BSF Enterprise PLC Conditional Placing to raise GBP1.75 million (5566J)

TIDMBSFA

RNS Number : 5566J

BSF Enterprise PLC

27 April 2022

NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN WHOLE OR IN PART, IN OR INTO THE UNITED STATES, AUSTRALIA, CANADA, JAPAN, THE REPUBLIC OF SOUTH AFRICA, ANY MEMBER STATE OF THE EEA (OTHER THAN THE UNITED KINGDOM) OR ANY OTHER JURISDICTION WHERE TO DO SO WOULD CONSTITUTE A VIOLATION OF THE RELEVANT LAWS OF THAT JURISDICTION.

FURTHER, 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 ANY JURISDICTION.

27 April 2022

BSF Enterprise plc

("BSF" or the "Company")

Conditional Placing to raise GBP1.75 million (before expenses)

Publication of Prospectus

Proposed Waiver of Rule 9 of the Takeover Code

Notice of General Meeting

BSF Enterprise plc (LSE: BSFA), the investment company established to acquire businesses focused on early-stage opportunities in the biotechnology, innovative marketing and e-commerce sectors, is pleased to announce that it has conditionally raised GBP1.75 million (before expenses) (the "Placing") via the proposed issue of 23,744,912 new Ordinary Shares (the "Placing Shares") at a price of 7.37 pence per new Ordinary Share (the "Placing Price") with Placing Warrants attached .

Under the Placing, each Placee will receive one Placing Warrant for every two Placing Shares subscribed for in the Placing and with each Placing Warrant entitling the holder to subscribe for one Ordinary Share at an exercise price of 15p per share at any time up and until the third anniversary of Admission. The Placing Warrants will be freely transferable. In addition, the Company has agreed, conditionally on Admission, to issue the 447,761 Broker Warrants to Shard Capital, which are exercisable at an exercise price of 15p per share at any time up and until the third anniversary of Admission and are non-transferable.

The Placing Shares subscribed for in the Placing at the Placing Price will represent approximately 27.68 per cent. of the Enlarged Share Capital. The Placing is conditional, inter alia, on the Acquisition Agreement becoming unconditional (save as to Admission) and the Resolutions being passed at the General Meeting .

The net placing proceeds are expected to be GBP 1,335,000 and will be used for the following purposes:

   --    lab space and consumables (GBP77,500); 

-- employing additional time from 3DBT's existing professional and technical people (GBP486,000);

   --    employing additional professional and technical people (GBP130,000); 
   --    marketing and sales avenues for the serum free and cosmetics (GBP50,000); and 
   --    general corporate overheads (GBP 871,500 ). 

As announced on 24 December 2021, the Company has entered into a conditional share sale and purchase agreement (the "Acquisition Agreement") to acquire the entire issued share capital of 3D Bio-Tissues Limited ("3DBT") in consideration for the allotment and issue to the Sellers of an aggregate of 33,900,004 Consideration Shares (the "Acquisition"). The Acquisition is conditional, inter alia, on a successful Placing and the passing of the Resolutions at the General Meeting (including the Rule 9 Waiver).

The Company is also proposing to adopt two equity incentive plans:

- Restricted Share Plan. Subject to the passing of Resolution 4 at the General Meeting, the Company will adopt the Restricted Share Plan, which will allow for the grant of shares to selected employees subject to restrictions and forfeiture risks which will be lifted after a certain period. It is intended that participants will be executive directors and senior employees of the Company. No more than 15 per cent. of the issued share capital of the Company from time to time can be issued or issuable under the plan and other grant of shares by the Company which are subject to restrictions and forfeiture risks.

- Employee Share Option Plan ("ESOP"). Subject to the passing of Resolution 5 at the General Meeting the Company proposes to adopt the ESOP, which will allow for the grant of EMI options and non-approved share options. At present, no options to subscribe for Ordinary Shares have been granted under the ESOP. No more than 5 per cent. of the issued share capital of the Company from time to time shall be issued or issuable under the ESOP and other share option arrangements of the Company. At any time, the total market value (at the relevant dates of grant) of the shares that can be acquired on the exercise of all EMI options over the shares will not exceed GBP3 million (or any other amount as may be specified by the legislation governing EMI options at the relevant time).

