Source - RNS
RNS Number : 5200J
HarbourVest Structured SolutionsIII
12 September 2016
 

This announcEment contains inside information

NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN WHOLE OR IN PART, DIRECTLY OR INDIRECTLY, IN, INTO OR FROM ANY JURISDICTION WHERE TO DO SO WOULD CONSTITUTE A VIOLATION OF THE RELEVANT LAWS OR REGULATIONS OF SUCH JURISDICTION

Neither the United States Securities and Exchange Commission (the "SEC") nor any United States securities commission or regulatory authority has approved or disapproved of the Offer or passed upon the fairness or merits of the Offer or determined whether this Announcement is accurate or complete. Any representation to the contrary is a criminal offence in the United States

For immediate release

 

12 September 2016

 

FULL AND FINAL CASH OFFER

BY

HARBOURVEST STRUCTURED SOLUTIONS III L.P. ("HARBOURVEST BIDCO" or the "OFFEROR")

FOR

SVG CAPITAL PLC ("SVG Capital" or the "Company")

 

Summary

 

·          HarbourVest today announces a full and final cash offer to be made by HarbourVest Bidco for the entire issued and to be issued ordinary share capital of SVG Capital, to be implemented by way of a takeover offer within the meaning of Part 28 of the Companies Act 2006 (the "Offer").

·          Under the terms of the Offer, SVG Capital Shareholders will receive 650 pence in cash for each SVG Capital Share they hold, valuing the entire existing issued share capital of SVG Capital at approximately £1,015 million.

·          HarbourVest believes the all-cash Offer is highly attractive for SVG Capital Shareholders, representing a compelling value proposition at a low discount to SVG Capital's last published net asset value ("NAV") (as at 30 April 2016) and a significant premium to the SVG Capital Share price as at 9 September 2016 (being the last Business Day prior to the commencement of the Offer Period).

·          The final Offer price of 650 pence for each SVG Capital Share represents:

o    a premium of approximately 14.7% over the Closing Price of 566.5 pence per SVG Capital Share on 9 September 2016, being the last Business Day prior to the commencement of the Offer Period;

o    a premium of approximately 23.1% to the average Closing Price of 528.1 pence per SVG Capital Share over the six month period ended 9 September 2016;

o    a discount of approximately 2.4% to SVG Capital's last published NAV per SVG Capital Share of 666 pence as at 30 April 2016. This discount is significantly lower than the long-term discount at which SVG Capital's Share price has traded as compared to its published NAV, for example:

§ a 20.2% average discount to published NAV per SVG Capital Share over the one year period ended 9 September 2016; and

§ a 20.3% average discount to published NAV per SVG Capital Share over the five year period ended 9 September 2016; and

a premium to the highest Closing Price for SVG Capital Shares since the onset of the global financial crisis in July 2008 (being 640 pence on 19 September 2008).

·          The Offer is expressed to be final, which means under the City Code that it cannot be increased.

·          HarbourVest Bidco has received an irrevocable undertaking from a SVG Capital Shareholder in respect of 31,221,994 SVG Capital Shares and letters of intent from SVG Capital Shareholders to accept the Offer in respect of a total of 35,419,782 SVG Capital Shares. These represent, in aggregate, approximately 20.0% and 22.7%, respectively, and together 42.7%, of the issued share capital of SVG Capital as at 9 September 2016 (being the last Business Day prior to the commencement of the Offer Period). The irrevocable undertaking remains binding in the event of a higher, or any other, bid or offer for SVG Capital.

·          Further details of the irrevocable undertaking and the letters of intent received by HarbourVest Bidco are set out in Appendix III to this Announcement.

·          The Offer is conditional upon, amongst other things, HarbourVest Bidco receiving valid acceptances in respect of, or otherwise acquiring or agreeing to acquire (whether pursuant to the Offer or otherwise), shares which carry, in aggregate, more than 50% of the voting rights then normally exercisable at general meetings of SVG Capital.

·          If the Offer becomes, or is declared, unconditional in all respects, HarbourVest expects that SVG Capital's investment trust status may be lost in respect of the then current and future accounting periods. HarbourVest expects that such loss of tax-exempt status as an investment trust would negatively impact SVG Capital's returns to its Shareholders by rendering its capital gains subject to corporation tax.

·          The Offer is being made by HarbourVest Bidco, an exempted limited partnership established for the purposes of the Offer. The Dover Street IX Fund is the sole limited partner of HarbourVest Bidco and the HarbourVest Bidco GP is the general partner of HarbourVest Bidco. Both HarbourVest Bidco GP and the Dover Street IX Fund are directly or indirectly managed by HarbourVest.

·          HarbourVest is an independent, global private markets investment specialist, with more than 30 years of experience and $42 billion in assets under management. HarbourVest's global platform offers clients investment opportunities through primary fund investments, secondary investments, and direct co-investments in commingled funds or separately managed accounts. HarbourVest has more than 340 employees, including more than 90 investment professionals across Asia, Europe and the Americas. This global team has committed more than $31 billion to newly-formed funds, completed nearly $14 billion in secondary purchases and invested $5 billion directly in operating companies.

·          SVG Capital plc is a publicly listed investment company incorporated in the United Kingdom and has been listed on the London Stock Exchange since 1996 with the ticker LSE: SVI. With net assets under management of over £1 billion, SVG Capital's stated strategy is to invest across the private equity asset class, through the cycle, providing its investors with a balanced portfolio of private equity assets. SVG Capital has been approved by HM Revenue & Customs as meeting the qualifying criteria for investment trust status and conducts its affairs so as to enable it to continue to qualify for such approval. SVG Capital is not a close company for taxation purposes.

·          SVG Capital Shareholders interested in selling their shares at the final Offer price of 650 pence per SVG Capital Share should contact Jefferies International Limited (using the contact details below), who have authority from HarbourVest to make a limited number of purchases of SVG Capital Shares other than pursuant to the Offer, such as in the open market or through privately negotiated purchases. Such purchases shall comply with the City Code, the rules of the London Stock Exchange and the provisions of the exemption provided under Rule 14e-5(b) of the United States Securities Exchange Act of 1934, as amended (the "Exchange Act").  Information about such purchases will be disclosed as and if required by applicable securities laws.

Commenting on the Offer, David Atterbury, Managing Director of HarbourVest, said:

"We believe that our final cash offer provides full, compelling and immediate cash value to the shareholders of SVG Capital at a fair and significantly lower discount to both SVG Capital's last published NAV (as at 30 April 2016) and the average discount to NAV of its peers (as at 9 September 2016, based on information sourced from Morningstar).

While our offer does not currently have the recommendation of the board of SVG Capital, we look forward to a constructive dialogue with them in order to crystallise the certainty of value, today and in cash, to its shareholders. Importantly, we believe that the substantial level of irrevocable undertaking and letters of intent (being approximately 20.0% and 22.7%, respectively, and together 42.7%, of the share capital of SVG Capital in issue on 9 September 2016) received from some of the largest shareholders of SVG Capital demonstrates the attractive nature of the offer."

 

This summary should be read in conjunction with, and is subject to, the full text of the following Announcement and appendices to this Announcement. 

 

Appendix I sets out the Conditions and certain further terms of the Offer. Appendix II sets out the sources of information and bases of calculation contained in this Announcement. Appendix III sets out details of the irrevocable undertaking and the letters of intent received by HarbourVest Bidco in relation to the Offer that are referred to in this Announcement. Certain terms used in this Announcement are defined in Appendix IV.

 

The Offer will be subject to the Conditions and further terms set out in Appendix I of this Announcement and to the full terms and conditions that will be set out in the Offer Document and, in respect of SVG Capital Shares held in certificated form, the Form of Acceptance.

 

It is intended that the Offer Document and Form of Acceptance containing further details of the Offer will be despatched to SVG Capital Shareholders (other than to persons in a Restricted Jurisdiction) as soon as practicable, and in any event within 28 days after the date of this Announcement (unless agreed otherwise with the Panel).

 

Enquiries:

 

HarbourVest Partners, LLC

Tel:     +44 (0) 20 7151 4211

Laura Thaxter


[email protected]




Jefferies International Limited

Tel:     +44 (0) 20 7029 8000

(Sole Financial Adviser)


Gary Gould


Tariq Hussain


Stuart Klein




(Equity Sales)


Tom Harris

+44 (0) 20 7898 7792



FTI Consulting LLP

Ed Berry/Ed Bridges

[email protected]

[email protected]

Tel:     +44 (0) 20 3727 1067

+44 (0) 20 3727 1046





Important Notice Relating to the Financial Adviser

Jefferies International Limited ("Jefferies"), which is authorised and regulated in the United Kingdom by the FCA, is acting as exclusive financial adviser to HarbourVest and HarbourVest Bidco and no one else in connection with the Offer and will not be responsible to anyone other than HarbourVest and HarbourVest Bidco for providing the protections afforded to clients of Jefferies or for providing advice in relation to the contents of this Announcement, in connection with the Offer or any other matter referred to herein or in the Offer Document.

Further Information

This Announcement is for information purposes only. It is not intended to and does not constitute, or form part of, an offer or invitation or the solicitation of any offer to sell or purchase any securities or the solicitation of any offer to otherwise acquire, subscribe for, sell or otherwise dispose of any securities, or the solicitation of any vote or approval of an offer to buy securities in any jurisdiction, pursuant to the Offer or otherwise. The Offer will be made solely by means of the Offer Document and, in respect of SVG Capital Shares held in certificated form, the Form of Acceptance, which will contain the full terms and conditions of the Offer, including details of how the Offer may be accepted. Any decision in respect of, or other response to, the Offer should be made only on the basis of the information contained in those documents. SVG Capital Shareholders are advised to read the formal documentation in relation to the Offer carefully once it has been despatched.

This Announcement does not constitute a prospectus or prospectus equivalent document.

Overseas Jurisdictions

The release, publication or distribution of this Announcement in, and the availability of the Offer to persons who are residents, citizens or nationals of, jurisdictions other than the United Kingdom may be restricted by laws and/or regulations of those jurisdictions. Therefore any such persons should inform themselves about and observe any applicable legal or regulatory requirements in their jurisdiction. Any failure to comply with the applicable requirements may constitute a violation of the laws and/or regulations of any such jurisdiction. Further details in relation to overseas shareholders will be contained in the Offer Document.

In particular, copies of this Announcement and any formal documentation relating to the Offer are not being, and must not be, directly or indirectly, mailed or otherwise forwarded, distributed or sent in or into or from any Restricted Jurisdiction and persons receiving such documents (including, without limitation, any agents, custodians, nominees and trustees) must not mail or otherwise forward, distribute or send them in or into or from any Restricted Jurisdiction. Unless otherwise determined by the Offeror or required by the City Code, and permitted by applicable law and regulation, the Offer is not being, and will not be, made, directly or indirectly, in or into or from, or by the use of mails or any means or instrumentality (including, but not limited to, facsimile, e-mail or other electronic transmission, telex or telephone) of interstate or foreign commerce of, or of any facility of a national, state or other securities exchange of, any Restricted Jurisdiction and the Offer may not be capable of acceptance by any such use, means, instrumentality or facilities.

The receipt of cash pursuant to the Offer by SVG Capital Shareholders may be a taxable transaction under applicable national, state or local, as well as foreign and other, tax laws. Each SVG Capital Shareholder is urged to consult its independent professional adviser regarding the tax consequences of accepting the Offer.

This Announcement has been prepared in compliance with English law, the rules of the London Stock Exchange and the City Code and the information disclosed may not be the same as that which would have been disclosed if this Announcement had been prepared in accordance with the laws of jurisdictions outside of England and Wales.

