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Response to announcement by DP Eurasia

Wed, 27th Oct 2021 17:56

RNS Number : 4846Q
Jubilant Foodworks Netherlands B.V.
27 October 2021


27 October 2021

Response to announcement by DP Eurasia

Jubilant Foodworks Netherlands B.V. (the "Purchaser"), a wholly owned subsidiary of Jubilant Foodworks Limited ("Jubilant Foodworks"), notes the announcement earlier today by DP Eurasia N.V. ("DP Eurasia") recommends shareholders not to tender their shares through the reverse bookbuild ("RBB") announced on 30 September 2021.

Jubilant Foodworks notes that DP Eurasia's announcement states that the RBB should be appraised as a change of control transaction on the basis of the influence Jubilant Foodworks would be able to exert through the increase in its shareholding, its board representation and an intention to treat DP Eurasia as a consolidated subsidiary. Jubilant Foodworks however reminds shareholders that the RBB only involves the purchase of up to 49.99% of the issued share capital of DP Eurasia, the relationship agreement entered into between the Purchaser's direct subsidiary, Fides Food Systems Coöperatief U.A. and DP Eurasia on 28 June 2017 (and amended on 29 September 2021) regulates their relationship (including with respect to matters of independence) and remains in place subject to its terms, and Jubilant Foodworks' board representation also remains the same following the RBB as again determined by the relationship agreement. Furthermore, Jubilant Foodworks' previously stated intention to consolidate its investment in DP Eurasia into its own accounts will be guided by accounting principles. The appraisal also appears to take account of a number of principles and considerations from the UK and/or Dutch takeover regimes, neither of which have applied to DP Eurasia since the end of last year.

Jubilant Foodworks continues to believe that the offer price of 95 pence per share ("Offer Price") offers shareholders an attractive opportunity to realise some or all of their holdings at a substantial premium to the share price prior to the announcement of the RBB.

Specifically, the Offer Price represents a substantial premium to all recent price metrics:

· 17.1 per cent. to the volume weighted average price of 81.1 pence per ordinary share over the 4 weeks to 29 September 2021;

· 25.2 per cent. to the volume weighted average price of 75.9 pence per ordinary share over the 3 months to 29 September 2021;

· 31.8 per cent. to the volume weighted average price of 72.1 pence per ordinary share over the 6 months to 29 September 2021;

· 68.7 per cent. to the volume weighted average price of 56.3 pence per ordinary share over the 12 months to 29 September 2021.

Jubilant Foodworks also notes that the Turkish lira, DP Eurasia's reporting currency has fallen in value by 31 per cent. against the British pound in 2021 and 10 per cent. since announcement of the RBB on 30 September 2021, continuing the trend of a weakening currency in recent years. Jubilant Foodworks notes that DP Eurasia's British pound equivalent financial performance has been adversely impacted by the weakening of the Turkish lira against major currencies and reported growth rates have been favourably impacted by Turkish lira being the operating currency. Whilst DP Eurasia's reported system sales increased by 13% in 2019 and 15% in 2020, the British pound sterling equivalent growth was 0% and -8% respectively based on the yearly average foreign exchange rate. Continued depreciation in the value of the Turkish lira would be likely to impact DP Eurasia's reported financial performance in the short to medium term. Jubilant Foodworks continues to consider its investment in DP Eurasia to be a strategic long term investment.

The RBB remains open until 4.30 p.m. on 29 October 2021. Shareholders who are Relevant Persons and wish to take part should contact Peel Hunt on the telephone number below.

Capitalised terms used but not defined in this announcement shall have the meanings given to them in the reverse bookbuild announcement published on 30 September 2021.


Jubilant Foodworks

Ashish Goenka


Peel Hunt (Financial Adviser and Bookrunner)

+44 (0) 20 7418 8900

Miles Cox

Oliver Jackson

Adrian Trimmings

Sohail Akbar (ECM)


About Jubilant Foodworks

Jubilant Foodworks Limited (JFL/Company) is part of Jubilant Bhartia group and is India's largest foodservice Company. Its Domino's Pizza franchise extends across a network of 1,435 restaurants in 307 cities. The Company has the exclusive rights to develop and operate Domino's Pizza brand in India, Sri Lanka, Bangladesh and Nepal. At present, it operates in India, and through its subsidiary companies in Sri Lanka and Bangladesh. The Company also enjoys exclusive rights to develop and operate Dunkin' restaurants in India, has in operation 28 restaurants across 8 cities in India. JFL has ventured into Chinese cuisine segment with its first owned restaurant brand, 'Hong's Kitchen', which now has 13 restaurants across 3 cities. Recently, the Company has added Indian cuisine of biryani, kebabs, breads and more to the portfolio by launching Ekdum! which now has 8 restaurants across 3 cities. The Company has exclusive rights to develop and operate Popeyes® restaurants in India, Bangladesh, Nepal and Bhutan. In accordance with shifting consumption habits, the Company has forayed into the ready-to-cook segment with 'ChefBoss'. 

