TIDMSIM
RNS Number : 5171Y
SimiGon Limited
14 January 2022
Friday, January 14, 2022
NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION IN WHOLE OR IN PART
IN OR INTO ANY JURISDICTION IN WHICH SUCH RELEASE, PUBLICATION OR
DISTRIBUTION WOULD BE UNLAWFUL.
THIS ANNOUNCEMENT IS FOR INFORMATION PURPOSES ONLY AND IS NOT AN
OFFER OF SECURITIES IN ANY JURISDICTION IN WHICH SUCH OFFER,
SOLICITATION OR SALE WOULD BE UNLAWFUL UNDER THE SECURITIES LAWS OF
ANY SUCH JURISDICTION.
SimiGon Ltd
("SimiGon" or the "Company")
Merger Proposal, Delisting and Notice of Special General Meeting
of Shareholders
SimiGon (LON:SIM) a global leader in modelling, simulation &
training solutions, is excited to announce that following months of
negotiations, the Company has today entered into a definitive
agreement to merge with Power Breezer Sub Ltd and Maxify Solutions
Inc. ("Maxify") (the "Merger" and the "Merger Agreement"). The
consideration for the Merger attributes a valuation to the Company
of $8.5 million.
Assuming shareholder approval of the resolutions at the Special
General Meeting of Shareholders (as further described below) and
completion of the Merger, it is proposed that the Company will
cancel its admission to trading on AIM of its shares.
Background of the Merger
In the past several years, SimiGon has focused on developing its
strategies of growing its market share and enhancing its products
and services portfolio. However, the Company's Board of Directors
("Directors") has periodically reviewed a variety of business
strategies, including possible business combinations, with the
Company's senior management and in certain circumstances also with
external advisors. These reviews took account of the Company's
financial performance and market, economic, competitive, and other
conditions. During these discussions, the Directors and management
have also noted the challenges of continuing on the path as an
independent public company, operating in both a highly competitive
and consolidating market.
SimiGon's management has been working on expanding the Company's
offering to domains that are beyond its existing markets. Initial
discussions with Breezer Holdings LLC ("Breezer") led to
identifying multiple synergies between SimiGon's technology and the
needs, the Company believes exists, in the Simulation Based Design
of fulfilment and distribution centres. As Breezer already has a
foothold in this domain, SimiGon and Breezer started discussions
about a potential transaction and have been structuring the
transaction and negotiating its terms for several months.
About Maxify
Maxify is a newly-formed Delaware corporation that, prior to the
effective time of the Merger, shall acquire all the assets and
activities of Breezer. Breezer is a provider of intelligent
atomized water-cooling systems in the United States. Breezer's
products cool where almost no other solution cost effectively can.
Breezer's autonomous and green cooling solutions can help customers
reduce the costs associated with keeping their employees cool
during the heat of summer; accelerate throughput; increase quality;
reduce employee turnover; reduce safety incidents; and comply with
Occupational Health and Safety Administration workplace safety
standards.
SimiGon Integration with Maxify
SimiGon's integration with Maxify is expected to enhance
Breezer's capabilities in the e-commerce logistics space. Following
the Merger, Maxify will combine the strengths of both Power Breezer
and SimiGon's advanced technology to address the gaps of modern
fulfilment centres in their integration of cutting-edge solutions
from multiple automation suppliers. A True-to-life simulation is
imperative for any mission critical design to come to life on time
and on budget. However, with each equipment vendor owning its own
proprietary simulation software, a best of breed equipment
mix-and-match as well as true-to-life simulation have been beyond
reach. SimiGon's product, SIMbox, being a true-to-life simulation
design platform utilizing artificial intelligence, high fidelity
physics, and augmented reality is uniquely positioned to close this
gap. The Power Breezer Sky ("Sky") can benefit from complex
software integration of the licensed AI, with the Sky's sensors and
the creation of a customer graphical user interface. The Sky's
sensor can provide customers with real-time and actionable data
assisting its customers with managing their shipping dock related
assets.
The Merger
In summary, the Merger is structured as the acquisition of both
SimiGon and Breezer by a newly incorporated company, Maxify.
Pursuant to the Merger Agreement and upon completion and subject
to customary closing conditions of the Merger Agreement, the
Company will merge with Power Breezer Sub Ltd., a wholly-owned
subsidiary of Maxify, following which the Company will become a
wholly owned subsidiary of Maxify and the shareholders of the
Company will receive shares in Maxify.
Merger Consideration:
The shareholders of SimiGon will receive shares of Common Stock
of Maxify on the basis of a fully-diluted valuation of the Company
of $8,500,000 against a fully-diluted pre-Merger valuation of
Maxify of $135,000,000. The Merger Agreement provides that the
relative valuation of SimiGon may be upwardly adjusted to
$11,000,000 depending on certain circumstances specified in the
Merger Agreement
The consideration per share to shareholders of SimiGon ("Merger
Consideration") is expected to be $0.165 per share (before any
upward adjustment in the relative valuation of SimiGon), that
represents a premium of 226.86% to the average closing price on the
AIM Market for the last 12 months, a premium of 250.66% to the
average closing price on the AIM Market for the last 6 months, a
premium of 285.54% to the closing price on the AIM Market on the
last full trading day immediately preceding the public announcement
of the Merger and a premium of 285.54% to the closing price on the
AIM Market on Thursday, 13 January 2022 (being the most recent
practicable date prior to the date of this announcement).
