Cust Prop Inc Regulatory News (CREI)

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14 March 2024

abrdn Property Income Trust Limited ("API")

Update on the recommended all-share merger with Custodian Property Income REIT plc ("CREI")

Summary

Further to the announcement by the API Board on 22 February 2024, the API Board provides an update regarding its assessment of the recommended all-share merger with CREI (the "CREI Merger") and the possible all-share offer from Urban Logistics REIT plc ("Urban Logistics") (the "ULR Possible Offer") in the context of all of the strategic options available to API:

· The API Board has assessed the options available to API in detail with its professional advisers and, where appropriate, with input from API's investment manager.

· The API Board continues to believe that there is a compelling strategic and financial rationale for the CREI Merger, taking account of the Combined Group's prospects, notwithstanding the volatility in the CREI share price during the offer period.

· The API Board welcomes Urban Logistics' interest in API and has reviewed the ULR Possible Offer and an indicative alternative structure proposed by Urban Logistics, but has confirmed to Urban Logistics that it would not recommend either proposal to API Shareholders, if a firm offer were made on the terms proposed.

· The API Board has also updated its assessment of a potential managed wind-down ("Managed Wind-Down"), which now appears more viable than at the time of the Board's original review in light of increased visibility on property market conditions, but remains subject to risks relating to the quantum, value and timing of proceeds and associated returns of capital.

· Accordingly, and for the reasons outlined in this announcement, the API Board continues to believe that the CREI Merger represents the best outcome for API Shareholders, and reiterates its recommendation that API Shareholders vote in favour of the CREI Merger.

· Nevertheless, the API Board has decided that, while it continues to view a Managed Wind-Down as a less attractive option for API Shareholders than the CREI Merger, it intends to pursue such an option in the event that the CREI Merger is not approved by the requisite majorities of API and CREI Shareholders.

· While the API Board is keen to conclude this period of uncertainty for API Shareholders, the API Directors intend to adjourn the API Court Meeting and the API General Meeting which are currently convened for 20 March 2024 by one week, to 27 March 2024, in order to provide sufficient time for API Shareholders to assess the information contained in this and other recent announcements, and in light of the recent extension to the deadline for Urban Logistics to confirm its intentions.

James Clifton-Brown, Chair of API, said:

"The API Board has reviewed in detail the options available to API in the interests of all shareholders, including the competing merger proposals from CREI and Urban Logistics as well as a potential managed wind-down.

Having completed its comprehensive assessment, the API Board continues to believe that the CREI Merger represents a strategically consistent and significant enhancement to the status quo for API Shareholders. The CREI Merger offers continued exposure to a diversified, income-focused strategy as well as the growth prospects of the enlarged portfolio. Furthermore, the CREI Merger represents a premium to API's undisturbed share price and brings an increase in dividends, full dividend cover and enhanced scale and liquidity for API shareholders.

Accordingly, the API Board unanimously reaffirms its recommendation that API Shareholders vote in favour of the CREI Merger at the shareholder meetings which will now be held on 27 March."

Background

On 19 January 2024, the boards of API and CREI announced that they had reached agreement on the terms and conditions of a recommended all-share merger pursuant to which CREI would acquire the entire issued and to be issued ordinary share capital of API. The scheme document containing, among other things, the full terms and conditions of the CREI Merger, the notices of the API Court Meeting and the API General Meeting was posted to API Shareholders on 1 February 2024 (the "Scheme Document").

On 20 February 2024, the API Board confirmed that it had received an indicative proposal from Urban Logistics regarding a possible all-share offer for API on the terms set out in an announcement published by Urban Logistics on the same date. On 22 February 2024, the API Board announced an adjournment of the API Court Meeting and the API General Meeting from 28 February 2024 to 20 March 2024. The Panel subsequently announced that Urban Logistics must by 5.00pm on 13 March 2024 either announce a firm intention to make an offer for API under Rule 2.7 of the Code or announce that it does not intend to make an offer for API.

On 4 March 2024, CREI reaffirmed its convictions that the CREI Merger was the optimal outcome for shareholders in both API and CREI. On 13 March 2024, CREI announced an update on the CREI Merger including an improvement in management arrangements and fees for the Combined Group. As a result of this update, the Panel announced an extension to the deadline by which Urban Logistics must make clear its intentions in relation to API to 5.00pm on 15 March 2024.

