TIDMKORS TIDMCHOO TIDMKORS
RNS Number : 2602U
Michael Kors Holdings Limited
20 October 2017
Second financing update
Michael Kors Holdings Limited
NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION IN, INTO OR FROM
ANY JURISDICTION WHERE TO DO SO WOULD CONSTITUTE A VIOLATION OF THE
RELEVANT LAWS OR REGULATIONS OF SUCH JURISDICTION
FOR IMMEDIATE RELEASE
20 October 2017
RECOMMED CASH ACQUISITION
of
JIMMY CHOO PLC
by
MICHAEL KORS HOLDINGS LIMITED
to be effected
by means of a Scheme of Arrangement
under Part 26 of the Companies Act 2006
SECOND FINANCING UPDATE
On 25 July 2017, Jimmy Choo PLC ("Jimmy Choo") and Michael Kors
Holdings Limited ("Michael Kors") announced that they had reached
agreement on the terms of a recommended cash acquisition by which
the entire issued and to be issued ordinary share capital of Jimmy
Choo will be acquired by JAG Acquisitions (UK) Limited ("Michael
Kors Bidco"), a wholly-owned subsidiary of Michael Kors (the
"Acquisition"). The Acquisition is to be effected by means of a
Court approved scheme of arrangement under Part 26 of the Companies
Act 2006 (the "Scheme"). On 21 August 2017, the scheme document in
relation to the Scheme (the "Scheme Document") was published by
Jimmy Choo. On 23 August 2017, Michael Kors published a financing
update announcement stating that it has entered into a $1 billion
Term Loan Credit Facility and that its commitments under the Bridge
Credit Agreement were accordingly reduced to GBP344,189,745.19.
On 5 October 2017, Michael Kors (USA), Inc. (the "Issuer"), a
Delaware corporation and subsidiary of Michael Kors, announced the
pricing of an offering of 4.000% senior notes (the "Senior Notes")
with an aggregate principal amount of $450.0 million (the "Bond
Offering") pursuant to an offering memorandum and subject to
applicable securities laws restrictions.
Michael Kors Bidco intends to use the proceeds from the Bond
Offering and borrowings under the Term Loan Credit Facility and
cash on hand to finance the cash consideration payable by Michael
Kors Bidco to Scheme Shareholders and the fees and expenses
associated with the transaction. Accordingly, as of 20 October
2017, the commitments under the Bridge Credit Agreement have been
reduced to zero.
Pursuant to the terms of the Bond Offering, the Senior Notes
will mature on November 1, 2024 and will bear interest at a rate of
4.000% per annum, subject to adjustment from time to time if either
Moody's or S&P (or a substitute rating agency therefor)
downgrades (or downgrades and subsequently upgrades) the credit
rating assigned to the Senior Notes. The Issuer will pay interest
on the Senior Notes semi-annually in cash in arrears on May 1 and
November 1 of each year, beginning on May 1, 2018.
The Issuer may redeem some or all of the Senior Notes at any
time at the applicable redemption price. Upon the occurrence of a
change of control triggering event, the Issuer will be required to
make an offer to repurchase the Senior Notes at a price equal to
101% of their principal amount, plus accrued and unpaid interest
to, but not including, the date of repurchase.
The Senior Notes will be guaranteed on a senior, unsecured basis
by Michael Kors and all of Michael Kors' existing and future
subsidiaries that guarantee or are borrowers under the Term Loan
Credit Facility (except for subsidiaries organized in China and
certain other exceptions), including, following (and conditional
upon) the Scheme becoming effective, Jimmy Choo and all of its
existing and future subsidiaries who are guarantors or borrowers
under the Term Loan Credit Facility (except for subsidiaries
organized in China and certain other exceptions).
Michael Kors has entered into a forward contract with JPMorgan
Chase Bank, N.A. for delivery of sterling in the amount of $1.45
billion. The forward contract will enable Michael Kors to convert
its US dollar borrowings under the Term Loan Credit Facility and
the proceeds of the Bond Offering into the sterling funds required
to fund the cash consideration payable to Scheme Shareholders under
the terms of the Acquisition.
A copy of the Current Report on Form 8-K announcing the launch
of the Bond Offering, filed with the Securities Exchange Commission
on October 5, 2017, is available at
http://investors.michaelkors.com.
Unless the context otherwise requires, terms used in this
announcement (the "Announcement") have the same meanings as those
used in the Scheme Document and the financing update announcement
published by Michael Kors on 23 August 2017.
Senior Notes have not been, and will not be, registered under
the Securities Act of 1933, and may not be offered or sold in the
United States absent registration or an applicable exemption from
such registration.
