NOT FOR
RELEASE, PUBLICATION OR DISTRIBUTION IN WHOLE OR IN PART, IN, INTO
OR FROM ANY JURISDICTION WHERE TO DO SO WOULD CONSTITUTE A
VIOLATION OF THE RELEVANT LAWS OR REGULATIONS OF SUCH
JURISDICTION
This announcement contains inside
information
FOR IMMEDIATE
RELEASE
14 May
2024
RECOMMENDED CASH
ACQUISITION
OF
IQGeo GROUP PLC ("IQGeo")
BY
Geologist Bidco Limited ("BIDCO")
a newly formed
company wholly-owned by funds advised by Kohlberg Kravis Roberts
& Co. L.P. and its affiliates ("KKR")
to be effected by means of a Scheme of
Arrangement
under Part 26 of the Companies Act 2006
Summary
·
The boards of Bidco and IQGeo are pleased to announce that
they have reached agreement on the terms of a recommended cash
acquisition of the entire issued and to be issued ordinary share
capital of IQGeo (the "Acquisition").
Acquisition
terms
·
Under the terms of the Acquisition, IQGeo Shareholders will
be entitled to receive:
For
each IQGeo
Share held:
|
480 pence in
cash
(the "Cash Offer")
|
·
The Cash Offer values the entire issued and to be issued
share capital of IQGeo at approximately £333 million on a fully
diluted basis and implies an enterprise value of approximately £316
million.
·
The Cash Offer represents attractive enterprise value
multiples of approximately:
°
14.9x IQGeo's Exit ARR of £21.3 million as at 31 December
2023;
°
20.1x IQGeo's In-year Recurring Revenue of £15.7 million for
FY2023;
°
7.1x IQGeo's revenue of £44.5 million for FY2023;
°
48.1x IQGeo's Adjusted EBITDA of £6.6 million for FY2023;
and
°
139.6x IQGeo's Adjusted EBITDAC of £2.3 million for
FY2023.
·
The Cash Offer provides certain value for shareholders at a
premium of approximately:
°
48 per cent. to the twelve-month volume weighted average
price of 325 pence per IQGeo Share to 13 May 2024 (being the Latest
Practicable Date);
°
36 per cent. to the six-month volume weighted average price
of 352 pence per IQGeo Share to the Latest Practicable Date;
and
°
19 per cent. to the Closing Price of 405 pence per IQGeo
Share on the Latest Practicable Date.
·
As an alternative to the Cash Offer, Eligible IQGeo
Shareholders may elect for the Alternative Offer (as defined in
paragraph 2 of this Announcement),
pursuant to which they will receive unlisted ordinary shares, which
will ultimately be issued pursuant to the mechanism referred to in
paragraph 14 of this Announcement, in the capital of a holding
company of Bidco to be incorporated in England and Wales for the
purpose of the Acquisition ("Topco") (the "Topco Investor Shares"). IQGeo
Shareholders will only be able to elect for the Alternative Offer
in relation to their entire holding of IQGeo Shares and not part
only. The Topco Investor Shares will be independently valued and an
estimate of the value of the Topco Investor Shares will be included
in the Scheme Document. A summary of the Topco Investor Shares is
set out in paragraph 13 of this
Announcement and in Appendix 4 to this
Announcement, and further details will be included in the Scheme
Document, the Topco Shareholders' Agreement and the Topco
Articles.
·
If, on or after the date of this Announcement and on or prior
to the Effective Date, any dividend and/or other distribution
and/or return of capital is authorised, declared, made or paid or
becomes payable in respect of IQGeo Shares, Bidco reserves the
right to reduce the cash consideration payable under the Cash Offer
(and, as the case may be, the consideration due under the
Alternative Offer) by an amount equal to all or part of any such
dividend and/or other distribution and/or return of capital, in
which case IQGeo Shareholders would be entitled to receive and
retain any such dividend and/or other distribution and/or return of
capital.
Background to
and reasons for the Acquisition
·
KKR has been assessing IQGeo and its business for a number of
months and recognises IQGeo's differentiated and modern product,
proven management team and strong value proposition for its
customers. Moreover, IQGeo operates in a sizeable and fast-growing
geospatial software market, providing critical software and
services to support leading operators within the telecoms and
utility segments across their full lifecycle, from network design
to operation.
·
KKR sees an opportunity to accelerate IQGeo's transition
towards a recurring software centric business model and the
development of IQGeo's future product roadmap under private
ownership. IQGeo's sector is developing rapidly, as fibre and grid
infrastructure are undergoing major transformation and upgrades to
deliver against national connectivity and sustainability goals. For
this, IQGeo will require significant investment that is likely to
reduce profitability in the short to medium term, but
build the strong operational foundations required to support
IQGeo's next phase of growth, scale its platform globally and drive
sustainable long-term value. As such, KKR believes that moving to
private ownership is in the long-term interest of IQGeo, its
customers and its other stakeholders. Consistent with this
approach, KKR is financing the Cash Offer entirely from equity and
has a conservative approach to leverage to focus cash generation on
investment for the future.
·
KKR is also strongly positioned to support IQGeo in these
ambitions. By investing from both the KKR Global Impact Fund and
Next Generation Technology Growth Fund, KKR brings a deep
understanding of the operational challenges facing IQGeo's
end-markets as well as extensive technology sector expertise,
including via investments in ReliaQuest, OutSystems and KnowBe4.
KKR sees the opportunity to drive investments at IQGeo
across:
°
Technology: further
expanding the breadth of its software solution suite via
incremental product upgrades and new capabilities;
°
Organisational
processes: scaling key operational areas
including sales and corporate development to sustain IQGeo's
existing commercial momentum;
°
Sustainability:
supporting IQGeo to continue to track and improve product return on
investment to customers while providing a leading solution for the
efficient roll-out and maintenance of new and existing
networks;
°
Customer
relationships: strengthening and growing
IQGeo's customer base with companies deploying fibre and developing
grid infrastructure;
°
International
footprint: supporting IQGeo's international
expansion efforts; and
°
Strategic
M&A: supporting management in accelerating
its inorganic growth strategy should the opportunity arise for
strategic acquisitions which would add incremental product
functionality or access to new customers and/or regions.
·
KKR is also a major global investor in telecoms
infrastructure, particularly fibre deployment and electricity grid
infrastructure, and has developed a deep understanding of market
dynamics in these two sectors. The Acquisition will provide IQGeo
and its management team with access to KKR's extensive global
network, support from a broad range of KKR tools and dedicated
value creation resources with a view to accelerating IQGeo's
current organic growth momentum delivered with existing
resources.
·
This offer gives IQGeo's shareholders a price, and certainty
in the context of low trading liquidity and share price volatility,
that reflect IQGeo's strong historical performance, while allowing
KKR to make a long-term commitment to support the business in
achieving its goals and maximising its potential.
Background to
and reasons for the recommendation
·
Under the leadership of its current management team, IQGeo
has delivered strong revenue growth, and EBITDA and net income
profitability in FY2022 and FY2023, respectively. The Board
believes IQGeo's AIM listing has played a vital role in its
development. The market has supported the Company with equity
capital for acquisitions and the share price has increased more
than 2.7x in the last two years.
·
As a result of its recent growth, the Board
believes IQGeo is now approaching a potential inflection point,
with three key areas of additional investment likely to be required
over the coming years:
°
in light of the increasing number of complex projects for
large Tier-1 customers, the Company's lean operating structure
creates execution risk, and investments in people and operational
processes may therefore need to be brought forward;
°
positioning the business to capture the longer-term market
opportunity would require a step change in product and technology
investment; and
°
capitalising on acquisition opportunities would require
investment in corporate development functions as well as access to
additional expertise and capital.
·
Whilst the Board believes that IQGeo can deliver on
short-term growth expectations without significantly expanding
existing levels of investment, this could increase execution risk,
and increased investment will be required to underpin medium and
long-term growth expectations. This would result in a change in
IQGeo's financial profile, introduce volatility in IQGeo's
financial performance, and carry an element of risk. This could
have negative implications for IQGeo's share price, especially in
view of its strong recent rise and the very low levels of
liquidity.
·
Over the last two years, the Company has received numerous
unsolicited approaches, but no one has put forward an offer that
the Board would be prepared to recommend to shareholders. In
response to two credible and well-qualified approaches from
interested parties, the Board decided to undertake a competitive
private sale process under the Takeover Code. The Board
commissioned Evercore to approach a carefully selected list of the
best qualified candidates to participate in this
process.
·
Having engaged with such parties over several months,
including providing detailed information under non-disclosure
agreements, the Board concluded that the proposal from Bidco, which
followed a period of extensive price negotiation, was the most
attractive for shareholders, the most immediately deliverable and
likely to be most advantageous for the business and its other
stakeholders. Discussions with all other parties who have
approached IQGeo in the past two years or were involved in the
recent process have been terminated.
·
The IQGeo Directors have taken all relevant factors into
account in considering the terms of the Cash Offer,
including:
°
the IQGeo Directors have concluded that the terms of the Cash
Offer reflect the risk-adjusted fundamental valuation of IQGeo and
its future prospects;
°
the Cash Offer provides shareholders with an opportunity to
realise certain value of their holdings today at a
premium to IQGeo's all-time share price high. In this context the
Board has considered the historic share price volatility of IQGeo
and the low trading liquidity in its shares;
°
the implied valuation of IQGeo, in particular the enterprise
value multiples set out above, which the Board considers to be
attractive;
°
the premia to recent volume-weighted average prices as set
out above;
°
the returns over time that the Cash Offer will enable
shareholders to crystallise; and
°
the risk associated with the delivery of future potential
value and share price performance, with or without accelerated near
term investment, particularly in the context of market and broader
macroeconomic environment volatility.
·
In addition, the IQGeo Directors are pleased to note Bidco's
stated intentions concerning IQGeo's strategy, growth plans,
management and employees, and other stakeholders of IQGeo, as well
as Bidco's conservative approach to leverage to focus cash
generation on investment for the future.
Recommendation
·
The IQGeo Directors, who have been so advised by Evercore and
Cavendish as to the financial terms of the Acquisition, consider
the terms of the Cash Offer to be fair and reasonable. In providing
advice to the IQGeo Directors, Evercore and Cavendish have taken
into account the commercial assessments of the IQGeo Directors.
Evercore is providing independent financial advice to the IQGeo
Directors for the purposes of Rule 3 of the Takeover
Code.
·
Accordingly, the IQGeo Directors intend to recommend
unanimously that IQGeo Shareholders vote (or procure votes) in
favour of the Scheme at the Court Meeting and to vote (or procure
votes) in favour of the IQGeo Resolution(s) at the General Meeting
as the IQGeo Directors who (or whose family) beneficially hold
IQGeo Shares have irrevocably undertaken to do (or procure to be
done) in respect of 4,162,181 IQGeo Shares in total, representing
in aggregate approximately 6.7 per cent. of IQGeo's ordinary share
capital in issue as at the Latest Practicable Date. These
irrevocable undertakings remain binding in the event a higher
competing offer is made for IQGeo by a third party.
·
Evercore and Cavendish are unable to advise the IQGeo
Directors as to whether or not the financial terms of the
Alternative Offer are fair and reasonable. This is because of the
significant and variable impact of the disadvantages and advantages
of the Alternative Offer for individual IQGeo Shareholders
including, in terms of the advantages, in particular, the ability
to participate in the future value creation of the IQGeo Group, and
in terms of the disadvantages, in particular, the terms of the
Topco Investor Shares, including the fact that they are illiquid
and are not transferrable (save with the prior consent of KKR
Investor or pursuant to the drag and tag rights), the level of
uncertainty in their future value, and the potential dilution that
may result if an IQGeo Shareholder elected not to participate in
any further issue of securities by Topco in the period following
the Effective Date. Further details are set out in paragraph 4 of
this Announcement.
·
Accordingly, the IQGeo Directors are unable to form an
opinion as to whether or not the terms of the Alternative Offer are
fair and reasonable and are not making any recommendation to IQGeo
Shareholders as to whether or not they should elect for the
Alternative Offer.
·
IQGeo Shareholders are encouraged to take into account the
key advantages and disadvantages of the Alternative Offer outlined
in paragraph 4 of this Announcement, as
well as their particular circumstances, when deciding whether to
elect for the Alternative Offer. IQGeo Shareholders should also
ascertain whether acquiring or holding Topco Investor Shares is
affected by the laws of the relevant jurisdiction in which they
reside and consider whether Topco Investor Shares are a suitable
investment in light of their own personal circumstances.
Accordingly, IQGeo Shareholders are strongly recommended to seek
their own independent financial, tax and legal advice in light of
their own particular circumstances and investment objectives before
deciding whether to elect for the Alternative Offer. Any decision
to elect for the Alternative Offer should be based on independent
financial, tax and legal advice and full consideration of this
Announcement and the Scheme Document (when published).
Shareholder
support
·
In addition to the irrevocable undertakings given by the
IQGeo Directors referred to above, Bidco has also received
irrevocable undertakings from:
°
Kestrel Partners to vote (or procure votes) (i) in favour of
the Scheme at the Court Meeting and the IQGeo Resolution(s) at the
General Meeting and (ii) against any competing proposal, in respect
of 16,294,119 IQGeo Shares, representing approximately 26.4 per
cent. of the ordinary share capital of IQGeo in issue as at the
Latest Practicable Date. This irrevocable undertaking remains
binding in the event a higher competing offer is made for IQGeo by
a third party;
°
Mr Raf Meersman to vote in favour of the Scheme at the Court
Meeting and the IQGeo Resolution(s) at the General Meeting, in
respect of 777,657 IQGeo Shares in total, representing
approximately 1.3 per cent. of the ordinary share capital of IQGeo
in issue as at the Latest Practicable Date. This irrevocable
undertaking remains binding in the event a higher competing offer
is made for IQGeo by a third party; and
°
each of Herald Investment Management Limited and Mr Richard
Terence Green to vote (or procure votes) in favour of the Scheme at
the Court Meeting and the IQGeo Resolution(s) at the General
Meeting, in respect of, in aggregate, 3,455,585 IQGeo Shares,
representing approximately 5.6 per cent. of the ordinary share
capital of IQGeo in issue as at the Latest Practicable
Date.
·
In addition, Bidco has also received non-binding letters of
intent from Canaccord Genuity Asset Management and Charles Stanley
& Co Ltd to vote (or procure votes) in favour of the Scheme at
the Court Meeting and the IQGeo Resolution(s) at the General
Meeting, in respect of, in aggregate, 11,250,000 IQGeo Shares,
representing approximately 18.2 per cent. of the ordinary share
capital of IQGeo in issue as at the Latest Practicable
Date.
·
Bidco has therefore received, in aggregate, irrevocable
undertakings and letters of intent in respect of 35,939,542 IQGeo
Shares, representing approximately 58.2 per cent. of IQGeo's
ordinary share capital in issue as at the Latest Practicable
Date.
·
Further details of these irrevocable undertakings and letters
of intent, including the circumstances in which they may lapse, are
set out in paragraph 5 of this Announcement and in Appendix 3 to
this Announcement.
Information
relating to IQGeo
·
IQGeo is a leading global provider of geospatial software
solutions to telecommunication and utility operators. IQGeo's
award-winning network management software is "Building Better
Networks" within operators through greater collaboration and
process efficiency across the operational lifecycle, from planning
and design to construction, operations, and sales
optimisation.
·
IQGeo partners with a diverse range of over 500 clients
including large multinational telecommunication and utility
companies and smaller regional and private network operators to
deliver the digital innovation required to increase network
resilience, operational safety, and business return on investment.
IQGeo's mission is to provide operators with the innovative
software needed to manage the increasingly complex fibre networks
and electric grids that are fundamental to delivering digital
equity to communities and to the net-zero carbon economy of the
future.
·
In January 2019, after Ubisense Group plc disposed of its
RTLS SmartSpace technology and brand, it changed its name to IQGeo
Group plc and repositioned to focus on its geospatial software
solutions business. IQGeo is headquartered in
Cambridge, UK, and currently employs over 200 professionals across
offices in the UK, US, Canada, Belgium, Germany, Japan, and
Malaysia. The IQGeo Shares are admitted to trading on the AIM
Market of the London Stock Exchange.
Information
relating to KKR and Bidco
·
KKR is a leading global investment firm that offers
alternative asset management as well as capital markets and
insurance solutions, with approximately US$578 billion in assets
under management as of Q1 2024. KKR aims to generate attractive
investment returns by following a patient and disciplined
investment approach, employing world-class people, and supporting
growth in its portfolio companies and communities.
·
KKR will invest in the Acquisition largely through KKR's
Global Impact Fund II, a US$2.8 billion fund dedicated to investing
in companies whose products and services contribute measurable
progress toward the United Nations Sustainable Development Goals,
as well as through KKR's Next Generation Technology Growth Fund
III, an approximately US$3 billion fund dedicated to growth equity
investment opportunities in the technology space.
·
KKR established the Global Impact Strategy in 2018 to take a
focused and differentiated private equity investment approach,
offering the potential for attractive risk-adjusted return
opportunities in the global impact space.
·
Seeking to leverage KKR's decades-long industry expertise,
and its broad network of proprietary relationships, investment
sourcing, asset selection and sustainability capabilities, the
Global Impact Strategy takes a commercial-first approach that
focuses on generating both attractive risk-adjusted returns and
capitalising, building, and growing companies with measurable
social and/or environmental impact.
·
In 2023, KKR closed its third Tech Growth Fund, Next
Generation Technology Growth Fund III, a fund dedicated to growth
equity investment opportunities in the technology space. KKR has
established a proven track record of supporting technology-focused
growth companies, having invested over US$21.6 billion in related
investments since 2014 and built a dedicated global team with deep
technology growth equity expertise.
·
Bidco is a newly formed company wholly-owned by funds advised
by Kohlberg Kravis Roberts & Co. L.P. and its
affiliates.
Timetable and
Conditions
·
It is intended that the Acquisition will be effected by way
of a court-sanctioned scheme of arrangement under Part 26 of the
Companies Act. However, Bidco reserves the right to elect to
implement the Acquisition by way of a Takeover Offer, subject to
the consent of the Panel (where necessary) and the terms of the
Co-operation Agreement.
·
The Acquisition will be put to Scheme Shareholders at the
Court Meeting and IQGeo Shareholders at the General Meeting. In
order to become Effective, the Scheme must be approved by a
majority in number of the Scheme Shareholders voting at the Court
Meeting, either in person or by proxy, representing at least 75 per
cent. in value of the Scheme Shares voted. In addition, the
approval of the IQGeo Resolution(s) by the requisite majority of
IQGeo Shareholders at the General Meeting (expected to be held
immediately after the Court Meeting) is also required for the
implementation of the Scheme, together with the sanction of the
Scheme by the Court. Finally, a copy of the Court Order must be
delivered to the Registrar of Companies, upon which the Scheme will
become Effective.
·
The Acquisition will also be conditional upon the receipt of
antitrust clearance in Cyprus as well as regulatory clearances (or
the expiry of relevant waiting periods) in Belgium, Germany and the
UK.
·
The Acquisition will be made in accordance with the Takeover
Code and on the terms and subject to the Conditions which are set
out in Appendix 1 to this Announcement
and on the further terms and conditions that will be set out in the
Scheme Document.
·
The Scheme Document, containing further information about the
Acquisition and notices of the Court Meeting and the General
Meeting, and which will be accompanied by the Forms of Proxy and
Form of Election, will be published as soon as reasonably
practicable, and in any event within 28 days of this Announcement
(unless the Panel consents to a later date). The Scheme Document
will specify the actions to be taken by IQGeo Shareholders and will
contain an expected timetable for the implementation of the
Scheme.
·
The Scheme is expected to become Effective in Q4 2024,
subject to the satisfaction or, where permitted, waiver of the
Conditions set out in the Appendix 1 to
this Announcement.
Commenting on
the Acquisition, Paul Taylor, Chair of IQGeo,
said:
"Having
served on the IQGeo Board since February 2011, I am immensely proud
of the strategic decisions and operational execution which has
established IQGeo as one of the leading providers of geospatial
software solutions to telecoms and utilities operators globally.
Under the leadership of the current management team, IQGeo has
delivered strong revenue growth and shareholder returns of over 9x
over the last five years.
KKR's
proposed offer underscores IQGeo's highly successful cloud-based
software and services, and represents an attractive valuation and
an opportunity for shareholders to receive certainty through cash
consideration, not only for value created in recent years but also
the future platform value of IQGeo. The proposed acquisition will
provide IQGeo with the ownership structure and investment required
to unlock its full potential."
Commenting on
the Acquisition, Richard Petti, CEO of IQGeo,
added:
"We are
committed to the success of our customers and our employees. Thanks
to them, we have built a thriving business that delivers
award-winning innovative software for the telecommunication and
utility industries worldwide. The proposed acquisition is in direct
response to this success, creating an opportunity for us to
accelerate investment in our people, processes, and products and
increase our ability to respond to market momentum. It's also
important to us that there is close cultural alignment between
KKR's Global Impact and Technology Growth funds with IQGeo's focus
on innovation and mission to bridge the digital divide and build
the net-zero energy networks of the future. Their investment will
underpin the next phase of growth of IQGeo's exciting
journey."
Commenting on
the Acquisition, Rami Bibi, Managing Director and Head of EMEA for
KKR Global Impact, said:
"In our view,
IQGeo is unique in its support for continued global efforts
addressing the digital divide and transforming grid infrastructure,
which is aligned with KKR's strong focus of investing behind grid
electrification for net-zero goals. To capitalise on the global
growth potential ahead, increased investment and an acceleration of
IQGeo's strategy are imperative, and private ownership under KKR
will help facilitate this."
Patrick
Devine, Managing Director on the Tech Growth team at KKR,
added:
"KKR's global
platform and track record of scaling leading software businesses,
combined with our experience of investing in telecom and grid
networks gives us the right tools and capability to support IQGeo,
and we look forward to working closely with its management team to
capitalise on the long-term opportunity ahead."
This summary
should be read in conjunction with, and is subject to, the full
text of this Announcement and its appendices. The Acquisition will
be subject to the Conditions and further terms set out
in Appendix
1 to this
Announcement and to the full terms and conditions which will be set
out in the Scheme Document. Appendix 2 to this Announcement contains the
sources of information and bases of calculations of certain
information contained in this Announcement.
Appendix 3
contains a summary of the
irrevocable undertakings and letters of intent
received in relation to this Acquisition.
Appendix 4
contains a summary of Topco, the Topco Investor
Shares and eligibility to elect for the Alternative Offer.
Appendix 5
contains definitions of
certain expressions used in this summary and in this
Announcement.
Enquiries:
Rothschild & Co (Financial Adviser
to Bidco and KKR)
|
+44 (0) 20 7280 5000
|
Anton Black
|
|
Philippe Noël
|
|
Tom Buggé
|
|
Tom Guinness
|
|
|
|
FGS Global (PR
Adviser to KKR)
|
KKR-LON@fgsglobal.com
|
Alastair Elwen
|
44 (0) 20 725 13801
|
Jack Shelley
|
|
|
|
IQGeo
|
+44 (0) 12 2360 6655
|
Richard Petti, CEO
|
|
Haywood Chapman, CFO
|
|
|
|
Evercore (Lead Financial Adviser to
IQGeo)
|
+44 (0) 20 7653 6000
|
Ed Banks
|
|
Anil Rachwani
|
|
Harrison George
|
|
|
|
Cavendish (Joint Financial Adviser,
Nomad, Broker to IQGeo)
|
+44 (0) 20 7220 0500
|
Henrik Persson
|
|
Tim Redfern
|
|
Seamus Fricker
|
|
|
|
H/Advisors Maitland (PR Adviser to
IQGeo)
|
IQGeo@h-advisors.global
|
Neil
Bennett
|
+44 (0) 20 7379
5151
|
Clifford Chance LLP is acting as legal adviser
to KKR and Bidco. DAC Beachcroft LLP is acting as legal adviser to
IQGeo.
Important notices about financial
advisers
N.M.
Rothschild & Sons Limited ("Rothschild & Co"), which is
authorised and regulated by the Financial Conduct Authority in the
United Kingdom is acting exclusively for Bidco and KKR and for
no‑one else in connection with the Acquisition and will not regard
any other person as its client in relation to the Acquisition and
will not be responsible to anyone other than Bidco and KKR for
providing the protections afforded to clients of Rothschild &
Co, nor for providing advice in relation to any matter referred to
in this Announcement.
Evercore Partners
International LLP ("Evercore"), which is authorised and
regulated by the Financial Conduct Authority in the United Kingdom,
is acting exclusively as financial adviser to IQGeo
and no one else in connection with the
matters described in this
Announcement and will not
be responsible to anyone other than IQGeo for providing the protections afforded to
clients of Evercore
nor for providing advice
in connection with the
matters referred to
herein. Neither Evercore nor any
of its subsidiaries, branches or affiliates owes or accepts any
duty, liability or responsibility whatsoever (whether direct or
indirect, whether in contract, in tort, under statute or otherwise)
to any person who is not a client of Evercore in connection with
this Announcement, any statement contained herein, any offer or
otherwise. Apart from the responsibilities and liabilities, if any,
which may be imposed on Evercore by the Financial Services and
Markets Act 2000 and successor legislation, or the regulatory
regime established thereunder, or under the regulatory regime of
any jurisdiction where exclusion of liability under the relevant
regulatory regime would be illegal, void or unenforceable, neither
Evercore nor any of its affiliates accepts any responsibility or
liability whatsoever for the contents of this Announcement, and no
representation, express or implied, is made by it, or purported to
be made on its behalf, in relation to the contents of this
Announcement, including its accuracy, completeness or verification
of any other statement made or purported to be made by it, or on
its behalf, in connection with IQGeo or the matters described in
this Announcement. To the fullest extent permitted by applicable
law, Evercore and its affiliates accordingly disclaim all and any
responsibility or liability whether arising in tort, contract or
otherwise (save as referred to above) which they might otherwise
have in respect of this Announcement or any statement contained
herein.