Review Process

As set out in the announcement under Rule 2.7 of the Code (the "Announcement") published in connection with the CREI Merger, the API Board elected to undertake a comprehensive review of API's strategic options in Q3 2023, in light of the challenges faced by the listed real estate sector as a whole and API specifically. The review encompassed a wide range of options including enhancements to the status quo, potential mergers, a sale of the company for cash and a potential managed wind-down, with the objective of delivering an uplift in value for API Shareholders as well as (in the context of either a merger or API remaining a standalone company) increased scale, share liquidity, an enhanced and fully covered dividend and an improved debt profile. The review also considered ongoing feedback from API Shareholders.

The review resulted in the announcement of the CREI Merger on 19 January 2024 and the commencement of an offer period, during which any bona fide potential offerors for API (such as Urban Logistics) became entitled under Rule 21.3 of the Code to receive equivalent due diligence information, thereby ensuring a level playing field for any potential competing offerors for the benefit of API Shareholders.

As announced by the API Board on 22 February 2024, the purpose of adjourning the API Court Meeting and the API General Meeting was to allow time for the API Board to assess the ULR Possible Offer in the context of the CREI Merger and the other options available to API, which included a Managed Wind-Down, as well for Urban Logistics to complete its due diligence and make a binding offer.

The API Board has now completed its assessment of the options available to API, considering potential shareholder returns in the context of deliverability and the associated risks, rewards and uncertainties. The API Board has also taken into account increased visibility on potential improvements in property market conditions from future reductions in interest rates, among other factors. In addition, the Board is mindful of movements in the share prices of each of CREI since 19 January 2024 and Urban Logistics since 20 February 2024 and the prospects of each company. The API Board has set out its conclusions below.

CREI Merger

The views of the API Board on the CREI Merger were set out in the sections entitled "Background to, and reasons for, the Merger" and "Background to, and reasons for, the API Directors' recommendation" in the Scheme Document. The API Board stated that it was firmly of the view that a combination with CREI represented an attractive opportunity for API Shareholders to benefit from a premium to the prevailing API Share price, enhanced share liquidity and an increase in dividend income on an expected fully covered basis through continued participation in a diversified yet differentiated REIT of greater scale.

The API Board recognises the volatility in CREI's share price since the Announcement, as a consequence of (among other things) the differential in the undisturbed share price ratings between CREI and API, the arbitrage between the look-through offer price and API's own share price, and more recently the uncertainty arising from the ULR Possible Offer and the API Board's review of the competing offers and other strategic options.

Based on the Exchange Ratio of 0.78 new CREI Shares for each API Share, the CREI Merger currently represents an implied offer price per API Share of:

· 60.5 pence based on the Closing Price per CREI Share on 13 March 2024 (being the Last Business Day prior to the date of this announcement) of 77.5 pence, which represents a 25.9% premium to the undisturbed API Share price of 48.0 pence on 18 January 2024; and

· 57.2 pence based on the volume weighted average price per CREI Share between 21 February 2024 (following the announcement of the ULR Possible Offer) and 13 March 2024 of 73.3 pence, which represents a 19.1% premium to the undisturbed API Share price on 18 January 2024.

The Exchange Ratio was negotiated extensively between API and CREI in light of the cumulative and relative risks, rewards and financial effects of the CREI Merger for each company's shareholders. The calculation of the ratio was linked to the Rolled Forward Unaudited EPRA Net Tangible Asset value ("NTA") of each of CREI and API as at 31 December 2023 subject to reciprocal adjustments (as set out in the "Sources and Bases of Information" section of this announcement) which primarily related to a conventional adjustment for the fair value of debt and derivatives, reflecting the lower cost of CREI's debt and its longer duration relative to API's.

Among the financial benefits of the CREI Merger for API Shareholders is the 7.3% annualised uplift in dividends for API Shareholders, which are expected to be fully covered by earnings. The API Board also expects the Combined Group to deliver continued earnings and dividend growth.

Finally, the API Board also notes the announcements made by CREI on 4 March 2024, in which CREI reaffirmed its conviction in the CREI Merger in detail, and on 13 March 2024, in which it announced that it had agreed with Custodian Capital further amendments to the existing investment management agreement between CREI and its investment manager, Custodian Capital (the "Amended and Restated Investment Management Agreement") for the benefit of all shareholders in the Combined Group, including the removal of the previously agreed two-year extension to the term of Custodian Capital's appointment and the waiver of Custodian Capital's one-off project fee.

The API Board continues to believe that there is a compelling strategic and financial rationale for the CREI Merger, taking account of the Combined Group's prospects.