Notice to US Investors

The Offer is being made to holders of SVG Capital Shares resident in the United States in reliance on, and compliance with, Section 14(e) of the Exchange Act, and Regulation 14E thereunder. The Offer is being made in the United States by the Offeror and no one else.

The Offer is subject to disclosure requirements, which are different from certain United States disclosure requirements.

Furthermore, the payment and settlement procedure with respect to the Offer will comply with the relevant United Kingdom rules, which differ from US payment and settlement procedures, particularly with regard to the date of payment of consideration.

To the extent permissible under applicable securities laws, Jefferies and its affiliates may from time to time purchase, or enter into arrangements to purchase, SVG Capital Shares either as principal or agent before and during the period when the Offer remains open for acceptance. Pursuant to Rule 14e-5(b) of the Exchange Act, any affiliate of a financial adviser to the HarbourVest Group may from time to time make purchases of, or arrangements to purchase, SVG Capital Shares outside of the United States, other than pursuant to the Offer, before or during the period in which the Offer is open for submission of tenders, so long as the acquisitions or arrangements comply with the provisions of the exemption provided under Rule 14e-5.  Pursuant to Rule 14e-5 of the Exchange Act, HarbourVest Bidco, its affiliates, nominees or brokers (acting as agents), and a financial adviser and its affiliates, may from time to time make purchases of, or arrangements to purchase, the SVG Capital Shares, other than pursuant to the Offer, before or during the period in which the Offer is open for submission of tenders so long as those acquisitions or arrangements comply with the provisions of the exemption provided under Rule 14e-5 of the Exchange Act.  These purchases may occur either in the open market at prevailing prices or in private transactions at negotiated prices. Information about such purchases will be disclosed as and if required by applicable securities laws.

Forward Looking Statements

This Announcement contains statements about HarbourVest, HarbourVest Bidco and the SVG Capital Group that are or may be forward looking statements. All statements other than statements of historical facts included in this Announcement may be forward looking statements. Without limitation, any statements preceded or followed by or that include the words "targets", "plans" "believes", "expects", "aims"," intends", "will", "may", "anticipates", "estimates", "projects" or, words or terms of similar substance or the negative thereof, are forward looking statements. Forward looking statements include statements relating to the following: (i) statements relating to the expected benefits of the acquisition to HarbourVest, the Wider HarbourVest Group and/or the SVG Capital Group; (ii) background to and reasons for the Offer; (iii) expectations of the impact of the acquisition on revenue and earnings of HarbourVest, the Wider HarbourVest Group and/or the SVG Capital Group; (iv) future capital expenditures, expenses, revenues, earnings, synergies, economic performance, indebtedness, financial condition, dividend policy, losses and future prospects; (v) business and management strategies and the expansion and growth of HarbourVest's, the Wider HarbourVest Group's and/or the SVG Capital Group's operations and potential synergies resulting from the Offer; and (vi) the effects of government regulation on HarbourVest's, the HarbourVest Group's and/or the SVG Capital Group's business.

Such forward looking statements involve risks and uncertainties that could significantly affect expected results and are based on certain key assumptions. Many factors could cause actual results to differ materially from those projected or implied in any forward looking statements, including risks relating to the successful combination of SVG Capital with HarbourVest; higher than anticipated costs relating to the combination of SVG Capital with HarbourVest or investment required in SVG Capital to realise expected benefits and facts relating to SVG Capital that may impact the timing or amount of benefit realised from the acquisition that are unknown to HarbourVest. Due to such uncertainties and risks, readers are cautioned not to place undue reliance on such forward looking statements, which speak only as of the date hereof. Each of HarbourVest and HarbourVest Bidco disclaims any obligation to update any forward looking or other statements contained herein, except as required by applicable law.

No Profit Forecasts or Estimates

Nothing herein contained shall be deemed to be a profit forecast, projection or estimate for any period unless otherwise stated, and no statement in this Announcement should be interpreted to mean that earnings or earnings per SVG Capital Share for the current or future financial years will necessarily match or exceed the historical published earnings or earnings per SVG Capital Share.

Dealing Disclosure Requirements of the City Code

Under Rule 8.3(a) of the City Code, any person who is interested in 1% or more of any class of relevant securities of an offeree company or of any securities exchange offeror (being any offeror other than an offeror in respect of which it has been announced that its offer is, or is likely to be, solely in cash) must make an Opening Position Disclosure following the commencement of the offer period and, if later, following the announcement in which any securities exchange offeror is first identified. An Opening Position Disclosure must contain details of the person's interests and short positions in, and rights to subscribe for, any relevant securities of each of: (i) the offeree company; and (ii) any securities exchange offeror(s). An Opening Position Disclosure by a person to whom Rule 8.3(a) applies must be made by no later than 3.30 p.m. (London time) on the 10th Business Day following the commencement of the offer period and, if appropriate, by no later than 3.30 p.m. (London time) on the 10th Business Day following the announcement in which any securities exchange offeror is first identified. Relevant persons who deal in the relevant securities of the offeree company or of a securities exchange offeror prior to the deadline for making an Opening Position Disclosure must instead make a Dealing Disclosure.

Under Rule 8.3(b) of the City Code, any person who is, or becomes, interested in 1% or more of any class of relevant securities of the offeree company or of any securities exchange offeror must make a Dealing Disclosure if the person deals in any relevant securities of the offeree company or of any securities exchange offeror. A Dealing Disclosure must contain details of the dealing concerned and of the person's interests and short positions in, and rights to subscribe for, any relevant securities of each of: (i) the offeree company; and (ii) any securities exchange offeror(s), save to the extent that these details have previously been disclosed under Rule 8. A Dealing Disclosure by a person to whom Rule 8.3(b) applies must be made by no later than 3.30 p.m. (London time) on the Business Day following the date of the relevant dealing.

If two or more persons act together pursuant to an agreement or understanding, whether formal or informal, to acquire or control an interest in relevant securities of an offeree company or a paper offeror, they will be deemed to be a single person for the purpose of Rule 8.3.

Opening Position Disclosures must also be made by the offeree company and by any offeror and Dealing Disclosures must also be made by the offeree company, by any offeror and by any persons acting in concert with any of them (see Rules 8.1, 8.2 and 8.4 of the City Code).

Details of the offeree and offeror companies in respect of whose relevant securities Opening Position Disclosures and Dealing Disclosures must be made can be found in the Disclosure Table on the Takeover Panel's website at http://www.thetakeoverpanel.org.uk, including details of the number of relevant securities in issue, when the offer period commenced and when any offeror was first identified. If you are in any doubt as to whether you are required to make an Opening Position Disclosure or a Dealing Disclosure, you should contact the Panel's Market Surveillance Unit on +44 (0)20 7638 0129.

Publication on Website and Availability of Hard Copies

A copy of this Announcement and the documents required to be published pursuant to Rule 26.1 of the City Code will be made available, subject to certain restrictions relating to persons resident in any Restricted Jurisdiction, on HarbourVest's website at http://www.harbourvest.com/offer-2016 by no later than 12 noon (London time) on the Business Day following the date of this Announcement until the end of the Offer Period. For the avoidance of doubt, the contents of that website are not incorporated into, and do not form part of, this Announcement.

SVG Capital Shareholders may request a hard copy of this Announcement by contacting Edward Berry at FTI Consulting LLP during business hours on 0203 727 1046 or if calling from outside the UK on +44 203 727 1046. Calls are charged at the standard geographic rate and will vary by provider. Calls outside the United Kingdom will be charged at the applicable international rate. You may also request that all future documents, announcements and information to be sent to you in relation to the Offer should be in hard copy form.

Information Relating to SVG Capital Shareholders

Please be aware that addresses, electronic addresses and certain other information provided by SVG Capital Shareholders, persons with information rights and other relevant persons for the receipt of communication from the Company may be provided to the Offeror during the Offer Period as required under Section 4 of Appendix 4 of the City Code.

Rounding

Certain figures included in this Announcement have been subjected to rounding adjustments. Accordingly, figures shown for the same category presented in different tables may vary slightly and figures shown as totals in certain tables may not be an arithmetic aggregation of the figures that precede them.

 

 

NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN WHOLE OR IN PART, DIRECTLY OR INDIRECTLY, IN, INTO OR FROM ANY JURISDICTION WHERE TO DO SO WOULD CONSTITUTE A VIOLATION OF THE RELEVANT LAWS OR REGULATIONS OF SUCH JURISDICTION

Neither the United States Securities and Exchange Commission (the "SEC") nor any United States securities commission or regulatory authority has approved or disapproved of the Offer or passed upon the fairness or merits of the Offer or determined whether this Announcement is accurate or complete. Any representation to the contrary is a criminal offence in the United States

For immediate release

12 September 2016

 

FULL AND FINAL CASH OFFER

BY

HARBOURVEST STRUCTURED SOLUTIONS III L.P. ("HarbourVest Bidco" or the "OFFEROR")

FOR

SVG CAPITAL PLC ("SVG Capital" or the "Company")

 

1.            Introduction

 

HarbourVest today announces the terms of a full and final cash offer to be made by HarbourVest Bidco to acquire the entire issued and to be issued share capital of SVG Capital, further details of which are set out below.

 

2.            The Offer

 

The Offer, which will be implemented by means of a takeover offer within the meaning of Part 28 of the Companies Act 2006 and will be made subject to the Conditions and further terms summarised below and in Appendix I to this Announcement and those to be set out in the Offer Document, will be made on the following terms:

 

for every SVG Capital Share

650 pence in cash

 

The Offer values the entire existing issued share capital of SVG Capital at approximately £1,015 million.

 

The final Offer price of 650 pence for each SVG Capital Share represents:

 

o    a premium of approximately 14.7% to the Closing Price of 566.5 pence per SVG Capital Share on 9 September 2016, being the last Business Day prior to the commencement of the Offer Period;

o    a premium of approximately 23.1% to the average Closing Price of 528.1 pence per SVG Capital Share over the six month period ended 9 September 2016;

o    a discount of approximately 2.4% to SVG Capital's last published NAV per SVG Capital Share of 666 pence as at 30 April 2016. This discount is significantly lower than the long-term discount at which SVG Capital's Share price has traded as compared to its published NAV, for example:

§ a 20.2% average discount to published NAV per SVG Capital Share over the one year period ended 9 September 2016; and

§ a 20.3% average discount to published NAV per SVG Capital Share over the five year period ended 9 September 2016; and

o    a premium to the highest Closing Price for SVG Capital Shares since the onset of the global financial crisis in July 2008 (being 640 pence on 19 September 2008).

The Offer is expressed to be final, which means under the City Code that it cannot be increased.

 

3.            Background to and reasons for the Offer

 

HarbourVest believes the final Offer price of 650 pence per SVG Capital Share all in cash is highly attractive for all SVG Capital Shareholders, providing a liquidity event as well as representing a compelling value proposition. The Offer represents a premium of 14.7% to the Closing Price of 566.5 pence per SVG Capital Share as at 9 September 2016 (being the last Business Day prior to the commencement of the Offer Period), a discount of 2.4% to SVG Capital's last published NAV of 666 pence as at 30 April 2016 and a premium to the highest Closing Price for SVG Capital Shares since the onset of the global financial crisis in July 2008 (being 640 pence on 19 September 2008).