Cavendish Capital
Markets Limited ("Cavendish"), which is authorised and
regulated by the FCA in the UK, is acting as joint financial
adviser, nominated adviser and corporate broker exclusively for
IQGeo and no one else in connection with the matters referred to in
this Announcement and will not be responsible to anyone other than
IQGeo for providing the protections afforded to its clients or for
providing advice in relation to matters referred to in this
announcement. Neither Cavendish, nor any of its affiliates, owes or
accepts any duty, liability or responsibility whatsoever (whether
direct or indirect, whether in contract, in tort, under statute or
otherwise) to any person who is not a client of Cavendish in
connection with this Announcement, any statement contained herein
or otherwise.
Further Information
This
Announcement is for information purposes only and is not intended
to and does not constitute, or form part of, any offer to sell or
an invitation to purchase any securities or a solicitation of an
offer to buy, otherwise acquire, subscribe for, sell or otherwise
dispose of any securities pursuant to the Acquisition or otherwise,
nor shall there be any purchase, sale, issuance or exchange of
securities or such solicitation in any jurisdiction in which such
offer, solicitation, sale issuance or exchange is unlawful. The
Acquisition will be made solely by means of the Scheme Document (or
any other document by which the Acquisition is made) which will
contain the full terms and conditions of the Acquisition, including
details of how to vote in respect of the Scheme. Any decision in
respect of, or other response to, the Acquisition should be made
only on the basis of the information contained in the Scheme
Document (or any other document by which the Acquisition is
made).
IQGeo will
prepare the Scheme Document to be distributed to IQGeo Shareholders
at no cost to them. IQGeo and Bidco urge IQGeo Shareholders to read
the Scheme Document when it becomes available because it will
contain important information relating to the Acquisition,
including details of how to vote in respect of the
Scheme.
The
statements contained in this Announcement are made as at the date
of this Announcement, unless some other time is specified in
relation to them, and publication of this Announcement shall not
give rise to any implication that there has been no change in the
facts set forth in this Announcement since such
date.
This
Announcement does not constitute a prospectus or prospectus
equivalent document.
Overseas jurisdictions
The release,
publication or distribution of this Announcement in jurisdictions
other than the United Kingdom, and the availability of the
Acquisition (including the Alternative Offer) to IQGeo Shareholders
who are not resident in the United Kingdom, may be restricted by
the laws of those jurisdictions and therefore persons into whose
possession this Announcement comes should inform themselves about
and observe such restrictions. Further details in relation to the
Overseas Shareholders will be contained in the Scheme Document. Any
failure to comply with any such restrictions may constitute a
violation of the securities laws of any such jurisdiction. To the
fullest extent permitted by applicable law, the companies and
persons involved in the Acquisition disclaim any responsibility or
liability for the violation of such restrictions by any
person.
Unless
otherwise determined by Bidco or required by the Takeover Code, and
permitted by applicable law and regulation, the Acquisition will
not be made available, directly or indirectly, in, into or from a
Restricted Jurisdiction. Accordingly, copies of this Announcement
and all documents relating to the Acquisition are not being, and
must not be, directly or indirectly, mailed or otherwise forwarded,
distributed or sent in, into or from a Restricted Jurisdiction, and
persons receiving this Announcement and all documents relating to
the Acquisition (including custodians, nominees and trustees) must
not mail or otherwise distribute or send them in, into or from such
Restricted Jurisdiction. If the
Acquisition is implemented by way of Takeover Offer (unless
otherwise permitted by applicable law or regulation), the Takeover
Offer may not be made, directly or indirectly, in or into or by use
of the mails or any other means or instrumentality (including,
without limitation, facsimile, e-mail or other electronic
transmission, telex or telephone) of interstate or foreign commerce
of, or any facility of a national, state or other securities
exchange of any Restricted Jurisdiction and the Takeover Offer will
not be capable of acceptance by any such use, means,
instrumentality or facilities or from within any Restricted
Jurisdiction.
This
Announcement has been prepared in connection with proposals in
relation to a scheme of arrangement pursuant to and for the purpose
of complying with English law and the Takeover Code and information
disclosed may not be the same as that which would have been
disclosed if this Announcement had been prepared in accordance with
the laws of jurisdictions outside the United Kingdom. Nothing in
this Announcement should be relied on for any other
purpose.
The
Acquisition shall be subject to the applicable requirements of the
Takeover Code, the Panel, the London Stock Exchange and the
Financial Conduct Authority.
Additional information for US
investors
The
Acquisition relates to the shares of an English company and is
being made by means of a scheme of arrangement provided for under
English company law. A transaction effected by means of a scheme of
arrangement is not subject to the tender offer or proxy
solicitation rules under the US Exchange Act. Accordingly, the
Acquisition is subject to the disclosure requirements and practices
applicable in the United Kingdom to schemes of arrangement which
differ from the disclosure requirements of the US tender offer and
proxy solicitation rules.
If, in the
future, Bidco exercises its right to implement the Acquisition by
way of a Takeover Offer, which is to be made into the US,
such Takeover Offer will be made in compliance with the
applicable US laws and regulations, including Section 14(e) and
Regulation 14E under the US Exchange Act. Such a
Takeover Offer would be made in the US by Bidco and no one
else.
In the event
that the Acquisition is implemented by way of Takeover Offer, in
compliance with applicable UK laws, Bidco, its dealer manager
(and their advisers or affiliates), or its nominees, or its brokers
(acting as agents), may from time to time make certain purchases
of, or arrangements to purchase, shares or other securities of
IQGeo other than pursuant to such Takeover Offer during the period
in which such Takeover Offer would remain open for acceptance.
These purchases may occur either in the open market at prevailing
prices or in private transactions at negotiated prices. Any
information about such purchases or arrangements to purchase shall
be disclosed as required under UK laws, shall be reported to a
Regulatory Information Service and shall be available on the London
Stock Exchange website at
www.londonstockexchange.com. To the extent that such information is
required to be publicly disclosed in the UK in accordance with
applicable regulatory requirements, this information will, as
applicable, also be made publicly available in the United
States.
It may be
difficult for US holders of IQGeo Shares to enforce their rights
and any claim arising out of the US federal securities laws in
connection with the Acquisition, since Bidco
and IQGeo are located in a
non-US jurisdiction, and some or all of their officers and
directors may be residents of a non-US jurisdiction. US holders of
IQGeo Shares may not be able to sue a non-US company or its
officers or directors in a non-US court for violations of the US
securities laws. Further, it may be difficult to compel a non-US
company and its affiliates to subject themselves to a US court's
judgement.
The Topco
Investor Shares to be issued under the Alternative Offer have not
been registered under the US Securities Act or under any laws or
with any securities regulatory authority of any state, district or
other jurisdiction, of the US and will not be listed on any stock
exchange in the US. The Topco Investor Shares may only be offered
or sold in the US in reliance on an exemption from registration
requirements of the US Securities Act including in the case of the
proposed scheme of arrangement, Section 3(a)(10) thereunder.
Nothing in this Announcement constitutes an offer to sell, or a
solicitation of offers to purchase, Topco Investor
Shares or any loan notes to be
issued by the Topco Group.
The financial
information included in this Announcement, or that may be included
in the Scheme Document, has been prepared in accordance with
accounting standards applicable in the United Kingdom and thus may
not be comparable to financial information of US companies or
companies whose financial statements are prepared in accordance
with generally accepted accounting principles in the US
("US GAAP"). US GAAP
differs in certain significant respects from accounting standards
applicable in the United Kingdom. None of the financial information
in this announcement has been audited in accordance with auditing
standards generally accepted in the United States or the auditing
standards of the Public Company Accounting Oversight Board (United
States).
Neither the
Acquisition (including the Alternative Offer) nor this Announcement
have been approved or disapproved by the US Securities and Exchange
Commission, any state securities commission in the United States or
any other US regulatory authority, nor have such authorities
approved or disapproved or passed judgement upon the fairness or
the merits of the Acquisition (including the Alternative Offer), or
determined if the information contained in this Announcement is
adequate, accurate or complete. Any representation to the contrary
is a criminal offence in the United States.
The receipt
of cash pursuant to the Acquisition by a US holder as consideration
for the transfer of its IQGeo Shares pursuant to the Acquisition
will likely be a taxable transaction for US federal income tax
purposes and under applicable US state and local, as well as
foreign and other, tax laws. Each US holder of IQGeo
Shares is urged to consult
their independent legal, tax and financial advisers regarding the
tax consequences of the Acquisition applicable to them, including
under applicable US state and local, as well as overseas and other,
tax laws.
Forward-looking
statements
This
Announcement (including information incorporated by reference in
this Announcement), oral statements made regarding the Acquisition,
and other information published by KKR, Bidco or IQGeo may contain
statements about Bidco and IQGeo that are or may be deemed to be
forward looking statements. All statements other than statements of
historical facts included in this Announcement may be forward
looking statements. Without limitation, any statements preceded or
followed by or that include the words "targets", "plans",
"believes", "expects", "aims", "intends", "will", "may", "shall",
"should", "anticipates", "estimates", "projects", "is subject to",
"budget", "scheduled", "forecast" or words or terms of similar
substance or the negative thereof, are forward looking statements.
Forward looking statements include statements relating to the
following: (i) future capital expenditures, expenses, revenues,
earnings, synergies, economic performance, indebtedness, financial
condition, dividend policy, losses and future prospects; (ii)
business and management strategies and the expansion and growth of
Bidco's or IQGeo's operations and potential synergies resulting
from the Acquisition; and (iii) the effects of government
regulation on Bidco's or IQGeo's business.
Such forward
looking statements are prospective in nature and are not based on
historical facts, but rather on current expectations and
projections of the management of Bidco and IQGeo about future
events, and are therefore subject to risks and uncertainties that
could significantly affect expected results and are based on
certain key assumptions. Many factors could cause actual results to
differ materially from those projected or implied in any forward
looking statements, including: increased competition, the loss of
or damage to one or more key customer relationships, changes to
customer ordering patterns, delays in obtaining customer approvals
for engineering or price level changes, the failure of one or more
key suppliers, the outcome of business or industry restructuring,
the outcome of any litigation, changes in economic conditions,
currency fluctuations, changes in interest and tax rates, changes
in raw materials or energy market prices, changes in laws,
regulations or regulatory policies, developments in legal or public
policy doctrines, technological developments, the failure to retain
key management, or the timing and success of future acquisition
opportunities or major investment projects. Other unknown or
unpredictable factors could cause actual results to differ
materially from those in the forward looking statements. Such
forward looking statements should therefore be construed in light
of such factors. Neither Bidco nor IQGeo, nor any of their
respective associates or directors, officers or advisers, provides
any representation, assurance or guarantee that the occurrence of
the events expressed or implied in any forward looking statements
in this Announcement will actually occur. Due to such uncertainties
and risks, readers are cautioned not to place undue reliance on
such forward looking statements, which speak only as of the date
hereof. All subsequent oral or written forward looking statements
attributable to any member of the Bidco Group or the IQGeo Group,
or any of their respective associates, directors, officers,
employees or advisers, are expressly qualified in their entirety by
the cautionary statement above.
Bidco and
IQGeo expressly disclaim any obligation to update any forward
looking or other statements contained herein, except as required by
applicable law or by the rules of any competent regulatory
authority, whether as a result of new information, future events or
otherwise.
No
profit forecasts or profit estimates or quantified financial
benefit statements
No statement
in this Announcement is intended as, or is to be construed as, a
profit forecast, profit estimate or quantified financial benefit
statement for any period and no statement in this Announcement
should be interpreted to mean that earnings or earnings per share
for IQGeo for the current or future financial years would
necessarily match or exceed the historical published earnings or
earnings per share for IQGeo.
Disclosure requirements of the Takeover
Code
Under Rule
8.3(a) of the Takeover Code, any person who is interested in 1% or
more of any class of relevant securities of an offeree company or
of any securities exchange offeror (being any offeror other than an
offeror in respect of which it has been announced that its offer
is, or is likely to be, solely in cash) must make an Opening
Position Disclosure following the commencement of the Offer Period
and, if later, following the announcement in which any securities
exchange offeror is first identified. An Opening Position
Disclosure must contain details of the person's interests and short
positions in, and rights to subscribe for, any relevant securities
of each of (i) the offeree company and (ii) any securities exchange
offeror(s). An Opening Position Disclosure by a person to whom Rule
8.3(a) applies must be made by no later than 3.30 pm (London time)
on the 10th business day following the commencement of the Offer
Period and, if appropriate, by no later than 3.30 pm (London time)
on the 10th business day following the announcement in which any
securities exchange offeror is first identified. Relevant persons
who deal in the relevant securities of the offeree company or of a
securities exchange offeror prior to the deadline for making an
Opening Position Disclosure must instead make a Dealing
Disclosure.
Under Rule
8.3(b) of the Takeover Code, any person who is, or becomes,
interested in 1% or more of any class of relevant securities of the
offeree company or of any securities exchange offeror must make a
Dealing Disclosure if the person deals in any relevant securities
of the offeree company or of any securities exchange offeror. A
Dealing Disclosure must contain details of the dealing concerned
and of the person's interests and short positions in, and rights to
subscribe for, any relevant securities of each of (i) the offeree
company and (ii) any securities exchange offeror(s), save to the
extent that these details have previously been disclosed under Rule
8. A Dealing Disclosure by a person to whom Rule 8.3(b) applies
must be made by no later than 3.30 pm (London time) on the business
day following the date of the relevant dealing.
If two or
more persons act together pursuant to an agreement or
understanding, whether formal or informal, to acquire or control an
interest in relevant securities of an offeree company or a
securities exchange offeror, they will be deemed to be a single
person for the purpose of Rule 8.3.
Opening
Position Disclosures must also be made by the offeree company and
by any offeror and Dealing Disclosures must also be made by the
offeree company, by any offeror and by any persons acting in
concert with any of them (see Rules 8.1, 8.2 and
8.4).
Details of
the offeree and offeror companies in respect of whose relevant
securities Opening Position Disclosures and Dealing Disclosures
must be made can be found in the Disclosure Table on the Panel's
website at www.thetakeoverpanel.org.uk, including details of the
number of relevant securities in issue, when the Offer Period
commenced and when any offeror was first identified. You should
contact the Panel's Market Surveillance Unit on +44 (0)20 7638 0129
if you are in any doubt as to whether you are required to make an
Opening Position Disclosure or a Dealing
Disclosure.
Publication on website
A copy of
this Announcement and the documents required to be published
pursuant to Rule 26 of the Takeover Code will be available, free of
charge, subject to certain restrictions relating to persons
resident in Restricted Jurisdictions, on Bidco's website at
https://www.documentdisplay.com and IQGeo's website at
https://www.IQGeo.com/investor-center/disclaimer-offer by no later
than 12.00 noon (London Time) on the Business Day following the
publication of this Announcement.
For the
avoidance of doubt, the contents of these websites and any websites
accessible from hyperlinks on these websites are not incorporated
into and do not form part of this Announcement.
Information relating to IQGeo
Shareholders
Please be
aware that addresses, electronic addresses and certain other
information provided by IQGeo Shareholders, persons with
information rights and other relevant persons for the receipt of
communications from IQGeo may be provided to Bidco during the Offer
Period as required under Section 4 of Appendix 4 of the Takeover
Code.
Right to receive documents in hard copy
form
In accordance
with Rule 30.3 of the Takeover Code, IQGeo Shareholders,
participants in the IQGeo Share Plans and persons with information
rights may request a hard copy of this Announcement, free of
charge, by contacting IQGeo's registrars, Link Group, at Central
Square, 29 Wellington Street, Leeds, LS1 4DL, United Kingdom or by
calling Link Group on +44 (0)371 664 0300 or via email at
shareholderenquiries@linkgroup.co.uk. Calls are charged at the
standard geographic rate and will vary by provider. Calls outside
the United Kingdom will be charged at the applicable international
rate. Lines are open between 8.30 am to 5.30 pm (London time),
Monday to Friday (except public holidays in England and Wales). For
persons who receive a copy of this Announcement in electronic form
or via a website notification, a hard copy of this Announcement
will not be sent unless so requested. Such persons may also request
that all future documents, announcements and information in
relation to the Acquisition are sent to them in hard copy
form.
Rounding
Certain
figures included in this Announcement have been subjected to
rounding adjustments. Accordingly, figures shown for the same
category presented in different tables may vary slightly and
figures shown as totals in certain tables may not be an arithmetic
aggregation of the figures that precede them.
General
If you are in
any doubt about the contents of this Announcement or the action you
should take, you are recommended to seek your own independent
financial advice immediately from your stockbroker, bank manager,
solicitor or independent financial adviser duly authorised under
FSMA if you are resident in the United Kingdom or, if not, from
another appropriately authorised independent financial
adviser.
Rule 2.9 information
For the
purposes of Rule 2.9 of the Takeover Code, IQGeo confirms that, as
at the Latest Practicable Date, it had in issue 61,723,156 ordinary
shares of 2 pence each. The International Securities Identification
Number for the IQGeo Shares is GB00B3NCXX73.
NOT FOR
RELEASE, PUBLICATION OR DISTRIBUTION IN WHOLE OR IN PART, IN, INTO
OR FROM ANY JURISDICTION WHERE TO DO SO WOULD CONSTITUTE A
VIOLATION OF THE RELEVANT LAWS OR REGULATIONS OF SUCH
JURISDICTION
This announcement contains inside
information
FOR IMMEDIATE
RELEASE
14 May 2024
RECOMMENDED CASH
ACQUISITION
OF
IQGeo GROUP PLC ("IQGeo")
BY
Geologist Bidco Limited ("BIDCO")
a newly
formed company wholly-owned by funds advised by Kohlberg Kravis
Roberts & Co. L.P. and its affiliates ("KKR")
to be effected by means of a Scheme of
Arrangement
under Part 26 of the Companies Act 2006
1.
Introduction
The boards of Bidco and IQGeo are pleased to
announce that they have reached agreement on the terms of a
recommended cash acquisition of the entire issued and to be issued
ordinary share capital of IQGeo (the "Acquisition"). The Acquisition is
intended to be implemented by means of a scheme of arrangement
under Part 26 of the Companies Act.
2.
The Acquisition
Under the terms of the Acquisition, which will
be subject to the Conditions and further terms set out below and
in Appendix 1 to this Announcement, and
to be set out in the Scheme Document, IQGeo Shareholders will be
entitled to receive:
For each IQGeo
Share held:
|
480 pence
in cash
|
|
(the "Cash
Offer")
|
The Cash Offer values the entire issued and to
be issued share capital of IQGeo at approximately £333 million on a
fully diluted basis and implies an enterprise value of
approximately £316 million.
The Cash Offer represents attractive enterprise
value multiples of approximately:
·
14.9x IQGeo's Exit ARR of £21.3 million as at 31 December
2023;
·
20.1x IQGeo's In-year Recurring Revenue of £15.7 million for
FY2023;
·
7.1x IQGeo's revenue of £44.5 million for FY2023;
·
48.1x IQGeo's Adjusted EBITDA of £6.6 million for FY2023;
and
·
139.6x IQGeo's Adjusted EBITDAC of £2.3 million for
FY2023.
The Cash Offer provides certain value for
shareholders at a premium of approximately:
·
48 per cent. to the twelve-month volume weighted average
price of 325 pence per IQGeo Share to 13 May 2024 (being the Latest
Practicable Date);
·
36 per cent. to the six-month volume weighted average price
of 352 pence per IQGeo Share to the Latest Practicable Date;
and
·
19 per cent. to the Closing Price of 405 pence per IQGeo
Share on the Latest Practicable Date.
As an alternative to the Cash Offer, Eligible
IQGeo Shareholders may elect to receive 0.1 Topco Investor Share
for each IQGeo Share (the "Alternative Offer"), subject to the
terms and conditions of the Alternative Offer (referred to in
paragraph 13 of this Announcement,
in Appendix 4 to this Announcement and to
be further set out in the Scheme Document).
Eligible IQGeo Shareholders will only be able
to elect for the Alternative Offer in relation to their entire
holding of IQGeo Shares and not part only.
The Topco Investor Shares will be independently
valued and an estimate of the value of the Topco Investor Shares
will be included in the Scheme Document. A summary of the Topco
Investor Shares is set out in paragraph 13
of this Announcement and in Appendix 4
to this Announcement and further details will be included in
the Scheme Document, the Topco Shareholders' Agreement and the
Topco Articles.
If, on or after the date of this Announcement
and on or prior to the Effective Date, any dividend and/or other
distribution and/or return of capital is authorised, declared, made
or paid or becomes payable in respect of IQGeo Shares, Bidco
reserves the right to reduce the cash consideration payable under
the Cash Offer (and, as the case may be, the consideration due
under the Alternative Offer) under the terms of the Acquisition for
the IQGeo Shares by an amount equal to all or part of any such
dividend and/or other distribution and/or return of capital. In
such circumstances, IQGeo Shareholders would be entitled to receive
and retain any such dividend and/or other distribution and/or
return of capital.
If and to the extent that any such dividend,
distribution or return of value is authorised, declared, made or
paid or becomes payable on or prior to the Effective Date, and
Bidco exercises its rights under this paragraph
2 to reduce the consideration payable under the
Cash Offer or, as the case may be, the Alternative Offer, any
reference in this Announcement to the Acquisition, the Cash Offer
and the Alternative Offer shall be deemed to be a reference to the
Acquisition, the Cash Offer and the Alternative Offer respectively
as so reduced.
It is expected that the Scheme Document
(including details of the Court Meeting and the General Meeting),
and the Forms of Proxy and Form of Election accompanying the Scheme
Document, will be published as soon as reasonably practicable, and
in any event within 28 days of this Announcement (unless the Panel
consents to a later date) and the Scheme will become Effective in
Q4 2024, subject to the satisfaction or, where permitted, waiver of
the Conditions set out in the Appendix 1
to this Announcement.
An expected timetable of principal events
relating to the Acquisition and further information on the actions
to be taken by the IQGeo Shareholders will be provided in the
Scheme Document.
3.
Background to and reasons for the Acquisition
KKR has been assessing IQGeo and its business
for a number of months and recognises IQGeo's differentiated and
modern product, proven management team and strong value proposition
for its customers. Moreover, IQGeo operates in a sizeable and
fast-growing geospatial software market, providing critical
software and services to support leading operators within the
telecoms and utility segments across their full lifecycle, from
network design to operation.
KKR sees an opportunity to accelerate IQGeo's
transition towards a recurring software centric business model and
the development of IQGeo's future product roadmap under private
ownership. IQGeo's sector is developing rapidly, as fibre and grid
infrastructure are undergoing major transformation and upgrades to
deliver against national connectivity and sustainability goals. For
this, IQGeo will require significant investment that is likely to
reduce profitability in the short to medium term, but build the
strong operational foundations required to support IQGeo's next
phase of growth, scale its platform globally and drive sustainable
long-term value. As such, KKR believes that moving to private
ownership is in the long-term interest of IQGeo, its customers and
its other stakeholders. Consistent with this approach, KKR is
financing the Cash Offer entirely from equity and has a
conservative approach to leverage to focus cash generation on
investment for the future.
KKR is also strongly positioned to support
IQGeo in these ambitions. By investing from both the KKR Global
Impact Fund and Next Generation Technology Growth Fund, KKR brings
a deep understanding of the operational challenges facing IQGeo's
end-markets as well as extensive technology sector expertise,
including via investments in ReliaQuest, OutSystems and KnowBe4.
KKR sees the opportunity to drive investments at IQGeo
across:
·
Technology: further
expanding the breadth of its software solution suite via
incremental product upgrades and new capabilities;
·
Organisational
processes: scaling key operational areas
including sales and corporate development to sustain IQGeo's
existing commercial momentum;
·
Sustainability:
supporting IQGeo to continue to track and improve product return on
investment to customers while providing a leading solution for the
efficient roll-out and maintenance of new and existing
networks;
·
Customer
relationships: strengthening and growing
IQGeo's customer base with companies deploying fibre and developing
grid infrastructure;
·
International
footprint: supporting IQGeo's international
expansion efforts; and
·
Strategic
M&A: supporting management in accelerating
its inorganic growth strategy should the opportunity arise for
strategic acquisitions which would add incremental product
functionality or access to new customers and/or regions.
KKR is also a major global investor in telecoms
infrastructure, particularly fibre deployment and electricity grid
infrastructure, and has developed a deep understanding of market
dynamics in these two sectors. The Acquisition will provide IQGeo
and its management team with access to KKR's extensive global
network, support from a broad range of KKR tools and dedicated
value creation resources with a view to accelerating IQGeo's
current organic growth momentum delivered with existing
resources.
This offer gives IQGeo's shareholders a price,
and certainty in the context of low trading liquidity and share
price volatility, that reflect IQGeo's strong historical
performance, while allowing KKR to make a long-term commitment to
support the business in achieving its goals and maximising its
potential.
4.
Recommendation
The IQGeo Directors, who have been so advised
by Evercore and Cavendish as to the financial terms of the
Acquisition, consider the terms of the Cash Offer to be fair and
reasonable. In providing advice to the IQGeo Directors, Evercore
and Cavendish have taken into account the commercial assessments of
the IQGeo Directors. Evercore is providing independent financial
advice to the IQGeo Directors for the purposes of Rule 3 of the
Takeover Code.
Accordingly, the IQGeo Directors intend to
unanimously recommend that IQGeo Shareholders vote (or procure
votes) in favour of the Scheme at the Court Meeting and to vote (or
procure votes) in favour of the IQGeo Resolution(s) at the General
Meeting as the IQGeo Directors who (or whose family) beneficially
hold IQGeo Shares have irrevocably undertaken to do (or procure to
be done), in respect of 4,162,181 IQGeo Shares in total,
representing in aggregate approximately 6.7 per cent. of the
ordinary share capital of IQGeo in issue as at the Latest
Practicable Date. These irrevocable undertakings remain binding in
the event a higher competing offer is made for IQGeo by a third
party.
