Stellar Diamonds Regulatory News (STEL)

THIS ANNOUNCEMENT AND THE INFORMATION CONTAINED HEREIN IS RESTRICTED AND IS NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN WHOLE OR IN PART, IN, INTO OR FROM THE UNITED STATES OF AMERICA, CANADA, JAPAN, OR THE REPUBLIC OF SOUTH AFRICA, OR IN, INTO OR FROM ANY JURISDICTION WHERE TO DO SO WOULD CONSTITUTE A VIOLATION OF THE RELEVANT LAWS OR REGULATIONS OF THAT JURISDICTION. SEE THE IMPORTANT NOTICE AT THE END OF THIS ANNOUNCEMENT.

THE FOLLOWING ANNOUNCEMENT IS NOT A PROSPECTUS OR PROSPECTUS EQUIVALENT DOCUMENT AND INVESTORS SHOULD NOT MAKE ANY INVESTMENT DECISION IN RELATION TO NEWFIELD RESOURCES LIMITED SHARES EXCEPT ON THE BASIS OF THE INFORMATION IN THE SCHEME CIRCULAR WHICH IS PROPOSED TO BE PUBLISHED IN DUE COURSE.

26 March 2018

Recommended Offer

for

Stellar Diamonds plc ("Stellar")

by

Newfield Resources Limited ("NWF")

to be effected by means of a scheme of arrangement under Part 26 of the Companies Act 2006

POSTING OF SCHEME CIRCULAR

Further to the announcement on 12 March 2018 pursuant to Rule 2.7 of the Takeover Code regarding the terms of a recommended Combination of Stellar with NWF, pursuant to which NWF will acquire the entire issued and to be issued ordinary share capital of Stellar in exchange for New NWF Shares, implemented by means of a Court-sanctioned scheme of arrangement of Stellar under Part 26 of the Companies Act, the Stellar Directors are pleased to confirm that the Scheme Circular will be posted to Stellar Shareholders later today. Capitalised terms used in this announcement have the same meaning as in the Scheme Circular.

In order for it to become effective and as described in the Scheme Circular, in addition to requiring the sanction of the Court, the Scheme requires the approval of Scheme Shareholders at the Court Meeting and at the General Meeting. Notices convening the Court Meeting and the General Meeting to be held on 19 April 2018 at 10.00 a.m. and 10.15 a.m., respectively, at the offices of Gowling WLG at 4 More London Riverside, London, SE1 2AU United Kingdom, accompany the Scheme Circular.

SUMMARY OF THE TERMS OF THE COMBINATION

Under the terms of the Combination, each Stellar Shareholder will be entitled to receive:

for each Stellar Share: 0.7622 of a New NWF Share ("Scheme Ratio")

EXPECTED TIMETABLE OF PRINCIPAL EVENTS

Subject to the approval of the Scheme Shareholders, the sanction of the Court and the satisfaction or waiver of the other conditions to which the Scheme is subject, it is expected the Scheme will become effective in on 26 April 2018. The expected timetable of principal events for the implementation of the Combination is set out below.

The following indicative timetable sets out expected dates for the implementation of the Scheme. If any of the dates and/or times in this expected timetable change, the revised dates and/or times will be notified to Stellar Shareholders by announcement through a Regulatory Information Service.

All times referred to in this announcement are to London time unless otherwise stated. 

Enquiries:

Important notices

Cairn Financial Advisers LLP, which is authorised and regulated by the Financial Conduct Authority, is acting for Stellar as financial adviser in relation to the Combination and is not acting for any other person in relation to the Combination. Cairn Financial Advisers LLP will not be responsible to anyone other than Company for providing the protections afforded to its clients or for providing advice in relation to the contents of this document or any offer for Stellar or arrangement referred to herein.

This announcement is for information purposes only and is not intended to, and does not, constitute or form part of any offer, invitation or the solicitation of an offer to purchase, otherwise acquire, subscribe for, sell or otherwise dispose of, any securities whether pursuant to this announcement or otherwise. This announcement does not constitute a prospectus or a prospectus equivalent document. The shareholders of Stellar and NWF are advised to read carefully the formal documentation in relation to the Combination once it has been despatched.

No person has been authorised to make any representations on behalf of Stellar or NWF concerning the Scheme or the Combination which are inconsistent with the statements contained herein, and any such representations, if made, may not be relied upon as having been so authorised.

No person should construe the contents of this announcement as legal, financial or tax advice and any interested person should consult its own advisers in connection with such matters.

Overseas jurisdictions

The release, publication or distribution of this announcement in jurisdictions other than the United Kingdom may be restricted by law and therefore any persons who are subject to the laws of any jurisdiction other than the United Kingdom should inform themselves about, and observe any applicable requirements. Any failure to comply with the restrictions may constitute a violation of the securities laws of any such jurisdiction.

