Severn Trent Regulatory News (SVT)

THIS ANNOUNCEMENT IS RESTRICTED AND IS NOT FOR PUBLICATION, RELEASE OR DISTRIBUTION, DIRECTLY OR INDIRECTLY, IN WHOLE OR IN PART, IN OR INTO THE UNITED STATES, AUSTRALIA, CANADA, THE REPUBLIC OF SOUTH AFRICA, JAPAN OR ANY OTHER JURISDICTION IN WHICH SUCH PUBLICATION, RELEASE OR DISTRIBUTION WOULD BE UNLAWFUL.

THIS ANNOUNCEMENT IS FOR INFORMATIONAL PURPOSES ONLY, AND DOES NOT CONSTITUTE OR FORM PART OF ANY OFFER OR INVITATION TO SELL OR ISSUE, OR ANY SOLICITATION OF AN OFFER TO PURCHASE OR SUBSCRIBE FOR, ANY SECURITIES OF SEVERN TRENT PLC.

THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION.

THIS ANNOUNCEMENT AMOUNTS TO A FINANCIAL PROMOTION FOR THE PURPOSES OF SECTION 21 OF THE FINANCIAL SERVICES AND MARKETS ACT 2000 ("FSMA") AND HAS BEEN APPROVED BY PRIMARYBID LIMITED WHICH IS AUTHORISED AND REGULATED BY THE FINANCIAL CONDUCT AUTHORITY (FRN 779021)

19 May 2021

Severn Trent Plc

("Severn Trent", the "Company" or the "Group")

Retail Offer via PrimaryBid

Retail Offer

Severn Trent is pleased to announce a retail offer via PrimaryBid of new ordinary shares (the "Retail Offer Shares") of 9717/19 pence each in the capital of the Company (the "Retail Offer").

As separately announced today, the Company is conducting a non-pre-emptive placing of new ordinary shares (the "Placing Shares") of 9717/19 pence each in the capital of the Company (the "Placing") through an accelerated bookbuilding process (the "Bookbuild"). The price at which the Placing Shares are to be placed (the "Placing Price") will be determined at the close of the Bookbuild. In addition, certain members of the Board and the Executive Management Team of the Company intend to subscribe for new ordinary shares (the "Subscription Shares") of 9717/19 pence each in the capital of the Company alongside the Placing (the "Subscription").

The issue price for the Retail Offer Shares, as well as for the Subscription Shares, will be equal to the Placing Price.

Rationale for the Retail Offer and Use of Proceeds

On 31 January 2021, Severn Trent submitted proposals, which if approved, would enhance the natural environment whilst creating jobs in the Midlands and drive long-term sustainable benefits for customers and communities in the Severn Trent region. Following its review process, Ofwat has endorsed all six projects and announced on 17 May 2021 an award to Severn Trent of £624 million1 (the "Green Recovery Award").

The proceeds of the Placing, Retail Offer, and Subscription will be used to fund the six projects under the Green Recovery Award (the "Projects"). Collectively the Projects support the wider national agenda on climate change and the need for greater water supply security. They will support long-term growth through decarbonising the supply of water, accelerating environmental improvements in the Severn Trent region, creating bathing quality rivers, replacing lead supply pipes, building a sustainable flood-resilient community, and installing smart meters for customers. In aggregate, the Projects represent a significant incremental investment opportunity over the next four years and importantly will supplement the work Severn Trent does now in its region, providing employment, resilience and an improved natural environment.

The Projects will drive RCV growth significantly ahead of previous expectations, on which the Company will earn a future return, whilst maintaining its current capital structure.

The proposed issue and allotment of the Placing Shares, Retail Offer Shares, and Subscription Shares is within the existing shareholder authorities granted to the Company at its Annual General Meeting held on 15 July 2020.

The Board's belief is that the Placing, Retail Offer, and Subscription are in the best interests of shareholders and the Company's wider stakeholders.

A presentation has been made available on the Company's website which contains further information relevant to the Placing.

1 Quoted in nominal prices. Equivalent to approximately £565 million in 2017/18 prices.

Details of the Retail Offer

The Company values its retail investor base and as a result the Retail Offer will give retail investors the opportunity to participate in the Company's equity fundraising alongside the Placing and the Subscription.

