TIDMHPA1
RNS Number : 5519Q
Hambro Perks Acquisition Com Ltd
29 June 2022
HAMBRO PERKS ACQUISITION COMPANY LIMITED
("Hambro Perks")
28 June 2022
ANNUAL REPORT AND AUDITED FINANCIAL STATEMENTS
Hambro Perks is pleased to announce the release of its Annual
Report and Audit Financial Statements for the period from 14 April
2021 (date of Incorporation) to 31 December 2021 (the "AFS"),
approved by the Board of Directors on the 28 June 2022. The AFS are
set out below in its full unedited form.
For further information, please contact:
Company Administrator
Ocorian Administration (Guernsey) Limited
hambroperks@ocorian.com
Company Secretary
Peter Soliman
peter@hambroperks.com
About Hambro Perks:
Hambro Perks is a special purpose acquisition company
incorporated as a non-cellular company limited by shares under the
laws of the Island of Guernsey with number 69093 and for the
purpose of acquiring a majority (or otherwise controlling) stake in
a company or operating business through a merger, capital stock
exchange, share purchase, asset acquisition, reorganisation or
similar transaction. Hambro Perks intends to focus on
technology-enabled businesses with principal business operations in
the United Kingdom, a member state of the European Economic Area or
Switzerland.
HAMBRO PERKS ACQUISITION COMPANY LIMITED
ANNUAL REPORT AND AUDITED FINANCIAL STATEMENTS
FOR THE PERIOD FROM 14 APRIL 2021 (DATE OF INCORPORATION)
TO 31 DECEMBER 2021
CONTENTS
Company Summary
2
Chairman's Statement
3
Board of Directors
4 - 5
Directors' Report
6 - 11
Corporate Governance Statement
12 - 17
Statement of Directors' Responsibilities
18
Report of the Audit Committee
19 - 20
Independent Auditor's Report
21 - 28
Financial Statements
Statement of Comprehensive Income 29
Statement of Financial Position
30
Statement of Changes in Equity
31
Statement of Cash Flows
32
Notes to the Financial Statements 33 - 47
Officers and Advisers
48
COMPANY SUMMARY
Principal activity
Hambro Perks Acquisition Company Limited (the "Company") was
incorporated and registered in Guernsey under The Companies
(Guernsey) Law, 2008 on 14 April 2021 with a registration number
69093 as a special purpose acquisition company ("SPAC")
incorporated for the purpose of acquiring a majority (or otherwise
controlling) stake in a company or operating business (the "Target"
or "Target Business") through a merger, capital stock exchange,
share purchase, asset acquisition, reorganisation or similar
transaction (a "Business Combination"). The Company intends to
focus on the technology-enabled sector and businesses with
principal business operations in the United Kingdom.
The Company's main objective is to complete its Business
Combination within an initial period of 15 months from the
Settlement Date (the "Initial Business Combination Deadline"),
subject to an initial three month extension period (the "First
Extension Period") and a further three month extension period (the
"Second Extension Period"), in each case if approved by a
Shareholder vote (the "Business Combination Deadline"), although
such extensions are not of a type required to be approved by Public
Shareholders as contemplated by Listing Rule 5.6.18AG.
Business Combination
The Company anticipates structuring its Business Combination
either (i) in such a way so that the post-transaction company will
own or acquire 100% of the equity interests or assets of the
Target, or (ii) in such a way so that the post -transaction company
owns or acquires less than 100% of such interests or assets of the
Target in order to meet certain objectives of the Target management
team or stockholders, or for other reasons. However, the Company
will only complete a Business Combination if the post-transaction
company owns or acquires 50% or more of the outstanding voting
securities of the Target or otherwise acquires a controlling
interest in the Target.
Even if the Company owns 50% or more of the voting securities of
the Target Business, Public Shareholders, prior to the Business
Combination, may collectively own a minority interest in the
post-Business Combination company, depending on valuations ascribed
to the Target Business and the Company in the Business Combination.
For example, the Company could pursue a transaction in which it
issues a substantial number of new Ordinary Shares to shareholders
of the Target in exchange for all of the outstanding share capital
of the Target. In this case, the Company would acquire a 100%
controlling interest in the Target. However, as a result of the
issuance of a substantial number of new Ordinary Shares, the Public
Shareholders immediately prior to such transaction could own less
than a majority of the Company's Public Shares subsequent to such
transaction.
The Business Combination Process
In evaluating prospective Business Combinations, the Company
expects to conduct a thorough due diligence review that may
encompass, among other things, a review of historical and projected
financial and operating data, meetings with management and their
advisers (if applicable), on-site inspections of facilities and
assets to the extent possible, discussion with customers and
suppliers, document reviews, as well as a review of financial,
operational, legal and other information which will be made
available to the Company and which the Company deem appropriate.
The Company will also use the Company ' s expertise and the Company
' s Sponsor ' s expertise in analysing companies and evaluating
operating projections, financial projections and determining the
appropriate return expectations.
CHAIRMAN'S STATEMENT
Dear Shareholders,
It is with pleasure that I present the financial statements of
Hambro Perks Acquisition Company Limited ("HPAC" or the "Company")
for the period ended 31 December 2021.
HPAC was admitted to trading on the main market of the London
Stock Exchange on 25 November 2021, having raised in excess of
GBP150 million from an offer of new shares. The Company is now
seeking to identify a suitable target company as outlined in the
prospectus.
It remains focused on its goal of acquiring a high-quality
technology-enabled business. To achieve this, we are using the
following criteria in evaluating prospective target companies:
-- Attractive market - particularly in the UK and Europe.
-- Differentiation - company with an established market and
product position whose offering is distinctive.
-- Innovation - company with a strategy to convert innovation
into competitive advantages that sustains growth.
-- Scalable revenues
-- Strong management
-- Valuation - sensible valuations that provide substantial
upside opportunities in the long term.
-- Public market fit
-- ESG - a company that is socially and environmentally
responsible with a strong corporate governance framework.
While the war in Ukraine and the pandemic have contributed to an
uncertain market backdrop, we have identified a number of companies
that we consider potentially to meet a number of our target
criteria. We remain cautiously optimistic that we will approve
terms for a business combination within the time constraints
referenced in the prospectus.
I am excited by the opportunities we are considering and I am
looking forward to announcing a prospective business
combination.
On behalf of the Board, I thank you for your valued support.
Sir Anthony Salz
Chairman
28 June 2022
BOARD OF DIRECTORS
The Board is responsible for leading and controlling the Company
and has overall authority for the management and conduct of its
business, strategy and development. The Board is also responsible
for ensuring the maintenance of a sound system of internal controls
and risk management (including financial, operational and
compliance controls) and for reviewing the overall effectiveness of
systems in place as well as for the approval of any changes to the
capital, corporate and/or management structure of the Company.
The Board comprises five members, details of which are set out
below. Notwithstanding their acquisition of indirect interests in
Class B Ordinary shares ("Sponsor Shares") by acquiring
participating interests in the membership capital of the Sponsor,
Mr Dominic Shorthouse and Dr Sarah Wood are considered to be
independent, as the level of their interests in the share capital
of the Company is not sufficiently material to their personal
circumstances to exert any material influence over their actions,
nor are their shareholdings material to the Company. Mr Matthew
Wood is also considered to be independent. Sir Anthony Salz and Mr
Dominic Perks are not considered to be independent by virtue of
their relationship with Hambro Perks Limited. Hambro Perks Limited
is the majority owner of the Sponsor.
None of the directors holds a directorship position in other
public companies.
Sir Anthony Salz (non-executive Chairman)
Sir Anthony Salz is the Chairman of Hambro Perks and former
Chairman of its advisory board. Sir Anthony was a corporate lawyer
with Freshfields Bruckhaus Deringer for over 30 years and spent the
last ten as its Senior Partner. Sir Anthony focused on M&A
mandates, typically cross-border, and worked with clients including
Amersham International on its sale to GE, Reed International on its
merger with Elsevier, Dresdner on its acquisition of Kleinwort
Benson, Smith Kline on its merger with Beecham, Wellcome and its
advisers on its acquisition by Glaxo, the merger of Astra and
Zeneca, ICI on its acquisition of chemical assets from Unilever, O2
on its separation from BT, and British Satellite Broadcasting
Holdings on its merger with Sky Television to form BSkyB. Sir
Anthony then joined Rothschild & Co in 2006 as Executive Vice
Chairman, where he served on the board for 11 years. He advised a
number of clients on M&A and other strategic projects including
Alliance & Leicester on its sale to Santander. Sir Anthony
serves as Trustee of the Tate Foundation and the Conran Foundation
and is Chair of Forward Institute, a not-for-profit company that
runs responsible leadership programmes.
Previous roles include Vice Chair of the BBC Board of Governors,
Senior Independent Member of the board of the Department for
Education, Chair of Teach First's Business Development Council, of
Freeformers Holdings and of Bloomsbury Publishing plc, and Trustee
of the Royal Opera House, the Paul Hamlyn Foundation, the Scott
Trust (owner of The Guardian) and the Eden Trust (owner of the Eden
Project in Cornwall). He served on the investment committees of
both the Scott Trust Limited and the Paul Hamlyn Foundation. Sir
Anthony has also chaired reviews on Youth Crime, Press Regulation
and Barclays PLC's Business Practices .