ULR Possible Offer

Urban Logistics announced the terms of a possible all-share offer for API on 20 February 2024, following its initial due diligence pursuant to Rule 21.3 of the Code. Since 20 February 2024, the API Board and Urban Logistics have engaged in further discussions regarding the terms of the ULR Possible Offer and API and Urban Logistics have conducted reciprocal due diligence.

The API Board welcomes the interest in API from Urban Logistics and acknowledges the time and effort that Urban Logistics has put into its proposals and in undertaking due diligence. The API Board has considered Urban Logistics' proposals and has studied its business in detail with its advisers.

Based on Urban Logistics' proposed exchange ratio of 0.469 new Urban Logistics shares for each API share, and adjusting the Urban Logistics share prices downward for the 2.45 pence special dividend payable to Urban Logistics shareholders only, the ULR Possible Offer currently represents an implied offer price per API Share of:

· 53.6 pence based on the Closing Price per Urban Logistics share on 13 March 2024 (being the Last Business Day prior to the date of this announcement) of 116.8 pence, which represents an 11.7% premium to the undisturbed API Share price of 48.0 pence on 18 January 2024; and

· 54.1 pence based on the volume weighted average price per Urban Logistics share between 21 February 2024 (following the announcement of the ULR Possible Offer) and 13 March 2024 of 117.9 pence, which represents a 12.8% premium to the undisturbed API Share price on 18 January 2024.

On 7 March 2024, Urban Logistics privately reiterated its proposal to the API Board on the same terms as originally announced. In parallel, Urban Logistics made a further indicative, conceptual proposal (the "ULR Alternative Proposal") involving a break-up of API, pursuant to which API's industrial and retail warehouses portfolios ("Portfolio 1") would be acquired by Urban Logistics on a share-for-share basis based on the original exchange ratio multiplied by the pro rata share of API's portfolio represented by Portfolio 1, and the remaining properties ("Portfolio 2") would remain within API, with the intention that API should dispose of the properties and return capital to API Shareholders. API's other assets and liabilities would be apportioned between the two portfolios.

The API Board recognises the potential merits for API Shareholders of a share-based transaction with Urban Logistics: the ULR Possible Offer currently represents a premium to the undisturbed API Share price; Urban Logistics is a constituent of the FTSE 250 and enjoys greater scale and share liquidity than API; Urban Logistics and its investment adviser have a strong track record as a specialist REIT in the logistics sector, which the API Board believes has attractive prospects; and the API Board recognises the potential for income growth and value appreciation in the context of a potential merger with Urban Logistics.

In assessing Urban Logistics' interest, however, the Board has also taken account of a number of drawbacks. The ULR Possible Offer would result in a reduction in earnings and dividends for API Shareholders (compared to both API standalone and especially the CREI Merger), with dividends also being less regular and with lower earnings cover compared to the CREI Merger. While the potential earnings and dividend impact stems primarily from the lower rental yield of Urban Logistics' portfolio, it also reflects a degree of refinancing risk. Furthermore, the ULR Possible Offer currently represents a discount to implied value of the CREI Merger. More generally, the API Board believes that a share-based transaction with Urban Logistics would constitute a deviation for API Shareholders away from the diversified, income-focused strategy in which they have chosen to invest, to a specialised, more total return-oriented strategy.

The API Board recognises that the ULR Alternative Proposal represents a means of potentially returning cash directly to API Shareholders. However, the API Board is concerned that the ULR Alternative Proposal involves Urban Logistics bilaterally acquiring for shares the most sought-after and liquid of API's assets at an exchange ratio originally based on a merger of the entire portfolios of API and Urban Logistics. As a consequence, the API Board believes that API Shareholders would lose out on value in respect of Portfolio 1 while remaining fully exposed to the more significant risks associated with Portfolio 2 as a smaller and less liquid company. The ULR Alternative Proposal would also be subject to greater execution risk and complexity, thereby prolonging the period of uncertainty for API Shareholders.

In light of these considerations, the API Board has rejected both of Urban Logistics' proposals and would not recommend either proposal to API Shareholders, if a firm offer were made to API Shareholders on those terms on or prior to the deadline set by the Panel.

Managed Wind-Down

Since the API Board's original review of strategic options, conditions in the underlying property market have improved moderately, reflecting a relatively resilient economic performance (despite macroeconomic and geopolitical uncertainties) and the prospect of interest rates being reduced. In light of this, and the competing merger proposals from CREI and Urban Logistics, the API Board has revisited in detail its assessment of a Managed Wind-Down of the API portfolio as an alternative to a merger, with the benefit of continued input from API's investment manager as well as the API Board's financial, tax, legal and property advisers.

