REG - Accrol Group Hldgs Navigator Company SA - Increased and Final Offer

Navigator SAAnnouncement

03/05/2024 14:45

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RNS Number : 2375N  Accrol Group Holdings PLC  03 May 2024

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 CONTAINS INSIDE INFORMATION. UPON THE PUBLICATION OF THIS
ANNOUNCEMENT VIA A REGULATORY INFORMATION SERVICE, THIS INSIDE INFORMATION IS
NOW CONSIDERED TO BE IN THE PUBLIC DOMAIN.

FOR IMMEDIATE RELEASE

3 May 2024

RECOMMENDED CASH OFFER

for

ACCROL GROUP HOLDINGS PLC

by

NAVIGATOR PAPER UK LIMITED

(an indirect wholly owned subsidiary of The Navigator Company, S.A.)

(to be implemented by way of a scheme of arrangement

under Part 26 of the Companies Act 2006)

INCREASED AND FINAL 1  (#_ftn1) OFFER FOR ACCROL GROUP HOLDINGS PLC

On 22 March 2024, the boards of directors of Accrol Group Holdings plc
("Accrol") and Navigator Paper UK Limited ("Bidco") announced (the "Original
Announcement") that they had reached agreement on the terms of a recommended
all-cash offer for the entire issued and to be issued share capital of Accrol
by Bidco (the "Offer"), such Offer to be implemented by means of a Court
approved scheme of arrangement under Part 26 of the Companies Act 2006 (the
"Scheme").

On 17 April 2024, the shareholder circular in relation to the Scheme (the
"Scheme Document") was published and made available to Accrol Shareholders
and, for information only, to participants in the Accrol Share Schemes.

Capitalised terms used in this announcement ("Announcement") shall, unless
otherwise defined, have the same meanings as set out in the Scheme Document.

This Announcement should be read in conjunction with the Scheme Document and
the Original Announcement.

Increased and Final Offer

The boards of directors of Accrol and Bidco are pleased to announce the terms
of a recommended increased and final cash offer by Bidco for the entire issued
and to be issued share capital of Accrol (the "Increased and Final Offer").

Under the terms of the Increased and Final Offer, Accrol Shareholders will be
entitled to receive:

for each Accrol Share:    39 pence in cash (the "Increased Offer Price")

Bidco considers the financial terms of the Increased and Final Offer to be
full and fair. Therefore Bidco today confirms that  the financial terms of
the Increased and Final Offer, including the Increased Offer Price, are final
and will not be increased, except that Bidco reserves the right to increase
the Increased Offer Price and/or otherwise improve the terms of the Increased
and Final Offer (i) if there is an announcement on or after the date of this
Announcement of a possible offer or of a firm intention to make an offer for
Accrol by any third party, or (ii) if the Takeover Panel otherwise provides
its consent.

The Increased Offer Price values Accrol's entire issued and to be issued share
capital at approximately £130.8 million and implies an enterprise value of
approximately £188.2 million and a multiple of approximately:

·      12.1x using Accrol FY2023A adjusted EBITDA of £15.6 million; and

·      10.0x using Accrol LTM (last twelve months) adjusted EBITDA of
£18.7 million for the period ended 31 October 2023.

The Increased Offer Price represents a premium of approximately 52 per cent.
to the average EV/LTM EBITDA multiple of 6.6x for publicly traded companies
across private label tissue, private label hygiene and other UK companies that
focus on private label products (source: Bloomberg 1 May 2024).

The Increased Offer Price represents a premium of approximately:

·      14.7 per cent. to the Closing Price of 34.0 pence per Accrol
Share on 21 March 2024 (being the last Business Day before the commencement of
the Offer Period);

·      32.1 per cent. to the Volume Weighted Average Price per Accrol
Share during the 6-month period ended on 21 March 2024; and

·      26.4 per cent. to the Volume Weighted Average Price per Accrol
Share during the 12-month period ended on 21 March 2024.

