THE RENEWABLES INFRASTRUCTURE GROUP LIMITED THIS ANNOUNCEMENT AND THE INFORMATION CONTAINED HEREIN ARE NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, DIRECTLY OR INDIRECTLY, IN OR INTO, THE UNITED STATES, AUSTRALIA, CANADA, JAPAN OR THE REPUBLIC OF SOUTH AFRICA OR IN ANY OTHER JURISDICTION IN WHICH THE SAME WOULD BE UNLAWFUL.
This announcement is an advertisement and not a prospectus. Investors should not purchase or subscribe for any transferable securities referred to in this announcement except on the basis of information contained in the Prospectus (as defined herein). This announcement is not an offer to sell, or a solicitation of an offer to acquire, securities in the United States or in any other jurisdiction in which the same would be unlawful. Neither this announcement nor any part of it shall form the basis of or be relied on in connection with or act as an inducement to enter into any contract or commitment whatsoever.
Canaccord Genuity Limited and Liberum Capital Limited (together the 'Joint Bookrunners'), are each authorised and regulated by the Financial Conduct Authority, are each acting only for the Company in connection with the matters described in this announcement and are not acting for or advising any other person, or treating any other person as their respective client, in relation thereto and will not be responsible for providing the regulatory protection afforded to their respective clients or advice to any other person in relation to the matters contained herein.
The contents of this announcement, which has been prepared by and is the sole responsibility of the Company, have been approved by InfraRed solely for the purposes of section 21(2)(b) of the Financial Services and Markets Act 2000.
This announcement has been determined to contain inside information for the purposes of the market abuse regulation (EU) No.596/2014.
7 March 2019
The Renewables Infrastructure Group Limited ('TRIG' or the 'Company')
Publication of a Prospectus and Circular
and
Proposed Initial Placing, Open Offer, Offer for Subscription and Intermediaries Offer
The board of directors (the 'Board') of the Companyis pleased to announce the publication of a prospectus (the 'Prospectus') and a circular to shareholders (the 'Circular') in relation to a share issuance programme of up to 450 million new Ordinary Shares and/or C Shares (the 'Share Issuance Programme'), including an Initial Placing, Initial Open Offer, Initial Offer for Subscription and Intermediaries Offer to raise gross proceeds of up to £171 million (the 'Initial Issue').
As set out in the Circular, the Share Issuance Programme, including the Initial Issue, is conditional on the approval of Shareholders at an Extraordinary General Meeting, which has been convened for 10.00 a.m. on 27 March 2019.
The Prospectus will shortly be made available on the Company's website (www.trig-ltd.com) and on the National Storage Mechanism at www.morningstar.co.uk/uk/NSM. Unless otherwise defined, capitalised words and phrases in this announcement shall have the meaning given to them in the Prospectus.
Key Highlights
· Under the Initial Issue, TRIG is proposing to issue up to 150 million new Ordinary Shares at an issue price of 114 pence per Ordinary Share (the 'Initial Issue Price') to raise gross proceeds of up to £171 million.
· The Initial Issue Price represents a 4.0 per cent. discount to the middle market closing price of 118.8 pence as at close of business on 6 March 2019, and a 2.2 per cent. premium to the Company's NAV per Ordinary Share of 111.6 pence as at 28 February 2019.
· The proceeds from the Initial Issue will principally be used to repay the amounts drawn under the Company's Revolving Acquisition Facility and to help to meet its outstanding investment commitments which the Company expects to make (further details of which are set out below).
· Under the Initial Open Offer, up to 130,930,306 new Ordinary Shares will be made available to Qualifying Shareholders pro rata to their holdings of Ordinary Shares on the basis of 1 New Ordinary Share for every 9 Ordinary Shares held as at close of business on 5 March 2019. The balance of New Ordinary Shares to be made available under the Initial Issue, together with any New Ordinary Shares not taken up pursuant to the Initial Open Offer, will be made available under the Excess Application Facility, the Initial Placing and, the Initial Offer for Subscription and/or the Intermediaries Offer.