Dominic Perks (Executive Director)
Dominic Perks is Co-Founder and Chief Executive Officer of
Hambro Perks. He serves as Chairman and voting member on Hambro
Perks' investment committee. Previously a strategy consultant at
McKinsey & Co. where he advised firms on growth strategy, and
an investment banker at Morgan Stanley, where he originated
investment opportunities for private equity firms, Dominic is known
for deal making, solving problems, and cultivating relationships
with industry leaders and investors. At Hambro Perks, Dominic is
actively involved in originating and assessing opportunities for
investment, as well as advising founders of portfolio companies at
all stages of growth. Dominic also serves as Hambro Perks' Investor
Director on boards for Tempfair Limited (known as Tempo), Takumi
International Limited and Gelesis, Inc. Dominic is a mentor to
founders and a serial entrepreneur having invested in, built and
exited multiple companies. Investments include Metabolic Healthcare
Limited (known as Echo), Insurtech Gateway Limited, By Miles
Limited, Muzmatch Limited and What3Words Limited. Dominic graduated
from Oxford University with a first-class degree in English
Literature.
Dominic Shorthouse (Non-Executive Director)
Dominic Shorthouse is an independent investor and adviser to a
number of funds and family offices including ESAS, Lennox IM, PMB
Capital and Africa Lighthouse. Previously, Dominic was Founder and
Managing Partner of Englefield Capital, a mid-market private equity
firm, and before that he was a Partner at Warburg Pincus. Dominic
is a very experienced investor, manager, and board member with a
successful record of creating investment opportunities and building
businesses since 1988. He has been involved in investing more than
EUR3 billion of private capital and played a role on more than 50
boards based in the UK, France, Germany, Denmark, Holland, Italy,
Ireland, China and the US, including three PLCs listed in London
and one on the NASDAQ. He has had extensive involvement in many
sectors including education, energy, financial services, healthcare
and life sciences, and telecoms and has worked with institutional
and family capital on a large scale.
At Englefield Capital, the investments were predominantly
control investments in sectors with positive macro forces. Examples
of Englefield investments include the creation from scratch of
Cognita, a leading international schools business, through 30
acquisitions, the purchase of Canopius and its evolution into a
leading Lloyds market Property & Casualty insurance business,
and early insight into the opportunities of renewable energy
investing with the investment in Zephyr, a large portfolio of
wind-farms.
At Warburg Pincus, Dominic was a Partner, co-heading the London
office, and was the first non-US Member of the Operating Committee.
Notable investments at Warburg Pincus include the creation of
Channel 5, and investment in Esprit Telecom and its subsequent IPO
which took advantage of deregulation in the telecommunications
market across Europe. Dominic serves as Deputy Chair of The Anna
Freud Centre, a leading charity in the field of child and
adolescent mental health. He graduated from Oxford University with
a degree in Classics and Philosophy and went on to gain an MBA from
the Stanford Graduate School of Business.
Matthew Wood (Non-Executive Director)
Matthew Wood has over 20 years of experience in financial
services. Matt qualified as a Chartered Accountant with PwC in
Guernsey in 2002, specialising in banks and investment funds. He is
a member of the Institute of Directors ("IoD") and completed the
IoD certificate and diploma in Company direction in 2011. He is a
graduate in Biological Sciences from Exeter University.
In 2003 Matt joined Butterfield Fund Services preparing accounts
and investor reporting for private equity, real estate and mutual
funds. He then joined Mourant International Finance Administration
("MIFA") in Guernsey in 2004 to head up the accounting function for
Private Equity and Real Estate Funds. During his time at MIFA he
held several senior roles, across Accounting, Business Development
and Management and worked in MIFA's London and Dubai offices. In
2009 he returned to Guernsey as Managing Director of MIFA's
Guernsey office where he prepared the Guernsey business for a trade
sale to State Street Alternative Investment Solutions in 2010. He
remained as Managing Director with State Street until 2012 when he
left to become a consultant raising capital for Private Equity
funds at Cygnus Capital Partners.
In 2014 Matt joined Sanne Group ("Sanne") to head up their
Guernsey office delivering Fund and Corporate Administration
services to a wide range of Alternative Investment Funds and
corporate structures. Matt remained with Sanne until 2019, when he
left to develop his career as an independent director in Guernsey,
where he now holds director positions across a broad spectrum of
alternative investment funds and corporate structures. He is a
partner in Arolla Partners Limited, a Guernsey based directorship
services business.
Sarah Wood (Non-Executive Director)
Dr Sarah Wood is co-founder and former chief executive of
Unruly, the global video advertising marketplace acquired by News
Corp in 2015. A former non-executive director at Superdry plc,
Sarah is currently a board member at decision augmentation company
Signal AI, and senior independent director at Tech Nation, the
growth platform for ambitious tech entrepreneurs. Sarah is also an
investor and director in Magnolia Ventures and serves as a trustee
at the Anna Freud National Centre for Children and Families. In
2016, Sarah was awarded an OBE for services to innovation and
technology. She graduated from the University of Cambridge,
received a doctorate in American Literature from UCL and an
honorary doctorate from City, University of London.
DIRECTORS' REPORT
The Directors of Hambro Perks Acquisition Company Limited (the
"Company") are pleased to submit their Annual Report and Audited
Financial Statements (the "Financial Statements") for the period
from 14 April 2021 to 31 December 2021.
The Company was established in Guernsey on 14 April 2021. Its
Class A ordinary shares were admitted to the standard listing
segment of the Official List of the Financial Conduct Authority and
to trading on the London Stock Exchange's main market for listed
securities on 25 November 2021 and the associated warrants were
listed on 7 January 2022.
Principal Activity
The Company is a special purpose acquisition company ("SPAC")
incorporated for the purpose of acquiring a majority (or otherwise
controlling) stake in a company or operating business (the "Target"
or "Target Business") through a merger, capital stock exchange,
share purchase, asset acquisition, reorganisation, or similar
transaction (a "Business Combination"). The Company intends to
focus on the technology-enabled sector and businesses with
principal business operations in the United Kingdom, a member state
of the European Economic Area (the "EEA") or Switzerland.
The Company's main objective is to complete its Business
Combination within an initial period of 15 months from 25 November
2021 (the "Initial Business Combination Deadline"), subject to an
initial three month extension period (the "First Extension Period")
and a further three month extension period (the "Second Extension
Period"), in each case if approved by a Shareholder vote (the
"Business Combination Deadline"), although such extensions are not
of a type required to be approved by Public Shareholders as
contemplated by Listing Rule 5.6.18AG.
Prior to the completion of its Business Combination, the Company
has not and will not engage in any operations, other than in
connection with the selection, structuring and completion of its
Business Combination.
Business Combination
Once the Target Business has been identified, Shareholders
(other than in respect of any restricted shares, being Public
Shares held by the Sponsor or the Directors which are subject to
the Lock-up and Waiver Agreement (see note 12)) will be asked to
vote on the proposed Business Combination at a general meeting
specifically convened for this purpose. The Company will provide
its Public Shareholders with the opportunity to redeem all or a
portion of their Public Shares upon the completion of the Business
Combination irrespective of whether and how they voted at the
general meeting.
If the Business Combination is not completed by the Business
Combination Deadline, the Company will (i) cease all operations
except for the purpose of winding up, (ii) as promptly as
reasonably possible redeem the Public Shares, at a per-share price,
payable in cash, equal to the aggregate amount then on deposit in
the Escrow Account, including interest earned on the funds held in
the Escrow Account (less taxes payable and up to GBP100,000 to pay
dissolution expenses), divided by the number of then outstanding
Public Shares, and (iii) as promptly as reasonably possible
following such redemption, subject to the approval of the Company's
remaining Shareholders and the Board of Directors of the Company
(the "Board"), liquidate and dissolve the Company. There will be no
redemption rights or liquidating distributions with respect to the
Public Warrants which will automatically expire without value if
the Company does not complete its Business Combination by the
Business Combination Deadline.
Going Concern
The Board has assessed the Company's financial position as at 31
December 2021 and the factors that may impact the Company for a
period up to 30 June 2023 being 12 months from the date of signing
of these Financial Statements.
In particular, the Company has prepared a base-level detailed
financial forecast for the Going Concern Period to 30 June
2023.
The key assumptions in the financial forecasts include:
-- No further cash inflows for the remainder of the Going Concern Period;
-- If required, the Sponsor has the ability to fund costs of
operation via a loan to the company of which up to GBP1.5 million
may be convertible into warrants in the post-business combination
company at a price of GBP1.00 per warrant;
-- Shareholders approve two extension periods - extension
periods will only be utilised where a Target Company has been
identified in the original 15 month period and extra time is
required to complete the deal. The Target Company being identified
incentivises the shareholders to approve the extension periods;
-- Base fixed costs of operation of approximately GBP50,000 per
month for the remainder of the Going Concern Period;
-- Balance of cash available could be used to fund transaction
costs, noting de-spac costs to be paid out of the Escrow account;
and
-- No additional significant expenses are identified.