On Completion, the Company proposes to issue a total of 7,798,491 new Ordinary Shares as Restricted Shares to certain of its directors and certain 3DBT staff as follows:

 
              Name                                 No. of Restricted Shares 
              Professor Che Connon                 3,899,246 
              Dr Ricardo Gouveia      779,849 
              Professor Yu Xiong      779,849 
              Min Yang                             779,849 
              Geoff Baker                          1,559,698 
              Total                                7,798,491 
 

The Restricted Shares to be issued to Professor Che Connon and Dr Ricardo Gouveia will be subject to the rules of the Restricted Share Plan.

The Restricted Shares to be issued to Min Yang, Geoff Baker and Professor Yu Xiong will be subject to the terms and conditions of the Restricted Share Agreements, which are substantially the same as the terms and conditions contained in the rules of the Restricted Share Plan.

None of the Restricted Shares to be issued will be subject to any performance conditions.

The recipients of the Restricted Shares are all members of the Concert Party.

Publication of Prospectus

In connection with the Placing, the Acquisition and Admission, the Company has today received approval from the FCA of its Prospectus relating to the Enlarged Group and has published its Prospectus.

The Prospectus and an electronic copy of the Prospectus has been made available on the Company's website (www.bsfenterprise.com). The Prospectus will also be available for inspection at the National Storage Mechanism website: (https://data.fca.org.uk/#/nsm/nationalstoragemechanism).

Notice of General Meeting

In addition, a circular is being posted today to Shareholders (the "Circular") which sets out in more detail the background and reasons for the Acquisition, the Placing and details of the proposed issue of Restricted Shares, and certain other proposals and also includes a notice of General Meeting.

A General Meeting of the Company is being convened for 10:00 a.m. on 16 May 2022 at the offices of Ince Gordon Dadds LLP, Aldgate Tower, 2 Leman Street, London E1 8QN.

Proposed Waiver of Rule 9 of the Takeover Code

Immediately, upon Admission pursuant to the terms of the Acquisition Agreement and the issue of the Restricted Shares, the Concert Party will hold 56,778,497 Ordinary Shares, representing approximately 66.19 per cent. of the Enlarged Share Capital. Accordingly, the Concert Party would normally be required under Rule 9 of the Code to make a mandatory offer for the remainder of the share capital of the Company. However, the Panel has agreed, subject to the Rule 9 Waiver being approved by Independent Shareholders at the General Meeting, to waive the obligation on the Concert Party, under Rule 9 of the Code, to make an offer for the entire issued share capital of the Company that will arise as a result of issue to the Concert Party of the Consideration Shares and the Restricted Shares.

The Rule 9 Waiver is subject to Independent Shareholder approval at the General Meeting. In order to comply with the Code, the Rule 9 Waiver will be taken on a poll, and require the approval of more than 50 per cent. of votes cast by Independent Shareholders at the General Meeting present in person or by proxy and voting at the General Meeting. The members of the Concert Party will not vote on the Rule 9 Waiver.

As, immediately following Admission, the Concert Party will hold, in aggregate, more than 50 per cent. of the voting rights in in the Company, members of the Concert Party may acquire further interests in the Ordinary Shares of the Company without incurring any obligation under Rule 9 to make a general offer. However, individual members of the Concert Party will not be able to increase their percentage interests in shares through or between a Rule 9 threshold without Panel consent.

Other Resolutions proposed at the General Meeting

In addition to the Rule 9 Waiver, the Company is also proposing resolutions at the General Meeting as follows:

- Resolution 2 (ordinary resolution) to grant the directors general authority to allot shares or grant rights to subscribe for, or convert any security into shares , including in respect of the New Ordinary Shares, the Placing Warrants and the Broker Warrants.

- Resolution 3 (special resolution) to disapply statutory pre-emption rights that would otherwise apply to allotments of shares for cash, including in respect of the New Ordinary Shares, the Placing Warrants and the Broker Warrants.

- Resolution 4 (ordinary resolution) to approve the Restricted Share Plan and its implementation.

   -      Resolution 5 (ordinary resolution) to approve the ESOP and its implementation. 

- Resolution 6 (ordinary resolution) to approve the issue of Restricted Shares to Min Yang and Geoff Baker who are existing directors of the Company.

The full text of the resolutions is set out in the Circular, which will be made available on the Company's website (www.bsfenterprise.com).