In considering the terms of the Alternative
Offer, Evercore, Cavendish and the IQGeo Directors have considered
the key disadvantages and advantages of electing for the
Alternative Offer outlined below:
Disadvantages
of electing for the Alternative
Offer:
·
The Topco Investor Shares will be:
°
unlisted and will not be admitted to trading on any stock
exchange and will therefore be illiquid. Any assessment of the
value of the Topco Investor Shares should therefore take into
account an individual shareholder's assessment of an appropriate
liquidity discount;
°
non-transferrable (save with the prior consent of KKR
Investor or pursuant to the drag and tag rights), and will be
subject to a right of first offer in favour of KKR Investor and any
Qualified Investor Shareholder; and
°
of uncertain value and there can be no assurance that they
will be capable of being sold in the future or that they will be
capable of being sold at the value to be estimated by Rothschild
& Co in the Scheme Document;
·
Following the Effective Date, the Topco Group will be
controlled by KKR Investor. Qualified Investor Shareholders (but
not any other Investor Shareholder in Topco) will have consent
rights only in respect of a limited number of Reserved Matters.
Investor Shareholders (and, in particular, Investor Shareholders
that are not Qualified Investor Shareholders) will therefore have
limited or no influence over decisions made by Topco in relation to
its investment in IQGeo or in any other business;
·
The percentage ownership in Topco of Investor Shareholders
who do not elect to participate in any further issue of securities
by Topco following the Effective Date may be reduced;
·
Eligible IQGeo Shareholders will only be able to elect for
the Alternative Offer in relation to their entire holding of IQGeo
Shares and not part only; and
·
IQGeo Shareholders will have no certainty as to the number of
Topco Investor Shares they would receive because:
°
the maximum number of Topco Investor Shares available to
IQGeo Shareholders under the Alternative Offer will be limited to
the equivalent of 30 per cent. of the total share capital of Topco
in issue immediately following the issue of the Topco Offer Shares
(as described in paragraph 13 of this
Announcement); and
°
to the extent that elections for the Alternative Offer cannot
be satisfied in full, the entitlement to Topco Investor Shares of
each IQGeo Shareholder who has made a valid election will be
reduced on a pro rata
basis and rounded down to the nearest whole number, and the balance
of the consideration due to such IQGeo Shareholder will be paid in
cash in accordance with the terms of the Cash Offer.
Advantages of
electing for the Alternative Offer:
·
The Alternative Offer allows IQGeo Shareholders to invest
directly in the recapitalised IQGeo Group, providing continued
economic exposure to a private equity owned enterprise without
incurring ongoing management fees;
·
The Alternative Offer allows IQGeo Shareholders to
participate in future value creation and may ultimately deliver
greater value than the Cash Offer (although this cannot be
guaranteed); and
·
The Topco Investor Shares are Topco Ordinary Shares and, save
for those terms summarised above and in paragraph
13 of this Announcement and in Appendix 4 to
this Announcement (and to be further set out in the Scheme
Document, the Topco Articles and the Topco Shareholders'
Agreement), will carry the same voting and economic rights as the
Topco Ordinary Shares held by KKR Investor, including pro rata entitlement to dividends,
distributions and returns of capital and pre-emptive
rights.
Evercore and Cavendish are unable to advise the
IQGeo Directors as to whether or not the financial terms of the
Alternative Offer are fair and reasonable. This is because of the
significant and variable impact of the disadvantages and advantages
of the Alternative Offer for individual IQGeo Shareholders
including, in terms of the advantages, in particular, the ability
to participate in the future value creation of the IQGeo Group, and
in terms of the disadvantages, in particular, the terms of the
Topco Investor Shares including the fact that they are illiquid and
not transferrable (save with the prior consent of KKR Investor or
pursuant to the drag and tag rights), the level of uncertainty in
their future value, and the potential dilution that may result if
an IQGeo Shareholder elected not to participate in any further
issue of securities by Topco in the period following the Effective
Date.
Accordingly, the IQGeo Directors are unable to
form an opinion as to whether or not the terms of the Alternative
Offer are fair and reasonable and are not making any recommendation
to IQGeo Shareholders as to whether or not they should elect for
the Alternative Offer.
IQGeo Shareholders are encouraged to take into
account the key advantages and disadvantages of the Alternative
Offer outlined in this paragraph 4, as
well as their particular circumstances, when deciding whether to
elect for the Alternative Offer. IQGeo Shareholders should also
ascertain whether acquiring or holding Topco Investor Shares is
affected by the laws of the relevant jurisdiction in which they
reside and consider whether Topco Investor Shares are a suitable
investment in light of their own personal circumstances.
Accordingly, IQGeo Shareholders are strongly recommended to seek
their own independent financial, tax and legal advice in light of
their own particular circumstances and investment objectives before
deciding whether to elect for the Alternative Offer. Any decision
to elect for the Alternative Offer should be based on independent
financial, tax and legal advice and full consideration of this
Announcement and the Scheme Document (when published).
5.
Irrevocable undertakings and letters of intent
In addition to the irrevocable undertakings
given by the IQGeo Directors described above, Bidco has also
received irrevocable undertakings from:
·
Kestrel Partners to vote (or procure votes) (i) in favour of
the Scheme at the Court Meeting and the IQGeo Resolution(s) at the
General Meeting and (ii) against any competing proposal, in respect
of 16,294,119 IQGeo Shares, representing approximately 26.4 per
cent. of the ordinary share capital of IQGeo in issue as at the
Latest Practicable Date. This irrevocable undertaking remains
binding in the event a higher competing offer is made for IQGeo by
a third party;
·
Mr Raf Meersman to vote in favour of the Scheme at the Court
Meeting and the IQGeo Resolution(s) at the General Meeting, in
respect of 777,657 IQGeo Shares in total, representing
approximately 1.3 per cent. of the ordinary share capital of IQGeo
in issue as at the Latest Practicable Date. This irrevocable
undertaking remains binding in the event a higher competing offer
is made for IQGeo by a third party; and
·
each of Herald Investment Management Limited and Mr Richard
Terence Green to vote (or procure votes) in favour of the Scheme at
the Court Meeting and the IQGeo Resolution(s) at the General
Meeting, in respect of, in aggregate, 3,455,585 IQGeo Shares,
representing approximately 5.6 per cent. of the ordinary share
capital of IQGeo in issue as at the Latest Practicable
Date.
In addition, Bidco has also received
non-binding letters of intent from Canaccord Genuity Asset
Management and Charles Stanley & Co Ltd to vote (or procure
votes) in favour of the Scheme at the Court Meeting and the IQGeo
Resolution(s) at the General Meeting, in respect of, in aggregate,
11,250,000 IQGeo Shares, representing approximately 18.2 per cent.
of the ordinary share capital of IQGeo in issue as at the Latest
Practicable Date.
Bidco has therefore received irrevocable
undertakings and letters of intent in respect of a total of
35,939,542 IQGeo Shares representing, in aggregate, approximately
58.2 per cent. of IQGeo's ordinary share capital in issue as at the
Latest Practicable Date.
Further details of these irrevocable
undertakings and letters of intent, including the circumstances in
which they may lapse, are set out in Appendix 3
to this Announcement.
6.
Background to and reasons for the recommendation
Background
IQGeo was formed on 31 December 2018 after
Ubisense Group plc disposed of its RTLS SmartSpace technology and
repositioned to focus on the smaller software solutions part of the
business. Since then, IQGeo has become one of the leading providers
of geospatial software solutions to telecommunication and utility
operators globally. Under the leadership of its current management
team and through consistent strategic execution, IQGeo has
delivered strong revenue growth whilst also driving operating
leverage resulting in adjusted EBITDA and net income profitability
in FY2022 and FY2023, respectively.
IQGeo's organic growth has been driven by
product investment, innovation and exceptional sales performance to
land and grow within enterprise telecom and utilities customers. A
key pillar of growth has also been M&A. The acquisitions of
OSPInsight and Comsof brought significant product and geographic
diversity to the business, unlocking growth opportunities in
smaller regional and private network operators, and cross-selling
opportunities within enterprise accounts. IQGeo's success is
reflected in its customer footprint, providing software solutions
to over 500 telecoms and utilities operators globally.
The Board believes IQGeo's AIM listing has
played a vital role in its development. IQGeo's shareholders have
provided equity capital to support the acquisitions of OSPInsight
and Comsof, and the operational and governance procedures required
to be a constituent of AIM have provided an important framework for
the sustainable growth of the business to date.
IQGeo has historically had access to sufficient
capital to invest in organisational processes, product and platform
to achieve strong financial returns. The market has supported the
Company with strong share price performance over recent years, with
the share price having increased more than 2.7x over the last two
years as IQGeo has delivered on its growth and profitability
targets.
The Board believes that IQGeo is now
approaching a potential inflection point, with three key areas of
additional investment likely to be required over the coming years
to accelerate the capture of sizeable opportunities across telecom
and utility end markets.
Firstly, whilst the historical growth achieved
has been exciting, the Board believes that, in light of the
increasing number of complex projects for large Tier-1 customers,
the Company's lean operating structure creates execution risk. The
Board believes that bringing forward long term investments in
people and operational processes may be necessary to sustain
current commercial momentum and maintain operational and service
excellence for its expanding customer base.
Secondly, the Board believes that positioning
the business to capture the longer-term opportunity would require a
step change in product and technology investment and an
acceleration in IQGeo's transition to a predominantly recurring
revenue model. The Board recognises IQGeo operates in a competitive
market and delaying this investment could disadvantage IQGeo in the
longer term against well-capitalised competitors.
Thirdly, the Board believes there is a
significant opportunity to capitalise on acquisition opportunities
of increasing scale as the business develops. This will require
investment in establishing corporate development functions, which
are currently undertaken by the CEO and CFO, as well as access to
additional expertise and capital to compete effectively in a
consolidating market.
Whilst the Board believes that IQGeo can
continue to deliver on current short-term growth expectations
without significantly expanding existing levels of investment in
operational processes, people and research and development, this
could increase execution risk and increased investment will be
required over time to underpin medium and long-term growth
expectations. This additional investment would result in a change
in IQGeo's financial profile, introduce volatility in IQGeo's
financial performance, and inevitably carries an element of
risk.
The Board believes undertaking such investment
as a listed company could be complex and would create market risk
given the potential for shareholders to have differing views on
capital allocation priorities and expectations for future financial
performance. This could have negative implications for IQGeo's
share price, especially in view of its strong recent rise and the
very low levels of liquidity; any decision by a large shareholder
to crystallise value at or around current levels could lead to
downward pressure on the Company's share price.
The Board of IQGeo recognises Bidco's stated
investment plans and intentions for IQGeo and believes that under
Bidco's ownership, and through access to KKR's network and
expertise, IQGeo would be better able to deliver on its strategy
than would otherwise be achievable if IQGeo were to remain listed.
The Board also believes that there is close cultural alignment
between IQGeo and each of KKR's Global Impact and Technology Growth
mandates and under Bidco's ownership, IQGeo could further
accelerate its mission in supporting the global energy transition
and to deliver digital equity globally.
Process
Over the last two years, the Company has
received numerous unsolicited approaches from parties potentially
interested in acquiring it. Although the Board has had discussions
with several such parties, none of them has put forward an offer
that the Board would be prepared to recommend to
shareholders.
In response to two credible and well-qualified
approaches from interested parties in late 2023 and early 2024, the
Board decided to undertake a competitive private sale process under
the Takeover Code in order to establish whether there was a party
prepared to make an offer to shareholders that the Board would be
prepared to recommend. The Board commissioned Evercore to approach
a carefully selected list of the best qualified candidates to
participate in this process.
Having engaged with such parties over several
months, including providing detailed information on the business
under non-disclosure agreements, the Board concluded that the
proposal from Bidco, which followed a period of extensive price
negotiation, was the most attractive for shareholders, the most
immediately deliverable and likely to be most advantageous for the
business and its other stakeholders. Discussions with all other
parties who have approached IQGeo in the past two years or were
involved in the recent process have been terminated.
Reasons for
the recommendation
Following careful consideration, the IQGeo
Directors have concluded that the terms of the Cash Offer reflect
the risk-adjusted fundamental valuation of IQGeo and its future
prospects, and provide shareholders with an opportunity to realise
certain value of their holdings today in cash.
The IQGeo Directors have taken all relevant
factors into account in considering the terms of the Cash Offer,
including:
·
The opportunity for IQGeo Shareholders to
realise a fair and reasonable value for their holdings in cash. In
this context, the Board has considered the historic share price
volatility of IQGeo and the low trading liquidity in its
shares;
·
The implied valuation represents attractive enterprise value
multiples of approximately:
°
14.9x IQGeo's Exit ARR of £21.3 million as at 31 December
2023;
°
20.1x IQGeo's In-year Recurring Revenue of £15.7 million for
FY2023;
°
7.1x IQGeo's revenue of £44.5 million for FY2023;
°
48.1x IQGeo's Adjusted EBITDA of £6.6 million for FY2023;
and
°
139.6x IQGeo's Adjusted EBITDAC of £2.3 million for
FY2023.
·
Certain value for shareholders at a premium of
approximately:
°
48 per cent. to the twelve-month volume weighted average
price of 325 pence per IQGeo Share to 13 May 2024 (being the Latest
Practicable Date);
°
36 per cent. to the six-month volume weighted average price
of 352 pence per IQGeo Share to the Latest Practicable Date;
and
°
19 per cent. to the Closing Price of 405 pence per IQGeo
Share on the Latest Practicable Date.
·
A return of:
°
10.8x the Closing Price of 44.5 pence per IQGeo Share five
years ago on 13 May 2019;
°
3.8x the issue price of 125 pence per IQGeo Share at which
IQGeo undertook a placing to support the acquisition of Comsof on
12 August 2022; and
°
1.9x the Closing Price of 258 pence per IQGeo Share one year
ago on 13 May 2023; and
·
the certainty of the Cash Offer should be weighed against the
risk associated with the delivery of future potential value and
share price performance, with or without accelerated near term
investment, particularly in the context of market and broader
macroeconomic environment volatility.
In addition, the IQGeo Directors are pleased to
note Bidco's stated intentions concerning IQGeo's strategy, growth
plans, management and employees, and other stakeholders of IQGeo.
The IQGeo Directors also welcome Bidco's confirmation that,
following completion of the Acquisition, the existing employment
rights, including pension rights, of the management and employees
of IQGeo will be fully safeguarded. The IQGeo Directors are also
pleased to note Bidco's conservative approach to leverage to focus
cash generation on investment for the future.
Therefore, having taken into account all
relevant factors, including those set out above as well as the
results of the competitive private sale process set out above, the
IQGeo Directors intend to recommend unanimously to IQGeo
Shareholders the Acquisition of IQGeo by Bidco.
7.
Information relating to IQGeo
IQGeo is a leading global provider of
geospatial software solutions to telecommunication and utility
operators. IQGeo's award-winning network management software is
"Building Better Networks" within operators through greater
collaboration and process efficiency across the operational
lifecycle, from planning and design to construction, operations,
and sales optimisation.
IQGeo partners with a diverse range of over 500
clients including large multinational telecommunication and utility
companies and smaller regional and private network operators to
deliver the digital innovation required to increase network
resilience, operational safety, and business return on investment.
IQGeo's mission is to provide operators with the innovative
software needed to manage the increasingly complex fibre networks
and electric grids that are fundamental to delivering digital
equity to communities and to the net-zero carbon economy of the
future.
In January 2019, after Ubisense Group plc
disposed of its RTLS SmartSpace technology and brand, it changed
its name to IQGeo Group plc and repositioned to focus on its
geospatial software solutions business. IQGeo is
headquartered in Cambridge, UK, and currently employs over 200
professionals across offices in the UK, US, Canada, Belgium,
Germany, Japan, and Malaysia. The IQGeo Shares are admitted to
trading on the AIM Market of the London Stock Exchange.
8.
Information relating to KKR and Bidco
KKR is a leading global investment firm that
offers alternative asset management as well as capital markets and
insurance solutions, with approximately US$578 billion in assets
under management as of Q1 2024. KKR aims to generate attractive
investment returns by following a patient and disciplined
investment approach, employing world-class people, and supporting
growth in its portfolio companies and communities.
KKR will invest in the Acquisition largely
through KKR's Global Impact Fund II, a US$2.8 billion fund
dedicated to investing in companies whose products and services
contribute measurable progress toward the United Nations
Sustainable Development Goals, as well as through KKR's Next
Generation Technology Growth Fund III, an approximately US$3
billion fund dedicated to growth equity investment opportunities in
the technology space.
KKR established the Global Impact Strategy in
2018 to take a focused and differentiated private equity investment
approach, offering the potential for attractive risk-adjusted
return opportunities in the global impact space. Seeking to
leverage KKR's decades-long industry expertise, and its broad
network of proprietary relationships, investment sourcing, asset
selection and sustainability capabilities, the Global Impact
Strategy takes a commercial-first approach that focuses on
generating both attractive risk-adjusted returns and capitalising,
building, and growing companies with measurable social and/or
environmental impact.
In 2023, KKR closed its third Tech Growth Fund,
Next Generation Technology Growth Fund III, a fund dedicated to
growth equity investment opportunities in the technology space. KKR
has established a proven track record of supporting
technology-focused growth companies, having invested over US$21.6
billion in related investments since 2014 and built a dedicated
global team with deep technology growth equity
expertise.
Bidco is a newly formed company wholly-owned by
funds advised by Kohlberg Kravis Roberts & Co. L.P. and its
affiliates.
9.
Management, employees, pensions, research and development and
locations
Bidco's strategic plans for
IQGeo
As set out in paragraph 3
of this Announcement, Bidco believes that the Acquisition
represents an attractive opportunity to support IQGeo through the
next phase of its growth.
Bidco is supportive of IQGeo's publicly stated
strategy to continue its journey towards scaling into a significant
global provider of geospatial software for network planning and
operations across the telecom and utilities sectors. Bidco intends
to provide access to its global network and operational expertise
to support IQGeo's strategy under private ownership. Bidco believes
that under its ownership, IQGeo will be able to enhance its future
growth ambitions and deliver incremental value to stakeholders
through investment in scaling organisational processes and new
product development. Bidco also intends to support IQGeo's
management in accelerating IQGeo's inorganic growth
strategy.
Bidco confirms it has completed a period of
confirmatory due diligence on IQGeo prior to the date of this
Announcement. Bidco is supportive of the current business
trajectory but would require incremental access to sufficiently
detailed operational information and further analysis to formulate
a strategy for IQGeo going forward. Following the Scheme becoming
Effective, Bidco intends to conduct, together with the management
team, a detailed review of IQGeo's business and operations, and
expects to complete that review within approximately 12 months from
the Effective Date. Bidco expects the review to include, among
other topics:
·
IQGeo's public company related functions;
·
assessing the business' capabilities in place to continue to
drive software revenue growth across both new and existing
customers as part of IQGeo's envisaged transition towards a higher
degree of recurring revenue;
·
identifying the operational areas requiring further
investment to be able to deliver on management's growth ambitions
including, but not limited to, sales, customer support and
corporate development;
·
identifying areas to invest in to support the future product
and R&D roadmap;
·
evaluating customer opportunities to continue to scale in
international markets; and
·
identifying and executing acquisition opportunities to expand
the current product offering, realising the large addressable
market opportunities that IQGeo faces.
Management and
employees
Bidco attaches great importance to the skills
and experience of the IQGeo Group's management and employees. Bidco
is looking forward to working with IQGeo's management team and
employees to support the future development of IQGeo and to ensure
that the business continues to thrive as a private company, thereby
offering greater opportunities for IQGeo's staff, particularly in
terms of activities that pertain to developing and expanding its
position on a global basis.
Once IQGeo ceases to be a publicly-listed
company, Bidco intends that some of the public company-related
functions may be refocused to provide value-add activities in a
growing private company to help realise the opportunity of the
available addressable market. The majority of these functions are
outsourced so Bidco does not intend there to be any material
headcount reductions in such functions or otherwise following
completion of the Acquisition. Bidco confirms that its intention is
to seek to reassign individuals impacted where possible and it will
comply with applicable law (including any information and
consultation obligations) in connection with any headcount
reductions.
In addition, and consistent with IQGeo's move
to private ownership, some or all of the non-executive IQGeo
Directors may also resign from their office as a director of IQGeo
on or shortly after the Effective Date.
Other than as described above, Bidco's strategy
is growth orientated and therefore does not expect or intend for
the Acquisition to have any material impact on the continued
employment or the balance of skills and functions of the management
team and employees of the IQGeo Group.
Existing employment rights and pension
schemes
Bidco confirms that, following completion of
the Acquisition, it will safeguard the existing contractual and
statutory employment rights, including pension rights, of the
employees of the IQGeo Group in accordance with applicable law.
Bidco does not intend to make any material change to the conditions
of employment or the defined contribution pension arrangements
operated by the IQGeo Group in respect of its employees in the
United Kingdom (including with regard to the employer
contributions, the accrual of benefits for existing members and the
admission of new members) following completion of the
Acquisition.
Bidco notes that IQGeo has no defined benefit
pension arrangements in place and does not intend to make any
change in this respect.
Management incentivisation
arrangements
Bidco has not entered into, and has not
discussed any form of, incentivisation arrangements with members of
IQGeo's management. Bidco intends to discuss the adoption of
appropriate incentivisation arrangements for the IQGeo management
team following completion of the Acquisition.
Locations, headquarters, fixed assets
and research and development
Bidco has no plans to change the locations of
IQGeo's headquarters, headquarter functions (other than in relation
to the refocussing of the public company-related functions as
outlined above) or places of business, or to redeploy any fixed
assets of IQGeo.
Bidco does not intend to make any changes to
IQGeo's research and development functions, except for potential
investments to strengthen these capabilities.
Trading facilities
The IQGeo Shares are currently admitted to
trading on AIM and, as set out in paragraph 15
of this Announcement, it is intended that an application will
be made to the London Stock Exchange to cancel the admission to
trading of IQGeo Shares on AIM, with such cancellation expected to
take effect shortly after the Effective Date. IQGeo will be
re-registered as a private company following the Effective
Date.
None of the statements in this paragraph
9 constitute "post-offer undertakings" for the
purposes of Rule 19.5 of the Takeover Code.
10. IQGeo
Share Plans
Participants in the IQGeo Share Plans will be
contacted regarding the effect of the Acquisition on their rights
under the IQGeo Share Plans and, appropriate proposals, which
reflect their rights under the IQGeo Share Plans will be made to
such participants in due course.
The Acquisition will apply to any
IQGeo Shares which are unconditionally allotted
and issued to satisfy the exercise of options under the
IQGeo Share Plans before the Scheme Record Time.
Any IQGeo Shares allotted and issued to
satisfy the exercise of options under the IQGeo
Share Plans after the Scheme Record Time will, subject to the
Scheme becoming Effective and the proposed amendments to the IQGeo
Articles being approved at the General Meeting, be immediately
transferred to Bidco in exchange for the
same consideration as IQGeo Shareholders
will be entitled to receive under the Scheme.
11.
Financing
The cash consideration payable by Bidco
pursuant to the Acquisition will be funded by equity to be drawn
from funds, vehicles and/or accounts advised and/or managed by
KKR.
Rothschild & Co, as financial adviser to
Bidco and KKR, is satisfied that sufficient resources are available
to Bidco to enable it to satisfy in full the cash consideration
payable under the terms of the Acquisition.
Further information on the financing of the
Acquisition will be set out in the Scheme Document.
12.
Offer-related arrangements
Confidentiality
Agreement
On 25 March 2024, Kohlberg Kravis
Roberts & Co. Partners LLP and IQGeo entered into a
confidentiality agreement (the "Confidentiality Agreement") in
connection with the Acquisition, pursuant to which, amongst other
things, Kohlberg Kravis Roberts & Co. Partners LLP has
undertaken to keep confidential information relating to IQGeo
and/or to the Acquisition and not to disclose it to third parties
(with certain exceptions). These confidentiality obligations will
remain in force until 25 March 2026.
The Confidentiality Agreement also contains
undertakings from KKR that, for a period of nine
months from the date of the Confidentiality Agreement, it shall not
solicit or endeavour to entice away certain employees of IQGeo or
the IQGeo Group.
The Confidentiality Agreement also contains
standstill provisions which restricted Kohlberg Kravis
Roberts & Co. Partners LLP from acquiring or seeking to acquire
interests in the securities of IQGeo, with those restrictions
ceasing to apply upon the release of this Announcement.
Co-operation Agreement
On 14 May 2024, Bidco and IQGeo
entered into a co-operation agreement ("Co-operation Agreement") in relation to the
Acquisition. Pursuant to the Co-operation Agreement, amongst other
things:
·
Bidco has agreed to use all reasonable endeavours to
obtain, and make any necessary filings in relation to,
the regulatory clearances and authorisations necessary
to satisfy the Conditions set out in paragraphs 3(a) to
(d) of Part A of Appendix 1 to this Announcement as
soon as reasonably practicable and in any event in sufficient time
to enable the Effective Date to occur prior to the Long Stop Date,
subject to certain customary carve-outs;
·
the parties have agreed to (i) implement certain arrangements
with respect to the IQGeo Share Plans; and (ii) certain provisions
if the Acquisition should switch to a Takeover Offer;
and
·
Bidco has also agreed to provide IQGeo with certain
information for the purposes of the Scheme Document and to
otherwise assist with the preparation of the Scheme
Document.