Going Concern, continued
After reviewing the Company's committed expenses for the period,
the Board are comfortable there will be a significant cash buffer
of GBP1.07m, save for transaction costs (see below), at the end of
the Going Concern Period. As these committed expenses are in line
with signed engagement letters and agreements, the Board is assured
that these expenses can be reliably measured and factored into
their budgeting.
The cash buffer could be utilised to pay for transactions costs,
expected to only be used in the event of an aborted deal, however
the Board considers the likelihood of such an event to be low.
Given the Company's current financial position, the Board are of
the view that the Company could adequately fund two aborted
Business Combinations and all contracted ongoing costs without the
need to source any additional funding options. On a successful
Business Combination, the costs of acquisition will be borne by the
Company from Escrow cash balance not Company cash balance.
In addition, the Board has noted that the Company's policy is
that no dividend will be declared until after a successful Business
Combination to ensure that capital is maintained in the period
prior to the Business Combination.
If the Business Combination is not completed by the Business
Combination deadline the company would cease to exist. However,
having appointed an experienced Advisor with access to a diverse
network of professionals the Company is in a strong position for
sourcing potential investment opportunities. The Board is satisfied
by the progress made in identifying a Target Company and believes
it is positioned to complete the Business Combination within the
initial 15 month period. The Company has adequate resources to
continue in operation for the going concern period and to meet its
liabilities as and when they fall due. The Board also note that the
Company's operations have not been significantly affected by the
Covid-19 pandemic. Accordingly, the Board is of the opinion that it
is appropriate to prepare these Financial Statements on a going
concern basis.
Principal risks and uncertainties
The following is a summary of key risks that, alone or in
combination with other events or circumstance, the Board has
determined could have a material adverse effect on the Company's
business, financial condition, results of operations and prospects.
In making the selection, the Company has considered circumstances
such as the probability of the risk materialising, the potential
impact which the materialisation of the risk could have on the
Company's business, financial condition, and prospects, and the
attention that management would, on the basis of current
expectations, have to devote to these risks if they were to
materialise:
-- there is no assurance that the Company will identify suitable
Business Combination opportunities by the Business Combination
Deadline, which will result in the Company being unable to continue
in operation;
-- the requirement that the Company completes its Business
Combination by the Business Combination Deadline may give potential
Target Businesses leverage over the Company in negotiating the
Business Combination and may limit the time the Company has in
which to conduct due diligence on potential Target Businesses;
-- Public Shareholders' ability to exercise redemption rights
with respect to a large number of the Public Shares may not allow
the Company to complete the most desirable Business Combination or
optimise its capital structure; and
-- in order to continue operations to the point where the
Company is able to complete a Business Combination, particularly if
the Business Combination is not completed by the Initial Business
Combination Deadline, the Company will need to ensure that it has
sufficient funds from its Placing to meet all its listing and
operating expenses through to the final Business Combination
Deadline.
To help mitigate the above risks, the Company has appointed
Hambro Perks Advisory LLP (the "Advisor"), an FCA registered
investment manager controlled by Hambro Perks Limited to act as
M&A advisor in connection with the Business Combination. The
Hambro Perks Group is supported by a diverse network whose
relationships provide considerable potential for sourcing and
evaluating potential investment opportunities.
To counteract Shareholders' exercising their redemption rights
normal practice is to raise funds via a Private Investment Public
Equity deal to cover the minimum cash requirement needed to
complete the Business Combination.
In respect of the Company's system of internal controls and its
effectiveness, the Directors:
Principal risks and uncertainties, continued
-- are satisfied that they have carried out a robust assessment
of the principal risks facing the Company, including those that
would threaten its business model, future performance, solvency or
liquidity; and
-- have reviewed the effectiveness of the risk management and
internal control systems including material financial, operational
and compliance controls (including those relating to the financial
reporting process) and no significant failings or weaknesses were
identified.
A review of the main financial risks faced by the Company, and
how they are managed or mitigated, is set out in note 5 to the
Financial Statements.
Emerging risks
The Board is constantly alert to the identification of any
emerging risks. The Board will then assess the likelihood and
impact of any such emerging risks and will discuss and agree
appropriate strategies to mitigate and/or manage the identified
risks. Emerging risks are managed through discussion of their
likelihood and impact at each quarterly Board meeting. Should an
emerging risk be determined to have any potential impact on the
Company, appropriate mitigating measures and controls are
agreed.
Viability Statement
The Board have assessed the prospects of the Company over a
longer period than 12 months required by the going concern
assessment. As the Company's operation is restricted to structuring
and completing its Business Combination, the Board have assessed
the viability of the Company over a 20-month period to the Business
Combination Deadline of 31 August 2023, taking account of the
Company's current position and the potential impact of the
principal risks outlined in this statement.
The Company's main objective is to complete its Business
Combination within an initial period of 15 months from the
Settlement Date (the "Initial Business Combination Deadline"),
subject to an initial three month extension period (the "First
Extension Period") and a further three month extension period (the
"Second Extension Period"), in each case if approved by a simple
majority of the holders of Ordinary Shares in a general meeting
(the "Business Combination Deadline"). These extension periods
would only be utilised if a Business Combination was in progress at
the end of the initial 15 months and further time was required to
complete the deal. By having a Target Company identified within the
15 month period the Board believes the shareholders will be
encouraged to approve the extension periods.
To the extent that the Initial Business Combination Deadline is
extended, the Sponsor will commit further additional funds to the
Company through the subscription of up to a further 140,000 Public
Shares and 70,000 Public Warrants for a consideration of GBP10.00
for (i) one Public Share and (ii) 1/2 of a Public Warrant (up to
GBP1,400,000 in aggregate) for the First Extension Period and the
subscription of up to a further 140,000 Public Shares and 70,000
Public Warrants for a consideration of GBP10.00 for (i) one Public
Share and (ii) 1/2 of a Public Warrant (up to GBP1,400,000 in
aggregate) for the Second Extension Period (the "Additional Sponsor
Subscriptions"), the proceeds of which are to be held in the Escrow
Account as additional Escrow Account Overfunding.
If an extension is approved by a simple majority of the holders
of Ordinary Shares, the Sponsor is confident it will be able to
raise up to GBP2.8 million (and GBP1.5 million for Sponsor
Warrants) either directly from Hambro Perks Ltd or other members of
the Sponsor. Hambro Perks Ltd has the network and track record
available to raise additional funds should the need arise.
In the event that a Business Combination is not completed by 31
August 2023, the Company will (i) cease all operations except for
the purpose of winding up, (ii) as promptly as reasonably possible
but no more than 10 business days thereafter, subject to the
requirements of the Companies Law redeem the Public Shares, at a
per-share price, payable in cash, equal to the aggregate amount
then on deposit in the Escrow Account, including interest earned on
the funds held in the Escrow Account (less taxes payable and up to
GBP100,000 to pay dissolution expenses), divided by the number of
then outstanding Public Shares, which redemption will completely
extinguish Public Shareholders' rights as Shareholders (including
the right to receive any further liquidation distributions, if
any), (iii) not use any amounts then on deposit in the Escrow
Account to repay any loans provided by the Sponsor to finance
transaction costs in connection with an intended Business
Combination and (iv) as promptly as reasonably possible following
such redemption, subject to the approval of the Company's remaining
Shareholders and the Board, liquidate and dissolve, subject in each
case to its obligations under Guernsey law to provide for claims of
creditors and in all cases subject to the other requirements of
applicable law.
Viability statement, continued
The Board believe the Company is in a strong position to
complete the Business Combination within the initial 15 month
period given the progress made in identifying potential Target
Businesses. The company is in advance discussions with a number of
companies in connection with a potential Business Combination
having entered into confidentiality agreements and undertaken
initial due diligence.
Results
The results for the period are shown in the Statement of
Comprehensive Income on page 29. The Company has made a profit of
GBP1,080,886 for the period. As the Company is an early stage SPAC,
the Directors are satisfied with the results for the year and are
focused on managing expenditure within the business whilst target
acquisitions are identified. There are no key performance
indicators that have been considered by the Directors.
Directors
Details of the Directors who held office in the period can be
found on page 48.
Directors' Interests
The Directors had the following interests in the Company at 31
December 2021, held indirectly via participation in the membership
interests of the Sponsor:
31 December 2021
Name Number of Number of Total Percentage of shares in issue %
Public Shares Sponsor Shares Number of
Shares
----------------------------- --------------- ---------------- ----------- --------------------------------
Sir Anthony Salz (Chairman) 22,750 238,030 260,780 1.40
Dominic Perks 52,500 549,299 601,799 3.22
Matthew Wood - - - -
Sarah Wood 8,750 91,550 100,300 0.54
Dominic Shorthouse 38,500 402,820 441,320 2.36
There have been no changes to the Directors' shareholdings since
31 December 2021.
Directors' Remuneration
Directors undertake to provide services to the Company and be
paid an annual fee for such services in accordance with each
Directors letter of appointment. The Company's directors will be
paid an annual fee of GBP40,000 per annum and will be reimbursed
for any out-of-pocket expenses incurred in connection with
activities on the Company's behalf such as identifying potential
Target Businesses and performing due diligence on suitable business
combinations. All Directors' fees were payable with effect from the
later of 24 November 2021 or the date of appointment.