 

The compelling nature of this Offer is evidenced by the level of irrevocable undertaking and letters of intent to accept the Offer received by HarbourVest Bidco in respect of 31,221,994 SVG Capital Shares and 35,419,782 SVG Capital Shares, respectively. These represent, in aggregate, approximately 20.0% and 22.7%, respectively, and together 42.7%, of the share capital of SVG Capital in issue on 9 September 2016 (being the last Business Day prior to the commencement of the Offer Period). Further details of the irrevocable undertaking and the letters of intent received by HarbourVest Bidco are set out in Appendix III to this Announcement.

 

HarbourVest is an independent, global private markets investment specialist, with more than 30 years of experience and over $42 billion in assets under management, and is an experienced long-term owner of private equity fund assets. Through its $806 million acquisition of Absolute Private Equity AG in 2011 and the $1.4 billion acquisition of the Conversus Capital, L.P. portfolio in 2012, HarbourVest has experience in acquiring listed private equity vehicles, offering attractive exit prices for shareholders of those companies at discounts to NAV of 27.8% and 14%, respectively.

 

HarbourVest understands that a number of SVG Capital's Shareholders have taken advantage of opportunities to partially exit their holdings through tender offers and share buybacks conducted by SVG Capital since September 2011 at varying discounts to published NAV. SVG Capital's most recent tender offer, completed on 25 January 2016 at a price per SVG Capital Share of 565 pence, was significantly oversubscribed and saw 124,643,446 SVG Capital Shares validly tendered (73.7% of shares outstanding) for a possible 8,849,557 SVG Capital Shares purchased (5.2% of shares outstanding).

 

HarbourVest recognises that SVG Capital's last published NAV of 666 pence per SVG Capital Share was as at 30 April 2016, which was prior to the UK's referendum on membership of the European Union which took place on 23 June 2016. Since 30 April 2016, the sterling dollar exchange rate and the sterling euro exchange rate have moved -9.5% and -7.5%, respectively (as at 9 September 2016, being the last Business Day prior to the commencement of the Offer Period). According to SVG Capital's audited annual report and accounts for the year ended 31 January 2016, as at such date 31% of SVG Capital's financial assets were denominated in euros and 54% were denominated in US dollars. HarbourVest notes that any unrealised foreign exchange movements are inherently volatile and uncertain in their nature.

 

Following the onset of the global financial crisis in 2008, SVG Capital's NAV fell to an historic low of 171 pence per SVG Capital Share (based on SVG Capital's published NAV on 30 June 2009), one reason being the performance of SVG Capital's then existing commitments to private equity funds. HarbourVest notes that the general global economic environment has improved since that date. SVG Capital's published NAV has since been recovering as the financial performance and valuations of SVG Capital's underlying portfolio companies have improved and SVG Capital has seen realisations of certain of its portfolio assets.  However, SVG Capital's investment portfolio as at 30 April 2016 comprised £311 million of funds raised since 2012 (representing 41% of SVG Capital's last published NAV (as at 30 April 2016)) and £377 million of related uncalled commitments, which was expected to increase to £462 million following a pending commitment to a US-based manager. HarbourVest notes that, of SVG Capital's commitments to funds raised since 2012, a significant majority were made to funds with vintage years of 2014 or later.  In HarbourVest's experience, portfolios of funds tend to experience flat or negative performance during their initial years due to (i) the natural pace of investment over the first three to four years, (ii) underlying portfolio companies requiring time to develop and generate meaningful investment gains, and (iii) fees and expenses of the underlying funds outweighing any investment gains (this is commonly referred to as the "j-curve").

 

In determining the final Offer price, HarbourVest has taken into account both recent movements in foreign exchange rates and SVG Capital's short-term growth prospects as far as practicable. HarbourVest therefore considers that the all-cash nature of the Offer allows SVG Capital Shareholders to realise their investment at a timely point in SVG Capital's development.

 

HarbourVest believes that the London-listed private equity fund sector is subject to demand factors that contribute to discounts to NAV. The sector was particularly impacted during the 2008 global financial crisis with some discounts to NAV reaching levels of 60%, with the sector also experiencing significant levels of over-commitments, high leverage levels and balance sheet issues, which in some cases required London-listed private equity funds to restructure. HarbourVest believes that these historical issues have contributed to ongoing lower levels of demand, as evidenced by the discounts to NAV at which the shares of SVG Capital's London-listed private equity fund peer group trade, with average discounts to NAV (based on information sourced from Morningstar) across that peer group of 21.0% and 22.2% over the one and five year periods respectively ended on 9 September 2016 (being the last Business Day prior to the commencement of the Offer Period).

 

As further explained in paragraph 13 below, HarbourVest intends to: (i) if it acquires the requisite number of SVG Capital Shares, procure that SVG Capital makes an application for cancellation, respectively, of the trading in SVG Capital Shares on the London Stock Exchange's main market for listed securities and of the listing of SVG Capital Shares on the premium listing segment of the Official List; and (ii) manage an orderly run-off of SVG Capital's portfolio over an anticipated period of 10 to 12 years. Furthermore, as explained in paragraph 8 below, implementation of the Offer may result in the loss of SVG Capital's tax-exempt status as an investment trust.

 

4.            Irrevocable undertaking and letters of intent

 

HarbourVest Bidco has received an irrevocable undertaking to accept the Offer from Coller International Partners V-A, L.P. in respect of 31,221,994 SVG Capital Shares, representing approximately 20.0% of the issued share capital of SVG Capital as at 9 September 2016 (being the last Business Day prior to the commencement of the Offer Period). The irrevocable undertaking remains binding in the event of a higher, or any other, bid or offer for SVG Capital.

 

HarbourVest Bidco has also received letters of intent to accept the Offer from Aviva Plc and its subsidiaries, Legal & General Investment Management, Old Mutual Plc and Coller International Partners V-A, L.P. in respect of a total of 35,419,782 SVG Capital Shares (in relation to Coller International Partners V-A, L.P., the intention (in respect of 10,263,458 SVG Capital Shares) is stated in the irrevocable undertaking). These represent, in aggregate, approximately 22.7% of the issued share capital of SVG Capital in issue on 9 September 2016 (being the last Business Day prior to the commencement of the Offer Period).

 

The irrevocable undertaking and the letters of intent represent a total of 66,641,776 SVG Capital Shares and, in aggregate, approximately 42.7% of the issued share capital of SVG Capital as at 9 September 2016 (being the last Business Day prior to the commencement of the Offer Period).

 

Further details of the irrevocable undertaking and the letters of intent received by HarbourVest Bidco are set out in Appendix III to this Announcement.

 

5.            Information about HarbourVest, the Dover Street IX Fund and HarbourVest Bidco

 

HarbourVest Bidco is an exempted limited partnership established under the laws of the Cayman Islands for the purposes of the Offer. The Dover Street IX Fund is the sole limited partner of HarbourVest Bidco and the HarbourVest Bidco GP is the general partner of HarbourVest Bidco. Both HarbourVest Bidco GP and the Dover Street IX Fund are directly or indirectly managed by HarbourVest. HarbourVest Bidco has not traded since its date of registration by the Cayman Islands Registrar of Limited Partnerships on 15 August 2016 and has not entered into any obligations, other than in connection with the Offer. HarbourVest Bidco has not prepared any historical financial accounts.

 

HarbourVest is an independent, global private markets investment specialist, with more than 30 years of experience and $42 billion in assets under management. HarbourVest's global platform offers clients investment opportunities through primary fund investments, secondary investments, and direct co-investments in commingled funds or separately managed accounts. HarbourVest has more than 340 employees, including more than 90 investment professionals across Asia, Europe and the Americas. This global team has committed more than $31 billion to newly-formed funds, completed nearly $14 billion in secondary purchases and invested $5 billion directly in operating companies.

 

The Dover Street IX Fund is a Scottish limited partnership that was organised on 15 September 2015. The Dover Street IX Fund focuses on and invests in the private equity secondary market with sellers of all types, including those with smaller or more fragmented asset pools. The primary objective of the Dover Street IX Fund is to invest in a diversified portfolio of private equity and private equity-related investments, principally purchased in secondary market transactions. The Dover Street IX Fund seeks to create a portfolio primarily comprised of limited partnership interests in buyout, venture, growth equity and other private equity funds. As at 9 September 2016, being the last Business Day prior to the commencement of the Offer Period, the Dover Street IX Fund, through its limited partners, had $4.1 billion of capital commitments available for investment.

 

6.            Information about SVG Capital

 

SVG Capital is a publicly listed company and is an "investment company" as defined under Section 833 of the Companies Act 2006. SVG Capital's Shares have a premium listing on the Official List of the UK Listing Authority and are traded on the London Stock Exchange. SVG Capital was launched in 1996 as Schroder Ventures International Investment Trust plc, a private equity fund of funds launched to invest exclusively in Permira LP funds. At that time Permira was called Schroder Ventures, the management entity then being a partnership with Schroders plc before becoming independent in 2001.

 

SVG Capital is an international private equity investor whose stated strategy is to invest across the private equity asset class, through the cycle, providing its investors with a balanced portfolio of private equity assets.

 

SVG Capital has been approved by HM Revenue & Customs as meeting the qualifying criteria for investment trust status and conducts its affairs so as to enable it to continue to qualify for such approval. SVG Capital is not a close company for taxation purposes.

 

According to SVG Capital's audited annual report and accounts for the year ended 31 January 2016, as at such date SVG Capital's net assets were £1,052 million and shareholders' funds were £1,052 million and the audited NAV per SVG Capital Share was 654 pence. The unaudited NAV per SVG Capital Share as at 30 April 2016 was 666 pence (this being the last announced NAV per SVG Capital Share) and the Closing Price per SVG Capital Share was 566.5 pence as at 9 September 2016 (being the last Business Day prior to the commencement of the Offer Period).

 

Additional information about SVG Capital can be found at its website, www.svgcapital.com.

 

7.            Financing the Offer

 

The Dover Street IX Fund has agreed to finance, by one or more capital contributions into HarbourVest Bidco, the entire cash consideration payable to SVG Capital Shareholders pursuant to the Offer. As at 9 September 2016, being the last Business Day prior to the commencement of the Offer Period, the Dover Street IX Fund, through its limited partners, had $4.1 billion of capital commitments available for investment. Some or all of the consideration may alternatively, in certain circumstances, be drawn from existing standby credit facilities which are available to the Dover Street IX Fund.

 

Jefferies, exclusive financial adviser to HarbourVest and HarbourVest Bidco, is satisfied that sufficient resources are available to HarbourVest Bidco to satisfy in full the cash consideration payable to SVG Capital Shareholders under the terms of the Offer.

 

8.            Investment trust status

 

As described in paragraph 6 above, according to SVG Capital's audited annual report and accounts for the year ended 31 January 2016, SVG Capital has been approved by HM Revenue & Customs as meeting the qualifying criteria for investment trust status and is not a close company for taxation purposes. If the Offer becomes, or is declared, unconditional in all respects, HarbourVest expects that SVG Capital's investment trust status may be lost in respect of the then current and future accounting periods. HarbourVest expects that such loss of tax-exempt status as an investment trust would negatively impact SVG Capital's returns to its Shareholders by rendering its capital gains subject to corporation tax.

 

9.            Management, employees and locations

 

HarbourVest confirms that, if the Offer becomes or is declared unconditional in all respects, the existing employment rights, including pension rights, of all employees of the SVG Capital Group will be observed at least to the extent required by applicable law.