With continued improvement in underlying property markets, and given the discount to NTA at which API has traded, the API Board believes that API would be able to dispose of assets in the direct property market at materially higher values than those implied by API's undisturbed and current share prices, with the assets in sought-after sectors such as industrials and logistics being the most liquid. However, the API Board is also mindful of the impact on pricing of bringing large volumes of assets to market as part of a public wind-down strategy; the sectoral breakdown of the API portfolio, particularly its office exposure; and the time taken to execute disposals, noting the size and relative granularity of the API portfolio, and taking into account the time value of money.

The API Board has reviewed a range of detailed disposal scenarios over an illustrative aggregate disposal period for the whole portfolio of 18-30 months, with capital being returned to API Shareholders from Q3 2024. The API Board has also considered the impact of: direct disposal costs (estimated to be 1.25-1.5% of proceeds); management fees (subject to any changes to maximise alignment with API Shareholders in this context); certain fixed ongoing corporate costs (which would gradually increase as a proportion of NTA); the gradual pay down of the existing debt facility maturing in April 2026; and costs associated with the review and implementation of strategic options as well as the means of returning capital to API Shareholders in future.

During the Managed Wind-Down, API Shareholders would continue to receive dividend income, but this income would diminish over time and would be materially lower than that received in the context of a merger, especially with CREI, which the API Board has factored into its comparative assessment. The API Board would anticipate API returning capital proceeds to API Shareholders through a combination of on-market share buybacks and periodic returns of capital through other means (such as tender offers or compulsory partial redemptions). The API Board recognises, however, that the accrual of proceeds prior to distribution may dilute shareholder returns. The API Board has also taken account of the anticipated gradual reduction in the size of API and hence the diminishing liquidity of its shares over the implementation period, potentially impacting their valuation and the ability of API Shareholders who wish to do so to realise their investment prior to the completion of the Managed Wind-Down.

One of the benefits of a Managed Wind-Down, in the API Board's view, would be the ability of API Shareholders to reinvest in larger and more liquid REITs of their choice, if they wished to retain exposure to the sector. However, in the expectation that disposals will partly be facilitated by further improvements in market conditions, the API Board is mindful of the likelihood of upward re-rating in the listed sector generally, which would narrow the spread between the value of proceeds received by API Shareholders from the Managed Wind-Down and the value of potential redeployment opportunities within the listed sector.

In summary, the API Board believes that a Managed Wind-Down presents a viable strategic option for API. However, the API Board is aware that many API Shareholders are seeking continued exposure to UK commercial property in a diversified format that generates an attractive ongoing dividend yield. The API Board also notes that implementation of a Managed Wind-Down would carry risks relating to the quantum, value and timing of proceeds and returns of capital, and hence API Shareholders' options for reinvestment.

Conclusion

The API Board has reviewed each of the strategic options available to it in detail together with its professional advisers and, where appropriate, API's investment manager. It has also compared these options with the possibility of API continuing as a standalone company. The API Board welcomes the feedback it has received from shareholders, the reaffirmation of CREI's conviction in the CREI Merger and the proposals from Urban Logistics.

For each of the options, the API Board has considered the potential returns for API Shareholders. The API Board has considered the dividend income and potential capital value or proceeds over a range of time periods, taking into account the time value of money. In each case, these quantitative considerations have been supplemented by an assessment of the deliverability, risks, rewards and uncertainties.

Following its review, and for the reasons outlined in this announcement, the API Board continues to believe that the CREI Merger represents the best outcome for API Shareholders, and reiterates its unanimous recommendation that API Shareholders vote in favour of the CREI Merger.

The API Board believes that the CREI Merger is a strategically consistent but significant enhancement of the status quo for API Shareholders. The CREI Merger offers continued exposure to a diversified, income-focused strategy. Furthermore, the CREI Merger represents a premium to the undisturbed share price and brings an increase in dividends, full dividend cover and enhanced scale and liquidity. In addition, the API Board notes that in exchanging their API Shares for new CREI Shares, API Shareholders stand to benefit from continued exposure to the enlarged portfolio and its growth prospects, as opposed to crystallising their position through an exit in cash.