The Directors received the following remuneration in the form of
Directors' fees:
For the period
from
14 April 2021
to
31 December 2021
Per annum Actual
GBP GBP
Sir Anthony Salz 40,000 4,164
Dominic Perks 40,000 4,164
Dominic Shorthouse 40,000 4,164
Matthew Wood 40,000 4,164
Dr Sarah Wood 40,000 3,508
---------- ------------------
200,000 20,164
---------- ------------------
The remuneration policy set out above is the one applied for the
period from 14 April to 31 December 2021 and is not expected to
change in the immediate future.
Directors' conflicts
Below is a table summarising the entities to which the Company's
Directors currently have fiduciary duties or contractual
obligations that may present a conflict of interest:
Individual Entity Entity's Business Affiliation
----------------- ---------------------------------- --------------------------- ----------------------------------
Sir Anthony Salz Hambro Perks Limited Investment firm Affiliate of the Sponsor and M&A
adviser in connection with a
Business Combination.
Dominic Perks Hambro Perks Limited Investment firm Affiliate of the Sponsor and M&A
(and various subsidiaries owned adviser in connection with a
by Hambro Perks Limited) Business Combination.
Portfolio companies in which Various The Company may seek a Business
Hambro Perks Limited has invested Combination with a company in
which Hambro Perks Limited has
invested
Matthew Wood Arolla Partners Professional services firm Director of certain companies
within the broader Hambro Perks
group
The Company does not believe, however, that the fiduciary,
contractual or other obligations or duties of the Company's
Directors, or of Hambro Perks, or policies applicable to Hambro
Perks, will materially affect the Company's ability to complete the
Company's Business Combination.
Substantial shareholdings
Below is a table summarising the shareholders holding 5% or over
of the total number of Shares in issue:
31 December 2021
Name Number of Percentage %
Shares
------------------ --- ---------- -------------
Aristeia Capital 1,200,000 6.43
LMR Partners 1,175,000 6.29
------------------------ ---------- -------------
Insurance
The company maintains a sufficient level of cover under its
Directors' and Officers and Company Reimbursement insurance
policy.
Dividend Policy
The Company has not yet adopted a dividend policy. The Company
has not paid any dividends to date and will not pay any dividends
prior to the Business Combination Completion Date. The payment of
cash dividends in the future will be dependent upon the Company's
revenues and earnings, if any, capital requirements and general
financial condition subsequent to the completion of its Business
Combination.
Independent Auditor
Grant Thornton UK LLP ("GT") was appointed as independent
auditor on 24 November 2021 following a tender process. GT served
as the Company's Auditor throughout the period and has indicated
its willingness to continue in office.
Listing Requirements
Since its listing on the standard segment of the main market of
the London Stock Exchange, the Company has complied with the
Prospectus Rules, the Disclosure and Transparency Rules, the
Listing Rules pertinent to a standard listing, and the Market Abuse
Directive (as implemented in the UK through Financial Services and
Markets Authority ).
Corporate Governance
As an unregulated company incorporated under the laws of
Guernsey with a standard listing on the London Stock Exchange's
main market, the Company has no statutory obligation or listing
requirement to adopt a corporate governance code. However, Company
will seek to comply with UK Corporate Governance Code insofar as
appropriate for a company of the Company's size and nature.
-- The Directors' Corporate Governance Statement in respect of
its governance obligations can be found on pages 12 to 17.
-- The Board has established an Audit Committee, comprised of
two independent directors, to provide oversight and preserve the
integrity of the Company's financial reporting process and internal
controls and risk management systems, and to monitor the statutory
audit of the Company's annual financial statements. The Report of
the Audit Committee can be found on pages 19 to 20.
Disclosure of Information to the Independent Auditor
The Directors who held office at the date of approval of this
Directors' Report confirm that, so far as they are each aware,
there is no relevant audit information of which the Company's
Auditor is unaware; and each Director has taken all the steps that
he ought to have taken as a Director to make himself aware of any
relevant audit information and to establish that the Company's
Auditor is aware of that information.
By order of the Board
Sir Anthony Salz
Director
28 June 2022
CORPORATE GOVERNANCE STATEMENT
Compliance
As an unregulated company incorporated under the laws of
Guernsey with a standard listing on the London Stock Exchange's
main market, the Company has no statutory obligation or listing
requirement to adopt a corporate governance code. However, Company
will seek to comply with UK Corporate Governance Code insofar as
appropriate for a SPAC in its pre-merger stage.
Therefore, the Company does not comply with the Governance Code
in the following respects:
-- N o remuneration committee or nomination committee will be
constituted prior to any Business Combination. The Board as a whole
will instead review its size, structure and composition and the
scale and structure of the Directors' fees (taking into account the
interests of Shareholders and the performance of the Company).
-- The Company's Chairman, Sir Anthony Salz, is not considered
to be independent and therefore the Company does not comply with
the requirements of the Governance Code in relation to the
requirement for the chairman to be independent on appointment. The
Board considers that this is reflective of his importance to the
Company at this stage and is not detrimental to the Board's overall
effectiveness or role in promoting the long-term sustainable
success of the Company.
-- The Company has not appointed a senior independent director.
-- The Governance Code recommends the submission of all
directors for re-election at annual intervals. No Director will be
required to submit for re-election until the first annual general
meeting of the Company following the Business Combination. Prior to
the Business Combination, only holders of the Sponsor Shares will
be able to appoint or remove the Directors.
-- The Governance Code recommends that boards should adopt a
suitable method for engagement with the Company's workforce. As the
Company does not have any employees, the Company has not (i)
implemented any such arrangement or (ii) adopted a whistle-blowing
policy to allow its workforce to raise concerns in confidence.
-- Diversity policy: While no diversity policy has been adopted,
t he Board is committed to diversity and is supportive of increased
gender and ethnic diversity but recognises that it may not always
be in the best interest of shareholders to prioritise this above
other factors. The Board is composed of Directors with the
requisite skills and knowledge to perform the duties required by
the Company prior to any Business Combination. Following any
successful Business Combination, the Board composition will be
altered to better align with the nature of Company following the
Business Combination at which point it is intended that a diversity
policy will be adopted.
Committees
If the need should arise in the future, for example following
the Business Combination, the Board may set up committees as it
deems appropriate to the size and nature of the Company.
Share dealing
As at the date of the Prospectus the Board has adopted a share
dealing code which is consistent with the rules of the UK Market
Abuse Regulation. The Board is responsible for taking all proper
and reasonable steps to ensure compliance with such share dealing
code by the Directors.
Composition and Independence of the Board
As at 31 December 2021, the Board comprised five Directors who
are listed below. The Company has no employees. The biographies of
the Board members can be found on pages 4 to 5.
Sir Anthony Salz - Chairman (appointed 9 November 2021)
Dominic Perks - Chief Executive Officer (appointed 8 June
2021)
Dominic Shorthouse - Chief Investment Officer (appointed 9
November 2021)
Matthew Wood - Independent Non-Executive Director (appointed 8
June 2021)
Sarah Wood - Independent Non-Executive Director (appointed 30
November 2021)
Under the terms of appointment, the Directors may appoint any
person to be a Director, either to fill a vacancy or as an
additional Director so long as such appointment does not cause the
number of directors to exceed any maximum number of Directors set
by the Company.
Composition and Independence of the Board, continued
The number of the Directors shall be not less than two and there
shall be no maximum number unless otherwise determined by the
Company by Ordinary Resolution.
The Role of the Board
The Board is the Company's governing body and has overall
responsibility for maximising the Company's performance by
directing and supervising the affairs of the business and meeting
the appropriate interests of shareholders and relevant
stakeholders, while enhancing the value of the Company and ensuring
protection of investors. A summary of the Board's responsibilities
is as follows:
-- statutory obligations and public disclosure
-- strategic matters and financial reporting
-- Appointment and removal of Directors and setting Directors renumeration
-- risk assessment and management including reporting
compliance, governance, monitoring and control and other matters
having a material effect on the Company.
The Board's responsibilities for the Annual Report and Financial
Statements are set out in the Statement of Directors'
Responsibilities on page 18.
Directors' Remuneration
It is the responsibility of the Board as a whole to determine
and approve the Directors' remuneration, having regard to the level
of fees payable to non-executive Directors in the industry
generally, the role that individual Directors fulfil in respect of
Board, Committee responsibilities and the time committed to the
Company's affairs. No individual Director is entitled to vote in
relation to his own remuneration.
Directors undertake to provide services to the Company and be
paid an annual fee for such services in accordance with each
Directors letter of appointment. Details of the Directors'
remuneration can be found in the Directors' Report on page 9.
Board Nominations and Succession
Each of the Directors is responsible for identifying and
nominating for approval of the Board candidates to fill Board
vacancies as and when they arise. The Directors will evaluate the
balance of skills, knowledge, experience and diversity of the Board
to evaluate the profile for any new candidate. The Board may also
use open advertising or engage the services of external advisers to
facilitate the search. The Board also formulates plans for
succession of non-executive directors and the appropriateness of
appointing a senior independent director.