The Co-operation Agreement shall terminate,
amongst other things:
·
if agreed in writing between Bidco and IQGeo, at any time
prior to the Effective Date;
·
upon written notice served by Bidco to IQGeo if (i) prior to
the Long Stop Date, a third party announces a firm intention to
make an offer or revised offer (whether or not subject to the
satisfaction or waiver of any pre-conditions) for IQGeo, which is
recommended, in whole or in part, by the IQGeo Directors and/or
(ii) the IQGeo Director's recommendation in respect of the
Acquisition changes in a manner that is adverse in the context of
the Acquisition;
·
upon written notice by either Bidco or IQGeo to the other if:
(i) prior to the Long Stop Date, any Condition has
been invoked by Bidco (where the invocation of the relevant
Condition is permitted by the Panel); (ii) prior to the Long Stop
Date, a third party announces a firm intention to make an offer or
revised offer (whether or not subject to the satisfaction or waiver
of any pre-conditions) for IQGeo, which completes, becomes
effective or is declared or becomes unconditional; and/or (iii)
where the Acquisition is being implemented by a Scheme, if the
Scheme is not approved by the requisite majority of the holders of
Scheme Shares at the Court Meeting and/or requisite majority of the
IQGeo Shareholders do not pass the resolutions at the IQGeo General
Meeting necessary to approve, implement and effect the Scheme, or
the Court refuses to sanction the Scheme;
·
if the Acquisition (whether implemented by way of the Scheme
or the Takeover Offer) is withdrawn, terminated or lapses in
accordance with its terms prior to the Long Stop Date and, where
required, with the consent of the Panel, unless such withdrawal,
termination or lapse: (i) is as a result of a switch to a Takeover
Offer; or (ii) is to be followed, within five Business Days (or
such other date as Bidco and IQGeo may agree in writing), by a firm
intention announcement (under Rule 2.7 of the Code) made by Bidco
or any person acting in concert with Bidco to implement the
Acquisition by a different offer, scheme or other structure
provided that, unless otherwise agreed in writing between Bidco and
IQGeo: (A) the cash price per IQGeo Share is no less than stated in
this Announcement; and (B) the exchange ratio in respect of the
Alternative Offer is no less than stated in this Announcement and
the terms of the Alternative Offer set out in Appendix
4 to this Announcement are substantially the same (or
more favourable terms apply);
·
the Court Meeting and/or the IQGeo General Meeting are not
held on or before the 22nd day after the expected date for each
such meeting as set out in the Scheme Document, or such later date
agreed in writing between Bidco and IQGeo with the consent of the
Panel and the approval of the Court (if required), except where
such date is missed for logistical or practical reasons outside of
IQGeo's control;
·
unless otherwise agreed by the parties in writing or required
by the Panel, if the Effective Date has not occurred by the Long
Stop Date; and
·
on the Effective Date.
13.
Alternative Offer
Terms of the
Alternative Offer
Under the Alternative Offer, Eligible IQGeo
Shareholders may elect, in respect of all (but not part only) of
their IQGeo Shares, to receive, in lieu of the Cash Offer to which
they are otherwise entitled:
for each IQGeo
Share:
0.1 Topco Investor Share
The number of Topco Investor Shares due to each
IQGeo Shareholder who has made a valid election under the
Alternative Offer will be rounded down to the nearest whole number
of Topco Investor Shares. Fractional entitlements to Topco Investor
Shares will not be allotted or issued to such IQGeo Shareholder and
will be disregarded.
Accordingly, by way of example, if an IQGeo
Shareholder with 1,000 IQGeo Shares validly elects to receive the
Alternative Offer, it will be entitled to receive 100 Topco
Investor Shares.
The maximum number of Topco Investor Shares
available to the IQGeo Shareholders under the Alternative Offer
will be limited to the equivalent of 30 per cent. of the
total share capital of Topco in issue immediately following
the issue of the Topco Offer Shares (as defined below) (the
"Alternative Offer
Maximum").
If valid elections are received from Eligible
IQGeo Shareholders in respect of a number of IQGeo Shares that
would require the issue of Topco Investor Shares exceeding the
Alternative Offer Maximum, such elections will be unable to be
satisfied in full. In these circumstances, the entitlement to Topco
Investor Shares of each IQGeo Shareholder who has made
a valid election will be reduced on a pro rata basis and rounded down to the
nearest whole number, and the balance of the consideration due to
such IQGeo Shareholder will be paid in cash in accordance with the
terms of the Cash Offer.
The availability of the Alternative Offer is
conditional upon valid elections being made in respect of such
number of IQGeo Shares as represent at least 15 per cent. of the
IQGeo Shares in issue at the Scheme Record Time, failing which it
will lapse. In these circumstances, no Topco Investor Shares will
be issued and the consideration payable in respect of each IQGeo
Share will be settled entirely in cash in accordance with the terms
of the Cash Offer.
Eligible IQGeo Shareholders who elect for the
Alternative Offer will, pursuant to a power of attorney to be
included in the Form of Election and/or the Scheme, deliver a fully
executed deed of adherence pursuant to which they will be bound by
the Topco Shareholders' Agreement.
IQGeo Shareholders who do not validly elect for
the Alternative Offer will automatically receive the full amount of
the Cash Offer for their entire holding of IQGeo Shares.
For the purposes of Rule 24.11 of the Code,
Rothschild & Co, as financial adviser to Bidco, will provide an
estimate of the value of a Topco Investor Share, together with the
assumptions, qualifications and caveats forming the basis of its
estimate of value, in a letter to be included in the Scheme
Document.
The issue of any Topco Investor Shares pursuant
to the Alternative Offer will be in accordance with the mechanism
referred to in paragraph 14 of this
Announcement and subject to the Conditions and further terms set
out in Appendix 1 to this Announcement
and to be set out in the Scheme Document. A summary of the
principal rights of the Topco Investor Shares is set out
below and in Appendix 4 to this
Announcement, and further details will be included in
the Scheme Document, the Topco Shareholders' Agreement and the
Topco Articles.
Topco Investor
Shares
The Topco Investor Shares to be issued to
Eligible IQGeo Shareholders who validly elect for the Alternative
Offer will be issued credited as fully paid and will rank
pari passu in all respects
with the Topco Sponsor Shares, including the rights to vote at
general meetings and to receive and retain dividends and other
distributions declared, made or paid by reference to a record date
falling on or after the date of issue of the Topco Investor
Shares.
Topco share
capital as a result of the Acquisition
On or around the Effective Date, Topco will,
subject to the terms and conditions of the Alternative Offer, issue
(i) Topco Investor Shares to those IQGeo Shareholders
who have validly elected to receive the Alternative Offer and (ii)
Topco Sponsor Shares and Topco Redeemable Shares to KKR Investor
(such Topco Investor Shares, Topco Sponsor Shares and Topco
Redeemable Shares, together with any Topco Shares already issued to
KKR Investor prior to the Effective Date, the "Topco Offer Shares"). The Topco Sponsor
Shares and Topco Redeemable Shares to be issued on or around the
Effective Date will be issued at an equivalent value to that of the
Topco Investor Shares.
The Topco Sponsor Shares and the Topco Investor
Shares will comprise 61 per cent. and up to 30 per cent.
respectively of the Topco Offer Shares, with the balance comprised
of Topco Redeemable Shares, provided always that the number of
Topco Redeemable Shares in issue will not exceed the Topco
Redeemable Share Maximum. Any Topco Redeemable Shares which would
cause the total number of Topco Redeemable Shares in issue to
exceed the Topco Redeemable Share Maximum will instead be issued as
Topco Sponsor Shares.
On that basis, and for illustrative purposes
only, in the event the Alternative Offer is taken up in full by
Eligible IQGeo Shareholders, based on Bidco's current estimate
of fees, costs and expenses payable in respect of the
Acquisition and assuming the number of IQGeo Shares issued pursuant
to the IQGeo Share Plans prior to the Effective Date is the maximum
number set out in paragraph 2(b) of Appendix 2
to this Announcement, Topco would, on or around the Effective
Date and subject to the terms and conditions of the Alternative
Offer, have in issue around (inclusive of any Topco Shares already
issued to KKR Investor prior to the Effective Date):
·
4,534,271 Topco Sponsor Shares and 668,990 Topco Redeemable
Shares issued to KKR Investor to fund the cash consideration
payable under the Acquisition and fees, costs and expenses payable
in respect of the Acquisition; and
·
2,229,969 Topco Investor Shares issued to those IQGeo
Shareholders who validly elect to receive the Alternative
Offer.
If, however, the Alternative Offer were
accepted in respect of less than the Alternative Offer Maximum, the
number of Topco Investor Shares would be reduced accordingly, and
the balance of the Topco Offer Shares will instead be issued in the
form of (i) additional Topco Redeemable Shares up to the Topco
Redeemable Share Maximum; and (ii) additional Topco Sponsor Shares
(for the balance).
Topco
Redeemable Shares and re-financing
The Topco Redeemable Shares are a temporary
instrument in the Topco capital structure. They will accrue
interest from issuance at a floating rate of SONIA plus 2.05 per
cent. per year (the "Yield") and will rank senior to the
Topco Ordinary Shares for any dividend or other distribution
(including on a winding up). They will be redeemable by Topco at a
redemption price equal to the sum of (i) the Topco Redeemable Share
Subscription Amount and (ii) the accrued Yield. The Topco
Redeemable Shares will carry voting rights.
It is intended that, within 90 days following
the Effective Date, Topco will re-finance the Topco Redeemable
Shares. This refinancing is currently expected to be effected by
way of an issue of additional Topco Ordinary Shares but could be
effected through the issue of a different instrument.
If the re-financing is effected by means of the
issue of additional Topco Ordinary Shares, the number of Topco
Ordinary Shares to be issued will be equal to the number of Topco
Redeemable Shares in issue at the date of the re-financing, at a
subscription price per Topco Ordinary Share equal to the sum of (i)
the Topco Redeemable Share Subscription Amount; and (ii) the Yield
accrued on each Topco Redeemable Share at the time of the
re-financing. All Topco Ordinary Shareholders will be entitled to
participate on a pro rata
pre-emptive basis in proportion to their holdings of Topco Ordinary
Shares (with an ability to subscribe for any excess amount not
taken up by other Topco Ordinary Shareholders). KKR Investor would
expect to participate in any such pre-emptive issue for at least
its pro rata entitlement.
The proceeds from any such issue would be applied by Topco to
redeem the Topco Redeemable Shares.
If any of the Topco Redeemable Shares are not
redeemed at the end of the period of 90 days following the
Effective Date, KKR Investor shall be entitled, within 30 days
thereafter, to exchange all Topco Redeemable Shares in issue at
that time for an equal number of Topco Ordinary Shares. Such
exchange of Topco Redeemable Shares for Topco Ordinary Shares will
not be subject to pre-emption rights in favour of the other Topco
Ordinary Shareholders.
Risk factors
and other investment considerations
A summary of the key rights attaching the Topco
Investor Shares is set out in Appendix 4
to this Announcement and further details will be set out in
the Scheme Document, the Topco Shareholders' Agreement and the
Topco Articles.
The attention of Eligible IQGeo Shareholders
who may be considering electing for the Alternative Offer is drawn
to certain risk factors and other investment considerations
relevant to such an election. These will be set out in full in the
Scheme Document and include, inter alia, the following:
·
following the Effective Date, the Topco Group will be
controlled by KKR Investor. Qualified Investor Shareholders (but
not any other Investor Shareholder) will have consent rights only
in respect of a limited number of reserved matters. Investor
Shareholders (and, in particular, Investor Shareholders that are
not Qualified Investor Shareholders) will therefore have limited or
no influence over decisions made by Topco in relation to its
investment in IQGeo or in any other business;
·
the Topco Investor Shares are unquoted. There is no current
expectation that they will be listed or admitted to trading on any
exchange or market for the trading of securities, and they will
therefore be illiquid;
·
the Topco Investor Shares will not be transferrable (save
with the prior consent of KKR Investor or pursuant to the drag and
tag rights);
·
the value of the Topco Investor Shares will be uncertain and
there can be no assurance that any such securities will be capable
of being sold in the future or that they will be capable of being
sold at the value to be estimated by Rothschild & Co in the
Scheme Document;
·
dividend, other distribution or return of capital in respect
of Topco Investor Shares will not be guaranteed or
secured;
·
further issues of securities by Topco (including any equity
re-financing of the Topco Redeemable Shares) may occur. Any further
issues of equity share capital to KKR Investor will be subject to
pre-emption rights in favour of all Topco Ordinary Shareholders
(including those held by Investor Shareholders), subject to
customary exceptions;
·
in relation to any such further issues of equity securities
(other than any equity re-financing of the Topco Redeemable
Shares), if Investor Shareholders wish to avoid their percentage
interest in Topco being reduced by any such issue, they will need
to invest further cash sums in Topco. In particular, Investor
Shareholders who do not elect to exercise their pre-emption rights
by investing the necessary cash sums in respect of such further
issues of equity securities by Topco could suffer significant
dilution in their percentage ownership of Topco;
·
the right of Investor Shareholders to participate in future
issues of equity securities by Topco will also be subject to other
customary and important exceptions. For example, Investor
Shareholders will not be entitled to participate in any issues of
equity securities (i) in connection with a management incentive
plan; (ii) as consideration for any acquisition or business
combination; or (ii) as "equity kickers" to providers of debt
financing;
·
if Bidco introduces one or more management incentive plans
for actual or potential employees, directors, officers and
consultants of the Topco Group after the Effective Date that
provides participants with an interest in securities in the Topco
Group, such issue(s) could potentially significantly dilute the
interest of the Investor Shareholders. In addition, the Topco Group
may not receive material cash sums as consideration for the issue
of any such securities and the returns on any such securities may
be structured to increase their proportionate interest in Topco
Group if it increases in value (whether pursuant to a ratchet
mechanism or otherwise); and
·
the precise numbers of securities that may be issued by Topco
from time to time cannot be ascertained at the date of this
Announcement and will depend on a variety of factors including
those described above.
The
Alternative Offer is not being offered, sold or delivered, directly
or indirectly, in or into any Restricted Jurisdiction and
individual acceptances of the Alternative Offer will only be valid
if all regulatory approvals required by an IQGeo Shareholder to
acquire the Topco Investor Shares have been
obtained.
In addition,
Eligible IQGeo Shareholders who elect for the Alternative Offer
will be required to provide certain "Know Your Client" information
as requested by Bidco and KKR.
14. Structure
of the Acquisition
Structure and
mechanism
It is intended that the Acquisition will be
implemented by means of a Court-approved scheme of arrangement
between IQGeo and the Scheme Shareholders under Part 26 of the
Companies Act. Bidco reserves the right to elect to effect the
Acquisition by way of a Takeover Offer (subject to the consent of
the Panel (where necessary) and the terms of the Co-operation
Agreement).
The purpose of the Scheme is to provide for
Bidco to become the holder of the entire issued and to be issued
ordinary share capital of IQGeo. This is to be achieved by the
transfer of the Scheme Shares to Bidco, in consideration for
which:
·
Scheme Shareholders who have not elected for the Alternative
Offer will receive 480 pence for each Scheme Share held at the
Scheme Record Time; and
·
IQGeo Shareholders who have made a valid election for the
Alternative Offer will receive 0.1 Topco Investor Share for each
Scheme Share held at the Scheme Record Time on the basis set out in
paragraph 13 of this
Announcement,
in each case to be effected pursuant to the
Scheme.
The cash consideration payable under the Cash
Offer will be despatched to IQGeo Shareholders within 14 days of
the Effective Date.
Eligible IQGeo Shareholders that validly elect
for the Alternative Offer will receive their Topco Investor Shares
pursuant to a mechanism in the Scheme whereby on or shortly
following the Effective Date (and in any case within 14 days of the
Effective Date) they will receive loan notes (or other instruments)
to be issued by Bidco which may then be exchanged, directly or
indirectly, for the relevant number of Topco Investor Shares that
the Eligible IQGeo Shareholders are entitled to in accordance with
the terms of the Alternative Offer.
Conditions to
the Acquisition
The Acquisition is subject to the Conditions,
certain further terms referred to in Appendix 1
to this Announcement and the full terms and conditions to be
set out in the Scheme Document, and will only become Effective if,
among other things, the following events occur on or before the
Long Stop Date:
·
a resolution to approve the Scheme is passed by a majority in
number of the Scheme Shareholders present and voting (and entitled
to vote) at the Court Meeting, either in person or by proxy,
representing at least 75 per cent. in value of the Scheme Shares
voted by those Scheme Shareholders;
·
the IQGeo Resolution(s) required to implement the Scheme are
duly passed by IQGeo Shareholders at the General Meeting (which
will require approval of IQGeo Shareholders representing at least
75 per cent. of the votes validly cast at such General Meeting,
either in person or by proxy);
·
following the Court Meeting and the General Meeting, the
Scheme is sanctioned by the Court (without modification, or with
modification on terms agreed by Bidco and IQGeo); and
·
following such sanction, a copy of the Court Order is
delivered to the Registrar of Companies.
The Conditions in paragraph
2 of Part A of
Appendix 1 to this Announcement provide that the
Scheme will lapse if:
·
the Court Meeting and the General Meeting are not held on or
before the 22nd day after the expected date of such
meetings to be set out in the Scheme Document in due course (or
such later date, if any, (a) as Bidco and IQGeo may agree or (b)
(in a competitive situation) as may be specified by Bidco with the
consent of the Panel, and in each case that (if so required) the
Court may allow);
·
the Court hearing to sanction the Scheme is not held on or
before the 22nd day after the expected date of such
hearing to be set out in the Scheme Document in due course (or such
later date, if any, (a) as Bidco and IQGeo may agree or (b) (in a
competitive situation) as may be specified by Bidco with the
consent of the Panel, and in each case that (if so required) the
Court may allow); or
·
the Scheme does not become Effective on or before the Long
Stop Date (or such later date, if any, (a) as Bidco and IQGeo may
agree or (b) (in a competitive situation) as may be specified by
Bidco with the consent of the Panel, and in each case that (if so
required) the Court may allow).
The Acquisition will also be conditional upon
the receipt of antitrust clearance in Cyprus as well as regulatory
clearances (or the expiry of relevant waiting periods) in Belgium,
Germany and the UK.
Effect of the
Scheme and publication of the Scheme Document
Subject to the satisfaction (or, where
applicable, waiver) of the Conditions and the further terms set out
in Appendix 1 to this Announcement, the
Scheme is expected to become Effective in Q4 2024.
Upon the Scheme becoming Effective: (i) it will
be binding on all Scheme Shareholders, irrespective of whether or
not they attended or voted at the Court Meeting or the General
Meeting (and if they attended and voted, whether or not they voted
in favour); and (ii) entitlements to IQGeo Shares held within the
CREST system will be cancelled; and (iii) share certificates in
respect of IQGeo Shares will cease to be valid.
Any IQGeo Shares issued before the Scheme
Record Time will be subject to the terms of the Scheme. The IQGeo
Resolution(s) at the General Meeting will, amongst other matters,
provide that the IQGeo Articles be amended to incorporate
provisions requiring any IQGeo Shares issued after the Scheme
Record Time (other than to Bidco and/or its nominees) to be
automatically transferred to Bidco (and, where applicable, for the
cash consideration to be paid to the original recipient of the
IQGeo Shares so issued) on the same terms as the Cash Offer (other
than terms as to timings and formalities). The provisions of the
IQGeo Articles (as amended) will avoid any person (other than Bidco
and its nominees) holding shares in the capital of IQGeo after the
Effective Date.
Further details of the Scheme, including
expected times and dates for each of the Court Meeting, the General
Meeting and the Court hearing to sanction the Scheme, together with
notices of the Court Meeting and General Meeting, will be set out
in the Scheme Document, which, together with the associated Forms
of Proxy and Form of Election, will be made available to IQGeo
Shareholders as soon as reasonably practicable, and in any event
within 28 days of this Announcement (unless the Panel consents to a
later date), and the meetings are expected to be held shortly
thereafter. The General Meeting is expected to be held immediately
after the Court Meeting.
The Scheme will be governed by English law and
is subject to the jurisdiction of the Court. The Scheme will also
be subject to the applicable requirements of the Takeover Code, the
Panel, the London Stock Exchange (including the AIM Rules) and the
Financial Conduct Authority.
15.
De-listing and re-registration
It is intended that an application will be made
to the London Stock Exchange to cancel the admission to trading in
IQGeo Shares on AIM, with such cancellation expected to take effect
shortly after the Effective Date. The last day of dealings in, and
registration of transfers of, IQGeo Shares on AIM is expected to be
the date of the Court hearing to sanction the Scheme and no
transfers will be registered after 6.00 pm (London time) on that
date.
On the Effective Date, share certificates in
respect of IQGeo Shares will cease to be valid and entitlements to
IQGeo Shares held within the CREST system will be cancelled. IQGeo
Shareholders shall be required to return share certificates to
IQGeo or destroy them following the Effective Date.
It is also proposed that, following the
Effective Date and after its shares are delisted, IQGeo will be
re-registered as a private limited company under the relevant
provisions of the Companies Act.
16.
Disclosure of interests in IQGeo
As at the close of business on the Latest
Practicable Date, save for the irrevocable undertakings and letters
of intent referred to in paragraph 5 of
this Announcement, neither Bidco, nor any of its directors, nor, so
far as Bidco is aware, any person acting in concert (within the
meaning of the Takeover Code) with any of them for the purposes of
the Acquisition had:
(i) any
interest in or right to subscribe for any relevant securities of
IQGeo;
(ii)
any short positions in respect of relevant securities of IQGeo
(whether conditional or absolute and whether in the money or
otherwise), including any short position under a derivative, any
agreement to sell or any delivery obligation or right to require
another person to purchase or take delivery;
(iii)
borrowed or lent any relevant securities of IQGeo (including, for
these purposes, any financial collateral arrangements of the kind
referred to in Note 4 on Rule 4.6 of the Takeover Code), save for
any borrowed relevant securities of IQGeo which had been either
on-lent or sold; or
(iv)
entered into any dealing arrangement of the kind referred to in
Note 11 on the definition of acting in concert in the Takeover
Code.
"Interests in
securities" for these purposes arise, in summary, when a
person has long economic exposure, whether absolute or conditional,
to changes in the price of securities (and a person who only has a
short position in securities is not treated as interested in those
securities). In particular, a person will be treated as having an
'interest' by virtue of the ownership, voting rights or control of
securities, or by virtue of any agreement to purchase, option in
respect of, or derivative referenced to, securities.
It has not been possible for Bidco to make
enquiries of all of its concert parties in advance of the release
of this Announcement. Therefore, if Bidco becomes aware, following
the making of such enquiries, that any of its concert parties have
any interests in relevant securities of IQGeo, all relevant details
in respect of Bidco's concert parties will be included in the
Opening Position Disclosure in accordance with Rule 8.1(a) and Note
2(a)(i) on Rule 8 of the Takeover Code.
17.
General
Bidco reserves the right to elect (with the
consent of the Panel (where necessary), and subject to the terms of
the Co-operation Agreement) to implement the Acquisition by way of
a Takeover Offer for the entire issued and to be issued ordinary
share capital of IQGeo as an alternative to the Scheme. In such
event, the Acquisition will be implemented on substantially the
same terms, so far as applicable, as those which would apply to the
Scheme, subject to appropriate amendments to reflect, among other
things, the change in method effecting the Acquisition (including,
without limitation) inclusion of an acceptance condition set at not
more than 75 per cent. of the IQGeo Shares (unless with the consent
of IQGeo or required by the Panel) where the election to proceed by
way of a Takeover Offer is an agreed switch under the terms of the
Co-operation Agreement and otherwise set at 90 per cent. of the
IQGeo Shares to which the Takeover Offer relates (or such lesser
percentage as Bidco may decide after, to the extent necessary,
consultation with the Panel, being in any case more than 50 per
cent. of the IQGeo Shares), the inclusion of a long-stop date on
which the Takeover Offer will cease to proceed, will lapse or will
be withdrawn in certain circumstances, and those amendments
required by, or deemed appropriate by, Bidco under applicable
law.
The Acquisition will be subject to the
Conditions and further terms set out in Appendix
1 to this Announcement and the full terms and
conditions to be set out in the Scheme Document in due course. The
sources and bases of certain financial information contained in
this Announcement are set out in Appendix 2
to this Announcement. A summary of the irrevocable
undertakings and letters of intent given in relation to the
Acquisition is contained in Appendix 3 to this Announcement. The
details of Topco, the Topco Investor Shares and eligibility to
subscribe for the Topco Investor Shares are contained in Appendix 4
to this Announcement. Certain terms used in this Announcement are
defined in Appendix 5 to this
Announcement.
Rothschild & Co, Evercore and Cavendish
have each given and not withdrawn their consent to the inclusion in
this Announcement of the references to their names in the form and
context in which they appear.
This Announcement does not constitute an offer
or an invitation to purchase or subscribe for any securities. Such
offer will be contained in the Scheme Document. IQGeo Shareholders
are advised to read carefully the Scheme Document and associated
Forms of Proxy and Form of Election once they have been
dispatched.
The availability of the Acquisition (including
the Alternative Offer) to IQGeo Shareholders who are not resident
in and citizens of the United Kingdom may be affected by the laws
of the relevant jurisdictions in which they are located or of which
they are citizens. Persons who are not resident in the United
Kingdom should inform themselves of, and observe, any applicable
legal or regulatory requirements of their jurisdictions. IQGeo
Shareholders who are in any doubt regarding such matters should
consult an appropriate independent professional adviser in the
relevant jurisdiction without delay.
18. Documents
available on website
Copies of the following documents will be made
available on Bidco's and IQGeo's websites at
https://www.documentdisplay.com and
https://www.IQGeo.com/investor-center/disclaimer-offer respectively
until the end of the Acquisition:
·
this Announcement;
·
the irrevocable undertakings and letters of intent referred
to in paragraph 5 of this Announcement
and summarised in Appendix 3 to this
Announcement;
·
the equity commitment letter entered into by (amongst others)
Bidco in connection with the financing of the Acquisition as
described in paragraph 11 of this
Announcement;
·
the Confidentiality Agreement referred to in paragraph
12 of this Announcement;
·
the Co-operation Agreement referred to in paragraph
12 of this Announcement; and
·
the written consent letter from each of Rothschild & Co,
Evercore and Cavendish as referred to in paragraph
17 of this Announcement.