 

Following completion of the Offer, the employee resources of the SVG Capital Group, including any requirement to change the principal locations, will be considered in light of HarbourVest's overall strategy which comprises a cessation of new investments before moving to a period of natural run-off (as described in paragraph 12 below). HarbourVest hopes to work closely with the incumbent management team of SVG Capital to transition the SVG Capital Group during the change of ownership before undertaking a period of review of the on-going requirements of the SVG Capital Group. In time, the day-to-day management and administration of SVG Capital are likely to be consolidated into existing HarbourVest reporting structures and systems and will thus become redundant. This run-off and consolidation will result in a reduction in the number of SVG Capital employees; however, this will be subject to review by HarbourVest following completion of the Offer.

 

10.          SVG Capital Share Schemes

 

The Offer will extend to any SVG Capital Shares unconditionally allotted or issued fully paid (or credited as fully paid) to satisfy the exercise of existing options or vesting of awards under the SVG Capital Share Schemes whilst the Offer remains open for acceptances.

 

If the Offer becomes or is declared unconditional in all respects, to the extent that such options or awards remain unexercised or have not lapsed, HarbourVest Bidco will make appropriate proposals to option holders and holders of awards under the SVG Capital Share Schemes in due course.

11.          Disclosure of interests in SVG Capital

 

Save in respect of the irrevocable undertaking and the letters of intent described in Appendix III, as at the date of this Announcement, neither HarbourVest Bidco nor, so far as HarbourVest is aware, any person acting in concert (within the meaning of the City Code) with HarbourVest Bidco for the purposes of the Offer, has any interest in, right to subscribe for, or has borrowed or lent any SVG Capital Shares or securities convertible or exchangeable into SVG Capital Shares (including pursuant to any long exposure, whether conditional or absolute, to changes in the prices of securities) or right to subscribe for or purchase the same or holds any options (including traded options) in respect of or has any right to acquire any SVG Capital Shares or derivatives referenced to SVG Capital Shares ("SVG Capital Securities"), nor does any such person have any short position (whether conditional or absolute and whether in the money or otherwise) including any short position under a derivative, any agreement to sell or any delivery obligation or right to require another person to purchase or take delivery in relation to SVG Capital Securities.

In the interests of maintaining confidentiality before this Announcement, HarbourVest Bidco has not yet completed its enquiries in respect of the matters referred to in this paragraph of certain parties deemed to be acting in concert with HarbourVest Bidco for the purposes of the Offer. Enquiries of such parties will be completed as soon as practicable following the date of this Announcement. In accordance with Note 2(a)(i) on Rule 8 of the City Code, further disclosures, if any, required in respect of such parties will be made as soon as possible and in any event by no later than 12 noon (London time) on the day falling 10 Business Days after the date of this Announcement.

 

12.          Orderly run-off

 

If the Offer becomes, or is declared, unconditional in all respects, HarbourVest intends to change the investment policy of SVG Capital and cease making new investments. HarbourVest does not expect to make any significant disposals of investments but will instead continue to fund existing obligations from cash held in SVG Capital. Through this continued funding the portfolio will mature in the medium term before moving into a period of natural run-off in ten to twelve years' time as the underlying funds become fully realised. HarbourVest may consider asset disposals as it manages down SVG Capital's assets.

HarbourVest, as an experienced long-term owner of private equity fund assets, believes it can manage the funds currently held by SVG Capital through to maturity in an efficient manner.

13.          Compulsory acquisition, delisting and cancellation of trading

 

If the Offer becomes, or is declared, unconditional in all respects and HarbourVest Bidco receives valid acceptances in respect of SVG Capital Shares which, together with the SVG Capital Shares acquired, or agreed to be acquired, before or during the Offer by HarbourVest Bidco, represent not less than 75% of the voting rights attaching to the SVG Capital Shares, HarbourVest Bidco intends to procure that SVG Capital will make an application for cancellation, respectively, of the trading in SVG Capital Shares on the London Stock Exchange's main market for listed securities and of the listing of SVG Capital Shares on the premium listing segment of the Official List and HarbourVest Bidco will seek to re-register SVG Capital as a private limited company. A notice period of not less than 20 Business Days before the cancellation will commence on the date on which the Offer becomes or is declared unconditional in all respects provided HarbourVest Bidco has attained 75% or more of the voting rights as described above or otherwise as soon as HarbourVest Bidco attains 75% or more of the voting rights of SVG Capital as described above.

 

Delisting would significantly reduce the liquidity and marketability of any SVG Capital Shares not assented to the Offer.

 

If HarbourVest Bidco receives acceptances of the Offer in respect of, and/or otherwise acquires not less than 90% of the SVG Capital Shares to which the Offer relates by nominal value and voting rights attaching to such shares, HarbourVest Bidco intends to exercise its rights pursuant to sections 974 to 991 of the Companies Act 2006 to acquire compulsorily, on the same terms as the Offer, the remaining SVG Capital Shares in respect of which the Offer has not at such time been accepted.

 

14.          Overseas SVG Capital Shareholders

 

The release, publication or distribution of this Announcement and the availability of the Offer to persons not resident in the United Kingdom may be affected by the laws of the jurisdiction in which they are resident. Persons who are resident in any jurisdiction or territory other than the United Kingdom should obtain professional advice and observe any applicable legal or regulatory requirements. Further details in relation to overseas Shareholders will be contained in the Offer Document. If you are in any doubt, you should consult your professional adviser in the relevant jurisdiction without delay.

 

15.          Documents available on website

 

Copies of the following documents will, by no later than 12 noon on the Business Day following the date of this Announcement, be published on HarbourVest's website at http://www.harbourvest.com/offer-2016 and will remain available for inspection on such website until the end of the Offer Period:

15.1

this Announcement; and

15.2

the irrevocable undertaking and the letters of intent described in Appendix III.

 

16.          Conditions and timetable

 

The Offer is conditional upon, amongst other things, the FCA consenting to the acquisition by HarbourVest of control (as construed in accordance with the provisions of Part XII of FSMA) of SVG Capital (the "FCA Condition"). Appendix I to this Announcement sets out the Conditions (including the FCA Condition) and further terms to which the Offer will be subject. Under Rule 31.7 of the City Code, except with the consent of the Panel, all the Conditions must be satisfied or the Offer will lapse within 21 days of the first closing date or the date the Offer becomes or is declared unconditional as to acceptances, whichever is the later. Rule 31.7 also provides that the Panel's consent to an extension will normally only be granted, broadly, if the outstanding condition involves a material official authorisation or regulatory clearance relating to the transaction.

 

The timetable for obtaining the consent of the FCA is controlled by the FCA. This timetable differs from, and can be longer than, the conventional timetable for an offer under the City Code. It is expected that it will take up to approximately 12 weeks from the date of this Announcement to satisfy the FCA Condition. In the event that the FCA Condition is not satisfied within 21 days of the first closing date or the date the Offer becomes or is declared unconditional as to acceptances, whichever is the later, the Panel has indicated that it would be prepared to consider extending the 21 day period referred to above in Rule 31.7 of the City Code to provide further time for the FCA Condition to be satisfied.

 

SVG Capital Shareholders who have accepted the Offer will not be able to withdraw their acceptances from the date on which the Offer becomes or is declared unconditional as to acceptances until the date on which the Offer becomes or is declared wholly unconditional or lapses. Accordingly, if the 21 day period in Rule 31.7 is extended by the Panel in the manner described above, SVG Capital Shareholders will not be able to withdraw acceptances for the duration of this extended period.

 

If the Offer becomes or is declared unconditional as to acceptances and, subsequently, becomes or is declared wholly unconditional, HarbourVest has agreed to keep the Offer open for acceptances for at least 14 days following the date on which the Offer becomes or is declared wholly unconditional.

 

17.          General

 

The Offer will extend to all SVG Capital Shares unconditionally allotted or issued (including to satisfy the exercise of options granted under the SVG Capital Share Schemes) after the date of this Announcement and before the Offer closes (or such earlier date as HarbourVest Bidco may, in accordance with the Conditions and further terms of the Offer, decide).

 

The SVG Capital Shares will be acquired by HarbourVest Bidco fully paid and free from all liens, equitable interests, charges and encumbrances and other interests whatsoever and together with all rights now or hereafter attaching thereto, including the right to receive in full and retain all dividends and other distributions (if any) declared, made or paid on or after the date of this Announcement. If any such dividend or other distribution is declared, made or paid by SVG Capital on or after the date of this Announcement, HarbourVest Bidco will have the right to reduce the Offer consideration by the amount of such dividend or distribution.

 

It is intended that the Offer Document containing further details of the Offer and the Form of Acceptance will be despatched to SVG Capital Shareholders (other than to persons in a Restricted Jurisdiction) as soon as practicable after the date of this Announcement, and in any event within 28 days of this Announcement (unless agreed otherwise with the Panel). The Offer will be governed by the laws of England and will be subject to the applicable requirements of the City Code, the FCA, the London Stock Exchange and applicable laws (including applicable US federal securities laws).

 

The acquisition of SVG Capital Shares under the Offer is proposed to be implemented by way of a takeover offer within the meaning of Part 28 of the Companies Act 2006 but, in the event that the SVG Capital Board recommends the Offer, HarbourVest Bidco may, with the agreement of the Panel, elect to implement the acquisition by way of a scheme of arrangement pursuant to Part 26 of the Companies Act 2006.

 

The Offer will be made subject to the Conditions and further terms set out in Appendix I to this Announcement and the full terms and conditions which will be set out in the Offer Document. Details of the bases of calculation and sources of certain information set out in this Announcement are included in Appendix II. Appendix III sets out details of the irrevocable undertaking and the letters of intent received by HarbourVest Bidco in relation to the Offer that are referred to in this Announcement. Certain terms used in this Announcement are defined in Appendix IV.

 

SVG Capital Shareholders interested in selling their shares at the final Offer price of 650 pence per SVG Capital Share should contact Jefferies International Limited (using the contact details below), who have authority from HarbourVest to make a limited number of purchases of SVG Capital Shares other than pursuant to the Offer, such as in the open market or through privately negotiated purchases. Such purchases shall comply with the City Code, the rules of the London Stock Exchange and the provisions of the exemption provided under Rule 14e-5(b) of the Exchange Act.  Information about such purchases will be disclosed as and if required by applicable securities laws.

 

This Announcement is being made pursuant to Rule 2.7 of the City Code.

 

Enquiries:

 

HarbourVest Partners, LLC

Tel:     +44 (0) 20 7151 4211

Laura Thaxter


[email protected]




Jefferies International Limited

Tel:     +44 (0) 20 7029 8000

(Sole Financial Adviser)


Gary Gould


Tariq Hussain


Stuart Klein

 


(Equity Sales)


Tom Harris

+44 (0) 20 7898 7792



FTI Consulting LLP

Ed Berry /Ed Bridges

[email protected]

[email protected]

 

Tel:     +44 (0) 20 3727 1067

+44 (0) 20 3727 1046

 

Important Notice Relating to the Financial Adviser

Jefferies, which is authorised and regulated in the United Kingdom by the FCA, is acting as exclusive financial adviser to HarbourVest and HarbourVest Bidco and no one else in connection with the Offer and will not be responsible to anyone other than HarbourVest and HarbourVest Bidco for providing the protections afforded to clients of Jefferies or for providing advice in relation to the contents of this Announcement, in connection with the Offer or any other matter referred to herein or in the Offer Document.

Further Information

This Announcement is for information purposes only. It is not intended to and does not constitute, or form part of, an offer or invitation or the solicitation of any offer to sell or purchase any securities or the solicitation of any offer to otherwise acquire, subscribe for, sell or otherwise dispose of any securities, or the solicitation of any vote or approval of an offer to buy securities in any jurisdiction, pursuant to the Offer or otherwise. The Offer will be made solely by means of the Offer Document and, in respect of SVG Capital Shares held in certificated form, the Form of Acceptance, which will contain the full terms and conditions of the Offer, including details of how the Offer may be accepted. Any decision in respect of, or other response to, the Offer should be made only on the basis of the information contained in those documents. SVG Capital Shareholders are advised to read the formal documentation in relation to the Offer carefully once it has been despatched.

