EVR Holdings PLC Confirmation of successful fundraise of £5 million (3501H)

TIDMEVRH

RNS Number : 3501H

EVR Holdings PLC

07 June 2017

7 June 2017

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

THIS ANNOUNCEMENT IS FOR INFORMATION PURPOSES ONLY AND DOES NOT CONSTITUTE OR CONTAIN ANY INVITATION, SOLICITATION, RECOMMATION, OFFER OR ADVICE TO ANY PERSON TO SUBSCRIBE FOR, OTHERWISE ACQUIRE OR DISPOSE OF ANY SECURITIES IN EVR HOLDINGS PLC OR ANY OTHER ENTITY IN ANY JURISDICTION. NEITHER THIS ANNOUNCEMENT NOR THE FACT OF ITS DISTRIBUTION, SHALL FORM THE BASIS OF, OR BE RELIED ON IN CONNECTION WITH ANY INVESTMENT DECISION IN RESPECT OF EVR HOLDINGS PLC.

This announcement contains inside information

EVR Holdings plc

("EVR" or the "Company")

Confirmation of successful fundraise of GBP5 million

Total Voting Rights

EVR (AIM: EVRH), one of the leading creators of virtual reality content, announces that, further to the announcement made on 6 June 2017 entitled "Accelerated Bookbuild to raise gross proceeds of approximately GBP5 million and change of Nominated Adviser and Broker", the Company has raised gross proceeds of GBP5 million through the successful placing of 62,500,000 Placing Shares at a price of 8 pence per new Ordinary Share. The Placing Price represents a discount of 4.5 per cent. to the closing price on 6 June 2017 being the latest practicable date prior to the date of this announcement.

Application will be made to the London Stock Exchange for the 62,500,000 Placing Shares to be admitted to trading on AIM at 8.00 a.m. on 13 June 2017 ("Admission"). Once Admission occurs, the Placing will have successfully completed. Upon completion of the Placing, the Placing Shares will represent approximately 6.12 per cent. of the Enlarged Share Capital.

The net proceeds of the Placing of approximately GBP4.7 million will be used to make further investments into the Company's original content library as well as to extend the capacity of its live music capture and digital content creation capabilities both in the UK and overseas, expanding upon existing resources and infrastructure, increasing global marketing efforts as well as research and development in areas such as post production and camera technology.

Zeus Capital Limited, the Company's Nominated Adviser and Broker, acted as sole bookrunner in connection with the Placing.

Anthony Matchett, CEO of EVR, commented:

"Since listing, EVR has delivered on a number of strategic milestones, including global partnerships with Warner Music Group and Universal Music Group. MelodyVR was founded with the simple vision of enabling music fans across the globe to connect with the artists they love via next-generation technologies, enabling consumers to virtually stand on stage at any concert or in the recording studio with their favourite artists.

"Having founded the business three years ago, the VR market today is near incomparable. Hardware manufacturers such as Facebook, Samsung, Sony, Microsoft and Google have all shipped VR hardware and many are in the process of launching new or updated VR devices. Over the last three years, we've seen VR user numbers increase from under 200,000 prototype devices to over 7.5 million units worldwide. Mark Zuckerberg recently said that he believes "VR is the next major computing and communication platform" and looking ahead to the next three years, market research estimates that there will be over 225 million VR devices in consumer hands. Just as MTV conquered with video in the 90s and Spotify has redefined music consumption throughout the last decade, MelodyVR's goal is to deliver the next-generation of music content to fans.

"The proceeds of this successful placing will be used to fuel the global expansion of our business, to reach more artists, more partners and in turn, more consumers. We'll be investing further capital into our original content as we seek to grow our vast library of once-in-a-lifetime experiences. We believe that as the market develops and consumer appetite for VR content increases, we're perfectly positioned to deliver consumers the best in immersive music experiences via our hardware agnostic VR music platform.

"We'll be investing into additional resourcing and staff on a global basis, aiming to attract even more of the best talent in the UK, as well as throughout US offices in Los Angeles, New York, Miami and Nashville, as well as in other music industry epicentres, worldwide.

"As part of this announcement, I'm pleased to announce the promotion of Nikki Lambert to the role of Chief Marketing Officer. Nikki, formerly of the Virgin Group and more recently Spotify, has proven invaluable since joining the company last year. As we progress towards launch we'll be committing further resources into marketing throughout Europe and the US, building upon our strategy of amplifying artists, labels and hardware partners as they talk about our platform and content, with a series of unique promotional campaigns.

