Cityfibre Regulatory News (CITY)

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

For Immediate Release

4 May 2018

UPDATE ON RECOMMENDED CASH ACQUISITION

of

CITYFIBRE INFRASTRUCTURE HOLDINGS PLC ("CITYFIBRE")

by

CONNECT INFRASTRUCTURE BIDCO LIMITED ("BIDCO")

IRREVOCABLE UNDERTAKINGS

Introduction

On 24 April 2018, the boards of CityFibre and Bidco announced the terms of a recommended cash acquisition of CityFibre by Bidco (the "Rule 2.7 Announcement").

As set out in the Rule 2.7 Announcement, Bidco received irrevocable undertakings and a letter of intent to vote in favour of the Acquisition with respect to a total of 429,077,621 CityFibre Shares (representing approximately 67.82 per cent. of the existing issued ordinary share capital of CityFibre on 23 April 2018).

On 3 May 2018, Bidco announced that, following the sale of shares by Woodford Investment Management Limited (acting in its capacity as discretionary investment manager on behalf of certain of its clients) to Sand Grove Capital Management LLP ("Sand Grove") and Arrowgrass Master Fund Ltd, ("Arrowgrass") and the execution of irrevocable undertakings by Sand Grove and Arrowgrass, Bidco had irrevocable undertakings and a letter of intent to vote in favour of the Acquisition with respect to a total of 434,077,621 CityFibre Shares (representing approximately 68.61 per cent. of the existing issued ordinary share capital of CityFibre on 2 May 2018).

Further share sales

On 3 May 2018, Woodford Investment Management Limited (acting in its capacity as discretionary investment manager on behalf of certain of its clients) agreed to sell 18,937,611 CityFibre Shares to Melqart Opportunities Master Fund Ltd. ("Melqart") (the "Melqart Share Sale").

Conditional upon the completion of the Melqart Share Sale, Melqart has entered into an irrevocable commitment to vote, or procure the voting, to approve the Scheme at the Scheme Court Meeting and vote, or procure the voting, in favour of the Resolution to be proposed at the General Meeting or, if (with the consent of the Panel) Bidco exercises its right to implement the Acquisition by way of a Takeover Offer, to accept, or procure the acceptance of such Takeover Offer in respect of a total of the 18,937,611 CityFibre Shares.

In addition, on 3 May 2018, Woodford Investment Management Limited (acting in its capacity as discretionary investment manager on behalf of certain of its clients) agreed to sell 10,000,000 CityFibre Shares to MVN Asset Management ("MVN") (the "MVN Share Sale").

Conditional upon the completion of the MVN Share Sale, MVN has entered into an irrevocable commitment to vote, or procure the voting, to approve the Scheme at the Scheme Court Meeting and vote, or procure the voting, in favour of the Resolution to be proposed at the General Meeting or, if (with the consent of the Panel) Bidco exercises its right to implement the Acquisition by way of a Takeover Offer, to accept, or procure the acceptance of such Takeover Offer in respect of a total of the 10,000,000 CityFibre Shares.

Summary

As at the date of this announcement, Bidco has irrevocable undertakings and a letter of intent to vote in favour of the Acquisition with respect to a total of 434,125,621 CityFibre Shares (representing approximately 68.62 per cent. of the existing issued ordinary share capital of CityFibre on 3 May 2018).

Full details of the irrevocable undertakings and the letter of intent are set out in Appendix 1 to this announcement.

Terms not otherwise defined in this announcement shall have the meaning given to them in the Rule 2.7 Announcement.

Enquiries

Further information

Greenhill & Co. International LLP ("Greenhill") is authorised and regulated by the FCA in the United Kingdom. Greenhill is acting exclusively as financial adviser for the Consortium and Bidco and for no one else in connection with the matters referred to in this announcement and will not be responsible to anyone other than the Consortium and Bidco for providing the protections afforded to clients of Greenhill, or for providing advice in relation to the matters referred to in this announcement. Neither Greenhill nor any of its subsidiaries, branches or affiliates owes or accepts any duty, liability or responsibility whatsoever (whether direct or indirect, whether in contract, in tort, under statute or otherwise) to any person who is not a client of Greenhill in connection with the matters referred to in this announcement.

