Micro Focus International plc Posting of Circular and Notice of General Meeting (5768U)

TIDMMCRO

RNS Number : 5768U

Micro Focus International plc

01 April 2019

NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN WHOLE OR IN PART, IN, INTO OR FROM ANY JURISDICTION WHERE TO DO SO WOULD CONSTITUTE A VIOLATION OF THE RELEVANT LAWS OR REGULATIONS OF SUCH JURISDICTION

1 April 2019

Micro Focus International plc

Proposed Return of Value of the pounds sterling equivalent of US$1.8 billion

0.8296 Share Capital Consolidation

Posting of Circular and Notice of General Meeting

Further to the announcement by Micro Focus International plc ("Micro Focus" or "the Company" or "the Group", LSE: MCRO.L, NYSE: MFGP) on 15 March 2019 relating to the completion of the disposal of the SUSE business (the "Disposal"), Micro Focus announces today a proposed return of value of an aggregate amount in pounds sterling equivalent to US$1.8 billion (the "Return of Value") to holders of its Ordinary Shares and American Depositary Shares representing Ordinary Shares ("ADSs") by way of a B Share Scheme. This is in addition to the US$510 million of share buy-backs undertaken since August 2018. Micro Focus has also determined that a debt repayment of US$200 million will be made shortly.

Based on the current number of ordinary shares in issue (excluding shares held in treasury) of 410,386,596, the Return of Value will equate to the pounds sterling equivalent of approximately $4.33 to $4.39 per Ordinary Share, depending on the number of Ordinary Shares being issued pursuant to the Micro Focus Share Plans between the date of this announcement and the B Share Scheme Record Time. It is expected that the exchange rate to be used for the Return of Value will be announced by 7.00 a.m. on 26 April 2019 and that completion of the B Share Scheme will occur on 29 April 2019, with settlement taking place during May.

Micro Focus will also effect a Share Capital Consolidation and an equivalent consolidation of the ADSs in connection with the B Share Scheme in order that the market price for Ordinary Shares and ADSs is not materially affected by the implementation of the B Share Scheme. Shareholders will receive 0.8296 New Ordinary Shares for each Existing Ordinary Share held at the B Share Scheme Record Time, this ratio being set by reference to the average closing mid-market price (as derived from the daily official list of London Stock Exchange plc) for the five Business Days prior to the date of this announcement and an exchange rate of US$1.00:GBP0.7679 (being the Bloomberg FX Fixings closing spot exchange rate at 4.30 p.m. (UK time) on 29 March 2019).The Share Capital Consolidation is conditional upon Admission and is expected to take effect at 8.00 a.m. (UK time) on 30 April 2019, in respect of the Ordinary Shares and 9.30 a.m. (New York City time) on 30 April 2019 in respect of the ADSs, the Business Day following the redemption of the B Shares.

The Return of Value and associated Share Capital Consolidation require the approval of Micro Focus shareholders by way of special resolution. The Circular relating to the Return of Value is now available to view on Micro Focus' website (www.microfocus.com). A hard copy of the Circular and Form of Proxy will be posted to Micro Focus shareholders shortly, containing further details of the Return of Value and Share Capital Consolidation and containing a notice convening a General Meeting on 29 April 2019 at 9.00 a.m. at Numis Securities Limited, 10 Paternoster Square, London EC4M 7LT.