Directors' and Officers' Liability Insurance
The Company has arranged directors' and officers' liability
insurance cover in respect of legal action against its Directors.
The Board will review its insurance cover on a regular basis prior
to the expiry of the policies in effect at the time. The initial
insurance policy is for a 15-month term ending on 24 February
2023.
Relations with Shareholders
The Company is committed to upholding the highest standards of
corporate governance practices and maintaining effective
communication with Shareholders and the financial community.
Prior to the completion of the Business Combination, the
Company's Shareholders, but excluding any holders of restricted
shares (being Public Shares held by the Sponsor or the Directors
which are subject to the Lock-up and Waiver Agreement (see note
12)), shall vote on the proposed Business Combination at a general
Shareholders' meeting of the Company specifically convened for this
purpose, with such a vote requiring the approval of a simple
majority of the votes validly cast (with taking into account any
abstentions) (the "Required Majority") in order to pass. The
Company will not complete the proposed Business Combination unless
the Required Majority approves the proposed Business
Combination.
The annual financial statements will be prepared in pounds
sterling according to accounting standards laid out under
International Financial Reporting Standards as adopted by the EU
("IFRS"). The annual report and financial statements will be
published and available to shareholders within four months of the
accounting date.
Stakeholders, business relationships and socially responsible
investment
The Board strives to understand the views of the Company's key
stakeholders and to take these into consideration as part of its
discussions and decision-making process. As an investment company
the Company does not have any employees and conducts its core
activities through third-party service providers. Each provider has
an established track record and is required to have in place
suitable policies and procedures to ensure it maintains high
standards of business conduct, treats customers fairly, and employs
corporate governance best practice.
Whilst the primary duty of the Directors is owed to the Company
as a whole, all Board discussions involve careful consideration of
the longer-term consequences of any decisions and their
implications for stakeholders. Particular consideration is given to
the continued alignment of interests between the activities of the
Company and those that contribute to delivering the Board's
strategy, which include the Adviser, the Administrator and the
Custodian.
The Board's commitment to maintaining high-standards of
corporate governance; its policy for active Shareholder engagement,
combined with the Directors' duties enshrined in Company law; the
Disclosure Guidance and Transparency Rules; and the Market Abuse
Regulation, all serve to ensure that Shareholders will be provided
with comprehensive information concerning the Company and its
activities.
Section 172 statement
Although the Company is not domiciled in the UK, the Company is
voluntarily meeting any obligations under the 2018 UK Corporate
Governance Code, including section 172 of the Companies Act
2006.
The Directors recognise their individual and collective duty to
act in good faith and in a way that is most likely to promote the
success of the Company for the benefit of its members as a whole,
whilst also having regard, amongst other matters, to the Company's
key stakeholders and the likely consequences of any decisions taken
during the year, as set out below:
The interests of the Company's employees
The Company has no direct employees and maintains close working
relationships with the employees of the Adviser, Administrator and
Custodian who undertake the Company's main functions.
The need to foster the Company's business relationships with
suppliers, customers and others
The Board maintains close working relationships with all key
suppliers and those responsible for delivering the Company's
strategy. The contractual relationship with each supplier and their
performance is formally reviewed each year.
The impact of the Company's operations on the community and the
environment
Objective of the Company is to deliver a private company into
the public domain that has strong corporate governance, is
environmentally focused and socially responsible. Identifying a
target company is key to the decision making process of the Board
when reviewing target companies.
The desirability of the Company maintaining a reputation for
high standards of business conduct
The Chair is responsible for setting expectations concerning the
Company's culture and the Board ensures that its core values of
integrity and accountability are demonstrated in all areas of the
Company's operations.
The need to act fairly between Shareholders of the Company
The Board, in conjunction with the Adviser, will engage actively
with Shareholders, most significantly in their consultations
relating to the Business Combination, which can only be approved by
a majority vote of the Public Shareholders.
Directors' Meetings and Attendance
The Board meets at least quarterly, with the Board meetings and
committee meetings conducted in accordance with the articles of
incorporation of the Company. Attendance at ad hoc meetings via
telephone or video conference links will be permitted where due
notice is given in accordance with the articles of incorporation
and all participants can hear each other clearly. Directors are
encouraged to attend all regular quarterly Board meetings in person
where possible. Board packs for standard quarterly meetings of the
Directors will be circulated at least five days prior to the
meeting unless circumstances dictate otherwise. The Board will
ensure that minutes are taken at each meeting and subsequently
approved by the Board.
Board - formal quarterly Board - additional
Name meetings meetings Audit Committee Other Committee
-------------------------- -------------------------- -------------------------- ---------------- ----------------
Number of meetings held
in the period - 2 - 3
Sir Anthony Salz
(Chairman) - 1 - 1
Dominic Perks - 2 - 3
Matthew Wood - 2 - 3
Sarah Wood - - - -
Dominic Shorthouse - - - 1
Board Committees
Audit Committee
Pursuant to a resolution of the Board, the Company has
established an Audit Committee comprising Matthew Wood (Chair) and
Sarah Wood as its members.
The key objectives of the Audit Committee include a review of
the Annual Report and Financial Statements to ensure they are
prepared to a high standard and comply with all relevant
legislation and guidelines, to monitor the financial reporting and
audit process and to maintain an effective relationship with the
external Auditor.
The Audit Committee considers the Auditor's independence, the
Auditor's terms of engagement and remuneration and any non-audit
services provided by the Auditor. The Committee is also responsible
for reporting to the Board on its review of the Company's system of
internal controls and the identification and management of risks,
and the Company's process for monitoring compliance with laws,
regulations and ethical codes of practice. A report of the Audit
Committee detailing responsibilities and activities is presented on
pages 19 to 20.
The Audit Committee has responsibility for making a
recommendation on the appointment, re-appointment or removal of the
Auditor. Grant Thornton was appointed as the first Auditor of the
Company following a tender process. The Audit Committee has
received and reviewed the audit plan and report from the
Auditor.
The Audit Committee shall meet as often as is deemed necessary,
and at least two times in each full financial year. Due to the
short period between the Company's listing and the period end date,
the Committee did not meet during the period, and held its first
meeting in March 2022.
To assess the effectiveness of the Auditor, the Audit Committee
reviewed:
-- The Auditor's fulfilment of the agreed audit plan and variations from it, if any;
-- The Auditor's assessment of its objectivity and independence as auditor of the Company;
-- The Auditor's report to the Audit Committee highlighting
their significant areas of focus in the conduct of their audit and
findings thereon that arose during the course of the audit; and
-- Feedback from the Investment Manager, Investment Adviser and
Administrator evaluating the performance of the audit team.
For the period ended 31 December 2021, the Audit Committee was
satisfied that there had been appropriate focus and challenge on
the primary areas of audit risk and assessed the quality of the
audit process as good. At this time the Audit Committee does not
recommend putting in place any limit to the tenure of the Auditor
and recommends their reappointment.
Nomination and Remuneration Committees
No remuneration committee or nomination committee will be
constituted prior to any Business Combination. The Board as a whole
will instead review its size, structure and composition and the
scale and structure of the Directors' fees (taking into account the
interests of Shareholders and the performance of the Company).
The Directors are aware that a nomination committee is
recommended by the Governance Code to lead the process for Board
appointments and that the Governance Code recommends that the
majority of the committee be independent non-executive directors.
To the extent that additional individuals may be added to the
Board, the Company may consider setting up a nomination
committee.
Conflicts
It has not been deemed necessary to establish a conflicts
committee. Conflicts procedures relating to the Directors and the
Sponsor are set out in the Articles of Incorporation. To the extent
issues arise, these will be dealt with by the Board, on a
case-by-case basis.
The Company is not prohibited from pursuing a Business
Combination with a business that is affiliated with Hambro Perks or
its affiliates, the Sponsor or the Directors.
In the event the Company seeks to complete the Business
Combination with a Target Business in which one or more of the
Directors (or any of their associates) is a director, or in
relation to which one or more of the Directors has a conflict of
interest, the Articles of Incorporation require that (i) those
Directors do not take part in the Board's consideration of, and do
not vote on, the Business Combination and (ii) the Board obtains
advice from an appropriately qualified and independent adviser that
the Business Combination is fair and reasonable as far as the
Public Shareholders are concerned and publishes a statement to that
effect in the business combination circular.
The Company is not required to obtain any advice, opinion or
valuation from an independent expert in respect of a Business
Combination in any other circumstances.
Internal Control Review and Risk Management System
The Board proposes to follow the guidance published by the UK's
Financial Reporting Council on internal controls, which sets out
that, in determining what constitutes a sound system of internal
controls, a board should consider:
-- the nature and extent of the risks which they regard as
acceptable for the Company to bear within its particular
business;
-- the threat of such risks becoming reality;
-- the Company's ability to reduce the incidence and impact on
business if the risk crystallises; and
-- the costs and benefits resulting from operating relevant controls.
