Press release pursuant to Article 8 §1 of the Belgian Royal Decree of 27 April 2007 on takeover bids (the “Belgian Takeover Decree”)
THIS ANNOUNCEMENT IS NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN WHOLE OR IN PART, DIRECTLY OR INDIRECTLY, IN OR INTO OR FROM ANY JURISDICTION WHERE TO DO SO WOULD CONSTITUTE A VIOLATION OF THE RELEVANT LAWS OF THAT JURISDICTION.
THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION FOR THE PURPOSES OF ARTICLE 7 OF REGULATION (EU) NO 596/2014 ON MARKET ABUSE REGULATION ("MAR"). UPON THE PUBLICATION OF THIS ANNOUNCEMENT, THE INSIDE INFORMATION IS NOW CONSIDERED TO BE IN THE PUBLIC DOMAIN FOR THE PURPOSES OF MAR.
CONGRA SOFTWARE AND GLOBAL GRAPHICS DECIDE NOT TO PROCEED WITH SCHEME OF ARRANGEMENT. CONGRA SOFTWARE ENTERS INTO AGREEMENTS TO ACQUIRE AN INITIAL 17.04% PERCENT (APPROXIMATELY) OF THE VOTING RIGHTS IN THE SHARE CAPITAL OF GLOBAL GRAPHICS AT A PRICE OF EUR 4.25 PER SHARE AND, UPON COMPLETION, WILL LAUNCH A MANDATORY OFFER FOR THE REMAINING ISSUED SHARE CAPITAL OF GLOBAL GRAPHICS
Cambridge, U.K. & Belgium 13 November 2018 (08:00 CET)
Global Graphics PLC (Euronext: GLOG) (“Global Graphics”) and Congra Software Sàrl (“Congra”) have decided not to proceed with the scheme of arrangement announced on 5 October 2018 (the “Scheme”). Congra has instead entered into two agreements on 12 November 2018 to acquire the issued shares in Global Graphics which are held respectively by Clema Capital Sàrl (i.e. 1,517,171 shares, representing 13.10% of the voting rights of Global Graphics (approximately)) and Mr. Johan Volckaerts (i.e. 455,897 shares, representing 3.94% of the voting rights in Global Graphics (approximately)) (totalling 1,973,068 shares and representing 17.04% of the voting rights in Global Graphics (approximately)) (together the “Acquisitions”). The Acquisitions relate to a total of 1,973,068 issued shares in Global Graphics (representing a 17.04% of the voting rights in Global Graphics (approximately)) for an aggregate consideration of EUR 8,385,539.00.
The purchase price payable by Congra for these Acquisitions is EUR 4.25 per Global Graphics share, representing a premium of 11.47% to the 30-day volume-weighted average trading price of the Global Graphics shares on Euronext Brussels, for the 30-day period ending on 5 October 2018 (i.e. the date of the announcement of the Scheme*), and 13.5% to the three-month average closing share price of Global Graphics for the three-month period ending on 5 October 2018. The purchase price for the Acquisitions will be payable by Congra in cash.
The completion of each Acquisition is expected to take place on or around 26 November 2018.
As Global Graphics is a company with its registered office in England and Wales that is only admitted to trading on Euronext Brussels, the shared jurisdiction rules pursuant to article 4 of the E.U. Directive 2004/25/EC of 21 April 2004 on Takeover Bids (the “Takeover Directive”) apply. Accordingly, the mandatory offer will fall under the shared jurisdiction of the U.K. Panel on Takeovers and Mergers in the UK (the “UK Takeover Panel”) and the FSMA in Belgium, who will jointly regulate this transaction (as more fully described below).
Congra is affiliated with Powergraph BVBA (“Powergraph”). Both companies are co-controlled by Mr. Guido Van der Schueren**. Powergraph currently holds 1,640,000 shares in Global Graphics, representing 14.17% of the voting rights (approximately).
Under the UK City Code on Takeovers and Mergers (the “UK Takeover Code”) Congra and Powergraph are considered to be “acting in concert” and, as a consequence of Congra entering into the agreements in connection with the Acquisitions, are considered together to be interested in more than 30% of the issued share capital of Global Graphics. Accordingly, Congra has incurred an obligation under the UK Takeover Code to make a general offer for the rest of the issued share capital of Global Graphics.
The offer will be a mandatory offer under the Takeover Directive.
Congra has notified both the UK Takeover Panel and FSMA of its intention to make the mandatory offer upon completion of the Acquisitions and will make all required filings shortly after completion of the Acquisitions in accordance with its legal obligations.
The UK Takeover Code will apply to the mandatory offer in respect of matters relating to the information to be provided to the employees of Global Graphics and matters relating to UK company law (in particular the percentage of voting rights which confers control and any derogation from the obligation to launch an offer, as well as the conditions under which the board of Global Graphics may undertake any action which might result in the frustration of an offer) (“employee information and company law matters”). Such employee information and company law matters will be administered by the UK Takeover Panel.
The Belgian Takeover Decree will apply in relation to matters relating to the consideration offered (in particular the price) and matters relating to the offer procedure (in particular the information on Congra’s decision to make an offer, the contents of the offer document and the disclosure of the offer) (“consideration and procedural matters”). Such consideration and procedural matters will be administered by FSMA.
Congra will make the mandatory offer at a price of EUR 4.25 per Global Graphics share, which is the same price as the purchase price for the Acquisitions. In accordance with applicable Belgian market regulations, the mandatory offer will be unconditional.
If relevant squeeze-out conditions are met, Congra intends to launch a squeeze-out process to compulsorily acquire all the remaining issued shares in Global Graphics that are not owned by Congra (or its concert parties/associates) at that time.
The views of the Global Graphics board on the terms of the mandatory offer will be made available to the Global Graphics shareholders in accordance with applicable Belgian rules.
This announcement is for information purposes only. It is not intended to, and does not, constitute or form part of any offer or invitation to purchase, otherwise acquire, subscribe for, sell or otherwise dispose of, any securities or the solicitation of any vote or approval in any jurisdiction.
This announcement does not constitute a prospectus or a prospectus equivalent document.
The release, publication or distribution of this announcement in jurisdictions other than the United Kingdom or Belgium may be restricted by law and therefore any persons who are not resident in the United Kingdom or Belgium who are subject to the laws of any jurisdiction other than the United Kingdom or Belgium (including any jurisdiction where local laws or regulations may result in a significant risk of civil, regulatory or criminal exposure if information concerning Global Graphics or Congra or the transactions described in this press release is sent or made available to Global Graphics shareholders in that jurisdiction should inform themselves about, and observe, any applicable legal or regulatory requirements). Any failure to comply with applicable legal or regulatory requirements of any jurisdiction may constitute a violation of securities laws in that jurisdiction. To the fullest extent permitted by applicable law, Global Graphics and Congra disclaim any responsibility or liability for the violation of such restrictions by any person.
* For the calculation of this 30-day average, 5 October 2018 (i.e. the date of the announcement of the Scheme) is used as an end date in view of speculative purchases being made on the market since the announcement of the Scheme, artificially pushing up the prices of the shares.
** Mr. Van der Schueren owns 67.08% of Congra’s share capital through Powergraph and the private foundation Graphicus Private Stichting (“Graphicus”), an entity owned by Mr. Van der Schueren (with a minority stake owned by his children). Powergraph, in turn, is controlled by Graphicus (i.e. owning 1,985,274 shares in Powergraph, representing 99.81% of the voting rights in Powergraph (approximately)).