The contents of the websites referred to in
this Announcement and any websites accessible from hyperlinks on
these websites are not incorporated into and do not form part of
this Announcement.
Enquiries:
Rothschild & Co (Financial Adviser
to Bidco and KKR)
|
+44 (0) 20 7280 5000
|
Anton Black
|
|
Philippe Noël
|
|
Tom Buggé
|
|
Tom Guinness
|
|
|
|
FGS Global (PR
Adviser to KKR)
|
KKR-LON@fgsglobal.com
|
Alastair Elwen
|
44 (0) 20 725 13801
|
Jack Shelley
|
|
|
|
IQGeo
|
+44 (0) 12 2360 6655
|
Richard Petti, CEO
|
|
Haywood Chapman, CFO
|
|
|
|
Evercore (Lead
Financial Adviser to IQGeo)
|
+44 (0) 20 7653 6000
|
Ed Banks
|
|
Anil Rachwani
|
|
Harrison George
|
|
|
|
Cavendish (Joint Financial Adviser,
Nomad, Broker to IQGeo)
|
+44 (0) 20 7220 0500
|
Henrik Persson
|
|
Tim Redfern
|
|
Seamus Fricker
|
|
|
|
H/Advisors
Maitland (PR Adviser to IQGeo)
|
IQGeo@h-advisors.global
|
Neil Bennett
|
+44 (0) 20 7379 5151
|
Clifford Chance LLP is acting as legal adviser
to Bidco and KKR. DAC Beachcroft LLP is acting as legal adviser to
IQGeo.
Important notices about financial
advisers
N.M.
Rothschild & Sons Limited ("Rothschild & Co"), which is
authorised and regulated by the Financial Conduct Authority in the
United Kingdom is acting exclusively for Bidco and KKR and for
no‑one else in connection with the Acquisition and will not regard
any other person as its client in relation to the Acquisition and
will not be responsible to anyone other than Bidco and KKR for
providing the protections afforded to clients of Rothschild &
Co, nor for providing advice in relation to any matter referred to
in this announcement.
Evercore Partners
International LLP ("Evercore"), which is authorised and
regulated by the Financial Conduct Authority in the United Kingdom,
is acting exclusively as financial adviser to IQGeo
and no one else in connection with the
matters described
in this Announcement and will not be responsible to anyone other
than IQGeo
for providing the protections
afforded to clients of Evercore nor for providing advice in
connection with the matters referred to herein. Neither Evercore
nor any of its subsidiaries, branches or affiliates owes or accepts
any duty, liability or responsibility whatsoever (whether direct or
indirect, whether in contract, in tort, under statute or otherwise)
to any person who is not a client of Evercore in connection with
this Announcement, any statement contained herein, any offer or
otherwise. Apart from the responsibilities and liabilities, if any,
which may be imposed on Evercore by the Financial Services and
Markets Act 2000 and successor legislation, or the regulatory
regime established thereunder, or under the regulatory regime of
any jurisdiction where exclusion of liability under the relevant
regulatory regime would be illegal, void or unenforceable, neither
Evercore nor any of its affiliates accepts any responsibility or
liability whatsoever for the contents of this Announcement, and no
representation, express or implied, is made by it, or purported to
be made on its behalf, in relation to the contents of this
Announcement, including its accuracy, completeness or verification
of any other statement made or purported to be made by it, or on
its behalf, in connection with IQGeo or the matters described in
this Announcement. To the fullest extent permitted by applicable
law, Evercore and its affiliates accordingly disclaim all and any
responsibility or liability whether arising in tort, contract or
otherwise (save as referred to above) which they might otherwise
have in respect of this Announcement or any statement contained
herein.
Cavendish Capital
Markets Limited ("Cavendish"), which is authorised and
regulated by the FCA in the UK, is acting as joint financial
adviser, nominated adviser and corporate broker exclusively for
IQGeo and no one else in connection with the matters referred to in
this Announcement and will not be responsible to anyone other than
IQGeo for providing the protections afforded to its clients or for
providing advice in relation to matters referred to in this
Announcement. Neither Cavendish, nor any of its affiliates, owes or
accepts any duty, liability or responsibility whatsoever (whether
direct or indirect, whether in contract, in tort, under statute or
otherwise) to any person who is not a client of Cavendish in
connection with this announcement, any statement contained herein
or otherwise.
Further Information
This
Announcement is for information purposes only and is not intended
to and does not constitute, or form part of, any offer to sell or
an invitation to purchase any securities or a solicitation of an
offer to buy, otherwise acquire, subscribe for, sell or otherwise
dispose of any securities pursuant to the Acquisition or otherwise,
nor shall there be any purchase, sale, issuance or exchange of
securities or such solicitation in any jurisdiction in which such
offer, solicitation, sale issuance or exchange is unlawful. The
Acquisition will be made solely by means of the Scheme Document (or
any other document by which the Acquisition is made) which will
contain the full terms and conditions of the Acquisition, including
details of how to vote in respect of the Scheme. Any decision in
respect of, or other response to, the Acquisition should be made
only on the basis of the information contained in the Scheme
Document (or any other document by which the Acquisition is
made).
IQGeo will
prepare the Scheme Document to be distributed to IQGeo Shareholders
at no cost to them. IQGeo and Bidco urge IQGeo Shareholders to read
the Scheme Document when it becomes available because it will
contain important information relating to the Acquisition,
including details of how to vote in respect of the
Scheme.
The
statements contained in this Announcement are made as at the date
of this Announcement, unless some other time is specified in
relation to them, and publication of this Announcement shall not
give rise to any implication that there has been no change in the
facts set forth in this Announcement since such
date.
This
Announcement does not constitute a prospectus or prospectus
equivalent document.
Overseas jurisdictions
The release,
publication or distribution of this Announcement in jurisdictions
other than the United Kingdom, and the availability of the
Acquisition (including the Alternative Offer) to IQGeo Shareholders
who are not resident in the United Kingdom, may be restricted by
the laws of those jurisdictions and therefore persons into whose
possession this Announcement comes should inform themselves about
and observe such restrictions. Further details in relation to the
Overseas Shareholders will be contained in the Scheme Document. Any
failure to comply with any such restrictions may constitute a
violation of the securities laws of any such jurisdiction. To the
fullest extent permitted by applicable law, the companies and
persons involved in the Acquisition disclaim any responsibility or
liability for the violation of such restrictions by any
person.
Unless
otherwise determined by Bidco or required by the Takeover Code, and
permitted by applicable law and regulation, the Acquisition will
not be made available, directly or indirectly, in, into or from a
Restricted Jurisdiction. Accordingly, copies of this Announcement
and all documents relating to the Acquisition are not being, and
must not be, directly or indirectly, mailed or otherwise forwarded,
distributed or sent in, into or from a Restricted Jurisdiction, and
persons receiving this Announcement and all documents relating to
the Acquisition (including custodians, nominees and trustees) must
not mail or otherwise distribute or send them in, into or from
such Restricted Jurisdiction. If the Acquisition is implemented by way of
Takeover Offer (unless otherwise permitted by applicable law or
regulation), the Takeover Offer may not be made, directly or
indirectly, in or into or by use of the mails or any other means or
instrumentality (including, without limitation, facsimile, e-mail
or other electronic transmission, telex or telephone) of interstate
or foreign commerce of, or any facility of a national, state or
other securities exchange of any Restricted Jurisdiction and the
Takeover Offer will not be capable of acceptance by any such use,
means, instrumentality or facilities or from within any Restricted
Jurisdiction.
This
Announcement has been prepared in connection with proposals in
relation to a scheme of arrangement pursuant to and for the purpose
of complying with English law and the Takeover Code and information
disclosed may not be the same as that which would have been
disclosed if this Announcement had been prepared in accordance with
the laws of jurisdictions outside the United Kingdom. Nothing in
this Announcement should be relied on for any other
purpose.
The
Acquisition shall be subject to the applicable requirements of the
Takeover Code, the Panel, the London Stock Exchange and the
Financial Conduct Authority.
Additional information for US
investors
The
Acquisition relates to the shares of an English company and is
being made by means of a scheme of arrangement provided for under
English company law. A transaction effected by means of a scheme of
arrangement is not subject to the tender offer or proxy
solicitation rules under the US Exchange Act. Accordingly, the
Acquisition is subject to the disclosure requirements and practices
applicable in the United Kingdom to schemes of arrangement which
differ from the disclosure requirements of the US tender offer and
proxy solicitation rules.
If, in the
future, Bidco exercises its right to implement the Acquisition by
way of a Takeover Offer, which is to be made into the US,
such Takeover Offer will be made in compliance with the
applicable US laws and regulations, including Section 14(e) and
Regulation 14E under the US Exchange Act. Such a
Takeover Offer would be made in the US by Bidco and no one
else.
In the event
that the Acquisition is implemented by way of Takeover Offer, in
compliance with applicable UK laws, Bidco, its dealer manager
(and their advisers or affiliates), or its nominees, or its brokers
(acting as agents), may from time to time make certain purchases
of, or arrangements to purchase, shares or other securities of
IQGeo other than pursuant to such Takeover Offer during the period
in which such Takeover Offer would remain open for acceptance.
These purchases may occur either in the open market at prevailing
prices or in private transactions at negotiated prices. Any
information about such purchases or arrangements to purchase shall
be disclosed as required under UK laws, shall be reported to a
Regulatory Information Service and shall be available on the London
Stock Exchange website at
www.londonstockexchange.com. To the extent that such information is
required to be publicly disclosed in the UK in accordance with
applicable regulatory requirements, this information will, as
applicable, also be made publicly available in the United
States.
It may be
difficult for US holders of IQGeo Shares to enforce their rights
and any claim arising out of the US federal securities laws in
connection with the Acquisition, since Bidco
and IQGeo are located in a
non-US jurisdiction, and some or all of their officers and
directors may be residents of a non-US jurisdiction. US holders of
IQGeo Shares may not be able to sue a non-US company or its
officers or directors in a non-US court for violations of the US
securities laws. Further, it may be difficult to compel a non-US
company and its affiliates to subject themselves to a US court's
judgement.
The Topco
Investor Shares to be issued under the Alternative Offer have not
been registered under the US Securities Act or under any laws or
with any securities regulatory authority of any state, district or
other jurisdiction, of the US and will not be listed on any stock
exchange in the US. The Topco Investor Shares may only be offered
or sold in the US in reliance on an exemption from registration
requirements of the US Securities Act including in the case of the
proposed scheme of arrangement, Section 3(a)(10) thereunder.
Nothing in this Announcement constitutes an offer to sell, or a
solicitation of offers to purchase, Topco Investor
Shares or any loan notes to be
issued by the Topco Group.
The financial
information included in this Announcement, or that may be included
in the Scheme Document, has been prepared in accordance with
accounting standards applicable in the United Kingdom and thus may
not be comparable to financial information of US companies or
companies whose financial statements are prepared in accordance
with generally accepted accounting principles in the US
("US GAAP"). US GAAP
differs in certain significant respects from accounting standards
applicable in the United Kingdom. None of the financial information
in this Announcement has been audited in accordance with auditing
standards generally accepted in the United States or the auditing
standards of the Public Company Accounting Oversight Board (United
States).
Neither the
Acquisition (including the Alternative Offer) nor this Announcement
have been approved or disapproved by the US Securities and Exchange
Commission, any state securities commission in the United States or
any other US regulatory authority, nor have such authorities
approved or disapproved or passed judgement upon the fairness or
the merits of the Acquisition (including the Alternative Offer), or
determined if the information contained in this Announcement is
adequate, accurate or complete. Any representation to the contrary
is a criminal offence in the United States.
The receipt
of cash pursuant to the Acquisition by a US holder as consideration
for the transfer of its IQGeo Shares pursuant to the Acquisition
will likely be a taxable transaction for US federal income tax
purposes and under applicable US state and local, as well as
foreign and other, tax laws. Each US holder of IQGeo
Shares is urged to consult
their independent legal, tax and financial advisers regarding the
tax consequences of the Acquisition applicable to them, including
under applicable US state and local, as well as overseas and other,
tax laws.
Forward-looking
statements
This
Announcement (including information incorporated by reference in
this Announcement), oral statements made regarding the Acquisition,
and other information published by KKR, Bidco or IQGeo may contain
statements about Bidco and IQGeo that are or may be deemed to be
forward looking statements. All statements other than statements of
historical facts included in this Announcement may be forward
looking statements. Without limitation, any statements preceded or
followed by or that include the words "targets", "plans",
"believes", "expects", "aims", "intends", "will", "may", "shall",
"should", "anticipates", "estimates", "projects", "is subject to",
"budget", "scheduled", "forecast" or words or terms of similar
substance or the negative thereof, are forward looking statements.
Forward looking statements include statements relating to the
following: (i) future capital expenditures, expenses, revenues,
earnings, synergies, economic performance, indebtedness, financial
condition, dividend policy, losses and future prospects; (ii)
business and management strategies and the expansion and growth of
Bidco's or IQGeo's operations and potential synergies resulting
from the Acquisition; and (iii) the effects of government
regulation on Bidco's or IQGeo's business.
Such forward
looking statements are prospective in nature and are not based on
historical facts, but rather on current expectations and
projections of the management of Bidco and IQGeo about future
events, and are therefore subject to risks and uncertainties that
could significantly affect expected results and are based on
certain key assumptions. Many factors could cause actual results to
differ materially from those projected or implied in any forward
looking statements, including: increased competition, the loss of
or damage to one or more key customer relationships, changes to
customer ordering patterns, delays in obtaining customer approvals
for engineering or price level changes, the failure of one or more
key suppliers, the outcome of business or industry restructuring,
the outcome of any litigation, changes in economic conditions,
currency fluctuations, changes in interest and tax rates, changes
in raw materials or energy market prices, changes in laws,
regulations or regulatory policies, developments in legal or public
policy doctrines, technological developments, the failure to retain
key management, or the timing and success of future acquisition
opportunities or major investment projects. Other unknown or
unpredictable factors could cause actual results to differ
materially from those in the forward looking statements. Such
forward looking statements should therefore be construed in light
of such factors. Neither Bidco nor IQGeo, nor any of their
respective associates or directors, officers or advisers, provides
any representation, assurance or guarantee that the occurrence of
the events expressed or implied in any forward looking statements
in this Announcement will actually occur. Due to such uncertainties
and risks, readers are cautioned not to place undue reliance on
such forward looking statements, which speak only as of the date
hereof. All subsequent oral or written forward looking statements
attributable to any member of the Bidco Group or the IQGeo Group,
or any of their respective associates, directors, officers,
employees or advisers, are expressly qualified in their entirety by
the cautionary statement above.
Bidco and
IQGeo expressly disclaim any obligation to update any forward
looking or other statements contained herein, except as required by
applicable law or by the rules of any competent regulatory
authority, whether as a result of new information, future events or
otherwise.
No
profit forecasts or profit estimates or quantified financial
benefit statements
No statement
in this Announcement is intended as, or is to be construed as, a
profit forecast, profit estimate or quantified financial benefit
statement for any period and no statement in this Announcement
should be interpreted to mean that earnings or earnings per share
for IQGeo for the current or future financial years would
necessarily match or exceed the historical published earnings or
earnings per share for IQGeo.
Disclosure requirements of the Takeover
Code
Under Rule
8.3(a) of the Takeover Code, any person who is interested in 1% or
more of any class of relevant securities of an offeree company or
of any securities exchange offeror (being any offeror other than an
offeror in respect of which it has been announced that its offer
is, or is likely to be, solely in cash) must make an Opening
Position Disclosure following the commencement of the Offer Period
and, if later, following the announcement in which any securities
exchange offeror is first identified. An Opening Position
Disclosure must contain details of the person's interests and short
positions in, and rights to subscribe for, any relevant securities
of each of (i) the offeree company and (ii) any securities exchange
offeror(s). An Opening Position Disclosure by a person to whom Rule
8.3(a) applies must be made by no later than 3.30 pm (London time)
on the 10th business day following the commencement of the Offer
Period and, if appropriate, by no later than 3.30 pm (London time)
on the 10th business day following the announcement in which any
securities exchange offeror is first identified. Relevant persons
who deal in the relevant securities of the offeree company or of a
securities exchange offeror prior to the deadline for making an
Opening Position Disclosure must instead make a Dealing
Disclosure.
Under Rule
8.3(b) of the Takeover Code, any person who is, or becomes,
interested in 1% or more of any class of relevant securities of the
offeree company or of any securities exchange offeror must make a
Dealing Disclosure if the person deals in any relevant securities
of the offeree company or of any securities exchange offeror. A
Dealing Disclosure must contain details of the dealing concerned
and of the person's interests and short positions in, and rights to
subscribe for, any relevant securities of each of (i) the offeree
company and (ii) any securities exchange offeror(s), save to the
extent that these details have previously been disclosed under Rule
8. A Dealing Disclosure by a person to whom Rule 8.3(b) applies
must be made by no later than 3.30 pm (London time) on the business
day following the date of the relevant dealing.
If two or
more persons act together pursuant to an agreement or
understanding, whether formal or informal, to acquire or control an
interest in relevant securities of an offeree company or a
securities exchange offeror, they will be deemed to be a single
person for the purpose of Rule 8.3.
Opening
Position Disclosures must also be made by the offeree company and
by any offeror and Dealing Disclosures must also be made by the
offeree company, by any offeror and by any persons acting in
concert with any of them (see Rules 8.1, 8.2 and
8.4).
Details of
the offeree and offeror companies in respect of whose relevant
securities Opening Position Disclosures and Dealing Disclosures
must be made can be found in the Disclosure Table on the Panel's
website at www.thetakeoverpanel.org.uk, including details of the
number of relevant securities in issue, when the Offer Period
commenced and when any offeror was first identified. You should
contact the Panel's Market Surveillance Unit on +44 (0)20 7638 0129
if you are in any doubt as to whether you are required to make an
Opening Position Disclosure or a Dealing
Disclosure.
Publication on website
A copy of
this Announcement and the documents required to be published
pursuant to Rule 26 of the Takeover Code will be available, free of
charge, subject to certain restrictions relating to persons
resident in Restricted Jurisdictions, on Bidco's website at
https://www.documentdisplay.com and IQGeo's website at
https://www.IQGeo.com/investor-center/disclaimer-offer by no later
than 12.00 noon (London Time) on the Business Day following the
publication of this Announcement.
For the
avoidance of doubt, the contents of these websites and any websites
accessible from hyperlinks on these websites are not incorporated
into and do not form part of this Announcement.
Information relating to IQGeo
Shareholders
Please be
aware that addresses, electronic addresses and certain other
information provided by IQGeo Shareholders, persons with
information rights and other relevant persons for the receipt of
communications from IQGeo may be provided to Bidco during the Offer
Period as required under Section 4 of Appendix 4 of the Takeover
Code.
Right to receive documents in hard copy
form
In accordance
with Rule 30.3 of the Takeover Code, IQGeo Shareholders,
participants in the IQGeo Share Plans and persons with information
rights may request a hard copy of this Announcement, free of
charge, by contacting IQGeo's registrars, Link Group, at Central
Square, 29 Wellington Street, Leeds, LS1 4DL, United Kingdom or by
calling Link Group on +44 (0)371 664 0300 or via email at
shareholderenquiries@linkgroup.co.uk. Calls are charged at the
standard geographic rate and will vary by provider. Calls outside
the United Kingdom will be charged at the applicable international
rate. Lines are open between 8.30 am to 5.30 pm (London time),
Monday to Friday (except public holidays in England and Wales). For
persons who receive a copy of this Announcement in electronic form
or via a website notification, a hard copy of this Announcement
will not be sent unless so requested. Such persons may also request
that all future documents, announcements and information in
relation to the Acquisition are sent to them in hard copy
form.
Rounding
Certain
figures included in this Announcement have been subjected to
rounding adjustments. Accordingly, figures shown for the same
category presented in different tables may vary slightly and
figures shown as totals in certain tables may not be an arithmetic
aggregation of the figures that precede them.
General
If you are in
any doubt about the contents of this Announcement or the action you
should take, you are recommended to seek your own independent
financial advice immediately from your stockbroker, bank manager,
solicitor or independent financial adviser duly authorised under
FSMA if you are resident in the United Kingdom or, if not, from
another appropriately authorised independent financial
adviser.
Rule 2.9 information
For the
purposes of Rule 2.9 of the Takeover Code, IQGeo confirms that, as
at the Latest Practicable Date, it had in issue 61,723,156 ordinary
shares of 2 pence each. The International Securities Identification
Number for the IQGeo Shares is GB00B3NCXX73.
Appendix 1
CONDITIONS AND FURTHER TERMS OF THE SCHEME AND THE
ACQUISITION
Part A: CONDITIONS TO THE SCHEME AND THE
ACQUISITION
Long Stop
Date
1. The
Acquisition will be conditional upon the Scheme becoming
unconditional and becoming Effective, subject to the Takeover Code,
by not later than the Long Stop Date.
Conditions of
the Scheme
Statutory
Conditions
2. The Scheme
will be subject to the following conditions:
(a)
(i) its approval by a majority in number of the Scheme
Shareholders who are present and voting (and entitled to vote),
either in person or by proxy, at the Court Meeting and at any
separate class meeting which may be required (or any adjournment
thereof), and who represent not less than 75 per cent. in value of
the Scheme Shares voted by those Scheme Shareholders; and (ii) such
Court Meeting and any such separate class meeting (or any
adjournment thereof) being held on or before the 22nd day after the
expected date of the Court Meeting to be set out in the Scheme
Document in due course (or such later date, if any, (a) as Bidco
and IQGeo may agree or (b) (in a competitive situation) as may be
specified by Bidco with the consent of the Panel, and in each case
that (if so required) the Court may allow);
(b)
(i) the IQGeo Resolution(s) being duly passed by the requisite
majority or majorities of IQGeo Shareholders at the General Meeting
(or any adjournment thereof); and (ii) such General Meeting being
held on or before the 22nd day after the expected date of such
meeting to be set out in the Scheme Document in due course (or such
later date, if any, (a) as Bidco and IQGeo may agree or (b) (in a
competitive situation) as may be specified by Bidco with the
consent of the Panel, and in each case that (if so required) the
Court may allow);
(c)
(i) the sanction of the Scheme by the Court (with or without
modification, but subject to any such modification being on terms
acceptable to IQGeo and Bidco) and the delivery of a copy of the
Court Order to the Registrar of Companies; and (ii) Court hearing
to sanction the Scheme being held on or before the 22nd day after
the expected date of such hearing to be set out in the Scheme
Document in due course (or such later date, if any, (a) as Bidco
and IQGeo may agree or (b) (in a competitive situation) as may be
specified by Bidco with the consent of the Panel, and in each case
that (if so required) the Court may allow).