· The New Ordinary Shares issued pursuant to the Initial Issue will rank for the quarterly interim dividend of 1.66 pence which is expected to be declared in May 2019 and paid in June 2019 with respect to the three months ended 31 March 2019.
· The Board have reserved the right, in consultation with the Joint Bookrunners and the Investment Manager, to increase the size of the Initial Issue in the event that overall demand for the New Ordinary Shares exceeds the target size provided that the maximum amount raised under the Initial Issue will not exceed the Outstanding Commitments and the amount drawn under the Revolving Acquisition Facility as at the Initial Closing Date.
The Initial Issue is being conducted in accordance with the terms and conditions as set out in the Prospectus.
Helen Mahy CBE, Chairman of TRIG, said:
'TRIG has performed strongly since its IPO, delivering attractive returns to investors and seeing ongoing diversified growth. This performance is testament to the expertise of our managers and the Board is confident of TRIG's ability to continue to capitalise on new business opportunities whilst contributing to a lower carbon future.'
Richard Crawford, Director - Infrastructure at InfraRed Capital Partners, Investment Manager to TRIG, said:
'2018 was another good year for TRIG and we made significant commitments to further grow and diversify our portfolio. Following the positive equity issuances in 2018 and given our strong pipeline of acquisitions, we are pleased to announce a further share issue in line with our strategy. We have strong relationships which help us to be selective in our approach when evaluating new investments. The issue will allow TRIG to take advantage of new opportunities and deliver further value for our shareholders.'
Background to and rationale for the Initial Issue and the Share Issuance Programme
During 2018, investment commitments were made to acquire a 75 per cent. equity interest in the Erstrask Wind Farm in Sweden (171.8MW, net share) which is currently under construction for aggregate consideration (payable only on completion of construction milestones) of £171.6 million (assuming a euro/sterling exchange rate of 1.1124 as at 31 December 2018) and to the build out of the Solwaybank wind farm, a 30MW construction project in Scotland, for £33 million.
Since 1 January 2019, the Company has invested £44.6 million (€52.0 million) to part fund the acquisition of the Erstrask Wind Farm and, as announced on 28 February 2019, has contracted to acquire its second Swedish asset, the Jädraås wind farm, an operating wind farm with generating capacity of 212.9 MW, for €206.6 million (£177.2 million, assuming a euro/sterling exchange rate of 1.1660 as at 28 February 2019), the acquisition of which is expected to complete prior to Initial Admission (the 'Jädraås Wind Farm'). This will result in outstanding commitments, as at the latest practicable date prior to this announcement (the 'Latest Practicable Date'), of £158.4 million in respect of the Erstrask and Solwaybank wind farms (of which £24.6 million is expected to be paid in the remainder of 2019, £117.7 million in the first quarter of 2020 and £16.1 million thereafter) plus the purchase price for the Jädraås Wind Farm (together the 'Outstanding Commitments').
Portfolio acquisitions have typically been funded from the Company's revolving acquisition facility with Royal Bank of Scotland International, National Australia Bank and ING Bank which has been repaid from the proceeds of subsequent equity issuances at a premium to the prevailing NAV. The Revolving Acquisition Facility was renewed in December 2018, its duration extended until December 2021 and the committed facility size increased from £240 million to £340 million. This enables the Company to access more short-term capital to execute on its active pipeline which includes some potential larger acquisitions, reflecting the increased scale of many new renewables' projects, which would then typically be followed by the issue of fresh equity to repay the drawings.
As at the Latest Practicable Date, the Revolving Acquisition Facility was £44.6 million (€52.0 million) drawn. On completion of the acquisition of the Jädraås Wind Farm(anticipatedprior to Initial Admission) this will increase to approximately £221.8 million(€258.6 million).As noted above, the Company also has other Outstanding Commitments of which, as at the Latest Practicable Date,£142.3millionis expected to become due during the next 12 months in respect of the Erstrask and Solwaybank wind farms. The proceeds from the Initial Issue, together with the expected proceeds of the refinancing of a portfolio of onshore wind farms, will principally be used to repay the amount drawn under the Revolving Acquisition Facility and to finance the Outstanding Commitments. The Company expects the proceeds from this refinancing to be approximately £60 million. In addition, the Company has an active pipeline comprising several investment opportunities, including some at an advanced stage of negotiation for investments in wind farms located within France and the UK.