Expected Timetable of principle events

 
Publication of Prospectus                          27 April 2022 
Publication and despatch of Circular               27 April 2022 
Latest time and date for receipt of Forms   10.00 a.m. on 12 May 
 of Proxy and CREST Proxy Instructions                      2022 
 for the General Meeting 
Record time for those Shareholders on       10.00 a.m. on 12 May 
 the Register of                                            2022 
 Members entitled to attend or vote at 
 the General Meeting 
General Meeting                             10.00 a.m. on 16 May 
                                                            2022 
Announcement of the result of the General            16 May 2022 
 Meeting 
Completion of the Acquisition                        17 May 2022 
Admission effective and dealing in the       8.00 a.m. on 17 May 
 New Ordinary Shares expected to commence                   2022 
Placing Shares and Consideration Shares              17 May 2022 
 expected to be credited to CREST members' 
 accounts (where applicable) 
 

Note: All references in this announcement are to London times unless otherwise stated. The dates and times given are indicative only and are based on the Company's current expectations and may be subject to change. If any of the times and/or dates above change, the revised times and/or dates will be notified to Shareholders by announcement through a regulatory information service.

Key Statistics

 
Number of Existing Ordinary Shares                    20,340,002 
Number of Consideration Shares to be issued 
 upon Completion                                      33,900,004 
Issue Price of the Consideration Shares               7.37 pence 
Number of Placing Shares                              23,744,912 
Placing Price of the Placing Shares                   7.37 pence 
Number of Placing Warrants to be issued 
 pursuant to the Placing                              11,872,456 
Number of Broker Warrants to be issued 
 pursuant to the Placing                                 447,761 
Number of Restricted Shares                            7,798,491 
Enlarged Share Capital immediately on 
 Admission                                            85,783,409 
Consideration Shares as a percentage of 
 the Enlarged Share Capital immediately 
 on Admission                                             39.52% 
Placing Shares as a percentage of the 
 Enlarged Share Capital immediately on 
 Admission                                                27.68% 
Gross Proceeds of the Placing                      GBP 1,750,000 
Net Proceeds of the Placing                         GBP1,335,000 
New Ordinary Share as a percentage of 
 the Enlarged Share Capital immediately 
 on Admission                                             76.29% 
Market Capitalisation of the Company at       c. GBP6.32 million 
 the Issue Price on Admission 
 

Further announcements will be made in due course, as appropriate.

Enquiries:

 
 BSF Enterprise plc 
 Geoff Baker                  Tel: [phone] 
 Shard Capital Partners LLP 
 Damon Heath                  Tel: [phone] 
 

For further information, please visit www.bsfenterprise.com.

LEI: 2138007PJT69H8FYLC06

This announcement contains inside information for the purposes of Article 7 of the UK version of Market Regulation (EU) No 596/2014 on Market Abuse as it forms part of UK domestic law by virtue of the

European Union (Withdrawal) Act 2018, as amended ("MAR"). Upon the publication of this announcement via Regulatory Information Service, this inside information is now considered to be in the public domain.

DISCLAIMER

Shard Capital Partners LLP ("Shard Capital"), which is authorised and regulated in the United Kingdom by the Financial Conduct Authority (FRN: 538762), is acting as broker to the Company in relation to the Placing. Persons receiving this announcement should note that Shard Capital will not be responsible to anyone other than the Company for providing the protections afforded to its clients or for advising any other person on the arrangements described in this announcement. Shard Capital has not authorised the contents of, or any part of, this announcement and no liability whatsoever is accepted by it for the accuracy of any information or opinion contained in this announcement or for the omission of any information.

This announcement includes statements that are, or may be deemed to be, "forward-looking statements". These forward-looking statements can be identified by the use of forward-looking terminology, including the terms "believes", "estimates", "plans", "anticipates", "targets", "aims", "continues", "expects", "intends", "hopes", "may", "will", "would", "could" or "should" or, in each case, their negative or other variations or comparable terminology. These forward-looking statements include matters that are not facts. They appear in a number of places throughout this announcement and include statements regarding the Directors' beliefs or current expectations concerning, amongst other things, the amount of capital which will be returned by the Company and the taxation of such amounts in the hands of Shareholders. By their nature, forward-looking statements involve risk and uncertainty because they relate to future events and circumstances. Investors should not place undue reliance on forward-looking statements, which speak only as of the date of this announcement.

The information given in this announcement and the forward-looking statements speak only as at the date of this announcement. The Company, Shard Capital and their respective affiliates expressly disclaim any obligation or undertaking to update, review or revise any forward-looking statement contained in this announcement to reflect actual results or any change in the assumptions, conditions or circumstances on which any such statements are based unless required to do so by the Financial Services and Markets Act 2000, the Listing Rules, the Prospectus Regulation Rules or other applicable laws, regulations or rules.

