TIDMEZH
RNS Number : 2111F
easyHotel PLC
06 March 2020
THIS ANNOUNCEMENT AND THE INFORMATION CONTAINED HEREIN IS
RESTRICTED AND IS NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN
WHOLE OR IN PART, DIRECTLY OR INDIRECTLY, IN, INTO OR FROM THE
UNITED STATES, AUSTRALIA, CANADA, JAPAN, SOUTH AFRICA OR ANY OTHER
JURISDICTION IN WHICH SUCH RELEASE, PUBLICATION OR DISTRIBUTION
WOULD BE UNLAWFUL.
6 March 2020
easyHotel plc
("easyHotel", "the Group" or "the Company")
Proposed Subscription of 11,578,948 Subscription Shares at 95.0
pence per share by Citrus Holdco
easyHotel plc, the owner, developer, operator and franchisor of
super budget branded hotels, today announces a conditional
fundraising of GBP11 million (gross) by way of a subscription and
issue of 11,578,948 Subscription Shares (the "Subscription Shares")
at a price of 95.0 pence per Subscription Share (the "Subscription
Price") (the "Subscription") by Citrus Holdco.
Highlights
-- Gross proceeds of the Subscription of approximately GBP11 million before expenses.
-- Subscription Price represents a premium of approximately 35.7
per cent. to the closing mid-market price of 70 pence per Existing
Ordinary Share on 5 March 2020 (being the latest practicable date
prior to the publication of this Announcement).
-- Proceeds of the Subscription will be primarily utilised to
fund the Group's owned hotel roll-out strategy.
-- Subscription conditional on, inter alia, the passing of the
Resolutions which are to be proposed at a General Meeting of the
Company to be held on 25 March 2020 and Admission taking place by
no later than 26 March 2020.
Founded in 2004 by Sir Stelios Haji-Ioannou, easyHotel's
strategy is to target the super budget segment of the hotel
industry by offering great value and "clean, comfortable and safe"
hotel rooms to its customers. Citrus Holdco, a company owned by a
consortium comprising Cadim Fonds Inc (part of Ivanhoé Cambridge)
and ICAMAP Investments S.à.r.l, through its Offer for the ordinary
share capital of the Company at a price of 95.0 pence per Ordinary
Share that closed on 1 October 2019, acquired approximately 68.8
per cent of the Existing Ordinary Shares. At the time of its Offer,
Citrus Holdco shared the Company's strategy and acknowledged at the
time of its Offer that significant investment is required to
achieve this strategy and to ensure the Group can fulfil its
potential as a leading European budget hotel company.
Scott Christie, Interim Chief Executive Officer, commented:
"Our recently announced investment in Spain marks the latest
step in our strategy to expand our owned hotel network across
centrally located, high quality sites in major European cities. The
Group continues to make good progress towards securing sites in its
target destinations and we look forward to announcing further
developments in due course."
Harm Meijer, Non-executive Chairman, commented:
"Citrus Holdco Limited confirmed at the time of its Offer for
easyHotel's shares last year that it was committed to supporting
easyHotel to achieve the Board's strategic vision for the business
more quickly and effectively. The proceeds from this proposed
subscription will provide the business with the capital it needs to
pursue the next stage of its owned hotel roll-out strategy. We are
excited about the development pipeline and, in particular, the
potential for accelerating our targeted growth of the brand in
Europe"
A circular, extracts of which are set out below, containing a
notice of General Meeting of the Company (the "Circular"), convened
for 10.00 a.m. on 25 March 2020, will be sent to Shareholders today
convening the General Meeting at which the Resolutions will be
tabled. A copy of the Circular will also be made available on the
Company's website, http://ir.easyhotel.com . Capitalised terms used
in this Announcement but not otherwise defined have the meaning
given to those terms in the Circular, unless otherwise
indicated.
Enquiries:
easyHotel plc via Houston PR
Scott Christie, Interim Chief Executive
Officer
Harm Meijer, Non-Executive Chairman
Investec Bank plc - Nominated Adviser and +44 (0) 20 7597
Broker 5970
David Anderson, Toba Fatimilehin
+44 (0) 20 3701
Houston PR - PR Adviser to easyHotel 7660
Kate Hoare / Laura Stewart
Notes to Editors:
www.easyhotel.com http://ir.easyhotel.com
easyHotel is the owner, developer, operator and franchisor of
branded hotels. Its strategy is to target the super budget segment
of the hotel industry by marketing "clean, comfortable and safe"
hotel rooms to its customers.