To the fullest extent permitted by applicable law, the companies and persons involved in the Combination disclaim any responsibility or liability for the violation of such restrictions by any person.

This announcement has been prepared for the purposes of complying with English law, Australian law to the extent applicable, and the Takeover Code and the information disclosed in this announcement 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 the United Kingdom.

Overseas Shareholders

The availability of the Combination and the New NWF Shares to Stellar Shareholders who are not resident in the United Kingdom may be affected by the laws of the relevant jurisdiction in which they are located or of which they are resident. Persons who are not resident in the United Kingdom should inform themselves of, and observe, any applicable requirements.

Unless otherwise determined by NWF or required by the Takeover Code, and permitted by applicable law and regulation, the Combination will not be made available, directly or indirectly, in, into or from a Restricted Jurisdiction where to do so would violate the laws in that jurisdiction and no person may vote in favour of the Combination by any means, instrumentality or form within a Restricted Jurisdiction or any other jurisdiction if to do so would constitute a violation of the laws of that jurisdiction. Accordingly, copies of this announcement and all documents relating to the Combination are not being, and must not be, directly or indirectly, mailed or otherwise forwarded, distributed or sent in, into or from a Restricted Jurisdiction where to do so would violate the laws of that jurisdiction, and persons receiving this announcement and all documents relating to the Combination (including custodians, nominees and trustees) must not mail or otherwise distribute or send them in, into or from such jurisdictions where to do so would violate the laws of that jurisdiction.

Further details in relation to overseas Stellar Shareholders are contained in the Scheme Circular.

The New NWF Shares have not been, and will not be, registered under the US Securities Act 1933, as amended (the "US Securities Act") or the securities laws of any state, district or other jurisdiction of the United States and the relevant clearances have not been, and will not be, obtained from the securities commission or similar regulatory authority. The Combination is not being made in any US state or other jurisdiction where it is not legally permitted to do so. Accordingly, such securities may not be, offered, sold, resold, delivered or distributed, directly or indirectly, in or into such jurisdictions or any other jurisdiction if to do so would constitute a violation of relevant laws of, or require registration thereof in, such jurisdiction (except pursuant to an exemption, if available, from any applicable registration or prospectus requirements or otherwise in compliance with all applicable laws).

 NWF and Stellar intend to rely on an exemption from the registration requirements of the US Securities Act provided by Section 3(a)(10) thereof in connection with the consummation of the Combination and the issuance of New NWF Shares. Stellar Shareholders (whether or not US persons) who are or will be affiliates (within the meaning of the US Securities Act) of Stellar or NWF prior to, or of NWF after, the Effective Date will be subject to certain US transfer restrictions relating to the New NWF Shares received pursuant to the Scheme. For the purposes of qualifying for the exemption from the registration requirements of the US Securities Act afforded by Section 3(a)(10), Stellar will advise the Court that its sanctioning of the Scheme will be relied upon by NWF as an approval of the Scheme following a hearing on its fairness to Stellar Shareholders.

US shareholders should note that the Combination is made for the securities of an English company in accordance with the laws of England and Wales and the AIM Rules for Companies published by the London Stock Exchange. The Combination is subject to disclosure requirements of England and Wales that are different from those of the United States.

The receipt of New NWF Shares pursuant to the Combination by a US Stellar Shareholder may be a taxable transaction for US federal income tax purposes and under applicable state and local, as well as foreign and other, tax laws. Each Stellar Shareholder is urged to consult his independent professional adviser immediately regarding the tax consequences of the Combination.

It may be difficult for you to enforce your rights and any claim you may have arising under US federal securities laws, since NWF is located in Australia and most of its officers and directors are residents of Australia. You may not be able to sue NWF or its officers or directors in Australia for violations of the US securities laws. It may be difficult to compel NWF and its affiliates to subject themselves to a US court's judgment. 

You should be aware that NWF may purchase securities otherwise than under the Combination, such as in open market or privately negotiated purchases.

None of the securities referred to in this announcement have been approved or disapproved by the SEC, any state securities commission in the United States or any other US regulatory authority, nor have such authorities passed upon or determined the adequacy or accuracy of the information contained in this announcement. Any representation to the contrary is a criminal offence in the United States.

Notes regarding New NWF Shares

The New NWF Shares to be issued pursuant to the Combination will not be registered under the relevant securities laws of Japan or the Republic of South Africa and the relevant clearances have not been, and will not be, obtained from the securities commission or similar regulatory authority of any province or territory of Canada. Accordingly the New NWF Shares may not be, offered, sold, resold, delivered or distributed, directly or indirectly in or into Canada, Japan or the Republic of South Africa or any other jurisdiction if to do so would constitute a violation of relevant laws of, or require registration thereof in, such jurisdiction (except pursuant to an exemption, if available, from any applicable registration or prospectus requirements or otherwise in compliance with all applicable laws).