If any dividend, distribution or other return of value is announced,
authorised, declared, made or paid in respect of Accrol Shares on or after the
date of this Announcement and prior to the Effective Date, the Increased Offer
Price will be automatically reduced by the amount per Accrol Share of such
dividend, distribution and/or return of value. In such circumstances, Accrol
Shareholders will be entitled to retain any such dividend, distribution or
other return of value, and in which case any reference in this Announcement to
the Increased Offer Price will be deemed to be a reference to the Increased
Offer Price as so reduced. Any automatic reduction of the Increased Offer
Price or other exercise by Bidco of its rights and/or obligations referred to
in this paragraph will be the subject of an announcement and, for the
avoidance of doubt, not be regarded as constituting any revision or variation
of the terms of the Increased and Final Offer or the Scheme.

The Increased and Final Offer is subject to the terms and Conditions set out
in the Scheme Document (as modified by the terms of the Increased and Final
Offer contained in this Announcement). Accrol Shareholders should note that
Accrol does not intend to publish a revised scheme document for the Increased
and Final Offer.

Accrol confirms that there have been no changes to the information disclosed
in the Scheme Document that are material in the context of the Scheme,
including in relation to any matters referred to in Rule 27.2(c) of the
Takeover Code.

No third-party proposals

The Accrol Board confirms that, from the date on which Bidco announced its
firm intention to make the Offer (being 22 March 2024) to the date of this
Announcement, the Accrol Board has not received any proposal in respect of an
offer to acquire the entire issued, and to be issued, ordinary share capital
of Accrol from any third parties, nor is it currently in active discussions
with any third party regarding any such proposal.

Commenting on the Increased and Final Offer, Gareth Jenkins, Chief Executive
Officer of Accrol, said:

"The Increased and Final Offer represents a multiple of approximately 12.1x
against Accrol's FY2023A adjusted EBITDA and 10.0x against Accrol's LTM
adjusted EBITDA for the period ended 31 October 2023 and a premium of
approximately 52 per cent. against the average EV/LTM EBITDA multiple of 6.6x
paid for publicly traded companies across private label tissue, private label
hygiene and other UK companies that focus on private label products. As set
out in the Scheme Document, the Accrol Board believes that the supply dynamics
in the UK are set to change in the coming years with circa. 500k tonnes of
integrated capacity entering the UK market making the UK market significantly
more competitive. The Accrol Board believes that the Increased and Final Offer
and being part of a vertically integrated group invested into pulp and tissue
manufacturing capacity represents significant value for shareholders against a
back drop of increasing pulp and tissue prices and a very different and
challenging future environment."

Recommendation

The Accrol Directors, who have been so advised by Stifel as to the financial
terms of the Increased and Final Offer, consider the terms of the Increased
and Final Offer to be fair and reasonable. In providing its advice to the
Accrol Directors, Stifel has taken into account the commercial assessments of
the Accrol Directors. Stifel is providing independent financial advice to the
Accrol Directors for the purposes of Rule 3 of the Takeover Code.

Accordingly, the Accrol Directors recommend unanimously that Scheme
Shareholders vote in favour (or procure votes in favour) of the Scheme at the
Court Meeting and that Accrol Shareholders vote in favour (or procure votes in
favour) of the Resolution to be proposed at the General Meeting, as the Accrol
Directors who hold Accrol Shares have irrevocably undertaken to do (or procure
to be done) in respect of their own (and their connected persons') interests
in Accrol Shares, amounting, in aggregate to 17,124,230 Accrol Shares
(representing, in aggregate, approximately 5.4 per cent. of the total issued
share capital of Accrol as at 2 May 2024 (being the latest practicable date
prior to publication of this Announcement).

Irrevocable undertakings

All of the irrevocable undertakings described in the Scheme Document continue
to remain valid in relation to the Increased and Final Offer, therefore, the
total number of Accrol Shares which are subject to irrevocable undertakings by
Bidco from Accrol Shareholders is 108,527,354 Accrol Shares, in aggregate,
representing approximately 34 per cent. of the issued share capital of Accrol
as at 2 May 2024 (being the latest practicable date prior to publication of
this Announcement).

In accordance with Rule 35.1 of the Takeover Code, if the Increased and Final
Offer lapses, except with the consent of the Panel, Bidco will not be able to
make an offer for Accrol for at least twelve months.