The Board is aware of the need to conduct regular risk
assessments to identify any deficiencies in the controls currently
operating over all aspects of the Company. The Board is responsible
for a formal risk assessment on an annual basis but will also
report by exception of any material changes during the year.
Tenure Policy
The chair should not remain in post beyond nine years from the
date of their first appointment to the Board. To facilitate
effective succession planning and the development of a diverse
board, this period can be extended for a limited time, particularly
in those cases where the chair was an existing non-executive
director on appointment. A clear explanation should be
provided.
Anti-bribery and Corruption
The Board has adopted an anti-bribery and anti-corruption policy
designed to ensure that the Company complies with all applicable
laws, standards and expectations in relation to anti-bribery and
anti-corruption matters.
Criminal Finances Act
The Board of the Company has a zero-tolerance commitment to
preventing persons associated with it from engaging in criminal
facilitation of tax evasion. The Board has satisfied itself in
relation to its key service providers that they have reasonable
provisions in place to prevent the criminal facilitation of tax
evasion by their own associated persons and will not work with
service providers who do not demonstrate the same zero tolerance
commitment to preventing persons associated with it from engaging
in criminal facilitation of tax evasion.
Adviser
The Company appointed Hambro Perks Advisory LLP as its Adviser
on 24 November 2021 for the provision of services in connection
with a potential Business Combination on an ongoing basis until
such time as the Business Combination is completed.
STATEMENT OF DIRECTORS' RESPONSIBILITIES
The Directors are responsible for preparing the Annual Report
and Financial Statements in accordance with applicable laws and
regulations. Guernsey Company Law requires the Directors to prepare
financial statements for each financial year which give a true and
fair view of the state of affairs of the Company and of its profit
or loss for that period.
International Accounting Standard ("IAS") 1 requires that
Financial Statements present fairly for each financial period the
Company's financial position, financial performance and cash flows.
This requires the faithful representation of the effects of
transactions, other events and conditions in accordance with the
definitions and recognition criteria for assets, liabilities,
income, expenses, equity, distributions and cash flows set out in
the International Accounting Standards Board's "Framework for the
preparation and presentation of financial statements". In virtually
all circumstances a fair presentation will be achieved by
compliance with all applicable International Financial Reporting
Standards as adopted by the EU ("IFRS").
In preparing Financial Statements the Directors are required
to:
-- select suitable accounting policies and apply them
consistently;
-- make judgements and estimates that are reasonable and
prudent;
-- state whether applicable accounting standards have been
followed, subject to any material departures disclosed and
explained in the Financial Statements; and
-- prepare the Financial Statements on the going concern basis,
unless it is inappropriate to presume that the Company will
continue in business.
The Directors are also responsible for the keeping of proper
accounting records which disclose with reasonable accuracy at any
time the financial position of the Company and to enable them to
ensure that the Financial Statements comply with IFRS,
interpretations issued by the IFRS Interpretations Committee
("IFRIC") and with the Companies (Guernsey) Law, 2008. They are
also responsible for the system of internal controls, safeguarding
the assets of the Company and hence for taking reasonable steps for
the prevention and detection of fraud and other irregularities.
The Directors confirm that they have complied with these
requirements in preparing the Financial Statements.
The Directors are also responsible for the maintenance and
integrity of the corporate and financial information included on
the Company's website. Legislation in the United Kingdom and
Guernsey governing the preparation and dissemination of financial
statements may differ from legislation in other jurisdictions.
So far as the Directors are aware, there is no relevant audit
information of which the Company's Auditor is unaware, having taken
all the steps the Directors ought to have taken to make themselves
aware of any relevant audit information and to establish that the
Company's Auditor is aware of that information.
Responsibility Statement
Each of the Directors, who are listed on pages 4 to 5, confirms
to the best of each person's knowledge and belief:
-- the Financial Statements, prepared in accordance with IFRS,
give a true and fair view of the assets, liabilities, financial
position and profit of the Company, as required by Disclosure and
Transparency Rule ("DTR") 4.1.12R; and
-- the Management Report (comprising the Company Summary, the
Directors' Report and the Report of the Audit Committee) includes a
fair review of the development and performance of the business
during the period, and the position of the Company at the end of
the year, together with a description of the principal risks and
uncertainties that the Company faces, as required by DTR 4.1.8R and
DTR 4.1.9R.
The Directors consider that the Annual Report, comprising the
Financial Statements and the Management Report, taken as a whole,
is fair, balanced and understandable and provides the information
necessary for Shareholders to make an informed appraisal of the
investment activities and profits and losses of the Company for the
period, and to assess the Company's financial position and
performance, business model and strategy.
Signed on behalf of the Board by:
Sir Anthony Salz
Director
28 June 2022
REPORT OF THE AUDIT COMMITTEE
Pursuant to a resolution of the Board, the Company has
established an Audit Committee comprising Matthew Wood (Chair) and
Sarah Wood as its members.
The members of the Audit Committee are appointed, suspended and
dismissed by the Non-Executive Directors. Executive Directors shall
not be members of the Audit Committee.
The duties of the Audit Committee include:
-- informing the Board of the results of the statutory audit and
explaining how the statutory audit has contributed to the integrity
of the financial reporting and the role the Audit Committee has
fulfilled in this process;
-- monitoring the financial reporting process and making
proposals to safeguard the integrity of the process;
-- monitoring the effectiveness of the internal control systems
and the risk management system with respect to financial
reporting;
-- monitoring the statutory audit of the annual financial
statements, and in particular the process of such audit;
-- monitoring the independence of the external Auditor; and
-- adopting procedures with respect to the selection of the external Auditor.
The Audit Committee shall meet as often as is deemed necessary,
and at least two times in each full financial year. Any member of
the Committee may request a meeting, as may the Company's external
Auditor. Due to the short period between the Company's listing and
the period end date, the Committee did not meet during the period,
and held its first meeting in March 2022.
Financial Reporting and Audit
The Audit Committee has reviewed, considered and recommended to
the Board, the approval of the contents of the Audited Financial
Statements and Annual Report, together with the external Auditor's
report thereon. The Audit Committee focused on compliance with
legal requirements, accounting standards and the relevant Listing
Rules, with specific consideration given to the accurate
classification of the Company's share capital and warrants. The
ultimate responsibility for reviewing and approving the Audited
Financial Statements and Annual Report remains with the Board .
External Auditor
The Audit Committee is responsible for making recommendations on
the appointment, re-appointment or removal of the Auditor. Grant
Thornton UK LLP was appointed as the first Auditor of the Company
following a tender process. Subsequent to the period end, the Audit
Committee received and reviewed the audit plan and report from the
Auditor. Periodically, the Audit Committee may meet privately with
the Auditor without the Company's advisers being present.
To assess the effectiveness of the Auditor, the Audit Committee
reviewed:
-- The Auditor's fulfilment of the agreed audit plan and variations from it;
-- The Auditor's report to the Audit Committee highlighting the
major issues that arose during the course
of the audit; and
-- Feedback from the Company's Adviser and Administrator
evaluating the performance of the audit team.
The Audit Committee noted that non-audit services had been
provided to the Company by the Auditor in the form of services as
Reporting Accountant, in respect of which the Auditor had been paid
a fee of GBP134,930, which posed a potential threat to the
Auditor's independence.
To fulfil its responsibility regarding the independence of the
Auditor, the Audit Committee considered a report from the Auditor
describing its arrangements to identify, report and manage any
conflicts of interest.
The Audit Committee was satisfied, given that the work of the
Reporting Accountant took place before its appointment as Auditor,
that such work was a non-recurring service, and that no work
performed in its role as Reporting Accountant would be used for the
audit, that appropriate safeguards are in place to ensure that
there is no impairment to the Auditor's objectivity and
independence.
The remuneration to Grant Thornton UK LLP and to other Grant
Thornton member firms for audit of the Company's annual financial
statements amounts to GBP97,850.
Internal controls
The Audit Committee is responsible for ensuring that an
effective system of internal financial and non-financial controls
and risk management is maintained, and for reviewing and monitoring
the effectiveness of those controls. The controls are designed to
ensure proper accounting records are maintained, that the financial
information on which the business decisions are made and which is
issued for publication is reliable, and that the assets of the
Company are safeguarded. Such a system of internal financial
controls can only provide reasonable and not absolute assurance
against misstatement or loss. The Adviser, Administrator and
Custodian together will maintain a system of internal control on
which they will report to the Audit Committee. The Audit Committee
has considered the need for an internal audit function, and has
concluded that, given that the Company has no employees and little
activity as it is currently constituted, such a level of oversight
is not currently required. The Committee notes that the Adviser,
Administrator and Custodian maintain systems of internal control on
which they will be required to report to the Board, in order to
provide sufficient assurance to the Company that a sound system of
risk management and internal control, which safeguards
Shareholders' investment and the Company's assets, is
maintained.
The Audit Committee has considered non-financial areas of risk
such as disaster recovery and staffing levels of its service
providers, and considers that adequate arrangements are in
place.