The API Board also wishes to clarify that while it continues to view a Managed Wind-Down as a less attractive option for API Shareholders than the CREI Merger, it intends to pursue this option in the event that the CREI Merger is not approved by the requisite majorities of API and CREI Shareholders, recognising the challenges that API would continue to face as a standalone company. More information on this process would be set out at the appropriate time and following the conclusion of the current offer period, building upon the work already undertaken by the API Board, API's investment manager and API's advisers.

Recommendation

The API Directors, who have been so advised by Lazard & Co., Limited as to the financial terms of the CREI Merger, consider the terms of the CREI Merger to be fair and reasonable. In providing its advice to the API Directors, Lazard has taken into account the commercial assessments of the API Directors. Lazard is providing independent financial advice to the API

Directors for the purposes of Rule 3 of the Takeover Code.

Accordingly, the API Directors recommend unanimously that Scheme Shareholders vote in favour of the Scheme at the API Court Meeting and that API Shareholders vote in favour of the API Resolution to be proposed at the API General Meeting as the API Directors have irrevocably undertaken to do in respect of their own beneficial holdings of, in aggregate, 295,092 API Shares (representing approximately 0.08 per cent. of the API's total issued ordinary share capital as at the close of business on the Latest Practicable Date), as more fully described in paragraph 7.1 of Part X of the Scheme Document.

Adjournment of API Court Meeting and API General Meeting

Notices of the API Court Meeting and the API General Meeting are contained in Part XII and Part XIII respectively of the Scheme Document.

The API Board intends to adjourn the API Court Meeting and the API General Meeting so as to be reconvened and held on 27 March 2024 at 10.00 a.m. and 10.15 a.m. (or as soon thereafter as the API Court Meeting concludes or is further adjourned), respectively, at the offices of Addleshaw Goddard LLP, Milton Gate, 60 Chiswell Street, London EC1Y 4AG. Forms of Proxy in respect of the API Court Meeting and the API General Meeting should therefore now be returned so as to be received as soon as possible and in any event not later than:

· 10:00 a.m. on 25 March 2024 in respect of the API Court Meeting; and

· 10:15 a.m. on 25 March 2024 in respect of the API General Meeting.

Accordingly, the API Directors recommend that API Shareholders do not attend the API Court Meeting and the API General Meeting on 20 March 2024.

API Shareholders who have already submitted Forms of Proxy for the API Court Meeting and the API General Meeting and do not wish to change their voting instructions, do not need to take any further action as their Forms of Proxy will continue to be valid in respect of the API Court Meeting and the API General Meeting.

API Shareholders who have submitted Forms of Proxy for the API Court Meeting and / or the API General Meeting and who now wish to change their voting instructions, should contact API's registrar, Computershare, on +44 (0)370 707 4040. Calls are charged at the standard geographical rate and will vary by provider. Calls from outside of the United Kingdom will be charged at the applicable international rate. Lines will be open between 8.30 a.m. to 5:30 p.m., Monday to Friday excluding public holidays in England and Wales. Computershare cannot provide any financial, legal or tax advice and calls may be monitored for security and training purposes.

API Shareholders are also reminded that completion and return of a Form of Proxy, or the appointment of a proxy electronically using CREST, will not prevent them from voting at the API Court Meeting or the API General Meeting in person. Please refer to the Scheme Document for further information.

Conditions 2(a)(ii) and 2(b)(ii) to the CREI Merger set out in the Scheme Document state that the CREI Merger is conditional on the API Court Meeting and the API General Meeting being held on or before the 22nd day after the expected date of the API Court Meeting and API General Meeting set out in the Scheme Document (or such later date (if any) as may be agreed between CREI and API with the consent of the Panel and (if required) that the Court may allow (the "API Meeting Long Stop Date Conditions"). CREI has agreed with API, and received consent from the Panel, to a later long stop date for the API Court Meeting and the API General Meeting to be held, for the purposes of the API Meeting Long Stop Date Conditions in the Scheme Document, such date being the 22nd day after the reconvened dates for the API Court Meeting and API General Meeting referred to above.

Timetable Update

An updated expected timetable for the CREI Merger is set out below.

_______________________

(1) It is requested that BLUE Forms of Proxy for the API Court Meeting be lodged no later than 48 hours before the time and date set for the API Court Meeting. A copy of a completed and signed BLUE Form of Proxy not so lodged may be handed to the Chair of the API Court Meeting at any time before the time that the API Court Meeting is due to commence and will still be valid.

(2) WHITE Forms of Proxy for the API General Meeting must be lodged no later than 48 hours before the time and date set for the API General Meeting. WHITE Forms of Proxy for the API General Meeting not lodged by this time will be invalid.