Financing of the Increased and Final Offer

The Increased and Final Offer will be financed from existing cash resources
available to the Wider Navigator Group, and Navigator and Bidco have entered
into an amended and restated inter-company loan agreement in relation to the
financing of the Increased and Final Offer (the "Amended and Restated Loan
Agreement").

Rothschild & Co, in its capacity as financial adviser to the Wider
Navigator Group, is satisfied that sufficient cash resources are available to
Bidco to enable it to satisfy in full the Consideration payable to Accrol
Shareholders under the terms of the Increased and Final Offer.

Court Meeting and General Meeting

The Accrol Board confirms that the Court Meeting and the General Meeting,
notices of which are set out in Part VIII (Notice of Court Meeting) and Part
IX (Notice of General Meeting) of the Scheme Document respectively, will be
held at 11.00 a.m. (London time) and 11.15 a.m. (London time, or as soon
thereafter as the Court Meeting shall have concluded or been adjourned),
respectively, on 15 May 2024 at the offices of Addleshaw Goddard LLP at One St
Peter's Square, Manchester, M2 3DE, in accordance with the timetable set out
in the Scheme Document.

Action to be taken by Accrol Shareholders

As further detailed in the Scheme Document, in order to become Effective, the
Scheme will require, among other things, the approval of Scheme Shareholders
at the Court Meeting and the passing of the Resolution by Accrol Shareholders
at the General Meeting. It is important that, for the Court Meeting in
particular, as many votes as possible are cast so that the Court may be
satisfied that there is a fair representation of Scheme Shareholder opinion.

Accrol Shareholders who have not yet done so are therefore strongly urged to
complete, sign and return the Forms of Proxy in accordance with the
instructions printed thereon or, alternatively, to appoint a proxy or voting
instruction online or through CREST, for both the Court Meeting and the
General Meeting, as soon as possible and by no later than the following times
and dates:

·    BLUE Form of Proxy for use at the Court Meeting so as to be received
no later than 11.00 a.m. (London time) on 13 May 2024; and

·    WHITE Form of Proxy for use at the General Meeting so as to be
received no later than 11.15 a.m. (London time) on 13 May 2024.

If the BLUE Form of Proxy for the Court Meeting is not returned by the above
time, a copy of the completed and signed BLUE Form of Proxy may be handed to
the chairman of the Court Meeting at any time before the time that the Court
Meeting is due to commence and it will still be valid. However, in the case of
the General Meeting, if the WHITE Form of Proxy is not returned so as to be
received by the time mentioned above and in accordance with the instructions
on the WHITE Form of Proxy, it will be invalid.

Accrol Shareholders are reminded that completion and return of a Form of
Proxy, or the appointment of a proxy appointment or voting instruction online,
through CREST or by any other procedure described in the Scheme Document, will
not prevent them from attending, speaking and voting in person at either the
Court Meeting or the General Meeting, or any adjournment thereof, if they wish
and are entitled to do so.

Accrol Shareholders who do NOT wish to change their voting instructions

Accrol Shareholders who have already submitted Forms of Proxy or voting
instructions online, through CREST or by any other procedure described in the
Scheme Document for the Court Meeting and/or the General Meeting and who do
not wish to change their voting instructions need take no further action as
their Forms of Proxy or voting instructions online will continue to be valid
in respect of the Court Meeting and the General Meeting.

Accrol Shareholders who DO wish to change their voting instructions

Accrol Shareholders who have already submitted Forms of Proxy for the Court
Meeting and/or the General Meeting and who now wish to change their voting
instructions, should contact Link Group by calling the shareholder helpline
between 9.00 a.m. and 5.30 p.m. (London time) Monday to Friday (except public
holidays in England and Wales) on 0371 664 0321 (if calling from within the
UK) or +44 (0) 371 664 0321 (if calling from overseas). Please note that calls
may be monitored or recorded and Link Group cannot provide advice on the
merits of the Offer, the Increased and Final Offer or the Scheme or give any
financial, legal or tax advice. Calls are charged at the standard geographic
rate and will vary by provider, calls outside the United Kingdom will be
charged at the applicable international rate.

