21 Jun 2021 07:00
LSR Group announces tender offer for global depositary receipts and intended cancellation of their listing on the London Stock Exchange
PJSC LSR Group (“LSR” or the “Company”) (LSE: LSRG; MOEX: LSRG), one of the leading real estate developers and building materials producers in Russia, today announces that on 20 June 2021 the Company's Board of Directors considered the equity capital markets strategy of the Company and concluded that maintaining the listing of its Regulation S (ISIN US50218G2066) and Rule 144A (ISIN US50218G1076) global depositary receipts, representing interests in the Company's ordinary shares (the “GDRs”) on the London Stock Exchange (the “LSE”) is not a strategic priority of LSR.
Following such decision of the Board, the Company announces today of its intention for the GDRs to be removed from the Official List of the Financial Conduct Authority and the trading of GDRs on the Main Market of the LSE to be cancelled (the "Delisting"). An application has been made to the Financial Conduct Authority for the GDRs to be removed from the Official List of the Financial Conduct Authority and to the London Stock Exchange for trading in the GDRs to be cancelled with effect from 2 August 2021.
In the context of the above Delisting, low liquidity of the GDRs and Company’s strong commitment to best corporate governance practices, the Board of Directors also approved a tender offer buyback, to be undertaken by AO STROIKORPORACIYA, a wholly owned subsidiary of the Company, inviting GDR holders to submit tenders for the sale to AO STROIKORPORACIYA for cash of GDRs held by them at $2.11 per one GDR (the “Tender Offer”). Further details regarding the Tender Offer are set out below.
In arriving at the decision regarding Delisting, the Board of Directors considered that:
The benefits of the listing on the Moscow Exchange have become more evident. The trading volume of LSR's ordinary shares (ISIN RU000A0JPFP0) (the “Shares”) on the Moscow Exchange is substantially higher than the volume of trading of the GDRs on the LSE. According to Bloomberg, in the first five months of 2021 ending 31 May 2021, average daily trading volume of the Shares was approximately $1.8m, while that of GDRs – $0.3mDelisting of the GDRs will consolidate free-float and trading on the Moscow Exchange and may further enhance liquidity and thus improve equity capital markets profile of LSRListing of the GDRs on the LSE is associated with additional reporting and administrative costs.Considering all of the above factors, the Board of Directors concluded that Delisting is a logical step towards successful implementation of LSR’s capital markets strategy, while the Tender Offer will provide GDR holders with an opportunity to sell their GDRs with a premium to the current market price. The Company engaged VTB Capital plc as financial advisor to the Company to assist with evaluation of these matters.
Following Delisting of the GDRs, GDR holders that choose not participate in the Tender Offer may:
convert their GDRs into the ordinary shares, traded on the Moscow Exchange;continue to own delisted GDRs, retaining the right to vote and receive dividends on the underlying shares; orsell their GDRs on the over-the-counter market.In view of the Tender Offer and Delisting, as well to help maintain an orderly market in the trading of LSR's securities, with effect from close of business on 18 June the depositary (Deutsche Bank Trust Company Americas) has closed its books to the issuance of new GDRs against deposits of Shares, until further notice. GDRs issued prior to this date are not affected and may be traded or converted into Ordinary Shares in accordance with their terms.
The Company intends to retain GDR programme following delisting.
The existing listing of the Company's Shares on the Moscow Exchange under the symbol "LSRG" will continue.
The Tender Offer
21 June 2021 the shareholders of AO STROIKORPORACIYA, a subsidiary of PJSC LSR Group, have approved the Tender Offer. The price of the Tender Offer is $2.11 per GDR, representing a premium of 3.4% to the closing price on the LSE as of 18 June 2021 and 2.6% to the 1-month volume weighted average price on the LSE.
The Tender Offer is to all Regulation S and Rule 144A GDR holders, other than GDRs held by the majority shareholder of the Company and its affiliates and the Company's subsidiaries. Maximum number of GDRs that may be tendered in the Tender Offer corresponds to 15.08% of the Company’s issued share capital.
American Stock Transfer & Trust Company is the Tender Agent.
Expected Timetable of the Tender Offer and Delisting of the GDRs from the LSE
Day | Event |
On 21 June 2021 | Announcement of the Tender Offer and commencement of the Tender Offer period |
12:00 p.m., London time on 20 July 2021 (Expiration Time) | Deadline for submission of tenders Clearing Systems, their respective participants and the brokers or other financial intermediaries through which you hold GDRs will establish their own cut-off dates and times for the tender of the GDRs, which will be earlier than the Expiration Time |
On or about 21 July 2021 | Announcement of the results of the Tender Offer |
On or about 21 July 2021 – 26 July 2021 | Transfer of the aggregate Purchase Price in U.S. dollars to the Tender Agent for further distribution to holders of the GDRs that have been tendered and accepted |
30 July 2021 | The last day of dealings in the GDRs on the London Stock Exchange |
At or around 8.00 a.m. London time on 2 August 2021 | Cancellation of the GDR listing on the London Stock Exchange takes effect |
Detailed information on the Tender Offer can be found in the Tender Offer Memorandum. The Tender Offer Memorandum and related documents are now available on the Company's website at https://www.lsrgroup.ru/en/investor-relations/tender-offer.