General
Conditions
3. In
addition, subject as stated in Part B below, and to the
requirements of the Panel, Bidco and IQGeo have agreed that the
Acquisition will be conditional upon the following Conditions and,
accordingly, the necessary actions to make the Scheme Effective
will not be taken unless the following Conditions (as amended if
appropriate) have been satisfied or, where relevant,
waived:
Antitrust
Cyprus
(a) a
merger filing having been made and the Commission for the
Protection of Competition of the Republic of Cyprus (the
"CPC"), having either: (i)
confirmed that the Acquisition is not subject to the CPC's
approval; or (ii) approved the Acquisition;
Regulatory
Belgian Cooperation
Agreement
(b)
notification having been made and accepted under the Belgian
Cooperation Agreement of 30 November 2022 ("Belgian Cooperation Agreement") and one of the
following having occurred:
(i) the
Interfederal Screening Commission authorizing the Transaction,
whether unconditionally or subject to conditions, obligations,
undertakings or modification as the decision of the Interfederal
Screening Commission may identify; or
(ii)
the Interfederal Screening Commission not deciding within the time
limits set in the Belgian Cooperation Agreement, as a result of
which the approval of the Acquisition is deemed to be granted
according to Article 18, §2 of the Belgian Cooperation
Agreement;
German Foreign Trade and Payments
Ordinance
(c)
the German Federal Ministry for Economic Affairs and Climate Action
(Bundesministerium für Wirtschaft
und Klimaschutz - "BMWK") having approved the Acquisition,
which shall be deemed fulfilled if:
(i) the BMWK
has issued a certificate of non-objection (Unbedenklichkeitsbescheinigung)
pursuant to section 58(1) sentence 1 of the German Foreign Trade
and Payments Ordinance (Außenwirtschaftsverordnung -
"GFTO") or a clearance
certificate (Freigabe)
pursuant to section 58a(1) sentence 1 GFTO in relation to the
Acquisition; or
(ii)
such certificate of non-objection or clearance certificate is
deemed to have been issued pursuant to section 58(2) GFTO or
section 58a(2) GFTO, in each case in conjunction with section
14a(1) no. 1 and (3) sentence 1 of the German Foreign Trade and
Payments Act (Außenwirtschaftsgesetz - "GFTA") because the BMWK did not
commence a formal investigation of the Acquisition pursuant to
section 55(1) and (3) GFTO within the period prescribed by section
14a(1) no. 1 GFTA; or
(iii) in
the case of a formal investigation pursuant to section 55(1) and
(3) GFTO, the BMWK has, within the period
prescribed by section 59(1) GFTO in conjunction with section
14a(1) no. 2, (6) and (7), either (y) not prohibited the
Acquisition and such period has expired; or (z) issued binding
orders (Anordnungen) in
relation to the Acquisition without prohibiting its
implementation;
UK NSI
Act
(d)
notification having been made and accepted under the UK NSI Act and
one of the following having occurred:
(i) the
Secretary of State confirming before the end of the review period
that no further action will be taken in relation to the
Acquisition; or
(ii)
if the Secretary of State issues a call-in notice in relation to
the Acquisition, the parties receiving a final notification
pursuant to section 26(1)(b) of the UK NSI Act containing
confirmation that the Secretary of State will take no further
action in relation to the call-in notice and the Acquisition under
the UK NSI Act; or
(iii) the
Secretary of State making a final order pursuant to section
26(1)(a) of the UK NSI Act in relation to the Acquisition, save to
the extent that such an order prohibits the Acquisition;
Other third
party clearances
(e)
other than in respect of or in connection with the Conditions set
out in paragraphs 3(a) to
(d), no Third Party having given notice of a
decision to take, institute, implement or threaten any action,
proceeding, suit, investigation, enquiry or reference (and in each
case, not having withdrawn the same), or having required any action
to be taken or otherwise having done anything, or having enacted,
made or proposed any statute, regulation, decision, order or change
to published practice (and in each case, not having withdrawn the
same) and there not continuing to be outstanding any statute,
regulation, decision or order which would or might be expected
to:
(i) require,
prevent or delay the divestiture or alter the terms envisaged for
such divestiture by any member of the Wider Bidco Group or by any
member of the Wider IQGeo Group of all or any part of its
businesses, assets or property or impose any limitation on the
ability of all or any of them to conduct their businesses (or any
part thereof) or to own, control or manage any of their assets or
properties (or any part thereof) to an extent which is material in
the context of the Wider Bidco Group or the Wider IQGeo Group, in
either case taken as a whole;
(ii)
require any member of the Wider Bidco Group or the Wider IQGeo
Group to acquire or offer to acquire any shares, other securities
(or the equivalent) or interest in any member of the Wider IQGeo
Group or the Wider Bidco Group or any asset owned by any third
party (other than in the implementation of the Acquisition, or, if
applicable, pursuant to sections 974 to 991 of the Companies Act),
which is material in the context of the Wider Bidco Group or the
Wider IQGeo Group, in either case taken as a whole;
(iii)
impose any material limitation on, or result in a material delay
in, the ability of any member of the Wider Bidco Group directly or
indirectly to acquire, hold or to exercise effectively all or any
rights of ownership in respect of shares or other securities in, or
to exercise voting or management control over, any member of the
Wider IQGeo Group;
(iv)
otherwise materially adversely affect any or all of the business,
assets, profits, or prospects of any member of the Wider IQGeo
Group or any member of the Wider Bidco Group;
(v)
result in any member of the Wider IQGeo Group or any member of the
Wider Bidco Group ceasing to be able to carry on business under any
name under which it presently carries on business, to an extent
which is material in the context of the Wider Bidco Group or the
Wider IQGeo Group, in either case taken as a whole;
(vi) make
the Acquisition, its implementation or the acquisition of any
shares or other securities in, or control or management of, IQGeo
by any member of the Wider Bidco Group void, unenforceable and/or
illegal under the laws of any relevant jurisdiction, or otherwise,
directly or indirectly prevent or prohibit, restrict, restrain, or
delay or materially interfere with the implementation of, or impose
material additional conditions or obligations with respect to, or
otherwise challenge, impede, interfere or require material
amendment of the Acquisition or the acquisition of any shares or
other securities in, or control or management of, IQGeo by any
member of the Wider Bidco Group;
(vii) require,
prevent or materially delay a divestiture by any member of the
Wider Bidco Group of any shares or other securities (or the
equivalent) in any member of the Wider IQGeo Group or any member of
the Wider Bidco Group; or
(viii) impose any
material limitation on or result in any material delay in the
ability of any member of the Wider Bidco Group or any member of the
Wider IQGeo Group to conduct, integrate or co-ordinate all or any
part of its business with all or any part of the business of any
other member of the Wider Bidco Group and/or the Wider IQGeo
Group,
and all applicable waiting and other time
periods (including any extensions thereof) during which any such
Third Party could decide to take, institute, implement or threaten
any such action, proceeding, suit, investigation, enquiry or
reference or take any other step under the laws of any jurisdiction
in respect of the Acquisition or the acquisition of any IQGeo
Shares or otherwise intervene having expired, lapsed or been
terminated;
(f)
other than in respect of or in connection with the Conditions set
out in paragraphs 3(a) to
(d), all filings, applications and/or
notifications which are necessary or considered appropriate by
Bidco (acting reasonably) having been made in connection with the
Acquisition and all relevant waiting periods and other time periods
(including any extensions thereof) under any applicable legislation
or regulation of any jurisdiction having expired, lapsed or been
terminated (as appropriate) and all statutory or regulatory
obligations in any jurisdiction having been complied with in
connection with the Acquisition;
(g)
other than in respect of or in connection with the Conditions
set out in paragraphs 3(a) to
(d), all necessary Authorisations which are
deemed by Bidco to be necessary or reasonably considered to be
appropriate in any jurisdiction for or in respect of the
Acquisition or the proposed acquisition of any shares or other
securities in, or control of, IQGeo by any member of the Wider
Bidco Group having been obtained in terms and in a form reasonably
satisfactory to Bidco from all necessary Third Parties or persons
with whom any member of the Wider IQGeo Group has entered into
contractual arrangements, and all such Authorisations, together
with all Authorisations which are necessary or appropriate to carry
on the business of any member of the Wider IQGeo Group, remaining
in full force and effect and all filings necessary for such purpose
have been made and there being no notice or intimation of any
intention to revoke, suspend, restrict, modify or not to renew any
of the same at the time at which the Acquisition becomes otherwise
unconditional and all necessary statutory or regulatory obligations
in any jurisdiction having been complied with;
Certain
matters arising as a result of any arrangement, agreement,
etc.
(h)
except as Disclosed, there being no provision of any arrangement,
agreement, lease, licence, franchise, permit or other instrument to
which any member of the Wider IQGeo Group is a party or by or to
which any such member or any of its assets is or may be bound,
entitled or be subject or any event or circumstance which, as a
consequence of the Acquisition or the proposed acquisition by any
member of the Wider Bidco Group of any shares or other securities
(or the equivalent) in IQGeo or because of a change in the control
or management of any member of the Wider IQGeo Group or otherwise,
would reasonably be expected to result in, in each case to an
extent which is material in the context of the Wider Bidco Group or
the Wider IQGeo Group as a whole:
(i) any
monies borrowed by, or any other indebtedness or liabilities,
actual or contingent, of, or any grant available to, any member of
the Wider IQGeo Group being or becoming repayable, or capable of
being declared repayable, immediately or prior to its or their
stated maturity date or repayment date, or the ability of any such
member to borrow monies or incur any indebtedness being withdrawn
or inhibited or being capable of becoming or being withdrawn or
inhibited;
(ii)
the rights, liabilities, obligations, interests or business of any
member of the Wider IQGeo Group or any member of the Wider Bidco
Group under any such arrangement, agreement, licence, permit, lease
or instrument or the interests or business of any member of the
Wider IQGeo Group or any member of the Wider Bidco Group in or with
any other person or body or firm or company (or any agreement or
arrangement relating to any such interests or business) being or
becoming capable of being terminated, or adversely modified or
affected or any onerous obligation or liability arising or any
action being taken thereunder;
(iii) any
member of the Wider IQGeo Group ceasing to be able to carry on
business under any name under which it presently carries on
business, to an extent which is material in the context of the
Wider IQGeo Group taken as a whole;
(iv) any
assets or interests of any member of the Wider IQGeo Group being or
failing to be disposed of or charged or ceasing to be available to
any such member or any right arising under which any such asset or
interest could be required to be disposed of or charged or could
cease to be available to any member of the Wider IQGeo Group
otherwise than in the ordinary course of business;
(v)
the creation, save in the ordinary and usual course of business, or
enforcement of any mortgage, charge or other security interest over
the whole or any part of the business, property or assets of any
member of the Wider IQGeo Group or any such mortgage, charge or
other security interest (whenever created, arising or having
arisen), becoming enforceable;
(vi) the
business, assets, profits, value of, or the financial or trading
position or prospects of, any member of the Wider IQGeo Group being
prejudiced or adversely affected;
(vii) the
creation or acceleration of any liability (actual or contingent) by
any member of the Wider IQGeo Group, other than trade creditors or
other liabilities incurred in the ordinary course of business;
or
(viii) any liability of
any member of the Wider IQGeo Group to make any severance,
termination, bonus or other payment to any of its directors or
other officers other than in the ordinary course of
business;
and, no event having occurred which, under any
provision of any arrangement, agreement, licence, permit,
franchise, lease or other instrument to which any member of the
Wider IQGeo Group is a party or by or to which any such member or
any of its assets are bound, entitled or subject, would or would
reasonably be expected to result in any of the events or
circumstances as are referred to in Conditions 3(h)(i) to
3(h)(viii);
Certain events
occurring since 31 December 2023
(i) except as
Disclosed, no member of the Wider IQGeo Group having since 31
December 2023:
(i) save as
between IQGeo and its wholly-owned subsidiaries or between such
wholly-owned subsidiaries and save for the issue of IQGeo Shares on
the exercise of options under the IQGeo Share Plans, issued or
agreed to issue or authorised or proposed or announced its
intention to authorise or propose the issue, of additional shares
of any class, or securities or securities convertible into, or
exchangeable for, or rights, warrants or options to subscribe for
or acquire, any such shares, securities or convertible securities
or transferred or sold or agreed to transfer or sell or authorised
or proposed the transfer or sale of IQGeo Shares out of
treasury;
(ii)
recommended, declared, paid or made or proposed or agreed to
recommend, declare, pay or make any bonus issue, dividend or other
distribution (whether payable in cash or otherwise) other than
dividends (or other distributions whether payable in cash or
otherwise) lawfully paid or made by any wholly-owned subsidiary of
IQGeo to IQGeo or any of its wholly-owned subsidiaries;
(iii) other
than pursuant to the Acquisition (and except for transactions
between IQGeo and its wholly-owned subsidiaries or between the
wholly-owned subsidiaries of IQGeo and transactions in the ordinary
course of business) implemented, effected, authorised or proposed
or announced its intention to implement, effect, authorise or
propose any merger, demerger, reconstruction, amalgamation, scheme,
commitment or offer or disposal of assets or shares or loan capital
(or the equivalent thereof) in any undertaking or undertakings, in
each case to an extent which is material in the context of the
Wider IQGeo Group taken as a whole;
(iv) except
for transactions between IQGeo and its wholly-owned subsidiaries or
between the wholly-owned subsidiaries of IQGeo and except for
transactions in the ordinary course of business disposed of, or
transferred, mortgaged or created any security interest over any
material asset or any right, title or interest in any asset or
authorised, proposed or announced any intention to do so to an
extent which, in each case, is material in the context of the Wider
IQGeo Group taken as a whole;
(v)
except for transactions between IQGeo and its wholly-owned
subsidiaries or between the wholly-owned subsidiaries of IQGeo
issued, authorised, made or proposed or announced an intention to
issue, authorise or make any change in or to the terms of any
debentures or loan capital or become subject to any contingent
liability or incurred or increased any indebtedness to an extent
which, in each case, is material in the context of the Wider IQGeo
Group taken as a whole;
(vi)
entered into any licence or other disposal of intellectual property
rights of any member of the Wider IQGeo Group, which are material
in the context of the Wider IQGeo Group taken as a whole and
outside of the ordinary course of business;
(vii) entered
into or varied or authorised, proposed or announced its intention
to enter into or vary any contract, arrangement, agreement,
transaction or commitment (whether in respect of capital
expenditure or otherwise) (otherwise than in the ordinary course of
business) which is of a long term, unusual or onerous nature or
magnitude or which is or which involves or could reasonably be
expected to involve an obligation of a nature or magnitude which in
any such case, is material in the context of the IQGeo Group or in
the context of the Acquisition, or which is or is reasonably
expected to be materially restrictive on the business of any member
of the Wider IQGeo Group to an extent which, in each case, is
material in the context of the Wider IQGeo Group taken as a
whole;
(viii) entered into or
varied or authorised, proposed or announced its intention to enter
into or vary the terms of, or made any offer (which remains open
for acceptance) to enter into or vary the terms of any contract,
service agreement, commitment or arrangement with any director or
senior executive of any member of the Wider IQGeo Group, except for
salary increases, bonuses or variations of terms in the ordinary
course;
(ix)
proposed, agreed to provide or modified the terms of any share
option scheme, incentive scheme or other benefit relating to the
employment or termination of employment of any employee of the
Wider IQGeo Group, which, taken as a whole, are material in the
context of the Wider IQGeo Group taken as a whole;
(x)
purchased, redeemed or repaid or announced any proposal to
purchase, redeem or repay any of its own shares or other securities
or reduced or, except in respect of the matters mentioned in
sub-paragraph (i) above, made any other change to any part of its
share capital, to an extent which is material in the context of the
Wider IQGeo Group taken as a whole;
(xi) other
than with respect to claims between IQGeo and its wholly owned
subsidiaries (or between such subsidiaries), waived, compromised or
settled any claim otherwise than in the ordinary course of business
which is material in the context of the Wider IQGeo Group taken as
a whole;
(xii) terminated
or varied the terms of any agreement or arrangement between any
member of the Wider IQGeo Group and any other person in a manner
which would, or would reasonably be expected to, have a material
adverse effect on the financial position of the Wider IQGeo Group
taken as a whole;
(xiii) made any
alteration to its memorandum or articles of association or other
incorporation documents (in each case, other than in connection
with the Acquisition);
(xiv) in relation to
any pension scheme or other retirement, leaving service or death
benefit arrangement established for any directors or employees of
any entity in the Wider IQGeo Group or their dependants and
established by a member of the Wider IQGeo Group (a "Relevant Pension Plan"), except in
relation to changes made or agreed as a result of, or arising from,
changes to legislation, made or agreed or consented to any material
change to:
(A) the
terms of the trust deeds and rules constituting any Relevant
Pension Plan;
(B) the
contributions payable to any Relevant Pension Plan or to the
benefits which accrue, or to the pensions which are payable,
thereunder;
(C) the
basis on which qualification for, or accrual or entitlement to,
such benefits or pensions are calculated or determined;
or
(D) the
basis upon which the liabilities (including pensions) of any
Relevant Pension Plan are funded, valued, made, agreed or consented
to;
(xv) established
or proposed the establishment of any Relevant Pension Plan to the
extent which is material in the context of the Wider IQGeo Group
taken as a whole or in the context of the Acquisition, and other
than as required in accordance with applicable law;
(xvi) been unable, or
admitted in writing that it is unable, to pay its debts or
commenced negotiations with one or more of its creditors with a
view to rescheduling or restructuring any of its indebtedness, or
having stopped or suspended (or threatened to stop or suspend)
payment of its debts generally or ceased or threatened to cease
carrying on all or a substantial part of its business which is
material in the context of the Wider IQGeo Group taken as a
whole;
(xvii) (other than in respect
of a member of the Wider IQGeo Group which is dormant and was
solvent at the relevant time) taken or proposed any steps,
corporate action or had any legal proceedings instituted or
threatened against it in relation to the suspension of payments, a
moratorium of any indebtedness, its winding-up (voluntary or
otherwise), dissolution, reorganisation or for the appointment of a
receiver, administrator, manager, administrative receiver, trustee
or similar officer of all or any material part of its assets or
revenues or any analogous or equivalent steps or proceedings in any
jurisdiction or appointed any analogous person in any jurisdiction
or had any such person appointed which is material in the context
of the Wider IQGeo Group taken as a whole;
(xviii) other than pursuant to the
Acquisition, entered into or implemented any joint venture, asset
or profit sharing arrangement, partnership or merger of business or
corporate entities which is material in the context of the Wider
IQGeo Group taken as a whole;
(xix) taken (or agreed
or proposed to take) any action which requires, or would require,
the consent of the Panel or the approval of IQGeo Shareholders in
general meeting in accordance with, or as contemplated by, Rule
21.1 of the Takeover Code; or
(xx) entered into
any agreement, arrangement, commitment or contract or passed any
resolution or made any offer (which remains open for acceptance)
with respect to or announced an intention to, or to propose to,
effect any of the transactions, matters or events referred to in
this Condition 3(i);
No adverse
change, litigation, regulatory enquiry or similar
(j) except as
Disclosed, since 31 December 2023 there having been:
(i) no
adverse change and no circumstance having arisen which would be or
would reasonably be expected to result in any material adverse
change in, the business, assets, value, financial or trading
position or profits or prospects or operational performance of any
member of the Wider IQGeo Group which is material in the context of
the Wider IQGeo Group taken as a whole or is material in the
context of the Acquisition;
(ii)
no litigation, arbitration proceedings, prosecution or other legal
proceedings to which any member of the Wider IQGeo Group is or may
become a party (whether as claimant, defendant or otherwise) having
been threatened, announced, instituted or remaining outstanding by,
against or in respect of, any member of the Wider IQGeo Group, in
each case which is or would be expected to be material in the
context of the Wider IQGeo Group taken as a whole or is material in
the context of the Acquisition;
(iii) no
enquiry, review or investigation by, or complaint or reference to,
any Third Party against or in respect of any member of the Wider
IQGeo Group having been threatened, announced or instituted or
remaining outstanding by, against or in respect of any member of
the Wider IQGeo Group, in each case which would reasonably be
expected to have a material adverse effect on the Wider IQGeo Group
taken as a whole or is material in the context of the
Acquisition;
(iv) no
contingent or other liability having arisen or become apparent to
Bidco or increased other than in the ordinary course of business
which is reasonably likely to affect adversely the business,
assets, financial or trading position or profits or prospects of
any member of the Wider IQGeo Group to an extent which is material
in the context of the Wider IQGeo Group taken as a whole or is
material in the context of the Acquisition;
(v)
no steps having been taken and no omissions having been made which
are reasonably likely to result in the withdrawal, cancellation,
termination or modification of any licence held by any member of
the Wider IQGeo Group which is necessary for the proper carrying on
of its business and the withdrawal, cancellation, termination or
modification of which would reasonably be expected to have a
material adverse effect on the Wider IQGeo Group taken as a whole
or is material in the context of the Acquisition; and
(vi) no
member of the Wider IQGeo Group having conducted its business in
breach of any applicable laws and regulations in manner which is
material in the context of the Wider IQGeo Group taken as a
whole;
No discovery
of certain matters regarding information, liabilities and
environmental issues
(k)
except as Disclosed, Bidco not having discovered that:
(i) any
financial, business or other information concerning the Wider IQGeo
Group publicly announced before the date of the Announcement or
disclosed at any time to any member of the Wider Bidco Group by or
on behalf of any member of the Wider IQGeo Group before the date of
this Announcement is misleading, contains a misrepresentation of
any fact, or omits to state a fact necessary to make that
information not misleading, and which is, in any case, material in
the context of the Wider IQGeo Group taken as a whole or in the
context of the Acquisition;
(ii)
any member of the Wider IQGeo Group is subject to any liability,
contingent or otherwise, which is material in the context of the
Wider IQGeo Group taken as a whole;
(iii) any
past member whilst it was a member of the Wider IQGeo Group or
present member of the Wider IQGeo Group has not complied with any
applicable legislation, regulations or other requirements of any
jurisdiction or any Authorisations relating to the use, treatment,
storage, carriage, disposal, discharge, spillage, release, leak or
emission of any waste or hazardous substance or any substance
likely to impair the environment (including property) or harm human
or animal health or otherwise relating to environmental matters or
the health and safety of humans, which non-compliance would be
likely to give rise to any material liability including any penalty
for non-compliance (whether actual or contingent) on the part of
any member of the Wider IQGeo Group, in each case to an extent
which is material in the context of the Wider IQGeo Group taken as
a whole;
(iv) there
is or is reasonably likely to be any obligation or liability
(whether actual or contingent) or requirement to make good,
remediate, repair, reinstate or clean up any property, asset or any
controlled waters currently or previously owned, occupied, operated
or made use of or controlled by any past member whilst it was a
member of the Wider IQGeo Group or present member of the Wider
IQGeo Group (or on its behalf), or in which any such member may
have or previously have had or be deemed to have had an interest,
under any environmental legislation, common law, regulation,
notice, circular, Authorisation or order of any Third Party in any
jurisdiction or to contribute to the cost thereof or associated
therewith or indemnify any person in relation thereto, in any such
case which is material in the context of the Wider IQGeo Group
taken as a whole; or
(v)
circumstances exist (whether as a result of making the Acquisition
or otherwise):
(A) which
would be reasonably likely to lead to any Third Party instituting;
or
(B) whereby
any member of the Wider IQGeo Group would be likely to be required
to institute,
an environmental audit or take any steps which
would in any such case be reasonably likely to result in any actual
or contingent liability to improve or install new plant or
equipment or to make good, repair, reinstate or clean up any
property of any description or any asset now or previously owned,
occupied or made use of by any past member whilst it was a member
of the Wider IQGeo Group or present member of the Wider IQGeo Group
(or on its behalf) or by any person for which a member of the Wider
IQGeo Group is or has been responsible, or in which any such member
may have or previously have had or be deemed to have had an
interest, which is material in the context of the Wider IQGeo Group
taken as a whole;
Intellectual
property
(l) except as
Disclosed and since 31 December 2023, no circumstance having arisen
or event having occurred in relation to any intellectual property
owned or used by any member of the Wider IQGeo Group which would
have a material adverse effect on the Wider IQGeo Group taken as a
whole, including:
(i) any
member of the Wider IQGeo Group losing its title to any
intellectual property used in its business, or any intellectual
property owned by any member of the Wider IQGeo Group and material
to its business being revoked, cancelled or declared
invalid;
(ii)
any claim being asserted in writing or threatened in writing by any
person challenging the ownership of any member of the Wider IQGeo
Group to, or the validity or effectiveness of, any of its
intellectual property; or
(iii) any
agreement regarding the use of any intellectual property licensed
to or by any member of the Wider IQGeo Group being terminated or
varied; and
Anti-corruption, sanctions and criminal
property
(m) except
as Disclosed, Bidco not having discovered:
(i) (i) any
past member whilst it was a member of the Wider IQGeo Group or
present member, director, officer or employee of the Wider IQGeo
Group is or has at any time engaged in any activity, practice or
conduct (or omitted to take any action) which would constitute an
offence under the Bribery Act 2010, the US Foreign Corrupt
Practices Act of 1977, as amended, or any other anti-corruption
legislation applicable to the Wider IQGeo Group; or (ii) any past
member whilst it was a member of the Wider IQGeo Group or present
member of the Wider IQGeo Group or any person that performs or has
performed services for or on behalf of the Wider IQGeo Group is or
has at any time engaged in any activity, practice or conduct in
connection with the performance of such services which would
constitute an offence under the Bribery Act 2010, the US Foreign
Corrupt Practices Act of 1977, as amended, or any other applicable
anti-corruption legislation;
(ii)
any asset of any member of the Wider IQGeo Group constitutes
criminal property as defined by section 340(3) of the Proceeds of
Crime Act 2002 (but disregarding paragraph (b) of that
definition);
(iii) any
past member whilst it was a member of the Wider IQGeo Group or
present member, director, officer or employee of the Wider IQGeo
Group, has engaged in any business with, made any investments in,
made any funds or assets available to or received any funds or
assets from: (i) any government, entity or individual in respect of
which US, UK or European Union persons, or persons operating in
those territories, are prohibited from engaging in activities or
doing business, or from receiving or making available funds or
economic resources, by applicable US, UK or European Union laws or
regulations, including the economic sanctions administered by the
United States Office of Foreign Assets Control or HM Treasury &
Customs; or (ii) any government, entity or individual targeted by
any of the economic sanctions of the United Nations, the United
States, the United Kingdom, the European Union or any of its member
states or any other governmental or supranational body or authority
in any jurisdiction, except as may have been licensed by the
relevant authority; or
(iv) a
member of the Wider IQGeo Group has engaged in any transaction or
conduct which would cause any member of the Wider IQGeo Group or
the Wider Bidco Group to be in breach of any applicable law or
regulation upon the completion of the Acquisition, including any
economic sanctions of the United States Office of Foreign Assets
Control or HM Treasury & Customs, or any government, entity or
individual targeted by any of the economic sanctions of the United
Nations, the United States, the United Kingdom or the European
Union or any of its member states.
Part B:
FURTHER TERMS OF THE ACQUISITION
1. The
Conditions set out in paragraphs 2(a), 2(b) and 3(a) to (m)
(inclusive) of Part A above must each be fulfilled, determined by
Bidco to be or to remain satisfied or (if capable of waiver) be
waived by Bidco prior to the commencement of the Court hearing to
sanction the Scheme, failing which the Scheme will
lapse.
2.
Notwithstanding the paragraph above, subject to the requirements of
the Panel and the Takeover Code, Bidco reserves the right in its
sole discretion to waive:
(a)
the deadlines set out in paragraph 1 of Part A above, and any of
the deadlines set out in paragraph 2 of Part A above for the timing
of the Court Meeting, the General Meeting and/or the Court hearing
to sanction the Scheme. If any such deadline is not met, Bidco will
make an announcement by 8.00 am on the Business Day following such
deadline confirming whether it has invoked or waived the relevant
Condition or agreed with IQGeo to extend the deadline in relation
to the relevant Condition. For the avoidance of doubt, the
Conditions set out in paragraphs 2(a)(i), 2(b)(i) and 2(c)(i) of
Part A above cannot be waived; and
(b)
in whole or in part, all or any of the above Conditions set out in
paragraphs 3(a) to (m) (inclusive) of Part A above.
3. Bidco
shall be under no obligation to waive or treat as satisfied any of
the Conditions that it is entitled (with the consent of the Panel
and subject to the requirements of the Takeover Code) to waive, by
a date earlier than the latest date specified above for the
fulfilment or waiver thereof, notwithstanding that the other
Conditions may at such earlier date have been waived or fulfilled
and that there are at such earlier date no circumstances indicating
that any of such Conditions may not be capable of
fulfilment.
4. If Bidco
is required by the Panel to make an offer for IQGeo Shares under
the provisions of Rule 9 of the Takeover Code, Bidco may make such
alterations to any of the above Conditions and terms of the
Acquisition as are necessary to comply with the provisions of Rule
9.