Operating hotels
easyHotel has an estate of 40 hotels with 3,759 rooms,
comprising 27 franchised hotels (2,332 rooms) and 13 owned hotels
(1,427 rooms).
Owned hotels:
United Kingdom: Old Street (London), Glasgow, Croydon,
Birmingham, Manchester, Liverpool, Newcastle*, Leeds, Sheffield,
Ipswich, Milton Keynes.
Spain: Barcelona
France: Nice
Franchise locations:
United Kingdom: Edinburgh, London Heathrow, Central London,
Luton, Reading and Belfast.
Europe: Belgium (Brussels), Bulgaria (Sofia), Germany (Berlin,
Frankfurt, Bernkastel-Kues), Hungary (Budapest), The Netherlands
(Amsterdam: City, Arena & Zaandam, Amsterdam Schiphol Airport,
Rotterdam, The Hague, The Hague Scheveningen Beach, Maastricht),
Portugal (Lisbon), Switzerland (Basel, Zurich).
International: UAE (Dubai).
Hotel development pipeline
Owned hotels:
United Kingdom: Chester, Cardiff, Oxford*, Blackpool, Cambridge*
and Bristol(#) .
Europe: Ireland (Dublin), France (Paris-Charles de Gaulle
Airport*), Spain (Madrid)
Franchise hotels:
United Kingdom: Derby
Europe: Spain (Malaga), Switzerland (Zurich: City Centre,
Limmatplatz).
International: Israel (Tel Aviv - three locations)
* Hotels under an operating lease.
(#) Subject to planning permission.
This Announcement should be read in its entirety. In particular,
you should read and understand the information provided in the
"Important Notices" section of this Announcement.
IMPORTANT NOTICES
This Announcement may contain and the Company may make verbal
statements containing "forward-looking statements" with respect to
certain of the Company's plans and its current goals and
expectations relating to its future financial condition,
performance, strategic initiatives, objectives and results.
Forward-looking statements sometimes use words such as "aim",
"anticipate", "target", "expect", "estimate", "intend", "plan",
"goal", "believe", "seek", "may", "could", "outlook" or other words
of similar meaning. By their nature, all forward-looking statements
involve risk and uncertainty because they relate to future events
and circumstances which are beyond the control of the Company,
including amongst other things, United Kingdom domestic and global
economic business conditions, market-related risks such as
fluctuations in interest rates and exchange rates, the policies and
actions of governmental and regulatory authorities, the effect of
competition, inflation, deflation, the timing effect and other
uncertainties of future acquisitions or combinations within
relevant industries, the effect of tax and other legislation and
other regulations in the jurisdictions in which the Company and its
respective affiliates operate, the effect of volatility in the
equity, capital and credit markets on the Company's profitability
and ability to access capital and credit, a decline in the
Company's credit ratings; the effect of operational risks; and the
loss of key personnel. As a result, the actual future financial
condition, performance and results of the Company may differ
materially from the plans, goals and expectations set forth in any
forward-looking statements. Any forward-looking statements made in
this Announcement by or on behalf of the Company speak only as of
the date they are made. Except as required by applicable law or
regulation, the Company expressly disclaims any obligation or
undertaking to publish any updates or revisions to any
forward-looking statements contained in this Announcement to
reflect any changes in the Company's expectations with regard
thereto or any changes in events, conditions or circumstances on
which any such statement is based.
Investec is authorised by the Prudential Regulation Authority
and regulated by the Financial Conduct Authority and the Prudential
Regulation Authority in the United Kingdom and is acting
exclusively for the Company and no one else in connection with the
Subscription, and Investec will not be responsible to anyone other
than the Company for providing the protections afforded to its
clients or for providing advice in relation to the Subscription or
any other matters referred to in this Announcement.