On behalf of the Audit Committee
Matthew Wood
Audit Committee Chair
28 June 2022
Opinion
Our opinion on the financial statements is unmodified
We have audited the financial statements of Hambro Perks Acquisition
Company Limited (the 'company') for the period ended 31 December 2021,
which comprise the Statement of Comprehensive Income, Statement of Financial
Position, Statement of Changes in Equity and Statement of Cash Flows
and notes to the financial statements, including a summary of significant
accounting policies. The financial reporting framework that has been
applied in their preparation is applicable law and International Financial
Reporting Standards (IFRSs) as adopted by the European Union.
In our opinion, the financial statements:
* give a true and fair view of the state of the
company's affairs as at 31 December 2021 and of its
profit for the period then ended;
* have been properly prepared in accordance with
International Financial Reporting Standards as
adopted by the European Union; and
* have been prepared in accordance with the
requirements of the Companies (Guernsey) Law 2008.
Basis for opinion
We conducted our audit in accordance with International
Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our
responsibilities under those standards are further described in the
'Auditor's responsibilities for the audit of the financial
statements' section of our report. We are independent of the
company in accordance with the ethical requirements that are
relevant to our audit of the financial statements in the UK,
including the FRC's Ethical Standard, and we have fulfilled our
other ethical responsibilities in accordance with these
requirements. We believe that the audit evidence we have obtained
is sufficient and appropriate to provide a basis for our
opinion.
Conclusions relating to going concern
We are responsible for concluding on the appropriateness of the
directors' use of the going concern basis of accounting and, based
on the audit evidence obtained, whether a material uncertainty
exists related to events or conditions that may cast significant
doubt on the company's ability to continue as a going concern. If
we conclude that a material uncertainty exists, we are required to
draw attention in our report to the related disclosures in the
financial statements or, if such disclosures are inadequate, to
modify the auditor's opinion. Our conclusions are based on the
audit evidence obtained up to the date of our report. However,
future events or conditions may cause the company to cease to
continue as a going concern.
As part of our risk assessment, we evaluated the company's cash
position, assessed the company's performance throughout the period
and forecasted expenses over the going concern period and concluded
that the company's ability to continue as a going concern was not a
significant risk that required special audit consideration.
Our evaluation of the directors' assessment of the company's
ability to continue to adopt the going concern basis of accounting
included analysing management's base case cash flow forecasts
covering the period to 30 June 2023, challenging the underlying
assumptions and examining forecast expenditure throughout the going
concern period. We have challenged management to understand how the
excess cash in the forecast would be utilised. We challenged
management on the use of funds in any potential aborted
transactions to determine if there would still be sufficient funds
remaining to continue as a going concern. We obtained management's
downside scenarios prepared to consider the possibilities that
would result in a nil cash position during the going concern period
and evaluated the impact and availability of mitigating actions
available to management to avoid this outcome. Our assessment also
included an assessment of the adequacy of related disclosures
within the annual report.
In our evaluation of the directors' conclusions, we considered
the inherent risks associated with the company's business model
including effects arising from macro-economic uncertainties such as
Brexit and Covid-19, we assessed and challenged the reasonableness
of estimates made by the directors and the related disclosures and
analysed how those risks might affect the company's financial
resources or ability to continue operations over the going concern
period.
Based on the work we have performed, we have not identified any
material uncertainties relating to events or conditions that,
individually or collectively, may cast significant doubt on the
company's ability to continue as a going concern for a period of at
least twelve months from when the financial statements are
authorised for issue.
In auditing the financial statements, we have concluded that the
directors' use of the going concern basis of accounting in the
preparation of the financial statements is appropriate.
The responsibilities of the directors with respect to going
concern are described in the 'Responsibilities of directors for the
financial statements' section of this report.
Our approach to the audit
1 Overview of our audit approach
Overall materiality: GBP382,000, which represents
0.25% of the company's total assets.
The following key audit matter was identified:
* accounting treatment and presentation of complex
financial instruments
This is the first accounting period in which
we are providing an audit opinion as the company
only incorporated during the period.
We have audited the entity using the above materiality
scope. There are no branches or subsidiaries,
and no component auditors were used to perform
our audit.
-------------------------------------------------------------
Key audit matters
Key audit matters are those matters that, in our professional
judgement, were of most significance in our audit of the financial
statements of the current period and include the most significant
assessed risks of material misstatement (whether or not due to
fraud) that we identified. These matters included those that had
the greatest effect on: the overall audit strategy; the allocation
of resources in the audit; and directing the efforts of the
engagement team. These matters were addressed in the context of our
audit of the financial statements as a whole, and in forming our
opinion thereon, and we do not provide a separate opinion on these
matters.
In the graph below, we have presented the key audit matters,
significant risks and other risks relevant to the audit.
Key Audit Matter How our scope addressed the matter
============================================================== ============================================================
Accounting Treatment and
Presentation of Complex * In responding to the key audit matter, our audit work
Financial Instruments included but was not restricted to:
We identified the accounting
treatment and presentation
of the shares and warrants * Considering the appropriateness of the accounting
issued in the year as the policy for the public shares, by checking whether it
most significant assessed is in accordance with the financial reporting
risk of material misstatement framework, including IAS 32;
due to error.
The company issued public
shares and warrants in the * The audit team challenged management's treatment of
period, generating funds the issue of public shares as a financial liability
of GBP150m to be used in rather than equity instrument in accordance with IAS
a future business combination. 32;
There is a risk that due
to the complexity of the
financial instrument, the * Key assumptions around the substance and timing of
public shares, public warrants, the cash payment in relation to the redemption of
sponsor warrants and sponsor public shares were identified and corroborated back
shares are not accounted to the Prospectus;
for in line with required
accounting standards.
Furthermore, there is also * Inspection and detailed analysis of the Sponsor
a risk that the shares and Purchase Agreement to assess whether the issue of
warrants issued to the Sponsor shares and warrants to the Sponsor in fact
may actually constitute constituted share-based payments, representing the
a share-based payment transaction issue of shares for services relating to the
and therefore should be acquisition, or the advice and research provided in
accounted for accordingly. advance of an acquisition.
Management judgement is
required when assessing
the substance of the transaction * Considering the appropriateness of the accounting
with the Sponsor, with the policy for the Sponsor shares and warrants, by
key assumption relating checking whether it is in accordance with the
to whether the issue of financial reporting framework, including IFRS 2 Share
these financial instruments based payments and IAS 32;
was in fact in exchange
for services.
* Corroboration of management key assumptions about the
substance of the agreement, any favourable terms upon
which the Sponsor shares were issued, and other key
assumptions made by management in their assessment
were reasonable.
* We challenged management on the fair value attributed
to the warrants that were issued during the fund
raise
* The engagement team assessed the competence and
objectivity of management's experts used to calculate
the fair value of the warrants at issue date and
yearend.
* For items carried at fair value through profit and
loss, the engagement team utilized our own internal
specialists to assist in the audit of the fair value
of these instruments which included performing shadow
calculations.
Relevant disclosures in the Our results
Annual Report and Accounts
2021 Management has made appropriate adjustments
* Financial statements: Note 1, General information and to their financial instrument balances
significant accounting policies and Note 7 Issued as a result of our audit work. No other
Share Capital and, Note 8 Warrants. material misstatements were identified
in the accounting treatment or disclosure
of financial instruments.
* Audit and Risk Committee Report: Pages 19 to 20.
Our application of materiality
We apply the concept of materiality both in planning and
performing the audit, and in evaluating the effect of identified
misstatements on the audit and of uncorrected misstatements, if
any, on the financial statements and in forming the opinion in the
auditor's report.
Materiality was determined as follows:
Materiality Company
measure
======================== =============================================================
Materiality We define materiality as the magnitude of misstatement
for financial in the financial statements that, individually
statements as or in the aggregate, could reasonably be expected
a whole to influence the economic decisions of the users
of these financial statements. We use materiality
in determining the nature, timing and extent
of our audit work.
======================== ===============================================================
Materiality threshold GBP382,000 which is 0.25% of total assets.
Significant judgements This benchmark is considered the most appropriate
made by auditor because the entity is a special purpose acquisition
in determining company, established to enact business combination.
the materiality We therefore felt the most critical measure
of the business for shareholders would be total
assets. We considered whether a profit or loss-based
materiality would be appropriate and concluded
that this would result in an inappropriately
low materiality and would not be reflective
of the company's activity in the period.
Given the current uncertainties in the macro-economic
environment and the fact that this is the first
operating period and first period under audit,
a percentage of 0.25% of the total assets benchmark
has been applied.
Performance We set performance materiality at an amount
materiality used less than materiality for the financial statements
to drive the as a whole to reduce to an appropriately low
extent of our level the probability that the aggregate of
testing uncorrected and undetected misstatements exceeds
materiality for the financial statements as
a whole.
======================== ===============================================================
Performance materiality GBP248,300 which is 65% of financial statement
threshold materiality.
Significant judgements In determining performance materiality, we made
made by auditor the following significant judgements:
in determining * This is our first period of audit, therefore with no
the performance expectation based on historic audits in relation to
materiality the number or quantum of potential misstatements; and
* Our assessment of the strength and effectiveness of
the control environment.
Specific materiality We determine specific materiality for one or
more particular classes of transactions, account
balances or disclosures for which misstatements
of lesser amounts than materiality for the financial
statements as a whole could reasonably be expected
to influence the economic decisions of users
taken on the basis of the financial statements.