Expected timetable of events:*

 
 Voting record date for ADS Holders                         25 March 2019 
 Posting and publication of the Circular and                1 April 2019 
  Notice of General Meeting 
 Latest time for receipt of ADS proxy instructions          11.59 p.m. (New 
  by telephone and internet                                  York City time) 
                                                             on 17 April 2019 
 Latest time for receipt of ADS proxy cards                 10.00 a.m. (New 
                                                             York city time) 
                                                             on 18 April 2019 
 Latest time and date for receipt of Forms of               9.00 a.m. on 25 
  Proxy, electronic proxy voting and CREST Proxy             April 2019 
  Instructions from Ordinary Shareholders for 
  the General Meeting 
 Announcement of US$/GBP exchange rate for Return           by 7.00 a.m. on 
  of Value                                                   26 April 2019 
 General Meeting                                            9.00 a.m. on 29 
                                                             April 2019 
 Latest time and date for dealings in Existing                6.00 p.m. on 29 
  Ordinary Shares, Existing Ordinary Share register              April 2019 
  closed and Existing Ordinary Shares disabled 
  in CREST 
 Record Time for B Share Scheme and Share Capital           6.00 p.m. on 29 
  Consolidation in respect of Existing Ordinary              April 2019 
  Shares 
 B Shares issued                                            7.00 p.m. on 29 
                                                             April 2019 
 Latest time and date for dealings in ADSs, ADS             4.00 p.m. (New York 
  register closed and ADSs disabled for transfer             City time) on 29 
                                                             April 2019 
 Effective B Share Scheme record time for ADSs              4.00 p.m. (New York 
                                                             City time) on 29 
                                                             April 2019 
 B Shares redeemed                                          11.59 p.m. on 29 
                                                             April 2019 
 Share Capital Consolidation effected and New               8.00 a.m. on 30 
  Ordinary Shares admitted to the premium segment            April 2019 
  of the Official List and to trading on the Main 
  Market for listed securities 
 Effective time of ADS consolidation and commencement       9.30 a.m. (New York 
  of trading in New ADSs                                     City time) on 30 
                                                             April 2019 
 Despatch of cheques or CREST accounts credited             by 13 May 2019 
  (as appropriate) in respect of Existing Ordinary 
  Shares for the proceeds of the redemption of 
  the B Shares and, where applicable, despatch 
  of cheques or CREST accounts credited in respect 
  of Existing Ordinary Shares for fractional entitlements 
  arising from the Share Capital Consolidation 
 Despatch of share certificates and ADRs in respect         by 13 May 2019 
  of New Ordinary Shares and New ADSs 
 DTC accounts credited to ADSs held electronically          by 20 May 2019 
  for the proceeds of the redemption of the B 
  Shares and, where applicable, fractional entitlements 
  arising from the Share Capital Consideration 
 Despatch of cheques to ADS Holders or credit               by 20 May 2019 
  of proceeds to ADSs held in book-entry form 
  (as appropriate) for the proceeds of the redemption 
  of the B Shares and, where applicable, despatch 
  of cheques to ADS Holders or credit of proceeds 
  to ADSs held in book-entry form (as appropriate) 
  for fractional entitlements arising from the 
  Share Capital Consolidation 
 

* References to times in this announcement are to London time unless otherwise stated.

Settlement

Shareholders will receive their proceeds under the Return of Value in pounds sterling other than the ADS Holders whose proceeds will be converted into US dollars by the Depositary, having regard to the prevailing exchange rate at the time of conversion, which is expected to be on the B Share Scheme Payment Date for the Ordinary Shares.

Under the expected timetable of events, shareholders entitled to receive payments in respect of the proceeds from the B Share Scheme will be sent cheques or, if shareholders hold their Existing Ordinary Shares in CREST or ADSs through DTC, will have their CREST or DTC accounts credited, as applicable, by the B Share Scheme Payment Date, which is currently expected to be on or before 13 May 2019 in respect of Ordinary Shares and, in order to allow for the conversion from pounds sterling to US dollars by the Depositary, on or before 20 May 2019 in respect of the ADSs.

The ISIN of the Existing Ordinary Shares is GB00BD8YWM01 and the ADSs is US5948373049. Following the completion of the Return of Value and Share Capital Consolidation completes, the ISIN of the New Ordinary Shares will be GB00BJ1F4N75 and the New ADSs will be US5948374039.

General Meeting

The resolution to approve the B Share Scheme and to amend the Company's articles of association will be proposed at the General Meeting as a special resolution, the passing of which requires at least 75 per cent. of the shares voted (whether in person or by proxy) to be cast in favour.

Copies of the Circular may be inspected free of charge at Micro Focus' website (www.microfocus.com) and will be made available for inspection during business hours on any weekday (Saturdays, Sundays and bank holidays excepted) at the offices of Travers Smith LLP, 10 Snow Hill, London EC1A 2AL up to and including 29 April 2019 and will also be available for inspection at the General Meeting for at least fifteen minutes prior to and during the General Meeting.

A copy of the Circular will also be submitted to the National Storage Mechanism, where it will shortly be available for inspection at www.morningstar.co.uk/uk/NSM.

This preceding summary should be read in conjunction with the full text of the Circular.