Accrol Shareholders who have already appointed a proxy online or through CREST
or by any other procedure described in the Scheme Document, for the Court
Meeting and/or the General Meeting and who now wish to change their voting
instructions are able to do so via CREST or using such other procedure as was
used in respect of the original appointment.

Conditions

The Conditions to the Offer are set out in full in Part III (Conditions to the
implementation of the Scheme and to the Offer) of the Scheme Document.

The Scheme will be modified to reflect the terms of the Increased and Final
Offer. Save as disclosed in this Announcement, the Increased and Final Offer
is subject to the same terms and Conditions as are set out in the Scheme
Document.

Timetable

The Scheme Document contains an expected timetable of principal events
relating to the Scheme, which is also set out in Appendix 1 to this
Announcement. Subject to obtaining the approval of the requisite majority of
eligible Scheme Shareholders at the Court Meeting, the requisite majority of
Accrol Shareholders at the General Meeting and the satisfaction or waiver of
the other Conditions set out in the Scheme Document, including the approval of
the Court, it is currently expected that the Scheme will become Effective on
24 May 2024. If any of the dates and/or times in the expected timetable
change, the revised dates and/or times will be notified by announcement
through a Regulatory Information Service.

General

The Increased and Final Offer, does not change Bidco's intentions as regards
the business of Accrol (including locations of its operations), the
management, employees, research and development and locations of business of
Accrol, as set out in the Scheme Document and in the letters already sent to
the participants in the Accrol Share Schemes informing them of the effect of
the Scheme on their rights under the Accrol Share Schemes and, where
applicable, containing appropriate proposals in respect of such rights.

Consents

Rothschild & Co, Stifel and Zeus have each given, and not withdrawn, their
consent to the publication of this Announcement with the inclusion herein of
the reference to their respective names, in each case, in the form and context
in which they appear.

Sources and Bases

Appendix 2 to this Announcement contains sources and bases of certain
information contained in this Announcement.

Documents available on website

Copies of the following announcements and documents will, by no later than 12
noon on the Business Day following the date of this Announcement, be published
on Accrol's website at
https://www.accrol.co.uk/investors/recommended-offer-for-accrol-group-holdings-plc/
(https://www.accrol.co.uk/investors/recommended-offer-for-accrol-group-holdings-plc/)
and Navigator's website at
https://www.thenavigatorcompany.com/Investidores/Recommended-cash-offer-for-accrol-group-holdings-plc
(https://www.thenavigatorcompany.com/Investidores/Recommended-cash-offer-for-accrol-group-holdings-plc)
(subject to, in each case, any applicable restrictions relating to persons
resident in Restricted Jurisdictions):

·    this Announcement;

·    the consent letters from each of Rothschild & Co, Stifel and
Zeus, in respect of the consents referred to above; and

·    a copy of the Amended and Restated Loan Agreement.

Neither the contents of Bidco's website or the contents of Accrol's website,
nor the content of any other website accessible from hyperlinks on either such
website, is incorporated into, or forms part of, this Announcement.

The person responsible for arranging the release of this Announcement on
behalf of Bidco is Fernando Araújo.

The person responsible for arranging the release of this Announcement on
behalf of Accrol is Gareth Jenkins.

Enquiries:

 Bidco                                                              +(351) 219 017 411
 Fernando Araújo, Executive Board Member
 António Neto Alves, General Counsel

 Rothschild & Co (Financial adviser to Bidco)                       +44 (0) 207 280 5000
 Stuart Vincent

 Joe Boyd-Morritt

 Accrol
 Daniel Wright, Executive Chairman

 Gareth Jenkins, Chief Executive Officer
 Christopher Welsh, Chief Financial Officer

 Stifel (Rule 3 adviser and lead financial adviser to Accrol)       +44 (0) 207 710 7600
 Celedonio Moncayo / Henry Newbould
 Nick Harland / Richard Short

 Zeus (Joint financial adviser and nominated adviser to Accrol)     +44 (0) 161 831 1512
 Dan Bate / Jordan Warburton

 Belvedere Communications Limited (Financial PR adviser to Accrol)  +44 (0) 7715 769 078
 Cat Valentine

 Keeley Clarke

Eversheds Sutherland (International) LLP is retained as legal adviser to the
Wider Navigator Group.

