LUXEMBOURG/PORTUGAL--(BUSINESS WIRE)--
Société Anonyme
Registered Office: 21/25 Allée
Scheffer, L- 2520 Luxembourg
R.C.S. Luxembourg B 22.232
NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION TO ANY U.S. PERSON OR TO ANY PERSON LOCATED OR RESIDENT IN THE UNITED STATES OF AMERICA (SEE “OFFER AND DISTRIBUTION RESTRICTIONS” BELOW)
31 October 2011
ESPÍRITO SANTO FINANCIAL GROUP S.A. ANNOUNCES ITS EXCHANGE OFFER AND ESPÍRITO SANTO INTERNATIONAL S.A. ANNOUNCES ITS TENDER OFFER IN RESPECT OF THE OUTSTANDING
€400,000,000 SERIES A NON-CUMULATIVE GUARANTEED STEP-UP PREFERRED SECURITIES ISSUED BY ESFG INTERNATIONAL LIMITED AND HAVING THE BENEFIT OF A SUBORDINATED GUARANTEE OF ESFG
€400,000,000 6.875 PER CENT. SUBORDINATED NOTES DUE 2019 ISSUED BY ESPÍRITO SANTO FINANCIAL GROUP S.A.
Espírito Santo Financial Group S.A. (“ESFG”) announces today its invitation to Holders, (subject to the offer and distribution restrictions referred to below) of the €400,000,000 Series A Non-cumulative Guaranteed Step-Up Preferred Securities (ISIN: XS0303426661) issued by ESFG International Limited and having the benefit of a subordinated guarantee of ESFG (the “Preferred Securities”) and the €400,000,000 6.875 per cent. Subordinated Notes due 2019 (ISIN: XS0458566071) issued by ESFG (the “Subordinated Notes” and, together with the Preferred Securities, the “Existing Securities”) to offer to exchange up to €400,000,000 in aggregate liquidation preference/principal amount of such Existing Securities for ordinary shares of no par value of ESFG (the “New Shares”) in bearer form (ISIN: LU0011904405) (the “Exchange Offer”).
Espírito Santo International S.A. (“ESI”) also announces today its invitation to Holders (subject to the offer and distribution restrictions referred to below) of the Existing Securities to sell their Existing Securities for purchase by ESI for cash subject to a maximum cash purchase amount of €75,000,000 (the “Tender Offer” and, together with the Exchange Offer, the “Offers”).
The Offers are made on the terms and subject to the conditions set out in the Offer Memorandum dated 31 October 2011 (the “Offer Memorandum”).
A summary of certain of the terms of the Offers appears below:
|
Existing Securities |
ISIN/ Common Code |
Outstanding
Liquidation Preference/ |
Early Exchange Offer Consideration* | Late Exchange Offer Consideration* | New Shares Price | Number of New Shares to be delivered pursuant to Exchange Offer* | Tender Offer Consideration* | Exchange Offer Acceptance Cap | Tender Offer Acceptance Cap | ||||||||||
|
Preferred Securities |
XS0303426661/ 030342666 |
€400,000,000 | €730 | €700 | €10 | The relevant Exchange Offer Consideration divided by the New Shares Price | €420 |
€400,000,000 in liquidation preference/ principal amount of Existing Securities |
€75,000,000 cash amount |
||||||||||
| Subordinated Notes |
XS0458566071/ 045856607 |
€400,000,000 | €830 | €800 | €540 |
* per €1,000 of liquidation preference or principal amount of the Existing Securities, as applicable
Copies of the Offer Memorandum are available from the Exchange and Tender Agent as set out below. Capitalised terms used in this announcement but not defined have the meanings given to them in the Offer Memorandum.
Rationale for the Offers
The purpose of the Offers is to optimise ESFG’s capital management and, in particular, to strengthen ESFG’s core Tier I capital on a consolidated basis. ESFG will continue to explore ways to strengthen its Core Tier I capital and adopt measures in order to meet the Bank of Portugal’s new minimum levels of Core Tier I capital set at 9 per cent. by 31 December 2011. For further information about ESFG’s capital position, see the “New capital requirements” risk factor on page 17 of the New Shares Prospectus annexed to the Offer Memorandum.