"Over the coming months, our aim is to further extend our market leading position by closing partnerships with all three of the world's major record labels, having already secured deals with two - Universal Music Group and Warner Music Group, and by entering agreements with music publishers, collection societies and performance rights organisations as well as hardware partners on a worldwide basis, enhancing the opportunities for deployment of the MelodyVR platform across the globe.

"I am delighted with the support that we have had from our existing institutional investor and I am pleased to welcome new institutional investors to our shareholder register. We'd like to thank all of our investors, partners and team for believing that MelodyVR can deliver a new, meaningful and long term revenue stream for the music industry."

Total Voting Rights

Following Admission, the total number of Ordinary Shares and voting rights in the Company will be 1,021,625,846. The Company does not hold any shares in treasury. The above figure may be used by Shareholders as the denominator for the calculations by which they will determine if they are required to notify their interest in, or a change to their interest in, the share capital of the Company under the FCA's Disclosure and Transparency Rules.

Unless otherwise defined, all capitalised terms in this announcement are defined at the end of the announcement made on 6 June 2017 entitled "Accelerated Bookbuild to raise gross proceeds of approximately GBP5 million and change of Nominated Adviser and Broker".

For further information:

 
EVR Holdings plc 
Sean Nicolson, Chairman                            Tel: [phone] 
                                                                   2020 
Anthony Matchett, Chief                             www.evrholdings.com 
 Executive Officer 
 
Zeus Capital Limited (Nominated Adviser 
 and Broker) 
Phil Walker / Andrew Jones (Corporate Finance)     Tel: [phone] 
                                                                   5000 
John Goold / Benjamin Robertson (Sales &          www.zeuscapital.co.uk 
 Broking) 
 
 

Media enquiries:

 
Instinctif 
Kay Larsen / Chantal Woolcock  Tel: [phone] 
                                               2020 
                                 www.instinctif.com 
 

Notes to Editors:

MelodyVR

MelodyVR is a wholly owned subsidiary of EVR Holdings plc ('EVR'), a company that is listed on the AIM market of the London Stock Exchange under the ticker EVRH.L. EVR, a creator of virtual reality content, joined AIM on 16 May 2016 following a reverse takeover of Armstrong Ventures plc. Further information can be viewed at www.evrholdings.com

Virtual Reality in 2017

The virtual reality industry is growing at a significant rate following the launches of Oculus Rift, Playstation VR and HTC Vive. Goldman Sachs estimate that the market could be worth US$80bn by 2025.

Additional information on the Placing

   1.         Background to and reasons for the Placing and use of proceeds 

MelodyVR was formed to capitalise on the expected wave of virtual reality ("VR") hardware which has been released since 2015. MelodyVR recognised that a significant investment had been made in VR hardware, but that would only be a limited amount of VR content available.

Since its admission to AIM on 16 May 2016, the Company has continued building an end-to-end virtual reality content production and distribution business with the vision and consumer proposition to allow music fans to experience a recorded music event or concert, via virtual reality. The Directors believe that MelodyVR's proposition will appeal to many music fans that are unable to attend a live event due to geographical or financial constraints, age restrictions or simply to an event being sold out.

The fundraising will enable MelodyVR to make further investments in its content library as well as to extend the capacity of its live music capture and digital content creation capabilities both in the UK and overseas, expanding upon existing resources and infrastructure, increasing global marketing efforts as well as research and development in areas such as post production and camera technology.

   2.         Details of the Placing 

Structure

The Directors have given careful consideration as to the structure of the proposed Placing and have concluded that the Placing is the most suitable option available to the Company and its Shareholders at this time.

The Placing is raising approximately GBP4.7 million funds (net of expenses) for the Company by way of the issue of 62,500,000 Placing Shares at the Placing Price of 8 pence per share.

Principal terms of the Placing

In accordance with the terms of the Placing Agreement, Zeus Capital has been appointed, as agent for the Company, to use its reasonable endeavours to procure institutional and other investors to subscribe for the Placing Shares at the Placing Price in order to raise approximately GBP5 million.

The Placing is not being underwritten.

Under the Placing Agreement, the Company has agreed to pay to Zeus Capital a corporate finance fee together with a commission based on the aggregate value of certain of the Placing Shares placed at the Placing Price and the costs and expenses of the Placing together with any applicable VAT.

Conditionality

The Placing is conditional, inter alia, upon the following:

-- Admission occurring by no later than 8.00 a.m. on 13 June 2017 (or such later times and/or dates as may be agreed between the Company and Zeus Capital, being no later than 8.00 a.m. on 20 June 2017); and

-- the Placing Agreement becoming unconditional in all respects (save for the condition relating to Admission) and not having been terminated in accordance with its terms.