Goldman Sachs International, which is authorised by the Prudential Regulation Authority and regulated by the FCA and the Prudential Regulation Authority in the United Kingdom, is acting exclusively for the Consortium and Bidco and no one else in connection with the matters referred to in this announcement and will not be responsible to anyone other than the Consortium and Bidco for providing the protections afforded to clients of Goldman Sachs International, or for providing advice in relation to the matters referred to in this announcement. Neither Goldman Sachs International nor any of its subsidiaries, branches or affiliates owes or accepts any duty, liability or responsibility whatsoever (whether direct or indirect, whether in contract, in tort, under statute or otherwise) to any person who is not a client of Goldman Sachs International in connection with the matters referred to in this announcement.

This announcement is for information purposes only and is not intended to and does not constitute, or form part of, an offer to sell or subscribe for or an invitation to purchase or subscribe for any securities or the solicitation of any vote or approval in any jurisdiction pursuant to the Acquisition or otherwise, nor shall there be any purchase, sale or exchange of securities or such solicitation in any jurisdiction in which such offer, solicitation or sale or exchange would be unlawful prior to the registration or qualification under the laws of such jurisdiction. The Acquisition will be made solely through the Scheme Document and the accompanying Forms of Proxy, which will contain the full terms and conditions of the Acquisition, including details of how to vote in respect of the Acquisition. Any approval, decision or other response to the Acquisition should be made only on the basis of the information in the Scheme Document. CityFibre Shareholders are advised to read the Scheme Document and the accompanying Forms of Proxy once they have been despatched.

Overseas jurisdictions

The release, publication or distribution of this announcement in certain jurisdictions may be restricted by law and may affect the availability of the Acquisition to persons who are not resident in the United Kingdom. Persons who are not resident in the United Kingdom, or who are subject to laws of any jurisdiction other than the United Kingdom, should inform themselves about, and observe any applicable requirements. Any person (including, without limitation, nominees, trustees and custodians) who would, or otherwise intends to, forward this announcement, the Scheme Document or any accompanying document to any jurisdiction outside the United Kingdom should refrain from doing so and seek appropriate professional advice before taking any action. In particular, the ability of persons who are not resident in the United Kingdom to vote their CityFibre Shares at the Scheme Court Meeting or the General Meeting, or to execute and deliver Forms of Proxy appointing another to vote their CityFibre Shares in respect of the Scheme Court Meeting or the General Meeting on their behalf, may be affected by the laws of the relevant jurisdiction in which they are located. This announcement has been prepared for the purpose of complying with the laws of England and Wales, the AIM Rules and the 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.

Any failure to comply with the applicable legal or regulatory requirements may constitute a violation of the laws and/or regulations of any such jurisdiction. To the fullest extent permitted by applicable law, the companies and persons involved in the Acquisition disclaim any responsibility and liability for the violation of such restrictions by any person.

The Acquisition will not be made, directly or indirectly, in or into or by use of the mails or any other means or instrumentality (including, without limitation, telephonic or electronic) of interstate or foreign commerce of, or any facility of a national, state or other securities exchange of, a Restricted Jurisdiction, and the Acquisition will not be capable of acceptance by any such use, means, instrumentality or facility or from within a Restricted Jurisdiction. Accordingly, copies of this announcement and formal documentation relating to the Acquisition are not being, and must not be, directly or indirectly, mailed or otherwise forwarded or distributed in, into or from a Restricted Jurisdiction and persons receiving this announcement (including custodians, nominees and trustees) must not distribute or send it into or from a Restricted Jurisdiction. In the event that the Acquisition is implemented by way of a Takeover Offer and extended into the US, Bidco will do so in satisfaction of the procedural and filing requirements of the US securities laws at that time, to the extent applicable thereto. The Acquisition relates to the shares of an English company and it is proposed to be made by means of a scheme of arrangement provided for under the laws of England and Wales. The Scheme will relate to the shares of an English company that is a "foreign private issuer" as defined under Rule 3b-4 under the US Securities Exchange Act of 1934, as amended (the "US Exchange Act"). A transaction effected by means of a scheme of arrangement is not subject to the shareholder vote, proxy solicitation and tender offer rules under the US Exchange Act. Accordingly, the Scheme is subject to the disclosure requirements, rules and practices applicable in the UK to schemes of arrangement, which differ from the disclosure requirements and practices of US shareholder vote, proxy solicitation and tender offer rules.

Financial statements, and all financial information included in the relevant documentation, will have been prepared in accordance with accounting standards applicable in the UK and may not be comparable to the financial statements of US companies or other companies whose financial statements are prepared in accordance with US generally accepted accounting principles. However, if Bidco were to elect to implement the Acquisition by means of a Takeover Offer and extend such Takeover Offer into the US, such Takeover Offer shall be made in compliance with applicable UK and US securities laws and regulations, including the US tender offer rules. Such Takeover Offer would be made in the US by Bidco and no one else. In addition to any such Takeover Offer, Bidco, certain affiliated companies and the nominees or brokers (acting as agents) may make certain purchases of, or arrangements to purchase, shares in CityFibre outside such Takeover Offer during the period in which such Takeover Offer would remain open for acceptance. If such purchases or arrangements to purchase are made they would be made outside the United States in compliance with applicable law, including the US Exchange Act.