The Existing Ordinary Shares and the New Ordinary Shares have not, nor will they be, registered under the US Securities Act of 1933, as amended (the "US Securities Act") or with any securities regulatory authority of any state or other jurisdiction of the United States or under the applicable securities laws of Australia, Canada, Japan or the Republic of South Africa. The Existing Ordinary Shares and the New Ordinary Shares to be issued by the Company may not be offered or sold directly or indirectly in or into the United States unless registered under the US Securities Act or offered in a transaction exempt from or not subject to the registration requirements of the US Securities Act or subject to certain exceptions, into Australia, Canada, Japan or the Republic of South Africa or to, or for the account or benefit of, any national, resident or citizen of Australia, Canada, Japan or the Republic of South Africa. The Company has not been, and will not be, registered under the US Investment Company Act of 1940, as amended.

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. Any failure to comply with these restrictions may constitute a violation of the securities laws of any such jurisdiction.

The value of shares and the income from them is not guaranteed and can fall as well as rise due to stock market and currency movements. When you sell your investment you may get back less than you originally invested. All of the value of an investor's investment in the Company will be at risk. Past performance is not a guide to future performance and the information in this circular or any documents relating to the matters described in it cannot be relied upon as a guide to future performance. Persons needing advice should contact a professional adviser.

DEFINITIONS

 
 Acquisition                        the proposed acquisition by the Company 
                                     of the entire issued share capital 
                                     of 3DBT pursuant to the terms of the 
                                     Acquisition Agreement; 
 Acquisition Agreement              means the conditional agreement dated 
                                     23 December 2021 made between the Company 
                                     and the Sellers relating to the Acquisition 
                                     ; 
 Admission                          means the re-admission of the Existing 
                                     Ordinary Shares and the admission of 
                                     the New Ordinary Shares to the Official 
                                     List by way of a Standard Listing and 
                                     to trading on the London Stock Exchange's 
                                     Main Market for listed securities; 
 Broker Warrants                    the 447,761 warrants to subscribe Ordinary 
                                     Shares at the price of 15p per share 
                                     being granted by the Company to Shard 
                                     Capital conditionally on Admission 
                                     in connection with the Placing; 
 City Code                          the City Code on Takeovers and Mergers; 
 Company                            means BSF Enterprise plc, a company 
                                     incorporated in England & Wales whose 
                                     registered office address is at C/o 
                                     Locke Lord (UK) LLP, 201 Bishopsgate, 
                                     London EC2M 3AB with company number 
                                     11554014; 
 Completion                         means completion of the Acquisition; 
 Concert Party                      the concert party for the purposes 