Addleshaw Goddard LLP is retained as legal adviser to Accrol.

Important Notices Relating to Financial Advisers

N.M. Rothschild & Sons Limited ("Rothschild & Co"), which is
authorised and regulated by the Financial Conduct Authority in the United
Kingdom, is acting exclusively for the Wider Navigator Group  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 in this
Announcement and will not be responsible to anyone other than Wider Navigator
Group  for providing the protections afforded to clients of Rothschild &
Co nor for providing advice in relation to any matter referred to in this
Announcement or any transaction or arrangement referred to herein. Neither
Rothschild & Co nor any of its 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 Rothschild & Co in connection with this Announcement, any
statement contained herein, any transaction or arrangement referred to herein,
or otherwise.

Stifel Nicolaus Europe Limited ("Stifel"), which is authorised and regulated
in the United Kingdom by the Financial Conduct Authority, is acting
exclusively as Rule 3 adviser and lead financial adviser for Accrol and for no
one else in connection with the matters set out or referred to in this
Announcement and will not be responsible to anyone other than Accrol for
providing the protections offered to clients of Stifel nor for providing
advice in relation to the matters set out or referred to in this Announcement.
Neither Stifel nor any of its 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
Stifel in connection with this Announcement, any matter or statement set out
or referred to herein or otherwise.

Zeus Capital Limited ("Zeus"), which is authorised and regulated by the FCA in
the United Kingdom, is acting exclusively as joint financial adviser and
nominated adviser for Accrol and for no one else in connection with the Offer
and/or any other matter referred to in this Announcement and will not be
responsible to anyone other than Accrol for providing the protections afforded
to its clients or for providing advice in relation to the Offer, the contents
of this Announcement, or any other matters referred to in this Announcement.
Neither Zeus nor any of its subsidiaries, affiliates or branches owes or
accepts any duty, liability or responsibility whatsoever (whether direct,
indirect, consequential, whether in contract, in tort, under statute or
otherwise) to any person who is not a client of Zeus in connection with this
Announcement, any statement or other matter or arrangement referred to herein
or otherwise.

Further Information

This Announcement is for information purposes only and is not intended to and
does not constitute, or form any part of, an offer or invitation to purchase,
otherwise acquire, subscribe for, exchange, sell or otherwise dispose of, any
securities or the solicitation of any vote or approval in any jurisdiction
pursuant to the Offer or otherwise.

The Offer is subject to English law and to the applicable requirements of the
Takeover Code, the Panel, the AIM Rules, the London Stock Exchange and the
FCA.

The Offer is made solely by the Scheme Document (or, in the event that the
Offer is to be implemented by means of a Takeover Offer, the Offer Document),
which contains the full terms and conditions of the Offer, including details
of how to vote in respect of the Scheme. Any voting decision or response in
relation to the Offer should be made solely on the basis of the Scheme
Document. Accrol Shareholders are advised to read the formal documentation in
relation to the Offer carefully. Each Accrol Shareholder is urged to consult
their independent professional adviser regarding the tax consequences of the
Offer.

This Announcement does not constitute a prospectus or a prospectus equivalent
document.

If you are in any doubt about the contents of this Announcement or the action
you should take, you are recommended to seek your own independent financial
advice immediately from your stockbroker, bank manager, solicitor, accountant
or from an independent financial adviser duly authorised under the FSMA.

Right to Switch to a Takeover Offer

Bidco reserves the right to elect, with the consent of the Panel, to implement
the Offer by way of a Takeover Offer for the entire issued and to be issued
share capital of Accrol as an alternative to the Scheme. In such an event, the
Takeover Offer will be implemented on the same terms or, if Bidco so decides,
on such other terms being no less favourable (subject to appropriate
amendments), so far as applicable, as those which would apply to the Scheme
and subject to the amendment referred to in paragraph 2 of Part C of Part III
of the Scheme Document.