The Retail Offer will be open to retail investors immediately following release of this announcement who can apply exclusively through the PrimaryBid mobile app available on the Apple App Store and Google Play. PrimaryBid does not charge investors any commission for this service.

The Retail Offer will close at the same time as the Bookbuild Process is completed. The Retail Offer may close early if it is oversubscribed.

The Company reserves the right to scale back any order at its discretion. The Company and PrimaryBid reserve the right to reject any application for subscription under the Retail Offer without giving any reason for such rejection.

The Retail Offer is offered under the exemptions against the need for a prospectus allowed under the Prospectus Rules. As such, there is no need for publication of a prospectus pursuant to the Prospectus Rules, or for approval of the same by the Financial Conduct Authority in its capacity as the UK Listing Authority. The Retail Offer is not being made into any jurisdiction where it would be unlawful to do so. In particular, the Retail Offer is being made only to persons who are, and at the time the Retail Offer Shares are subscribed for, will be outside the United States and subscribing for the Retail Offer Shares in an "offshore transaction" as defined in, and in accordance with, Regulation S ("Regulation S") under the U.S. Securities Act of 1933, as amended (the "Securities Act"). Persons who are resident or otherwise located in the United States will not be eligible to register for participation in the Retail Offer through PrimaryBid or subscribe for Retail Offer Shares.

The Retail Offer Shares, when issued, will be fully paid and will rank pari passu in all respects with each other and with the existing ordinary shares of 9717/19 pence each in the capital of the Company, including, without limitation, the right to receive all dividends and other distributions declared, made or paid after the date of issue.

Applications will be made (i) to the Financial Conduct Authority for admission of the Retail Offer Shares to the premium listing segment of the Official List; and (ii) to the London Stock Exchange for admission of the Retail Offer Shares to trading on its main market for listed securities (together, "Admission").

Settlement for the Retail Offer Shares and Admission are expected to take place on or before 8:00am on 21 May 2021. The Retail Offer is conditional upon Admission becoming effective and on the placing agreement entered into by the Company not being terminated in accordance with its terms prior to Admission.

No commission is charged to investors on applications to participate in the Retail Offer made through PrimaryBid. It is vital to note that once an application for Retail Offer Shares has been made and accepted via PrimaryBid, an application cannot be withdrawn.

There is a minimum subscription of £100 per investor under the terms of the Retail Offer which is open to existing shareholders and other investors subscribing via the PrimaryBid mobile app.

For further details please refer to the PrimaryBid website at www.PrimaryBid.com or email PrimaryBid at enquiries@primarybid.com. The terms and conditions on which the Retail Offer is made, including the procedure for application and payment for Retail Offer Shares, is available to all persons who register with PrimaryBid.

It should be noted that a subscription for Retail Offer Shares and any investment in the Company carries a number of risks. Investors should make their own investigations into the merits of an investment in the Company. Nothing in this Announcement amounts to a recommendation to invest in the Company or amounts to investment, taxation or legal advice. Investors should take independent advice from a person experienced in advising on investment in securities such as the Retail Offer Shares if they are in any doubt.

This Announcement should be read in its entirety. In particular, the information provided in the "Important Notices" section of this Announcement should be read and understood.

Important Notices

This Announcement has been issued by and is the sole responsibility of the Company.

Persons distributing this Announcement must satisfy themselves that is lawful to do so. This Announcement is for information purposes only and shall not constitute an offer to sell or issue or the solicitation of an offer to buy, subscribe for or otherwise acquire securities in any jurisdiction in which any such offer or solicitation would be unlawful. Any failure to comply with this restriction may constitute a violation of the securities laws of such jurisdictions. Persons needing advice should consult an independent financial adviser.

The distribution of this Announcement and the offering, placing and/or issue of the Retail Offer Shares in certain jurisdictions may be restricted by law. No action has been taken by the Company or any of its affiliates, agents, directors, officers or employees that that would permit an offer of the Retail Offer Shares or possession or distribution of this Announcement or any other offering or publicity material relating to such Retail Offer Shares in any jurisdiction where action for that purpose is required. Persons into whose possession this announcement comes are required by the Company to inform themselves about and to observe any such restrictions.