SimiGon engaged BDO Ziv Haft Consultation and Management Ltd.
("BDO") to provide the "Directors with a fairness opinion study on
Breezer in order to determine its intrinsic value which was to the
effect that, as of 15 December 2021 and based upon and subject to
the various assumptions made, procedures followed, matters
considered and limitations on the scope of the review undertaken as
set forth therein, the valuation of Breezer exceeds $135
million.
BDO's opinion sets forth, among other things, the assumptions
made, procedures followed, matters considered and limitations on
the scope of the review undertaken by BDO in rendering its opinion.
BDO's opinion was directed to the Directors and addresses only the
valuation of Breezer as of the date of the opinion. It does not
address any other aspects of the Merger and does not constitute a
recommendation as to how any holder of Ordinary Shares should vote
on the Merger or any matter related thereto. Further details of the
BDO opinion are included in the notice of the Special General
Meeting of Shareholders of the Company (as specified below).
The Delisting
The Directors has for some time been reviewing the merits or
otherwise of the Ordinary Shares continuing to be admitted to
trading on the AIM Market and remaining a public traded company in
the UK.
SimiGon's shareholders currently effectively only have very
limited liquidity on the AIM Market and the Directors does not
perceive that this will change in the foreseeable future.
Following completion of the Merger, SimiGon's shareholders will
hold shares in Maxify which will be a private company with no
liquidity in its shares (other than the possibility of making a
private sale to other stakeholders or prospective purchasers). The
Directors believe that it is not feasible for SimiGon to put a
formal post-Merger liquidity scheme in place for its shareholders;
however, it is Maxify's intention to provide shareholders liquidity
by consummating an initial public offering and listing of its
shares on NASDAQ (the "IPO") as soon as practicable following the
Merger.
The Directors have been informed by Maxify that it is at a
fairly advanced stage in its preparation of a registration
statement for this purpose. Although there can be no assurance as
to the success, valuation or timing of Maxify's IPO, the Directors
believe that this has a greater chance of providing liquidity, and
if successful, increasing shareholder value for SimiGon's
shareholders than remaining on the AIM Market and other readily
available alternatives for SimiGon.
The following key factors have been taken into account by the
Directors in reaching the conclusion that the cancellation of the
admission of the Ordinary Shares to trading on the AIM Market (the
"Delisting") is in the best interests of the Company and its
shareholders as a whole:
-- Subject to the consummation of the Merger, the Delisting is
required to execute Maxify's contemplated IPO and listing on Nasdaq
which, if successful, is expected to increase shareholder value;
and
-- The current ability for institutional and other investors to
trade in SimiGon's shares on the AIM Market is relatively low and
they consequently suffer from a lack of liquidity. Delisting from
the AIM in favour of Maxify's contemplated IPO , is expected to
provide liquidity; and
-- SimiGon shareholders are cautioned that the Delisting will
significantly reduce the liquidity of their shares pending the
potential listing on Nasdaq. There will be no trading facility put
in place to enable shareholders to trade their shares following the
Delisting and there can be no assurance that the listing on Nasdaq
will be consummated or will be successful.
Following the effective date of the Delisting, the Company will
no longer be subject to the AIM Rules for Companies, in particular
with regard to the notification of material events or results, or
be required to retain the services of an independent nominated
adviser. The Company will also no longer be subject to the
corporate governance standards expected of a publicly listed
company, or be required to comply with the continuing obligations
set out in the FCA's Disclosure Guidance and Transparency Rules
("DTRs") or, provided the Company's securities remain outside the
scope of the regulation, the EU Market Abuse Regulation
("MAR").
The Delisting will not proceed should the Merger not
complete.
Recommendation by the SimiGon Board of Directors
The Directors believe that the Merger, the Merger Agreement, and
the other transactions contemplated by the Merger Agreement
("Merger Proposal") is fair to and in the best interests of SimiGon
and its shareholders and unanimously recommends that you and the
other SimiGon shareholders vote "FOR" the merger proposal and the
delisting of the shares from the AIM market subject to the
consummation of the merger. See "Our reasons for approving the
merger" in the Notice to Shareholders.
Shareholders should not send any certificates representing
ordinary shares with their proxy cards. If the Merger Proposal is
approved and the Merger is subsequently completed, you will receive
instructions for surrendering your certificates or electronic
evidence of ownership in exchange for the Merger Consideration.
Shareholders are urged to vote, no matter how large or small
your holdings may be.
Notice of Special General Meeting of Shareholders:
Shareholder approval is required to approve the Merger Agreement
including all other transactions and arrangements contemplated by
the Merger Agreement as well as the proposed Delisting (the
"Resolutions").