Publication on Website

A copy of this Announcement shall be made available, subject to certain
restrictions relating to persons resident in Restricted Jurisdictions, on
Accrol's and Bidco's websites, free of charge, at
https://www.accrol.co.uk/investors/recommended-offer-for-accrol-group-holdings-plc/
(https://www.accrol.co.uk/investors/recommended-offer-for-accrol-group-holdings-plc/)
and at
https://www.thenavigatorcompany.com/Investidores/Recommended-cash-offer-for-accrol-group-holdings-plc
(https://www.thenavigatorcompany.com/Investidores/Recommended-cash-offer-for-accrol-group-holdings-plc)
and by no later than 12 noon (London time) on the Business Day following the
date of this Announcement.

For the avoidance of doubt, neither the contents of these websites nor the
content of any other website accessible from hyperlinks on such websites is
incorporated into, or forms part of, this Announcement.

Rounding

Certain figures included in this document have been subjected to rounding
adjustments.

 

Further information

The information contained within this Announcement is deemed to constitute
inside information as stipulated under the Market Abuse (Amendment) (EU Exit)
Regulations 2019. Upon the publication of this Announcement, this inside
information is now considered to be in the public domain.

 

 

APPENDIX 1

EXPECTED TIMETABLE OF PRINCIPAL EVENTS

The following indicative timetable is based on Accrol and Bidco's current
expected dates for the implementation of the Scheme and is subject to change.
If any of the dates and/or times in this expected timetable change, the
revised dates and/or times will be notified to Accrol Shareholders by
announcement through the Regulatory Information Service of the London Stock
Exchange.

 Event                                                                           Time and/or date (2024) ((1))
 Latest time for lodging Forms of Proxy for the:

                 Court Meeting (BLUE Form of Proxy)                              11.00 a.m. on 13 May ((2))

                 General Meeting (WHITE Form of Proxy)                           11.15 a.m. on 13 May ((3))
 Voting Record Time for the Court Meeting and the General Meeting                6.00 p.m. on 13 May ((4))
 Court Meeting                                                                   11.00 a.m. on 15 May
 General Meeting                                                                 11.15 a.m. on 15 May ((5))
 The following dates are indicative only and are subject to change ((6))
 Court Sanction Hearing                                                          22 May
 Last day of dealings in, and for registration of transfers of, and disablement  23 May
 in CREST of, Accrol Shares
 Scheme Record Time                                                              6.00 p.m. on 23 May
 Dealings in Accrol Shares suspended                                             at or around 7.30 a.m. on 24 May
 Effective Date of the Scheme                                                    24 May ((7))
 Cancellation of admission of Accrol Shares to trading on AIM                    by no later than 8.00 a.m. on 28 May
 Latest date for despatch of cheques and crediting of CREST for Consideration    7 June
 due under the Scheme
 Long Stop Date                                                                  30 June ((8))

Notes:

(1)     All references in this Announcement to times are to London time
unless otherwise stated.

(2)     It is requested that BLUE Forms of Proxy for the Court Meeting be
lodged no later than 48 hours (excluding any part of such 48-hour period that
is not a Business Day) before the time and date set for the Court Meeting. A
copy of a completed and signed BLUE Form of Proxy not so lodged may be handed
to the chairman of the Court Meeting at any time before the time that the
Court Meeting is due to commence and will still be valid.

(3)     WHITE Forms of Proxy for the General Meeting must be lodged no
later than 48 hours (excluding any part of such 48-hour period that is not a
Business Day) before the time and date set for the General Meeting. WHITE
Forms of Proxy for the General Meeting not lodged by this time will be
invalid.

(4)     If either the Court Meeting or the General Meeting is adjourned,
the Voting Record Time for the relevant adjourned Meeting will be 6.00 p.m. on
the date falling two Business Days before the date of the adjourned Meeting.

(5)     The General Meeting will commence at 11.15 a.m. or as soon
thereafter as the Court Meeting shall have concluded or been adjourned.

(6)     These dates and times are indicative only and will depend, among
other things, on the date upon which: (i) the Conditions are satisfied or (if
capable of waiver) waived; (ii) the Court sanctions the Scheme; and (iii) a
copy of the Court Order is delivered to the Registrar of Companies for
registration.