The issue of 71,867,849 Ordinary Shares on 19 November 2018 exhausted the Company's tap authorities taken at the 2018 AGM and the extraordinary general meeting of the Company held on 9 November 2018.
After due consideration of the Company's strategy and in light of the imminent completion of the acquisition of the Jädraås Wind Farm, the other Outstanding Commitments and the Company's pipeline, the Board has concluded that it is now appropriate to put in place a new share issuance programme under which it will be able to issue New Shares in a series of subsequent placings following the Initial Issue. The Company stands to benefit from the flexibility to issue capital quickly and efficiently under the Share Issuance Programme and, in the Investment Manager's opinion, the Share Issuance Programme will be particularly helpful in strengthening the Company's competitive position, as to flexibility and timing, when the Company seeks to buy larger scale single assets or portfolios that become available in the market from time to time.
The Share Issuance Programme
The Company intends to issue up to 450 million New Shares under the Share Issuance Programme pursuant to one or more Tranches (including the Initial Issue). Subject to the Share Issuance Programme becoming unconditional upon the passing of the SIP Disapplication Resolution at the Extraordinary General Meeting, New Shares will be available for issue under the Share Issuance Programme from 7 March 2019 until 6 March 2020 (or any earlier date on which all the New Shares the subject of the Share Issuance Programme are issued). Each Tranche under the Share Issuance Programme will comprise a placing and may, at the sole discretion of the Board, in consultation with the Joint Bookrunners, comprise an open offer and/or offer for subscription component.
All New Ordinary Shares issued pursuant to the Share Issuance Programme on a non-pre-emptive basis will be issued at a premium to the Net Asset Value per Ordinary Share sufficient to at least cover the costs and expenses of the relevant Tranche.
Initial Issue
Under the Initial Placing, the Initial Open Offer, the Initial Offer for Subscription and the Intermediaries Offer, the Company is seeking to raise approximately £171 million (before expenses) through the issue of up to 150 million New Ordinary Shares in aggregate at an issue price of 114 pence per New Ordinary Share.
The Board have reserved the right, in consultation with the Joint Bookrunners and the Investment Manager, to increase the size of the Initial Issue in the event that overall demand for the New Ordinary Shares exceeds the target size provided that the maximum amount raised under the Initial Issue will not exceed the Outstanding Commitments and the amount drawn under the Revolving Acquisition Facility as at the Initial Closing Date.
Under the Initial Open Offer, 130,930,306 New Ordinary Shares will be made available to Qualifying Shareholders at the Initial Issue Price pro rata to their holdings of Existing Ordinary Shares, on the terms and subject to the conditions of the Initial Open Offer, on the basis of:
1 New Ordinary Share for every 9 Existing Ordinary Shares held at the Record Date (being the close of business on 5 March 2019)
The balance of the New Ordinary Shares to be made available under the Initial Issue, together with any New Ordinary Shares not taken up pursuant to the Initial Open Offer, will be made available under the Excess Application Facility, the Initial Placing, the Initial Offer for Subscription and/or the Intermediaries Offer.
Subject to availability, Qualifying Shareholders who take up all of their Open Offer Entitlements may also apply under the Excess Application Facility for additional New Ordinary Shares in excess of their Open Offer Entitlement. The Excess Application Facility will comprise such number of New Ordinary Shares, if any, which in their absolute discretion (in consultation with the Joint Bookrunners, the Investment Manager and the Operations Manager) the Board determine to make available under the Excess Application Facility, which may include any New Ordinary Shares which are not taken up by Qualifying Shareholders pursuant to their Open Offer Entitlements, fractional entitlements under the Initial Open Offer which have been aggregated and any New Ordinary Shares which would otherwise have been available under the Initial Placing, Initial Offer for Subscription or the Intermediaries Offer but which the Board determine to allocate to the Excess Application Facility (including any additional New Ordinary Shares which may be made available under the Initial Issue if the Board exercise their discretion to increase the size of the Initial Issue). No assurance can be given that any New Ordinary Shares will be allocated to, and made available under, the Excess Application Facility.
