Fuller, Smith & Turner P.L.C.
(“Fuller, Smith & Turner”, “Fuller's”, the “Company” or the “Group”)
Proposed Placing of up to 6,455,447 New 'A' Ordinary Shares at a price of 830 pence per Placing Share
Fuller, Smith & Turner P.L.C. (LSE: FSTA.L), a premium pubs and hotels business, today announces its intention to conduct a non-pre-emptive placing of up to 6,455,447 new 'A' Ordinary Shares of 40 pence each in the capital of the Company (the “Placing Shares”) representing up to approximately 20 per cent. of the Company's existing issued 'A' ordinary share capital (the “Placing”), at a price of 830 pence per Placing Share (the “Placing Price”). The Company has received irrevocable undertakings from Directors who have also committed to contribute £225,000 in total to subscribe for 'A' Ordinary Shares and apply to acquire 'B' Ordinary Shares in conjunction with the Placing. The Placing Price represents a discount of approximately 4.6 per cent. to the closing mid-market price of 870 pence per ordinary share on 30 March 2021.
The Placing, which is being conducted by way of an accelerated bookbuild (the “Bookbuild”) available to qualifying new and existing investors, will be launched immediately following the release of this announcement. The Placing is conditional on certain shareholder approvals (the 'Resolutions') at General Meetings to be convened for 20 April 2021. The Company has received irrevocable undertakings to vote in favour of the Resolutions from Directors and certain other Ordinary Shareholders.
Numis Securities Limited (“Numis”) is acting as sole bookrunner in relation to the Placing. The Company and Numis have entered into a placing agreement dated 31 March 2021 in connection with the Placing (the “Placing Agreement”).
Trading and Financing Update
Fuller's has separately today issued a trading and financing update (the “ Update “), which includes details of amended and extended banking facilities and the planned repayment of £100 million commercial paper under the CCFF (the “Covid Corporate Financing Facility”). The amended and extended banking facilities outlined in the Update are conditional on completion of the Placing.
This announcement (together with the Appendix, the “ Announcement “) should be read in conjunction with the Update.
Reasons for the Placing
The Group's long-term strategy remains unchanged despite the short-term challenges presented by the pandemic, and the Board has taken strong and decisive actions with the intention of ensuring Fuller's is well positioned to reopen strongly once trading restrictions are lifted, capitalise on available opportunities and deliver long-term returns to shareholders.
The net proceeds from the Placing, together with the amended and extended banking facilities, will:
· strengthen the Group's balance sheet so it has the flexibility to take full advantage of the reopening of the UK economy and enable the Company to explore growth opportunities in line with its long-term strategy;
· provide additional liquidity, headroom, and resilience if the stepped easing of restrictions under the Government Roadmap is delayed for any reason or Covid-related Government restrictions are re-introduced; and
· enable the Group to return to pre-pandemic debt and pro forma leverage levels by early 2022, assuming restrictions continue to ease in line with the Government Roadmap
More details on the reasons for the Placing can be found in the Update.
Shareholder Consultation and Shareholder Approvals
Fuller's acknowledges that it is seeking to issue Placing Shares amounting to up to 20 per cent. of the existing issued 'A' Ordinary Share capital of the Company on a non-pre-emptive basis and therefore it has consulted with the Company's major ordinary shareholders ahead of the release of this Announcement. The Placing structure has been chosen as it is considered to be the most efficient, in terms of financial outlay, time to completion and minimising management distraction during an important and unprecedented time for the sector and the Company. The Placing is conditional on shareholder approval of the Resolutions and a Circular is expected be posted to shareholders on 1 April 2021. The Company has received irrevocable undertakings to vote in favour of the Resolutions from Directors and certain other Ordinary Shareholders. The Board's unanimous view is that the Placing is in the best interest of shareholders, as well as wider stakeholders in Fuller's, and will promote the long-term success of Fuller's. The Board intends to recommend that shareholders approve the Resolutions at the General Meetings.
'B' Share Offer
The Company is also providing 'B' Ordinary Shareholders with the opportunity to offer to purchase up to 4,367,472 'B' Ordinary Shares held in treasury pro-rata to their holdings of 'B' Ordinary Shares as at 30 March 2021. The 'B' Share Offer is in addition to the funds raised in the Placing and is not underwritten.
Details of the Placing
The Placing will be conducted through the Bookbuild which will be launched immediately following the release of this Announcement, in accordance with the terms and conditions of the Placing set out in the Appendix to this Announcement.
The Placing is subject to the approval of certain resolutions to be considered at General Meetings to be convened for 20 April 2021. Further details on the Resolutions and the General Meetings can be found in a Circular which is expected to be posted to shareholders tomorrow.
The final number of Placing Shares will be determined at the close of the Bookbuild, and the result will be announced as soon as practicable thereafter. The timing for the close of the Bookbuild and the allocation of the Placing Shares shall be determined together by, and at the absolute discretion of, Numis and the Company. Details of the number of Placing Shares will be announced as soon as practicable after the close of the Bookbuild.
The Placing Shares, when issued, will be fully paid and will rank pari passu in all respects with each other and with the existing 'A' Ordinary Shares in the capital of the Company, including, without limitation, the right to receive all dividends and other distributions declared, made or paid after the date of issue.
Applications will be made (i) to the Financial Conduct Authority (the “FCA”) for admission of the Placing Shares to the premium listing segment of the Official List; and (ii) to London Stock Exchange plc for admission of the Placing Shares to trading on its main market for listed securities (together, “Admission”).
Subject to the approval by shareholders of the Resolutions at the General Meetings, settlement for the Placing Shares and Admission are expected to take place on or before 8.00 a.m. on 21 April 2021. The Placing is conditional upon, amongst other things, Admission becoming effective. The Placing is also conditional upon the Placing Agreement not being terminated in accordance with its terms. The Appendix to this Announcement sets out further information relating to the Bookbuild and the terms and conditions of the Placing.