The Special General Meeting of Shareholders of the Company is to
be held at SimiGon's United States offices at 111 S. Maitland
Avenue, Suite 210, Maitland, Florida 32751, USA, on Friday,
February 18, 2022, commencing at 9.00 a.m. Eastern Standard Time
(2.00 p.m. UK time), 4.00 pm Israel Time and thereafter as it may
be adjourned from time to time (the "Meeting").
The Notice of the Meeting and related materials is being
distributed to shareholders from today and this process is expected
to be completed by January 19, 2022. An electronic copy will be
made available from today on the Company's website:
https://www.simigon.com/gm . The record date for the Meeting shall
be Thursday, January 20, 2022.
Shareholders who cannot join the Meeting in person can join via
conference call using the dial-in details as detailed on the
Company's website: https://www.simigon.com/ gm.
The Notice also includes certain other important disclosures,
including: (but not limited to): important risk factors with regard
to the Merger, that a termination fee of $1.25m may be payable
should the Merger be terminated by SimiGon in favour of a competing
proposal, and the effect that the Merger will have on share options
held by directors, senior officers and executives of the Company
including that certain existing share options held by an executive
who is not a director will be exercised in accordance with their
terms subsequent to the completion of the Merger. Shareholders are
urged to read the Notice carefully.
Summary of anticipated timetable of events
Below is a summary of the anticipated timetable (all times in
London time) regarding the Meeting, the completion of the Merger
and the Delisting ([1]) :
Date Event
Friday, January 14, Notification to SimiGon's shareholders of the
2022 Meeting to approve the Merger and the Delisting.
---------------------------------------------------------
Thursday, January Record date for shareholders to vote at the Meeting.
20, 2022 ([2])
---------------------------------------------------------
Friday, February Meeting date. ([3])
18, 2022
---------------------------------------------------------
Friday, February Notification of the results of the Meeting.
18, 2022
---------------------------------------------------------
Friday, March 18, Last time for dealings in SimiGon shares
2022
---------------------------------------------------------
7:30am on Monday, Trading in the Company's shares will be suspended
March 21, 2022 pending effectiveness of the Merger and disablement
in CREST
---------------------------------------------------------
During the course The Merger becomes effective upon, and subject
of to, issuance of the merger certificate in accordance
Monday, March 21, with the Israeli Companies Law. ([4])
2022
---------------------------------------------------------
6:00pm on Monday, The Depositary Interests (DIs) will be cancelled,
March 21, 2022 and all DI holders will be registered as shareholders
on SimiGon's share register. Settlement of transactions
concluded prior to this date will be performed
until close of business on this date.
Record date for entitlement to Merger Consideration.
---------------------------------------------------------
7:00am on Thursday, Cancellation of admission to trading on AIM
March 22, 2022
---------------------------------------------------------
If any of the above dates change, the revised dates will be
notified to Shareholders through a Regulatory Information Service
announcement with the dates following the Meeting being dependent
on the Shareholders passing the resolutions being proposed at the
Meeting.
Voting agreements from Certain Supporting Shareholders
The Company has received voting agreements from certain
supporting shareholders to vote in favour of the Resolutions in
respect of, in aggregate, 17,908,528 Ordinary Shares representing
approximately 34.84% of the Company's issued share capital as at
the date of this announcement.
Mr. Ami Vizer, SimiGon's Chief Executive Officer and Executive
Chairman, said: "This Merger is an achievement for the Company and
its shareholders. The Merger presents a compelling opportunity to
achieve superior shareholder value and liquidity than SimiGon
currently believes is possible as an independent company listed on
AIM.
SimiGon's software technology capabilities are expected to be
leveraged to an additional new domain with significant market
potential that far exceeds our current target markets. Along with
our current primary market of aviation-focused training and
simulation, Maxify's adoption of SimiGon technologies will lead to
the fully maximized value and capabilities of our software for the
benefit of the Company and its shareholders.
SimiGon helped revolutionize the defence training and simulation
market and I am immensely proud of all our accomplishments as the
market has fully embraced our vision.
I would like to thank everyone who took part in this Merger
Agreement for the continued great work through this period. We look
forward to completing this Merger that will ultimately make us
significantly stronger to better meet the expanded market
demands."
Capitalised terms in this announcement, unless otherwise
defined, have the same meaning as will be set out in the
Notice.
Enquiries:
SimiGon Ltd
Ami Vizer, Chief Executive Officer and Executive Tel: +1 (407) 951
Chairman 5548
Efi Manea, Chief Financial Officer www.simigon.com
finnCap (NOMAD & Broker)
Henrik Persson / Milesh Hindocha (corporate Tel: +44 (0) 20 7220
finance) 0500
[1] The above dates are subject to change, primarily if the
closing conditions in accordance with the Merger Agreement cannot
be fulfilled by the specified date.
[2] Not more than 40 days and not less than 28 days before the Meeting.
[3] At least 35 days' notice required in accordance with the Israeli Companies Law.
[4] The Israeli Companies Law requires at least 30 days
following approval of the Merger at the Meeting before the
effective date of the Merger.
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END
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