5. Under Rule
13.5(a) of the Takeover Code, Bidco may only invoke a Condition
that is subject to Rule 13.5(a) of the Takeover Code so as to cause
the Acquisition not to proceed, to lapse or to be withdrawn with
the consent of the Panel and any Condition that is subject to Rule
13.5(a) of the Takeover Code may be waived by Bidco. The Panel will
normally only give its consent if the circumstances which give rise
to the right to invoke the Condition are of material significance
to Bidco in the context of the Acquisition. This will be judged by
reference to the facts of each case at the time that the relevant
circumstances arise.
6. Conditions
1, 2(a), 2(b) and 2(c) of Part A above and, if applicable, any
acceptance condition if the Acquisition is implemented by means of
a Takeover Offer, are not subject to Rule 13.5(a) of the Takeover
Code.
7. The IQGeo
Shares to be acquired under the Acquisition will be acquired with
full title guarantee, fully paid and free from all liens, equities,
charges, encumbrances, options, rights of pre-emption and any other
third party rights and interests of any nature and together with
all rights now or hereafter attaching or accruing to them,
including, without limitation, voting rights and the right to
receive and retain in full all dividends and other distributions
and any return of capital (whether by reduction of share capital or
share premium account or otherwise) declared, made, paid or
becoming payable by reference to a record date falling on or after
the Effective Date (other than any dividend, distribution or return
of capital in respect of which a corresponding reduction in the
consideration payable under the terms of the Acquisition has been
made as described in paragraph 8 below).
8. Subject to
the terms of the Acquisition, if, on or after the date of this
Announcement and on or prior to the Effective Date, any dividend
and/or other distribution and/or return of capital is authorised,
declared, made or paid or becomes payable in respect of IQGeo
Shares, Bidco reserves the right to reduce the cash consideration
payable under the Cash Offer (and, as the case may be, the
consideration payable under the Alternative Offer) under the terms
of the Acquisition by an amount equal to all or part of any such
dividend and/or other distribution and/or return of capital, in
which case: (a) any reference in this Announcement or in the Scheme
Document to the Cash Offer or the Alternative Offer for the IQGeo
Shares will be deemed to be a reference to, respectively, the Cash
Offer or the Alternative Offer as so reduced; and (b) the relevant
Eligible IQGeo Shareholders will be entitled to receive and retain
any such dividend and/or other distribution and/or return of
capital authorised, declared, made or paid. To the extent that any
such dividend, distribution or return of capital is authorised,
declared, made or paid or becomes payable: (x) pursuant to the
Acquisition on a basis which entitles Bidco to receive the dividend
or distribution or return of capital and to retain it; or (y) is
subsequently cancelled, the Cash Offer and the Alternative Offer
will not be subject to change in accordance with this paragraph.
Any exercise by Bidco of its rights referred to in this paragraph
shall be the subject of an announcement and, for the avoidance of
doubt, shall not be regarded as constituting any revision or
variation of the Acquisition.
9. Bidco
reserves the right to elect (with the consent of the Panel (where
necessary) and subject to the terms of the Co-operation Agreement)
to implement the Acquisition by way of a Takeover Offer as an
alternative to the Scheme. In such event, the offer will be
implemented on substantially the same terms subject to appropriate
amendments, including, without limitation, an acceptance condition
set at not more than 75 per cent. of the IQGeo Shares (unless with
the consent of IQGeo or required by the Panel) where the election
to proceed by way of a Takeover Offer is an agreed switch under the
terms of the Co-operation Agreement and otherwise set at 90 per
cent. of the IQGeo Shares to which the Takeover Offer relates (or
such lesser percentage as Bidco may decide after, to the extent
necessary, consultation with the Panel, being in any case more than
50 per cent. of the IQGeo Shares), so far as applicable, as those
which would apply to the Scheme. Further, if sufficient acceptances
of such Takeover Offer are received and/or sufficient IQGeo Shares
are otherwise acquired, it is the intention of Bidco to apply the
provisions of the Companies Act to acquire compulsorily any
outstanding IQGeo Shares to which such Takeover Offer
relates.
10. The
availability of the Acquisition (including the Alternative Offer)
to persons not resident in the United Kingdom may be affected by
the laws of the relevant jurisdictions. Persons who are not
resident in the United Kingdom should inform themselves about and
observe any applicable legal and regulatory
requirements.
11. The
Acquisition (including the Alternative Offer) is not being made,
directly or indirectly, in, into or from, or by use of the mails
of, or by any means of instrumentality (including, but not limited
to, facsimile, e-mail or other electronic transmission, telex or
telephone) of interstate or foreign commerce of, or of any facility
of a national, state or other securities exchange of, any
Restricted Jurisdiction.
12. The
Scheme will be governed by English law and is subject to the
jurisdiction of the Court and to the Conditions and further terms
set out in this Appendix 1 to this Announcement, and to the full
terms and Conditions to be set out in the Scheme Document. The
Acquisition will be subject to the applicable requirements of the
Takeover Code, the Panel, the London Stock Exchange (including the
AIM Rules) and the FCA.
13. Each of
the Conditions will be regarded as a separate Condition and will
not be limited by reference to any other Condition.
Appendix 2
SOURCES AND BASES OF INFORMATION
Unless otherwise stated
in this Announcement:
1. all
references to IQGeo Shares are to IQGeo ordinary shares of 2 pence
each;
2. the value
of £333 million attributed to the fully diluted issued share
capital of IQGeo has been calculated based on 480 pence per IQGeo
Share and:
(a)
61,723,156 IQGeo Shares in issue; and
(b) a
maximum of 7,590,964 IQGeo Shares to be issued on the exercise of
options under the IQGeo Share Plans,
in each case as at the Latest Practicable
Date;
3. the
enterprise value of IQGeo of £316 million implied by the Cash Offer
has been calculated by using the value attributed to the fully
diluted issued share capital of IQGeo calculated in accordance with
paragraph 2 above plus the amount of net debt calculated as
follows:
(a)
lease liabilities of £2.0 million as at 31 December 2023;
plus
(b)
contingent consideration for the acquisition of Comsof of £1.3
million as at 31 December 2023; plus
(c)
non-cash provision relating to potential tax warranty claim related
to the sale of the RTLS business of £1.0 million as at 31 December
2023; plus
(d) phantom
cash awards of £0.2 million granted during FY2023; less
(e)
cash and cash equivalents of £11.0 million as at 31 December 2023;
less
(f)
cash inflow from the exercise of options under the IQGeo Share
Plans of £9.8 million during FY2023;
4. the volume
weighted average prices per IQGeo Share have been sourced from
Bloomberg;
5. the
Closing Prices per IQGeo Share have been sourced from
Bloomberg;
6. IQGeo's
all-time share price high of 466 pence was achieved on 29 March
2024, as sourced from Bloomberg; and
7. unless
otherwise stated, the financial information relating to IQGeo is
extracted from the annual report and accounts of IQGeo for the
relevant years, and the audited consolidated financial statements
contained therein have been prepared in compliance with United
Kingdom accounting standards, including Financial Reporting
Standard 102 (FRS 102) and the Companies Act 2006.
Appendix 3
DETAILS OF IRREVOCABLE UNDERTAKINGS and letters of
intent
1.
IQGeo Directors
The following IQGeo Directors have given
irrevocable undertakings in respect of the following IQGeo Shares
beneficially held by them (or their family) to vote (or procure the
voting) in favour of the Scheme at the Court Meeting and the IQGeo
Resolution(s) at the General Meeting (or, if the Acquisition is
implemented by means of a Takeover Offer, to accept or procure the
acceptance of the Takeover Offer):
Name
|
Number of IQGeo Shares
|
Percentage of IQGeo existing issued
ordinary share capital
|
Paul Taylor
|
263,562
|
0.43
|
Riccardo Petti
|
235,442
|
0.38
|
Haywood Chapman
|
96,228
|
0.16
|
Robert Sansom
|
3,355,729
|
5.44
|
Ian Kershaw*
|
97,117
|
0.16
|
Andrew MacLeod
|
104,103
|
0.17
|
Carolyn Rand
|
10,000
|
0.02
|
These irrevocable undertakings remain binding
in the event a higher competing offer is made for IQGeo by a third
party and will only cease to be binding on the earlier of the
following occurrences:
·
if Bidco announces its election to implement the Acquisition
by way of a Takeover Offer, and the formal document containing the
Takeover Offer is not published within 28 days (or such longer
period as the Panel may agree) after the date of the announcement
of such election unless, on or before that date (as extended, if
applicable), Bidco announces its election to implement the
Acquisition by way of a Scheme or otherwise;
·
the Scheme or Takeover Offer lapses or is withdrawn in
accordance with its terms and Bidco publicly confirms that it does
not intend to proceed with the Acquisition or to implement the
Acquisition by way of a Takeover Offer or otherwise;
·
Bidco announces, with the consent of the Panel, that it does
not intend to make or proceed with the Acquisition and no new,
revised or replacement offer or scheme is announced in accordance
with Rule 2.7 of the Takeover Code at the same time;
·
the date on which any competing offer for the entire issued
and to be issued share capital of IQGeo is declared wholly
unconditional (if implemented by way of a Takeover Offer) or, if
proceeding by way of a scheme of arrangement, becomes effective;
or
·
the Scheme has not become effective by the Long Stop
Date.
*In respect of the interest of the
IQGeo Directors in the Company, it is noted that Ian Kershaw has a
beneficial interest in 97,117 IQGeo Shares, representing 0.16 per
cent. of the total issued share capital of the Company as at the
date of this Announcement.
2.
Other IQGeo
Shareholders
The following Shareholders have given
irrevocable undertakings in respect of those IQGeo Shares owned or
controlled by them to vote (or procure the voting) (i) in favour of
the Scheme at the Court Meeting and the IQGeo Resolution(s) at the
General Meeting (or, if the Acquisition is implemented by means of
a Takeover Offer, to accept or procure the acceptance of the
Takeover Offer) and (ii) in the case of Kestrel Partners, against
any competing proposal:
Name
|
Number of IQGeo Shares
|
Percentage of IQGeo existing issued
ordinary share capital
|
Kestrel
Partners
|
16,294,119
|
26.40
|
Herald Investment
Management Limited
|
2,680,585
|
4.34
|
Raf
Meersman
|
777,657
|
1.26
|
Richard Terence
Green
|
775,000
|
1.26
|
The irrevocable undertaking given by Kestrel
Partners remains binding in the event a higher competing offer is
made for IQGeo by a third party and will only cease to be binding
on the earlier of the following occurrences:
·
if Bidco announces its valid and binding election to
implement the Acquisition by way of a Takeover Offer and either
Bidco does not announce the Takeover Offer in accordance with Rule
2.7 of the Takeover Code within ten business days of such election
announcement or the formal document containing the Takeover Offer
is not published within 60 days thereafter; or
·
the Scheme lapses or is withdrawn in accordance with its
terms (or having announced its election to implement the
Acquisition by way of a Takeover Offer, that Takeover Offer is
subsequently withdrawn or lapses in accordance with its terms) and
Bidco publicly confirms that it does not intend to proceed with the
Acquisition or to implement the Acquisition (by way of a Takeover
Offer or otherwise); or
·
the Scheme has not become effective by the Long Stop
Date.
The irrevocable undertakings given by Herald
Investment Management Limited and Mr Richard Terence Green will
cease to be binding on the earlier of the following
occurrences:
·
if Bidco announces its valid and binding election to
implement the Acquisition by way of a Takeover Offer and either
Bidco does not announce the Takeover Offer in accordance with Rule
2.7 of the Takeover Code within ten business days of such election
announcement or the formal document containing the Takeover Offer
is not published within 60 days thereafter; or
·
the Scheme lapses or is withdrawn in accordance with its
terms (or having announced its election to implement the
Acquisition by way of a Takeover Offer, that Takeover Offer is
subsequently withdrawn or lapses in accordance with its terms) and
Bidco publicly confirms that it does not intend to proceed with the
Acquisition (or to implement the Acquisition by way of a Takeover
Offer or otherwise); or
·
the Scheme has not become effective by the Long Stop Date;
or
·
Bidco announces, with the consent of the Panel, that it does
not intend to make or proceed with the Acquisition and no new,
revised or replacement offer or scheme is announced in accordance
with Rule 2.7 of the Takeover Code at the same time; or
·
a third party announces through a Regulatory Information
Service, prior to the date of the Court Meeting and/or the General
Meeting, a firm intention to make a general offer in accordance
with the Takeover Code (whether or not subject to any
pre-conditions) to acquire (howsoever to be implemented) the entire
issued and to be issued share capital of IQGeo.
The irrevocable undertaking given by Mr Raf
Meersman remains binding in the event a higher competing offer is
made for IQGeo by a third party and will only cease to be binding
on the earlier of the following occurrences:
·
if Bidco announces its election to implement the Acquisition
by way of a Takeover Offer, and the formal document containing the
Takeover Offer is not published within 28 days (or such longer
period as the Panel may agree) after the date of the announcement
of such election unless, on or before that date (as extended, if
applicable), Bidco announces its election to implement the
Acquisition by way of a Scheme or otherwise; or
·
the Scheme lapses or is withdrawn in accordance with its
terms and Bidco publicly confirms that it does not intend to
proceed with the Acquisition (or to implement the Acquisition by
way of a Takeover Offer or otherwise); or
·
Bidco announces, with the consent of the Panel, that it does
not intend to make or proceed with the Acquisition and no new,
revised or replacement offer or scheme is announced in accordance
with Rule 2.7 of the Takeover Code at the same time;
·
any competing offer for the entire issued and to be issued
share capital of IQGeo is declared wholly unconditional (if
implemented by way of a takeover offer) or, if proceeding by way of
a scheme of arrangement, becomes effective; or
·
the Scheme has not become effective by the Long Stop
Date.
Bidco has received non‑binding letters of
intent from the following IQGeo Shareholders in respect of those
IQGeo Shares owned or controlled by them to vote (or procure the
voting) in favour of the Scheme at the Court Meeting and the IQGeo
Resolution(s) at the General Meeting (or, in the case of Charles
Stanley & Co Ltd only, if the Acquisition is implemented by
means of a Takeover Offer, to accept or procure the acceptance of
the Takeover Offer):
Name
|
Number of IQGeo Shares
|
Percentage of IQGeo existing issued
ordinary share capital
|
Charles Stanley &
Co Ltd
|
6,100,000
|
9.88
|
Canaccord Genuity
Asset Management, for and on behalf of IFSL Marlborough UK
Micro-Cap Growth Fund and IFSL Marlborough Nano-Cap Growth
Fund
|
5,150,000
|
8.34
|
Appendix 4
DETAILS ON TOPCO AND Topco Investor Shares
1.
Information on
Topco
Topco will be incorporated under the laws of
England and Wales prior to the publication of the Scheme Document.
Topco will initially be incorporated with one (or minimal) ordinary
share(s) directly or indirectly wholly owned by KKR Investor. Bidco
will become a direct or indirect wholly-owned subsidiary company of
Topco (once incorporated).
Set out below is a summary of the proposed
Topco share capital structure and the intended principal provisions
of the Topco Shareholders' Agreement and the Topco Articles
governing the terms on which all Topco shareholders, including KKR
Investor and Investor Shareholders, will hold securities in Topco,
further details on which will be included in the Scheme Document.
The Topco Shareholders' Agreement and the Topco Articles will be
finalised and made publicly available when the Scheme Document is
published. IQGeo Shareholders who wish to elect for the Alternative
Offer are encouraged to read the Topco Shareholders' Agreement, the
Topco Articles and the Scheme Document, when published.
2.
Information on Topco share
capital
On or around the Effective Date, Topco will,
subject to the terms and conditions of the Alternative Offer, issue
(i) Topco Investor Shares to those IQGeo Shareholders
who have validly elected to receive the Alternative Offer and (ii)
Topco Sponsor Shares and Topco Redeemable Shares to KKR Investor
(such Topco Investor Shares, Topco Sponsor Shares and Topco
Redeemable Shares, together with any Topco Shares already issued to
KKR Investor prior to the Effective Date, the "Topco Offer Shares"). The Topco Sponsor
Shares and Topco Redeemable Shares to be issued on or around the
Effective Date will be issued at an equivalent value to that of the
Topco Investor Shares.
The Topco Sponsor Shares and the Topco Investor
Shares will comprise 61 per cent. and up to 30 per cent.
respectively of the Topco Offer Shares, with the balance comprised
of Topco Redeemable Shares, provided always that the number of
Topco Redeemable Shares in issue will not exceed the Topco
Redeemable Share Maximum. Any Topco Redeemable Shares which would
cause the total number of Topco Redeemable Shares in issue to
exceed the Topco Redeemable Share Maximum will instead be issued as
Topco Sponsor Shares.
On that basis, and for illustrative purposes
only, in the event the Alternative Offer is taken up in full by
Eligible IQGeo Shareholders, based on Bidco's current estimate
of fees, costs and expenses payable in respect of the
Acquisition and assuming the number of IQGeo Shares issued pursuant
to the IQGeo Share Plans prior to the Effective Date is the maximum
number set out in paragraph 2(b) of Appendix 2
to this Announcement, Topco would, on or around the Effective
Date and subject to the terms and conditions of the Alternative
Offer, have in issue around (inclusive of any Topco
Shares already issued to KKR Investor prior to the Effective
Date):
·
4,534,271 Topco Sponsor Shares and 668,990 Topco Redeemable
Shares issued to KKR Investor to fund the cash consideration
payable under the Acquisition and fees, costs and expenses payable
in respect of the Acquisition; and
·
2,229,969 Topco Investor Shares issued to those IQGeo
Shareholders who validly elect to receive the Alternative
Offer.
If, however, the Alternative Offer were
accepted in respect of less than the Alternative Offer Maximum, the
number of Topco Investor Shares would be reduced accordingly, and
the balance of the Topco Offer Shares will instead be issued in the
form of (i) additional Topco Redeemable Shares up to the Topco
Redeemable Share Maximum; and (ii) additional Topco Sponsor Shares
(for the balance).
3.
Topco Redeemable Shares and
re-financing
The Topco Redeemable Shares will accrue
interest from issuance at a floating rate of SONIA plus 2.05 per
cent. per year (the "Yield") and will rank senior to the
Topco Ordinary Shares for any dividend or other distribution
(including on a winding up). They will be redeemable by Topco at a
redemption price equal to the sum of (i) the Topco Redeemable Share
Subscription Amount and (ii) the accrued Yield. The Topco
Redeemable Shares will carry voting rights.
It is intended that, within 90 days following
the Effective Date, Topco will re-finance the Topco Redeemable
Shares. This refinancing is currently expected to be effected by
way of an issue of additional Topco Ordinary Shares but could be
effected through the issue of a different instrument.
If the re-financing is effected by means of the
issue of additional Topco Ordinary Shares, the number of Topco
Ordinary Shares to be issued will be equal to the number of Topco
Redeemable Shares in issue at the date of the re-financing, at a
subscription price per Topco Ordinary Share equal to the sum of (i)
the Topco Redeemable Share Subscription Amount; and (ii) the Yield
accrued on each Topco Redeemable Share at the time of the
re-financing.
All Topco Ordinary Shareholders will be
entitled to participate on a pro
rata pre-emptive basis in proportion to their holdings of
Topco Ordinary Shares (with an ability to subscribe for any excess
amount not taken up by other Topco Ordinary Shareholders). KKR
Investor would expect to participate in any such pre-emptive issue
for at least its pro rata
entitlement. The proceeds from any such issue would be applied by
Topco to redeem the Topco Redeemable Shares.
If any of the Topco Redeemable Shares are not
redeemed at the end of the period of 90 days following the
Effective Date, KKR Investor shall be entitled, within 30 days
thereafter, to exchange all Topco Redeemable Shares in issue at
that time for an equal number of Topco Ordinary Shares. Such
exchange of Topco Redeemable Shares for Topco Ordinary Shares will
not be subject to pre-emption rights in favour of the other Topco
Ordinary Shareholders.
4.
Listing
The Topco Investor Shares will not be listed or
traded on any stock exchange.
5.
Economic rights
Both the Topco Sponsor Shares and the Topco
Investor Shares are Topco Ordinary Shares. The Topco Investor
Shares will rank pari
passu in all respects with the Topco Sponsor Shares,
including the rights to vote at general meetings and to receive and
retain dividends and other distributions declared, made or paid by
reference to a record date falling on or after the date of issue of
such Topco Investor Shares. The Topco Investor Shares will be
issued credited as fully paid.
The economic rights attaching to the Topco
Investor Shares are subject to the risks described below and in
paragraph 13 of this Announcement.
6.
Board
composition
The number of directors on the Topco Board will
be not less than three and the maximum number of directors on the
Topco Board will be determined by KKR Investor.
KKR Investor will be entitled to appoint or
remove the majority of the directors to or from the Topco Board
and, upon removal, to appoint other people in their places.
Qualified Investor Shareholders will have a consultation right in
respect of the replacement of any person holding a senior
management position in the Topco Group.
Any Investor Shareholder (i) holding on the
date on which the Topco Offer Shares are issued, and continuing to
hold thereafter, Topco Ordinary Shares representing at least 20 per
cent. of Topco's total voting rights as of the date on which the
Topco Offer Shares are issued or (ii) holding Topco Ordinary Shares
representing at least 20 per cent. of Topco's total voting rights
from time to time (such Investor Shareholder, a "Qualified Investor Shareholder"), will
be entitled to appoint one director and one observer to the Topco
Board.
Topco directors will be given no less than ten
business days' notice for each meeting of the board (which may be
waived with the agreement of one director appointed by KKR Investor
and each director appointed by a Qualified Investor Shareholder),
together with an agenda for the business of the meeting and all
papers in connection with it. The quorum for the transaction of
business at a board meeting will be two directors (including one
director appointed by KKR Investor), provided that the quorum must
include each director appointed by a Qualified Investor Shareholder
if a Reserved Matter is to be considered and voted on at the
meeting. There shall be a minimum of four meetings of the Topco
Board per annum.
Any director fees payable to the directors
appointed by the Qualified Investor Shareholders shall be
equivalent to the director fees payable to the directors appointed
by KKR Investor.
7.
Board voting and
quorum
Each director on the Topco Board will have one
vote and resolutions of the Topco Board will be passed by a simple
majority and must include the vote of at least one director
appointed by KKR Investor, provided that any resolution approving a
Reserved Matter must be approved by KKR Investor and each director
appointed by a Qualified Investor Shareholder.
Further provisions in respect of decision
making and quorum of the Topco Board are to be determined and will
be set out in the Topco Shareholders' Agreement, the Topco Articles
and summarised in the Scheme Document.
8.
Topco governance
On a written shareholder resolution or on a
poll at a general meeting of Topco, each holder will have one vote
for each Topco Share held.
The following matters (the "Reserved Matters") will require the
prior consent of each Qualified Investor Shareholder:
(a)
any material amendment to the organisational documents of Topco, in
a manner that would adversely and disproportionately affect a
Qualified Investor Shareholder compared to KKR Investor;
(b)
the voluntary liquidation or winding-up of Topco;
(c)
any transactions between Topco (or its subsidiaries, including
IQGeo), on the one hand, and any Topco shareholder (or any of its
related parties) on the other hand, other than on arm's length
terms;
(d) any
raising of new equity capital or issue of any securities by any
member of the Topco Group otherwise than in accordance with
pre-emption rights;
(e)
any return of capital, redemption or buy-back of shareholder
instruments or recapitalisation of or by any member of the Topco
Group other than on a pro
rata basis as between the Topco Ordinary
Shareholders;
(f)
any dividends or distributions declared, paid or made to Topco
shareholders other than on a pro
rata basis as between the Topco Ordinary
Shareholders;
(g)
the commencement or settlement of any material
litigation;
(h)
the making of any material amendment to the nature of the business
of IQGeo or the Topco Group; and
(i) the
incurrence of material indebtedness in excess of the greater of 2x
the annual recurring revenue or 5x the earnings before interest,
tax, depreciation and amortisation of the Topco Group,
save, in the case of paragraphs
(d) and (e) above,
between wholly-owned members of the Topco Group, provided such
action does not disproportionately affect the Investor
Shareholders.
The following matters ("Consultation Matters") will require
prior consultation with any Qualified Investor
Shareholder:
(a)
the replacement of any member of senior management of the Topco
Group;
(b)
any merger, acquisition or disposal involving a member of the Topco
Group at a value that is material in the context of the business of
the Topco Group taken as a whole;
(c)
the establishment of any management incentive plan; and
(d) any
sale of interests in Topco that constitutes a change of control or
sale of all or substantially all of the assets of Topco.
9.
Information
rights
KKR Investor and each Qualified Investor
Shareholder will be entitled to customary information rights in
relation to Topco and the Topco Group, including the right to
receive:
(a)
the annual audited consolidated accounts of the Topco
Group;
(b)
monthly management accounts for the Topco Group, to the extent
available; and
(c)
copies of all financial or other information provided by the Topco
Group to any lender or investor in the Topco Group's debt or debt
securities.
10.
Pre-emption
If Topco proposes to issue new equity
securities in Topco (or any instrument to be converted into equity
in Topco) to KKR Investor, each other holder of Topco Shares shall
be entitled to participate in the issue pro rata to the proportion of Topco
Shares represented by the number of Topco Shares it holds,
excluding the following issues:
(a)
to KKR Investor in exchange for the Topco Redeemable Shares as
described above in paragraph 3 of
this Appendix 4;
(b)
to KKR Investor to finance the Acquisition or any purchase of IQGeo
Shares outside the Acquisition (pursuant to the compulsory
acquisition procedure or otherwise);
(c)
to Investor Shareholders pursuant to the terms of or in connection
with the implementation of the Acquisition;
(d)
pursuant to a management incentive plan;
(e)
for non-cash consideration on the acquisition of, or merger with,
all or part of another business, undertaking, company or assets
that has been approved by the Topco board; and
(f)
in connection with debt financing arrangements of Topco approved by
the Topco board where the financing is conditional on Topco issuing
equity securities (or any instrument to be converted into equity in
Topco) to such debt finance provider.
