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INTERNATIONAL HOTEL PROPERTIES LIMITED - Disclosure of inside information in terms of Article 17 of EU MAR - proposed scheme of arrangement and delisting

Release Date: 19/07/2017 08:30
Code(s): IHL     PDF:  
 
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Disclosure of inside information in terms of Article 17 of EU MAR - proposed scheme of arrangement and delisting

International Hotel Properties Limited
(previously International Hotel Group Limited)
(Incorporated in the British Virgin Islands)
(Company number 1862176)
JSE share code: IHL
ISIN: VGG487261064
LEI Code: 213800VGTQA4SMCAWP71
(“IHL” or the “Company”)


DISCLOSURE OF INSIDE INFORMATION IN TERMS OF ARTICLE 17 OF THE EU MARKET ABUSE REGULATIONS - PROPOSED 
SCHEME OF ARRANGEMENT AND DELISTING


1. Rationale for and proposed terms of the proposed transaction

   Following an assessment undertaken by the board of directors of IHL (the “Board”), the Board has
   concluded that the listing of the Company’s shares on the Johannesburg Stock Exchange (“JSE”) and
   Euro MTF market of the Luxembourg Stock Exchange (“LuxSE”) has not provided and is not
   anticipated in the medium term to provide the liquidity or access to equity capital markets required to
   facilitate the growth of the Company and that the costs and administrative burden of maintaining the
   listings are no longer justified.

   It is proposed that the delisting be effected by way of a scheme of arrangement to be proposed by
   Redefine International P.L.C. (“Redefine International”) in terms of the BVI Business Companies Act,
   2004 between IHL and its shareholders other than (i) Redefine Share Investments Limited (a subsidiary
   of Redefine International), (ii) Redefine Properties Limited and (iii) Southern Sun Africa Limited (the
   “scheme members”), pursuant to which Redefine International will acquire all IHL shares held by
   scheme members in consideration for 2.5 Redefine International shares for every 1 IHL share held (the
   “scheme consideration”) and on implementation of the scheme the listing of the Company’s shares on
   both the JSE and LuxSE will be terminated (the “proposed transaction”).

   The Board is of the opinion that the proposed transaction is beneficial and fair to the scheme members
   noting that the scheme consideration will be accretive from both an earnings and net asset value
   perspective and that, on a relative basis, Redefine International shares are more liquid and are traded
   on both the London Stock Exchange and the JSE. In addition, scheme members will benefit through
   exposure to a significantly larger and more diversified portfolio, which is focused on Europe’s two
   strongest economies, being the United Kingdom and the Federal Republic of Germany.

   Engagements with Redefine International and other shareholders are continuing and the Board will only
   proceed with the proposed transaction if it is satisfied that the proposed transaction will be supported by
   an overwhelming majority of shareholders.

2. Illustrative financial effects pertaining to the proposed transaction

   The table below sets out the illustrative financial effects of the proposed transaction on a scheme
   member, assuming (i) a swap ratio of 2.5 Redefine International shares for every 1 IHL share and (ii)
   that the proposed transaction had been implemented on 1 March 2016 for the purposes of the
   statement of comprehensive income and on 28 February 2017 for purposes of the statement of financial
   position.

   The illustrative financial effects are not pro forma effects and are provided for illustrative purposes only.
   The illustrative financial effects are the responsibility of the directors of IHL, and have not been
   reviewed or reported on.

   Illustrative financial effects of the proposed transaction              Before(1)      After(2)   % change
   (pence)
   NAV per share                                                             94.6          99.5          5.1%
   Dividend per share                                                         5.2           7.2         38.2%

   Notes and assumptions:

       1.      The “Before” NAV per share has been derived from IHL’s half year report and financial
               statements for the six months ended 28 February 2017.

               The “Before” dividend per share is the total IHL dividend per share for the twelve months
               ending 28 February 2017.

       2.      The “After” column illustrates the implied NAV and dividend per share an IHL shareholder
               would have received based on the scheme consideration.

               The “After” NAV per share is calculated as the basic NAV per share of 39.8 pence, extracted
               from Redefine International’s interim results for the six months ended 28 February 2017,
               multiplied by 2.5 times.

               The “After” dividend per share is calculated as the total Redefine International dividend per
               share for the 12 months ended 28 February 2017 of 2.88 pence, multiplied by 2.5 times.
               Please note that as previously communicated by Redefine International, the medium-term
               guidance as to the dividend pay-out ratio is 90 – 95 per cent of underlying earnings, for
               which only the portion of the dividend relating to the 6 month period ended 28 February 2017
               is based upon.

3. Cautionary announcement

   Shareholders are advised to exercise caution when dealing in the Company’s shares until a further
   announcement in relation to the proposed transaction is made.

The person responsible for making this notification on behalf of the Company is Helder Pereira, Chairman
of the Company.


For further information, please contact:

M Partners
Luxembourg listing agent                            +352 263 868 602

Java Capital
JSE sponsor                                         +27 (0) 11 722 3050

FTI Consulting
South African Public Relations Advisor
Sherryn Schooling                                   +27 (0) 21 487 9027

Company Secretary
Osiris Secretarial Services Ltd                     +1 (284) 494 9820

Notes to editors:

IHL is a hotel and leisure focused property investment company which owns nine hotels in the UK. The
Company’s shares are currently listed on the official list and admitted to trading on the Euro MTF market of
the Luxembourg Stock Exchange, which constitutes its primary listing, and on the AltX of the JSE which
constitutes its secondary listing.

19 July 2017, 8.30 CEST / SAST

Date: 19/07/2017 08:30:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE'). 
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