Keybridge Capital Limited (ASX:KBC) made an offer to acquire remaining 93.9% stake in Yowie Group Limited (ASX:YOW) from HHY Fund (ASX:HHY) managed by Aurora Funds Management Limited, Louis Carroll, Mark Schuessler, Glen Watts, Wilson Asset Management (International) Pty Limited and others for AUD 18.8 million on March 13, 2019. The consideration will be paid in either cash or a combination of cash and Keybridge Capital Limited's listed convertible redeemable promissory notes. If Keybridge Capital Limited receives acceptances under the bid up to a cost of AUD 9 million, all shareholders of Yowie Group Limited who have accepted will receive 100% cash consideration – this equates to acceptances totaling 97.8 million Yowie Group Limited's shares or 44.9% of all Yowie Group Limited's shares and means that no notes will be used as bid consideration until Keybridge Capital Limited reaches a relevant interest of 51% of Yowie Group Limited's current issued capital and If Keybridge Capital Limited receives acceptances under the bid in excess of a cost of AUD 9 million, the excess bid consideration will be satisfied by the issue of new notes, under this scenario, shareholders of Yowie Group Limited will receive cash and notes on a proportionate basis based on their Yowie Group Limited's shareholdings. The consideration will be paid by the earlier of one month after the acceptance of the offer or if the offer is still subject to a condition within one month after the offer becomes unconditional or 21 days after the end of the offer period. Prior to the transaction, Keybridge Capital Limited holds 13.2 million shares amounting to 6.1% stake in Yowie Group Limited. Keybridge intends to fund the cash component of the consideration through its existing cash reserves and to the extent necessary through the realization of its liquid assets. Keybridge Capital Limited has AUD 20.8 million liquid assets to fund the transaction. After the transaction, Yowie Group Limited will become a wholly owned subsidiary of Keybridge Capital Limited.

The transaction will be subject to certain conditions including minimum cash balance, maximum liabilities requirements, in the event Keybridge issues Keybridge notes as part of the consideration, ASX granting permission for quotation of the Keybridge notes no later than 7 days after the end of the offer period and in the event Keybridge issues Keybridge notes as part of the consideration, Keybridge shareholders approving the issue of the Keybridge notes if required pursuant to the listing rules. If any condition is not satisfied and Keybridge does not free the offer from that condition by the end of the offer period, the offer will lapse. The transaction has been unanimously approved by the Board of Keybridge Capital Limited.

If Keybridge Capital Limited holds a relevant interest in less than 50% of Yowie Group Limited's shares, Keybridge will seek the appointment of two qualified and experienced Directors to the Board of Yowie to replace Louis Carroll and Glen Watts. The replacement Directors may include one or more of Keybridge Officers. Keybridge intends that Mark Schuessler continue in his role as the Managing Director of Yowie. If at the end of the offer, Yowie Group Limited is a controlled entity of Keybridge where Keybridge has a relevant interest in more than 50% of Yowie Shares but not a wholly owned subsidiary of Keybridge which will only occur where Keybridge has acquired a relevant interest in more than 90% of Yowie's shares and has completed the compulsory acquisition process to gain an interest in 100% of Yowie shares, Keybridge intends to seek to re-constitute the Board of Directors of Yowie to reflect Keybridge's majority ownership of Yowie by seeking the appointment of a majority of Keybridge nominees to the Yowie Board. Keybridge will seek the appointment of a minimum of three qualified and experienced Directors to the Board of Yowie to replace Louis Carroll (currently Non-Executive Chairman), Glen Watts (currently a Non-Executive Director) and Mark Schuessler (currently Managing Director). Keybridge intends that Mark Schuessler continue in his role as Global Chief Executive Officer as an employee of Yowie. Keybridge intends that Yowie remain on the official list of ASX. If at the end of the offer, Keybridge has a relevant interest in more than 90% of Yowie's shares and is entitled to proceed to compulsory acquisition of the outstanding Yowie Shares, Keybridge intends to exercise its rights to proceed to compulsory acquisition of Yowie Shares. At the conclusion of the compulsory acquisition process, Keybridge intends to arrange for Yowie to be removed from the official list of ASX. Keybridge intends to replace all members of the Board of Yowie with its own nominees. Keybridge intends that Mark Schuessler continue in his role as Global Chief Executive Officer as an employee of Yowie. It is expected that the replacement directors may include one or more of Keybridge Officers. If after the completion of the offers, Keybridge has a relevant interest in less than 90% of Yowie's Shares, Keybridge may acquire additional Yowie shares under the “creep” provisions of the corporations act or as otherwise permitted by the corporations act. The shareholders of Yowie Group Limited are advised to take no action in respect of the offer until the Board makes a formal recommendation.

Deloitte Touche Tohmatsu Australia acted as the auditor to Keybridge Capital Limited. Bennett + Co acted as the legal advisor to Keybridge Capital Limited and will receive legal fees of approximately AUD 0.03 million and Security Transfer Australia Pty Ltd acted as the share registrar to Keybridge Capital Limited and will receive registry fees of approximately AUD 0.01 million. Advanced Share Registry Limited (ASX:ASW) acted as the registrar to Keybridge Capital Limited. Kardos Scanlan acted as legal advisor to Wilson Asset Management (International) Pty Limited. Jeremy Kriewaldt Lawyers acted as legal advisor to Keybridge Capital Limited. PricewaterhouseCoopers Australia acted as accountant to Yowie Group Limited.

Keybridge Capital Limited (ASX:KBC) cancelled the acquisition of the remaining 93.9% stake in Yowie Group Limited (ASX:YOW) from HHY Fund (ASX:HHY) managed by Aurora Funds Management Limited, Louis Carroll, Mark Schuessler, Glen Watts, Wilson Asset Management (International) Pty Limited and others on May 2, 2019. Keybridge determined that defeating conditions have been breached and will not be fulfilled, it does not waive the triggered defeating conditions and any acceptance of offers received will not constitute a binding contract with Keybridge.