TIDMAAL TIDMSXX
RNS Number : 2420A
Anglo American PLC
20 January 2020
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 OF SUCH
JURISDICTION
THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION
FOR IMMEDIATE RELEASE
20 January 2020
RECOMMED CASH ACQUISITION
for
SIRIUS MINERALS PLC
by
ANGLO AMERICAN PROJECTS UK LIMITED
(a wholly owned subsidiary of Anglo American plc)
Summary
-- The boards of Anglo American plc ("Anglo American"), Anglo
American Projects UK Limited ("Bidco") and Sirius Minerals Plc
("Sirius") are pleased to announce that they have reached agreement
on the terms of a recommended cash acquisition pursuant to which
Bidco shall acquire the entire issued and to be issued share
capital of Sirius (the "Acquisition"). The Acquisition is intended
to be effected by means of a scheme of arrangement under Part 26 of
the Companies Act.
-- Under the terms of the Acquisition, Sirius Shareholders shall be entitled to receive:
for each Sirius Share 5.50 pence in cash
-- The Offer Price represents a premium of approximately:
-- 34.1 per cent. to the Closing Price of 4.10 pence per Sirius
Share on 7 January 2020 (being the last Business Day prior to the
commencement of the Offer Period);
-- 46.5 per cent. to the volume-weighted average price of 3.75
pence per Sirius Share since Sirius' 17 September 2019 strategic
review announcement to 7 January 2020 (being the last Business Day
prior to the commencement of the Offer Period);
-- 53.4 per cent. to the one-month volume-weighted average price
of 3.59 pence per Sirius Share to 7 January 2020 (being the last
Business Day prior to the commencement of the Offer Period);
and
-- 61.7 per cent. to the three-month volume-weighted average
price of 3.40 pence per Sirius Share to 7 January 2020 (being the
last Business Day prior to the commencement of the Offer
Period).
-- The Acquisition values the entire issued and to be issued
share capital of Sirius at approximately GBP404.9 million.
-- If, on or after the date of this announcement and on or prior
to the Effective Date, any dividend, distribution or other return
of value is declared, made or paid by Sirius on the Sirius Shares,
the Offer Price shall be reduced correspondingly. In such
circumstances, Sirius Shareholders would be entitled to retain any
such dividend, distribution or other return of value declared, made
or paid.
-- In September 2019, Sirius announced that it was undertaking a
strategic review in order to assess the development plan for its
North Yorkshire polyhalite project (the "Project") and an
appropriate financing structure to provide relevant funding. Sirius
also announced that the strategic review would include a broader
process to seek a major strategic partner in the Project. In
November 2019, Sirius provided an update on the progress of this
strategic review, including a revised two-stage development
plan.
-- Anglo American identified the Project as being of potential
interest some time ago, given the quality of the underlying asset
in terms of scale, resource life, operating cost profile and the
nature and quality of its product. The Project has the potential to
fit well with Anglo American's established strategy of focusing on
world-class assets, particularly in the context of Anglo American's
portfolio trajectory towards later cycle products that support a
fast-growing global population and a cleaner, greener, more
sustainable world. The key elements underlying the rationale
include:
-- Asset quality: Anglo American believes that the Project has
the potential to become a world-class, low-cost and long-life
asset. Sirius has progressed the development of the Project to an
advanced stage, with construction now under way for over two years.
Sirius has indicated that this is currently the world's largest
known high-grade polyhalite deposit with a JORC Reserve of 290
million tonnes, with a grade of 88.8%, and a Resource of 2.69
billion tonnes. The Resource indicated by Sirius has the scale,
thickness and quality to be mined efficiently through a relatively
simple, low-energy, non-chemical production process. Sirius has
indicated that the Project could operate at an EBITDA margin
potentially well in excess of 50% leaving the Project well
positioned for strong through-the-cycle profitability with an
anticipated long asset life.
-- Development pathway: At this stage, the Project requires a
significant amount of further financing to develop and commission
the operation that has proven challenging for Sirius to procure on
an economic basis. Anglo American, as one of the world's leading
mining companies, has the resources and capabilities to help build
on the achievements of the Sirius team. Anglo American remains
committed to its disciplined capital allocation framework. In the
first two years after successful completion of the Acquisition,
development work on the Project is expected to be broadly in line
with Sirius' revised development plan although Anglo American
intends to update the development timeline, optimise mine design
and ensure appropriate integration with its own operating standards
and practices. During this period and subject to the update,
development work of approximately US$300 million per annum is
expected. Anglo American believes that there is the potential for
long-term benefits from Anglo American's technical expertise in
both the development and operational phases, as well as from Anglo
American's recognised Operating Model to drive safety and
productivity to world-leading standards. Integration into Anglo
American's global marketing network would provide full
mine-to-market capabilities and build on Anglo American's
institutional experience in the world's major fertiliser
markets.
-- Premium product: Sirius' polyhalite product, POLY4, is a
multi-nutrient fertiliser certified for organic use and has the
potential to generate demand at a competitive cost that supports a
strong margin. POLY4 is an attractive low-chloride alternative to,
and for blending with, traditional fertiliser products on a
cost-effective basis. It includes four of the six key nutrients
that plants need to grow - potassium, sulphur, magnesium and
calcium. The use of fertilisers is one of the most effective ways
to improve agricultural yields and therefore help to address the
anticipated future imbalance between food, feed and biofuel demand
and supply caused by a fast-growing global population and limited
additional land availability for agricultural use.
Recommendation
-- The Sirius Directors, who have been so advised by J.P. Morgan
Cazenove and Lazard as to the financial terms of the Acquisition,
consider the terms of the Acquisition to be fair and reasonable. In
providing their advice to the Sirius Directors, J.P. Morgan
Cazenove and Lazard have taken into account the commercial
assessments of the Sirius Directors. In addition, the Sirius
Directors consider the terms of the Acquisition to be in the best
interests of Sirius Shareholders as a whole.
-- Accordingly, the Sirius Directors intend to recommend
unanimously that Sirius Shareholders vote in favour of the Scheme
at the Court Meeting and the resolutions to be proposed at the
General Meeting as the Sirius Directors who hold Sirius Shares have
irrevocably undertaken to do or procure to be done in respect of
their own beneficial holdings, amounting, in aggregate, to
172,462,637 Sirius Shares representing, in aggregate, approximately
2.46 per cent. of the issued share capital of Sirius as at 16
January 2020 (being the latest practicable date prior to this
announcement).
Timetable
-- It is intended that the Acquisition will be effected by means
of a scheme of arrangement of Sirius under Part 26 of the Companies
Act, further details of which are contained in the full text of
this announcement (and will be included in the Scheme Document).
Anglo American and Bidco reserve the right to implement the
Acquisition by way of a Takeover Offer, subject to the Panel's
consent and the terms of the Co-operation Agreement.
-- The Acquisition shall be put to Sirius Shareholders at the
Court Meeting and at the General Meeting. In order to become
Effective, the Scheme must be approved by a majority in number of
the Sirius Shareholders voting at the Court Meeting, either in
person or by proxy, representing at least 75 per cent. in value of
the Sirius Shares voted. In addition, a special resolution
implementing the Scheme must be passed by Sirius Shareholders
representing at least 75 per cent. of votes cast at the General
Meeting.
-- The Acquisition is subject to further conditions and terms
set out in Appendix I to this announcement, including the receipt
of the relevant clearances from the competition and regulatory
authorities.
-- Bidco and Sirius intend to work together (to the extent legally permissible) to engage constructively with relevant stakeholders.
-- It is expected that the Scheme Document, containing further
information about the Acquisition and notices of the Court Meeting
and the General Meeting, shall be sent to Sirius Shareholders
within 28 days of this announcement and it is expected that the
Scheme will become Effective by 31 March 2020.
Commenting on the Acquisition, Mark Cutifani, Chief Executive of
Anglo American, said:
"Anglo American's recommended offer provides greater certainty
for Sirius' Shareholders, employees and wider stakeholders, while
bringing the prospects for the development of this potential Tier 1
Project closer to reality. We intend to bring Anglo American's
financial, technical and product marketing resources and
capabilities to the development of the Project, which of course
would be expected to unlock a significant and sustained associated
employment and economic stimulus for the local area.
"The addition of the Project supports our ongoing transition
towards supplying those essential metals and minerals that will
meet the world's evolving needs - in terms of the undoubted need
for cleaner energy and transport, and providing infrastructure and
food for the world's fast-growing and urbanising population. Our
development of the Project in the years ahead reinforces the
quality of our portfolio and our long-term growth profile, further
enhancing our ability to deliver leading returns on a sustainable
basis and enduring value for all stakeholders."
Commenting on the Acquisition, Russell Scrimshaw, Chairman of
Sirius, said:
"Four months ago, following the setbacks in the bond market, we
took the difficult decision to slow the pace of development of our
project and initiate a strategic review to reassess how best to
unlock the long term value for our Shareholders, the community, the
UK, and our customers all around the world.
"The scope of the strategic review was to consider and
incorporate optimisations to the Project development plan and to
explore alternative funding solutions, including looking for a
strategic partner to acquire a minority interest in the Project to
provide those funds and support the senior debt financing required
to complete the Project.
"We were successful in reducing the initial funding needs of our
Project to map out a way to develop the Project in a way that
better aligned risk to capital providers but, despite an extensive
global search for a strategic investor, we have to date not
received a firm proposal for a partial Project stake. The only
viable proposal was received from Anglo American in early January,
who were only interested in pursuing a 100% control
transaction.
"Alternative financing solutions have also been pursued in
parallel to the strategic partner process, which resulted initially
in a non-binding proposal being received in December 2019 and
subsequently a revised proposal being received on 9 January 2020.
However, in the opinion of the Sirius Board and its advisers, the
terms of the proposal received and the conditions attached are not
acceptable in their current form. It is highly unlikely that
acceptable revisions to this financing proposal can be delivered
and implemented by the end of March 2020.
"We acknowledge that to many Shareholders our decision as a
board to recommend this offer will have come as a shock. Your board
deeply regrets that we could not deliver the complete stage two
financing in 2019 despite a very broad and thorough process. Going
into the strategic review the Sirius Board's strong preference was
a solution that allowed current Shareholders to participate as
fully as possible in the future development of the Project.
Following the strategic review process it is clear that no such
options are currently available to us and in that context Anglo
American's offer is the only feasible option.
"We also recognise the returns that this offer would represent
are not what either our shareholders or the Sirius Board had
previously hoped for. We regret that we are not able to deliver on
our long-term goal of Sirius being able to deliver the Project into
production, although we assure all stakeholders that the team has
worked tirelessly and diligently over the last nine years to try
and achieve that. However, given the current cash constraints of
Sirius, and lack of realistic and deliverable alternative financing
and development options, we believe this to be a fair approach from
Anglo American, a company committed to approaching the Project in
the right way, and with the resources to complete the job.
"We now face a stark choice. If the Acquisition is not approved
by Shareholders and does not complete there is a high probability
that the business could be placed into administration or
liquidation within weeks thereafter. This outcome would most likely
result in Shareholders losing all of their investment, as well as
put the future of the entire Project, and its associated benefits
for the local area and the UK, at risk.
"This is the context in which your board must assess the offer
for your company and, having given due consideration, your board
believes the Acquisition to be in the best interests of Sirius and
all of its stakeholders, providing Shareholders with some financial
return."
This summary should be read in conjunction with the full text of
this announcement. The Acquisition shall be subject to the
Conditions and further terms set out in Appendix I to this
announcement and to the full terms and conditions which shall be
set out in the Scheme Document. Appendix II to this announcement
contains the sources of information and bases of calculations of
certain information contained in this announcement, Appendix III
contains a summary of the irrevocable undertakings received in
relation to this Acquisition and Appendix IV contains definitions
of certain expressions used in this summary and in this
announcement.
Enquiries:
Anglo American
Media Investors
UK UK
James Wyatt-Tilby Paul Galloway
james.wyatt-tilby@angloamerican.com paul.galloway@angloamerican.com
Tel: +44 (0)20 7968 8759 Tel: +44 (0)20 7968 8718
Robert Greenberg
Marcelo Esquivel robert.greenberg@angloamerican.com
marcelo.esquivel@angloamerican.com Tel: +44 (0)20 7968 2124
Tel: +44 (0)20 7968 8891
Emma Waterworth
Katie Ryall emma.waterworth@angloamerican.com
katie.ryall@angloamerican.com Tel: +44 (0)20 7968 8574
Tel: +44 (0)20 7968 8935
South Africa
Pranill Ramchander
pranill.ramchander@angloamerican.com
Tel: +27 (0)11 638 2592
Sibusiso Tshabalala
sibusiso.tshabalala@angloamerican.com
Tel: +27 (0)11 638 2175
Bank of America Securities (Joint Financial Adviser to Anglo
American)
Ben Davies Tel: +44 (0) 20 7628
Geoff Iles 1000
Peter Surr
Ben Winstanley
Centerview Partners UK LLP (Joint Financial Adviser to Anglo
American)
James Hartop Tel: +44 (0) 20 7409
Edward Rowe 9700
Fiona McHardy
Brunswick (Anglo American's PR adviser)
Jonathan Glass Tel: +44 (0) 20 7404
Charles Pretzlik 5959
Sirius
Gareth Edmunds Tel: +44 (0) 8455 240
Tristan Pottas 247
J.P. Morgan Cazenove (Lead Financial
Adviser to Sirius)
Jamie Riddell Tel: +44 (0) 20 7742
James Robinson 4000
Andrey Zhvitiashvili
Jonty Edwards
Lazard & Co., Limited (Financial Adviser
to Sirius)
Spiro Youakim Tel: +44 (0) 20 7187
David Burlison 2000
Victoria Varga
Liberum Capital (Joint Broker to Sirius)
Tel: +44 (0) 20 3100
Clayton Bush 2000
Shore Capital (Joint Broker to Sirius)
Tel: +44 (0) 20 7408
Jerry Keen 4090
Edelman (Sirius' PR adviser)
Iain Dey Tel: +44 (0) 20 3047
Ed Brown 2268
John Kiely
Linklaters LLP are retained as legal adviser to Anglo American.
Allen & Overy LLP are retained as legal adviser to Sirius.
Anglo American LEI: 549300S9XF92D1X8ME43
Sirius LEI: 2138004ATVA9GVUAGA82
Shareholder helpline
If you have any questions in relation to the Acquisition please
contact Georgeson, a trading name of Computershare Investor
Services PLC, on 00 800 3742 6163 between the hours of 9.00 a.m.
and 5.00 p.m. Monday to Friday.
Please note, that for legal reasons, Georgeson will only be able
to provide you with information contained in this announcement and
will be unable to give advice on the merits of the Acquisition or
to provide legal, financial or taxation advice on the contents of
this announcement or the Acquisition.
Important Notices
Merrill Lynch International ("BofA Securities"), which is
authorised by the UK Prudential Regulation Authority and regulated
by the FCA and the UK Prudential Regulation Authority, is acting
exclusively for Anglo American and for no one else and will not be
responsible to anyone other than Anglo American for providing the
protections afforded to its clients or for providing advice in
relation to the matters referred to in this announcement. Neither
BofA Securities, 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 BofA Securities in connection
with this announcement, any statement contained herein or
otherwise.
