Redefine Properties Limited (“Redefine” or the “Issuer”) announces the launch of an offering of senior, secured exchangeable bonds due 2021 (the “Bonds”) with a principal amount of EUR 150 million, exchangeable into ordinary shares (the “Shares”) of Redefine International P.L.C. (the “Company”).
The Bonds will be marketed with a coupon range of 1.25 – 1.75%, payable semi-annually in arrear. The initial exchange price of the Bonds is expected to be set within a premium range of 22.5 – 30.0% to a reference price (the “Reference Price”) determined as the euro-equivalent of the arithmetic average of the daily volume weighted average prices of a Share listed on the London Stock Exchange plc (the “LSE”) on each of the five scheduled trading days commencing on (and including) the date hereof, such Reference Price being subject to a floor of EUR 0.45673 and a cap of EUR 0.51902. The Bonds will be issued at 100% of their principal amount and, unless previously exchanged, redeemed, or repurchased and cancelled, will be redeemed at par (subject to the Issuer’s settlement option referred to below) on 16 September 2021. Holders of the Bonds will have the option to require an early redemption of their Bonds on the third anniversary of the issue date, at their principal amount, together with accrued interest.
Upon exchange the Issuer will have the flexibility to settle in cash, deliver the underlying Shares or any combination thereof.
The Issuer will have the option to redeem any outstanding Bonds at their principal amount together with accrued interest under certain customary conditions, as further described in the terms and conditions of the Bonds (the “Terms and Conditions”). The Issuer will also, at maturity or upon early redemption, have the option to deliver a combination of Exchange Property, in whole or in part, and cash, subject to customary conditions described in the Terms and Conditions.
The Issuer's obligations in respect of the Bonds will be secured under English law by, inter alia, a first fixed charge over the pledged property (which shall initially include such number of underlying Shares as is determined at final pricing (the “Exchange Property”)) and the Stock Lending Agreements entered into by the Chargors (each as defined below), pursuant to the Security agreements between Redefine Retail (Pty) Ltd, Madison Property Fund Managers Holdings Limited, Madison Property Fund Managers Limited and Redefine Global (Pty) Ltd (the “Chargors”) and the Trustee. Any adjustment to the Exchange Property, including in respect of cash dividends, shall trigger a corresponding adjustment to the pledged property.
The Bonds are expected to be rated by Moody’s. The Bonds will be rated after the Settlement Date.
In the context of the transaction, the Issuer and its subsidiaries will be subject to a lock-up undertaking in relation to the Shares for a period ending 90 days after the Settlement Date (as defined below), subject to customary exceptions.
Certain final terms of the Bonds are expected to be determined and announced today and settlement is expected on or around 16 September 2016 (the “Settlement Date”). Application will be made to admit the Bonds to trading on the Open Market (Freiverkehr) of the Frankfurt Stock Exchange by no later than 90 days following the Settlement Date.
The Issuer will use the proceeds of the issuance of the Bonds to refinance debt, provided by the Sole Bookrunner and associated entities, incurred in the acquisition of a majority interest in Echo Prime Properties B.V.
J.P. Morgan Securities plc is acting as Sole Bookrunner on this transaction.
J.P. Morgan Securities plc, the Issuer and the Chargors will enter into stock lending agreements (the “Stock Lending Agreements”) on or around the date hereof in respect of Shares representing approximately 10 per cent. of the Company’s issued share capital for the purposes of facilitating investors’ hedging activities.
For more information, please contact:
Redefine Properties Limited:
2 Arnold Road
Telephone: +27 11 283 0032
Attention: Leon Kok
5th September 2016
Company sponsor: Java Capital
NO ACTION HAS BEEN TAKEN BY THE ISSUER, THE COMPANY, THE SOLE BOOKRUNNER OR ANY OF THEIR RESPECTIVE AFFILIATES THAT WOULD PERMIT AN OFFERING OF THE BONDS OR POSSESSION OR DISTRIBUTION OF THIS PRESS RELEASE OR ANY OFFERING OR PUBLICITY MATERIAL RELATING TO THE BONDS IN ANY JURISDICTION WHERE ACTION FOR THAT PURPOSE IS REQUIRED. PERSONS INTO WHOSE POSSESSION THIS PRESS RELEASE COMES ARE REQUIRED BY THE ISSUER, THE COMPANY AND THE SOLE BOOKRUNNER TO INFORM THEMSELVES ABOUT, AND TO OBSERVE, ANY SUCH RESTRICTIONS.
THIS PRESS RELEASE IS NOT FOR DISTRIBUTION, DIRECTLY OR INDIRECTLY IN OR INTO THE UNITED STATES OR TO U.S. PERSONS (AS DEFINED IN REGULATION S UNDER THE SECURITIES ACT). THIS PRESS RELEASE IS NOT AN OFFER TO SELL SECURITIES OR THE SOLICITATION OF ANY OFFER TO BUY SECURITIES, NOR SHALL THERE BE ANY OFFER OF SECURITIES IN ANY JURISDICTION IN WHICH SUCH OFFER OR SALE WOULD BE UNLAWFUL.
THE BONDS MAY BE DEEMED TO BE THE SECURITIES OF A “COVERED FUND” FOR THE PURPOSES OF THE VOLCKER RULE.THE ISSUER IS NOT REGISTERED UNDER THE UNITED STATES INVESTMENT COMPANY ACT OF 1940 AND INVESTORS WILL NOT HAVE THE BENEFIT OF THAT ACT.