The offer of New NWF Shares for issue or sale or resale within Australia is prohibited unless a disclosure document has been lodged with the ASIC, or an exemption applies. New NWF Shares will be issued in reliance on exemptions in ASIC Legislative Instrument 2015/358 as the Combination will be made under a foreign compromise or arrangement that is made in accordance with laws in force in the United Kingdom, being an eligible foreign country.

This document is not a disclosure document for the purposes of Chapter 6D of the Australian Corporations Act 2001 (Cth) and does not purport to include the information required of a disclosure document under Chapter 6D of the Australian Corporations Act 2001 (Cth). It has not been approved by any Australian regulatory authority, such as ASIC or ASX and has not been lodged with ASIC. You are advised to exercise caution in relation to the proposal set out in this document. You should obtain independent professional advice if you have any queries or concerns about any of the contents or subject matter of this document.

Dealing disclosure requirements of the Takeover Code (the "Code")

Under Rule 8.3(a) of the Code, any person who is interested in 1% or more of any class of relevant securities of an offeree company or of any paper 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) of the Code 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% 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 exchanger 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, 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 Takeover 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.

Rule 2.9 disclosure

In accordance with Rule 2.9 of the Code, Stellar confirms that, as at the date of this announcement, it has in issue 62,007,748 ordinary shares of 1 pence nominal value each. The International Securities Identification Number (ISIN) of the Stellar Shares is GB00BYZ5QT80.

In addition to the issued ordinary share capital of Stellar, currently rights over 111,882,669 Stellar Shares have been granted as follows:

1The rights held by Stellar Warrant Holders includes warrants over 92,220,553 Stellar Shares which are associated with the Stellar CLNs. The number of these CLN Warrants has been calculated based on the aggregate exercise price of the CLN Warrants of US$2.475 million and US$1.34 million with the exercise price being assumed to be, for the purpose of the Combination, 5 pence per share and using an exchange rate of US$1.41 to £1.00. The CLN Warrant exercise price may vary in accordance with the terms of the Stellar CLNs (which are summarised in Stellar's previous announcements, notably the announcements of 14 August 2017 and 11 September 2017) in the event that the Combination does not proceed. CLN Warrants in respect of 227,719 Stellar Shares are exercisable at a price of 7.125 pence.

2 Pursuant to an agreement entered into with Stellar on 6 October 2016 (as subsequently amended) whereby Deutsche Balaton AG conditionally agreed to waive certain of its rights under its Stellar CLN relating to its ability to convert/and or exercise its Stellar CLN and CLN Warrants respectively into shares in a subsidiary of Stellar.

In addition, Stellar CLNs of US$2.99 million have been issued of which US$1.65 million have a maturity date of 31 March 2018 and US$1.34 million have a maturity date of 5 June 2018.

In accordance with Rule 2.9 of the Code, NWF confirms that, as at the date of this announcement, it has in issue 270,583,335 NWF Shares. For the avoidance of doubt, this figure does not take into account the NWF Rights Issue Shares or the NWF Conditional Placement Shares. Australian incorporated companies do not have authorised capital or par value for shares. The International Securities Identification Number (ISIN) of the NWF Shares is AU000000NWF9. In addition, NWF has a total of 6 million options on issue. These options are unquoted, and exercisable at A$0.50 each on or before 30 December 2020.

Publication on Website

A copy of this announcement will be made available (subject to certain restrictions relating to persons resident in restricted jurisdictions) at www.Stellar-diamonds.com in accordance with Rule 26.1 of the Code by no later than 12 noon (London time) on 27 March 2018. The content of the website referred to in this announcement is not incorporated into and does not form part of this announcement.

A notice informing Stellar Shareholders (other than Stellar Shareholders who have elected to receive electronic communications) that this announcement is available at www.stellar-diamonds.com/potential-offer-newfield will be posted in the near future. Stellar Shareholders may request a hard copy of this document by contacting Karl Smithson during business hours on +44 (0) 207 164 6371 or by submitting a request in writing to 40 Bloomsbury Way, London, WC1A 2SE or by email to karl.smithson@stellar-diamonds.com. Stellar Shareholders may also request that all future documents, announcements and information to be sent to them in relation to the Combination should be in hard copy form. Hard copies of this announcement will not be sent to you by Stellar unless so requested.

Electronic communications

Please be aware that addresses, electronic addresses and certain information provided by Stellar Shareholders, persons with information rights and other relevant persons for the receipt of communications from Stellar may be provided to NWF during the Offer Period if requested under Section 4 of Appendix 4 of the Takeover Code to comply with Rule 2.11(c) of the Takeover Code.