Details of the Offers
Exchange Offer
A Holder whose Existing Securities are accepted for exchange pursuant to the Exchange Offer will receive, on the Exchange Offer Settlement Date an aggregate number of New Shares for each €1,000 in liquidation preference/principal amount of the relevant Existing Securities accepted for exchange equal to the relevant Exchange Offer Consideration divided by the New Shares Price of €10 per New Share. Holders who validly Offer to Exchange their Existing Securities on or prior to the Early Exchange Offer Deadline will receive the relevant Early Exchange Offer Consideration. Holders who validly Offer to Exchange their Existing Securities after the Early Exchange Offer Deadline but on or prior to the Exchange Offer Expiration Deadline will receive the relevant Late Exchange Offer Consideration. ESFG will also pay each such Holder, on the Exchange Offer Settlement Date, any Accrued Interest in cash.
ESFG will accept Offers to Exchange with respect to the Preferred Securities in priority to Offers to Exchange Subordinated Notes up to the Exchange Offer Acceptance Cap. If the aggregate liquidation preference/principal amount of Existing Securities which are Offered for Exchange exceeds the Exchange Offer Acceptance Cap, Offers to Exchange will be accepted on a pro rata basis. If the aggregate liquidation preference of the Preferred Securities accepted for exchange by ESFG exceeds the Exchange Offer Acceptance Cap, ESFG will not accept any Offers to Exchange the Subordinated Notes and will accept Offers to Exchange the Preferred Securities on a pro rata basis.
The New Shares, which are in bearer form, will be admitted to listing on the Official List of the Luxembourg Stock Exchange, NYSE Euronext Lisbon and the Official List maintained by the UK Listing Authority and to trading on the Regulated Market of the Luxembourg Stock Exchange, NYSE Euronext Lisbon's Regulated Market and on the London Stock Exchange's Regulated Market.
Tender Offer
A Holder whose Existing Securities are accepted for purchase pursuant to the Tender Offer will receive, on the Tender Offer Settlement Date, a cash amount equal to €420 for each €1,000 in liquidation preference of the Preferred Securities accepted for purchase and €540 for each €1,000 in principal amount of the Subordinated Notes accepted for purchase. ESI will also pay each such Holder, on the Tender Offer Settlement Date, any Accrued Interest in cash.
ESI will accept Offers to Tender with respect to the Preferred Securities in priority to Offers to Tender Subordinated Notes up to the Tender Offer Acceptance Cap. If the aggregate liquidation preference/principal amount of Existing Securities which are Offered for Tender exceeds the Tender Offer Acceptance Cap, Offers to Tender will be accepted on a pro rata basis. If the aggregate liquidation preference of the Preferred Securities accepted for purchase by ESI exceeds the Tender Offer Acceptance Cap, ESI will not accept any Offers to Tender the Subordinated Notes and will accept Offers to Tender the Preferred Securities on a pro rata basis.
Following settlement of the Tender Offer, ESI will submit into the Exchange Offer those Existing Securities which it purchases from Holders whose Offers to Tender are accepted pursuant to the Tender Offer.
Acceptance Caps and Scaling
Each of ESFG and ESI may only accept Offers to Exchange and Offers to Tender Existing Securities, as applicable, up to the relevant Acceptance Cap.
ESI reserves the right, in its sole and absolute discretion, to increase or decrease the Tender Offer Acceptance Cap at any time up to and including the announcement of the Tender Offer results, which amendment will be notified to Holders as soon as reasonably practicable. Any such amendment shall not permit Holders to revoke Tender Instructions which have been submitted to the Exchange and Tender Agent prior to the date of the announcement referred to above.
ESFG reserves the right, in its sole and absolute discretion, to increase or decrease the Exchange Offer Acceptance Cap at any time up to and including the announcement of the Exchange Offer results, which amendment will be notified to Holders as soon as reasonably practicable. Any such amendment shall not permit Holders to revoke Exchange Instructions which have been submitted to the Exchange and Tender Agent prior to the date of the announcement referred to above.
If the aggregate principal amount of the Existing Securities validly Offered for Exchange or Offered for Tender pursuant to the Offers is greater than the relevant Acceptance Cap, ESFG or ESI, as applicable, intends to accept the relevant series of Existing Securities which causes the relevant Acceptance Cap to be exceeded, on a pro rata basis, as fully described in the Offer Memorandum.
Indicative Timetable of Events
| Event | Dates and Times (All times are Luxembourg time) | |
| Commencement of the Offers | ||
|
Offers announced and notice of the Offers submitted to the Clearing
Systems and published via a Notifying News Service and the
Luxembourg Stock Exchange’s website.
Offer Memorandum available from the Exchange and Tender Agent. |
31 October 2011 | |
| Early Exchange Offer Deadline | ||
| Deadline for eligibility for payment of Early Exchange Offer Consideration. | 4.00 p.m., on 7 November 2011 | |
| Tender Offer Expiration Deadline | ||
|
Deadline for receipt by the Exchange and Tender Agent of valid
Tender Instructions in respect of the Tender Offer.
