QRT.L Regulatory News (QRT)

THIS ANNOUNCEMENT AND THE INFORMATION CONTAINED HEREIN IS RESTRICTED AND IS NOT FOR PUBLICATION, RELEASE OR DISTRIBUTION, DIRECTLY OR INDIRECTLY, IN WHOLE OR IN PART, IN OR INTO OR FROM THE UNITED STATES, AUSTRALIA, CANADA, JAPAN, THE REPUBLIC OF SOUTH AFRICA OR ANY OTHER JURISDICTION IN WHICH IT WOULD BE UNLAWFUL TO DO SO. FURTHER, THIS ANNOUNCEMENT IS FOR INFORMATION PURPOSES ONLY AND SHALL NOT CONSTITUTE AN OFFER TO SELL OR THE SOLICITATION OF AN OFFER TO BUY, SUBSCRIBE FOR OR OTHERWISE ACQUIRE ANY SHARES OR OTHER SECURITIES OF THE QUARTO GROUP INC. IN THE UNITED STATES (OR TO ANY U.S. PERSON), AUSTRALIA, CANADA, JAPAN, THE REPUBLIC OF SOUTH AFRICA OR ANY OTHER JURISDICTION IN WHICH ANY SUCH OFFER OR SOLICITATION WOULD BE UNLAWFUL. NEITHER THIS ANNOUNCEMENT NOR ANYTHING CONTAINED HEREIN SHALL FORM THE BASIS OF, OR BE RELIED UPON IN CONNECTION WITH, ANY SUCH OFFER, SOLICITATION OR COMMITMENT WHATSOEVER IN ANY OF THOSE JURISDICTIONS.

This announcement contains inside information for the purposes of the Market Abuse Regulation (596/2014).

The Quarto Group Inc.

("Company", "Quarto" or "Group")

Result of Open Offer

The Quarto Group Inc., the illustrated book publisher and distribution group, today announces that it has successfully raised £13.9 million (approximately $18.2 million) in gross proceeds (£12.8 million (approximately $16.7 million) net of expenses) by the issue of 20,444,550 New Common Shares at 68 pence per New Common Share by way of an Open Offer to the Company's existing Shareholders ("Open Offer"). The Open Offer was fully underwritten by two groups of the Company's Shareholders, namely the Lau Underwriter and the Giunti Parties (together, "Underwriters").

The Open Offer closed for acceptances at 11.00 a.m. on 31 January 2020 in accordance with its terms. The Company is pleased to announce that it has received valid acceptances under the Open Offer in respect of 11,731,505 New Common Shares from Qualifying Shareholders, including applications under the Excess Application Facility. This represents 57.382 per cent. of the New Common Shares offered, with the remaining New Common Shares being taken up by the Lau Underwriter and the Giunti Parties (pursuant to their respective Open Offer Entitlements and the Underwriting Agreements).

The Open Offer is conditional on, among other things:

(i) Resolution 1 being passed at the Special Meeting which occurred on 31 January 2020;

(ii) Admission becoming effective by not later than 8.00 a.m., today, 3 February 2019 (or such later time and/or date as the Company and the Sponsor may agree); and

(iii) the Sponsor Agreement otherwise becoming unconditional in all respects and not having been terminated in accordance with its terms prior to Admission.

Application has been made for the New Common Shares to be admitted to the premium listing segment of the Official List and to the London Stock Exchange for the New Common Shares to be admitted to trading on its Main Market for listed securities ("Admission"). It is expected that Admission will become effective and that dealings will commence in the New Common Shares at 8.00 a.m., today, 3 February 2020.

Following Admission, the total number of voting shares in issue will be 40,889,100. This figure may be used by shareholders as the denominator for the calculations by which they determine if they are required to notify their interest in, or a change to their interest in, the Company under the FCA's Disclosure Guidance and Transparency Rules.

Use of proceeds

The Company intends to use the net proceeds of the Open Offer of £12,752,294 (approximately $16,705,505) to reduce the Group's existing bank debt as required by the Syndicate under the terms of the Amended Facilities Agreement.

All capitalised terms in this announcement have the meaning given to them in the Prospectus, unless otherwise defined herein.

The person responsible for releasing this announcement on behalf of the Company is Michael Clarke, the Company Secretary.

US Securities Law Restrictions

Upon Admission, the New Common Shares will trade in the Company's new restricted line of Common Shares under the symbol QRTR, and the New Common Shares, as represented by Depository Interests, will be held in the CREST system and will be segregated into a separate trading system within CREST identified with the marker "REG S" and ISIN USU748092009.

The New Common Shares have not been, and will not be, registered under the Securities Act or under any securities laws of any state or other jurisdiction of the United States.

The New Common Shares offered in "offshore transactions" (as defined in Regulation S) to non-U.S. Persons in the Open Offer will be subject to the conditions listed under Rule 903(b)(3), or Category 3, of Regulation S. Under Category 3, "offering restrictions" (as defined in Regulation S) must be in place in connection with the Open Offer and additional restrictions are imposed on resales of the New Common Shares. Further details of these restrictions are set out in Part 17 of the Prospectus. The New Common Shares will be "restricted securities" as defined in Rule 144 under the Securities Act. Purchasers of the New Common Shares may not offer, sell, pledge or otherwise transfer New Common Shares, directly or indirectly, in or into the United States or to, or for the account or benefit of, any U.S. Person, except pursuant to a transaction meeting the requirements of Rules 901 to 905 (including the Preliminary Notes) of Regulation S, pursuant to an effective registration statement under the Securities Act or pursuant to an exemption from the registration requirements of the Securities Act. All New Common Shares sold to non-U.S. Persons in "offshore transactions" (as defined in Regulation S) in the Open Offer will be subject to these restrictions until the expiration of the Distribution Compliance Period. These restrictions may remain in place or be reintroduced in relation to the New Common Shares following expiry of the Distribution Compliance Period, at the discretion of the Company, such as in the event the Company issues additional Common Shares under the same ISIN as the New Common Shares. Hedging transactions in the New Common Shares may not be conducted, directly or indirectly, unless in compliance with the Securities Act.