THIS PRESS RELEASE AND THE OFFERING WHEN MADE ARE ONLY ADDRESSED TO, AND
DIRECTED IN MEMBER STATES OF THE EUROPEAN ECONOMIC AREA (THE “EEA”) AT PERSONS WHO ARE “QUALIFIED INVESTORS” WITHIN THE MEANING OF ARTICLE 2(1)(E) OF THE PROSPECTUS DIRECTIVE (“QUALIFIED INVESTORS”). FOR THESE PURPOSES, THE EXPRESSION "PROSPECTUS DIRECTIVE" MEANS DIRECTIVE 2003/71/EC, AS AMENDED. IN ADDITION, IN THE UNITED KINGDOM THIS PRESS RELEASE IS BEING DISTRIBUTED ONLY TO, AND IS DIRECTED ONLY AT, QUALIFIED INVESTORS (I) WHO HAVE PROFESSIONAL EXPERIENCE IN MATTERS RELATING TO INVESTMENTS FALLING WITHIN ARTICLE 19(5) OF; THE FINANCIAL
SERVICES AND MARKETS ACT 2000 (FINANCIAL PROMOTION) ORDER 2005, AS AMENDED (THE
“ORDER”) AND QUALIFIED INVESTORS FALLING WITHIN ARTICLE 49(2)(A) TO (D) OF THE ORDER, AND (II) TO WHOM IT MAY OTHERWISE LAWFULLY BE COMMUNICATED (ALL SUCH PERSONS TOGETHER BEING REFERRED TO AS “RELEVANT PERSONS”). THIS PRESS RELEASE MUST NOT BE ACTED ON OR RELIED ON (I) IN THE UNITED KINGDOM, BY PERSONS WHO ARE NOT RELEVANT PERSONS, AND (II) IN ANY MEMBER STATE OF THE EEA OTHER THAN THE UNITED KINGDOM, BY PERSONS WHO ARE NOT QUALIFIED INVESTORS. ANY INVESTMENT OR INVESTMENT ACTIVITY TO WHICH THIS PRESS RELEASE RELATES IS AVAILABLE ONLY TO (A) RELEVANT PERSONS IN THE UNITED KINGDOM AND WILL BE ENGAGED IN ONLY WITH RELEVANT PERSONS IN THE UNITED KINGDOM AND (B) QUALIFIED INVESTORS IN MEMBER STATES OF THE EEA (OTHER THAN THE UNITED KINGDOM).
THIS DOCUMENT IS NOT AN OFFER TO SELL SECURITIES OR THE SOLICITATION OF ANY OFFER TO SUBSCRIBE FOR OR BUY SECURITIES, AND NO SECURITIES WILL BE SOLD, WITHIN SOUTH AFRICA OR TO OR BY ANY PERSON RESIDENT IN OR WITHIN SOUTH AFRICA.
ANY DECISION TO PURCHASE ANY OF THE BONDS SHOULD ONLY BE MADE ON THE BASIS OF AN INDEPENDENT REVIEW BY A PROSPECTIVE INVESTOR OF THE ISSUER’S AND THE
COMPANY’S PUBLICLY AVAILABLE INFORMATION. NEITHER THE SOLE BOOKRUNNER NOR ANY OF ITS AFFILIATES ACCEPT ANY LIABILITY ARISING FROM THE USE OF, OR MAKE ANY
REPRESENTATION AS TO THE ACCURACY OR COMPLETENESS OF, THIS PRESS RELEASE OR THE ISSUER’S AND THE COMPANY’S PUBLICLY AVAILABLE INFORMATION. THE INFORMATION CONTAINED IN THIS PRESS RELEASE IS SUBJECT TO CHANGE IN ITS ENTIRETY WITHOUT NOTICE UP TO THE SETTLEMENT DATE.
EACH PROSPECTIVE INVESTOR SHOULD PROCEED ON THE ASSUMPTION THAT IT MUST BEAR THE ECONOMIC RISK OF AN INVESTMENT IN THE BONDS OR THE SHARES TO BE ISSUED OR TRANSFERRED AND DELIVERED UPON EXCHANGE OF THE BONDS AND NOTIONALLY UNDERLYING THE BONDS (TOGETHER WITH THE BONDS, THE “SECURITIES”). NONE OF THE ISSUER, THE COMPANY OR THE SOLE BOOKRUNNER MAKE ANY REPRESENTATION AS TO (I) THE SUITABILITY OF THE SECURITIES FOR ANY PARTICULAR INVESTOR, (II) THE APPROPRIATE ACCOUNTING TREATMENT AND POTENTIAL TAX CONSEQUENCES OF INVESTING IN THE SECURITIES OR (III) THE FUTURE PERFORMANCE OF THE SECURITIES EITHER IN ABSOLUTE TERMS OR RELATIVE TO COMPETING INVESTMENTS.
THE SOLE BOOKRUNNER IS ACTING ON BEHALF OF THE ISSUER AND NO ONE ELSE IN
CONNECTION WITH THE BONDS AND WILL NOT BE RESPONSIBLE TO ANY OTHER PERSON FOR PROVIDING THE PROTECTIONS AFFORDED TO CLIENTS OF THE SOLE BOOKRUNNER OR FOR PROVIDING ADVICE IN RELATION TO THE SECURITIES.
EACH OF THE ISSUER, THE COMPANY, THE SOLE BOOKRUNNER AND THEIR RESPECTIVE
AFFILIATES EXPRESSLY DISCLAIM ANY OBLIGATION OR UNDERTAKING TO UPDATE, REVIEW OR REVISE ANY STATEMENT CONTAINED IN THIS PRESS RELEASE WHETHER AS A RESULT OF NEW INFORMATION, FUTURE DEVELOPMENTS OR OTHERWISE.