The Initial Issue Price of 114 pence per New Ordinary Share compares to the closing mid-market price of an Ordinary Share of 118.8 pence as at 6 March 2019 (being the latest practicable date prior to the publication of the Prospectus) and the latest NAV per Ordinary Share (unaudited) as at 28 February 2019 of 111.6 pence (ex the dividend declared on 14 February 2019 in respect of the three month period to 31 December 2018, payable on 29 March 2019) (113.2 pence cum-dividend).
The Initial Issue, which is not underwritten, is conditional upon, inter alia, Initial Admission occurring on or before 1 April 2019 (or such later date, not being later than 30 April 2019, as the Company and the Joint Bookrunners may agree). If this, or any of the other conditions to which the Initial Issue is subject is not met, the Initial Issue will not proceed and an announcement to that effect will be made via a Regulatory Information Service.
Extraordinary General Meeting
The Company is today posting to shareholders a circular to convene an Extraordinary General Meeting in order to seek shareholder approval in connection with the Share Issuance Programme and Initial Issue. The Extraordinary General Meeting will be held at 10.00 a.m. on 27 March 2019 at East Wing, Trafalgar Court, Les Banques, St Peter Port, Guernsey GY1 3PP. Forms of Proxy in respect of the Extraordinary General Meeting should be returned by no later than 10.00 a.m. on 25 March 2019.
Application for Admission
Application will be made to the Financial Conduct Authority for admission of the New Ordinary Shares to the premium segment of the Official List and to London Stock Exchange plc for admission to trading of the New Ordinary Shares on its main market for listed securities. It is expected that Initial Admission will become effective on or around 1 April 2019 and that dealings in the New Ordinary Shares on the London Stock Exchange's Main Market for listed securities will commence at that time.
The New Ordinary Shares will, when issued, rank pari passu with the existing Ordinary Shares.
Expected timetable
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LEI: 213800N06Q7Q7HMOMT20
Enquiries
InfraRed Capital Partners Limited+44 (0) 20 7484 1800
Richard Crawford
Phil George
Canaccord Genuity Limited+44 (0) 20 7523 8000
Robbie Robertson
Dominic Waters
Neil Brierley
Will Barnett
Gavin Tooke
Lucy Lewis
Andrew Zychowski
Denis Flanagan
Liberum Capital Limited +44 (0) 20 3100 2000
Andrew Davies
Jack Kershaw
Anastasia Mikhailova
Chris Clarke
Gillian Martin
Louis Davies
Tulchan Communications +44 (0) 20 7353 4200
Martin Pengelley
Important Information
The New Shares offered by this Securities Note have not been and will not be registered under the United States Securities Act of 1933, as amended (the 'U.S. Securities Act'), or with any securities regulatory authority of any state or other jurisdiction of the United States and may not be offered, sold, exercised, resold, transferred or delivered, directly or indirectly, in or into the United States or to or for the account or benefit of any U.S. Person (within the meaning of Regulation S under the U.S. Securities Act) except pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the U.S. Securities Act and in compliance with any applicable securities laws of any state or other jurisdiction in the United States. In addition, the Company has not been, and will not be, registered under the United States Investment Company Act of 1940, as amended, (the 'U.S. Investment Company Act'), nor will InfraRed be registered as an investment adviser under the United States Investment Advisers Act of 1940, as amended (the 'U.S. Investment Advisers Act'), and investors will not be entitled to the benefits of the U.S. Investment Company Act or the U.S. Investment Advisers Act.
This Announcement does not constitute an offer to sell or issue or a solicitation of an offer to buy or subscribe for New Shares in any jurisdiction including, without limitation, the United States, Australia, Canada, Japan or South Africa or any other jurisdiction in which such offer or solicitation is or may be unlawful (an 'Excluded Territory'). This Announcement and the information contained therein are not for publication or distribution, directly or indirectly, to persons in an Excluded Territory unless permitted pursuant to an exemption under the relevant local law or regulation in any such jurisdiction.
