Convertible Bond Offering

RNS Number : 3344H

IWG PLC

02 December 2020

 

NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION IN OR INTO THE UNITED STATES OR IN OR INTO JAPAN, AUSTRALIA, SOUTH AFRICA OR ANY OTHER JURISDICTION IN WHICH OFFERS OR SALES OF THE SECURITIES WOULD BE PROHIBITED BY APPLICABLE LAW

THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION.

For immediate release

2 December 2020

IWG plc

("IWG" or the "Company")

Convertible Bond Offering

IWG (LSE: IWG), the leading global operator of workspace brands, today announces the final terms of its offering (the "Offering") of £350 million of unsubordinated unsecured Guaranteed Convertible Bonds due 2027 (the "Bonds").

The Bonds are expected to be issued by IWG Group Holdings Sarl, a wholly owned indirect subsidiary of the Company incorporated in Luxembourg (the "Issuer") and the Issuer's obligations under the Bonds will be guaranteed by the Company.

The Bonds will be unsubordinated and unsecured obligations of the Issuer and will be subject to a negative pledge in respect of the Issuer, the Guarantor and certain of the Guarantor's other subsidiaries

The Bonds will be issued at par and will carry a coupon of 0.50% per annum payable semi-annually in arrear in equal instalments. The initial conversion price shall be £4.5807, representing a premium of 40% to the volume weighted average price ("VWAP") of an Ordinary Share on the London Stock Exchange between launch and pricing of the Offering today, being £3.2719. The conversion price will be subject to adjustment in certain circumstances in line with market practice. 

Subject to shareholder approval and the Issuer's option to settle conversions in cash, ordinary shares of the Company (the "Ordinary Shares") or a combination thereof, the Bonds will be convertible into Ordinary Shares. The Bonds will be convertible only in limited circumstances prior to 2 June 2021, as described in the terms and conditions of the Bonds.

Toscafund Ltd ("Tosca") is a substantial shareholder of the Company and a related party of the Company for the purposes of the United Kingdom Listing Rules (the "Listing Rules"). Tosca will subscribe for £6.3 million in aggregate principal amount of the Bonds in the Offering at the initial conversion price stated above, representing an aggregate consideration of £6.3 million. As set out in the announcement of the Company on 28 May 2020, Tosca also participated in IWG's equity placing (the "Placing") subscribing for Ordinary Shares for aggregate consideration of approximately £59.4 million. Tosca's aggregated participation in the Offering and the Placing constitutes a smaller related party transaction for the purpose of Listing Rules 11.1.10R.

A smaller related party transaction does not require the approval of independent shareholders of the Company. Tosca's aggregated participation in the Offering and the Placing falls within Listing Rule 11.1.10R (smaller related party transactions) and this announcement is made in accordance with Listing Rule 11.1.10R(2)(c).

The Company will convene an extraordinary general meeting of its shareholders (an "EGM") which is expected to be held on or around 21 December 2020 to seek shareholder approval to allot and issue Ordinary Shares on a non pre-emptive basis for the purpose of settling conversions of the Bonds (the "Shareholder Resolutions"). Notice of the EGM will be sent to IWG shareholders in due course. 

The Issuer may, by giving notice to Bondholders (i) at any time from (but excluding) the date of an EGM to (and including) three London business days following the date of such EGM, if the Shareholder Resolutions have been presented but have not been passed at the EGM and (ii) at any time from (but excluding) 19 May 2021 to (and including) three London business days following 19 May 2021, if the Shareholder Resolutions have been presented and not been passed at a general meeting of IWG shareholders on or before 19 May 2021, redeem the Bonds at the greater of (a) 102% of the principal amount of the Bonds and (b) 102% of the fair bond value (to be determined in accordance with the terms and conditions of the Bonds), in each case with accrued interest.

Settlement and delivery of the Bonds is expected to take place on or about 9 December 2020 (the "Issue Date"). If not previously converted, redeemed or purchased and cancelled, the Bonds will be redeemed at par on 9 December 2027. The Bonds may be redeemed at the option of the Bondholders at par plus accrued interest on 9 December 2025. The Issuer will have the option to redeem all outstanding Bonds on or after 22 January 2025, at par plus accrued interest, if the value of the Ordinary Shares underlying £100,000 in principal amount of the Bonds equals or exceeds £130,000 for at least 20 out of 30 consecutive dealing days, or at any time, if 15% or less of the principal amount of the Bonds remains outstanding.  The final terms of the Bonds are expected to be announced later today.