This Announcement does not constitute a prospectus or prospectus equivalent document.

Overseas Jurisdictions

The release, publication or distribution of this Announcement in, and the availability of the Offer to persons who are residents, citizens or nationals of, jurisdictions other than the United Kingdom may be restricted by laws and/or regulations of those jurisdictions. Therefore any such persons should inform themselves about and observe any applicable legal or regulatory requirements in their jurisdiction. Any failure to comply with the applicable requirements may constitute a violation of the laws and/or regulations of any such jurisdiction. Further details in relation to overseas shareholders will be contained in the Offer Document.

In particular, copies of this Announcement and any formal documentation relating to the Offer are not being, and must not be, directly or indirectly, mailed or otherwise forwarded, distributed or sent in or into or from any Restricted Jurisdiction and persons receiving such documents (including, without limitation, any agents, custodians, nominees and trustees) must not mail or otherwise forward, distribute or send them in or into or from any Restricted Jurisdiction. Unless otherwise determined by the Offeror or required by the City Code, and permitted by applicable law and regulation, the Offer is not being, and will not be, made, directly or indirectly, in or into or from, or by the use of mails or any means or instrumentality (including, but not limited to, facsimile, e-mail or other electronic transmission, telex or telephone) of interstate or foreign commerce of, or of any facility of a national, state or other securities exchange of, any Restricted Jurisdiction and the Offer may not be capable of acceptance by any such use, means, instrumentality or facilities.

The receipt of cash pursuant to the Offer by SVG Capital Shareholders may be a taxable transaction under applicable national, state or local, as well as foreign and other, tax laws. Each SVG Capital Shareholder is urged to consult its independent professional adviser regarding the tax consequences of accepting the Offer.

This Announcement has been prepared in compliance with English law, the rules of the London Stock Exchange and the City Code and the information disclosed may not be the same as that which would have been disclosed if this Announcement had been prepared in accordance with the laws of jurisdictions outside of England and Wales.

Notice to US Investors

The Offer is being made to holders of SVG Capital Shares resident in the United States in reliance on, and compliance with, Section 14(e) of the Exchange Act, and Regulation 14E thereunder. The Offer is being made in the United States by the Offeror and no one else.

The Offer is subject to disclosure requirements, which are different from certain United States disclosure requirements.

Furthermore, the payment and settlement procedure with respect to the Offer will comply with the relevant United Kingdom rules, which differ from US payment and settlement procedures, particularly with regard to the date of payment of consideration.

To the extent permissible under applicable securities laws, Jefferies and its affiliates may from time to time purchase, or enter into arrangements to purchase, SVG Capital Shares either as principal or agent before and during the period when the Offer remains open for acceptance. Pursuant to Rule 14e-5(b) of the Exchange Act, any affiliate of a financial adviser to the HarbourVest Group may from time to time make purchases of, or arrangements to purchase, SVG Capital Shares outside of the United States, other than pursuant to the Offer, before or during the period in which the Offer is open for submission of tenders, so long as the acquisitions or arrangements comply with the provisions of the exemption provided under Rule 14e-5.  Pursuant to Rule 14e-5 of the Exchange Act, HarbourVest Bidco, its affiliates, nominees or brokers (acting as agents), and a financial adviser and its affiliates, may from time to time make purchases of, or arrangements to purchase, the SVG Capital Shares, other than pursuant to the Offer, before or during the period in which the Offer is open for submission of tenders so long as those acquisitions or arrangements comply with the provisions of the exemption provided under Rule 14e-5 of the Exchange Act.  These purchases may occur either in the open market at prevailing prices or in private transactions at negotiated prices. Information about such purchases will be disclosed as and if required by applicable securities laws.

Forward Looking Statements

This Announcement contains statements about HarbourVest, the Wider HarbourVest Group and the SVG Capital Group that are or may be forward looking statements. All statements other than statements of historical facts included in this Announcement may be forward looking statements. Without limitation, any statements preceded or followed by or that include the words "targets", "plans" "believes", "expects", "aims"," intends", "will", "may", "anticipates", "estimates", "projects" or words or terms of similar substance or the negative thereof, are forward looking statements. Forward looking statements include statements relating to the following: (i) statements relating to the expected benefits of the acquisition to HarbourVest, the Wider HarbourVest Group and/or the SVG Capital Group; (ii) background to and reasons for the Offer; (iii) expectations of the impact of the acquisition on revenue and earnings of HarbourVest, the Wider HarbourVest Group and/or the SVG Capital Group; (iv) future capital expenditures, expenses, revenues, earnings, synergies, economic performance, indebtedness, financial condition, dividend policy, losses and future prospects; (v) business and management strategies and the expansion and growth of HarbourVest's, the Wider HarbourVest Group's and/or the SVG Capital Group's operations and potential synergies resulting from the Offer; and (vi) the effects of government regulation on HarbourVest's, the Wider HarbourVest Group's and/or the SVG Capital Group's business.

Such forward looking statements involve risks and uncertainties that could significantly affect expected results and are based on certain key assumptions. Many factors could cause actual results to differ materially from those projected or implied in any forward looking statements, including risks relating to the successful combination of SVG Capital with HarbourVest; higher than anticipated costs relating to the combination of SVG Capital with HarbourVest or investment required in SVG Capital to realise expected benefits and facts relating to SVG Capital that may impact the timing or amount of benefit realised from the acquisition that are unknown to HarbourVest. Due to such uncertainties and risks, readers are cautioned not to place undue reliance on such forward looking statements, which speak only as of the date hereof. Each of HarbourVest and HarbourVest Bidco disclaims any obligation to update any forward looking or other statements contained herein, except as required by applicable law.

No Profit Forecasts or Estimates

Nothing herein contained shall be deemed to be a profit forecast, projection or estimate for any period unless otherwise stated, and no statement in this Announcement should be interpreted to mean that earnings or earnings per SVG Capital Share for the current or future financial years will necessarily match or exceed the historical published earnings or earnings per SVG Capital Share.

Dealing Disclosure Requirements of the City Code

Under Rule 8.3(a) of the City Code, any person who is interested in 1% or more of any class of relevant securities of an offeree company or of any securities exchange offeror (being any offeror other than an offeror in respect of which it has been announced that its offer is, or is likely to be, solely in cash) must make an Opening Position Disclosure following the commencement of the offer period and, if later, following the announcement in which any securities exchange offeror is first identified. An Opening Position Disclosure must contain details of the person's interests and short positions in, and rights to subscribe for, any relevant securities of each of: (i) the offeree company; and (ii) any securities exchange offeror(s). An Opening Position Disclosure by a person to whom Rule 8.3(a) applies must be made by no later than 3.30 p.m. (London time) on the 10th Business Day following the commencement of the offer period and, if appropriate, by no later than 3.30 p.m. (London time) on the 10th Business Day following the announcement in which any securities exchange offeror is first identified. Relevant persons who deal in the relevant securities of the offeree company or of a securities exchange offeror prior to the deadline for making an Opening Position Disclosure must instead make a Dealing Disclosure.

Under Rule 8.3(b) of the City Code, any person who is, or becomes, interested in 1% or more of any class of relevant securities of the offeree company or of any securities exchange offeror must make a Dealing Disclosure if the person deals in any relevant securities of the offeree company or of any securities exchange offeror. A Dealing Disclosure must contain details of the dealing concerned and of the person's interests and short positions in, and rights to subscribe for, any relevant securities of each of: (i) the offeree company; and (ii) any securities exchange offeror(s), save to the extent that these details have previously been disclosed under Rule 8. A Dealing Disclosure by a person to whom Rule 8.3(b) applies must be made by no later than 3.30 p.m. (London time) on the Business Day following the date of the relevant dealing.

If two or more persons act together pursuant to an agreement or understanding, whether formal or informal, to acquire or control an interest in relevant securities of an offeree company or a paper offeror, they will be deemed to be a single person for the purpose of Rule 8.3.

Opening Position Disclosures must also be made by the offeree company and by any offeror and Dealing Disclosures must also be made by the offeree company, by any offeror and by any persons acting in concert with any of them (see Rules 8.1, 8.2 and 8.4 of the City Code).

Details of the offeree and offeror companies in respect of whose relevant securities Opening Position Disclosures and Dealing Disclosures must be made can be found in the Disclosure Table on the Takeover Panel's website at http://www.thetakeoverpanel.org.uk, including details of the number of relevant securities in issue, when the offer period commenced and when any offeror was first identified. If you are in any doubt as to whether you are required to make an Opening Position Disclosure or a Dealing Disclosure, you should contact the Panel's Market Surveillance Unit on +44 (0)20 7638 0129.

Publication on Website and Availability of Hard Copies

A copy of this Announcement and the documents required to be published pursuant to Rule 26.1 of the City Code will be made available, subject to certain restrictions relating to persons resident in any Restricted Jurisdiction, on HarbourVest's website at http://www.harbourvest.com/offer-2016 by no later than 12 noon (London time) on the Business Day following the date of this Announcement until the end of the Offer Period. For the avoidance of doubt, the contents of that website are not incorporated into, and do not form part of, this Announcement.

SVG Capital Shareholders may request a hard copy of this Announcement by contacting Edward Berry at FTI Consulting LLP during business hours on 0203 727 1046 or if calling from outside the UK on +44 203 727 1046. Calls are charged at the standard geographic rate and will vary by provider. Calls outside the United Kingdom will be charged at the applicable international rate. You may also request that all future documents, announcements and information to be sent to you in relation to the Offer should be in hard copy form.

Information Relating to SVG Capital Shareholders

Please be aware that addresses, electronic addresses and certain other information provided by SVG Capital Shareholders, persons with information rights and other relevant persons for the receipt of communication from the Company may be provided to the Offeror during the Offer Period as required under Section 4 of Appendix 4 of the City Code.

 

Rounding

Certain figures included in this Announcement have been subjected to rounding adjustments. Accordingly, figures shown for the same category presented in different tables may vary slightly and figures shown as totals in certain tables may not be an arithmetic aggregation of the figures that precede them.

 

 

APPENDIX I

 

CONDITIONS AND CERTAIN FURTHER TERMS OF THE OFFER

 

The Offer will be made on the terms and conditions set out in this Appendix and in the Offer Document and the Form of Acceptance.

A.               Conditions of the Offer

The Offer will be subject to the following Conditions:

1.                valid acceptances being received (and not, where permitted, withdrawn) by no later than 1.00 p.m. (London time) on the first closing date of the Offer (or such later time(s) and/or dates(s) as the Offeror may, with the consent of the Panel or in accordance with the City Code, decide) in respect of SVG Capital Shares which, together with all other SVG Capital Shares which the Offeror acquires or agrees to acquire (whether pursuant to the Offer or otherwise), carry more than 50% of the voting rights normally exercisable at general meetings of SVG Capital including for this purpose (to the extent, if any, required by the Panel) any such voting rights attaching to any SVG Capital Shares that are unconditionally allotted or issued before the Offer becomes or is declared unconditional as to acceptances whether pursuant to the exercise of any outstanding subscription or conversion rights or otherwise. In this Condition, SVG Capital Shares which have been unconditionally allotted but not issued before the Offer becomes or is declared unconditional as to acceptances, whether pursuant to the exercise of any outstanding subscription or conversion rights or otherwise, shall be deemed to carry the voting rights they will carry on being issued;

2.                the FCA approving either unconditionally (pursuant to section 189(4)(a) or section 189(6) of the Financial Services and Markets Act 2000, as amended ("FSMA")) or subject to one or more conditions (pursuant to section 189(7) of FSMA) that are satisfactory to HarbourVest acting reasonably, the change of control over any member of the Wider SVG Capital Group that is a person authorised by the FCA and each person who would become a controller as a result of the Offer or its implementation by HarbourVest Bidco. For the purposes of this paragraph only, "controller" shall have the meaning ascribed to it in section 422 of FSMA and "control" shall be construed in accordance with the provisions of Part XII of FSMA);

3.               