The New Common Shares held in CREST and the New Common Shares held in certificated form will bear a legend (electronically in the case of the former), inter alia, describing the restrictions on transfer thereof and prohibiting hedging transactions in the New Common Shares unless in compliance with the Securities Act.

About The Quarto Group

The Quarto Group (LSE: QRT) creates a wide variety of books and intellectual property products, with a mission to inspire life's experiences. Produced in many formats for adults, children and the whole family, our products are visually appealing, information rich and stimulating.

The Group encompasses a diverse portfolio of imprints and businesses that are creatively independent and expert in developing long-lasting content across specific niches of interest.

Quarto sells and distributes its products globally in over 50 countries and 40 languages, through a variety of sales channels, partnerships and routes to market.

Quarto employs c.330 talented people in the US and the UK. The group was founded in London in 1976. It is domiciled in the US and listed on the London Stock Exchange. 

For more information, visit quarto.com or follow us on Twitter at @TheQuartoGroup.

IMPORTANT NOTICE:

This announcement is for information purposes only and is not intended to and does not constitute or form part of any offer or invitation to purchase or subscribe for, or any solicitation to purchase or subscribe for New Common Shares in any jurisdiction. No offer or invitation to purchase or subscribe for, or any solicitation to purchase or subscribe for New Common Shares will be made in any jurisdiction in which such an offer or solicitation is unlawful. The information contained in this announcement is not for release, publication or distribution to U.S. Persons or persons in Excluded Territories, and should not be distributed, forwarded to or transmitted in or into or from any jurisdiction, where to do so might constitute a violation of local securities laws or regulations.

This announcement is not for release, publication or distribution, directly or indirectly, in or into or from the United States. This announcement is not an offer of securities for sale in the United States. The New Common Shares have not been and will not be registered under the Securities Act or under any securities laws of any state or other jurisdiction of the United States and may not be offered, sold, taken up, exercised, resold, renounced, transferred or delivered, directly or indirectly, within the United States, or offered, sold, taken up, exercised, resold, renounced, transferred or delivered to, or for the account or benefit of, U.S. Persons, except pursuant to an applicable exemption from or in a transaction not subject to the registration requirements of the Securities Act and in compliance with any applicable securities laws of any state or other jurisdiction of the United States. Hedging transactions in the New Common Shares may not be conducted, directly or indirectly, unless in compliance with the Securities Act. No public offering of securities is being made in the United States.

The New Common Shares have not been and will not be registered under the applicable securities laws of any of the Excluded Territories and, subject to certain limited exceptions, the New Common Shares may not be offered or sold in the Excluded Territories or to, or for the account or benefit of, any U.S. Person or resident of the Excluded Territories. There will be no public offer of securities in the Excluded Territories.

The distribution of this announcement into jurisdictions other than the United Kingdom may be restricted by law, and, therefore, persons into whose possession this announcement comes should inform themselves about and observe any such restrictions. Any failure to comply with any such restrictions may constitute a violation of the securities laws of such jurisdiction. In particular, subject to certain limited exceptions, this announcement should not be distributed, forwarded to or transmitted in or into or from the United States or any other Excluded Territory.

This announcement contains forward-looking statements that are based on current expectations or beliefs, as well as assumptions about future events. These forward-looking statements can be identified by the fact that they do not relate only to historical or current facts. Forward-looking statements often use words such as "anticipate", "target", "expect", "estimate", "intend", "plan", "goal", "believe", "will", "may", "should", "would", "could", "is confident", or other words of similar meaning. Undue reliance should not be placed on any such statements because they speak only as at the date of this announcement and, by their very nature, they are subject to known and unknown risks and uncertainties and can be affected by other factors that could cause actual results, and Quarto's plans and objectives, to differ materially from those expressed or implied in the forward-looking statements.

There are a number of factors which could cause actual results to differ materially from those expressed or implied in forward-looking statements. Among the factors that could cause actual results to differ materially from those described in the forward-looking statements are: increased competition, the loss of or damage to one or more key customer relationships, changes to customer ordering patterns, delays in obtaining customer approvals for engineering or price level changes, the failure of one or more key suppliers, the outcome of business or industry restructuring, the outcome of any litigation, changes in economic conditions, currency fluctuations, changes in interest and tax rates, changes in raw material or energy market prices, changes in laws, regulations or regulatory policies, developments in legal or public policy doctrines, technological developments, the failure to retain key management, or the key timing and success of future acquisition opportunities or major investment and research and development projects.

The Company is not under any obligation to update or revise publicly any forward-looking statement contained within this announcement, whether as a result of new information, future events or otherwise, other than in accordance with their legal or regulatory obligations (including under the Listing Rules, the Disclosure Guidance and Transparency Rules and the Prospectus Rules).