If the conditions set out above are not satisfied or, where capable of waiver, waived the Placing will lapse and the Placing Shares will not be issued and all monies received from investors in respect of the Placing Shares will be returned to them (at the investors' risk and without interest) as soon as possible thereafter.

Application for Admission

Application will be made to the London Stock Exchange for the Placing Shares to be admitted to trading on AIM. Admission of the Placing Shares is expected to take place, and dealings on AIM are expected to commence, at 8.00 a.m. on 13 June 2017 (or such later time and/or dates as may be agreed between the Company and Zeus Capital).

The Placing Shares will, following Admission, rank pari passu in all respects with the Existing Ordinary Shares and will carry the right to receive all dividends and distributions declared, made or paid on or in respect of the Ordinary Shares after Admission.

   3.         Current trading and prospects 

The Company announced on 22 December 2016, that it had signed a global framework agreement with Warner Music Group ("WMG") and granted warrants to WMG to subscribe for up to 43,239,926 Ordinary Shares at 4.25 pence per share. On the same day, the Company also announced the launch of the beta version of the MelodyVR app.

In addition, the Company announced on 20 March 2017 that it had signed a global framework agreement with Universal Music Group ("UMG") and granted warrants to UMG to subscribe for up to 43,239,926 Ordinary Shares at 12.375p per share.

The Company continues to follow an aggressive global expansion strategy, focusing heavily on original content creation, content licensing, product development and in as areas of interest such as content analytics, augmented reality and interactive advertising.

Feedback from beta testing of MelodyVR's application, which commenced in December 2016, has proven to be extremely positive and has provided numerous insights into consumer behaviour, leading to several refinements to the platform's user experience.

In order to further increase worldwide production capabilities and in-line with the Company's 2017 growth strategy, the Company intends to open a series of satellite offices throughout Europe, North America and Asia. The offices, opening initially in Los Angeles and New York, will enable the Company to better serve its partners, such as record labels, hardware manufacturers and artists. Following a series of key hires in areas such as marketing, licensing and engineering, the Company now intends to grow its global presence, attracting world-class talent from both the music and technology industries, at both management and director level.

As the VR market matures, MelodyVR will launch its free-of-charge application across the leading VR hardware and devices. The Board believes that the MelodyVR platform, featuring both live and recorded performances from world-renowned artists and musicians, will cater to the growing consumer demand for VR entertainment content and, in turn, generate significant revenues for the group post-launch.

To date, MelodyVR has created thousands of hours of interactive VR experiences featuring over 526 international recording artists and currently has 72 exclusive partnerships with event and festival brands for VR content creation and distribution, for terms commonly of 5 years (but also up to 25 years).

MelodyVR will pursue its goal of launching what the Board believes will be the leading destination for music in VR and the world's next major music platform.

The Directors believe that the factors set out above all contribute to an extremely positive outlook for the Company and they remain confident in the Company's future performance and growth.

   4.         Effect of the Placing 

Upon completion of the Placing, the Placing Shares will represent approximately 6.12 per cent. of the Enlarged Share Capital.

   5.         The Placing Agreement 

Pursuant to the terms of the Placing Agreement, Zeus Capital has agreed to use its reasonable endeavours, as agent for the Company, to procure subscribers for the Placing Shares at the Placing Price.

The Placing Agreement is conditional upon, among other things, the conditions set out above and none of the warranties or undertakings given to Zeus Capital prior to Admission being or becoming untrue, inaccurate or misleading in any material respect.

The Placing Agreement contains customary warranties given by the Company in favour of Zeus Capital in relation to, inter alia, the accuracy of the information in this document and other matters relating to the Group and its business. In addition, the Company has agreed to indemnify Zeus Capital (and their affiliates) in relation to certain liabilities which they may incur in respect of the Placing.

Zeus Capital has the right to terminate the Placing Agreement in certain circumstances prior to Admission. In particular, in the event of a material breach of the warranties or a material adverse change or if the Placing Agreement does not become unconditional.

Forward-looking statements

This announcement contains statements about EVR that are or may be deemed to be "forward-looking statements".

All statements, other than statements of historical facts, included in this announcement may be forward-looking statements. Without limitation, any statements preceded or followed by, or that include, the words "targets", "plans", "believes", "expects", "aims", "intends", "will", "may", "should", "anticipates", "estimates", "projects", "would", "could", "continue" or words or terms of similar substance or the negative thereof, are forward-looking statements. Forward-looking statements include, without limitation, 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 operations of EVR.