(a)              all authorisations in any jurisdiction which the Offeror reasonably considers necessary or appropriate for, or desirable in respect of, the Offer, its implementation or financing, or any acquisition or proposed acquisition of any shares or other securities in, or control or management of, SVG Capital or any other member of the Wider SVG Capital Group by any member of the Wider HarbourVest Group having been obtained in terms and in a form satisfactory to the Offeror from any relevant person or from any person or body with whom any member of the Wider SVG Capital Group has entered into contractual arrangements and all such authorisations remaining in full force and effect and there being no intimation of any intention to revoke, suspend, restrict, modify or not renew the same;

(b)              all authorisations which the Offeror reasonably considers necessary or appropriate, or desirable, in any relevant jurisdiction to carry on the business of any member of the Wider SVG Capital Group remaining in full force and effect and all filings necessary for such purpose having been made and there being no notice or intimation of any intention to revoke, suspend, restrict, modify or not to renew the same at the time at which the Offer otherwise becomes unconditional; and

(c)              all necessary statutory or regulatory obligations in any jurisdiction having been complied with, all filings or applications which the Offeror reasonably considers necessary or appropriate, or desirable having been made in connection with the Offer and all appropriate waiting and other time periods (including any extensions thereof) under applicable laws or regulations of any relevant jurisdiction having expired, lapsed or been terminated (as appropriate) and all regulatory clearances in any relevant jurisdiction having been obtained, in each case in respect of the Offer or any matter arising from the proposed acquisition of SVG Capital by any member of the Wider HarbourVest Group, and no temporary restraining order, preliminary or permanent injunction or other order having been threatened or issued and being in effect by a court or other relevant person of competent jurisdiction which has the effect of making the Offer illegal or otherwise prohibiting the consummation of the Offer or any matter arising from the proposed acquisition of SVG Capital by any member of the Wider HarbourVest Group;

4.                no relevant person having taken, instituted, implemented or threatened or having decided or intimated a decision to take, institute or implement any action, proceeding, suit, investigation, inquiry or reference (and in each case, not having withdrawn the same) or having required any action to be taken or otherwise having done anything or having enacted, made or proposed any statute, regulation, order or decision or taken any other measure or step and there not continuing to be outstanding any statute, regulation, order or decision that would or might be expected to:

(a)              make the Offer, its implementation or the acquisition or proposed acquisition of any shares in, or control or management of, the Wider SVG Capital Group by any member of the Wider HarbourVest Group illegal, void or unenforceable under the laws of any relevant jurisdiction; or

(b)              otherwise, directly or indirectly, prevent, prohibit or otherwise restrict, restrain, delay or interfere in the implementation of or impose additional conditions or obligations with respect to or otherwise challenge or require amendment of the Offer or the proposed acquisition of SVG Capital by the Offeror or any other member of the Wider HarbourVest Group or any acquisition of shares in SVG Capital by the Offeror or any other member of the Wider HarbourVest Group; or

(c)              require, prevent or delay the divestiture, or alter the terms envisaged for any proposed divestiture, by any member of the Wider HarbourVest Group of any shares or other securities in the Wider SVG Capital Group; or

(d)              impose any limitation on, or result in any delay in, the ability of any member of the Wider HarbourVest Group or any member of the Wider SVG Capital Group, directly or indirectly, to acquire or hold or exercise effectively, directly or indirectly, any rights of ownership of shares or other securities or the equivalent in any member of the Wider SVG Capital Group or to exercise voting or management control over any member of the Wider SVG Capital Group; or

(e)              require, prevent or delay the divestiture, or alter the terms envisaged for any proposed divestiture, by SVG Capital or any member of the Wider SVG Capital Group, or require, prevent or delay the divestiture, or alter the terms, of any proposed divestiture by any member of the Wider SVG Capital Group, of all or any part of their respective businesses, assets or properties or impose any limitation on the ability of any of them to conduct their respective businesses or to own, control or manage their respective businesses, assets or properties or parts thereof; or

(f)               require any member of the Wider HarbourVest Group or of the Wider SVG Capital Group to acquire or offer to acquire any shares or other securities (or the equivalent) in any member of the Wider SVG Capital Group or any member of the Wider HarbourVest Group owned by any third party (in each case, other than in implementation of the Offer); or

(g)              impose any limitation on the ability of any member of the Wider HarbourVest Group or the Wider SVG Capital Group to conduct, integrate or co‑ordinate its business, or any part of it, with the businesses or any part of the businesses of any other member of the Wider HarbourVest Group and/or the Wider SVG Capital Group; or

(h)              result in any member of the Wider HarbourVest Group or the Wider SVG Capital Group ceasing to be able to carry on business under any name under which it presently does so; or

(i)               otherwise adversely affect any or all of the businesses, assets, profits, financial or trading position or prospects of any member of the Wider HarbourVest Group or the Wider SVG Capital Group,

and all applicable waiting and other time periods (including any extensions of such waiting or time periods) during which any such relevant person could decide to take, institute, or implement or threaten, any such action, proceeding, suit, investigation, enquiry or reference or take any other step under the laws of any jurisdiction in respect of the Offer or the acquisition or proposed acquisition of any SVG Capital Shares, having expired, lapsed or been terminated;

5.                there being no provision of any arrangement, agreement, licence, permit or other instrument to which any member of the Wider SVG Capital Group is a party, or by or to which any such member, or any part of its assets, is or are or may be bound, entitled or subject, which would or might, in each case as a consequence of the Offer or the implementation of the same or of the acquisition or proposed acquisition of all or any part of the issued share capital of, or change of control or management of, SVG Capital or any other member of the Wider SVG Capital Group, be expected to result in:

(a)              any assets or interests of, or any asset the use of which is enjoyed by, any member of the Wider SVG Capital Group being or falling to be disposed of or charged in any way or ceasing to be available to any member of the Wider SVG Capital Group or any rights arising under which any such asset or interest could be required to be disposed of or charged in any way or could cease to be available to any member of the Wider SVG Capital Group; or

(b)              any moneys borrowed by or any other indebtedness or liabilities (actual or contingent) of, or any grant available to, any member of the Wider SVG Capital Group being or becoming repayable or capable of being declared repayable, immediately or prior to its or their stated repayment or maturity date or the ability of such member of the Wider SVG Capital Group to incur any such borrowing or indebtedness becoming or being capable of becoming withdrawn, inhibited or prohibited; or

(c)              any such arrangement, agreement, licence, permit or other instrument or the rights, liabilities, obligations or interests of any member of the Wider SVG Capital Group being, or becoming capable of being, terminated or modified or affected or any obligation or liability arising or any action being taken or arising under it; or

(d)              the interests or business of any member of the Wider SVG Capital Group in or with any third party (or any arrangements relating to any such interests or business) being terminated or modified or affected; or

(e)              the financial or trading position or prospects or value of any member of the Wider SVG Capital Group being prejudiced or affected; or

(f)               the creation or enforcement of any mortgage, charge or other security interest over the whole or any part of the business, property, assets or interests of any member of the Wider SVG Capital Group or any such security (whenever created, arising or having arisen) becoming enforceable or being enforced; or

(g)              any member of the Wider SVG Capital Group ceasing to be able to carry on business under any name under which or on the terms on which it currently does so or any person presently not able to carry on business under any name under which any member of the Wider SVG Capital Group currently does becoming able to do so; or

(h)              the creation or acceleration of any actual or contingent liabilities by any member of the Wider SVG Capital Group; or

(i)               the ability of any member of the Wider SVG Capital Group to carry on its business being prejudiced or affected,

and no event having occurred which, under any provision of any such arrangement, agreement, licence, permit or other instrument to which any member of the Wider SVG Capital Group is a party, or by or to which any such member, or any of its assets, may be bound, entitled or subject, could result in any of the events or circumstances as are referred to in sub-paragraphs 5(a) to (i) inclusive;

6.                since the Accounting Date and save as Publicly Announced, no member of the Wider SVG Capital Group having:

(a)              issued or agreed to issue or authorised or proposed or announced its intention to issue or grant additional shares of any class or securities or securities convertible into or exchangeable for, or rights, warrants or options to subscribe for or acquire, any such shares, securities or convertible securities or transferred or sold, or agreed to transfer or sell, or authorised or proposed the transfer or sale of SVG Capital Shares out of treasury (save as pursuant to the SVG Capital Share Schemes); or

(b)              redeemed, purchased, repaid or reduced or proposed the redemption, purchase, repayment or reduction of any part of its share capital or other securities or made or proposed the making of any other change to its share capital; or

(c)              recommended, declared, paid or made or proposed to recommend, declare, pay or make any dividend, bonus issue or other distribution whether payable in cash or otherwise; or

(d)              entered into, implemented or authorised the entry into, any joint venture, asset or profit sharing arrangement, partnership, merger or demerger of any body corporate, partnership or business or proposed or announced any intention to propose any such joint venture, asset or profit sharing arrangement, partnership, merger or demerger; or

(e)              other than in the ordinary course of business, acquired or disposed of, transferred, mortgaged or charged, or created or granted any security interest over, any assets (including shares and trade investments) or authorised or proposed or announced any intention to propose any acquisition, disposal, transfer, mortgage, charge or creation or grant of any security interest; or

(f)               issued or authorised or proposed or announced an intention to authorise or propose the issue of, or made any change in or to the terms of, any debentures or incurred or increased any borrowings, indebtedness or liability (actual or contingent); or

(g)              entered into or varied, or authorised or proposed the entry into or variation of, or announced its intention to enter into or vary, any transaction, arrangement, contract or commitment (whether in respect of capital expenditure or otherwise) which is of a long term, onerous or unusual nature or magnitude or could involve an obligation of such nature or magnitude or which is or could be restrictive to the existing business of any member of the Wider SVG Capital Group or the Wider HarbourVest Group or which is other than in the ordinary course of business; or

(h)              entered into, implemented, effected, authorised or proposed or announced its intention to enter into, implement, effect, authorise or propose any contract, reconstruction, amalgamation, scheme, commitment or other transaction or arrangement otherwise than in the ordinary course of business; or

(i)               waived, compromised or settled any claim; or

(j)               entered into or varied or made any offer (which remains open for acceptance) to enter into or vary the terms of any contract, service agreement, commitment or arrangement with any of the directors or senior executives of SVG Capital or any of the directors or senior executives of any other member of the Wider SVG Capital Group; or

(k)              taken or proposed any steps, corporate action or had any legal proceedings instituted or threatened against it or petition presented for its winding‑up (voluntary or otherwise), dissolution or reorganisation or for the appointment of a receiver, administrator, administrative receiver, trustee or similar officer of all or any of its assets and revenues or for any analogous proceedings or steps in any jurisdiction or for the appointment of any analogous person in any jurisdiction; or

(l)               been unable, or admitted in writing that it is unable, to pay its debts or has stopped or suspended (or threatened to stop or suspend) payment of its debts generally or ceased or threatened to cease carrying on all or a substantial part of its business; or