Centerview Partners UK LLP ("Centerview Partners") is authorised
and regulated by the FCA. Centerview Partners is acting exclusively
for Anglo American and no one else in connection with the matters
referred to in this announcement. Centerview Partners is not and
will not be responsible to anyone other than Anglo American for
providing the protections afforded to its clients or for providing
advice in connection with the contents of this announcement or any
other matter referred to in this announcement. Neither Centerview
Partners, nor any of its affiliates, owes or accepts any duty,
liability or responsibility whatsoever to any person who is not a
client of Centerview Partners in connection with this announcement,
any statement contained herein or otherwise.
J.P. Morgan Securities plc, which conducts its UK investment
banking business as J.P. Morgan Cazenove ("J.P. Morgan Cazenove"),
is authorised in the United Kingdom by the Prudential Regulation
Authority and regulated in the United Kingdom by the Prudential
Regulation Authority and the FCA. J.P. Morgan Cazenove is acting as
financial adviser exclusively for Sirius and no one else in
connection with the matters set out in this announcement and will
not regard any other person as its client in relation to the
matters in this announcement and will not be responsible to anyone
other than Sirius for providing the protections afforded to clients
of J.P. Morgan Cazenove, or for providing advice in relation to any
matter referred to herein.
Lazard & Co., Limited ("Lazard"), which is authorised and
regulated by the FCA in the United Kingdom, is acting exclusively
for Sirius and for no one else and will not be responsible to
anyone other than Sirius for providing the protections afforded to
its clients or for providing advice in connection with the matters
set out in this announcement. Neither Lazard 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 Lazard in connection with this announcement, any statement
contained herein, the transaction described herein or
otherwise.
Liberum Capital Limited ("Liberum Capital"), which is authorised
and regulated in the United Kingdom by the FCA, is acting as joint
broker exclusively for Sirius and for no one else in connection
with the matters set out in this announcement and will not regard
any other person as its client in relation to the matters in this
announcement and will not be responsible to anyone other than
Sirius for providing the protections afforded to clients of Liberum
Capital, or for providing advice in relation to any matter referred
to herein.
Shore Capital Stockbrokers Limited ("Shore Capital"), which is
authorised and regulated in the United Kingdom by the FCA, is
acting as joint broker exclusively for Sirius and no one else in
connection with the matters set out in this announcement and will
not regard any other person as its client in relation to the
matters in this announcement and will not be responsible to anyone
other than Sirius for providing the protections afforded to clients
of Shore Capital, or for providing advice in relation to any matter
referred to herein.
This announcement is for information purposes only and does not
constitute an offer to sell or an invitation to purchase any
securities or the solicitation of an offer to buy any securities,
pursuant to the Acquisition or otherwise.
The Acquisition shall be made solely by means of the Scheme
Document which shall contain the full terms and conditions of the
Acquisition, including details of how to vote in respect of the
Acquisition.
This announcement has been prepared for the purpose of complying
with the laws of England and Wales and the Takeover Code and the
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 England and Wales.
Sirius shall prepare the Scheme Document to be distributed to
Sirius Shareholders. Sirius and Anglo American urge Sirius
Shareholders to read the Scheme Document when it becomes available
because it shall contain important information relating to the
Acquisition.
This announcement does not constitute a prospectus or prospectus
exempted document.
Overseas Shareholders
The release, publication or distribution of this announcement in
or into certain jurisdictions other than the United Kingdom or the
United States may be restricted by law. Persons who are not
resident in the United Kingdom or the United States or who are
subject to other jurisdictions should inform themselves of, and
observe, any applicable requirements.
Unless otherwise determined by Anglo American or required by the
Takeover Code, and permitted by applicable law and regulation, the
Acquisition shall not be made available, directly or indirectly,
in, into or from a Restricted Jurisdiction where to do so would
violate the laws in that jurisdiction and no person may vote in
favour of the Acquisition by any such use, means, instrumentality
or form within a Restricted Jurisdiction or any other jurisdiction
if to do so would constitute a violation of the laws of that
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
where to do so would violate the laws in that 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
jurisdictions where to do so would violate the laws in that
jurisdiction.
The availability of the Acquisition to Sirius Shareholders who
are not resident in the United Kingdom (and, in particular, their
ability to vote their Sirius Shares with respect to the Scheme at
the Court Meeting, or to appoint another person as proxy to vote at
the Court Meeting on their behalf) may be affected by the laws of
the relevant jurisdictions in which they are resident. Persons who
are not resident in the United Kingdom should inform themselves of,
and observe, any applicable requirements, as failure to comply with
such requirements 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.
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 shares of a UK company and is
proposed to be effected by means of a scheme of arrangement under
the laws of England and Wales. A transaction effected by means of a
scheme of arrangement is not subject to the tender offer rules or
the proxy solicitation rules under the US Exchange Act.
Accordingly, the Acquisition is subject to the disclosure and
procedural requirements applicable in the United Kingdom to schemes
of arrangement which differ from the disclosure requirements of
United States tender offer and proxy solicitation rules.
Neither the US Securities and Exchange Commission nor any US
state securities commission has approved or disproved or passed
judgment upon the fairness or the merits of the Acquisition or
determined if this announcement is adequate, accurate or complete.
Any representation to the contrary is a criminal offence in the
US.
However, if Anglo American were to elect to implement the
Acquisition by means of a takeover offer, such takeover offer shall
be made in compliance with all applicable United States laws and
regulations, including any applicable exemptions under the US
Exchange Act. Such a takeover would be made in the United States by
Anglo American and no one else.
In the event that the Acquisition is implemented by way of
Takeover Offer, in accordance with normal United Kingdom practice
and pursuant to Rule 14e-15(b) of the US Exchange Act, Anglo
American 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 Sirius outside of the US,
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 in the UK, shall be reported to a Regulatory
Information Service and shall be available on the London Stock
Exchange website at www.londonstockexchange.com.
The receipt of consideration by a US holder for the transfer of
its Sirius Shares pursuant to the Scheme shall be a taxable
transaction for United States federal income tax purposes. Each
Sirius Shareholder is urged to consult their independent
professional adviser immediately regarding the tax consequences of
the Acquisition applicable to them, including under applicable
United States state and local, as well as overseas and other, tax
laws.
Financial information relating to Sirius included in this
announcement and the Scheme Document has been or shall have been
prepared in accordance with accounting standards applicable in the
United Kingdom and 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 United States.
Anglo American, Bidco and Sirius are each organised under the
laws of England and Wales. Some or all of the officers and
directors of Anglo American, Bidco and Sirius, respectively, are
residents of countries other than the United States. As a result,
it may be difficult for US Sirius Shareholders to effect service of
process within the United States upon Anglo American, Bidco or
Sirius or their respective officers or directors or to enforce
against them a judgment of a US court predicated upon the federal
or state securities laws of the United Kingdom.
Forward looking statements
This announcement (including information incorporated by
reference in this announcement), oral statements made regarding the
Acquisition, and other information published by Sirius, Anglo
American or any member of the Anglo American Group contain
statements which are, or may be deemed to be, "forward-looking
statements". Such forward-looking statements are prospective in
nature and are not based on historical facts, but rather on current
expectations and on numerous assumptions regarding the business
strategies and the environment in which Anglo American, any member
of the Anglo American Group or the Enlarged Group shall operate in
the future and are subject to risks and uncertainties that could
cause actual results to differ materially from those expressed or
implied by those statements.
The forward-looking statements contained in this announcement
relate to Anglo American, any member of the Anglo American Group or
the Enlarged Group's future prospects, developments and business
strategies, the expected timing and scope of the Acquisition and
other statements other than historical facts. In some cases, these
forward-looking statements can be identified by the use of forward
looking terminology, including the terms "believes", "estimates",
"will look to", "would look to", "plans", "prepares",
"anticipates", "expects", "is expected to", "is subject to",
"budget", "scheduled", "forecasts", "synergy", "strategy", "goal",
"cost-saving", "projects", "intends", "may", "will", "shall" or
"should" or their negatives or other variations or comparable
terminology. Forward-looking statements may 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 Anglo American's, any member of the Anglo
American Group's or Sirius' operations and potential synergies
resulting from the Acquisition; and (iii) the effects of global
economic conditions and governmental regulation on Anglo
American's, any member of the Anglo American Group's or Sirius'
business.
By their nature, forward-looking statements involve risk and
uncertainty because they relate to events and depend on
circumstances that shall occur in the future. These events and
circumstances include changes in the global, political, economic,
business, competitive, market and regulatory forces, future
exchange and interest rates, changes in tax rates and future
business combinations or disposals. If any one or more of these
risks or uncertainties materialises or if any one or more of the
assumptions proves incorrect, actual results may differ materially
from those expected, estimated or projected. Such forward-looking
statements should therefore be construed in the light of such
factors.
Neither Sirius nor any of Anglo American nor any member of the
Anglo American Group, 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
shall actually occur. Given these risks and uncertainties,
potential investors should not place any reliance on
forward-looking statements.
The forward-looking statements speak only at the date of this
announcement. All subsequent oral or written forward-looking
statements attributable to any member of the Anglo American Group
or Sirius Group, or any of their respective associates, directors,
officers, employees or advisers, are expressly qualified in their
entirety by the cautionary statement above.
Sirius, the Anglo American Group and Anglo American expressly
disclaim any obligation to update such statements other than as
required by 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 estimates
No statement in this announcement is intended as a profit
forecast or estimate for any period and no statement in this
announcement should be interpreted to mean that earnings or
earnings per share for Anglo American or Sirius, as appropriate,
for the current or future financial years would necessarily match
or exceed the historical published earnings or earnings per share
for Anglo American or Sirius, as appropriate.
Disclosure requirements of the Takeover Code
Under Rule 8.3(a) of the Takeover Code, any person who is
interested in 1 per cent. 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 per cent. 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,
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 shall 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 http://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. If you are in any doubt as to whether you are required
to make an Opening Position Disclosure or a Dealing Disclosure, you
should contact the Panel's Market Surveillance Unit on +44 (0)20
7638 0129.
Electronic communications
Please be aware that addresses, electronic addresses and certain
information provided by Sirius Shareholders, persons with
information rights and other relevant persons for the receipt of
communications from Sirius may be provided to Anglo American during
the Offer Period as requested under Section 4 of Appendix 4 of the
Takeover Code to comply with Rule 2.11(c) of the Takeover Code.
Publication on website and availability of hard copies
A copy of this announcement shall be made available, subject to
certain restrictions relating to persons resident in Restricted
Jurisdictions, on Anglo American's and Sirius' websites at
www.angloamerican.com/offer and
www.siriusminerals.com/investors/firm-offer-from-anglo-american-plc
respectively by no later than 12 noon (London time) on the Business
Day following the publication of this announcement. For the
avoidance of doubt, the contents of these websites are not
incorporated into and do not form part of this announcement.
You may request a hard copy of this announcement by contacting
Sirius' registrars, Link Asset Services, during business hours on
0871 664 0300 (or +44(0) 371 664 0300 from abroad) or at The
Registry, 34 Beckenham Road, Beckenham, Kent, BR3 4TU. You may also
request that all future documents, announcements and information to
be sent to you in relation to the Acquisition should be 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.
Rule 2.9 Disclosure
In accordance with Rule 2.9 of the Takeover Code, Sirius
confirms that as at the date of this announcement, it has in issue
and admitted to trading on the Main Market of the London Stock
Exchange, 7,020,196,560 ordinary shares of 0.25 pence each (no
ordinary shares are held in treasury). The International Securities
Identification Number (ISIN) of the ordinary shares is
GB00B0DG3H29.
Sirius has an American depositary receipts ("ADR") program
comprising 30,229 ADRs, for which Deutsche Bank Trust Company
Americas acts as depositary. These ADRs represent 1,511,450
ordinary shares of Sirius. The ADRs are traded over-the-counter.
The trading symbol for the ADR securities is SRUXY and the ISIN is
US82967P1030.
In addition, the Sirius Group has US$236,600,000 convertible
bonds outstanding. These bonds are convertible into Sirius ordinary
shares and comprise two series: (i) US$137,600,000 8.5 per cent.
convertible bonds due 2023 (ISIN code: XS1515223516); and (ii)
US$99,000,000 5.0 per cent. convertible bonds due 2027 (ISIN code:
XS1991118255).
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 OF SUCH
JURISDICTION
THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION
FOR IMMEDIATE RELEASE
20 January 2020
RECOMMED CASH ACQUISITION
for
SIRIUS MINERALS PLC
by
ANGLO AMERICAN PROJECTS UK LIMITED
(a wholly owned subsidiary of Anglo American plc)
1 Introduction
The boards of Anglo American plc ("Anglo American"), Anglo
American Projects UK Limited ("Bidco") and Sirius Minerals Plc
("Sirius") are pleased to announce that they have reached agreement
on the terms of a recommended cash acquisition pursuant to which
Bidco shall acquire the entire issued and to be issued share
capital of Sirius (the "Acquisition"). The Acquisition is intended
to be effected by means of a scheme of arrangement under Part 26 of
the Companies Act.
2 The Acquisition
Under the terms of the Acquisition, which shall be subject to
the Conditions and further terms set out in Appendix I to this
announcement and to be set out in the Scheme Document, Sirius
Shareholders shall be entitled to receive:
for each Sirius Share 5.50 pence in cash
The Acquisition values the entire issued and to be issued share
capital of Sirius at approximately GBP404.9 million and represents
a premium of approximately:
-- 34.1 per cent. to the Closing Price of 4.10 pence per Sirius
Share on 7 January 2020 (being the last Business Day prior to the
commencement of the Offer Period);
-- 46.5 per cent. to the volume-weighted average price of 3.75
pence per Sirius Share since Sirius' 17 September 2019 strategic
review announcement to 7 January 2020 (being the last Business Day
prior to the commencement of the Offer Period);
-- 53.4 per cent. to the one-month volume-weighted average price
of 3.59 pence per Sirius Share to 7 January 2020 (being the last
Business Day prior to the commencement of the Offer Period);
and
-- 61.7 per cent. to the three-month volume-weighted average
price of 3.40 pence per Sirius Share to 7 January 2020 (being the
last Business Day prior to the commencement of the Offer
Period).
If, on or after the date of this announcement and on or prior to
the Effective Date, any dividend, distribution or other return of
value is declared, made or paid by Sirius on the Sirius Shares, the
Offer Price shall be reduced correspondingly. In such
circumstances, Sirius Shareholders would be entitled to retain any
such dividend, distribution or other return of value declared, made
or paid.
It is expected that the Scheme Document, containing further
information about the Acquisition and notices of the Court Meeting
and the General Meeting, shall be sent to Sirius Shareholders
within 28 days of this announcement and it is expected that the
Scheme will become Effective by 31 March 2020.
3 Background to and reasons for the Acquisition
In September 2019, Sirius announced that it was undertaking a
strategic review in order to assess the development plan for its
North Yorkshire polyhalite project (the "Project") and an
appropriate financing structure to provide relevant funding. Sirius
also announced that the strategic review would include a broader
process to seek a major strategic partner in the Project. In
November 2019, Sirius provided an update on the progress of this
strategic review, including a revised two-stage development
plan.
The Project, once developed, is expected to produce a premium
fertiliser product that has the potential to generate demand both
on a standalone basis and when blended with existing products at a
competitive cost that would support attractive margins.