No representation or warranty, express or implied, is or will be
made as to, or in relation to, and no responsibility or liability
is or will be accepted by Investec or by any of its affiliates or
agents as to, or in relation to, the accuracy or completeness of
this Announcement or any other written or oral information made
available to or publicly available to any interested party or its
advisers, and any liability therefore is expressly disclaimed.
The distribution of this Announcement in certain jurisdictions
may be restricted by law. This Announcement is for information
purposes only and does not constitute or form part of any offer to
issue or sell, or the solicitation of an offer to acquire, purchase
or subscribe for, any securities in the United States, Australia,
Canada, Japan or South Africa or in any jurisdiction in which such
offer or solicitation would be unlawful and should not be relied
upon in connection with any decision, or as any inducement, to
subscribe for or acquire any new Ordinary Shares. In particular,
this Announcement does not constitute or form part of any offer to
issue or sell, or the solicitation of an offer to acquire, purchase
or subscribe for, any securities in the United States. No public
offer of securities is being made in the United Kingdom or
elsewhere.
This Announcement is not an offer of securities for sale or a
solicitation of any offer to purchase securities in the United
States. Subscription Shares may not be offered or sold in the
United States absent registration under the US Securities Act of
1933, as amended (the "US Securities Act") or an exemption
therefrom. The Company has not and does not intend to register any
securities under the US Securities Act and does not intend to offer
any securities to the public in the United States. No money,
securities or other consideration from any person inside the United
States is being solicited and, if sent in response to the
information contained in this Announcement, will not be accepted.
The Subscription Shares have not been and will not be registered
with any regulatory authority of any state within the United
States.
This Announcement contains inside information for the purposes
of Article 7 of EU Regulation 596/2014 ("MAR"). In addition, market
soundings (as defined in MAR) were taken in respect of the
Subscription with the result that certain persons became aware of
inside information (as defined in MAR), as permitted by MAR. This
inside information is set out in this Announcement. Therefore,
those persons that received inside information in a market sounding
are no longer in possession of such inside information relating to
the Company and its securities.
Subscription of 11,578,948 Subscription Shares at 95.0 pence per
share by Citrus Holdco
1. Introduction
easyHotel plc ("easyHotel", "the Group" or "the Company") today
announces on 6 March 2020 an equity fundraising of approximately
GBP11.0 million (gross) (approximately GBP10.97 million (net)) by
way of a subscription and issue of 11,578,948 Subscription Shares
at a price of 95.0 pence per Subscription Share.
The Subscription is conditional upon, amongst other things,
Shareholder approval of the Resolutions which will be sought at the
forthcoming General Meeting to be held in the Courtyard Meeting
Room, Somerset House, The Strand, London WC2R 1LA at 10.00 a.m. on
25 March 2020 and Admission becoming effective.
2. Background to and reasons for the Subscription
Founded in 2004 by Sir Stelios Haji-Ioannou, easyHotel is the
owner, developer, operator and franchisor of branded hotels. Its
strategy is to target the super budget segment of the hotel
industry by offering great value and "clean, comfortable and safe"
hotel rooms to its customers. easyHotel's 13 owned hotels currently
comprise 1,427 rooms, and it has a further 27 franchised hotels
with 2,332 rooms. easyHotel's committed development pipeline of
owned and franchised hotels currently consists of nine owned hotels
and seven franchised hotels.
On 20 February 2020 the Company announced the acquisition of a
freehold site in Madrid, Spain, where it plans to develop a
230-bedroom easyHotel. The premises will be easyHotel's second
owned hotel in Spain. The Company has significantly increased its
focus on Europe, where the Directors believe the opportunity to
develop the portfolio in key cities is significant. The Group's
European development team has been pursuing a number of owned and
franchised development opportunities in key primary tourist
destinations with an initial focus on France and Spain.
Citrus Holdco, a company owned by a consortium comprising ICAMAP
Investments S.à.r.l and Cadim Fonds Inc (part of Ivanhoé
Cambridge), through its Offer for the ordinary share capital of the
Company at a price of 95.0 pence per Ordinary Share that closed on
1 October 2019, acquired approximately 68.8 per cent. of the
Existing Ordinary Shares. At the time of its Offer, Citrus Holdco
shared the Company's strategy and acknowledged at the time of its
Offer that significant investment is required to achieve this
strategy and to ensure the Group can fulfil its potential as a
leading European budget hotel company.