(m)             proposed, agreed to provide or modified the terms of any share option scheme, incentive scheme or other benefit relating to the employment or termination of employment of any person employed by the Wider SVG Capital Group; or

(n)              made any alteration to its articles of association, or other incorporation documents; or

(o)              made, authorised or announced an intention to propose any change in its loan capital; or

(p)              in relation to the pension schemes established for its directors and/or other employees and/or their dependants, made or consented to any change to:

(i)                  the terms of the trust deeds and rules constituting such pension schemes or to the benefits which accrue;

(ii)                 the pensions which are payable, under them;

(iii)                the contributions payable to any such scheme(s);

(iv)                the basis on which qualifications for or accrual of or entitlement to such benefits or pensions are calculated or determined;

(v)                 the basis upon which the liabilities (including pensions) of such pension schemes are funded, valued or made;

(vi)                or agreed or consented to any change to the trustees of such pension schemes; or

 

(q)              terminated or varied the terms of any agreement or arrangement between any member of the Wider SVG Capital Group and any other person in a manner which would have an adverse effect on the financial position of the Wider SVG Capital Group; or

(r)               entered into any agreement, arrangement, commitment or contract or passed any resolution or made any offer (which remains open for acceptance) or proposed or announced any intention with respect to effecting any of the transactions, matters or events referred to in this Condition 6; or

(s)              taken or agreed to take any action that requires, or would require, the consent of the Panel or the approval of SVG Capital Shareholders in general meeting in accordance with, or as contemplated by, Rule 21.1 of the City Code;

7.                in the period since the Accounting Date and save as Publicly Announced:

(a)              no litigation or arbitration proceedings, prosecution, investigation or other legal proceedings having been announced, instituted, threatened or remaining outstanding by, against or in respect of, any member of the Wider SVG Capital Group or to which any member of the Wider SVG Capital Group is or may become a party (whether as claimant, defendant or otherwise);

(b)              no adverse change or deterioration having occurred, and no circumstances having arisen which would or might be expected to result in any adverse change or deterioration, in the business, assets, financial or trading position or prospects or profits or operational performance of any member of the Wider SVG Capital Group;

(c)              no enquiry or investigation by, or complaint or reference to, any relevant person against or in respect of any member of the Wider SVG Capital Group having been threatened, announced, implemented or instituted or remaining outstanding by, against or in respect of, any member of the Wider SVG Capital Group;

(d)              no contingent or other liability having arisen or become apparent or increased; and

(e)              no step having been taken and no omission having been made which is likely to result in the withdrawal, cancellation, termination or modification of any licence held by any member of the Wider SVG Capital Group;

8.                the Offeror and/or any other member of the Wider HarbourVest Group not having discovered that:

(a)              any member of the Wider SVG Capital Group, or any partnership, company or other entity in which any member of the Wider SVG Capital Group has a significant economic interest and which is not a subsidiary undertaking of SVG Capital, is subject to any liability (actual or contingent) which is not Publicly Announced; or

(b)              the financial, business or other information disclosed at any time by any member of the Wider SVG Capital Group, whether publicly or in the context of the Offer either contained a misrepresentation of fact, was misleading or omitted to state a fact necessary to make the information disclosed not misleading; or

(c)              any contingent liability disclosed in such disclosed information would or might adversely affect, directly or indirectly, the business, profits or prospects of the Wider SVG Capital Group; or

(d)              any information which affects the import of any information disclosed at any time by or on behalf of any member of the Wider SVG Capital Group to an extent which is material in the context of the Wider SVG Capital Group; or

(e)              any member of the Wider SVG Capital Group is subject to any liability, contingent or otherwise; or

(f)               any member of the Wider SVG Capital Group does not own or have licensed to it or otherwise possess legally enforceable rights to use all intellectual property that is:

(i)                  required or reasonably necessary for the conduct of business of the relevant member of the Wider SVG Capital Group as currently conducted; or

(ii)                 under development for such business; or

(g)              any member of the Wider SVG Capital Group has infringed, any intellectual property rights of any third party where the consequences of which would be material in the context of the Wider SVG Capital Group; or

(h)              any claims have been asserted in writing or threatened in writing by any person:

(i)                  that the Wider SVG Capital Group infringes any intellectual property of any third party; or

(ii)                 challenging the ownership of any member of the Wider SVG Capital Group to, or the validity or effectiveness of, any of its intellectual property; or

 

(i)               any intellectual property held by any member of the Wider SVG Capital Group is not valid and subsisting; or

(j)               there is unauthorised use, infringement or misappropriation of any intellectual property of any member of the Wider SVG Capital Group by any third party; or

(k)              any persons who are now, or within the last five years have been, employees, consultants or contractors of any member of the Wider SVG Capital Group have failed to execute proprietary information and confidentiality agreements; and

9.                the Offeror and/or any other member of the Wider HarbourVest Group not having discovered that:

(a)              any past or present member of the Wider SVG Capital Group or any person that performs or has performed services for or on behalf of any such member is or has engaged in any activity, practice or conduct (or omitted to take any action) which would constitute an offence under the UK Bribery Act 2010, the US Foreign Corrupt Practices Act of 1977 or any other applicable anti-corruption legislation; or

(b)              any past or present member of the Wider SVG Capital Group has engaged in any activity or business with, or made any investments in, or made any payments to any government, entity or individual covered by any of the economic sanctions administered by the United Nations or the European Union (or any of their respective member states) or the United States Office of Foreign Assets Control or any other governments or supranational body or authority in any jurisdiction; or

(c)              any asset of any member of the Wider SVG Capital Group constitutes criminal property as defined by section 340(3) of the Proceeds of Crime Act 2002 (but disregarding paragraph (b) of that definition).

B.            Certain Further Terms of the Offer

1.                The Conditions are inserted for the benefit of the Offeror and no SVG Capital Shareholder shall be entitled to waive any of the Conditions without the prior consent of the Offeror.

2.                Subject to the requirements of the City Code and the Panel, the Offeror reserves the right to waive all or any of Conditions 2 to 9 (inclusive) in Part A in whole or in part, at its absolute discretion.

3.                Each of Conditions 1 to 9 in Part A shall be regarded as a separate Condition and shall not be limited by reference to any other Condition.

4.                The Offer will lapse, and will not proceed, if the proposed acquisition of SVG Capital is referred to a Phase 2 investigation by the UK Competition and Markets Authority ("CMA"), or if the European Commission either initiates Phase 2 proceedings or there is a Phase 2 CMA reference following a referral by the European Commission under Article 9(1) EUMR to a competent authority in the United Kingdom before 1.00 p.m. (London time) on the first closing date or the time and date on which the Offer becomes or is declared unconditional as to acceptances (whichever is the later).

5.                If the Offer lapses, it will cease to be capable of further acceptance and persons accepting the Offer and the Offeror shall thereupon cease to be bound by acceptances submitted at or before the time the Offer lapses.

6.                The Offer will lapse, and will not proceed, unless all of the Conditions relating to the Offer have been fulfilled or (if capable of waiver) waived by, or, where appropriate, have been determined by HarbourVest Bidco to be and remain satisfied by, midnight on the twenty-first day after the later of:

(a)              the first closing date of the Offer; or

(b)              the date on which the Offer becomes unconditional as to acceptances,

or such later date as the Offeror may, with the consent of the Panel, decide. The Offeror shall be under no obligation to waive or treat as satisfied any Condition by a date earlier than the latest date specified above for its satisfaction even though the other Conditions of the Offer may, at such earlier date, have been waived or fulfilled and there are, at such earlier date, no circumstances indicating that any such Conditions may not be capable of fulfilment.

7.                Except with the Panel's consent and in accordance with Rule 13.5 of the City Code, the Offeror will not invoke any of Conditions 2 to 9 (inclusive) in Part A so as to cause the Offer not to proceed, to lapse or to be withdrawn unless the circumstances which give rise to the right to invoke the relevant Condition are of material significance to the Offeror in the context of the Offer.

8.                If the Offeror is required by the Panel to make an offer for SVG Capital Shares under Rule 9 of the City Code, the Offeror may make such alterations to the Conditions of the Offer set out above, including Condition 1, as are necessary to comply with that Rule.

9.                The Offeror reserves the right for any member of the Wider HarbourVest Group from time to time, instead of the Offeror, to make the Offer or otherwise implement the acquisition of SVG Capital. 

10.              SVG Capital Shares will be acquired by the Offeror fully paid and free from all liens, equities, charges, equitable interests, encumbrances, rights of pre‑emption and any other third party right and/or interests of any nature whatsoever and together with all rights attaching to them as at the date of this Announcement or subsequently attaching or accruing to them, including, without limitation, the right to receive and retain, in full, all dividends, interest and other distributions (if any) declared, paid or made, or any other return of capital (whether by way of reduction of share capital or share premium account or otherwise) made on or after the date of this Announcement. Accordingly, insofar as a dividend and/or a distribution and/or a return of capital is proposed, declared, made, paid or payable by SVG Capital in respect of a SVG Capital Share after the date of this Announcement, HarbourVest Bidco reserves the right to reduce the price payable under the Offer in respect of a SVG Capital Share by the amount of the dividend and/or distribution and/or return of capital except insofar as the SVG Capital Share is or will be transferred pursuant to the Offer on a basis which entitles the Offeror alone to receive the dividend and/or distribution and/or return of capital but if that reduction in price has not been effected, the person to whom the final Offer price is paid in respect of that SVG Capital Share will be obliged to account to the Offeror for the amount of such dividend or distribution or return of capital.

11.              The Offer will be made on the terms and will be subject to the Conditions which are set out in this Appendix I, those terms which will be set out in the Offer Document and such further terms as may be required to comply with the applicable rules and regulations of the FCA and the London Stock Exchange and the City Code, as well as the applicable requirements of US federal securities laws. This Announcement does not constitute, or form part of, an offer or invitation to purchase SVG Capital Shares or any other securities.

12.              The Offer will not be made, directly or indirectly, in, into or by use of the mails of, or by any means or instrumentality (including, without limitation, telephonically, or electronically) of interstate or foreign commerce of, or any facilities of a national securities exchange of, any Restricted Jurisdiction. This document does not constitute an offer in any Restricted Jurisdiction and the Offer should not be accepted by any such use, means, instrumentality or facilities or otherwise from or within any Restricted Jurisdiction. Accordingly, copies of this document are not being and must not be mailed, transmitted or otherwise distributed in whole or in part, in, into or from any Restricted Jurisdiction and persons receiving this Announcement (including, without limitation, custodians, nominees and trustees) must not mail or otherwise forward, distribute or send it in, into or from any Restricted Jurisdiction. Doing so may render invalid any purported acceptance of the Offer.

13.              The Offeror reserves the right, in the event that the SVG Capital Directors recommend the Offer and with the consent of the Panel, to elect to implement the acquisition of the SVG Capital Shares by way of a scheme of arrangement under Part 26 of the Companies Act 2006 (a "Scheme"). In such event, the Scheme will be implemented on the same terms (subject to appropriate amendments), so far as applicable, as those which could apply to the Offer.

14.              This Offer and any acceptance thereof will be governed by English law and be subject to the jurisdiction of the English courts and to the Conditions set out herein and in the Offer Document and Form of Acceptance.

 

 

 

APPENDIX II

 

SOURCES OF INFORMATION AND BASES OF CALCULATION

 

In this Announcement, unless otherwise stated or the context otherwise requires, the following bases and sources have been used:

1.                The financial information relating to SVG Capital has been extracted or derived (without any adjustment) from SVG Capital's audited annual report and accounts for the year ended 31 January 2016 and from its interim management statement for the three-month period to 30 April 2016.