Anglo American is a leading global mining company with a
world-class portfolio of mining and mineral processing operations
and undeveloped resources, combined with a worldwide marketing
network through which it sells its products to customers. Anglo
American has a clear, asset-led strategy and the quality, long life
and growth potential of those mineral assets are the foundation of
the long-term competitiveness and sustainability of its
business.
Anglo American identified the Project as being of potential
interest some time ago, given the quality of the underlying asset
in terms of scale, resource life, operating cost profile and the
nature and quality of its product. The Project has the potential to
fit well with Anglo American's established strategy of focusing on
world-class assets, particularly in the context of Anglo American's
portfolio trajectory towards later cycle products that support a
fast-growing global population and a cleaner, greener, more
sustainable world.
Anglo American believes that the offer provides certainty to
Sirius Shareholders, employees and wider stakeholders, whilst Anglo
American brings financial, technical and marketing resources and
capabilities to progress the Project over time, with the potential
for associated employment and economic benefits for the local area.
Anglo American remains committed to its disciplined capital
allocation framework. In the first two years after successful
completion of the Acquisition, development work on the Project is
expected to be broadly in line with Sirius' revised development
plan although Anglo American intends to update the development
timeline, optimise mine design and ensure appropriate integration
with its own operating standards and practices. As part of that
process, Anglo American will review the residual capital for the
Project under its ownership. Sirius currently expects incremental
capital of approximately US$3.3 billion in order to reach a
production level of 10 mtpa and assuming a P90 contingency. During
these first two years and subject to the update, development work
of approximately US$300 million per annum is expected. In line with
its capital allocation framework Anglo American will also keep
potential syndication of the Project under review.
Within Anglo American's portfolio, the Project is expected to
benefit from Anglo American's technical expertise in both the
development and operational phases, as well as from Anglo
American's recognised Operating Model to drive safety and
productivity to world-leading standards. Integration into Anglo
American's marketing network provides further potential through
full mine-to-market capabilities and institutional experience in
the world's major fertiliser markets.
Anglo American notes the following key attributes of the Project
from its initial assessment:
Asset quality
Anglo American believes that the Project has the potential to
become a world-class, low-cost and long-life asset. Sirius has
progressed the development of the Project to an advanced stage,
with construction now under way for over two years. Sirius has
indicated that this is currently the world's largest known
high-grade polyhalite deposit with a JORC Reserve of 290 million
tonnes, with a grade of 88.8% and a Resource of 2.69 billion
tonnes. The Resource indicated by Sirius has the scale, thickness
and quality to be mined efficiently through a relatively simple,
low-energy, non-chemical production process. Anglo American expects
that this could result in total unit costs of US$40-50 per tonne at
an initial level of production of 10 mtpa. Sirius has indicated
that the Project could operate at an EBITDA margin potentially well
in excess of 50%, leaving the Project well positioned for strong
through-the-cycle profitability with an anticipated long asset
life.
Development pathway
As at 30 September 2019, US$1.1 billion has been invested in the
development of the Project, with construction supported by the
appointment of well-proven contractors including DMC Mining
Services Ltd, Strabag AG, Worley Parsons Ltd and P. J. Carey
(Contractors) Limited.
All material development, operational and export approvals are
in place and access rights secured for the current development plan
including the sinking of an operation and a service shaft, the
construction of the proposed mineral transport system ("MTS") and
the material handling facility ("MHF") as well as the refurbishment
of the port handling facility. The MTS will transport product 37km
underground, directly from the mine to the MHF. This will have
direct access to dedicated, deep-water harbour facilities.
Prior to completion of the Acquisition, Sirius intends to
provide Anglo American and Bidco with information relating to its
ongoing cash balance and cash flow requirements in respect of the
Offer Period, provided that Anglo American and Bidco agree that
such information shall not be used as the basis for invoking any
Condition to the Acquisition. Anglo American, Bidco and Sirius
intend to work with each other (to the extent legally permissible)
to ensure that the business continues to address the financial
challenges it faces in the long-term best interests of Sirius and
its stakeholders.
Premium product
Global fertiliser demand is driven by factors including food,
feed and fuel demand, which are in turn driven by population
growth, diet, arable land per capita and biofuel demand. The use of
fertilisers is one of the most effective ways to improve
agricultural yields and therefore help to address the anticipated
future imbalance between food, feed and biofuel demand and supply.
Fertilisers are therefore likely to have a critical role to play in
a sustainable future.
Sirius' polyhalite product, POLY4, is a multi-nutrient
fertiliser certified for organic use and has the potential to
generate demand at a competitive cost that supports a strong
margin. POLY4 is an attractive low-chloride alternative to, and for
blending with, traditional fertiliser products on a cost-effective
basis. It includes four of the six key macro-nutrients necessary
for plant growth, being potassium, sulphur, magnesium and calcium,
and has been certified for organic use.
Over a period of 7 years, a total of 492 trials across 54
different crops in 31 different countries have been undertaken by
Sirius to support discussions with customers on the technical and
commercial applications of POLY4. These have shown that polyhalite
can improve crop yield, quality and taste. Polyhalite can also
improve plant resistance to drought, frost, insects and diseases.
Trials are ongoing and will continue to take place during the
review phase.
POLY4 will be positioned as a premium product as a result of its
multi-nutrient, lower-chloride composition. POLY4 and Sulphate of
Potash have significantly lower chloride content (less than five
per cent.) than the most commonly used potash fertilizer, Muriate
of Potash (approximately 40 per cent.). This is important because
many of the world's major crops, such as tea, coffee, beans,
potatoes, and many fruits and vegetables, are particularly
sensitive to chloride. Sirius has also identified that POLY4
generates significantly less CO(2) per tonne relative to both
Sulphate of Potash and Muriate of Potash (less than, approximately,
93% and 85% respectively).
As a result of the significant benefits and potential for POLY4,
Sirius has been able to enter into a number of customer offtake
agreements with well-established counterparties such as Archer
Daniels Midland Company, BayWa AG, Cibrafertil Companhia Brasileira
de Fertilizantes, Indian Farmers Fertilisers Cooperative Ltd,
Wilmar Group and Qatar Chemical and Petrochemical Marketing and
Distribution Company Q.p.J.S.C. A large proportion of these
agreements have specific price levels recognising the value from
key nutrients and have been set up on a take-or-pay basis. In
total, these offtake arrangements accommodate production in excess
of 10 mtpa. Based on January 2019 prices, the indicative weighted
average FOB price for POLY4 would be approximately US$140 per tonne
under the offtake agreements as outlined in Sirius' May 2019
prospectus. This figure is not a forecast of future pricing and
future pricing could be materially different.
Investing in the United Kingdom
The Project is located in North Yorkshire in the United Kingdom
and offers the potential for significant investment and sustained
job creation in the region, both directly and indirectly. Key
stakeholders, including the North York Moors National Parks
Authority, Scarborough Borough Council and a number of local
landowners continue to express their support for its
development.
As a sign of its intent to support the sustainable development
of the Project's host communities, Anglo American intends to make a
voluntary contribution of GBP4 million to the Sirius Minerals
Foundation, with GBP1 million to be paid on completion of the
Acquisition and a further GBP1 million to be paid on the
anniversary of completion of the Acquisition for the next three
years.
4 Recommendation
The Sirius Directors, who have been so advised by J.P. Morgan
Cazenove and Lazard as to the financial terms of the Acquisition,
consider the terms of the Acquisition to be fair and reasonable. In
providing their advice to Sirius Directors, J.P. Morgan Cazenove
and Lazard have taken into account the commercial assessments of
the Sirius Directors. In addition, the Sirius Directors consider
the terms of the Acquisition to be in the best interests of Sirius
Shareholders as a whole.
Accordingly, the Sirius Directors intend to recommend
unanimously that Sirius Shareholders vote in favour of the Scheme
at the Court Meeting and the resolutions to be proposed at the
General Meeting as the Sirius Directors who hold Sirius Shares have
irrevocably undertaken to do or procure to be done in respect of
their own beneficial holdings, amounting, in aggregate, to
172,462,637 Sirius Shares, representing, in aggregate,
approximately 2.46 per cent. of the issued share capital of Sirius
as at 16 January 2020 (being the latest practicable date prior to
announcement).
Further details of these irrevocable undertakings (including the
circumstances in which they shall fall away) are set out in
Appendix III to this announcement.
5 Background to and reasons for the recommendation
On 17 September 2019 Sirius announced that, as a result of
market conditions impacting its ability to deliver its Stage 2
Financing, it would be slowing the pace of development on its North
Yorkshire polyhalite project and undertaking a strategic review
over a period of six months. The purpose of the strategic review
was to consider and incorporate optimisations to the project
development plan and to explore alternative funding solutions,
including conducting a process with the aim of identifying and
securing a strategic investor in the project, in order to reassess
the best way to unlock the value of the project for Sirius
Shareholders, the community, the UK, and Sirius' customers all
around the world. Sirius believed that the compelling economics of
the Project provided a strong basis for a revised funding plan, but
that it would require time to bring together components of such a
plan and to assess investor appetite for a revised funding plan.
The strategic review also recognised the difficult market
conditions in the project finance market for single asset companies
with a greenfield mining project and took into account the feedback
received from prospective senior debt providers (including during
Stage 2 Financing) around the risks associated with construction.
Sirius had identified strategic partners as a way to bring extra
capital into the Project to strengthen the credit case, as well as
to potentially provide extra support during construction.
As at 31 August 2019, Sirius had approximately GBP180 million of
unrestricted cash. That amount did not provide sufficient liquidity
for Sirius to continue the development of the project in line with
its original development schedule for any significant period of
time. Therefore, the Sirius Board determined that the scope of
development works would be scaled down to provide time to conduct
the strategic review of the project development and to explore
various funding options. The reduced pace of development focused on
maintaining key areas of the Project to preserve the most value for
the Project.
During the preliminary phase of the strategic review, Sirius
assessed the development options available to significantly de-risk
the proposition for any future senior debt providers. In the debt
raising processes conducted by Sirius over the last three years,
one common aspect identified by prospective credit providers had
been the perceived risk associated with deep shaft construction. On
11 November 2019, Sirius announced an update to the strategic
review which had identified a two-stage development plan to enable
Sirius to achieve the key de-risking milestone of first polyhalite,
when the service shaft reaches the polyhalite ore body, with an
upfront capital requirement of US$600 million (in addition to
existing cash resources) for this initial scope. The deferred scope
of additional works required to reach an installed and ramped up
production capacity of 10 mtpa contemplated up to US$2.5 billion of
further capital expenditure thereafter. At the same time, Sirius
announced that it was seeking to have the initial scope funded from
the proceeds of either the strategic investor process or through a
structured debt financing package, with either potentially
incorporating the issue of new equity or an equity-like component
to the financing package. Sirius confirmed that the strategic
partner and debt financing processes were underway with the aim of
securing US$600 million of initial scope funding, with various
parties engaged and assessing information.
Sirius and its advisers have undertaken an extensive global
engagement process, covering mining and fertilizer companies,
broader natural resource and industrial companies, financial
sponsors, sovereign wealth funds and family offices, as well as
providers of structured finance and mezzanine investors. Sirius has
facilitated access to project information, conducted site visits
and management presentations, supported due diligence requirements
and held discussions with parties interested in the Project. Sirius
has also evaluated capital markets financing options including
institutional equity and retail equity investors, senior mezzanine
and junior debt and convertible debt. The Sirius Board has
carefully and regularly reviewed the progress of the revised
funding plan. It has monitored the status of all parties involved
in the strategic investor and debt financing processes and has
evaluated discussions and proposals received against the objectives
of the strategic review and the Sirius Group's remaining liquidity
position.
As at 31 December 2019, Sirius had approximately GBP59.9 million
of unrestricted cash, which was broadly in line with the expected
capital spend when the strategic review was announced on 17
September 2019. Unless Sirius is able to secure additional funding
or a merger or acquisition transaction involving Sirius by the end
of March 2020 or soon thereafter, the Sirius Board would be
required to place Sirius into administration or liquidation, which
could result in Shareholders losing all of their investment in
Sirius.
In conjunction with this review, Anglo American actively
explored an interest in Sirius during Q4 2019. On 6 January 2020
the Sirius Board received a non-binding indicative proposal from
Anglo American expressing an interest in acquiring Sirius. On 8
January 2020, Sirius announced that it was in advanced discussions
with Anglo American regarding a possible all-cash offer of 5.50
pence per Sirius Share for the entire issued, and to be issued,
share capital of Sirius. Following receipt of the Anglo American
proposal, the Sirius Board carefully assessed the merits of the
proposal against the potential alternative options from other
parties involved in the ongoing strategic investor and debt
financing processes and also in light of the Sirius Group's current
and expected liquidity position.
The most advanced alternative proposal was a potential debt
financing proposal from a consortium of financial investors. In
December 2019, Sirius received a non-binding term sheet from the
consortium to form the basis of a US$680 million funding package to
cover the initial scope of work. On 9 January 2020, Sirius received
a revised non-binding term sheet from the consortium. The Sirius
Board reviewed the proposed terms and conditions, together with its
advisers, and concluded that the consortium's conditions and the
time it would take to meet such conditions were such that there is
a very material risk that the overall funding package would not be
implementable by the end of March 2020. Based on the backdrop of
the search for a standalone funding solution undertaken over the
last 4 months and the extensive discussions held during that
timeframe, the Sirius Board believes that, at this time, there is
not likely to be an alternative to the Acquisition other than
administration or liquidation.
In this context, the Sirius Directors view the Acquisition as
the only viable way forward for Sirius. It provides certainty of
value in cash to Sirius Shareholders (as against potentially losing
all of their investment) and, as a result of the support of the
Project by Anglo American, provides greater certainty of outcome
for Sirius' creditors. In addition, it safeguards the Project by
placing it into a group with the financial, technical and marketing
resources and capabilities to progress it over time; it protects
the employees, and allows the community, region and the UK to
continue to benefit from the Project.
The Sirius Directors, who have been so advised by J.P. Morgan
Cazenove and Lazard as to the financial terms of the Acquisition,
consider the terms of the Acquisition to be fair and reasonable.
J.P. Morgan Cazenove and Lazard are providing independent financial
advice to the Sirius Board for the purposes of Rule 3 of the
Takeover Code. In providing advice to the Sirius Board, J.P. Morgan
Cazenove and Lazard have taken into account the commercial
assessments of the Sirius Board.
The Sirius Directors consider the terms of the Acquisition to be
in the best interests of Sirius Shareholders as a whole. The Sirius
Directors therefore unanimously recommend that Sirius Shareholders
vote in favour of the Scheme at the Court Meeting and the Special
Resolution to be proposed at the Sirius General Meeting.
6 Information on Anglo American
Anglo American
Anglo American is a leading global mining company whose products
are the essential ingredients in almost every aspect of modern
life. Its portfolio of world-class competitive mining operations
and undeveloped resources provides the metals and minerals that
enable a cleaner, greener and more sustainable world and that meet
the fast-growing consumer-driven demands of the world's developed
and maturing economies. With people at the heart of its business,
Anglo American uses innovative practices and the latest
technologies to discover new resources and mine, process, move and
market its products to customers around the world - safely,
responsibly and sustainably.
