15 September 2016
Proposed Resolution to Purchase Own Shares and Rule 9 Waiver
In accordance with Listing Rule 12.4.4, Redrow plc (the "Company") announces that the Board has decided to propose a resolution seeking general authorisation to make market purchases of up to 36,979,993 ordinary shares of the Company (representing 10 per cent. of the Company's issued share capital) subject to the requirements of the Listing Rules of the UK Listing Authority (the "Buy Back Resolution") at the Company's forthcoming annual general meeting (the "2016 AGM").
As a result of recent fluctuations in the Company's share price, the Board considers that it is appropriate for the Company to be in a position to buy back shares in the coming year if it would be in the best economic interests of the Company to do so. Accordingly, the Directors intend to propose the Buy Back Resolution at the 2016 AGM. It is the Directors' current intention to request authorisation annually going forward.
Since Steve Morgan has an interest in approximately 40.40 per cent. of the Company's issued share capital, any purchase of ordinary shares of the Company pursuant to the authority granted by the Buy Back Resolution would result in an obligation for Mr Morgan to make a general offer in accordance with Rule 9 of the City Code on Takeovers and Mergers (the "Code"). Therefore, the Board has also decided to ask independent shareholders to approve at the 2016 AGM a waiver by the Panel on Takeovers and Mergers (the "Waiver") of any such obligation following any increase in the shareholding of Mr Morgan or any person with whom Mr Morgan is acting in concert (as defined in the Code) up to a maximum of approximately 44.88 per cent. of the Company's share capital as a result of any exercise of the authority granted under the Buy Back Resolution (the "Waiver Resolution").
Passing the Waiver Resolution will give the Company the flexibility to buy back its shares without triggering an obligation for Mr Morgan to make a mandatory offer for the Company. Although the Board has no current intention to repurchase shares, it believes that giving the Company authority to do so is in the best interests of the Company and its shareholders as a whole and the independent Directors (being the Directors other than Steve Morgan) consider that the Waiver is a prudent measure to facilitate this.
The Directors would exercise the authority granted under the Buy Back Resolution only if they felt it would be in the best economic interests of the Company to do so. Other investment opportunities, appropriate gearing levels and the overall financial position of the Company will be taken into account before deciding upon the course of action. The Company's current intention is to cancel any repurchased shares but retains the flexibility to hold any repurchased shares as treasury shares if it considers this to be in the best interests of the Company.
Full details of the Buy Back Resolution and the Waiver Resolution will be set out in the Company's Notice of the 2016 AGM, which will be sent to shareholders and made available on the Company's website (www.redrowplc.co.uk) in due course.
This information is provided by RNS