 
 
  For further information, please contact: 
 
  Enquiries:                                                    Tel: [phone] 
    Micro Focus 
 
    Kevin Loosemore, Executive Chairman 
 
    Stephen Murdoch, Chief Executive Officer 
 
    Brian McArthur-Muscroft, Chief Financial 
    Officer 
 
    Tim Brill, IR Director 
 
   Numis (Corporate Broker and Financial Adviser)     Tel: [phone] 
                                                       1000 
 
    Simon Willis 
 
    Tom Ballard 
 
    Jonathan Abbott 
 
   Powerscourt                                        Tel: [phone] 
                                                       1446 
 
    Elly Williamson 
 
    Celine MacDougall 
 

Definitions

 
 Admission                     the admission of the New Ordinary 
                                Shares to the premium listing segment 
                                of the Official List becoming effective 
                                in accordance with the Listing Rules 
                                and to trading on the London Stock 
                                Exchange's main market for listed 
                                securities becoming effective in accordance 
                                with the Admission and Disclosure 
                                Standards and listing of the New ADSs 
                                on the NYSE, as applicable; 
 B Share Scheme                the proposed transactions comprising 
                                the return of value by way of the 
                                issuance of the B Shares, the redemption 
                                of the B Shares and the Share Capital 
                                Consolidation; 
 B Share Scheme Payment        on or before 13 May 2019 in respect 
  Date                          of Ordinary Shares and on or before 
                                20 May 2019 in respect of ADSs (in 
                                each case, or such other dates as 
                                the Directors in their absolute discretion 
                                may determine but being, in any event, 
                                dates within 25 days of the Admission), 
                                being the dates on which the redemption 
                                proceeds in respect of the B Share 
                                Scheme will be sent to relevant shareholders; 
 B Share Scheme Record         6.00 p.m. on 29 April 2019 (or such 
  Time                          other date as the Directors in their 
                                absolute discretion may determine); 
 Business Day                  any day other than a Saturday, Sunday 
                                or public holiday in England and Wales 
                                or, where the context requires, New 
                                York City; 
 CREST                         the system of paperless settlement 
                                of trades in securities and the holding 
                                of uncertificated securities operated 
                                by Euroclear UK and Ireland Limited 
                                in accordance with the Uncertificated 
                                Securities Regulations 2001; 
 Depositary                    Deutsche Bank Trust Company Americas; 
 Directors                     the directors of the Company; 
 DTC                           The Depository Trust Company; 
 General Meeting               the general meeting of the Company 
                                to be held at Numis Securities Limited, 
                                10 Paternoster Square, London EC4M 
                                7LT at 9.00 a.m. on 29 April 2019, 
                                or any adjournment thereof, to consider 
                                and, if thought fit, approve the Resolution, 
                                notice of which is set out at the 
                                end of this Circular; 
 Micro Focus Share Plans       the Micro Focus Incentive Plan 2005, 
                                the Micro Focus Sharesave Plan 2006, 
                                the Micro Focus Employee Stock Purchase 
                                Plan 2006, the Seattle Spinco, Inc 
                                2017 Share Incentive Plan, the Micro 
                                Focus Deferred Share Bonus Plan and 
                                the Micro Focus Additional Share Grant 
                                Programme; 
 New ADSs                      the American Depositary Shares representing 
                                New Ordinary Shares following the 
                                Share Capital Consolidation; 
 New Ordinary Shares           the ordinary shares of 10 pence each 
                                in the capital of the Company to be 
                                created as a result of the Share Capital 
                                Consolidation; 
 Ordinary Shares               the ordinary shares of 10 pence each 
                                in the share capital of the Company; 
 Share Capital Consolidation   the proposed consolidation, subdivision 
                                and redesignation of Micro Focus' 
                                share capital in connection with the 
                                Return of Value; and. 
 Shareholders                  the holders of Ordinary Shares or 
                                ADSs, as applicable, from time to 
                                time and, where the context so requires, 
                                holders of B Shares and/or Deferred 
                                Shares. 
 

IMPORTANT NOTICE

This announcement has been issued by and is the sole responsibility of Micro Focus. This announcement introduces the proposals contained in the Circular, which should be read by shareholders before taking a decision. The announcement is not a summary of the proposals and should not be regarded as a substitute for reading the Circular.

This announcement is not intended to, and does not, constitute or form part of any offer, invitation or the solicitation of an offer to purchase, otherwise acquire, subscribe for, sell or otherwise dispose of, any securities pursuant to this announcement or otherwise.

This announcement has been prepared in accordance with English law, the EU Market Abuse Regulation and the Disclosure Guidance and Transparency Rules of the UKLA and information disclosed may not be the same as that which would have been prepared in accordance with the laws of jurisdictions outside England.

The release, publication or distribution of this announcement in, into or from jurisdictions outside the United Kingdom may be restricted by law and therefore persons into whose possession this announcement comes should inform themselves about, and observe such restrictions. Any failure to comply with the restrictions may constitute a violation of the securities law of any such jurisdiction.

This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact [e-mail] or visit www.rns.com.

END

MSCWGUCPWUPBGMG

(END) Dow Jones Newswires

April 01, 2019 02:00 ET (06:00 GMT)