Application is intended to be made for the Bonds to be admitted to trading on the unregulated open market (Freiverkehr) of the Frankfurt Stock Exchange no later than 60 days after the Issue Date.

Barclays Bank PLC and HSBC Bank plc are acting as Joint Global Coordinators and Joint Bookrunners for the Offering. Investec Bank plc, Bank of China and ING are acting as Co-Managers for the Offering. Rothschild & Co has provided financial advice to IWG in relation to the Offering.

For the purposes of MAR and Article 2 of Commission Implementing Regulation (EU) 2016/1055, the person responsible for releasing this announcement is Tim Regan, Company Secretary of IWG plc .

ENQUIRIES:

IWG plc Mark Dixon, Chief Executive Officer Eric Hageman, Chief Financial Officer Neil Galloway, Executive Vice President Tim Regan, Company Secretary Paul Wilkinson, Group Treasurer Wayne Gerry, Group Investor Relations Director	Tel: [phone]
Barclays Bank PLC (Joint Global Coordinator and Joint Broker) Richard Probert / Tom Macdonald / Omar Alghanim	Tel: [phone]
HSBC Bank plc (Joint Global Coordinator and Joint Broker) Mark Dickenson / Sam McLennan / Ilyas Amlani	Tel: [phone]
Investec Bank plc (Co-Manager and Joint Broker) James Rudd / Alex Wright Rothschild & Co Alex Midgen / Sam Green Brunswick Nick Cosgrove / Oli Sherwood	Tel: [phone] Tel: [phone] Tel: [phone]

IMPORTANT NOTICE IN RELATION TO THE BONDS

NO ACTION HAS BEEN TAKEN BY THE ISSUER, THE GUARANTOR, THE JOINT BOOKRUNNERS AND THE CO-MANAGERS (TOGETHER, THE "MANAGERS") OR ANY OF THEIR RESPECTIVE AFFILIATES THAT WOULD PERMIT AN OFFERING OF THE BONDS OR POSSESSION OR DISTRIBUTION OF THIS PRESS RELEASE OR ANY OFFERING OR PUBLICITY MATERIAL RELATING TO THE BONDS IN ANY JURISDICTION WHERE ACTION FOR THAT PURPOSE IS REQUIRED. PERSONS INTO WHOSE POSSESSION THIS PRESS RELEASE COMES ARE REQUIRED BY THE ISSUER THE GUARANTOR AND THE MANAGERS TO INFORM THEMSELVES ABOUT, AND TO OBSERVE, ANY SUCH RESTRICTIONS.

THIS PRESS RELEASE IS NOT FOR DISTRIBUTION, DIRECTLY OR INDIRECTLY IN OR INTO THE UNITED STATES. THIS PRESS RELEASE IS NOT AN OFFER TO SELL SECURITIES OR THE SOLICITATION OF ANY OFFER TO BUY SECURITIES, NOR SHALL THERE BE ANY OFFER OF SECURITIES IN ANY JURISDICTION IN WHICH SUCH OFFER OR SALE WOULD BE UNLAWFUL.

THIS PRESS RELEASE AND THE OFFERING WHEN MADE ARE ONLY ADDRESSED TO, AND DIRECTED IN, THE UNITED KINGDOM AND MEMBER STATES OF THE EUROPEAN ECONOMIC AREA (THE "EEA") AT PERSONS WHO ARE "QUALIFIED INVESTORS" WITHIN THE MEANING OF THE PROSPECTUS REGULATION ("QUALIFIED INVESTORS"). FOR THESE PURPOSES, THE EXPRESSION "PROSPECTUS REGULATION" MEANS REGULATION (EU) 2017/1129.