Anglo American was founded in 1917 and today produces diamonds
(through De Beers), copper, platinum group metals, iron ore,
metallurgical coal, nickel and thermal coal, with operations and
projects in development in Australia, Botswana, Brazil, Canada,
Chile, Colombia, Namibia, Peru, South Africa and Zimbabwe, most of
whose products are marketed to customers via a dedicated global
marketing business based in London and Singapore. In 2018, Anglo
American generated revenue of US$27.6 billion, an underlying EBITDA
of US$9.2 billion and profit attributable to equity shareholders of
US$3.5 billion, with a 19% Return on Capital Employed.
Headquartered in London and listed on the London and Johannesburg
stock exchanges with a market capitalisation of GBP29.8 billion as
of 16 January 2020, Anglo American employs approximately 90,000
people around the world.
The Acquisition will mark a continuation of Anglo American's
long experience in the fertiliser market over much of the last 50
years, having owned and operated assets both in the U.K and more
recently in Brazil until 2016 when it ceased to have any interests
in the fertiliser market.
Bidco
Bidco is a newly incorporated indirect wholly owned subsidiary
of Anglo American, and is a private limited company incorporated in
England and Wales.
Bidco has not traded since incorporation, nor has it entered
into any obligations, other than in connection with the
Acquisition.
7 Information on Sirius
Sirius is a public limited company registered in England and
Wales. The Sirius Shares are listed on the Official List.
Sirius was previously quoted on the AIM market of the London
Stock Exchange in 2005 and the Sirius Shares were admitted to
trading to the Main Market of the London Stock Exchange on 28 April
2017. Since then, the Company's principal activities have been to
raise funds to invest in developing potential mining opportunities.
Prior to the acquisition of York Potash Limited and the Project in
January 2011, such development opportunities included projects in
North Dakota, Queensland and Western Australia. These projects and
associated project companies are now dormant or wound up, and
Sirius' resources have been dedicated to the development of the
Project.
8 Directors, management, employees and locations
Employees and management
Anglo American attaches great importance to the skill and
experience of Sirius' management and employees and recognises that
the commitment of the management and employees of Sirius will be
important to Anglo American going forward, particularly in relation
to the development of the Project and therefore, save as set out in
"Sirius senior management and incentivisation arrangements" below,
Anglo American does not intend to make any material change in the
conditions of employment of Sirius employees, unless otherwise
agreed with the relevant employee.
Anglo American intends to support the Sirius management team in
conjunction with the broader resources of Anglo American in order
to proceed with the development of the Project following a further
review of the development plan. Anglo American remains committed to
its disciplined capital allocation framework. In the first two
years after successful completion of the Acquisition, development
work on the Project is expected to be broadly in line with Sirius'
revised development plan although Anglo American intends to update
the development timeline, optimise mine design and ensure
appropriate integration with Anglo American's own operating
standards and practices. Following completion of the Acquisition,
Anglo American does not intend to initiate any material headcount
reductions within the current Sirius organisation or any material
changes in the balance of skills and functions of the Sirius
employees and management but may provide additional support to the
Project through the use of Anglo American's skills and
capabilities. Anglo American intends to continue to support Sirius'
existing engineering apprentice scheme.
Sirius currently has a head office in Scarborough with a small
registered office in London. Following completion of the
Acquisition, Anglo American intends to maintain Sirius' Scarborough
office and to close Sirius' London office. Anglo American intends
to maintain Sirius' executive, sales and projects functions across
both locations and consolidate certain corporate and support
functions with corresponding Anglo American functions. Anglo
American has not yet determined whether these steps will result in
headcount reductions but Anglo American would expect that any
required reductions would not be material in number.
It is expected that, upon completion of the Acquisition, each of
the non-executive members of the Sirius Board shall resign from
his/her office as a Sirius Director.
Existing rights and pension schemes
Anglo American has given assurances to the Sirius Directors
that, following completion of the Acquisition, the existing
contractual and statutory rights and terms and conditions of
employment, including pension obligations, of the management and
employees of the Sirius Group will be fully safeguarded in
accordance with applicable law. The Sirius Group has confirmed to
Anglo American that the only pension scheme it currently makes
available to its employees is a defined contribution pension scheme
provided through an external provider and it does not have any
current or historical liability exposure to any pension
arrangements providing benefits on a defined benefit basis. Anglo
American therefore does not anticipate any pensions underfunding
risk or exposure to any pension scheme deficit arising under
legislation to, or in respect of, the Sirius Group employees
following completion of the Acquisition.
Sirius senior management and incentivisation arrangements
Each of the Sirius Chief Executive Officer; Chief Financial
Officer; General Counsel and Company Secretary; Chief Development
Officer; Chief Marketing Officer; External Affairs Director and
People Director have agreed that they will remain with the Sirius
business following completion of the Acquisition, for a period of
at least one year. Anglo American has therefore agreed that during
the period of one year following completion there will be no
changes to these individuals' remuneration arrangements in respect
of salary, benefits and pensions, and that during this period they
will continue to participate in a bonus and a long-term incentive
arrangement in accordance with their current ordinary level of
annual bonus and long-term incentive participation. The annual
bonus and long-term incentive arrangements will be cash-based and
subject to terms, including in relation to continued employment and
performance conditions, to be determined in due course.
Locations, fixed assets and research and development
Except as referred to in "Employees and management" above, Anglo
American does not intend to make any material restructurings or
changes in location of Sirius' operations and places of business
following completion of the Acquisition.
No changes are envisaged by Anglo American with respect to the
redeployment of Sirius' fixed asset base.
Sirius' research, or global agronomy, programme is designed to
provide scientific data on specific crop responses to POLY4 and
POLY4-based NPK blends to support ongoing discussions with
customers on the technical and commercial applications of POLY4.
Anglo American intends to continue to support Sirius' research
programme.
The Acquisition shall not have any impact on the existing
business of Anglo American.
De-listing
Prior to the Scheme becoming Effective, it is intended that
applications will be made to the London Stock Exchange to cancel
trading in Sirius Shares on the London Stock Exchange's Main Market
for listed securities and to the FCA to cancel the listing of
Sirius Shares from the Official List, in each case to take effect
on or shortly after the Effective Date.
Other
No statements in this paragraph 8 constitute "post-offer
undertakings" for the purposes of Rule 19.5 of the Takeover
Code.
9 The Sirius Share Plans
Participants in the Sirius Share Plans shall be contacted
regarding the effect of the Acquisition on their rights under the
Sirius Share Plans and appropriate proposals shall be made to such
participants in due course. Further details of the terms of such
proposals shall be included in the Scheme Document and in separate
letters to be sent to participants in the Sirius Share Plans.
10 The Convertible Bonds
Anglo American will make an appropriate proposal to the
Convertible Bondholders. Anglo American intends to treat the
Effective Date as the date of occurrence of a "Change of Control"
under the terms and conditions of the Convertible Bonds. Under such
proposals, Convertible Bondholders will have the right:
-- to convert their Convertible Bonds at their prevailing
conversion price prior to the Effective Date of the Scheme.
Convertible Bondholders who exercise this right will participate in
the Scheme as holders of Sirius Shares and will receive the Offer
Price for each Sirius Share then held; and/or
-- subject to completion of the Acquisition, to convert their
Convertible Bonds during the period of 60 days following the
Effective Date at the enhanced change of control conversion price.
Convertible Bondholders who exercise this right will (as a result
of amendments to Sirius' articles of association proposed to be
implemented as from the Effective Date) receive the Offer Price for
each Sirius Share they would have otherwise been entitled to on
conversion, rather than the resulting Sirius Shares; and/or
-- subject to completion of the Acquisition to redeem their
Convertible Bonds, in the case of the Sirius 2023 Bonds, at their
principal amount plus accrued interest and, in the case of the
Sirius 2027 Bonds, at their accreted principal amount plus accrued
interest, in each case in accordance with the terms of the relevant
Convertible Bonds.
Further details of these proposals shall be included in the
Scheme Document and in the separate notice to be given to the
Convertible Bondholders in due course.
Convertible Bondholders that do not exercise any of these rights
will retain the right (for so long as their Convertible Bonds
remain outstanding and in accordance with the terms and conditions
of the Convertible Bonds) either to continue to hold their
Convertible Bonds or to convert their Convertible Bonds at the
prevailing conversion price following the end of the 60-day change
of control period. Convertible Bondholders who exercise this
conversion right will not be entitled to the enhanced change of
control conversion price and will receive the Offer Price for each
Sirius Share they would otherwise have been entitled to on
conversion, rather than the resulting Sirius Shares (as a result of
amendments to Sirius' articles of association proposed to be
implemented as from the Effective Date). For the avoidance of
doubt, the Acquisition is not conditional upon the approval of the
Convertible Bondholders.
11 Hancock royalty deed
Pursuant to a royalty financing agreement dated 25 October 2016
entered into between Sirius, York Potash Limited, York Potash
Processing & Ports Limited and Hancock British Holdings Limited
("Hancock") (as amended by a side letter dated 13 September 2018)
(together, the "Royalty Deed"), Hancock has a right to subscribe,
and Sirius has an obligation to require Hancock to subscribe, for
Sirius Shares subject to the terms and conditions of the Royalty
Deed being satisfied (or waived by Hancock). Pursuant to the terms
of the Royalty Deed, Hancock also has certain board observers and
rights to appoint a director to the Sirius Board.
Hancock has agreed that, conditional upon completion of the
Acquisition, Hancock irrevocably waives its right to subscribe, and
agrees that Sirius shall have no obligation to require Hancock to
subscribe, for Sirius Shares, and has agreed to remove the board
observers and director appointment rights afforded to it under the
terms of the Royalty Deed (the "Hancock Waiver"). Anglo American
has agreed, in a side letter (the "Waiver Side Letter"),
conditional upon completion of the Acquisition, to procure that
Sirius agrees to the terms of the Hancock Waiver.
12 Financing
Full acceptance of the Acquisition will result in the payment by
Anglo American of up to approximately GBP404.9 million in cash to
Sirius Shareholders. The cash consideration payable to Sirius
Shareholders under the terms of the Acquisition will be funded from
existing cash facilities.
BofA Securities, as financial adviser to Anglo American, is
satisfied that sufficient cash resources are available to Anglo
American to enable it to satisfy, in full, the cash consideration
payable to Sirius Shareholders under the terms of the
Acquisition.
13 Asset valuation reports
For the purposes of Rule 29 of the Takeover Code, Sirius notes
that the asset valuation reports it published in the 12 months
before the start of the Offer Period (specifically, in the Sirius
equity prospectus dated 1 May 2019 and the York Potash Intermediate
Holdings Plc preliminary bond offering memorandum dated 19 July
2019) were based on a series of assumptions and structures that are
no longer valid or relevant in the context of the Acquisition.
Sirius therefore disclaims the content of those reports and so the
information in them should be discounted by Sirius Shareholders
when considering the Acquisition.
14 Offer-related arrangements
Confidentiality Agreement
Anglo American Services (UK) Limited and Sirius entered into a
confidentiality agreement dated 8 January 2020 (the
"Confidentiality Agreement") pursuant to which Anglo American
Services (UK) Limited has undertaken, on behalf of the Anglo
American Group, to (i) keep confidential information relating to,
inter alia, the Acquisition and Sirius and not to disclose it to
third parties (other than to certain permitted parties) unless
required by law or regulation; and (ii) use the confidential
information only in connection with the Acquisition.
These confidentiality obligations shall remain in force until,
inter alia, completion of the Acquisition. Anglo American Services
(UK) Limited, on behalf of the Anglo American Group, also agreed to
certain standstill undertakings, all of which ceased to apply upon
the release of this announcement.
Co-operation Agreement
Anglo American, Bidco and Sirius have entered into a
Co-operation Agreement dated 20 January 2020, pursuant to
which:
(i) Anglo American and Bidco have agreed to use their reasonable
endeavours to secure the regulatory clearances and authorisations
necessary to satisfy the Regulatory Conditions as promptly as is
reasonably practicable;
(ii) Anglo American, Bidco and Sirius have agreed to certain
undertakings to co-operate in relation to such regulatory
clearances and authorisations; and
(iii) subject to Sirius complying with its obligations referred
to in (ii) above, Anglo American and Bidco have agreed to use their
reasonable endeavours to: (a) submit the definitive application
form to Brazil's Council for Economic Defence and its entities
("CADE") as soon as reasonably practicable and, in any event,
within two Business Days after this announcement; and (b) generally
progress the applications for Clearances in order to allow the
Clearances to be obtained as soon as reasonably practicable.
The Co-operation Agreement shall be terminated with immediate
effect if: (i) Anglo American, Bidco and Sirius so agree in
writing; or (ii) the Acquisition, with the permission of the Panel,
lapses, terminates or is withdrawn in accordance with its terms
(other than in certain limited circumstances).
Anglo American and Bidco have the right to terminate the
Co-operation Agreement if: (i) the Sirius Directors announce that
they shall not convene the Court Meeting or the General Meeting or
that they do not intend to publish the Scheme Document; (ii) the
Court Meeting or the General Meeting is not held by the 22(nd) day
after 5 March 2020 (or such later date as may be agreed by Anglo
American and Sirius); (iii) the Court Sanction Hearing is not held
by the 22(nd) day after 8 April 2020 or, if CADE do not consider
that the application form is eligible for the fast-track review
procedure, the 22(nd) day after 27 May 2020 (or such later date as
may be agreed by Anglo American and Sirius); (iv) the Sirius
Directors otherwise withdraw, adversely modify or adversely qualify
the recommendation referred to in this announcement; (v) a
competing proposal is recommended by the Sirius Directors or
effected; or (vi) any Condition not waived is incapable of
satisfaction, or any Condition incapable of waiver is incapable of
satisfaction (where such invocation has been permitted by the
Panel). The Co-operation Agreement shall also terminate: (i) if the
Scheme is not approved by the Sirius Shareholders at the Court
Meeting and/or the General Meeting or the Court refuses to sanction
the Scheme; or (ii) unless otherwise agreed by the parties in
writing, if the Effective Date has not occurred by the Long Stop
Date.
The Co-operation Agreement also records Anglo American's,
Bidco's and Sirius' intentions to implement the Acquisition by way
of the Scheme, subject to Anglo American and Bidco having the
right, subject to the consent of the Panel, to implement the
Acquisition by way of a Takeover Offer.
The Co-operation Agreement also contains provisions that shall
apply in respect of the Sirius Share Plans and certain other
employee incentive arrangements.
15 Structure of and Conditions to the Acquisition
It is intended that the Acquisition shall be effected by means
of a Court-approved scheme of arrangement between Sirius and Sirius
Shareholders under Part 26 of the Companies Act, although Anglo
American and Bidco reserve the right to implement the Acquisition
by way of a Takeover Offer (subject to Panel consent 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 share capital of
Sirius. This is to be achieved by the transfer of the Sirius Shares
to Bidco, in consideration for which the Sirius Shareholders who
are on the register of members at the Scheme Record Time shall
receive cash consideration on the basis set out in paragraph 2 of
this announcement.
