Mitchells & Butlers announces open offer to raise up to £351 million

LONDON: Board of Mitchells & Butlers plc has announced an underwritten fully pre-emptive open offer to raise up to £351 million, a news release said.

Background to the Open Offer:

·    The Group’s liquidity position has deteriorated significantly as a result of the impact of the COVID-19 pandemic and the Open Offer is critical for the continued operation of the Group and its immediate financial stability

·    An Open Offer of up to £351 million provides the Company with the capital to reduce its unsecured debt and to support the Group’s secured debt financing through an injection of equity, allowing the Group to meet its fixed obligations

·    It will also enable the resumption of investment in the Group’s estate to maintain its competitive position, providing the financial stability and strength to emerge from the crisis, allowing previous momentum to be regained

·    On 14 February 2021, the Company reached agreement with its relationship banks for a new £150 million 3 year unsecured revolving credit facility (the “Refinancing”). The facility under the Refinancing is conditional on completion of the Open Offer

·    Additionally, on 14 February 2021 an agreement was reached on a number of amendments and waivers (the “2021 WBS Amendments and Waivers”) with Ambac Assurance UK Limited as controlling creditor and HSBC Trustee (C.I.) Limited as trustee and borrower security trustee in respect of certain potential breaches under its secured debt financing arising as a result of the ongoing impact of COVID and the measures taken to stem the spread of the virus. In the event that the Open Offer is not completed, such Amendments and Waivers may be withdrawn

·    Pursuant to the Open Offer, the Company is proposing to offer New Shares to all Qualifying Shareholders at a price of 210 pence per share on the basis of 7 New Shares for every 18 Existing Shares

·    As announced on 15 February 2021, Piedmont Inc., Elpida Group Limited and Smoothfield Holding Ltd. have been acquired by Odyzean Limited and as such are now wholly owned subsidiaries of Odyzean (collectively the “Odyzean Group”).  As a result, the Odyzean Group held approximately 55 per cent. of the Company’s issued share capital as at 19 February 2021

·    The Odyzean Group has entered into an irrevocable undertaking with the Company to take up its entitlements under the Open Offer and to subscribe for any additional shares that become available through, and are allocated to it under, the Excess Application Facility. The Open Offer is therefore fully underwritten

·    The Open Offer is conditional upon shareholder approval

Morgan Stanley & Co. International plc is acting as Financial Adviser, Global Co-ordinator, Joint Bookrunner, Corporate Broker and Sponsor, alongside N. M. Rothschild & Sons Limited as Financial Adviser to the Company. HSBC Bank plc and Banco Santander, S.A. are acting as Joint Bookrunners.

www.mbplc.com

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