In order to continue with its strategy the Directors have
identified the Company's need for additional capital to fund the
growth in the number of owned and franchised hotels. Citrus Holdco
has agreed to subscribe approximately GBP11.0 million of new equity
pursuant to the Subscription at a price of 95.0 pence per
Subscription Share, the same price Citrus Holdco offered
Shareholders pursuant to its Offer, to support the growth
strategy.
3. Use of Proceeds
The proceeds of the Subscription will be primarily utilised to
fund the Group's owned hotel roll-out strategy.
4. Details of the Subscription
Under the terms of the Subscription, Citrus Holdco has
subscribed for 11,578,948 Subscription Shares at the Subscription
Price by way of a conditional, non-pre-emptive subscription. The
Subscription Price of 95.0 pence per Subscription Share represents
a premium of approximately 35.7 per cent. to the closing mid-market
price of 70 pence on 5 March 2020, being the latest practicable
date prior to publication of this Announcement. The Subscription
Shares will represent approximately 7.3 per cent. of the Enlarged
Issued Share Capital following Admission. The Subscription Shares
will be issued credited as fully paid and will be identical to and
rank pari passu in all respects with the Existing Ordinary Shares,
including the right to receive all future distributions, declared,
paid or made in respect of the Ordinary Shares following the date
of Admission.
The Board believes that raising equity finance using the
flexibility provided by a non-pre-emptive subscription is the most
appropriate and optimal structure for the Company at this time.
Application will be made to the London Stock Exchange for the
Subscription Shares to be admitted to trading on AIM. It is
expected that admission to AIM will become effective in respect of,
and that dealings on AIM will commence in, the Subscription Shares,
on 26 March 2020.
The Subscription is conditional on, among other things, the
Resolutions being duly passed by Shareholders of the Company at the
General Meeting to be held in the Courtyard Meeting Room, Somerset
House, The Strand, London WC2R 1LA at 10.00 a.m. on 25 March
2020.
Following Admission, the Company will have 157,533,494 Ordinary
Shares in issue.
The Subscription Shares are not being made available to the
public and are not being offered or sold in any jurisdiction where
it would be unlawful to do so.
5. Related Party Transaction
The Subscription by Citrus Holdco for 11,578,948 Subscription
Shares constitutes a related party transaction under the AIM Rules
for Companies by virtue of Citrus Holdco being a substantial
shareholder in the Company. The Directors (excluding Cadim Fonds
Inc and Messrs Meijer and Persello who, as a result their
connection to Citrus Holdco and its shareholders, are for these
purposes deemed as not being independent of Citrus Holdco)
consider, having consulted with Investec, the Company's nominated
adviser, that the terms of the transaction are fair and reasonable
in so far as Shareholders are concerned.
6. General Meeting
The Company has no on-going authority to allot Ordinary Shares.
In order to be able to issue and allot the Subscription Shares, the
Company will seek Shareholder approval at a General Meeting to
issue such shares on a non-pre-emptive basis. The Resolutions being
proposed are specifically tailored to authorise the issue of the
11,578,948 Subscription Shares proposed to be issued pursuant to
the Subscription.
A General Meeting of the Company, notice of which will be set
out at the end of the Circular and at which the Resolutions will be
proposed, is to be held in the Courtyard Meeting Room, Somerset
House, The Strand, London WC2R 1LA on 25 March 2020 at 10.00 a.m.
Please note that the summary and explanation set out below is not
the full text of the Resolutions and Shareholders should review the
full text of the Resolutions set out in the Notice of General
Meeting before returning their proxy votes.
The business to be considered at the General Meeting is set out
in the Notice of General Meeting together with the explanatory
notes to each resolution below.
The Company is proposing that the Shareholders pass the
Resolutions in order to:
(1) grant authority to the Directors under section 551 of the
Act, to allot new Ordinary Shares up to a maximum aggregate nominal
amount of GBP115,789.48 being the amount required for the purposes
of issuing the Subscription Shares; and
(2) empower the Directors, pursuant to section 570 of the Act,
to allot the Subscription Shares on a non-pre-emptive basis.