Further details in relation to Overseas Shareholders will be contained in the Scheme Document.

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 Code will be made available (subject to certain restrictions relating to persons resident in Restricted Jurisdictions), free of charge, at www.cliftoninvestment.com and www.CityFibre.com by no later than 12:00 noon (London time) on the Business Day following the date of publication of this announcement. The content of the websites referred to in this announcement is not incorporated into and does not form part of this announcement.

In accordance with Rule 30.3 of the Code, a person so entitled may request a hard copy of this announcement, free of charge, by contacting CityFibre's Company Secretary between 9:00 am and 5:00 pm (London time) Monday to Friday (except UK public holidays) on 0203 5100 602 from within the United Kingdom or on +44 203 5100 602 if calling from outside the United Kingdom. In accordance with Rule 30.3 of the Code, a person so entitled may also request that all future documents, announcements and information to be sent to them in relation to the Acquisition should be in hard copy form.

Appendix 1

Details of Irrevocable Undertakings and the Letter of Intent

Bidco and CityFibre have received irrevocable undertakings and a letter of intent to accept the Acquisition in respect of total of 434,125,621 CityFibre Shares (representing, in aggregate, approximately 68.62 per cent. of CityFibre Shares in issue on 3 May 2018 (being the last Business Day before the date of this announcement)).

CityFibre Directors' irrevocable undertakings

Bidco has received irrevocable undertakings from the CityFibre Directors in respect of their own beneficial holdings of CityFibre Shares, representing approximately 0.6 per cent. of the existing issued share capital of CityFibre:

(a) to cast (or procure the casting of) all voting rights attaching to such CityFibre Shares in favour of the Scheme at the Scheme Court Meeting and in favour of the Resolution at the General Meeting; and

(b) if the Acquisition is structured as a Takeover Offer, to accept or procure the acceptance of such Takeover Offer in respect of all such CityFibre Shares.

The irrevocable undertakings from the CityFibre Directors will only lapse and cease to be binding if: (i) the Scheme lapses or is withdrawn; or (ii) the Scheme has not become effective by 5:30 pm (London time) on or before the Longstop Date or such later time or date as the Bidder and CityFibre (with the consent of the Panel) agree.

CityFibre other shareholder irrevocable undertakings

Bidco has received irrevocable undertakings from Invesco Asset Management Limited, Sand Grove Capital Management LLP, Pelham Capital Ltd, Jupiter Asset Management Limited, Melqart Opportunities Master Funds Ltd., Arrowgrass Master Fund Ltd and MVN Asset Management, in respect of 362,940,667 CityFibre Shares, in respect of which it is able to exercise discretionary and voting control, representing approximately 57.37 per cent. of the existing issued ordinary share capital of CityFibre:

(a) to cast (or procure the casting of) all voting rights attaching to such CityFibre Shares in favour of the Scheme at the Scheme Court Meeting and in favour of the Resolution at the General Meeting; and

(b) if the Acquisition is structured as a Takeover Offer, to accept or procure the acceptance of such Takeover Offer in respect of all such CityFibre Shares.

Invesco

The irrevocable undertaking from Invesco will lapse and cease to be binding if: (i) the Scheme lapses or is withdrawn; (ii) the Scheme has not become effective by 5:30 pm (London time) on or before the Longstop Date or such later time or date as Bidco and CityFibre (with the consent of the Panel) agree; or (iii) an announcement is made in accordance with Rule 2.7 of the Code of a competing offer, whether made by way of an offer or a scheme of arrangement or any other transaction which constitutes a takeover offer for the purposes of the Code, for CityFibre and the consideration payable to CityFibre Shareholders per CityFibre Share under such competing offer is, in the opinion of Invesco, at least 10 per cent. higher than that payable pursuant to the Acquisition.

Sand Grove

The irrevocable undertaking from Sand Grove will lapse and cease to be binding if: (i) the Scheme lapses or is withdrawn; (ii) an announcement is made in accordance with Rule 2.7 of the Code of a competing offer for the entire issued and to be issued ordinary share capital of CityFibre (whether by means of a takeover offer or a scheme of arrangement), and such competing offer provides for consideration of more than a 10 per cent. premium to the price per share being offered at that time by Bidco and Bidco does not increase the consideration to be paid for the shares pursuant to the Acquisition to an equivalent amount per share within seven days of the competing announcement; or (iii) the Scheme has not become effective by 5:30 pm (London time) on or before the Longstop Date.