Enquiries:
Michael Kors
Christina Coronios +1 201 691 6133
InvestorRelations@MichaelKors.com
ICR, Inc.
Jean Fontana (investor relations) +1 203 682 8200
jean.fontana@icrinc.com
Alecia Pulman (media) +1 646 277 1231
KorsPR@icrinc.com
Goldman Sachs (lead financial adviser to Michael Kors)
David Friedland +1 212 902 1000
Jennifer Davis
Nick Harper +44 (0) 20 7774 1000
J.P. Morgan (financial adviser to Michael Kors)
Nikolas Johnston +1 212 270 6000
Lorenzo Colonna di Paliano
Dwayne Lysaght +44 (0) 207 742 4000
Adam Laursen
Further information
This Announcement is for information purposes only and does not
constitute, or form part of, an offer, invitation or the
solicitation of an 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, pursuant
to the Acquisition or otherwise, nor shall there be any sale,
issuance or transfer of securities of Jimmy Choo in any
jurisdiction in contravention of applicable law. The Acquisition
will be made solely by means of the Scheme Document or Offer
Document or any document by which the Acquisition is made, which
will contain the full terms and conditions of the Acquisition.
Please be aware that addresses, electronic addresses and certain
other information provided by Jimmy Choo Shareholders, persons with
information rights and other relevant persons for the receipt of
communications from Jimmy Choo may be provided to Michael Kors
Bidco during the offer period as required under Section 4 of
Appendix 4 of the City Code to comply with Rule 2.11(c).
Goldman Sachs, which is authorised by the PRA and regulated by
the FCA and the PRA in the UK, is acting exclusively for Michael
Kors and Michael Kors Bidco in connection with the matters set out
in this Announcement and for no one else and will not regard any
other person as its client in relation to the Acquisition and the
other matters referred to in this Announcement and will not be
responsible to anyone other than Michael Kors and Michael Kors
Bidco for providing the protections afforded to clients of Goldman
Sachs or for providing advice in connection with the Acquisition
and any other matter referred to in this Announcement.
J.P. Morgan Securities LLC, together with its affiliate J.P.
Morgan Securities plc (which conducts its UK investment banking
business as J.P. Morgan Cazenove and which is authorised in the
United Kingdom by the PRA and regulated in the United Kingdom by
the PRA and the FCA) ("J.P. Morgan"), is acting exclusively for
Michael Kors and Michael Kors Bidco in connection with the matters
set out in this Announcement and for no one else and will not be
responsible to anyone other than Michael Kors and Michael Kors
Bidco for providing the protections afforded to their clients, or
for giving advice in connection with any matter referred to in this
Announcement.
Overseas jurisdictions
The release, publication or distribution of this Announcement in
certain jurisdictions may be restricted by law. Persons who are not
resident in the United Kingdom or who are subject to other
jurisdictions should inform themselves of, and observe, any
applicable requirements. Any failure to comply with the applicable
restrictions may constitute a violation of the securities laws of
any such jurisdiction. To the fullest extent permitted by
applicable law, the companies and persons involved in the
Acquisition disclaim any responsibility or liability for the
violation of such restrictions by any person. This Announcement has
been prepared for the purposes of complying with English law, the
rules of the London Stock Exchange, the Listing Rules and the City
Code and the information disclosed may not be the same as that
which would have been disclosed if this Announcement had been
prepared in accordance with the laws of jurisdictions outside of
England and Wales.
Unless otherwise determined by Michael Kors Bidco or required by
the City Code, and permitted by applicable law and regulation, the
Acquisition will not be made available, directly or indirectly, in,
into or from a Restricted Jurisdiction where to do so would violate
the laws in that jurisdiction. Accordingly, copies of this
Announcement and all documents relating to the Acquisition are not
being, and must not be, directly or indirectly, mailed or otherwise
forwarded, distributed or sent in, into or from a Restricted
Jurisdiction where to do so would violate the laws in that
jurisdiction, and persons receiving this Announcement and all
documents relating to the Acquisition (including custodians,
nominees and trustees) must not mail or otherwise distribute or
send them in, into or from such jurisdictions where to do so would
violate the laws in that jurisdiction.
The availability of the Acquisition to Jimmy Choo Shareholders
who are not resident in the United Kingdom may be affected by the
laws of the relevant jurisdictions in which they are resident.
Persons who are not resident in the United Kingdom should inform
themselves of, and observe, any applicable requirements.