(3) If either the API Court Meeting or the API General Meeting is adjourned, the Voting Record Time for the relevant adjourned Meeting will be 6.00 p.m. on the date falling two days before the date of the adjourned Meeting.

(4) To commence at 10.15 a.m. or as soon thereafter as the API Court Meeting shall have concluded or been adjourned.

General

Capitalised terms in this announcement, unless otherwise defined, have the same meaning as set out in the Scheme Document, a copy of which is available on API's website at www.abrdnpit.co.uk. All references to times in this announcement are to London time unless otherwise stated.

This announcement has been made without the consent of Urban Logistics.

Enquiries:

Sources and Bases of Information

1. All share price data is sourced from FactSet and Bloomberg data as at the applicable date

2. "Undisturbed" share prices for each of API and CREI are as at 18 January 2024, and for Urban Logistics as at 20 February 2024

3. "Current" share prices for each of API, CREI and Urban Logistics are as at 13 March 2024

4. Unless otherwise stated, all other financial information relating to the CREI Merger is as set out in the Announcement and Scheme Document

5. The breakdown of the aggregate net adjustment of 6.8% of NTA in arriving at the fixed Exchange Ratio for the CREI Merger is as follows:

i. post balance sheet asset disposals, representing 0.3% of the aggregate net adjustment;

ii. the fair value of each company's debt and derivatives, representing 3.6% of the aggregate net adjustment;

iii. the relative levels of dividend cover between the two companies, representing 1.5% of the aggregate net adjustment, reflecting the fact that CREI pays a fully covered dividend and API an uncovered dividend; and

iv. the costs expected to be incurred by each party in connection with the CREI Merger, representing 1.4% of the aggregate net adjustment, reflecting the higher burden of costs (including IMA termination and the waiver of debt change-of-control provisions) as a percentage of NTA relative to CREI for API as the smaller company.

Important notices

This announcement is not intended to, and does not, constitute or form part of any offer, invitation or solicitation of any offer to purchase, otherwise acquire, subscribe for, sell or otherwise dispose of any securities, or the solicitation of any vote or approval in any jurisdiction, pursuant to this announcement or otherwise. There can be no certainty that an offer will be made by Urban Logistics.

The release, publication or distribution of this announcement in jurisdictions outside the United Kingdom may be restricted by law and therefore persons into whose possession this announcement comes should inform themselves about, and observe such restrictions. Any failure to comply with such restrictions may constitute a violation of the securities law of any such jurisdiction.

Lazard & Co., Limited ("Lazard"), which is authorised and regulated in the United Kingdom by the Financial Conduct Authority, is acting exclusively as financial adviser to API and no one else in connection with the matters set out in this announcement and will not be responsible to anyone other than API for providing the protections afforded to clients of Lazard nor for providing advice in relation to the matters set out in this announcement. Neither Lazard nor any of its 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 Lazard in connection with this announcement, any statement contained herein or otherwise.

Winterflood Securities Limited ("Winterflood"), which is authorised and regulated by the Financial Conduct Authority in the United Kingdom, is acting exclusively for API and no-one else in connection with the matters set out in this announcement and will not be responsible to anyone other than API for providing the protections afforded to customers of Winterflood or for providing advice in relation to the matters set out in this announcement. Neither Winterflood nor any of its 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 Winterflood in connection with this announcement, any statement contained herein or otherwise.

Publication on a website

In accordance with Rule 26.1 of the Takeover Code, a copy of this announcement will be made available, subject to certain restrictions relating to persons resident in Restricted Jurisdictions, on and API's website at www.abrdnpit.co.uk by no later than 12 noon (London time) on the first business day following the date of this announcement.

For the avoidance of doubt, neither the contents of these websites nor the contents of any websites accessible from any hyperlinks is incorporated into or forms part of this announcement.

Disclosure requirements of the Code

Under Rule 8.3(a) of the Code, any person who is interested in 1 per cent. 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 Code, any person who is, or becomes, interested in 1 per cent. 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 of the Code. A Dealing Disclosure by a person to whom Rule 8.3(b) of the Code 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 securities exchange offeror, they will be deemed to be a single person for the purpose of Rule 8.3 of the Code.

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 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 Panel's website at 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. You should contact the Panel's Market Surveillance Unit on +44 (0)20 7638 0129 if you are in any doubt as to whether you are required to make an Opening Position Disclosure or a Dealing Disclosure.