Phaunos Timber Fund Limited Response to Stafford Offer & CatchMark Withdrawal (6317B)

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RNS Number : 6317B

Phaunos Timber Fund Limited

24 September 2018

NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, DIRECTLY OR INDIRECTLY (IN WHOLE OR IN PART), IN, INTO OR FROM ANY JURISDICTION WHERE TO DO SO WOULD CONSTITUTE A VIOLATION OF THE RELEVANT LAWS OF THAT JURISDICTION. THIS ANNOUNCEMENT DOES NOT CONSTITUTE A TAKEOVER OFFER OR AN OFFER OF SECURITIES.

24 September 2018

Phaunos Timber Fund Limited ("Phaunos" or the "Company")

Final Offer by Stafford and CatchMark Withdrawal

The board of Phaunos (the "Board") has now reviewed and considered Stafford Capital Partners Limited's ("Stafford") US$0.52 final cash offer for the entire issued and to be issued share capital of the Company (the "Final Offer").

This review was undertaken in conjunction with a review of the status of the ongoing disposal of the Company's asset portfolio under a formal sale process (the "Asset Realisation Process") and taking into account the guidance received from its legal advisers with respect to the Rayonier Canterbury LLC ("Rayonier") dispute.

The Board also notes the withdrawal of CatchMark Timber Trust, Inc.'s ("CatchMark") US$0.57 possible all-stock offer for the entire issued and to be issued share capital of the Company (the "Possible Offer").

Asset Realisation Process

As set out in the chairman's statement for the unaudited interim results of Phaunos published on 7 September 2018, the Asset Realisation Process has now moved into a new phase where bidders are preparing to commence, and in some cases have already commenced, due diligence including site visits, with a view to binding offers being received during Q4 of 2018.

Regarding the assets which are not part of the Asset Realisation Process, negotiations on the possible disposal of the interest in Aurora Forestal are progressing well and various options are being explored to effect an exit. GTFF is currently in the process of realising its portfolio and expressions of interest and / or non-binding bids have been received for all assets in the portfolio.

Taking these factors into account, the Board:

-- reiterates its asset realisation range of US$0.54 - 0.60 per Share (the "Asset Realisation Range"); and

-- continues to believe that the disposal of all the assets which are subject to a sale process under the Asset Realisation Process will complete between Q1 and Q3 2019 which would cover the sale of assets comprising approximately 92% of the Portfolio Value.

Stafford's Final Offer

Phaunos notes that the increased offer from Stafford was made without any prior consultation with the Board as to the level of that Final Offer. The Board notes that the Final Offer is not capable of any further revision.

Taking into account the Asset Realisation Range and the latest estimated timeline for the completion of the Asset Realisation Process, the Board continues to believe that the Final Offer does not provide an attractive exit opportunity for Shareholders.

Accordingly, the Board has unanimously decided to reject the Final Offer from Stafford as it strongly believes that the Final Offer undervalues Phaunos and recommends that you should take no action in relation to the Final Offer and that you should not sign any document which Stafford or its advisers send to you.

CatchMark's Possible Offer

The Board notes that CatchMark, following consultation with Phaunos and its Shareholders, has decided to withdraw its Possible Offer under Rule 2.8 of the UK Takeover Code.

Phaunos notes the statement made by CatchMark in its announcement that under Note 2 of Rule 2.8, CatchMark and any person acting in concert with CatchMark, could reserve the right to set aside the restrictions in Rule 2.8 in the following circumstances: (i) with the agreement of the Board of Phaunos following the firm offer made by Stafford having been withdrawn or having lapsed; (ii) if a third party announces a firm intention to make an offer for Phaunos; (iii) following the announcement by Phaunos of a "whitewash" proposal (as defined in the UK Takeover Code) or a reverse takeover; or (iv) if the UK Panel on Takeovers and Mergers determines that there has been a material change of circumstances.

Unless otherwise stated, defined terms used but not defined in this announcement have the meanings set out in the Response Circular.

Enquiries:

 
 Phaunos Timber Fund Limited 
  Richard Boléat (Chairman)               [phone] 
 Evercore Partners International LLP 
  (Financial Adviser) 
  Julian Oakley 
  Julien Baril                                [phone] 
 Winterflood Investment Trusts (Corporate 
  Broker) 
  Joe Winkley 
  Neil Langford                               [phone] 
 

Rule 26.1 Disclosures

In accordance with Rule 26.1 of the UK Takeover Code, a copy of this announcement will, subject to certain restrictions relating to persons resident in restricted jurisdictions, be available on Phaunos's website at http://www.phaunostimber.com/offer-from-stafford/ by no later than 12 noon (London time) on the business day following the release of this announcement. The content of the website referred to in this announcement is not incorporated into and does not form part of this announcement. The person responsible for arranging for the release of this announcement on behalf of Phaunos is JTC Fund Solutions (Guernsey) Limited (acting as Company Secretary).

Important Notices

This announcement is not intended to, and does not, constitute or form part of any offer, invitation or solicitation of any offer to purchase, otherwise acquire, subscribe for, sell or otherwise dispose of any securities or the solicitation of any vote or approval in any jurisdiction. Any offer (if made) will be made solely by certain offer documentation which will contain the full terms and conditions of any offer (if made), including details of how such offer may be accepted. This announcement has been prepared in accordance with English law and the Code, and information disclosed may not be the same as that which would have been prepared in accordance with laws outside of the United Kingdom. The release, distribution or publication of this announcement in jurisdictions outside of the United Kingdom may be restricted by laws of the relevant jurisdictions, and therefore persons into whose possession this announcement comes should inform themselves about, and observe, any such restrictions. Any failure to comply with the restrictions may constitute a violation of the securities law of any such jurisdiction.

Evercore Partners International LLP ("Evercore"), which is authorised and regulated in the United Kingdom by the Financial Conduct Authority, is acting as financial adviser for Phaunos Timber Fund 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 Phaunos Timber Fund for providing the protections afforded to clients of Evercore, nor for providing advice in relation to any matter referred to herein. Neither Evercore nor any of its subsidiaries, branches or affiliates owes or accepts any duty, liability or responsibility whatsoever (whether direct or indirect, whether in contract or in tort, under statute or otherwise) to any person who is not a client of Evercore in connection with this announcement, any statement contained therein or otherwise. Apart from the responsibilities and liabilities, if any, which may be imposed on Evercore by FSMA, or the regulatory regime established thereunder, or under the regulatory regime of any jurisdiction where exclusion of liability under the relevant regulatory regime would be illegal, void or unenforceable, neither Evercore nor any of its affiliates accepts any responsibility or liability whatsoever for the contents of this announcement, and no representation, express or implied, is made by it, or purported to be made on its behalf, in relation to the contents of this announcement, including its accuracy, completeness or verification of any other statement made or purported to be made by it, or on its behalf, in connection with Phaunos Timber Fund or the matters described in this announcement. To the fullest extent permitted by applicable law, Evercore and its affiliates accordingly disclaim all and any responsibility or liability whether arising in tort, contract or otherwise (save as referred to above) which they might otherwise have in respect of this announcement or any statement contained therein.

Winterflood Securities Limited ("Winterflood"), which is authorised and regulated in the United Kingdom by the Financial Conduct Authority, is acting as corporate broker to Phaunos Timber Fund 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 Phaunos Timber Fund for providing the protections afforded to clients of Winterflood, nor for providing advice in relation to any matter referred to herein.

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September 24, 2018 02:01 ET (06:01 GMT)