These forward-looking statements are not guarantees of future performance. These forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of any such person, or industry results, to be materially different from any results, performance or achievements expressed or implied by such forward-looking statements. 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. Investors should not place undue reliance on such forward-looking statements and, save as is required by law or regulation (including to meet the requirements of the AIM Rules, MAR, the Prospectus Rules and/or the FSMA), EVR does not undertake any obligation to update publicly or revise any forward-looking statements (including to reflect any change in expectations with regard thereto or any change in events, conditions or circumstances on which any such statement is based). All subsequent oral or written forward-looking statements attributed to EVR or any persons acting on their behalf are expressly qualified in their entirety by the cautionary statement above. All forward-looking statements contained in this announcement are based on information available to the Directors of EVR at the date of this announcement, unless some other time is specified in relation to them, and the posting or receipt of this announcement shall not give rise to any implication that there has been no change in the facts set forth herein since such date.

DEFINITIONS

In this announcement capitalised terms shall (unless the context requires otherwise) have the following meanings:

 
 Admission                  admission of the Placing 
                             Shares to trading on 
                             AIM and such admission 
                             becoming effective in 
                             accordance with the AIM 
                             Rules; 
 
 AIM                        the AIM market operated 
                             by the London Stock Exchange; 
 
 AIM Rules                  the AIM Rules for Companies 
                             and/or the AIM Rules 
                             for Nominated Advisers 
                             (as the context may require); 
 
 AIM Rules for Companies    the rules of AIM as set 
                             out in the publication 
                             entitled 'AIM Rules for 
                             Companies' published 
                             by the London Stock Exchange 
                             from time to time; 
 
 AIM Rules for Nominated    the rules of AIM as set 
  Advisers                   out in the publication 
                             entitled 'AIM Rules for 
                             Nominated Advisers' published 

                             by the London Stock Exchange 
                             from time to time; 
 
 Board or Directors         the board of directors 
                             of the Company for the 
                             time being; 
 Company or EVR             EVR Holdings plc, a company 
                             incorporated in England 
                             and Wales with registered 
                             number 5628362 and having 
                             its registered office 
                             at 3rd Floor, Camden 
                             Wharf, 28 Jamestown Road, 
                             London, NW1 7BY; 
 Enlarged Share Capital     the issued share capital 
                             of the Company immediately 
                             following Admission; 
 
 EU                         the European Union; 
 
 Existing Ordinary Shares   the 959,125,846 Ordinary 
                             Shares in issue as at 
                             the date of this announcement; 
 
 FCA                        the Financial Conduct 
                             Authority; 
 
 FSMA                       the Financial Services 
                             and Markets Act 2000, 
                             as amended; 
 
 Group                      the Company and its subsidiary 
                             undertakings at the date 
                             of this document; 
 MAR                        the Market Abuse Regulation, 
                             being EU Regulation 596/2014 
 
 MelodyVR                   MelodyVR Limited, a company 
                             incorporated in England 
                             and Wales with registered 
                             number 09555357 and having 
                             its registered office 
                             at 3rd Floor, Camden 
                             Wharf, 28 Jamestown Road, 
                             London, NW1 7BY; 
 
 London Stock Exchange      London Stock Exchange 
                             plc; 
 
 
 Ordinary Shares            ordinary shares of 1p 
                             each in the capital of 
                             the Company; 
 
 Placees                    the persons who have 
                             agreed to subscribe for 
                             the Placing Shares; 
 
 Placing                    the placing of the Placing 
                             Shares with the Placees 
                             pursuant to the Placing 
                             Agreement; 
 
 Placing Agreement          the conditional agreement 
                             dated 6 June 2017 between 
                             the Company and Zeus 
                             Capital Limited relating 
                             to the Placing; 
 Placing Price              8 pence per Placing Share; 
 
 
 Placing Shares             62,500,000 new Ordinary 
                             Shares to be issued by 
                             the Company under the 
                             Placing; 
 
 Prospectus Rules           the Prospectus Rules 
                             published by the FCA; 
 
 
 
 Shareholders               holders of Existing Ordinary 
                             Shares; 
 
 
 UK or United Kingdom       the United Kingdom of 
                             England, Scotland, Wales 
                             and Northern Ireland; 
 
 Zeus Capital               Zeus Capital Limited, 
                             a company incorporated 
                             in England and Wales 
                             with registered company 
                             number 4417845; and 
 
 GBP or sterling            pounds sterling, the 
                             legal currency of the 
                             United Kingdom. 
 
 
 

This information is provided by RNS

The company news service from the London Stock Exchange

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June 07, 2017 02:00 ET (06:00 GMT)