The Acquisition shall be subject to the Conditions and further
terms set out below and in Appendix I to this announcement and to
be set out in the Scheme Document and shall only become Effective,
if, among other things, the following events occur on or before the
Long Stop Date or such later date as may be agreed by Anglo
American and Sirius (with the Panel's consent and as the Court may
approve (if such approval(s) are required)):
(i) the approval of the Scheme by a majority in number of the
Sirius Shareholders who are present and vote, whether in person or
by proxy, at the Court Meeting and who represent 75 per cent. in
value of the Sirius Shares voted by those Sirius Shareholders;
(ii) the resolutions required to approve and implement the
Scheme being duly passed by Sirius Shareholders representing the
requisite majority or majorities of votes cast at the General
Meeting (or any adjournment thereof);
(iii) the approval and sanction of the Scheme by the Court (with
or without modification but subject to any modification being on
terms acceptable to Sirius and Anglo American);
(iv) the delivery of a copy of the Court Order to the Registrar of Companies; and
(v) CADE having approved the consummation of the Acquisition
unconditionally pursuant to the Brazilian competition law No 12529
of 30 November 2011 and CADE's Internal Regiment (approved by CADE
Regulation No. 22 of 19 June 2019), or, if approved with
conditions, on such conditions as are reasonably satisfactory to
Anglo American.
The Scheme shall lapse if:
-- the Court Meeting and the General Meeting expected to take
place no later than 5 March 2020 are not held by 27 March 2020 (or
such later date as may be agreed between Anglo American and
Sirius);
-- the Court Sanction Hearing expected to take place no later
than 8 April 2020 is not held by 30 April 2020 or, if CADE do not
consider that the application form is eligible for the fast-track
review procedure, the Court Sanction Hearing expected to take place
no later than 27 May 2020 is not held by 18 June 2020 (or such
later date as may be agreed between Anglo American and Sirius);
or
-- the Scheme does not become Effective by the Long Stop Date,
provided, however, that the deadlines for the timing of the
Court Meeting, the General Meeting and the Court Sanction Hearing
as set out above may be waived by Anglo American, and the deadline
for the Scheme to become Effective may be extended by agreement
between Sirius, Anglo American and Bidco.
Subject to satisfaction (or waiver, where applicable) of the
Conditions, the Scheme is expected to become Effective by 31 March
2020.
Upon the Scheme becoming Effective, it shall be binding on all
Sirius Shareholders, irrespective of whether or not they attended
or voted at the Court Meeting or the General Meeting.
Further details of the Scheme shall be included in the Scheme
Document. It is expected that the Scheme Document, containing
further information about the Acquisition and notices of the Court
Meeting and the General Meeting, shall be sent to Sirius
Shareholders within 28 days of this announcement. The Scheme
Document and Forms of Proxy will be made available to all Sirius
Shareholders at no charge to them.
16 De-listing
Prior to the Scheme becoming Effective, it is intended that
applications will be made to the London Stock Exchange to cancel
trading in Sirius Shares on the London Stock Exchange's Main Market
for listed securities and to the FCA to cancel the listing of
Sirius Shares from the Official List, in each case to take effect
on or shortly after the Effective Date.
The last day of dealings in Sirius Shares on the Main Market of
the London Stock Exchange is expected to be the Business Day
immediately prior to the Effective Date and no transfers shall be
registered after 6.00p.m. on that date.
On the Effective Date, share certificates in respect of Sirius
Shares shall cease to be valid and entitlements to Sirius Shares
held within the CREST system shall be cancelled.
It is also proposed that, following the Effective Date and after
its shares are delisted, Sirius shall be re-registered as a private
limited company. A resolution to approve the re-registration will
be proposed at the General Meeting.
17 Dividends
Sirius has not declared any dividends for the financial year
2018 and half-year period ended 30 June 2019.
If, on or after the date of this announcement and on or prior to
the Effective Date, any dividend, distribution or other return of
value is declared, made or paid by Sirius, the Offer Price shall be
reduced correspondingly. In such circumstances, Sirius Shareholders
would be entitled to retain any such dividend, distribution or
other return of value declared, made or paid.
18 Sirius ADRs
The Scheme shall not be extended to holders of Sirius ADRs.
Therefore, if the Scheme becomes Effective, Deutsche Bank Trust
Company Americas (the "Sirius Depositary"), shall call for
surrender of the Sirius ADRs and, upon those surrenders, shall
deliver the consideration under the Acquisition, net of applicable
fees, expenses, taxes and governmental charges, to the holders of
the Sirius ADRs entitled to them in accordance with the terms of
the Deposit Agreement. Thereafter, the Sirius ADR program shall be
terminated.
Holders of Sirius ADRs shall not be entitled to vote directly on
the Scheme and the Acquisition. However, holders of Sirius ADRs
have the right to instruct the Sirius Depositary how to vote the
Sirius Shares in respect of the Sirius Shares underlying the Sirius
ADRs, subject to and in accordance with the terms of the Deposit
Agreement.
Holders of Sirius ADRs that wish to vote directly on the Scheme
and the Acquisition must surrender their Sirius ADRs to the Sirius
Depositary, pay the Sirius Depositary's fees and charges in
accordance with the Deposit Agreement and become holders of Sirius
Shares prior to the Scheme Voting Record Time, in each case subject
to and in accordance with the terms of the Deposit Agreement.
Holders of Sirius ADRs that wish to vote directly on the Scheme
should take care to surrender their Sirius ADRs in time to permit
processing to be completed by the Sirius Depositary and its English
custodian prior to the Scheme Voting Record Time. Any person that
holds Sirius ADRs through a broker or other securities intermediary
should contact the intermediary to determine the date by which such
intermediary must be instructed to act in order that the necessary
processing can be completed in time.
19 Disclosure of interests in Sirius
Save in respect of the irrevocable undertakings referred to in
paragraph 4 above and as disclosed below, as at the close of
business on 16 January 2020 (being the last practicable date prior
to the date of this announcement) neither Anglo American, nor any
of its directors, nor, so far as Anglo American is aware, any
person acting in concert (within the meaning of the Takeover Code)
with it has either (i) any interest in or right to subscribe for
any relevant securities of Sirius; (ii) any short position in
respect of relevant Sirius Shares (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) any dealing arrangement of the kind referred to in
Note 11 on the definition of acting in concert in the Takeover
Code, in relation to Sirius Shares or in relation to any securities
convertible or exchangeable into Sirius Shares; or (iv) borrowed or
lent any relevant Sirius Shares (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 shares
which had been either on-lent or sold:
Name Nature of Interest Number of Sirius
Shares
----------- -------------------- -----------------
Holder of ordinary
Ian Ashby shares 1,166,665
----------- -------------------- -----------------
"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 shall 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.
20 General
Anglo American and Bidco reserve the right to elect (with the
consent of the Panel and subject to the terms of the Co-operation
Agreement) to implement the Acquisition by way of a Takeover Offer
for the Sirius Shares not already directly or indirectly owned by
the Anglo American Parties as an alternative to the Scheme. In such
event, the Takeover Offer shall be implemented on the same terms,
so far as applicable, as those which would apply to the Scheme,
subject to appropriate amendments, including (without limitation)
an acceptance condition set at a level permitted by the Panel.
The Acquisition shall be made subject to the Conditions and
further terms set out in Appendix I to this announcement and to be
set out in the Scheme Document. The bases and sources of certain
financial information contained in this announcement are set out in
Appendix II to this announcement. A summary of the irrevocable
undertakings given in relation to the Acquisition is contained in
Appendix III to this announcement. Certain terms used in this
announcement are defined in Appendix IV to this announcement.
It is expected that the Scheme Document, containing further
information about the Acquisition and notices of the Court Meeting
and the General Meeting shall be sent to Sirius Shareholders within
28 days of this announcement and it is expected that the Scheme
will become Effective by 31 March 2020.
Centerview Partners, BofA Securities, J.P. Morgan Cazenove and
Lazard have each given and not withdrawn their consent to the
publication of this announcement with the inclusion herein of the
references to their names in the form and context in which they
appear.
21 Documents available on website
Copies of the following documents shall be made available on
Anglo American's and Sirius' websites at
www.angloamerican.com/offer and
www.siriusminerals.com/investors/firm-offer-from-anglo-american-plc
respectively until the Effective Date:
-- the irrevocable undertakings referred to in paragraph 4 above
and summarised in Appendix III to this announcement;
-- the Confidentiality Agreement referred to in paragraph 14 above;
-- the Co-operation Agreement referred to in paragraph 14 above;
-- the Hancock Waiver referred to in paragraph 11 above; and
-- the Waiver Side Letter referred to in paragraph 11 above.
Enquiries:
Anglo American
Media Investors
UK UK
James Wyatt-Tilby Paul Galloway
james.wyatt-tilby@angloamerican.com paul.galloway@angloamerican.com
Tel: +44 (0)20 7968 8759 Tel: +44 (0)20 7968 8718
Robert Greenberg
Marcelo Esquivel robert.greenberg@angloamerican.com
marcelo.esquivel@angloamerican.com Tel: +44 (0)20 7968 2124
Tel: +44 (0)20 7968 8891
Emma Waterworth
Katie Ryall emma.waterworth@angloamerican.com
katie.ryall@angloamerican.com Tel: +44 (0)20 7968 8574
Tel: +44 (0)20 7968 8935
South Africa
Pranill Ramchander
pranill.ramchander@angloamerican.com
Tel: +27 (0)11 638 2592
Sibusiso Tshabalala
sibusiso.tshabalala@angloamerican.com
Tel: +27 (0)11 638 2175
Bank of America Securities (Joint Financial Adviser to Anglo
American)
Ben Davies Tel: +44 (0) 20 7628
Geoff Iles 1000
Peter Surr
Ben Winstanley
Centerview Partners UK LLP (Joint Financial Adviser to Anglo
American)
James Hartop Tel: +44 (0) 20 7409
Edward Rowe 9700
Fiona McHardy
Brunswick (Anglo American's PR adviser)
Jonathan Glass Tel: +44 (0) 20 7404
Charles Pretzlik 5959
Sirius
Gareth Edmunds Tel: +44 (0) 8455 240
Tristan Pottas 247
J.P. Morgan Cazenove (Lead Financial
Adviser to Sirius)
Jamie Riddell Tel: +44 (0) 20 7742
James Robinson 4000
Andrey Zhvitiashvili
Jonty Edwards
Lazard & Co., Limited (Financial Adviser
to Sirius)
Spiro Youakim Tel: +44 (0) 20 7187
David Burlison 2000
Victoria Varga
Liberum Capital (Joint Broker to Sirius)
Tel: +44 (0) 20 3100
Clayton Bush 2000
Shore Capital (Joint Broker to Sirius)
Tel: +44 (0) 20 7408
Jerry Keen 4090
Edelman (Sirius' PR adviser)
Iain Dey Tel: +44 (0) 20 3047
Ed Brown 2268
John Kiely
Linklaters LLP are retained as legal adviser to Anglo American.
Allen & Overy LLP are retained as legal adviser to Sirius.
Anglo American LEI: 549300S9XF92D1X8ME43
Sirius LEI: 2138004ATVA9GVUAGA82
Shareholder helpline
If you have any questions in relation to the Acquisition please
contact Georgeson, a trading name of Computershare Investor
Services PLC, on 00 800 3742 6163 between the hours of 9.00 a.m.
and 5.00 p.m. Monday to Friday.
Please note, that for legal reasons, Georgeson will only be able
to provide you with information contained in this announcement and
will be unable to give advice on the merits of the Acquisition or
to provide legal, financial or taxation advice on the contents of
this announcement or the Acquisition.
Important Notices
Merrill Lynch International ("BofA Securities"), which is
authorised by the UK Prudential Regulation Authority and regulated
by the FCA and the UK Prudential Regulation Authority, is acting
exclusively for Anglo American and for no one else and will not be
responsible to anyone other than Anglo American for providing the
protections afforded to its clients or for providing advice in
relation to the matters referred to in this announcement. Neither
BofA Securities, 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 BofA Securities in connection
with this announcement, any statement contained herein or
otherwise.
Centerview Partners UK LLP ("Centerview Partners") is authorised
and regulated by the FCA. Centerview Partners is acting exclusively
for Anglo American and no one else in connection with the matters
referred to in this announcement. Centerview Partners is not and
will not be responsible to anyone other than Anglo American for
providing the protections afforded to its clients or for providing
advice in connection with the contents of this announcement or any
other matter referred to in this announcement. Neither Centerview
Partners, nor any of its affiliates, owes or accepts any duty,
liability or responsibility whatsoever to any person who is not a
client of Centerview Partners in connection with this announcement,
any statement contained herein or otherwise.
J.P. Morgan Securities plc, which conducts its UK investment
banking business as J.P. Morgan Cazenove ("J.P. Morgan Cazenove"),
is authorised in the United Kingdom by the Prudential Regulation
Authority and regulated in the United Kingdom by the Prudential
Regulation Authority and the FCA. J.P. Morgan Cazenove is acting as
financial adviser exclusively for Sirius and no one else in
connection with the matters set out in this announcement and will
not regard any other person as its client in relation to the
matters in this announcement and will not be responsible to anyone
other than Sirius for providing the protections afforded to clients
of J.P. Morgan Cazenove, or for providing advice in relation to any
matter referred to herein.
Lazard & Co., Limited ("Lazard"), which is authorised and
regulated by the FCA in the United Kingdom, is acting exclusively
for Sirius and for no one else and will not be responsible to
anyone other than Sirius for providing the protections afforded to
its clients or for providing advice in connection with the matters
set out in this announcement. Neither Lazard 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 Lazard in connection with this announcement, any statement
contained herein, the transaction described herein or
otherwise.
Liberum Capital Limited ("Liberum Capital"), which is authorised
and regulated in the United Kingdom by the FCA, is acting as joint
broker exclusively for Sirius and for no one else in connection
with the matters set out in this announcement and will not regard
any other person as its client in relation to the matters in this
announcement and will not be responsible to anyone other than
Sirius for providing the protections afforded to clients of Liberum
Capital, or for providing advice in relation to any matter referred
to herein.
Shore Capital Stockbrokers Limited ("Shore Capital"), which is
authorised and regulated in the United Kingdom by the FCA, is
acting as joint broker exclusively for Sirius and no one else in
connection with the matters set out in this announcement and will
not regard any other person as its client in relation to the
matters in this announcement and will not be responsible to anyone
other than Sirius for providing the protections afforded to clients
of Shore Capital, or for providing advice in relation to any matter
referred to herein.
This announcement is for information purposes only and does not
constitute an offer to sell or an invitation to purchase any
securities or the solicitation of an offer to buy any securities,
pursuant to the Acquisition or otherwise.
The Acquisition shall be made solely by means of the Scheme
Document which shall contain the full terms and conditions of the
Acquisition, including details of how to vote in respect of the
Acquisition.
This announcement has been prepared for the purpose of complying
with the laws of England and Wales and the Takeover Code and the
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 England and Wales.
Sirius shall prepare the Scheme Document to be distributed to
Sirius Shareholders. Sirius and Anglo American urge Sirius
Shareholders to read the Scheme Document when it becomes available
because it shall contain important information relating to the
Acquisition.
This announcement does not constitute a prospectus or prospectus
exempted document.
Overseas Shareholders
The release, publication or distribution of this announcement in
or into certain jurisdictions other than the United Kingdom or the
United States may be restricted by law. Persons who are not
resident in the United Kingdom or the United States or who are
subject to other jurisdictions should inform themselves of, and
observe, any applicable requirements.