End of Tender Offer Period. |
4.00 p.m., on 8 November 2011 | |
| Announcement of Tender Offer Results | ||
| Announcement by ESI of the final acceptance amount and details of any scaling of Existing Securities that will be applied. | As soon as reasonably practicable after the Tender Offer Expiration Deadline | |
| Tender Offer Settlement Date | ||
| Expected settlement date for the Tender Offer | 10 November 2011 | |
| Exchange Offer Expiration Deadline | ||
|
Deadline for receipt by the Exchange and Tender Agent of valid
Exchange Instructions in respect of the Exchange Offer and
eligibility for payment of Late Exchange Offer Consideration.
End of Exchange Offer Period. |
4.00 p.m., on 14 November 2011 | |
| Announcement of Exchange Offer Results | ||
| Announcement by ESFG of the final acceptance amount and details of any scaling of Existing Securities that will be applied. | As soon as reasonably practicable after the Exchange Offer Expiration Deadline | |
| Exchange Offer Settlement Date | ||
| Expected settlement date for the Exchange Offer | 21 November 2011 | |
| Admission Date | ||
| Expected date of Admission of the New Shares. |
21 November 2011 on the Luxembourg Stock Exchange
On or shortly after 22 November 2011 on the NYSE Euronext Lisbon and the London Stock Exchange |
|
Holders should check with the bank, securities broker, relevant Clearing System or any other Intermediary through which they hold their Existing Securities whether such Intermediary will apply different deadlines for any of the events specified above, and then to allow for such deadlines if such deadlines are prior to the deadlines set out above.
Unless stated otherwise, announcements will be made by ESFG and ESI (i) by the issue of a press release to a Notifying News Service, (ii) by the delivery of notices to the Clearing Systems for communication to Direct Participants, and (iii) on the Luxembourg Stock Exchange’s website. Significant delays may be experienced in publishing notices through the Clearing Systems. Holders are urged to contact the Dealer Managers or the Exchange and Tender Agent using the contact details below for the relevant announcements during the relevant Offer Period. All announcements will be made available upon release at the offices of the Dealer Managers and the Exchange and Tender Agent.
Holders are advised to read carefully the Offer Memorandum for full details of and information on the procedures for participating in the Offers.
Banco Espírito Santo de Investimento, S.A. and Nomura International plc are acting as Dealer Managers and Lucid Issuer Services Limited is acting as Exchange and Tender Agent.
Questions and requests for assistance in connection with the Offers may be directed to any Dealer Manager.
|
DEALER MANAGERS |
||
|
Banco Espírito Santo de Investimento, S.A.
Tel: +351 21 319 6904 |
Nomura International plc
Tel: +44 20 7103 5652 |
|
| Questions and requests for assistance in connection with the delivery of Exchange Instructions or Tender Instructions may be directed to the Exchange and Tender Agent. | ||
| EXCHANGE AND TENDER AGENT | ||
|
Lucid Issuer Services Limited
Tel: +44 20 7704 0880 |
||
DISCLAIMER
This announcement must be read in conjunction with the Offer Memorandum. This announcement and the Offer Memorandum contain important information which should be read carefully before any decision is made with respect to the Offers. If any Holder is in any doubt as to the contents of this announcement or the Offer Memorandum or the action it should take, it is recommended to seek its own financial and legal advice, including in respect of any tax consequences, immediately from its stockbroker, bank manager, solicitor, accountant or other independent financial or legal adviser. Any individual or company whose Existing Securities are held on its behalf by a broker, dealer, bank, custodian, trust company or other nominee or intermediary must contact such entity if it wishes to participate in the Offers. None of the Dealer Managers, the Exchange and Tender Agent, ESFG or ESI makes any recommendation as to whether Holders should offer Existing Securities for exchange pursuant to the Exchange Offer or for sale pursuant to the Tender Offer.
OFFER AND DISTRIBUTION RESTRICTIONS
Neither this announcement nor the Offer Memorandum constitutes an offer to sell or buy or the solicitation of an offer to sell or buy the Existing Securities and/or New Shares, as applicable, (and offers of Existing Securities for exchange and sale of Existing Securities for purchase pursuant to the Offers will not be accepted) from Holders in any circumstances in which such offer or solicitation is unlawful. In those jurisdictions where the securities, blue sky or other laws require an Offer to be made by a licensed broker or dealer and any of the Dealer Managers or any of their respective affiliates is such a licensed broker or dealer in any such jurisdiction, that Offer shall be deemed to be made by such Dealer Manager or affiliate, as the case may be, on behalf of ESFG or ESI, as the case may be, in such jurisdiction.