2.                Other information relating to SVG Capital has been extracted or derived, without material adjustment, from public sources.

3.                The value placed by the Offer on the entire existing issued share capital, and other statements made by reference to the existing issued and to be issued share capital, of SVG Capital are based on, as applicable, the final Offer price of 650 pence per SVG Capital Share and 156,109,970 SVG Capital Shares being in issue (as sourced from the Regulatory Information Service announcement released by SVG Capital on 31 August 2016).

4.                All prices quoted for SVG Capital Shares have been derived from Factset and represent the closing middle market prices of SVG Capital Shares on the relevant dates.

5.                References to a percentage of SVG Capital Shares are based on the number of SVG Capital Shares in issue (as sourced from the Regulatory Information Service announcement released by SVG Capital on 31 August 2016).

6.                The market capitalisation of SVG Capital has been based on 156,109,970 SVG Capital Shares being in issue (as sourced from the Regulatory Information Service announcement released by SVG Capital on 31 August 2016).

7.                References to SVG Capital's London-listed private equity funds peer group relate to the following companies: ICG Enterprise Trust, HarbourVest Global Private Equity, HgCapital Trust, NB Private Equity Partners, Electra Private Equity, Standard Life European Private Equity, F&C Private Equity Trust, Apax Global Alpha and Pantheon International.

8.                NAV discounts for SVG Capital have been based on the Closing Price per SVG Capital Share as at the applicable date and SVG Capital's currently-published NAV as at that same date.

9.                NAV discounts for SVG Capital's London-listed private equity funds peer group have been based on the closing middle market price per share of the relevant peer group member as at the applicable date and the relevant peer group member's NAV as at such date as sourced from Morningstar.

10.              Foreign exchange rates as at any applicable date are taken from Factset.

 

 

 

APPENDIX III

 

IRREVOCABLE UNDERTAKING AND LETTERS OF INTENT

 

Coller International Partners V-A, L.P. has given an irrevocable undertaking to accept or procure the acceptance of the Offer (or, in the event that the transaction is implemented by way of a Scheme at a Court Meeting, to enter into an equivalent undertaking in analogous terms to those contained in the irrevocable undertaking in respect of the Scheme) in relation to SVG Capital Shares representing approximately 20.0% of the share capital of SVG Capital in issue on 9 September 2016 (being the last Business Day prior to the commencement of the Offer Period). This irrevocable undertaking remains binding in the event of a competing offer for SVG Capital.

The above irrevocable undertaking also contains undertakings, among other things, except by acceptance of the Offer, not to sell, transfer, charge, pledge or otherwise encumber or grant any option or other right over, or otherwise dispose of or deal with or permit any such action in respect of all or any of the SVG Capital Shares or any interest in them nor to accept or give any undertaking or other commitment to accept (or to vote in favour of) any offer, scheme of arrangement, merger or business combination made or proposed in respect of all or any of the SVG Capital Shares, nor enter into any agreement or arrangement, incur any obligation or give any indication of intent, or permit any agreement or arrangement to be entered into, any obligation to arise or any indication of intent to be given (in any case whether conditionally or unconditionally and whether or not legally binding) with any person to do any such acts which would or might restrict or impede the Offer becoming unconditional or Coller International Partners V-A, L.P's ability to comply with its undertaking.

In addition, the irrevocable undertaking contains a further undertaking to exercise or procure the exercise of all voting rights attaching to the SVG Capital Shares in accordance with HarbourVest Bidco's written instructions in respect of any resolution (whether amended or not amended) proposed at a general meeting of SVG Capital (or at an adjourned meeting) or otherwise put to the Shareholders of SVG Capital (or a class thereof) the passing of which is necessary to implement the Offer or which, if passed, might result in any condition of the Offer not being fulfilled or which might impede or frustrate the Offer in any way.

The obligations in the irrevocable undertaking will lapse and cease to have effect if the Offer Document is not published within 28 days of the date of this Announcement, or if the Offer lapses or is withdrawn.

In addition, the following persons have given a letter of intent to accept or procure acceptance of the Offer in relation to the following SVG Capital Shares (in relation to Coller International Partners V-A, L.P., the intention is stated in the irrevocable undertaking):

Name

Number of SVG Capital Shares held

Percentage of share capital of SVG Capital in issue on September 2016

7,115,791

4.6%

Legal & General Investment Management

4,361,854

2.8%

Old Mutual

13,678,679

8.8%

Coller International Partners V-A, L.P.

10,263,458

6.6%

 

 

 

APPENDIX IV

 

DEFINITIONS

 

The following definitions shall apply throughout this Announcement, unless otherwise stated or the context otherwise requires.

"Accounting Date"

31 January 2016

"agreements"

arrangements, agreements, commitments, licences, permits, franchises, partnerships, joint ventures, authorisations or other instrument

"Announcement"

this announcement

"authorisations"

authorisations, orders, recognitions, grants, consents, licences, confirmations, clearances, permissions and approvals

"Business Day"

any day (other than a Saturday, Sunday or public holiday) on which clearing banks in London are open for normal business

"City Code"

the City Code on Takeovers and Mergers as from time to time interpreted by the Panel

"Closing Price"

the closing middle market price of a SVG Capital Share, as derived from Factset

"Companies Act 2006"

the Companies Act 2006, as amended

"Conditions"

the conditions to the Offer set out in Appendix I

"Dover Street IX Fund"

HarbourVest Dover Street IX Investment L.P.

"EUMR"

Council Regulation (EC) No 139/2004 of 20 January 2004 on the control of concentrations between undertakings

"Exchange Act"

the United States Securities Exchange Act of 1934, as amended

"FCA"

the UK Financial Conduct Authority

"Form of Acceptance"

the form of acceptance and authority relating to the Offer which will accompany the Offer Document for use by SVG Capital Shareholders

"HarbourVest"

HarbourVest Partners, LLC

"HarbourVest Bidco" or "Offeror"

HarbourVest Structured Solutions III L.P.

"HarbourVest Bidco GP"

HarbourVest GP LLC

"HarbourVest Group"

HarbourVest, its subsidiaries and subsidiary undertakings from time to time

"intellectual property"

all patents, trademarks, trade names, service marks, copyrights, designs, databases and any applications therefore, schematics, technology, know‑how, computer software, programs or applications (in both source code and object code form), and tangible or intangible proprietary information or material

"Jefferies"

Jefferies International Limited

"legal proceedings"

actions, suits, proceedings, investigations, references or enquiries

"Listing Rules"

the listing rules made by the FCA under Part VI of the Financial Services and Markets Act 2000

"London Stock Exchange"

London Stock Exchange plc

"NAV"

net asset value

"Offer"

the cash offer being made by HarbourVest Bidco to acquire the entire issued and to be issued share capital of SVG Capital (other than any SVG Capital Shares held by HarbourVest Bidco or any other member of the Wider HarbourVest Group) on the terms and subject to the conditions to be set out in the Offer Document and the Form of Acceptance and, where the context so requires, any subsequent revision, variation, extension or renewal thereof

"Offer Document"

the document to be sent to SVG Capital Shareholders which will contain the terms and conditions of the Offer and certain information about SVG Capital, HarbourVest, HarbourVest Bidco and the Wider HarbourVest Group

"Offer Documents"

the Offer Document and the Form of Acceptance

"Offer Period"

the period beginning on and including the date of this Announcement and ending on the latest of (i) the time and date on which the Offer becomes or is declared unconditional as to acceptances; and (ii) the time and date on which the Offer lapses or is withdrawn (or such other date as the Panel may decide)

"Official List"

the Official List of the FCA acting in its capacity as the UK Listing Authority

"Panel"

the UK Panel on Takeovers and Mergers

"Publicly Announced"

specifically disclosed in the annual report and accounts of SVG Capital for the year ended on the Accounting Date or in any announcement made to a Regulatory Information Service since the date of publication of such report and accounts and prior to the date of this Announcement

"Regulatory Information Service"

as defined in the Listing Rules

"relevant asset"

land, property or other asset now or previously owned, occupied or made use of by any past or present member of the Wider SVG Capital Group

"relevant persons"

governments, governmental, quasi‑governmental, supra-national, statutory, investigative, regulatory or administrative bodies or trade agencies, associations, institutions or courts, or professional or environmental bodies, or any other persons or bodies whatsoever in any jurisdiction

"Restricted Jurisdiction"

any jurisdiction where local laws or regulations may result in significant risk of civil, regulatory or criminal exposure if information concerning the Offer is sent or made available to SVG Capital Shareholders in that jurisdiction (in accordance with Rule 30.2 of the City Code)

"substantial interest"

a direct or indirect interest in 20% or more of the equity capital of an undertaking

"SVG Capital" or "Company"

SVG Capital plc

"SVG Capital Board" or "SVG Capital Directors"

the Board of Directors of SVG Capital

"SVG Capital Group"

SVG Capital, its subsidiaries and subsidiary undertakings from time to time

"SVG Capital Share Schemes"

the SVG Capital Group Performance shares plan, SVG Capital Group Deferred share plan and the SVG Capital Group Share Option Plan and any other arrangements for involving the employees of SVG Capital and for members of the SVG Capital Group in the share capital of SVG Capital

"SVG Capital Shareholders" or "Shareholders"

holders of SVG Capital Shares

"SVG Capital Shares" or "Shares"

the existing unconditionally allotted or issued and fully paid (or credited as fully paid) ordinary shares of 100 pence each in the capital of SVG Capital and any further such shares which may be unconditionally allotted or issued fully paid, or credited as fully paid, on or before the date on which the Offer closes (or such earlier date as HarbourVest may, subject to the City Code, decide, not being earlier than (a) the date on which the Offer becomes or is declared unconditional as to acceptances or (b), if later, the first closing date of the Offer), but excluding any shares held as treasury shares or which become treasury shares

"third party"

person, firm, company or body

"treasury shares"

treasury shares (as defined in section 974(6) of the Companies Act 2006) of SVG Capital

"United Kingdom" or "UK"

the United Kingdom of Great Britain and Northern Ireland

"United States" or "US"

the United States of America, its territories and possessions, any state of the United States and the District of Columbia and all other areas subject to its jurisdiction

"Wider HarbourVest Group"

HarbourVest and its subsidiaries, subsidiary undertakings, associated undertakings and any other undertakings in which HarbourVest and/or such subsidiaries or undertakings (aggregating their interests) have a substantial interest

"Wider SVG Capital Group"

SVG Capital and its subsidiaries, subsidiary undertakings, associated undertakings and any other undertakings in which SVG Capital and/or such subsidiaries or undertakings (aggregating their interests) have a substantial interest

 

 

 

In this Announcement:

·                  words importing the singular shall include the plural and vice versa and words importing the masculine gender shall include the feminine or neutral gender;

·                  all amounts contained within this document referred to by "Stg", "£", "pence" and "p" refer to pounds sterling and pence sterling;

·                  all amounts contained within this document referred to by "$", "US$" or "dollars" refer to US dollars;

·                  the expressions "subsidiary", "associated undertaking", "subsidiary undertaking" and "undertaking" have the meanings given by the Companies Act 2006;

·                  any reference to any provision of any legislation shall include any amendment, modification, re-enactment or extension thereof. Any reference to any legislation is to English legislation unless otherwise specified; and

·                  references to time are to London time, unless otherwise stated.


This information is provided by RNS
The company news service from the London Stock Exchange
 
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