Additional information for US investors
The Acquisition relates to the shares of an English company and
is proposed to be effected by means of a scheme of arrangement
under the laws of England and Wales. Neither the proxy solicitation
rules nor the tender offer rules under the US Securities Exchange
Act of 1934, as amended (the "US Exchange Act"), will apply to the
Acquisition. Moreover, the Acquisition is subject to the disclosure
requirements and practices applicable in the United Kingdom and
under the City Code to schemes of arrangement, which differ from
the disclosure requirements of the US proxy solicitation rules and
tender offer rules. Financial information included in this
Announcement has been prepared, unless specifically stated
otherwise, in accordance with accounting standards applicable in
the UK and thus may not be comparable to the financial information
of US companies or companies whose financial statements are
prepared in accordance with generally accepted accounting
principles in the US.
It may be difficult for US holders of Jimmy Choo Shares to
enforce their rights and claims arising out of the US federal
securities laws, since Michael Kors, Michael Kors Bidco and Jimmy
Choo are located in countries other than the United States, and
some or all of their officers and directors may be residents of
countries other than the United States. US holders of Jimmy Choo
Shares may not be able to sue a non-US company or its officers or
directors in a non-US court for violations of the US securities
laws. Further, it may be difficult to compel a non-US company and
its affiliates to subject themselves to a US court's judgement.
The receipt of cash pursuant to the Acquisition by a US holder
as consideration for the transfer of its Scheme Shares pursuant to
the Scheme will likely be a taxable transaction for United States
federal income tax purposes and potentially under any applicable
United States state or local, as well as foreign and other, tax
laws. Each Jimmy Choo Shareholder is urged to consult his or her
independent professional adviser immediately regarding the tax
consequences of the Acquisition applicable to him or her.
Forward-looking statements
This Announcement (including information incorporated by
reference in this Announcement), oral statements made regarding the
Acquisition, and other information published by Michael Kors,
Michael Kors Bidco and Jimmy Choo contain statements which are, or
may be deemed to be, "forward-looking statements". Forward-looking
statements are prospective in nature and are not based on
historical facts, but rather on current expectations and
projections of the management of Michael Kors, Michael Kors Bidco
and Jimmy Choo about future events, and are therefore subject to
risks and uncertainties which could cause actual results to differ
materially from the future results expressed or implied by the
forward-looking statements. The forward-looking statements
contained in this Announcement include statements relating to the
expected effects of the Acquisition on Michael Kors, Michael Kors
Bidco and Jimmy Choo, the expected timing and scope of the
Acquisition and other statements other than historical facts. 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", "should", "could", "would", "may",
"anticipates", "estimates", "synergy", "cost-saving", "projects",
"goal", "strategy", "budget", "forecast" or "might", or words or
terms of similar substance or the negative thereof, are
forward-looking statements. Forward-looking statements include
statements relating to the following: (i) future capital
expenditures, expenses, revenues, earnings, economic performance,
indebtedness, financial condition, dividend policy, losses and
future prospects; (ii) business and management strategies and the
expansion and growth of Jimmy Choo's and Michael Kors' operations
and benefits from the Acquisition; and (iii) the effects of
government regulation on Michael Kors', Michael Kors Bidco's or
Jimmy Choo's business.
These forward-looking statements are not guarantees of future
financial performance. Except as expressly provided in this
Announcement, they have not been reviewed by the auditors of
Michael Kors or Jimmy Choo or their respective financial advisers.
Such forward-looking statements involve known and unknown risks and
uncertainties that could significantly affect expected results and
are based on certain key assumptions. Many factors could cause
actual results to differ materially from those projected or implied
in any forward-looking statements. These factors include the
satisfaction of the Conditions, as well as additional factors such
as: Michael Kors' ability to integrate the businesses successfully
and to achieve anticipated benefits of the acquisition; the risk of
disruptions to Michael Kors' or Jimmy Choo's businesses; the
negative effects of the announcement of the Acquisition or the
consummation of the Acquisition on the market price of the Michael
Kors' ordinary shares and its operating results; significant
transaction costs; unknown liabilities; the risk of litigation
and/or regulatory actions related to the Acquisition; fluctuations
in demand for Jimmy Choo's and Michael Kors' products; changes in
consumer traffic and retail trends; loss of market share and
industry competition; fluctuations in the capital markets;
fluctuations in interest and exchange rates; the occurrence of
unforeseen disasters or catastrophes; political or economic
instability in principal markets; adverse outcomes in litigation;
and general, local and global economic, political, business and
market conditions, as well as those risks set forth in the reports
that Michael Kors files from time to time with the U.S. Securities
and Exchange Commission. Other unknown or unpredictable factors
could cause actual results to differ materially from those in the
forward-looking statements. Such forward-looking statements should
therefore be construed in the light of such factors. Neither
Michael Kors nor Michael Kors Bidco, nor Jimmy Choo, nor any of
their respective associates or directors, officers or advisers,
provides any representation, assurance or guarantee that the
occurrence of the events expressed or implied in any
forward-looking statements in this Announcement will actually
occur. Due to such uncertainties and risks, readers are cautioned
not to place undue reliance on such forward-looking statements. All
subsequent oral or written forward-looking statements attributable
to Michael Kors, Michael Kors Bidco or Jimmy Choo or any of their
respective members, directors, officers or employees or any persons
acting on their behalf are expressly qualified in their entirety by
the cautionary statement above. Unless otherwise required by
applicable law, Michael Kors, Michael Kors Bidco and Jimmy Choo
disclaim any obligation to update or revise any forward-looking or
other statements contained herein other than in accordance with
their legal and regulatory obligations.