Pelham

The irrevocable undertaking from Pelham will lapse and cease to be binding if: (i) the Scheme lapses or is withdrawn; (ii) a third party announces a firm intention pursuant to Rule 2.7 of the Code to acquire the entire issued and to be issued share capital of CityFibre (whether by means of a takeover offer or scheme of arrangement) and such proposal provides for a consideration of more than 10 per cent. premium to the price per share then being offered by Bidco; or (iii) the Scheme has not become effective by 5:30 pm (London time) on or before the Longstop Date or such later time or date as Bidco and CityFibre (with the consent of the Panel) agree.

Jupiter

The irrevocable undertaking from Jupiter will lapse and cease to be binding if: (i) Bidco announces, with the consent of the Panel, that it does not intend to make or proceed with the Acquisition; (ii) the Scheme Document or the Offer Document (as the case may be) has not been posted within 14 days of the Announcement being released (or within such longer period, being not more than 21 days, as Bidco and CityFibre, with the consent of the Panel, determine); (iii) in the event that the Acquisition is implemented by way of the Scheme, the Scheme lapses or is withdrawn in accordance with its terms or otherwise becomes incapable of ever becoming effective; (iv) in the case of a Takeover Offer, the Takeover Offer is withdrawn or lapses in accordance with its terms; (v) a third party announces a firm intention pursuant to Rule 2.7 of the Code to acquire the entire issued and to be issued ordinary share capital of CityFibre (whether by means of a takeover offer or by way of a scheme of arrangement), such proposal provides for consideration of more than a 10 per cent. premium to the price per share being offered at that time by Bidco; (vi) the Scheme has not become effective by 5:30 pm (London time) on or before the Longstop Date or such later time or date as Bidco and CityFibre (with the consent of the Panel) agree; (vii) there is any material change to the terms of the Scheme or the Offer (as applicable); or (viii) Jupiter's discretionary investment mandate in respect of the relevant securities is revoked or terminated (provided that if Jupiter's discretionary investment mandate in respect of some only but not all of the relevant securities is revoked or terminated then Jupiter's obligations will terminate in respect of such relevant securities but will remain in force in respect of the remaining relevant securities for which its discretionary investment mandate remains in force).

Melqart

The irrevocable undertaking from Melqart will lapse and cease to be binding if: (i) the Scheme lapses or is withdrawn; (ii) an announcement is made in accordance with Rule 2.7 of the Code of a competing offer for the entire issued and to be issued ordinary share capital of CityFibre (whether by means of a takeover offer or a scheme of arrangement), and such competing offer provides for consideration of more than a 10 per cent. premium to the price per share being offered at that time by Bidco and Bidco does not increase the consideration to be paid for the shares pursuant to the Acquisition to an equivalent amount per share within seven days of the competing announcement; or (iii) the Scheme has not become effective by 5:30 pm (London time) on or before the Longstop Date.

Arrowgrass

The irrevocable undertaking from Arrowgrass will lapse and cease to be binding if: (i) the Scheme lapses or is withdrawn; (ii) an announcement is made in accordance with Rule 2.7 of the Code of a competing offer for the entire issued and to be issued ordinary share capital of CityFibre (whether by means of a takeover offer or a scheme of arrangement), and such competing offer provides for consideration of more than a 10 per cent. premium to the price per share being offered at that time by Bidco and Bidco does not increase the consideration to be paid for the shares pursuant to the Acquisition to an equivalent amount per share within seven days of the competing announcement; or (iii) the Scheme has not become effective by 5:30 pm (London time) on or before the Longstop Date.

MVN

The irrevocable undertaking from MVN will lapse and cease to be binding if: (i) the Scheme lapses or is withdrawn; (ii) an announcement is made in accordance with Rule 2.7 of the Code of a competing offer for the entire issued and to be issued ordinary share capital of CityFibre (whether by means of a takeover offer or a scheme of arrangement), and such competing offer provides for consideration of more than a 10 per cent. premium to the price per share being offered at that time by Bidco and Bidco does not increase the consideration to be paid for the shares pursuant to the Acquisition to an equivalent amount per share within seven days of the competing announcement; or (iii) the Scheme has not become effective by 5:30 pm (London time) on or before the Longstop Date.

Letter of intent