Unless otherwise determined by Anglo American or required by the
Takeover Code, and permitted by applicable law and regulation, the
Acquisition shall not be made available, directly or indirectly,
in, into or from a Restricted Jurisdiction where to do so would
violate the laws in that jurisdiction and no person may vote in
favour of the Acquisition by any such use, means, instrumentality
or form within a Restricted Jurisdiction or any other jurisdiction
if to do so would constitute a violation of the laws of that
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
where to do so would violate the laws in that 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
jurisdictions where to do so would violate the laws in that
jurisdiction.
The availability of the Acquisition to Sirius Shareholders who
are not resident in the United Kingdom (and, in particular, their
ability to vote their Sirius Shares with respect to the Scheme at
the Court Meeting, or to appoint another person as proxy to vote at
the Court Meeting on their behalf) may be affected by the laws of
the relevant jurisdictions in which they are resident. Persons who
are not resident in the United Kingdom should inform themselves of,
and observe, any applicable requirements, as any failure to comply
with the requirements 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.
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 shares of a UK company and is
proposed to be effected by means of a scheme of arrangement under
the laws of England and Wales. A transaction effected by means of a
scheme of arrangement is not subject to the tender offer rules or
the proxy solicitation rules under the US Exchange Act.
Accordingly, the Acquisition is subject to the disclosure and
procedural requirements applicable in the United Kingdom to schemes
of arrangement which differ from the disclosure requirements of
United States tender offer and proxy solicitation rules.
Neither the US Securities and Exchange Commission nor any US
state securities commission has approved or disproved or passed
judgment upon the fairness or the merits of the Acquisition or
determined if this announcement is adequate, accurate or complete.
Any representation to the contrary is a criminal offence in the
US.
However, if Anglo American were to elect to implement the
Acquisition by means of a takeover offer, such takeover offer shall
be made in compliance with all applicable United States laws and
regulations, including any applicable exemptions under the US
Exchange Act. Such a takeover would be made in the United States by
Anglo American and no one else.
In the event that the Acquisition is implemented by way of a
Takeover Offer, in accordance with normal United Kingdom practice
and pursuant to Rule 14e-5(b) of the US Exchange Act, Anglo
American 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 Sirius outside of the US,
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 in the UK, shall be reported to a Regulatory
Information Service and shall be available on the London Stock
Exchange website at www.londonstockexchange.com.
The receipt of consideration by a US holder for the transfer of
its Sirius Shares pursuant to the Scheme shall be a taxable
transaction for United States federal income tax purposes. Each
Sirius Shareholder is urged to consult their independent
professional adviser immediately regarding the tax consequences of
the Acquisition applicable to them, including under applicable
United States state and local, as well as overseas and other, tax
laws.
Financial information relating to Sirius included in this
announcement and the Scheme Document has been or shall have been
prepared in accordance with accounting standards applicable in the
United Kingdom and 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 United States.
Anglo American, Bidco and Sirius are each organised under the
laws of England and Wales. Some or all of the officers and
directors of Anglo American, Bidco and Sirius, respectively, are
residents of countries other than the United States. As a result,
it may be difficult for US Sirius Shareholders to effect service of
process within the United States upon Anglo American, Bidco or
Sirius or their respective officers or directors or to enforce
against them a judgment of a US court predicated upon the federal
or state securities laws of the United Kingdom.
Forward looking statements
This announcement (including information incorporated by
reference in this announcement), oral statements made regarding the
Acquisition, and other information published by Sirius, Anglo
American or any member of the Anglo American Group contain
statements which are, or may be deemed to be, "forward-looking
statements". Such forward-looking statements are prospective in
nature and are not based on historical facts, but rather on current
expectations and on numerous assumptions regarding the business
strategies and the environment in which Anglo American, any member
of the Anglo American Group or the Enlarged Group shall operate in
the future and are subject to risks and uncertainties that could
cause actual results to differ materially from those expressed or
implied by those statements.
The forward-looking statements contained in this announcement
relate to Anglo American, any member of the Anglo American Group or
the Enlarged Group's future prospects, developments and business
strategies, the expected timing and scope of the Acquisition and
other statements other than historical facts. In some cases, these
forward-looking statements can be identified by the use of forward
looking terminology, including the terms "believes", "estimates",
"will look to", "would look to", "plans", "prepares",
"anticipates", "expects", "is expected to", "is subject to",
"budget", "scheduled", "forecasts", "synergy", "strategy", "goal",
"cost-saving", "projects", "intends", "may", "will", "shall" or
"should" or their negatives or other variations or comparable
terminology. Forward-looking statements may 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 Anglo American's, any member of the Anglo
American Group's or Sirius' operations and potential synergies
resulting from the Acquisition; and (iii) the effects of global
economic conditions and governmental regulation on Anglo
American's, any member of the Anglo American Group's or Sirius'
business.
By their nature, forward-looking statements involve risk and
uncertainty because they relate to events and depend on
circumstances that shall occur in the future. These events and
circumstances include changes in the global, political, economic,
business, competitive, market and regulatory forces, future
exchange and interest rates, changes in tax rates and future
business combinations or disposals. If any one or more of these
risks or uncertainties materialises or if any one or more of the
assumptions proves incorrect, actual results may differ materially
from those expected, estimated or projected. Such forward-looking
statements should therefore be construed in the light of such
factors.
Neither Sirius nor any of Anglo American nor any member of the
Anglo American Group, 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
shall actually occur. Given these risks and uncertainties,
potential investors should not place any reliance on
forward-looking statements.
The forward-looking statements speak only at the date of this
announcement. All subsequent oral or written forward-looking
statements attributable to any member of the Anglo American Group
or Sirius Group, or any of their respective associates, directors,
officers, employees or advisers, are expressly qualified in their
entirety by the cautionary statement above.
Sirius and Anglo American expressly disclaim any obligation to
update such statements other than as required by 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 estimates
No statement in this announcement is intended as a profit
forecast or estimate for any period and no statement in this
announcement should be interpreted to mean that earnings or
earnings per share for Anglo American or Sirius, as appropriate,
for the current or future financial years would necessarily match
or exceed the historical published earnings or earnings per share
for Anglo American or Sirius, as appropriate.
Disclosure requirements of the Takeover Code
Under Rule 8.3(a) of the Takeover Code, any person who is
interested in 1 per cent. 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 per cent. 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,
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 shall 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 http://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. If you are in any doubt as to whether you are required
to make an Opening Position Disclosure or a Dealing Disclosure, you
should contact the Panel's Market Surveillance Unit on +44 (0)20
7638 0129.
Electronic communications
Please be aware that addresses, electronic addresses and certain
information provided by Sirius Shareholders, persons with
information rights and other relevant persons for the receipt of
communications from Sirius may be provided to Anglo American during
the Offer Period as requested under Section 4 of Appendix 4 of the
Takeover Code to comply with Rule 2.11(c) of the Takeover Code.
Publication on website and availability of hard copies
A copy of this announcement shall be made available, subject to
certain restrictions relating to persons resident in Restricted
Jurisdictions, on Anglo American's and Sirius' websites at
www.angloamerican.com/offer and
www.siriusminerals.com/investors/firm-offer-from-anglo-american-plc
respectively by no later than 12 noon (London time) on the Business
Day following the publication of this announcement. For the
avoidance of doubt, the contents of these websites are not
incorporated into and do not form part of this announcement.
You may request a hard copy of this announcement by contacting
Sirius' registrars, Link Asset Services, during business hours on
0871 664 0300 (or +44(0) 371 664 0300 from abroad) or at The
Registry, 34 Beckenham Road, Beckenham, Kent, BR3 4TU. You may also
request that all future documents, announcements and information to
be sent to you in relation to the Acquisition should be 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.
Rule 2.9 Disclosure
In accordance with Rule 2.9 of the Takeover Code, Sirius
confirms that as at the date of this announcement, it has in issue
and admitted to trading on the Main Market of the London Stock
Exchange, 7,020,196,560 ordinary shares of 0.25 pence each (no
ordinary shares are held in treasury). The International Securities
Identification Number (ISIN) of the ordinary shares is
GB00B0DG3H29.
Sirius has an American depositary receipts ("ADR") program
comprising 30,229 ADRs, for which Deutsche Bank Trust Company
Americas acts as depositary. These ADRs represent 1,511,450
ordinary shares of Sirius. The ADRs are traded over-the-counter.
The trading symbol for the ADR securities is SRUXY and the ISIN is
US82967P1030.
In addition, the Sirius Group has US$236,600,000 convertible
bonds outstanding. These bonds are convertible into Sirius ordinary
shares and comprise two series: (i) US$137,600,000 8.5 per cent.
convertible bonds due 2023 (ISIN code: XS1515223516); and (ii)
US$99,000,000 5.0 per cent. convertible bonds due 2027 (ISIN code:
XS1991118255).
APPIX I
CONDITIONS AND FURTHER TERMS OF THE ACQUISITION
Part A: Conditions of the Scheme and the Acquisition
1 The Acquisition is conditional upon the Scheme becoming
unconditional and effective, subject to the Takeover Code, by not
later than the Long Stop Date.
2 The Scheme shall be subject to the following conditions:
2.1
(i) its approval by a majority in number of the Sirius
Shareholders who are present and vote, whether in person or by
proxy, at the Court Meeting and who represent 75 per cent. or more
in value of the Sirius Shares voted by those Sirius Shareholders;
and
(ii) such Court Meeting being held on or before the 22(nd) day
after 5 March 2020 (or such later date as may be agreed by Anglo
American and Sirius and, if required, the Court may allow);
2.2
(i) the resolutions required to implement the Scheme being duly
passed by Sirius Shareholders representing 75 per cent. or more of
votes cast at the General Meeting; and
(ii) such General Meeting being held on or before the 22(nd) day
after 5 March 2020 (or such later date as may be agreed by Anglo
American and Sirius and, if required, the Court may allow);
2.3
(i) the sanction of the Scheme by the Court (with or without
modification but subject to any modification being on terms
acceptable to Sirius and Anglo American) and the delivery of a copy
of the Court Order to the Registrar of Companies; and
(ii) the Court Sanction Hearing being held on or before the
22(nd) day after 8 April 2020 or, if CADE do not consider that the
application form is eligible for the fast-track review procedure,
the 22(nd) day after 27 May 2020 (or such later date as may be
agreed by Anglo American and Sirius and, if required, the Court may
allow);
3 In addition, subject to the requirements of the Panel, the
Acquisition shall be conditional upon the following Conditions and,
accordingly, the Court Order shall not be delivered to the
Registrar of Companies unless such Conditions (as amended if
appropriate) have been satisfied or, where relevant, waived:
Brazilian Competition Authorities clearance
(a) CADE having approved the consummation of the Acquisition
unconditionally pursuant to the Brazilian competition law No 12529
of 30 November 2011 and CADE's Internal Regiment (approved by CADE
Regulation No. 22 of 19 June 2019), or, if approved with
conditions, on such conditions as are reasonably satisfactory to
Anglo American;
Notifications, waiting periods and Authorisations
(b) other than in respect of Condition 3(a), all material
notifications, filings or applications which are necessary having
been made in connection with the Acquisition and all necessary
waiting 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 and regulatory obligations in any jurisdiction having
been complied with in each case in respect of the Acquisition and
all Authorisations deemed reasonably necessary by Anglo American in
any jurisdiction and, except pursuant to Chapter 3 of Part 28 of
the Companies Act, in respect of the Acquisition having been
obtained in terms and in a form reasonably satisfactory to Anglo
American from all appropriate Relevant Authorities and all such
Authorisations remaining in full force and effect at the time at
which the Acquisition becomes otherwise wholly unconditional and
there being no notice or intimation of an intention to revoke,
suspend, restrict, modify or not to renew such Authorisations, in
each case in any way that would be materially adverse to the Wider
Sirius Group;
General antitrust and regulatory
(c) other than in respect of Condition 3(a), no antitrust
regulator or Relevant Authority having given notice of a decision
to take, institute or implement 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 would reasonably be expected to,
in any case to an extent or in a manner which is or would be
material in the context of the Wider Sirius Group taken as a
whole:
(i) require, prevent or materially delay the divestiture or
materially alter the terms envisaged for such divestiture by any
member of the Wider Anglo American Group or by any member of the
Wider Sirius Group of all or any material 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);
(ii) except pursuant to Chapter 3 of Part 28 of the Companies
Act, require any member of the Wider Anglo American Group or the
Wider Sirius Group to acquire or offer to acquire any shares, other
securities (or the equivalent) or interest in any member of the
Wider Sirius Group or any asset owned by any Third Party (other
than in the implementation of the Acquisition);
(iii) impose any material limitation on, or result in a material
delay in, the ability of any member of the Wider Anglo American
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 Sirius or on the ability of any member of the
Wider Sirius Group or any member of the Wider Anglo American Group
directly or indirectly to hold or exercise effectively all or any
rights of ownership in respect of shares or other securities (or
the equivalent) in, or to exercise voting or management control
over, any member of the Wider Sirius Group;
(iv) otherwise adversely affect any or all of the business,
assets or profits of the Wider Sirius Group or the Wider Anglo
American Group;
(v) result in any member of the Wider Sirius Group or any member
of the Wider Anglo American Group ceasing to be able to carry on
business under any name under which it presently carries on
business;
(vi) make the Acquisition or its implementation void,
unenforceable and/or illegal under the laws of any relevant
jurisdiction, or otherwise, directly or indirectly materially
prevent or prohibit, restrict, restrain, or delay or otherwise to a
material extent or otherwise materially interfere with the
implementation of, or impose material additional conditions or
obligations with respect to, or otherwise materially challenge,
impede, interfere or require material amendment of the
Acquisition;
(vii) require, prevent or materially delay a divestiture by any
member of the Wider Anglo American Group of any shares or other
securities (or the equivalent) in any member of the Wider Sirius
Group or any member of the Wider Anglo American Group; or
(viii) impose any material limitation on the ability of any
member of the Wider Anglo American Group of any member of the Wider
Sirius 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 Anglo American Group and/or the Wider Sirius
Group,
and all applicable waiting and other time periods (including any
extensions thereof) during which any such antitrust regulator or
Relevant Authority could decide to take, institute or implement 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 or proposed
acquisition of any Sirius Shares or otherwise intervene having
expired, lapsed or been terminated;
Certain matters arising as a result of any arrangement,
agreement, etc.