Rounding
Certain figures included in this Announcement have been
subjected to rounding adjustments. Accordingly, figures shown for
the same category presented in different tables may vary slightly
and figures shown as totals in certain tables may not be an
arithmetic aggregation of the figures that precede them
No profit forecasts or estimates
No statement in this Announcement, or incorporated by reference
into this Announcement, is intended to be or is to be construed as
a profit forecast or estimate for any period and no statement in
this Announcement should be interpreted to mean that earnings or
earnings per share for Michael Kors, Michael Kors Bidco or Jimmy
Choo, as appropriate, for the current or future financial years, or
those of the Combined Group, would necessarily match or exceed the
historical published earnings or earnings per share for Michael
Kors, Michael Kors Bidco or Jimmy Choo, as appropriate.
Disclosure requirements of the City Code
Under Rule 8.3(a) of the City Code, any person who is interested
in 1% or more of any class of relevant securities of an offeree
company or of any securities exchange offeror (being any offeror
other than an offeror in respect of which it has been announced
that its offer is, or is likely to be, solely in cash) must make an
Opening Position Disclosure following the commencement of the offer
period and, if later, following the announcement in which any
securities exchange offeror is first identified. An Opening
Position Disclosure must contain details of the person's interests
and short positions in, and rights to subscribe for, any relevant
securities of each of (i) the offeree company and (ii) any
securities exchange offeror(s). An Opening Position Disclosure by a
person to whom Rule 8.3(a) applies must be made by no later than
3.30 p.m. (London time) on the 10th Business Day following the
commencement of the offer period and, if appropriate, by no later
than 3.30 p.m. (London time) on the 10th Business Day following the
announcement in which any securities exchange offeror is first
identified. Relevant persons who deal in the relevant securities of
the offeree company or of a securities exchange offeror prior to
the deadline for making an Opening Position Disclosure must instead
make a Dealing Disclosure.
Under Rule 8.3(b) of the City Code, any person who is, or
becomes, interested in 1% or more of any class of relevant
securities of the offeree company or of any securities exchange
offeror must make a Dealing Disclosure if the person deals in any
relevant securities of the offeree company or of any securities
exchange offeror. A Dealing Disclosure must contain details of the
dealing concerned and of the person's interests and short positions
in, and rights to subscribe for, any relevant securities of each of
(i) the offeree company and (ii) any securities exchange
offeror(s), save to the extent that these details have previously
been disclosed under Rule 8. A Dealing Disclosure by a person to
whom Rule 8.3(b) applies must be made by no later than 3.30 p.m.
(London time) on the Business Day following the date of the
relevant dealing.
If two or more persons act together pursuant to an agreement or
understanding, whether formal or informal, to acquire or control an
interest in relevant securities of an offeree company or a
securities exchange offeror, they will be deemed to be a single
person for the purpose of Rule 8.3.
Opening Position Disclosures must also be made by the offeree
company and by any offeror and Dealing Disclosures must also be
made by the offeree company, by any offeror and by any persons
acting in concert with any of them (see Rules 8.1, 8.2 and
8.4).
Details of the offeree and offeror companies in respect of whose
relevant securities Opening Position Disclosures and Dealing
Disclosures must be made can be found in the Disclosure Table on
the Takeover Panel's website at www.thetakeoverpanel.org.uk,
including details of the number of relevant securities in issue,
when the offer period commenced and when any offeror was first
identified. You should contact the Panel's Market Surveillance Unit
on +44 (0)20 7638 0129 if you are in any doubt as to whether you
are required to make an Opening Position Disclosure or a Dealing
Disclosure.
Publication on website and availability of hard copies
A copy of this Announcement and the documents required to be
published by Rule 26 of the City Code will be made available,
subject to certain restrictions relating to persons resident in
Restricted Jurisdictions, on Michael Kors' website at
http://investors.michaelkors.com. For the avoidance of doubt, the
contents of this website are not incorporated into and do not form
part of this Announcement.
This information is provided by RNS
The company news service from the London Stock Exchange
END
IODURVNRBOARUAA
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