For more information please contact:
Department of Investor Relations and Sustainable DevelopmentE-mail: IR@lsrgroup.ru
About LSR Group:
PJSC LSR Group is a real estate development and building materials company founded in 1993 and operating in a number of complementary market segments. Its core business areas are production of building materials and real estate development and construction. LSR Group's main operations are located in St. Petersburg and Leningrad Region, Moscow and Moscow region and Yekaterinburg. As of 31 December 2020 (according to Knight Frank), the net sellable area of projects in LSR Group’s real estate portfolio amounts to 8.2 million m2 with the market value of RUB 276 billion. In accordance with its audited IFRS consolidated financial statements for 2020, LSR Group reported revenue of RUB 118.1 billion, Adjusted EBITDA of RUB 27.4 billion and Net Profit of RUB 12.0 billion. Ordinary shares of the Company are traded on the Moscow Exchange (MOEX: LSRG) and GDRs representing its ordinary shares are traded on the London Stock Exchange (LSE: LSRG).
www.lsrgroup.ru
THIS ANNOUNCEMENT IS NOT INTENDED TO, AND DOES NOT CONSTITUTE, OR FORM PART OF, AN OFFER TO SELL OR AN INVITATION TO PURCHASE, EXCHANGE OR SUBSCRIBE FOR ANY SECURITIES IN ANY JURISDICTION. THIS ANNOUNCEMENT DOES NOT CONSTITUTE A PROSPECTUS OR A PROSPECTUS EQUIVALENT DOCUMENT.
THE RELEASE, PUBLICATION OR DISTRIBUTION OF THIS ANNOUNCEMENT IN JURISDICTIONS MAY BE RESTRICTED BY LAW AND THEREFORE PERSONS SHOULD INFORM THEMSELVES ABOUT THE LAWS OF THEIR JURISDICTION, AND OBSERVE ANY APPLICABLE REQUIREMENTS
NEITHER THE UNITED STATES SECURITIES AND EXCHANGE COMMISSION ("SEC") NOR ANY U.S. STATE SECURITIES COMMISSION OR REGULATORY AUTHORITY HAS APPROVED OR DISAPPROVED OF THE TENDER OFFER, PASSED UPON THE FAIRNESS OR MERITS OF THE TENDER OFFER OR DETERMINED WHETHER THE TENDER OFFER MEMORANDUM (THE "MEMORANDUM") IS ACCURATE OR COMPLETE. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENCE IN THE UNITED STATES.
THE INFORMATION CONTAINED IN THE MEMORANDUM IS ADDRESSED EXCLUSIVELY TO THE HOLDERS OF GDRS OF LSR. NEITHER THE MEMORANDUM NOR THE TENDER OFFER NOR ANY INFORMATION CONTAINED HEREIN CONSTITUTE AN OFFER ("OFERTA") PURSUANT TO RUSSIAN LAW, OR AN ADVERTISEMENT, OR AN OFFER OF SECURITIES TO AN UNLIMITED NUMBER OF PERSONS WITHIN OR OUTSIDE THE TERRITORY OF THE RUSSIAN FEDERATION, OR VOLUNTARY TENDER OFFER OR MANDATORY TENDER OFFER UNDER RUSSIAN LAW, OR AN AUCTION UNDER ARTICLES 447-449 OF THE CIVIL CODE OF THE RUSSIAN FEDERATION AND APPLICABLE RUSSIAN LAW. NEITHER THE MEMORANDUM NOR THE TENDER OFFER CONSTITUTE OR ARE INTENDED FOR PLACEMENT OR PUBLIC CIRCULATION OF SECURITIES OF FOREIGN ISSUERS IN THE RUSSIAN FEDERATION. GDRS OF LSR TO WHICH THE TENDER OFFER RELATES ARE NEITHER REGISTERED IN THE RUSSIAN FEDERATION NOR ADMITTED TO PLACEMENT, PUBLIC PLACEMENT OR PUBLIC CIRCULATION IN THE RUSSIAN FEDERATION IN ACCORDANCE WITH ARTICLE 51.1 OF RUSSIAN FEDERAL LAW DATED 22 APRIL 1996 NO. 39-FZ "ON THE SECURITIES MARKET" (AS AMENDED) ("RUSSIAN SECURITIES MARKET LAW"). THE TENDER AND PURCHASE OF GDRS OF LSR WILL BE CARRIED OUT EXCLUSIVELY IN ACCORDANCE WITH THE PROCEDURES SET FORTH IN THE MEMORANDUM. ANY INFORMATION IN THE MEMORANDUM AND RELATED DOCUMENTS IN RESPECT OF GDRS IS ADDRESSED IN THE RUSSIAN FEDERATION SOLELY TO PERSONS WHO ARE "QUALIFIED INVESTORS" AS DEFINED IN THE RUSSIAN SECURITIES MARKET LAW.