(d) 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 Sirius 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 would or would be reasonably
expected to result in, in each case to an extent which is material
in the context of the Wider Sirius Group taken as a whole:
(i) any monies borrowed by, or any other indebtedness, actual or
contingent, of, or any grant available to, any member of the Wider
Sirius 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 creation or enforcement of any mortgage, charge or
other security interest over the whole or any material part of the
business, property or assets of any member of the Wider Sirius
Group or any such mortgage, charge or other security interest
(whenever created, arising or having arisen) becoming
enforceable;
(iii) any such arrangement, agreement, lease, licence,
franchise, permit or other instrument being terminated or the
rights, liabilities, obligations or interests of any member of the
Wider Sirius Group being adversely modified or adversely affected
or any obligation or liability arising or any adverse action being
taken or arising thereunder;
(iv) any liability of any member of the Wider Sirius Group to
make any severance, termination, bonus or other payment to any of
its directors, or other officers;
(v) the rights, liabilities, obligations, interests or business
of any member of the Wider Sirius Group under any arrangement,
agreement, licence, permit, lease or instrument or the interests or
business of any member of the Wider Sirius Group or with any other
person or body or firm or company (or any arrangement 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
adverse action being taken thereunder;
(vi) any member of the Wider Sirius Group ceasing to be able to
carry on business under any name under which it presently carries
on business;
(vii) the value of, or the financial or trading position of, any
member of the Wider Sirius Group being prejudiced or adversely
affected; or
(viii) the creation or acceleration of any liability (actual or
contingent) by any member of the Wider Sirius Group other than
liabilities incurred in the ordinary course of business,
and, except as Disclosed, 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 Sirius Group is a party or by or to which any such member or
any of its assets are bound or subject, would result in any of the
events or circumstances as are referred to in Conditions 3(d)(i) to
(viii), in each case to the extent material in the context of the
Wider Sirius Group taken as a whole;
Certain events occurring since 30 June 2019
(e) except as Disclosed, no member of the Wider Sirius Group having since 30 June 2019:
(i) 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 Sirius
Shares out of treasury (except, where relevant, as between Sirius
and wholly owned subsidiaries of Sirius or between the wholly owned
subsidiaries of Sirius and except for the issue or transfer out of
treasury of Sirius Shares on the exercise of employee share options
or vesting of employee share awards in the ordinary course under
the Sirius Share Plans);
(ii) recommended, declared, paid or made or proposed to
recommend, declare, pay or make any dividend, distribution or other
return of value (whether payable in cash or otherwise) other than
dividends (or distributions or other return of value whether
payable in cash or otherwise) lawfully paid or made by any wholly
owned subsidiary of Sirius to Sirius or any of its wholly owned
subsidiaries;
(iii) other than pursuant to the Acquisition (and except for
transactions between Sirius and its wholly owned subsidiaries or
between the wholly owned subsidiaries of Sirius 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 acquisition or disposal of
assets or shares or loan capital (or the equivalent thereof) in any
undertaking or undertakings in any such case to an extent which is
material in the context of the Wider Sirius Group taken as a
whole;
(iv) except for transactions between Sirius and its wholly owned
subsidiaries or between the wholly owned subsidiaries of Sirius,
disposed of, or transferred, mortgaged or created any security
interest over any material asset or any right, title or interest in
any material asset or authorised, proposed or announced any
intention to do so;
(v) except for transactions between Sirius and its wholly owned
subsidiaries or between the wholly owned subsidiaries of Sirius,
issued, authorised or proposed or announced an intention to
authorise or propose, the issue of or made any change in or to the
terms of any debentures or become subject to any contingent
liability or incurred or increased any indebtedness which is
material in the context of the Wider Sirius Group as a whole;
(vi) entered into or varied or authorised, proposed or announced
its intention to enter into or vary any material contract,
arrangement, agreement, transaction or commitment (whether in
respect of capital expenditure or otherwise) which is of a
long-term, unusual or onerous nature or magnitude or which is or
which involves or could involve an obligation of a nature or
magnitude which is reasonably likely to be materially restrictive
on the business of any member of the Wider Sirius Group;
(vii) entered into or varied the terms of, or made any offer
(which remains open for acceptance) to enter into or vary to a
material extent the terms of, any contract, service agreement,
commitment or arrangement with any director or senior executive of
any member of the Wider Sirius Group, except for, in each case,
salary increases, bonuses or variations of terms consistent with
past practice or as contemplated in the Co-operation Agreement;
(viii) 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 Sirius Group, other than as contemplated in the Co-operation
Agreement;
(ix) 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;
(x) waived, compromised or settled any claim which is material
in the context of the Wider Sirius Group as a whole;
(xi) terminated or varied the terms of any agreement or
arrangement between any member of the Wider Sirius Group and any
other person in a manner which has had or would reasonably be
expected to have a material adverse effect on the financial
position of the Wider Sirius Group taken as a whole;
(xii) made any material alteration to its memorandum or articles
of association or other incorporation documents;
(xiii) 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 significant change to:
A. the terms of the trust deeds and rules constituting the
pension scheme(s) established by any member of the Wider Sirius
Group for its directors, employees or their dependants;
B. the contributions payable to any such scheme(s) 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
such pension schemes are funded, valued, made, agreed or consented
to;
(xiv) been unable, or deemed unable for the purposes of any
applicable law, 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 in
writing to stop or suspend) payment of its debts generally or
ceased or threatened in writing to cease carrying on all or a
substantial part of its business;
(xv) (other than in respect of a member of the Wider Sirius
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 in writing 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, controller, liquidator
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;
(xvi) except for transactions between Sirius and its wholly
owned subsidiaries or between the wholly owned subsidiaries of
Sirius, made, authorised, proposed or announced an intention to
propose any change in its loan capital;
(xvii) entered into, implemented or authorised the entry into,
any joint venture, asset or profit sharing arrangement, partnership
or merger of business or corporate entities, save with another
member of the Wider Sirius Group;
(xviii) having taken (or agreed or proposed to take) any action
which requires or would require, the consent of the Panel or the
approval of Sirius Shareholders in general meeting in accordance
with, or as contemplated by, Rule 21.2 of the Takeover Code; or
(xix) 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(e), having regard to all carve
outs, exclusions and limitations contained in this Condition 3(e)
to the extent applicable to such transaction, matter or event;
No adverse change, litigation, regulatory enquiry or similar
(f) except as Disclosed, since 30 June 2019, there having been:
(i) no adverse change and no circumstance having arisen which
would result in any adverse change in, the business, assets,
financial or trading position or profits or operational performance
of any member of the Wider Sirius Group which is material in the
context of the Wider Sirius Group taken as a whole;
(ii) no litigation, arbitration proceedings, prosecution or
other legal proceedings having been threatened in writing,
announced or instituted by or against or remaining outstanding
against or in respect of, any member of the Wider Sirius Group or
to which any member of the Wider Sirius Group is a party (whether
as claimant, defendant or otherwise) having been threatened in
writing, announced, instituted or remaining outstanding by, against
or in respect of, any member of the Wider Sirius Group which, in
each case, would have a material adverse effect on the Wider Sirius
Group taken as a whole;
(iii) no investigation by any Relevant Authority against or in
respect of any member of the Wider Sirius Group having been
threatened in writing, announced or instituted or remaining
outstanding by, against or in respect of any member of the Wider
Sirius Group;
(iv) no contingent or other liability having arisen or increased
other than in the ordinary course of business which would affect
adversely the business, assets, financial or trading position or
profits of any member of the Wider Sirius Group to an extent which
would be material in the context of the Wider Sirius Group taken as
a whole; and
(v) no steps having been taken and no omissions having been made
which would result in the withdrawal, cancellation, termination or
modification of any licence held by any member of the Wider Sirius
Group which is necessary for the proper carrying on of its business
and the withdrawal, cancellation, termination or modification of
which would have a material adverse effect on the Wider Sirius
Group taken as a whole;
No discovery of certain matters regarding information,
liabilities and environmental issues
(g) except as Disclosed, Anglo American not informing Sirius in
writing that it has discovered, and, in each case to an extent
which is material in the context of the Wider Sirius Group taken as
a whole, that:
(i) any financial, business or other information concerning the
Wider Sirius Group publicly announced prior to the date of this
announcement is misleading, contains a material misrepresentation
of any fact, or omits to state a fact necessary to make that
information not misleading;
(ii) any past or present member of the Wider Sirius Group has
not complied in any material respect with all 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 health or
otherwise relating to environmental matters or the health and
safety of humans, which non-compliance would 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 Sirius Group;
(iii) there has been a material disposal, discharge, spillage,
accumulation, release, leak, emission or the migration, production,
supply, treatment, storage, transport or use of any waste or
hazardous substance or any substance likely to impair the
environment (including any property) or harm human health which
(whether or not giving rise to non-compliance with any law or
regulation) would give rise to any material liability (whether
actual or contingent) on the part of any member of the Wider Sirius
Group;
(iv) there is any material 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 or present member of the Wider
Sirius Group (or on its behalf), or in which any such member has or
previously has had or be deemed to have had an interest, under any
environmental legislation, common law, regulation, notice,
circular, Authorisation or order of any Relevant Authority in any
jurisdiction or to contribute to the cost thereof or associated
therewith or indemnify any person in relation thereto; or
(v) circumstances exist (whether as a result of making the
Acquisition or otherwise) which would lead to any Relevant
Authority instituting (or whereby any member of the Wider Sirius
Group would be required to institute), an environment audit or take
any steps which would in any such case 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 or present member of the Wider Sirius Group (or
on its behalf) or by any person for which a member of the Wider
Sirius 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;
Anti-corruption
(vi) any member of the Wider Sirius Group or any person that
performs or has performed services for or on behalf of any such
company is or has engaged in any activity, practice or conduct
which would constitute an offence under the Bribery Act 2010 or any
other applicable anti-corruption legislation; or
(vii) any member of the Wider Sirius Group is ineligible to be
awarded any contract or business under section 23 of the Public
Contracts Regulations 2006 or section 26 of the Utilities Contracts
Regulations (2006) (each as amended); or
(viii) any member of the Wider Sirius Group has engaged in any
transaction which would cause any member of the Wider Anglo
American Group to be in breach of applicable law or regulation upon
completion of the Acquisition in relation to the 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,
United States or the European Union or any of its member states;
or
No criminal property
(ix) any asset of any member of the Wider Sirius Group
constitutes criminal property as defined by section 340(3) of the
Proceeds of Crime Act 2002 (but disregarding paragraph (b) of that
definition).
Part B: Certain further terms of the Acquisition
1 Subject to the requirements of the Panel, Anglo American reserves the right to waive:
(a) the deadline set out in Condition 1, subject to the
agreement of Anglo American and Sirius, and any of the deadlines
set out in Condition 2 for the timing of the Court Meeting, General
Meeting and the Court Sanction Hearing. If any such deadline is not
met, Anglo American shall make an announcement by 8.00 a.m. on the
Business Day following such deadline confirming whether it has
invoked or waived the relevant Condition or agreed with Sirius to
extend the deadline in relation to the relevant Condition; and
(b) in whole or in part, all or any of the above Conditions 3(a) to (g) (inclusive).
2 If Anglo American is required by the Panel to make an offer
for Sirius Shares under the provisions of Rule 9 of the Takeover
Code, Anglo American may make such alterations to any of the above
Conditions and terms of the Acquisition as are necessary to comply
with the provisions of that Rule.
3 The Scheme and the Acquisition shall not become Effective if:
(a) in so far as the Acquisition or any matter arising from or
relating to the Scheme or Acquisition constitutes a concentration
with a Community dimension within the scope of the Regulation, the
European Commission either initiates proceedings under Article
6(1)(c) of the Regulation or makes a referral to a competent
authority in the United Kingdom under Article 9(1) of the
Regulation and there is then a CMA Phase 2 Reference; or
(b) the Acquisition or any matter arising from or relating to
the Scheme or Acquisition becomes subject to a CMA Phase 2
Reference,
in each case, before the date of the Court Meeting.
4 Other than as required under the terms of the Co-operation
Agreement, Anglo American shall be under no obligation to waive (if
capable of waiver), to determine to be or remain satisfied or to
treat as fulfilled any of Conditions 3(a) to (g) (inclusive) by a
date earlier than the latest date for the fulfilment of that
Condition notwithstanding that the other Conditions of the
Acquisition 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.
5 The Sirius Shares acquired under the Acquisition shall be
acquired 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 (subject to paragraph 6
below) the right to receive and retain in full all dividends and
other distributions (if any) declared, made or paid, or any other
return of value (whether by reduction of share capital or share
premium account or otherwise) made, on or after the date of this
announcement.
6 If, on or after the date of this announcement and prior to or
on the Effective Date, any dividend, distribution or other return
of value is declared, paid or made or becomes payable by Sirius and
with a record date on or prior to the Effective Date, Anglo
American reserves the right (without prejudice to any right of
Anglo American, with the consent of the Panel, to invoke Condition
3(e)(ii) of this Appendix I) to reduce the consideration payable
under the Acquisition to reflect the aggregate amount of such
dividend, distribution or other return of value. In such
circumstances, Sirius Shareholders would be entitled to retain any
such dividend, distribution or other return of value declared, made
or paid.
If and to the extent that any such dividend, distribution or
other return of value is paid or made on or prior to the Effective
Date, and Anglo American exercises its rights under this paragraph
6 to reduce the consideration payable under the Acquisition, any
reference in this announcement to the consideration payable under
the terms of the Acquisition shall be deemed to be a reference to
the consideration as so reduced.
If and to the extent that any such dividend, distribution or
other return of value has been declared or announced but not paid
or made or is not payable by reference to a record date on or prior
to the Effective Date or shall be (i) transferred pursuant to the
Acquisition on a basis which entitles Anglo American to receive the
dividend, distribution or other return of value and to retain it;
or (ii) cancelled, the consideration payable under the terms of the
Acquisition shall not be subject to change in accordance with this
paragraph 6.
Any exercise by Anglo American of its rights referred to in this
paragraph 6 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.
7 Anglo American and Bidco reserve the right to elect (with the
consent of the Panel and subject to the Co-operation Agreement) to
implement the Acquisition by way of a Takeover Offer for the Sirius
Shares as an alternative to the Scheme. In such event, the Takeover
Offer shall be implemented on the same terms, so far as applicable,
as those which would apply to the Scheme, subject to appropriate
amendments, including (without limitation) an acceptance condition
set at a level permitted by the Panel and the Co-operation
Agreement.
8 The availability of the Acquisition 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
requirements.
9 The Acquisition 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 jurisdiction where to do so would
violate the laws of that jurisdiction.
10 The Acquisition is governed by the law of England and Wales
and is subject to the jurisdiction of the English courts and to the
Conditions and further terms set out in this Appendix I and to be
set out in the Scheme Document. The Acquisition shall be subject to
the applicable requirements of the Takeover Code, the Panel, the
London Stock Exchange and the Financial Conduct Authority.
11 Under Rule 13.5(a) of the Takeover Code, Anglo American may
not invoke a Condition to the Acquisition so as to cause the
Acquisition not to proceed, to lapse or to be withdrawn unless the
circumstances which give rise to the right to invoke the Condition
are of material significance to Anglo American in the context of
the Acquisition. Condition 2 of Part A of Appendix I and, if
applicable, any acceptance condition if the Acquisition is
implemented by means of a Takeover Offer, are not subject to this
provision of the Takeover Code.
12 Each of the Conditions shall be regarded as a separate
Condition and shall not be limited by reference to any other
Condition.
APPIX II
SOURCES OF INFORMATION AND BASES OF CALCULATION
Unless otherwise stated in this announcement:
1. As at 16 January 2020 (being the latest practicable date
prior to publication of this announcement), there were
7,020,196,560 Sirius Shares in issue. The International Securities
Identification Number for Sirius Shares is GB00B0DG3H29.
2. Any references to the issued and to be issued share capital of Sirius are based on:
(i) the issued share capital of 7,020,196,560 Sirius Shares
referred to in paragraph 1 above; plus
(ii) 341,152,599 Sirius Shares which may be issued on or after
the date of this announcement to satisfy the exercise of options or
vesting of awards pursuant to the Sirius Share Plans.
3. The value of the Acquisition based on the Offer Price of 5.50
pence per Sirius Share is calculated on the basis of the issued and
to be issued share capital of Sirius (as set out in paragraph 2
above).