Important Notices

This announcement and the information contained herein is not for release, publication or distribution, in whole or in part, directly or indirectly, in, into or from any jurisdiction where to do so would constitute a violation of the relevant laws or regulations of such jurisdiction. This announcement is for information purposes only and the information contained herein does not constitute or form part of an offer to buy, sell, issue, acquire or subscribe for, or the solicitation of an offer to buy, sell, issue, acquire or subscribe for, any securities in any jurisdiction where it would be unlawful to do so. Any failure to comply with these restrictions may constitute a violation of the securities laws of such jurisdictions.

The distribution of this announcement may be restricted by law in certain jurisdictions and persons into whose possession any document or other information referred to herein comes should inform themselves about and observe any such restriction.

The RBB is not being directed, directly or indirectly, to DP Eurasia investors in any jurisdiction where to do so would be unlawful.

In the EEA and the United Kingdom, this announcement is only directed at (and is only being distributed to) persons whose ordinary activities involve them in acquiring, holding, managing and disposing of investments (as principal or agent) for the purposes of their business and who have professional experience in matters relating to investments and are: (a) if in a member state of the European Economic Area (the "EEA"), persons who are qualified investors, within the meaning of Article 2(E) of the Prospectus Regulation (Regulation (EU) 2017/1129 of the European Parliament and of the Council); or (b) if in the United Kingdom, 'Qualified Investors' within the meaning of Article 2(E) of the UK Prospectus Regulation (Regulation (EU) (2017/1129) as it forms part of UK domestic law by virtue of the European Union Withdrawal Act 2018) and who are also: (i) persons who fall within the definition of "investment professionals" in Article 19(5) of the Financial Services And Markets Act 2000 (Financial Promotion) Order 2005, as amended (the "Order"), or (ii) high net worth bodies corporate, unincorporated associations and partnerships and trustees of high value trusts as described in Article 49(2) of the order, or (c) other persons to whom it may otherwise be lawfully communicated, and in all cases who are capable of being categorised as a professional client or an eligible counterparty for the purposes of the FCA conduct of business rules who are permitted to sell or dispose of securities in the RBB pursuant to applicable legislation (all such persons referred to in (a), (b) and (c) above together being referred to as "Relevant Persons").

Any investment or investment activity to which this announcement relates is available in the EEA or the United Kingdom only to Relevant Persons and will be engaged in only with Relevant Persons. This announcement must not be acted on or relied on by persons in the EEA or the United Kingdom who are not Relevant Persons.

The RBB relates to securities of a non-U.S. company that is subject to the disclosure requirements, rules and practices applicable to companies listed in the UK, which differ from those of the United States in certain material respects. The RBB will be made in the United States in accordance with other requirements of Regulation 14E under the US Securities Exchange Act of 1934, as amended (the "Exchange Act") to the extent applicable. US shareholders should note that the ordinary shares of DP Eurasia are not listed on a US securities exchange and DP Eurasia is not subject to the periodic reporting requirements of the Exchange Act and is not required to, and does not, file any reports with the US Securities and Exchange Commission (the "SEC") thereunder.

Neither the SEC nor any US state securities commission has approved or disapproved of this transaction or passed upon the merits of fairness of such transaction or passed upon the adequacy of the information contained in this announcement. Any representation to the contrary is a criminal offence in the United States.

The securities in the RBB have not been offered or sold and will not be offered or sold in Hong Kong, by means of any document, other than (a) being solicited or purchased from "professional investors" as defined in the Securities and Futures Ordinance (Cap. 571 of the Laws of Hong Kong) (the "SFO") and any rules made thereunder; or (b) in other circumstances which do not result in the document being a "prospectus" as defined in the Companies (Winding Up and Miscellaneous Provisions) Ordinance (Cap. 32 of the Laws of Hong Kong) or which do not constitute an offer to the public within the meaning of that ordinance. No advertisement, invitation or document relating to the RBB has been or may be issued or has been or may be in the possession of any person for the purposes of issue, whether in Hong Kong or elsewhere, which is directed at, or the contents of which are likely to be accessed or read by, the public in Hong Kong (except if permitted to do so under the securities laws of Hong Kong) other than with respect to the securities in the RBB which are or are intended to be disposed of only to persons outside Hong Kong or only to "professional investors" in Hong Kong as defined in the SFO and any rules made thereunder.