In the event of an issuance described in
paragraphs (d) to
(f), the percentage shareholding of all Topco
Ordinary Shareholders will be diluted on a pro rata basis.
11.
Transfers
Restrictions on
transfer
The Topco Investor Shares can only be
transferred (i) with the prior written consent of KKR Investor or
(ii) pursuant to the drag and tag rights described
below.
Right of first offer
Other than with respect to (i) a transfer
pursuant to the drag and tag rights described below in the case of
a proposed transfer of Topco Shares or (ii) any transfer of Topco
Shares by KKR Investor to an affiliate of KKR Investor, if any
holder of Topco Shares intends to sell any of its Topco Shares (in
each case, the "Selling
Shareholder"), then such Selling Shareholder must first
offer such Topco Shares to KKR Investor and each (other) Qualified
Investor Shareholder as applicable (the "Non-Selling Shareholders"). The
Non-Selling Shareholders will be entitled to make a binding offer
pro rata to their
respective proportionate holding of Topco Shares to the Selling
Shareholder within 30 calendar days.
The Selling Shareholder will be permitted to
accept or reject any offer from any Non-Selling Shareholder within
30 calendar days of receipt of the offer. If the Selling
Shareholder rejects an offer from a Non-Selling Shareholder, it
cannot, within the next 180 calendar days, accept an offer from a
third party at a price per share that is less than the price
offered by such Non-Selling Shareholder. Once that 180 calendar day
period has expired, if the Selling Shareholder intends to sell any
of its Topco Shares, it must re-approach the Non-Selling
Shareholders and offer such Topco Shares to them, repeating the
process set out above.
If none of the Non-Selling Shareholders make a
binding offer to the Selling Shareholder, the Selling Shareholder
may enter into definitive documentation with a third-party
purchaser within the following 180 calendar days (with such period
being extended as required to satisfy any applicable mandatory
regulatory conditions) at any price. Again, once that 180 calendar
day period has expired, if the Selling Shareholder has not entered
into definitive documentation with a third-party purchaser and
still intends to sell any of its Topco Shares, it must re-approach
the Non-Selling Shareholders and offer such Topco Shares to them,
repeating the process set out above.
Other transfer
restrictions
Further provisions in respect of certain other
customary transfer restrictions (including, but not limited to, in
respect of the identity of the proposed transferee and requirements
in respect of compliance with anti-money laundering, anti-bribery
and corruption and anti-sanctions checks, adherence to the Topco
Shareholders' Agreement and receipt of necessary regulatory
approvals (if applicable)) will be set out in the Topco
Shareholders' Agreement, the Topco Articles and summarised in the
Scheme Document.
Tag
right
Excluding in respect of any transfer of Topco
Shares by KKR Investor to an affiliate of KKR Investor:
(a)
if KKR Investor proposes to transfer any Topco Shares to a third
party, Investor Shareholders shall have a customary pro rata "tag" right entitling them to
transfer, on the same terms and conditions as KKR Investor, a
proportionate number of its Topco Ordinary Shares to the
transferee; and
(b)
if KKR Investor proposes to transfer Topco Shares to a third party
and such transfer would result in a change of control of Topco,
Investor Shareholders shall have the right to transfer, on the same
terms and conditions as KKR Investor, all of their Topco Ordinary
Shares to the transferee.
Drag right
KKR Investor shall have a customary "drag"
right in respect of any transfer by KKR Investor of Topco Shares to
a third party where such transfer would result in a change of
control of Topco. The drag right will entitle KKR Investor to
require all Investor Shareholders to transfer their interests in
Topco on the same terms and conditions as KKR Investor to such
third party purchaser, provided that if the proposed sale
is:
(a)
prior to the fifth anniversary of the Effective Date, KKR Investor
will only be able to exercise its drag right with respect to an
Investor Shareholder if the price per Topco Share of the sale
triggering the drag right results in at least a 2.5x multiple on
invested capital for such Investor Shareholder; and
(b)
on or after the fifth anniversary but prior to the seventh
anniversary of the Effective Date, KKR Investor will only be able
to exercise its drag right with respect to an Investor Shareholder
if the price per Topco Share of the sale triggering the drag right
results in at least a 2x multiple on invested capital for such
Investor Shareholder.
After the seventh anniversary of the Effective
Date, KKR Investor's drag right will apply regardless of the
multiple on invested capital achieved by the relevant
sale.
12.
Fees
Any transaction, monitoring or other similar
fees payable by the Topco Group shall be paid to the Topco Ordinary
Shareholders in proportion to their holdings.
13.
Eligibility
In order to be eligible to participate in the
Alternative Offer, election by each IQGeo Shareholder will be
conditional on satisfying relevant regulatory requirements and
obligations under overseas securities laws and regulations. In
addition, Eligible IQGeo Shareholders who elect for the Alternative
Offer will be required to provide, and procure that their
affiliates and other related persons provide, to Bidco and KKR
Investor before any Topco Investor Shares can be allotted to them
such materials and information with respect to themselves (and, to
the extent applicable, their directors, shareholders, affiliates
and other relevant parties) as requested by Bidco and KKR Investor
in order to satisfy Bidco, KKR Investor and their affiliates' "Know
Your Client" checks (including pursuant to obligations under the
U.S. Uniting and Strengthening America by Providing Appropriate
Tools Required to Intercept and Obstruct Terrorism Act of 2001, the
Currency and U.S. Foreign Transactions Reporting Act of 1970, the
UK Money Laundering, Terrorist Financing and Transfer of Funds
(Information on the Payer) Regulations 2017 and the Joint Money
Laundering Steering Group Guidance Notes (or analogous equivalent)
and/or the Luxembourg law of 12 November 2004 on the fight against
money laundering and terrorist financing (as amended)). Further
details regarding the information to be provided, and the manner in
which it should be provided, will be set out in the Scheme
Document.
14.
Terms of the Alternative Offer in
the event of a switch
In the event that Bidco elects, with the
consent of the Panel and subject to the Co-operation Agreement, to
switch to a Takeover Offer, and less than 100 per cent. of the
IQGeo Shares have been acquired by Bidco (pursuant to acceptances
of the Takeover Offer or otherwise) on or around the date on which
the Alternative Offer closes (the "Scale-back Date"), the total number of
Topco Offer Shares issued to KKR Investor and Investor Shareholders
on or around the Scale-back Date (inclusive of any Topco Shares
already issued to KKR Investor prior to such date) will be reduced
pro rata such that the
maximum number of Topco Investor Shares available to IQGeo
Shareholders under the Alternative Offer will remain equal to the
equivalent of 30 per cent. of the total Topco Offer Shares
following the settlement of consideration due to IQGeo Shareholders
who have accepted the Takeover Offer (either the Cash Offer or the
Alternative Offer) on or before the Scale-back Date.
In that event, to the extent the elections for
the Alternative Offer are unable to be satisfied in full, the
entitlement to Topco Investor Shares of each IQGeo Shareholder who
has made a valid election will be reduced on a pro rata basis and rounded down to the
nearest whole number, and the balance of the consideration due to
such IQGeo Shareholder will be paid in cash in accordance with the
terms of the Cash Offer.
If, following a scale-back of the Alternative
Offer elections as described above, (i) further IQGeo Shares are
acquired for cash by or on behalf of Bidco after the Scale-back
Date (under the Cash Offer or the compulsory acquisition procedure
or otherwise), and (ii) the Topco Ordinary Shares or the Topco
Redeemable Shares to be issued to fund those acquisitions were not
included in the calculation of the above 30 per cent. maximum
entitlement of the Investor Shareholders, any additional Topco
Ordinary Shares and Topco Redeemable Shares (together, the
"Additional Topco Cash Funding
Shares") which are to be issued in order to fund those cash
acquisitions, will be allocated as follows (either by way of
pre-emption or catch-up rights), in order to give the Investor
Shareholders an opportunity to maintain their percentage holding of
Topco Shares:
(a)
30 per cent. of the Additional Topco Cash Funding Shares shall be
offered to the Investor Shareholders in the form of Topco Ordinary
Shares for subscription on a pro
rata basis;
(b)
61 per cent. of the Additional Topco Cash Funding Shares shall be
issued to KKR Investor in the form of Topco Ordinary Shares;
and
(c) 9
per cent. of the Additional Topco Cash Funding Shares shall be
issued to KKR Investor in the form of Topco Redeemable
Shares.
If, however, the Additional Topco
Cash Funding Shares offered to the Investor Shareholders under
paragraph (a) above are not taken up in full the total number of
Topco Ordinary Shares to be issued to the Investor Shareholders
under paragraph (a) will be reduced accordingly, and the balance of
the Additional Topco Cash Funding Shares will instead be issued to
KKR Investor in the form of (i) additional Topco Redeemable Shares
up to the Topco Redeemable Share Maximum; and (ii) additional Topco
Ordinary Shares (for the balance).
15.
Governing law and
jurisdiction
It is intended that the Topco Shareholders'
Agreement and any non-contractual or other obligations arising out
of or in connection with it shall be governed by English law. The
courts of England will have exclusive jurisdiction to decide any
dispute which may arise out of or in connection with the Topco
Shareholders' Agreement.
Appendix 5
DEFINITIONS
The following definitions apply throughout this
Announcement unless the context requires otherwise:
"Adjusted EBITDA"
|
as defined on page 28 of IQGeo FY2023
ARA;
|
"Adjusted EBITDAC"
|
Adjusted EBITDA less capitalised product
development costs for the same period;
|
"AIM" or "AIM Market"
|
the AIM Market of the London Stock
Exchange;
|
"AIM Rules"
|
the AIM Rules for Companies published by the
London Stock Exchange, as amended from time to time;
|
"Acquisition"
|
the recommended acquisition by Bidco of the
entire issued and to be issued ordinary share capital of IQGeo not
already owned or controlled by the Bidco Group, to be implemented
by means of the Scheme (or by way of a Takeover Offer, where Bidco
so elects under certain circumstances described in this
Announcement) and, where the context requires, any subsequent
revision, variation, extension or renewal thereof;
|
"Additional Topco Cash Funding
Shares"
|
has the meaning given in paragraph
14 of Appendix 4 to this
Announcement;
|
"Alternative Offer"
|
has the meaning given in paragraph 2 of this
Announcement;
|
"Alternative Offer Maximum"
|
has the meaning given in paragraph 13 of this
Announcement;
|
"Announcement"
|
this announcement;
|
"Authorisations"
|
regulatory authorisations, orders,
determinations, recognitions, grants, consents, clearances,
confirmations, certificates, licences, permissions, exemptions or
approvals;
|
"Bidco"
|
Geologist Bidco Limited, a private limited
company incorporated under the laws of England and Wales with
registered number 15702303;
|
"Bidco Group"
|
Bidco and its parent undertakings and its and
such parent undertakings' subsidiary undertakings and associated
undertakings;
|
"Business Day"
|
a day (other than Saturdays, Sundays and public
holidays in the UK) on which banks are open for business in the
City of London;
|
"Cash Offer"
|
has the meaning given in paragraph 2 of this
Announcement;
|
"Cavendish"
|
Cavendish Capital Markets Limited;
|
"Closing Price"
|
the closing middle market price of an IQGeo
Share on a particular trading day as derived from
Bloomberg;
|
"Companies Act"
|
the Companies Act 2006 (as amended from time to
time);
|
"Conditions"
|
the conditions to the implementation of the
Acquisition, as set out in Part A of Appendix 1 to this
Announcement and to be set out in the Scheme Document;
|
"Confidentiality Agreement"
|
the confidentiality agreement between Kohlberg
Kravis Roberts & Co. Partners LLP and IQGeo dated 25 March
2024;
|
"Co-operation Agreement"
|
the agreement dated 14 May 2024 between Bidco
and IQGeo relating to, among other things, the implementation of
the Acquisition;
|
"Court"
|
the High Court of Justice in England and
Wales;
|
"Court Meeting"
|
the meeting of Scheme Shareholders to be
convened pursuant to an order of the Court under Part 26 of the
Companies Act for the purpose of considering and, if thought fit,
approving the Scheme, including any adjournment thereof;
|
"Court Order"
|
the order of the Court sanctioning the Scheme
under Part 26 of the Companies Act;
|
"CPC"
|
Commission for the Protection of Competition of
the Republic of Cyprus;
|
"CREST"
|
the system for the paperless settlement of
trades in securities and the holding of uncertificated securities
operated by Euroclear;
|
"Disclosed"
|
the information fairly disclosed by, or on
behalf of IQGeo: (i) in the IQGeo FY2023 ARA; (ii) in this
Announcement; (iii) in any other announcement to a Regulatory
Information Service by, or on behalf of IQGeo before the
publication of this Announcement; (iv) in the virtual data room
operated on behalf of IQGeo for the purposes of the Acquisition
(which Bidco and/or its advisers were able to access prior to the
date of this Announcement); or (v) as otherwise fairly disclosed to
Bidco (or its officers, employees, agents or advisers in each case
in their capacity as such) in writing before the date of this
Announcement;
|
"Effective Date"
|
the date on which either: (i) the Scheme
becomes effective in accordance with its terms; or (ii) (if Bidco
elects to implement the Acquisition by way of a Takeover Offer,
subject to Panel consent and the terms of the Co-operation
Agreement), the date on which such Takeover Offer becomes or is
declared unconditional in accordance with the requirements of the
Takeover Code, and "Effective" shall be construed
accordingly;
|
"Eligible IQGeo Shareholder"
|
an IQGeo Shareholder that satisfies the
requirements of paragraph 13 of Appendix
4 to this Announcement;
|
"Euroclear"
|
Euroclear UK & International
Limited;
|
"Evercore"
|
Evercore Partners International LLP;
|
"Excluded Shares"
|
(i) any IQGeo Shares of which Bidco or any
member of the Bidco Group is the holder or in which Bidco or any
member of the Bidco Group is beneficially interested at the Scheme
Record Time; or (ii) any IQGeo Shares which are for the time being
held by IQGeo as treasury shares (within the meaning of the
Companies Act);
|
"Exit ARR"
|
exit annual recurring revenue, as defined on
page 26 of IQGeo FY2023 ARA, being the current go forward run rate
of annually renewable subscription and maintenance & support
agreements;
|
"FCA" or "Financial Conduct Authority"
|
the Financial Conduct Authority acting in its
capacity as the competent authority for the purposes of Part VI of
the UK Financial Services and Markets Act 2000, or any successor
regulatory body;
|
"Form of Election"
|
the form of election to be sent to Scheme
Shareholders by or on behalf of IQGeo pursuant to which a Scheme
Shareholder (other than certain Overseas Shareholders) may make an
election to receive the Alternative Offer;
|
"Forms of Proxy"
|
the forms of proxy in connection with each of
the Court Meeting and General Meeting which will accompany the
Scheme Document;
|
"FSMA"
|
the Financial Services and Markets Act 2000 (as
amended from time to time);
|
"FY2022"
|
the financial year ended 31 December
2022;
|
"FY2023"
|
the financial year ended 31 December
2023;
|
"General Meeting"
|
the general meeting of IQGeo Shareholders
(including any adjournment thereof) to consider and, if thought
fit, pass the IQGeo Resolution(s);
|
"Investor Shareholders"
|
holders of Topco Investor Shares;
|
"In-year Recurring Revenue"
|
as defined on page 26 of IQGeo FY2023 ARA,
being the value of annual recurring revenue agreements from IQGeo
product sales that are taken to revenue in IQGeo's consolidated
income statement;
|
"IQGeo" or "the Company"
|
IQGeo Group plc, a public limited company
incorporated in England and Wales with registered number
05589712;
|
"IQGeo Articles"
|
the articles of association of IQGeo in force
from time to time;
|
"IQGeo Directors" or "IQGeo Board" or "Board"
|
the directors of IQGeo;
|
"IQGeo FY2023 ARA"
|
the annual report and accounts of IQGeo for
FY2023;
|
"IQGeo Group"
|
IQGeo and its subsidiary undertakings and where
the context permits, each of them;
|
"IQGeo Resolution(s)"
|
such shareholder resolution(s) of IQGeo as are
necessary to approve, implement and effect the Scheme and the
Acquisition including, amongst other things, to make certain
amendments to the IQGeo Articles;
|
"IQGeo Share Plans"
|
the IQGeo Group plc 2020 Share Option Plan, the
IQGeo Group plc 2020 Share Option Plan US Sub-plan, the IQGeo Group
plc 2020 Share Option Plan Canadian Sub-plan and the Ubisense Group
plc Long Term Incentive and Share Option Plan 2016 (in each case as
amended from time to time);
|
"IQGeo Shareholders"
|
the holders of IQGeo Shares;
|
"IQGeo Shares"
|
the existing unconditionally allotted or issued
and fully paid ordinary shares of 2 pence each in the capital of
IQGeo and any further such ordinary shares which are
unconditionally allotted or issued;
|
"Kestrel Partners"
|
Kestrel Partners LLP;
|
"KKR"
|
Kohlberg Kravis Roberts & Co. L.P. and its
affiliates;
|
"KKR Investor"
|
an entity to be incorporated at the direction
of, and directly or indirectly wholly owned by, funds advised by
KKR for purpose of implementing the Acquisition;
|
"Latest Practicable Date"
|
13 May 2024, being the last Business Day prior
to the date of this Announcement;
|
"London Stock Exchange"
|
London Stock Exchange plc;
|
"Long Stop Date"
|
11.59 pm on 14 February 2025 or such later time
or date, if any, (a) as IQGeo and Bidco may agree, or (b) (in a
competitive situation) as may be specified by Bidco with the
consent of the Panel, and in each case that (if so required) the
Court may allow;
|
"Offer Period"
|
the offer period (as defined by the Takeover
Code) relating to IQGeo, which commenced on the date of this
Announcement;
|
"Opening Position Disclosure"
|
has the same meaning as in Rule 8 of the
Takeover Code;
|
"Overseas Shareholders"
|
IQGeo Shareholders (or nominees of, or
custodians or trustees for IQGeo Shareholders) not resident in, or
nationals or citizens of the United Kingdom;
|
"Panel"
|
the Panel on Takeovers and Mergers;
|
"Qualified Investor
Shareholder"
|
has the meaning given in paragraph 6 of
Appendix 4 to this Announcement;
|
"Registrar of Companies"
|
the Registrar of Companies in England and
Wales;
|
"Regulatory Information
Service"
|
any information service authorised from time to
time by the FCA for the purpose of disseminating regulatory
announcements;
|
"Reserved Matters"
|
has the meaning given in paragraph
8 of Appendix 4 to this Announcement;
|
"Restricted Jurisdiction"
|
any jurisdiction (other than the United
Kingdom) into which making the Acquisition (including the
Alternative Offer), distributing information relating to the
Acquisition, or paying consideration pursuant to the Acquisition
(including issuing Topco Investor Shares or associated loan notes
or other instruments) may result in a significant risk of civil,
regulatory or criminal exposure or would or may require Bidco or
KKR (as the case may be) to comply with any requirements which in
its absolute discretion is regarded as unduly onerous;
|
"Rothschild & Co"
|
N.M. Rothschild & Sons Limited;
|
"Scale-back Date"
|
has the meaning given in paragraph
14 of Appendix 4 to this
Announcement;
|
"Scheme"
|
the proposed scheme of arrangement under Part
26 of the Companies Act between IQGeo and Scheme Shareholders in
connection with the Acquisition, with or subject to any
modification, addition or condition approved or imposed by the
Court and agreed by IQGeo and Bidco;
|
"Scheme Document"
|
the document to be sent to IQGeo Shareholders
containing, amongst other things, the Scheme and the notices
convening the Court Meeting and General Meeting;
|
"Scheme Record Time"
|
the time and date to be specified in the Scheme
Document, expected to be 6.00 pm on the date of the Court hearing
to sanction the Scheme;
|
"Scheme Shareholder"
|
a holder of Scheme Shares;
|
"Scheme Shares"
|
all IQGeo Shares:
|
|
(i) in issue at the date of the Scheme Document
and which remain in issue at the Scheme Record Time;
|
|
(ii) (if any) issued after the date of the
Scheme Document and before the Scheme Voting Record Time, which
remain in issue at the Scheme Record Time; and
|
|
(iii) (if any) issued at or after the Scheme
Voting Record Time but on or before the Scheme Record Time either
on terms that the original or any subsequent holders thereof shall
be bound by the Scheme or in respect of which the original or any
subsequent holders thereof are, or shall have agreed in writing to
be, so bound, and in each case which remain in issue at the Scheme
Record Time,
|
|
in each case other than any Excluded
Shares;
|
"Scheme Voting Record Time"
|
the date and time to be specified in the Scheme
Document by reference to which entitlement to vote at the Court
Meeting will be determined;
|
"Significant Interest"
|
in relation to an undertaking, a direct or
indirect interest of 20 per cent, or more of the total voting
rights conferred by the equity share capital (as defined in section
548 of the Companies Act) of such undertaking;
|
"SONIA"
|
sterling overnight index average reference rate
displayed on the relevant screen of any authorised distributor of
that reference rate;
|
"Takeover Code"
|
the City Code on Takeovers and Mergers (as
amended from time to time);
|
"Takeover Offer"
|
subject to the consent of the Panel and the
terms of the Co-operation Agreement, should the Acquisition be
implemented by way of a takeover offer as defined in Chapter 3 of
Part 28 of the Companies Act, the offer to be made by or on behalf
of Bidco to acquire the entire issued and to be issued share
capital of IQGeo, other than IQGeo Shares owned or controlled by
the Bidco Group and, where the context admits, any subsequent
revision, variation, extension or renewal of such offer;
|
"Third Party"
|
each of a central bank, state, government or
governmental, quasi-governmental, supranational, statutory,
regulatory, environmental, administrative, professional, fiscal or
investigative body, court, trade agency, association, institution,
body, employee representative body, any entity owned or controlled
by any government or state, or any other body or person whatsoever
in any jurisdiction;
|
"Topco"
|
a limited company to be incorporated in England
and Wales for the purpose of implementing the Acquisition, which
will hold directly or indirectly the entire issued share capital of
Bidco;
|
"Topco Articles"
|
the articles of association of
Topco;
|
"Topco Board"
|
the board of directors of Topco;
|
"Topco Group"
|
Topco and its direct and indirect subsidiaries
including, following completion of the Acquisition, the IQGeo
Group;
|
"Topco Investor Shares"
|
the Topco Ordinary Shares to be issued to
Eligible IQGeo Shareholders who validly elect for the Alternative
Offer pursuant to the Acquisition;
|
"Topco Offer Shares"
|
has the meaning given in paragraph 13 of this
Announcement, and in the event that the Acquisition is implemented
by way of a Takeover Offer, as interpreted in accordance with
paragraph 14 of Appendix
4 to this Announcement;
|
"Topco Ordinary Shareholders"
|
holders of Topco Ordinary Shares;
|
"Topco Ordinary Shares"
|
ordinary shares in the capital of Topco in
issue from time to time;
|
"Topco Redeemable Shares"
|
the redeemable preference shares in the capital
of Topco the terms of which are described in paragraph
13 of this Announcement and
Appendix 4 to this
Announcement;
|
"Topco Redeemable Share
Maximum"
|
number of Topco Redeemable Shares equal to £60
million divided by the Topco Redeemable Share Subscription Amount,
rounded down to the nearest whole number;
|
"Topco Redeemable Share Subscription
Amount"
|
the subscription amount, in pounds sterling,
for each Topco Redeemable Share paid by KKR Investor on or around
the Effective Date, expected to comprise:
(i) the sum
of (A) 480 pence multiplied
by the fully diluted share capital of IQGeo; and (B) fees,
costs and expenses incurred by the Topco Group in connection with
the Acquisition, divided
by
(ii)
the total number of Topco Shares that would need to be issued to
implement the acquisition of the fully diluted share capital of
IQGeo;
|
"Topco Shareholders'
Agreement"
|
the shareholders' agreement to be entered into
by KKR Investor and the Investor Shareholders, from time to
time;
|
"Topco Shares"
|
Topco Ordinary Shares and Topco Redeemable
Shares in issue from time to time;
|
"Topco Sponsor Shares"
|
the Topco Ordinary Shares to be issued to KKR
Investor;
|
"uncertificated"
|
a share or other security title to which is
recorded in the relevant register of the share or security as being
held in uncertificated form, in CREST, and title to which, by
virtue of the Uncertificated Securities Regulations 2001 (as
amended) may be transferred by means of CREST;
|
"United Kingdom" or "UK"
|
the United Kingdom of Great Britain and
Northern Ireland;
|
"United States" or "US"
|
the United States of America, its territories
and possessions, any state of the United States of America, the
District of Columbia and all other areas subject to its
jurisdiction and any political sub-division thereof;
|
"UK NSI
Act"
|
the UK National Security and Investment Act
2021, together with all associated secondary legislation and
regulatory rules;
|
"US Securities Act"
|
US Securities Act 1933;
|
"US Exchange Act"
|
the United States Securities Exchange Act of
1934, and the rules and regulations promulgated
thereunder;
|
"Wider Bidco Group"
|
Bidco, funds and separately managed accounts
advised and/or managed by KKR and their respective associated
undertakings and any other body corporate, partnership, joint
venture or person in which Bidco and all such undertakings
(aggregating their interests) have a direct or indirect interest of
more than 20 per cent. of the voting or equity capital or the
equivalent; and
|
"Wider IQGeo Group"
|
IQGeo and associated undertakings and any other
body corporate, partnership, joint venture or person in which IQGeo
and all such undertakings (aggregating their interests) have a
Significant Interest.
|
For the purposes of this Announcement,
"subsidiary", "subsidiary undertaking", "undertaking" and "associated undertaking" have the
respective meanings given thereto by the Companies Act.
All references to "pounds", "pounds sterling", "Sterling", "£", "pence", "penny" and "p" are to the lawful currency of the
United Kingdom.
All the times referred to in this Announcement
are London times unless otherwise stated.
References to the singular include the plural
and vice versa.