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 BONDS HAVE BEEN SUBJECT TO A PRODUCT APPROVAL PROCESS, WHICH HAS DETERMINED THAT: (I) THE TARGET MARKET FOR THE BONDS IS ELIGIBLE COUNTERPARTIES AND PROFESSIONAL CLIENTS ONLY, EACH AS DEFINED IN MIFID II; AND (II) ALL CHANNELS FOR DISTRIBUTION OF THE BONDS TO ELIGIBLE COUNTERPARTIES AND PROFESSIONAL CLIENTS ARE APPROPRIATE. ANY PERSON SUBSEQUENTLY OFFERING, SELLING OR RECOMMENDING THE BONDS (A "DISTRIBUTOR") SHOULD TAKE INTO CONSIDERATION THE MANUFACTURERS' TARGET MARKET ASSESSMENT; HOWEVER, A DISTRIBUTOR SUBJECT TO MIFID II IS RESPONSIBLE FOR UNDERTAKING ITS OWN TARGET MARKET ASSESSMENT IN RESPECT OF THE BONDS (BY EITHER ADOPTING OR REFINING THE MANUFACTURERS' TARGET MARKET ASSESSMENT) AND DETERMINING APPROPRIATE DISTRIBUTION CHANNELS.

THE TARGET MARKET ASSESSMENT IS WITHOUT PREJUDICE TO THE REQUIREMENTS OF ANY CONTRACTUAL OR LEGAL SELLING RESTRICTIONS IN RELATION TO ANY OFFERING OF THE BONDS.

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 BONDS.

THE BONDS ARE NOT INTENDED TO BE OFFERED, SOLD OR OTHERWISE MADE AVAILABLE TO AND SHOULD NOT BE OFFERED, SOLD OR OTHERWISE MADE AVAILABLE TO ANY RETAIL INVESTOR IN THE EEA OR THE UNITED KINGDOM. FOR THESE PURPOSES, A RETAIL INVESTOR MEANS A PERSON WHO IS ONE (OR MORE) OF: (I) A RETAIL CLIENT AS DEFINED IN POINT (11) OF ARTICLE 4(1) OF MIFID II; OR (II) A CUSTOMER WITHIN THE MEANING OF DIRECTIVE (EU) 2016/97, WHERE THAT CUSTOMER WOULD NOT QUALIFY AS A PROFESSIONAL CLIENT AS DEFINED IN POINT (10) OF ARTICLE 4(1) OF MIFID II. CONSEQUENTLY, NO KEY INFORMATION DOCUMENT REQUIRED BY REGULATION (EU) NO 1286/2014, AS AMENDED (THE "PRIIPS REGULATION") FOR OFFERING OR SELLING THE BONDS OR OTHERWISE MAKING THEM AVAILABLE TO RETAIL INVESTORS IN THE EEA OR THE UNITED KINGDOM HAS BEEN PREPARED AND THEREFORE OFFERING OR SELLING THE BONDS OR OTHERWISE MAKING THEM AVAILABLE TO ANY RETAIL INVESTOR IN THE EEA OR THE UNITED KINGDOM MAY BE UNLAWFUL UNDER THE PRIIPS REGULATION.

IN ADDITION, IN THE UNITED KINGDOM THIS PRESS RELEASE IS BEING DISTRIBUTED ONLY TO, AND IS DIRECTED ONLY AT, QUALIFIED INVESTORS (I) 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, AS AMENDED (THE "ORDER") AND QUALIFIED INVESTORS FALLING WITHIN ARTICLE 49(2)(A) TO (D) OF THE ORDER, AND (II) TO WHOM IT MAY OTHERWISE LAWFULLY BE COMMUNICATED (ALL SUCH PERSONS TOGETHER BEING REFERRED TO AS "RELEVANT PERSONS"). THIS PRESS RELEASE MUST NOT BE ACTED ON OR RELIED ON (I) IN THE UNITED KINGDOM, BY PERSONS WHO ARE NOT RELEVANT PERSONS, AND (II) IN ANY MEMBER STATE OF THE EEA, BY PERSONS WHO ARE NOT QUALIFIED INVESTORS. ANY INVESTMENT OR INVESTMENT ACTIVITY TO WHICH THIS PRESS RELEASE RELATES IS AVAILABLE ONLY TO (A) RELEVANT PERSONS IN THE UNITED KINGDOM AND WILL BE ENGAGED IN ONLY WITH RELEVANT PERSONS IN THE UNITED KINGDOM AND (B) QUALIFIED INVESTORS IN MEMBER STATES OF THE EEA.