4. Based on current available market data as at 16 January 2020
(being the latest practicable date prior to publication of this
announcement) and various other assumptions, including that all
Convertible Bondholders will convert their Convertible Bonds during
the 60-day change of control period, Anglo American will be
required to cash out Convertible Bondholders, at the Offer Price,
in respect of a total of approximately 1,053,506,079 Sirius Shares.
This figure is illustrative only and the actual figure will depend,
inter alia, on market data as at the Effective Date.
5. All Closing Prices referred to in this announcement are taken
from the Daily Official List.
6. Unless otherwise stated, the financial information relating
to Sirius is extracted from the audited consolidated financial
statements of Sirius for the financial year to 31 December 2018,
prepared in accordance with IFRS.
7. The financial information relating to Anglo American is
extracted from the audited consolidated financial statements of
Anglo American for the year ended 31 December 2018, prepared in
accordance with IFRS.
APPIX III
IRREVOCABLE UNDERTAKINGS
The following Sirius Directors have given irrevocable
undertakings to vote in favour of the Scheme at the Court Meeting
and the resolutions to be proposed at the General Meeting:
Number of Sirius Shares
Name of Sirius in respect of which undertaking Percentage of Sirius
Director is given issued share capital*
R Scrimshaw 45,645,005 0.65
--------------------------------- -----------------------
C Fraser 123,997,368 1.77
--------------------------------- -----------------------
T Staley 1,187,139 0.02
--------------------------------- -----------------------
J Hutton 30,856 0.00
--------------------------------- -----------------------
J Lodge 601,822 0.01
--------------------------------- -----------------------
E N Harwerth 101,303 0.00
--------------------------------- -----------------------
K Clarke 899,144 0.01
--------------------------------- -----------------------
L Hardy 0 0.00
--------------------------------- -----------------------
TOTAL 172,462,637 2.46%
--------------------------------- -----------------------
*based on the number of Sirius Shares in issue on 16 January
2020 (being the last practicable date prior to the publication of
this announcement)
The obligations of the Sirius Directors under the irrevocable
undertakings shall lapse and cease to have effect on and from the
following occurrences:
-- Bidco announces, with the consent of the Panel and before the
Scheme Document is published, that it does not intend to proceed
with the Acquisition and no new, revised or replacement Scheme is
announced by Bidco;
-- the Scheme is withdrawn or lapses, provided that this shall
not apply if the lapse or withdrawal either is not confirmed by
Bidco or a new, revised or replacement scheme of arrangement is
announced by Bidco (or a person acting in concert with it) within
five business days after any such lapse or withdrawal; or
-- Anglo American and/or Bidco elect to implement the
Acquisition by way of a Takeover Offer (rather than a Scheme).
These irrevocable undertakings remain binding in the event of a
competing offer.
APPIX IV
DEFINITIONS
The following definitions apply throughout this announcement
unless the context requires otherwise:
Acquisition the recommended cash acquisition being
made by Anglo American to acquire
directly or indirectly the entire
issued and to be issued share capital
of Sirius not already directly or
indirectly held by the Anglo American
Parties (or by way of Takeover Offer
under certain circumstances described
in this announcement) to be effected
by means of the Scheme and, where
the context admits, any subsequent
revision, variation, extension or
renewal thereof
Anglo American Anglo American plc
Anglo American Group Anglo American and its subsidiary
undertakings and, where the context
permits, each of them
Anglo American Parties Bidco, Anglo American and those persons
disclosed in paragraph 19 of this
announcement
Authorisations regulatory authorisations, orders,
recognitions, grants, consents, clearances,
confirmations, certificates, licences,
permissions or approvals
Bidco Anglo American Projects UK Limited,
a company incorporated in England
& Wales with company number 12366241
whose, registered office is at 20
Carlton House Terrace, London, United
Kingdom SW1Y 5AN
BofA Securities Merrill Lynch International
Business Day a day (other than Saturdays, Sundays
and public holidays in the UK) on
which banks are open for business
in London
CADE Brazil's Council for Economic Defence
and its entities
Centerview Partners Centerview Partners UK LLP
Clearances any approvals, consents, clearances,
permissions, confirmations and waivers
that are required to be obtained and
waiting periods that may need to have
expired, from or under any of the
laws, regulations or practices applied
by any Relevant Authority in connection
with the implementation of the Acquisition
Closing Price the closing middle market price of
a Sirius Share on a particular trading
day as derived from the Daily Official
List
CMA Phase 2 Reference a reference of the Acquisition to
the chair of the Competition and Markets
Authority for the constitution of
a group under Schedule 4 to the Enterprise
and Regulatory Reform Act 2013
Companies Act the Companies Act 2006, as amended
Conditions the conditions to the implementation
of the Acquisition, as set out in
Appendix I to this announcement and
to be set out in the Scheme Document
Confidentiality Agreement the confidentiality agreement entered
into between Anglo American Services
(UK) Limited and Sirius Minerals Plc
dated 8 January 2020
Convertible Bonds together, the Sirius 2023 Bonds and
the Sirius 2027 Bonds
Convertible Bondholders holders of the Convertible Bonds from
time to time
Co-operation Agreement the co-operation agreement dated 20
January 2020 between Anglo American,
Bidco and Sirius relating to, among
other things, the implementation of
the Acquisition, as described in paragraph
14 of this announcement
Court the High Court of Justice in England
and Wales
Court Meeting the meeting of Sirius Shareholders
to be convened pursuant to an order
of the Court under the Companies Act
for the purpose of considering and,
if thought fit, approving the Scheme
(with or without amendment), including
any adjournment thereof, notice of
which is to be contained in the Scheme
Document
Court Order the order of the Court sanctioning
the Scheme
Court Sanction Hearing the hearing of the Court to sanction
the Scheme under section 899 of the
Companies Act and, if such hearing
is adjourned, reference to commencement
of any such hearing shall mean the
commencement of the final adjournment
thereof
CREST the system for the paperless settlement
of trades in securities and the holding
of uncertificated securities operated
by Euroclear
Daily Official List the Daily Official List published
by the London Stock Exchange
Dealing Disclosure has the same meaning as in Rule 8
of the Takeover Code
Deposit Agreement the deposit agreement governing the
Sirius ADRs dated 17 November 2014
between: (i) Sirius; (ii) the Sirius
Depositary; and (iii) all holders
and beneficial owners of American
depositary shares as evidenced by
ADRs
Disclosed the information disclosed by, or on
behalf of Sirius, (i) in the annual
report and accounts of the Sirius
Group for the financial year ended
31 December 2018; (ii) the interim
results of the Sirius Group for the
six month period ending on 30 June
2019; (iii) in the annual report and
financial statements of York Potash
Ltd for the financial year ended 31
December 2018; (iv) in the annual
report and financial statements of
York Potash Processing & Ports Limited
for the financial year ended 31 December
2018; (v) in this announcement; (vi)
in any other announcement to a Regulatory
Information Service by, or on behalf
of Sirius prior to the publication
of this announcement; or (vii) as
otherwise fairly disclosed to Anglo
American (or its respective officers,
employees, agents or advisers) prior
to the date of this announcement,
including in the 'Sirius Minerals'
virtual data room hosted by Ansarada
Effective in the context of the Acquisition:
(i) if the Acquisition is implemented
by way of the Scheme, the Scheme having
become effective in accordance with
its terms; or
(ii) if the Acquisition is implemented
by way of a Takeover Offer, such Takeover
Offer having been declared and become
unconditional in all respects in accordance
with the Takeover Code
Effective Date the date on which either: (i) the
Scheme becomes effective in accordance
with its terms; or (ii) if Anglo American
and Bidco elect, and the Panel consents,
to implement the Acquisition by way
of a takeover offer (as defined in
Chapter 3 of Part 28 of the Companies
Act), the date on which such takeover
offer becomes or is declared unconditional
in all respects
Enlarged Group the combined Sirius Group and Anglo
American Group following completion
of the Acquisition
Euroclear Euroclear UK and Ireland Limited
FCA or Financial Conduct the Financial Conduct Authority acting
Authority in its capacity as the competent authority
for the purposes of Part VI of the
UK Financial Services and Markets
Act 2000
Forms of Proxy the forms of proxy in connection with
each of the Court Meeting and the
General Meeting, which shall accompany
the Scheme Document
General Meeting the general meeting of Sirius Shareholders
(including any adjournment thereof)
to be convened in connection with
the Scheme
Hancock Hancock British Holdings Limited
IFRS International Financial Reporting
Standards
J.P. Morgan Cazenove J.P. Morgan Securities plc
Lazard Lazard & Co., Limited
Listing Rules the rules and regulations made by
the Financial Conduct Authority under
the Financial Services and Markets
Act 2000 (as amended), and contained
in the publication of the same name,
as amended from time to time
London Stock Exchange London Stock Exchange plc
Long Stop Date 30 April 2020 or, if CADE do not consider
that the application form is eligible
for the fast-track review procedure,
18 June 2020 or such later date as
may be agreed in writing by Anglo
American and Sirius (with the Panel's
consent and as the Court may approve
(if such approval(s) are required))
MHF material handling facility
MTS mineral transport system
Offer Period the offer period (as defined by the
Takeover Code) relating to Sirius,
which commenced on 8 January 2020
Offer Price 5.50 pence per Sirius Share
Official List the Official List of the London Stock
Exchange
Opening Position Disclosure has the same meaning as in Rule 8
of the Takeover Code
Operating Model the model used by Anglo American to
enable it to apply a manufacturing
approach to its mining and production
processing to organise and efficiently
plan, schedule and resource the work
to be executed, in order to deliver
safer, more consistent and lower cost
production with increased predictability
and process stability
Overseas Shareholders Sirius Shareholders (or nominees of,
or custodians or trustees for Sirius
Shareholders) not resident in, or
nationals or citizens of the United
Kingdom
Panel the Panel on Takeovers and Mergers
Project Sirius' North Yorkshire polyhalite
project
Registrar of Companies the Registrar of Companies in England
and Wales
Regulation the Council Regulation (EC) 139/2004
Regulatory Conditions the Conditions set out in paragraphs
3(a) to 3(c) (inclusive) of Part A
of Appendix I to this announcement
Regulatory Information any of the services set out in Appendix
Service I to the Listing Rules
Relevant Authority any central bank, ministry, governmental,
quasi-governmental, supranational,
statutory, regulatory or investigative
body, authority or authority (including
any national or supranational anti-trust
or merger control authority, any sectoral
ministry or regulator and any foreign
investment review body), national,
state, municipal or local government
(including any subdivision, court,
administrative agency or commission
or other authority thereof), any entity
owned or controlled by them, any private
body exercising any regulatory, taxing,
importing or other authority, trade
agency, association, institution or
professional or environmental body
in any jurisdiction, including, for
the avoidance of doubt, the Panel
Restricted Jurisdiction any jurisdiction where local laws
or regulations may result in a significant
risk of civil, regulatory or criminal
exposure if information concerning
the Acquisition is sent or made available
to Sirius Shareholders
Royalty Deed the royalty financing agreement dated
25 October 2016 between Sirius, York
Potash Limited, York Potash Processing
& Ports Limited and Hancock (as amended
by a side letter on 13 September 2018)
Scheme the proposed scheme of arrangement
under Part 26 of the Companies Act
between Sirius and the Sirius Shareholders
in connection with the Acquisition,
with or subject to any modification,
addition or condition approved or
imposed by the Court and agreed by
Sirius, Anglo American and Bidco
Scheme Document the document to be sent to Sirius
Shareholders containing, amongst other
things, the Scheme and the notices
convening the Court Meeting and the
General Meeting
Scheme Record Time the time and date specified as such
in the Scheme Document
Scheme Voting Record Time the date and time specified in the
Scheme Document by reference to which
entitlement to vote at the Court Meeting
shall be determined, expected to be
6:30 p.m. on the day which is two
Business Days before the Court Meeting
or, if the Court Meeting is adjourned,
6:30 p.m. on the day which is two
Business Days before the date of such
adjourned Court Meeting
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
Sirius Sirius Minerals Plc
Sirius 2023 Bonds the US$400,000,000 8.5 per cent. guaranteed
convertible bonds due 2023 issued
by Sirius Minerals Finance Limited,
which are guaranteed by Sirius and
convertible into Sirius Shares (of
which there are US$137,600,000 outstanding
as at 16 January 2020, being the last
practicable date before the date of
this announcement)
Sirius 2027 Bonds the US$106,600,000 5.0 per cent. guaranteed
convertible bonds due 2027 issued
by Sirius Minerals Finance No.2 Limited,
which are guaranteed by Sirius and
convertible into Sirius Shares (of
which there are US$99,000,000 outstanding
as at 16 January 2020, being the last
practicable date before the date of
this announcement)
Sirius ADRs Sirius' sponsored level 1 American
Depositary Receipts for which Deutsche
Bank Trust Company Americas acts as
Sirius Depositary
Sirius Board the board of directors of Sirius at
the time of this announcement or,
where the context so requires, the
board of directors of Sirius from
time to time
Sirius Depositary Deutsche Bank Trust Company Americas,
as depositary for the Sirius ADRs
program
Sirius Directors the directors of Sirius at the time
of this announcement or, where the
context so requires, the directors
of Sirius from time to time
Sirius Group Sirius and its subsidiary undertakings
and, where the context permits, each
of them
Sirius Share Plans the Sirius Share Based Incentive Plan,
the Sirius Company Share Option Plan,
the Sirius Unapproved Share Option
Plan and the Sirius Incentive Option
Scheme, and the terms governing the
"milestone awards" held by the Sirius
Chief Financial Officer, General Counsel
and Company Secretary and Chief Development
Officer
Sirius Shareholders or the holders of Sirius Shares
Shareholders
Sirius Shares the existing unconditionally allotted
or issued and fully paid ordinary
shares of 0.25 pence each in the capital
of Sirius and any further such ordinary
shares which are unconditionally allotted
or issued before the Effective Date
Takeover Code the City Code on Takeovers and Mergers
Takeover Offer 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 Anglo American to acquire
the entire issued and to be issued
share capital of Sirius not already
directly or indirectly held by the
Anglo American Parties and, where
the context admits, any subsequent
revision, variation, extension or
renewal of such takeover offer
Third Party each of a central bank, government
or governmental, quasi-governmental,
supranational, statutory, regulatory,
environmental, administrative, fiscal
or investigative body, court, trade
agency, association, institution,
environmental body, employee representative
body or any other body or person whatsoever
in any jurisdiction
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
US Exchange Act the United States Securities Exchange
Act 1934, as amended
Wider Anglo American Group Anglo American and associated undertakings
and any other body corporate, partnership,
joint venture or person in which Anglo
American and all such undertakings
(aggregating their interests) have
a Significant Interest
Wider Sirius Group Sirius and associated undertakings
and any other body corporate, partnership,
joint venture or person in which Sirius
and 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 "Sterling", "GBP", "pence" and "p" are to the
lawful currency of the United Kingdom.
All references to "US$", "$" and "US Dollars" are to the lawful
currency of the United States.
All the times referred to in this announcement are London times
unless otherwise stated.
References to the singular include the plural and vice
versa.
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
OFFDBGDBIUBDGGC
(END) Dow Jones Newswires
January 20, 2020 02:15 ET (07:15 GMT)
Copyright (c) 2020 Dow Jones & Company, Inc.
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