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 THE UNITED STATES OF AMERICA, ITS TERRITORIES AND POSSESSIONS, ANY STATE OF THE UNITED STATES OR THE DISTRICT OF COLUMBIA (COLLECTIVELY, THE "UNITED STATES"), AUSTRALIA, CANADA, THE REPUBLIC OF SOUTH AFRICA, JAPAN OR JERSEY OR ANY OTHER JURISDICTION IN WHICH SUCH PUBLICATION, RELEASE OR DISTRIBUTION WOULD BE UNLAWFUL. FURTHER, THIS ANNOUNCEMENT IS FOR INFORMATION PURPOSES ONLY AND IS NOT AN OFFER OF SECURITIES IN ANY JURISDICTION. THIS ANNOUNCEMENT HAS NOT BEEN APPROVED BY THE LONDON STOCK EXCHANGE, NOR IS IT INTENDED THAT IT WILL BE SO APPROVED.

This Announcement or any part of it does not constitute or form part of any offer to issue or sell, or the solicitation of an offer to acquire, purchase or subscribe for, any securities in the United States, Canada, Australia, the Republic of South Africa, Japan or any other jurisdiction in which the same would be unlawful. No public offering of the securities referred to herein is being made in any such jurisdiction.

This communication is not a public offer of securities for sale in the United States. The securities referred to herein have not been and will not be registered under the Securities Act or under the securities laws of any state or other jurisdiction of the United States, and may not be offered or sold directly or indirectly in or into the United States except pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act and in compliance with the securities laws of any state or any other jurisdiction of the United States. 

Certain statements contained in this Announcement constitute "forward-looking statements" with respect to the financial condition, performance, strategic initiatives, objectives, results of operations and business of the Company. All statements other than statements of historical facts included in this Announcement are, or may be deemed to be, forward-looking statements. Without limitation, any statements preceded or followed by or that include the words "targets", "plans", "believes", "expects", "aims", "intends", "anticipates", "estimates", "projects", "will", "may", "would", "could" or "should", or words or terms of similar substance or the negative thereof, are forward-looking statements. Forward-looking statements include statements relating to the following: (i) future capital expenditures, expenses, revenues, earnings, synergies, economic performance, indebtedness, financial condition, dividend policy, losses and future prospects; and (ii) business and management strategies and the expansion and growth of the Company's operations. Such forward-looking statements involve risks and uncertainties that could significantly affect expected results and are based on certain key assumptions. Many factors could cause actual results, performance or achievements to differ materially from those projected or implied in any forward-looking statements. The important factors that could cause the Company's actual results, performance or achievements to differ materially from those in the forward-looking statements include, among others, the macroeconomic and other impacts of COVID-19, economic and business cycles, the terms and conditions of the Company's financing arrangements, foreign currency rate fluctuations, competition in the Company's principal markets, acquisitions or disposals of businesses or assets and trends in the Company's principal industries. Due to such uncertainties and risks, readers are cautioned not to place undue reliance on such forward-looking statements, which speak only as of the date hereof. In light of these risks, uncertainties and assumptions, the events described in the forward-looking statements in this Announcement may not occur. The forward-looking statements contained in this Announcement speak only as of the date of this Announcement. The Company and its directors each expressly disclaim any obligation or undertaking to update or revise publicly any forward-looking statements, whether as a result of new information, future events or otherwise, unless required to do so by applicable law or regulation, the Listing Rules, the Market Abuse Regulation, the Disclosure Guidance and Transparency Rules, the rules of the London Stock Exchange or the FCA.

Any indication in this Announcement of the price at which ordinary shares of 9717/19 pence each in the capital of the Company have been bought or sold in the past cannot be relied upon as a guide to future performance. No statement in this Announcement is intended as a profit forecast or estimate for any period and no statement in this Announcement should be interpreted to mean that earnings, earnings per share or income, cash flow from operations or free cash flow for the Company, as appropriate, for the current or future years would necessarily match or exceed the historical published earnings, earnings per share or income, cash flow from operations or free cash flow for the Company.

Neither the content of the Company's website (or any other website) nor the content of any website accessible from hyperlinks on the Company's website (or any other website) is incorporated into or forms part of this Announcement. The Retail Offer Shares to be issued or sold pursuant to the Retail Offer will not be admitted to trading on any stock exchange other than the London Stock Exchange.