THE JERSEY FINANCIAL SERVICES COMMISSION HAS GIVEN, AND HAS NOT WITHDRAWN, ITS CONSENT UNDER ARTICLE 2 OF THE CONTROL OF BORROWING (JERSEY) ORDER 1958 TO THE ISSUE OF SHARES IN THE GUARANTOR. THE JERSEY FINANCIAL SERVICES COMMISSION IS PROTECTED BY THE CONTROL OF BORROWING (JERSEY) LAW 1947 AGAINST LIABILITY ARISING FROM THE DISCHARGE OF ITS FUNCTIONS UNDER THAT LAW. IT MUST BE DISTINCTLY UNDERSTOOD THAT, IN GIVING THESE CONSENTS, NEITHER THE REGISTRAR OF COMPANIES NOR THE JERSEY FINANCIAL SERVICES COMMISSION TAKES ANY RESPONSIBILITY FOR THE FINANCIAL SOUNDNESS OF THE ISSUER OR THE GUARANTOR OR FOR THE CORRECTNESS OF ANY STATEMENTS MADE, OR OPINIONS EXPRESSED, WITH REGARD TO EITHER OF THEM. THE GUARANTOR HAS TAKEN ALL REASONABLE CARE TO ENSURE THAT THE FACTS STATED IN THIS PRESS RELEASE ARE TRUE AND ACCURATE IN ALL MATERIAL RESPECTS, AND THAT THERE ARE NO OTHER FACTS THE OMISSION OF WHICH WOULD MAKE MISLEADING ANY STATEMENT IN THIS PRESS RELEASE, WHETHER OF FACTS OR OF OPINION. THE GUARANTOR ACCEPTS RESPONSIBILITY ACCORDINGLY. COPIES OF THIS PRESS RELEASE ARE NOT BEING, AND MUST NOT BE, MAILED, OR OTHERWISE FORWARDED, DISTRIBUTED, SENT IN, OR OTHERWISE CIRCULATED IN JERSEY, CHANNEL ISLANDS.

ANY DECISION TO PURCHASE ANY OF THE BONDS SHOULD ONLY BE MADE ON THE BASIS OF AN INDEPENDENT REVIEW BY A PROSPECTIVE INVESTOR OF THE ISSUER'S AND THE GUARANTOR'S PUBLICLY AVAILABLE INFORMATION. NEITHER THE MANAGERS NOR ANY OF THEIR RESPECTIVE AFFILIATES ACCEPT ANY LIABILITY ARISING FROM THE USE OF, OR MAKE ANY REPRESENTATION AS TO THE ACCURACY OR COMPLETENESS OF, THIS PRESS RELEASE OR THE ISSUER'S AND THE GUARANTOR'S PUBLICLY AVAILABLE INFORMATION. THE INFORMATION CONTAINED IN THIS PRESS RELEASE IS SUBJECT TO CHANGE IN ITS ENTIRETY WITHOUT NOTICE UP TO THE ISSUE DATE.

POTENTIAL INVESTORS WHO ARE IN ANY DOUBT ABOUT THE CONTENTS OF THIS PRESS RELEASE SHOULD CONSULT THEIR STOCKBROKER, BANK MANAGER, SOLICITOR, ACCOUNTANT OR OTHER FINANCIAL ADVISER. IT SHOULD BE REMEMBERED THAT THE PRICE OF SECURITIES AND THE INCOME FROM THEM CAN GO DOWN AS WELL AS UP.

EACH PROSPECTIVE INVESTOR SHOULD PROCEED ON THE ASSUMPTION THAT IT MUST BEAR THE ECONOMIC RISK OF AN INVESTMENT IN THE BONDS OR THE ORDINARY SHARES TO BE ISSUED OR TRANSFERRED AND DELIVERED UPON CONVERSION OF THE BONDS AND NOTIONALLY UNDERLYING THE BONDS (TOGETHER WITH THE BONDS, THE "SECURITIES"). NONE OF THE ISSUER, THE GUARANTOR OR THE MANAGERS MAKE ANY REPRESENTATION AS TO (I) THE SUITABILITY OF THE SECURITIES FOR ANY PARTICULAR INVESTOR, (II) THE APPROPRIATE ACCOUNTING TREATMENT AND POTENTIAL TAX CONSEQUENCES OF INVESTING IN THE SECURITIES OR (III) THE FUTURE PERFORMANCE OF THE SECURITIES EITHER IN ABSOLUTE TERMS OR RELATIVE TO COMPETING INVESTMENTS.

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

Each of the Issuer, the Guarantor, the MANAGERS and their respective affiliates expressly disclaims any obligation or undertaking to update, review or revise any statement contained in this PRESS RELEASE whether as a result of new information, future developments or otherwise.

 

END

 

 

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