 

The proposed repurchase of ZDP Shares pursuant to the Tender Offer would be categorised as a form of distribution under Guernsey Companies Law. Before the repurchase may be undertaken, the Board must be satisfied, on reasonable grounds, that the Company will satisfy the solvency test as defined under the Guernsey Companies Law immediately after the repurchase has been completed. The Board will also need to consider if the financial position of the Company is expected to, or has, changed materially between the time of the authorisation of the repurchase and the actual time of the repurchase. Currently, the Board is satisfied that the Company will satisfy the solvency test.  However, if the Board ceases to be satisfied prior to completion of the Tender Offer that the Company will satisfy the above-mentioned solvency test immediately after the repurchase by the Company of the ZDP Shares from tendering ZDP Shareholders, then the repurchase will no longer be deemed to be authorised, and as a result, the Tender Offer will not proceed (or be capable of becoming unconditional) and the ZDP Shares will not be repurchased.

ZDP Shareholders should note that, once tendered, ZDP Shares may not be sold, transferred, charged or otherwise disposed of other than in accordance with the Tender Offer.

Shareholders who are in any doubt as to the contents of the Circular or as to the action to be taken should immediately consult their stockbroker, bank manager, solicitor, accountant or other independent financial adviser authorised under FSMA.

The attention of ZDP Shareholders is drawn to Part 4 of the Circular which sets out a general guide to certain aspects of current UK and Guernsey taxation law and HMRC and Revenue Service published practice. This information is a general guide and is not exhaustive. Shareholders who are in any doubt as to their tax position or who are subject to tax in a jurisdiction other than the UK should consult an appropriate professional adviser.

This announcement is not a recommendation for ZDP Shareholders to tender their ZDP Shares under the Tender Offer.  Whether or not ZDP Shareholders tender their ZDP Shares will depend on, amongst other things, their view of the Company's prospects and their own individual circumstances, including their tax position, on which they should seek their own independent advice. 

On 31 March 2021 the Company announced its audited results for the year ended 31 December 2020.  Shareholders may refer to that announcement for the latest financial information on the Company and the Board's present views on the Company's financial and trading prospects.

Expected Timetable of Events

	2021
Publication of the Circular and Tender Offer opens	1 April
Latest time for receipt of Forms of Proxy for the EGM	10.00 a.m. on 20 April
Latest time and date for receipt of Tender Forms and submission of TTE Instructions from Shareholders	10.00 a.m. on 20 April
Record Date and time for the Tender Offer	6.00 p.m. on 20 April
EGM	10.00 a.m. on 22 April
Publication of the results of the EGM and the Tender Offer	Following the EGM on 22 April
Completion of the Tender Offer	Following the EGM on 22 April
CREST settlement date: payments through CREST made and CREST accounts settled	28 April
Balancing share certificates and cheques despatched to certificated ZDP Shareholders	28 April

All of the times and dates in the expected timetable may be extended or brought forward without further notice, at the discretion of the Company.  If any of the above times and/or dates change materially, the revised time(s) and/or date(s) will be notified to Shareholders by an announcement through a Regulatory Information Service provider.

All references to time in this announcement are to UK time.

Capitalised terms used but not otherwise defined in the text of this announcement are defined in the Circular.

For further information, please contact:

GLI Finance Limited

Andy Whelan

[phone]

Liberum Capital (Nominated Adviser and Corporate Broker)

Chris Clarke

Edward Thomas

[phone]

Instinctif Partners (PR Advisor)

Tim Linacre/Lewis Hill

[phone]

LEI: 213800S2XOO3YSEGCA26

 

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