The distribution of this announcement and the Offer Memorandum in certain jurisdictions may be restricted by law. Persons into whose possession this announcement or the Offer Memorandum comes are required by each of ESFG, ESI, the Dealer Managers and the Exchange and Tender Agent to inform themselves about, and to observe, any such restrictions.
United States
The Offers are not being made, and will not be made, directly or indirectly, in or into, or by use of the mail of, or by any means or instrumentality of interstate or foreign commerce of or of any facilities of a national securities exchange of, the United States or to, or for the account or benefit of, U.S. persons. This includes, but is not limited to, facsimile transmission, electronic mail, telex, telephone and the internet. Accordingly, copies of this announcement and the Offer Memorandum and any other documents or materials relating to the Offers are not being, and must not be, directly or indirectly, mailed or otherwise transmitted, distributed or forwarded (including without limitation, by custodians, nominees or trustees) in or into the United States or to U.S. persons and the Existing Securities cannot be Offered for Exchange or Offered for Tender pursuant to the Offers by any such use, means, instruments or facilities or from within the United States or by U.S. persons. Any purported Offer to Exchange or Offer to Tender Existing Securities resulting directly or indirectly from a violation of these restrictions will be invalid, and any purported Offer to Exchange or Offer to Tender made by a U.S. person, a resident of the United States or from the United States or from any agent, fiduciary or other intermediary acting on a non-discretionary basis for a principal giving instructions from within the United States or for a U.S. person will be invalid and will not be accepted.
Neither the Offer Memorandum nor this announcement is an offer of securities for sale in the United States or to U.S. persons. The Existing Securities and the New Shares have not been, and will not be, registered under the Securities Act or the securities laws of any state or jurisdiction of the United States, and may not be offered, sold or delivered, directly or indirectly, in the United States or to, or for the account or benefit of, U.S. persons. The purpose of this Offer Memorandum is limited to the Offers, and this Offer Memorandum may not be sent or given to any person other than in an offshore transaction in accordance with Regulation S under the Securities Act.
Each Holder participating in an Offer will represent that it is participating in that Offer in accordance with Regulation S under the Securities Act and that it is not participating in that Offer from the United States nor is it a U.S. person or an agent, fiduciary or other intermediary acting on a non-discretionary basis for a principal giving instructions from within the United States or for a U.S. person.
European Economic Area
The invitation to participate in the Offers are being made in each Member State of the European Economic Area which has implemented the Prospectus Directive only to “qualified investors” (as defined in the Prospectus Directive).
Italy
None of the Offers, this announcement and the Offer Memorandum or any other documents or materials relating to the Offers have been or will be submitted to the clearance procedure of the Commissione Nazionale per le Società e la Borsa (CONSOB) pursuant to Italian laws and regulations, and therefore the Offers may only be made or promoted, directly or indirectly, in or into the Republic of Italy pursuant to an exemption from the rules governing public purchases or exchange offers (offerte pubbliche di acquisto o scambio) as defined in article 1, paragraph 1, letter v of the Italian Legislative Decree no. 58 of February 24, 1998, as amended (the “Financial Services Act”).
Accordingly, the Offers are not addressed to, and neither this announcement, the Offer Memorandum nor any other documents, materials or information relating, directly or indirectly, to the Offers can be distributed or otherwise made available (either directly or indirectly) to any person in Italy other than:
(i) to qualified investors (investitori qualificati) pursuant to article 34-ter, paragraph 1, letter (b), of CONSOB Regulation No. 11971 of 14 May 1999, as amended from time to time (the “CONSOB Regulation”) acting on their own account; or
(ii) in any other circumstances where an express exemption from compliance with the restrictions on public purchases or exchange offers applies pursuant to the Financial Services Act or the CONSOB Regulation.