(7)     Following sanction of the Scheme by the Court, the Scheme will
become Effective in accordance with its terms upon a copy of the Court Order
being delivered to the Registrar of Companies for registration. This is
presently expected to occur on the second Business Day following the date of
the Court Sanction Hearing, subject to satisfaction or (where capable of
waiver) waiver of the Conditions.

(8)     This is the latest date by which the Scheme may become Effective
unless Bidco and Accrol agree (and the Panel and, if required, the Court
permit) a later date or if the Panel requires an extension to the Long Stop
Date pending final determination of an issue under section 3(g) of Appendix 7
to the Takeover Code.

 

 

 

APPENDIX 2

SOURCES OF INFORMATION AND BASES OF CALCULATION

 

In this Announcement, unless otherwise stated or the context otherwise
requires, the following sources and bases have been used:

·    The fully diluted equity value of Accrol has been calculated as being
approximately £130.8 million on the basis of a fully diluted issued ordinary
share capital of 335,444,589 Accrol Shares, being:

(a)  318,878,097 Accrol Shares in issue as at the Last Practicable Date; plus

(b)  16,566,492 Accrol Shares to be issued on the expected exercise of
options granted or expected to be granted under the Accrol LTIP on the
exercise of options under the Accrol LTIP,

(excluding the Warrants (as the outstanding Warrants are to be surrendered by
the Warrant Holder and cancelled upon the Offer becoming Effective)).

 

·    The enterprise value of Accrol has been calculated as being
approximately £188.2 million on the basis of:

 

o  Accrol's fully diluted equity value of approximately £130.8 million (as
calculated above); plus

 

o  Accrol's net debt of approximately £57.4 million calculated as per note 9
of Accrol's interim results for the 6 months ended 31 October 2023 published
by Accrol on 30 January 2024. This includes: total borrowing (excluding
finance fees); less: lease receivables; less: cash and cash equivalents.

 

·    Accrol's LTM (last twelve months) adjusted EBITDA of £18.7 million
for the period ended 31 October 2023 has been calculated by reference to
Accrol's adjusted EBITDA of £15.6 million (as published in its audited
consolidated accounts for the 12 months ended 30 April 2023) less Accrol's
adjusted EBITDA of £7.1 million (as published in its interim results for the
6 months ended 31 October 2022) plus Accrol's adjusted EBITDA of £10.2
million (as published in its interim results for the 6 months ended 31 October
2023).

·    The premia calculations to the price per Accrol Share used in this
Announcement have been calculated by reference to:

(a)  the Closing Price on 21 March 2024 (being the last Business Day before
the commencement of the Offer Period) of 34.0 pence per Accrol Share;

(b)  the Volume Weighted Average Price of 29.5 pence per Accrol Share during
the 6-month period ended on the last Business Day before the commencement of
the Offer Period; and

(c)   the Volume Weighted Average Price of 30.8 pence per Accrol Share
during the 12-month period ended on the last Business Day before the
commencement of the Offer Period.

 

·    Unless otherwise stated, the financial information of Accrol is
extracted (without material adjustment) from the annual report and audited
accounts of the Accrol for the 12 months ended 30 April 2023.

 

·    Certain figures included in this Announcement have been subject to
rounding adjustments.

 

·    EV/LTM EBITDA multiple for publicly traded companies across private
label tissue, private label hygiene and other UK companies that focus on
private label products, Bloomberg as of 1 May 2024 calculated as below:

 

 Company Name           EV/EBITDA
 ONTEX GROUP NV         9.4x
 ESSITY AKTIEBOLAG-A    9.1x
 MCBRIDE PLC            5.0x
 CASCADES INC           5.1x
 CLEARWATER PAPER CORP  4.1x
 GLATFELTER CORP        8.1x
 BAKKAVOR GROUP PLC     6.0x
 GREENCORE GROUP PLC    6.0x
 Average                6.6x

 

 1  (#_ftnref1) Bidco reserves the right to increase the Increased Offer Price
and/or otherwise improve the terms of the Increased and Final Offer (i) if
there is an announcement on or after the date of this Announcement of a
possible offer or of a firm intention to make an offer for Accrol by any third
party, or (ii) if the Takeover Panel otherwise provides its consent.

 

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