These authorities will enable the Directors to effect the
Subscription but will expire if Admission does not take place by
the Long-Stop Date.
7. Irrevocable undertakings and Recommendation
Citrus Holdco, the Company's largest shareholder which is
interested in 100,483,906 Ordinary Shares, representing
approximately 68.8 per cent. of the Existing Ordinary Shares, has
irrevocably undertaken to vote in favour of the Resolutions in
respect of its entire shareholding.
easyGroup Holdings Limited, the Company's second largest
shareholder which is interested in 36,870,784 Ordinary Shares,
representing approximately 25.3 per cent. of the Existing Ordinary
Shares, has irrevocably undertaken to vote in favour of the
Resolutions in respect of its entire shareholding.
The Directors consider the Subscription and the associated
Resolutions to be in the best interests of the Company and its
Shareholders as a whole and accordingly unanimously recommend that
Shareholders vote in favour of the Resolutions to be proposed at
the General Meeting.
Expected timetable of principal events
Anticipated date of posting the Circular 6 March 2020
Last time and date for receipt of Forms 10.00 a.m. on 23
of Proxy and CREST Proxy Instructions March 2020
General Meeting 10.00 a.m. on 25
March 2020
Admission and dealings in the Subscription 8.00 a.m. on 26 March
Shares expected to commence on AIM 2020
Definitions
The following definitions apply throughout this Announcement
unless the context otherwise requires:
"Act" the Companies Act 2006 (as amended)
"Admission" the admission of the Subscription Shares to
trading on AIM becoming effective in accordance
with rule 6 of the AIM Rules expected on 26
March 2020
"AIM" the AIM market of the London Stock Exchange
"AIM Rules" the London Stock Exchange's rules for companies
relating to AIM titled "AIM Rules for Companies"
"Circular" the circular containing the Notice of General
Meeting which it is anticipated will be sent
to Shareholders later today convening the
General Meeting
"Citrus Holdco" Citrus Holdco Limited (formerly named Citrus
UK Bidco Limited)
"Company" easyHotel plc
"CREST" the electronic systems for the holding and
transfer of shares in dematerialised form
operated by Euroclear UK & Ireland Limited
"Directors" or "the the directors of the Company
Board"
"Enlarged Issued the issued ordinary share capital of the Company
Share Capital" as enlarged by the issue of the Subscription
Shares
"Existing Ordinary the Ordinary Shares in issue at the date of
Shares" this Announcement
"Form of Proxy" the form of proxy for use in relation to the
General Meeting which can be obtained in accordance
with the notes accompanying the Notice of
General Meeting
"General Meeting" the general meeting of the Company to be held
in the Courtyard Meeting Room, Somerset House,
The Strand, London WC2R 1LA, on 25 March 2020
at 10.00 a.m.
"Group" the group of which the Company and its subsidiary
undertakings are members
"Investec" Investec Bank plc, Nominated Adviser and Broker
to the Company
"London Stock Exchange" London Stock Exchange plc
"Long-Stop Date" 9 April 2020
"Notice of General the notice convening the General Meeting which
Meeting" will be set out at the end of the Circular
"Offer" the offer by Citrus Holdco for the ordinary
share capital of the Company
"Ordinary Shares" the ordinary shares of 1 pence each in the
capital of the Company
"Resolutions" the resolutions proposed to be passed at the
General Meeting as set out in the Notice of
General Meeting
"Shareholder" a holder of Ordinary Shares
"Subscription" the conditional, non-pre-emptive subscription
by Citrus Holdco for the Subscription Shares
at the Subscription Price pursuant to the
Subscription Letter
"Subscription Letter" the conditional letter agreement dated 6 March
2020 between the Company and Citrus Holdco
in connection with the Subscription
"Subscription Price" 95.0 pence per Subscription Share
"Subscription Shares" 11,578,948 new Ordinary Shares to be conditionally
subscribed for cash pursuant to the Subscription
Letter and whose allotment and issue is conditional,
inter alia, on the passing of the Resolutions
at the General Meeting
"United States" The United States of America, its territories
and possessions, any State of the United States
and the District of Columbia
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
END
IOEJAMLTMTMMBIM
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March 06, 2020 02:00 ET (07:00 GMT)
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