Belgium
Neither this announcement, the Offer Memorandum nor any other documents or materials relating to the Offers have been submitted to or will be submitted for approval or recognition to the Financial Services and Markets Authority (“Autorité des services et marches financiers / Autoriteit financiële diensten en markten”) and, accordingly, the Offers may not be made in Belgium by way of a public offering, as defined in Articles 3 and 6 of the Belgian Law of 1 April 2007 on public takeover bids or as defined in Article 3 of the Belgian Law of 16 June 2006 on the public offer of placement instruments and the admission to trading of placement instruments on regulated markets, both as amended or replaced from time to time. Accordingly, the Offers may not be advertised and the Offers will not be extended, and neither this announcement, the Offer Memorandum nor any other memorandum, information circular, brochure or any similar documents, has been or shall be distributed or made available, directly or indirectly, to any person in Belgium other than “qualified investors” as defined in Article 10 of the Belgian Law of 16 June 2006 on the public offer of placement instruments and the admission to trading of placement instruments on regulated markets (as amended from time to time). This announcement and the Offer Memorandum has been issued only for the personal use of the above-mentioned qualified investors and exclusively for the purpose of the Offers. Accordingly, the information contained therein may not be used for any other purpose nor disclosed to any other person in Belgium.
France
The Offers are not being made, directly or indirectly, to the public in France. Neither this announcement, the Offer Memorandum nor any other documents or offering materials relating to the Offers have been or shall be distributed to the public in France and only (i) providers of investment services relating to portfolio management for the account of third parties (personnes fournissant le service d’investissement de gestion de portefeuille pour compte de tiers) and/or (ii) qualified investors (investisseurs qualifiés), all as defined in, and in accordance with, Articles L.411-1, L.411-2 and D.411-1 to D.411-3 of the French Code monétaire et financier, are eligible to participate in the Offers. This announcement and the Offer Memorandum has not been and will not be submitted for clearance procedures (visa) of the Autorité des marchés financiers.
United Kingdom
The Offers are only directed at persons who (i) are outside the United Kingdom or (ii) are investment professionals within the meaning of Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (the “Financial Promotion Order”) or (iii) are high net worth entities or other persons to whom the Offers may lawfully be communicated falling within Article 49(2)(a) to (e) of the Financial Promotion Order or (iv) fall within Article 43 of the Financial Promotion Order (all such persons together being referred to as “relevant persons”). The communication of this announcement and the Offer Memorandum must not be acted on or relied on by persons who are not relevant persons. Any investment or investment activity to which this communication relates is available only to relevant persons and will be engaged in only with relevant persons.
Switzerland
Holders of Existing Securities may only be invited to offer to exchange their Existing Securities for New Shares pursuant to the Exchange Offer or invited to sell their Existing Securities for purchase pursuant to the Tender Offer and the New Shares may only be offered in or into Switzerland in compliance with all applicable laws and regulations in force in Switzerland. To ensure compliance with the Swiss Code of Obligations and all other applicable laws and regulations of Switzerland, only the Offer Memorandum and the documents deemed to be incorporated by reference in this Offer Memorandum may be used in the context of any invitation to Holders of Existing Securities to (i) offer to exchange their Existing Securities for New Shares pursuant to the Exchange Offer, (ii) offer to sell their Existing Securities for purchase pursuant to the Tender Offer or (iii) offer the New Shares in or into Switzerland.
Portugal
This announcement and the Offer Memorandum has not been nor will be subject to the approval of the Portuguese Securities Market Commission (the “CMVM”). Each Dealer Manager has not offered or sold, and will not offer or sell any of the Existing Securities and/or the New Shares in Portugal or to residents of Portugal otherwise than in accordance with applicable Portuguese Law.
No approval action has been or will be requested from the CMVM that would permit a public offering of any of the Existing Securities and/or the New Shares referred to in this announcement and the Offer Memorandum, therefore the same cannot be offered to public in Portugal. Accordingly, no Existing Securities and/or the New Shares may be offered, sold or delivered except in circumstances that will result in compliance with any applicable laws and regulations. In particular, the Existing Securities and/or the Shares have not been nor will they be offered or sold to 100 or more addressees who are not Portuguese Qualified Investors and no offer has been preceded or followed by promotion or solicitation to unidentified investors, public advertisement, or followed by publication of any promotional material. In particular, this announcement and the Offer Memorandum and the offer of the Existing Securities and/or the New Shares is only intended for “Qualified Investors” within the meaning of Article 30 of the Portuguese Securities Code (“Código dos Valores Mobiliários”).
Contacts:
|
Filipe Worsdell |
Faisal Kanth |
||||||||
| Espírito Santo Financial Group S.A. | Taylor Rafferty | ||||||||
| +44 203 4292100 | +44 207 6142900 | ||||||||
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The Espírito Santo Financial Group provides, through its subsidiaries, a
global and diversified range of
financial services to its clients
including Commercial banking, Insurance, Investment banking,
Stockbrokerage and Asset management in Portugal and internationally. For
additional information on Espírito
Santo Financial Group, its
subsidiaries, operations and results, please visit the Company’s website
on
www.esfg.com