This announcement does not constitute a public offer in the Cayman Islands by either Jubilant Foodworks or Peel Hunt (on behalf of Jubilant Foodworks) to purchase the DP Eurasia ordinary shares and any invitation to participate in the RBB is not being conducted from a place of business in the Cayman Islands.

No advertisement, invitation or public announcement relating to the RRB and no offer to purchase, sell, acquire or subscribe for securities, has been or will be, published or made to the public in The Bahamas. This advertisement is being circulated for informational purposes only, to certain accredited investors incorporated in The Bahamas who are existing shareholders in the Company and are designated or deemed to be "non-resident" for the purposes of the Exchange Control Regulations of The Bahamas.

Peel Hunt LLP, which is authorised and regulated in the United Kingdom by the FCA, is acting as financial adviser and sole bookrunner exclusively for Jubilant Foodworks and no one else in connection with the matters set out in this announcement and will not regard any other person as its client in relation to the matters set out in this announcement and will not be responsible to anyone other than Jubilant Foodworks for providing the protections afforded to clients of Peel Hunt LLP, nor for providing advice in relation to the contents of this announcement or any other matter referred to herein. Neither Peel Hunt LLP nor any of its subsidiaries, branches or 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 Peel Hunt LLP in connection with this announcement, any statement contained herein or otherwise or any transaction, arrangement or other matter referred to herein (including, without limitation, the RBB).

Neither Peel Hunt nor any of its affiliates nor any of their respective directors, officers, employees, advisers or agents accepts any responsibility or liability whatsoever for, or makes any representation or warranty, express or implied, as to, the truth, accuracy or completeness of the information in this announcement (or whether any information has been omitted from the announcement) or any other information relating to Jubilant Foodworks or the Company or any of its or their subsidiaries or associated companies, whether written, oral or in a visual or electronic form, and howsoever transmitted or made available or for any loss howsoever arising from any use of this announcement or its contents or otherwise arising in connection therewith.

This announcement, including information included or incorporated by reference in this announcement, may include statements that are, or may be deemed to be, "forward-looking statements". These forward-looking statements may be identified by the use of forward-looking terminology, including the terms "targets", "believes", "estimates", "plans", "projects", "anticipates", "expects", "intends", "may", "will" or "should" or, in each case, their negative or other variations or comparable terminology, or by discussions of strategy, plans, objectives, goals, future events or intentions. These forward-looking statements include all matters that are not historical facts and involve predictions. Forward-looking statements may and often do differ materially from actual results. Any forward-looking statements reflect Jubilant Foodworks' current view with respect to future events and are subject to risks relating to future events and other risks, uncertainties and assumptions relating to DP Eurasia's business, results of operations, financial position, liquidity, prospects, growth or strategies and the industry in which it operates. Forward-looking statements speak only as of the date they are made and cannot be relied upon as a guide to future performance. There are many factors that could cause actual results to differ materially from those expressed or implied in forward-looking statements. Among such factors are changes in the global, political, social, economic, business, competitive, market and regulatory forces, future exchange and interest rates, changes in tax rates, future business combinations or disposals, and any epidemic, pandemic or disease outbreak.

These forward-looking statements are based on numerous assumptions regarding the present and future business strategies of such persons and the environment in which each will operate in the future. By their nature, these forward-looking statements involve known and unknown risks and uncertainties because they relate to events and depend on circumstances that will occur in the future. The factors described in the context of such forward-looking statements in this announcement may cause the actual results, performance or achievements of any such person, or industry results and developments, to be materially different from any results, performance or achievements expressed or implied by such forward-looking statements. No assurance can be given that such expectations will prove to have been correct and persons reading this announcement are therefore cautioned not to place undue reliance on these forward-looking statements that speak only as at the date of this announcement. All subsequent oral or written forward-looking statements attributable to Jubilant Foodworks or its affiliates or any persons acting on its behalf are expressly qualified in their entirety by the cautionary statement above. Jubilant Foodworks does not intend, nor undertakes any obligation, to update publicly or revise forward-looking statements, whether as a result of new information, future events or otherwise, except to the extent legally required.

All times referred to are London, UK, time unless otherwise stated.

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