No application to market the New Shares has been made by the Company under the relevant private placement regimes in any member state of the EEA other than in the United Kingdom, the Republic of Ireland, Sweden and the Netherlands. No marketing of New Shares in any member state of the EEA other than the United Kingdom, the Republic of Ireland, Sweden and the Netherlands will be undertaken by the Company save to the extent that such marketing is permitted by the AIFM Directive as implemented in the Relevant Member State.
The distribution of this Announcement, and/or the issue of New Shares in certain jurisdictions may be restricted by law and/or regulation. No action has been taken by the Company, the Joint Bookrunners or any of their respective affiliates as defined in Rule 501(b) under the U.S. Securities Act (as applicable in the context used, Affiliates) that would permit an offer of the New Shares or possession or distribution of this Announcement or any other publicity material relating to the New Shares in any jurisdiction where action for that purpose is required (other than the United Kingdom, the Republic of Ireland, Sweden and the Netherlands). Persons receiving this Announcement are required to inform themselves about and to observe any such restrictions.
The Joint Bookrunners, each of which is authorised and regulated in the United Kingdom by the Financial Conduct Authority, are acting for the Company and for no one else in connection with the Share Issuance Programme (including the Initial Issue) and will not be responsible to anyone other than the Company for providing the protections afforded to clients of the Joint Bookrunners or for providing advice in relation to the Share Issuance Programme (including the Initial Issue), or any other matters referred to herein.
Information for Distributors
Solely for the purposes of the product governance requirements contained within: (a) EU Directive 2014/65/EU on markets in financial instruments, as amended ('MiFID II'); (b) Articles 9 and 10 of Commission Delegated Directive (EU) 2017/593 supplementing MiFID II; and (c) local implementing measures, in the UK being the FCA's Product Intervention and Governance Sourcebook (PROD) (together the 'MiFID II Product Governance Requirements'), and disclaiming all and any liability, whether arising in tort, contract or otherwise, which any ''manufacturer'' (for the purposes of the MiFID II Product Governance Requirements) may otherwise have with respect thereto, the New Shares have been subject to a product approval process, which has determined that such New Shares are: (i) compatible with an end target market of (a) retail investors who do not need a guaranteed income or capital protection, who (either alone or in conjunction with an appropriate financial or other adviser) are capable of evaluating the merits and risks of such an investment and who have sufficient resources to be able to bear any losses that may result therefrom and (b) investors who meet the criteria of professional clients and eligible counterparties each as defined in MiFID II; and (ii) eligible for distribution through all distribution channels as are permitted by MiFID II for each type of investor (the 'Target Market Assessment').Notwithstanding the Target Market Assessment, distributors should note that: the price of the New Shares may decline and investors could lose all or part of their investment; the New Shares offer no guaranteed income and no capital protection; and an investment in the New Shares is compatible only with investors who do not need a guaranteed income or capital protection, who (either alone or in conjunction with an appropriate financial or other adviser) are capable of evaluating the merits and risk of such an investment and who have sufficient resources to be able to bear any losses that may result therefrom. The Target Market Assessment is without prejudice to the requirements of any contractual, legal or regulatory selling restrictions in relation to the Share Issuance Programme (including the Initial Issue). Furthermore, it is noted that, notwithstanding the Target Market Assessment, the Joint Bookrunners will only contact prospective investors through the Initial Placing or any subsequent placing who meet the criteria of professional clients and eligible counterparties.
For the avoidance of doubt, the Target Market Assessment does not constitute: (a) an assessment of suitability or appropriateness for the purposes of MiFID II; or (b) a recommendation to any investor or group of investors to invest in, or purchase, or take any other action whatsoever with respect to the New Shares.
Each distributor (including the Intermediaries) is responsible for undertaking its own target market assessment in respect of the New Shares and determining appropriate distribution channels.
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The Renewables Infrastructure Group Ltd. published this content on 07 March 2019 and is solely responsible for the information contained herein. Distributed by Public, unedited and unaltered, on 07 March 2019 13:12:03 UTC