                                     of the City Code, comprising the Sellers 
                                     and certain existing Shareholders, 
                                     as more particularly described in the 
                                     Circular; 
 Consideration Shares               means the 33,900,004 new Ordinary Shares 
                                     to be issued and allotted to the Sellers 
                                     at the Placing Price pursuant to the 
                                     terms of the Acquisition Agreement; 
 Directors, Board or Board          means the current directors of the 
  of Directors                       Company or the board of directors from 
                                     time to time of the Company, as the 
                                     context requires, and "Director" is 
                                     to be construed accordingly; 
 Enlarged Group                     means, with effect from Completion, 
                                     the Company and 3DBT; 
 Enlarged Share Capital             the share capital of the Company after 
                                     Admission, comprising the Existing 
                                     Ordinary Shares and the New Ordinary 
                                     Shares; 
 ESOP                               means the employee share option plan 
                                     proposed to be adopted by the Company 
                                     ; 
 Existing Directors                 means Min Yang, Geoffrey Robert Baker 
                                     and Dennis Ow; 
 Existing Ordinary Shares           means the 36,900,000 Ordinary Shares 
                                     of GBP0.01 each in issue as at the 
                                     date of this announcement; 
 FCA                                means the UK Financial Conduct Authority; 
 FSMA                               means the UK Financial Services and 
                                     Markets Act 2000, as amended; 
 GBP, pounds sterling or            means British pounds sterling; 
  GBP 
 General Meeting                    the general meeting of the Company, 
                                     to be held at the offices of Ince Gordon 
                                     Dadds LLP, Aldgate Tower, 2 Leman Street, 
                                     London E1 8QN at 10.00 a.m. on 16 May 
                                     2022, or any adjournment thereof ; 
 Independent Director               Dennis Ow; 
 Independent Shareholders           all Shareholders with the exception 
                                     of the members of the Concert Party; 
 Listing Rules                      means the listing rules made by the 
                                     FCA under section 73A of FSMA as amended 
                                     from time to time; 
 London Stock Exchange              means London Stock Exchange plc; 
 Main Market                        means the main market for listed securities 
                                     of the London Stock Exchange; 
 Market Abuse Regulation or         the UK version of the EU Market Abuse 
  MAR                                Regulation (2014/596/EU) (incorporated 
                                     into UK law by virtue of the EUWA) 
                                     and the relevant provisions of the 
                                     EU Market Abuse Regulation (2014/596/EU); 
 New Ordinary Shares                means the Placing Shares, the Consideration 
                                     Shares and the Restricted Shares; 
 Official List                      means the official list maintained 
                                     by the FCA; 
 Ordinary Shares                    means the ordinary shares of GBP0.01 
                                     each in the capital of the Company 
                                     including, if the context requires, 
                                     the New Ordinary Shares; 
 Panel                              the Panel on Takeovers and Mergers; 
 Placing                            means the proposed placing of the New 
                                     Ordinary Shares by the Company at the 
                                     Placing Price, conditional inter alia 
                                     on Admission; 
 Placing Price                      means 7.37 pence per New Ordinary Share; 
 Placing Shares                     means the 23,744,912 new Ordinary Shares 
                                     proposed to be issued and allotted 
                                     pursuant to the Placing; 
 Placing Warrants                   means the 11,872,456 warrants to subscribe 
                                     new Ordinary Shares at 15p per share 
                                     being granted by the Company to Placees 
                                     conditionally on Admission; 
 Proposed Director                  means Professor Che John Connon; 
 Prospectus                         means the prospectus relating to the 
                                     Acquisition, the Placing, Admission 
                                     and the Enlarged Group; 
 Prospectus Regulation Rules        the Prospectus Regulation Rules made 
                                     by the FCA under Part VI of the FSMA; 
 Resolutions                        means the resolutions to be put to 
                                     the Shareholders at the General Meeting 
                                     as set out in the Notice of General 
                                     Meeting; 
 Restricted Share Agreements        the agreements between the Company 
                                     and each of Min Yang, Geoff Baker and 
                                     Professor Yu Xiong dated 26 April 2022 
                                     pursuant to which the Company has conditionally 
                                     agreed to award Restricted Shares to 
                                     each of Min Yang, Geoff Baker and Professor 
                                     Yu Xiong; 
 Restricted Share Award Agreement   the agreements dated 26 April 2022 
                                     between the Company and Professor Che 
                                     Connon and Dr Ricardo Gouveia pursuant 
                                     to which the Company has conditionally 
                                     agreed to award Restricted Shares to 
                                     such persons under the Restricted Share 
                                     Plan; 
 Restricted Shares                  the new Ordinary Shares to be issued 
                                     on Admission under the Restricted Share 
                                     Plan and pursuant to the Restricted 
                                     Share Agreements; 
 Restricted Share Plan              means the restricted share plan proposed 
                                     to be adopted by the Company; 
 Reverse Takeover                   means a reverse takeover as defined 
                                     in the Listing Rules; 
 Rule 9 Waiver                      means the resolution numbered set out 
                                     in the Notice of General Meeting, for 
                                     the Independent Shareholders to approve, 
                                     on a poll, the Panel's agreement to 
                                     waive any obligation on any member 
                                     of the Concert Party to make a general 
                                     offer to Shareholders pursuant to Rule 
                                     9 that would otherwise arise as a result 
                                     of the issue of the Consideration Shares 
                                     and the Restricted Shares; 
 Securities Act                     means the U.S. Securities Act of 1933, 
                                     as amended; 
 Sellers                            means Professor Che Connon, Dr Ricardo 
                                     Gouveia, Newcastle University Holdings 
                                     Limited and BSF Angel Funding Limited, 
                                     being together all of the Sellers of 
                                     the entire issued share capital of 
                                     3DB T pursuant to the Acquisition Agreement; 
 Shard Capital                      Shard Capital Partners LLP, which is 
                                     authorised and regulated in the United 
                                     Kingdom by the Financial Conduct Authority 
                                     (FRN: 538762); 
 Shareholders                       means the holders of Ordinary Shares; 
 Standard Listing                   means a standard listing under Chapter 
                                     14 of the Listing Rules; 
 United Kingdom or U.K.             means the United Kingdom of Great Britain 
                                     and Northern Ireland; 
 United States or U.S.              means the United States of America; 
 

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April 27, 2022 07:07 ET (11:07 GMT)