THE TENDER OFFER DOES NOT CONSTITUTE AN OFFER TO BUY OR THE SOLICITATION OF AN OFFER TO SELL SECURITIES IN ANY CIRCUMSTANCES IN WHICH SUCH TENDER OFFER OR SOLICITATION IS UNLAWFUL. IN THOSE JURISDICTIONS WHERE THE SECURITIES OR OTHER LAWS REQUIRE THE TENDER OFFER TO BE MADE BY A LICENSED BROKER OR DEALER, THE TENDER OFFER SHALL BE DEEMED TO BE MADE ON BEHALF OF AO STROIKORPORACIYA (THE "OFFEROR") BY ONE OR MORE REGISTERED BROKERS OR DEALERS LICENSED UNDER THE LAWS OF SUCH JURISDICTION NEITHER THE DELIVERY OF THE MEMORANDUM NOR ANY PURCHASE OF SECURITIES SHALL, UNDER ANY CIRCUMSTANCES, CREATE ANY IMPLICATION THAT THE INFORMATION CONTAINED HEREIN IS CURRENT AS OF ANY TIME SUBSEQUENT TO THE DATE OF SUCH INFORMATION.
THE TENDER OFFER IS BEING MADE TO GDR HOLDERS OF LSR RESIDENT IN THE UNITED STATES IN RELIANCE ON, AND COMPLIANCE WITH, SECTION 14(E) OF THE EXCHANGE ACT AND REGULATION 14E THEREUNDER TO THE EXTENT APPLICABLE. THE TENDER OFFER IS BEING MADE IN THE UNITED STATES BY THE OFFEROR AND NO ONE ELSE.
THE MEMORANDUM HAS BEEN ISSUED BY, AND IS THE SOLE RESPONSIBILITY OF THE OFFEROR. THE MEMORANDUM, AND ANY INVESTMENT ACTIVITY TO WHICH IT RELATES, IS AVAILABLE ONLY TO (I) PERSONS WHO ARE OUTSIDE THE UNITED KINGDOM OR (II) INVESTMENT PROFESSIONALS FALLING WITHIN ARTICLE 19(5) OF THE FINANCIAL SERVICES AND MARKETS ACT 2000 (FINANCIAL PROMOTION) ORDER 2005 (THE "ORDER") OR (III) HIGH NET WORTH COMPANIES FALLING WITHIN ARTICLE 49(2)(A) TO (D) OF THE ORDER OR (IV) PERSONS WITHIN THE SCOPE OF ARTICLE 43 OF THE ORDER OR (V) ANY OTHER PERSONS TO WHOM IT MAY OTHERWISE LAWFULLY BE MADE UNDER THE ORDER (ALL SUCH PERSONS TOGETHER BEING REFERRED TO AS "RELEVANT PERSONS"). THE MEMORANDUM MAY NOT BE ACTED OR RELIED ON IN THE UNITED KINGDOM BY ANYONE WHO IS NOT A RELEVANT PERSON.
NEITHER THE MEMORANDUM NOR THE TENDER OFFER NOR ANY INFORMATION CONTAINED HEREIN CONSTITUTE OR MAY BE CONSTRUED AS CONSTITUTING A PUBLIC OFFER, ADVERTISEMENT OR AN OFFER OF SECURITIES TO MEMBERS OF THE PUBLIC WITHIN OR OUTSIDE THE TERRITORY OF THE RUSSIAN FEDERATION, OR A VOLUNTARY OR MANDATORY TENDER OFFER UNDER RUSSIAN LAW. THE MEMORANDUM IS NOT A TENDER NOTICE (PUBLIC TENDER NOTICE), NOR AIMED AT ENTERING INTO AGREEMENTS FOR THE PURCHASE OF SECURITIES AT PUBLIC SALES, INCLUDING BY MEANS OF AN AUCTION, PUBLIC TENDER OR BY OTHER MEANS ENVISAGED BY THE LEGISLATION OF THE RUSSIAN FEDERATION. NEITHER THE MEMORANDUM NOR THE INFORMATION CONTAINED HEREIN CONSTITUTES OR IS INTENDED FOR THE PUBLIC PLACEMENT OR CIRCULATION OF THE SECURITIES OF FOREIGN ISSUERS IN THE RUSSIAN FEDERATION. NEITHER THE GDRS, NOR ANY DOCUMENT TO WHICH THE TENDER OFFER RELATES, HAVE BEEN OR WILL BE REGISTERED WITH THE CENTRAL BANK OF RUSSIA (THE "CBR") AND ARE NOT INTENDED FOR PLACEMENT, PUBLIC PLACEMENT OR PUBLIC CIRCULATION IN THE RUSSIAN FEDERATION. ANY INFORMATION IN THE MEMORANDUM, WHICH RELATES TO THE GDRS AND/OR THE TENDER OF THE GDRS, IS ADDRESSED IN THE RUSSIAN FEDERATION SOLELY TO PERSONS WHO ARE "QUALIFIED INVESTORS" AS DEFINED IN THE RUSSIAN SECURITIES MARKET LAW OR PERSONS OUTSIDE THE RUSSIAN FEDERATION.
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