======================== ===============================================================
Specific materiality We determined a lower level of specific materiality
for the following areas:
* Related party transactions; and
* Directors' remuneration
======================== ===============================================================
Communication We determine a threshold for reporting unadjusted
of misstatements differences to the audit committee.
to the audit
committee
======================== ===============================================================
Threshold for GBP19,100 and misstatements below that threshold
communication that, in our view, warrant reporting on qualitative
grounds.
======================== ===============================================================
The graph below illustrates how performance materiality
interacts with our overall materiality and the tolerance for
potential uncorrected misstatements.
An overview of the scope of our audit
We performed a risk-based audit that requires an understanding
of the company's business and in particular matters related to:
Understanding the company its environment, including the
controls
The engagement team obtained an understanding of company and its
environment, including the controls, and assessed the risks of
material misstatement;
Work to be performed on financial information of the company
-- The entity has been subjected to an audit of the financial
statements using a determined materiality;
-- Obtaining an understanding of the control environment of the
entity. No reliance has been placed on the design or operating
effectiveness of internal control;
-- Performing substantive testing on the material account
balances and transactions: cash and escrow accounts, receivables
and payables, public share and derivative liabilities, share
capital and reserves, expenses and other liabilities.
Other information
The directors are responsible for the other information. The
other information comprises the information included in the annual
report, other than the financial statements and our auditor's
report thereon. Our opinion on the financial statements does not
cover the other information and, except to the extent otherwise
explicitly stated in our report, we do not express any form of
assurance conclusion thereon.
In connection with our audit of the financial statements, our
responsibility is to read the other information and, in doing so,
consider whether the other information is materially inconsistent
with the financial statements, or our knowledge obtained in the
audit or otherwise appears to be materially misstated. If we
identify such material inconsistencies or apparent material
misstatements, we are required to determine whether there is a
material misstatement in the financial statements or a material
misstatement of the other information. If, based on the work we
have performed, we conclude that there is a material misstatement
of this other information, we are required to report that fact.
We have nothing to report in this regard.
Matters on which we are required to report by exception
We have nothing to report in respect of the following matters in
relation to which the Companies (Guernsey) Law, 2008 requires us to
report to you if, in our opinion:
-- proper accounting records have not been kept by the company; or
-- the company's financial statements are not in agreement with
the accounting records and returns; or
-- we have not obtained all the information and explanations,
which to the best of our knowledge and belief, are necessary for
the purposes of our audit.
Corporate governance statement
The Listing Rules require us to review the directors' statement
in relation to going concern, longer-term viability and that part
of the Corporate Governance Statement relating to the company's
compliance with the provisions of the UK Corporate Governance Code
specified for our review. The Company is not required to apply the
UK Corporate Governance Code; however, they have chosen to apply
this code and have explained within their Corporate Governance
Statement where they do not comply.
Based on the work undertaken as part of our audit, we have
concluded that each of the following elements of the Corporate
Governance Statement is materially consistent with the financial
statements, or our knowledge obtained during the audit:
-- the directors' statement in the financial statements about
whether the directors considered it appropriate to adopt the going
concern basis of accounting in preparing the financial statements
and the directors' identification of any material uncertainties to
the company's ability to continue to do so over a period of at
least twelve months from the date of approval of the financial
statements;
-- the directors' explanation in the annual report as to how
they have assessed the prospects of the company, over what period
they have done so and why they consider that period to be
appropriate, and their statement as to whether they have a
reasonable expectation that the company will be able to continue in
operation and meet their liabilities as they fall due over the
period of their assessment, including any related disclosures
drawing attention to any necessary qualifications or
assumptions;
-- the directors' statement that they consider the annual report
and financial statements taken as a whole is fair, balanced and
understandable and provides the information necessary for
shareholders to assess the company's performance, business model
and strategy;
-- the directors' confirmation in the annual report that they
have carried out a robust assessment of the principal and emerging
risks facing the company, including the impact of Covid-19, and the
disclosures in the annual report that describe the principal risks,
procedures to identify emerging risks and an explanation of how
they are being managed or mitigated;
-- the section of the annual report that describes the review of
the effectiveness of company's risk management and internal control
systems, covering all material controls, including financial,
operational and compliance controls; and
-- the section of the annual report describing the work of the
audit committee, including significant issues that the audit
committee considered relating to the financial statements and how
these issues were addressed.
Responsibilities of directors for the financial statements
As explained more fully in the directors' responsibilities
statement, the directors are responsible for the preparation of the
financial statements and for being satisfied that they give a true
and fair view, and for such internal control as the directors
determine is necessary to enable the preparation of financial
statements that are free from material misstatement, whether due to
fraud or error.
In preparing the financial statements, the directors are
responsible for assessing the company's ability to continue as a
going concern, disclosing, as applicable, matters related to going
concern and using the going concern basis of accounting unless the
directors either intend to liquidate the company or to cease
operations, or have no realistic alternative but to do so.
Auditor's responsibilities for the audit of the financial
statements
Our objectives are to obtain reasonable assurance about whether
the financial statements as a whole are free from material
misstatement, whether due to fraud or error, and to issue an
auditor's report that includes our opinion. Reasonable assurance is
a high level of assurance but is not a guarantee that an audit
conducted in accordance with ISAs (UK) will always detect a
material misstatement when it exists.
Misstatements can arise from fraud or error and are considered
material if, individually or in the aggregate, they could
reasonably be expected to influence the economic decisions of users
taken on the basis of these financial statements.
A further description of our responsibilities for the audit of
the financial statements is located on the Financial Reporting
Council's website at: www.frc.org.uk/auditorsresponsibilities .
This description forms part of our auditor's report.
Explanation as to what extent the audit was considered capable
of detecting irregularities, including fraud
Irregularities, including fraud, are instances of non-compliance
with laws and regulations. We design procedures in line with our
responsibilities, outlined above, to detect material misstatements
in respect of irregularities, including fraud. Owing to the
inherent limitations of an audit, there is an unavoidable risk that
material misstatements in the financial statements may not be
detected, even though the audit is properly planned and performed
in accordance with the ISAs (UK).
The extent to which our procedures are capable of detecting
irregularities, including fraud is detailed below:
-- We obtained an understanding of the legal and regulatory
frameworks applicable to the parent company and the industry in
which they operate. We determined that the following laws and
regulations were most significant: international accounting
standards as adopted by the European Union, Listing Rules, The
Companies (Guernsey) Law, 2008, and the UK Corporate Governance
Code.
-- We obtained an understanding of how the company is complying
with those legal and regulatory frameworks by making inquiries of
management, inquiring with those responsible for legal and
compliance procedures and with the company secretary. We
corroborated our inquiries through our review of board minutes and
papers provided to the Audit Committee.
-- We evaluated the design and implementation of controls over
the financial reporting systems and the effectiveness of the
control environment as part of our risk assessment.
-- We assessed the susceptibility of the company's financial
statements to material misstatement, including how fraud might
occur. Audit procedures performed included:
- Identifying and assessing the design effectiveness of controls
management has in place to prevent and detect fraud;
- Understanding how those charged with governance considered and
addressed the potential for override of controls or other
inappropriate influence over the financial reporting process;
- Identifying and testing journal entries posted in the year which were deemed to be unusual.
-- These audit procedures were designed to provide reasonable
assurance that the financial statements were free from fraud or
error. The risk of not detecting a material misstatement due to
fraud is higher than the risk of not detecting one resulting from
error and detecting irregularities that result from fraud is
inherently more difficult than detecting those that result from
error, as fraud may involve collusion, deliberate concealment,
forgery or intentional misrepresentations. Also, the further
removed non-compliance with laws and regulations is from events and
transactions reflected in the financial statements, the less likely
we would become aware of it;
-- The engagement partner assessed whether the engagement team
collectively had the appropriate competence and capabilities to
identify and recognise non-compliance with laws and regulations
through an assessment of the engagement team's:
- Understanding of, and practical experience with, audit
engagements of a similar nature and complexity, through appropriate
training and participation; and
- Knowledge of the industry in which the company operates.
-- We note that there is no specific industry legislation that
significantly impacts Hambro Perks Acquisition Company Limited, and
the engagement team are deemed to hold appropriate competence and
capabilities to identify non-compliance with laws and
regulations.
Other matters which we are required to address
Following the recommendation of the audit committee, we were
appointed by the Board on 24 November 2021 to audit the financial
statements for the period ended 31 December 2021 and subsequent
financial periods.
This is the first period of engagement.
The non-audit services prohibited by the FRC's Ethical Standard
were not provided to the company and we remain independent of the
company in conducting our audit.
Our audit opinion is consistent with the additional report to
the audit committee.
Use of our report
This report is made solely to the company's members, as a body,
in accordance with Section 262 of The Companies (Guernsey) Law
2008. Our audit work has been undertaken so that we might state to
the company's members those matters we are required to state to
them in an auditor's report and for no other purpose. To the
fullest extent permitted by law, we do not accept or assume
responsibility to anyone other than the company and the company's
members as a body, for our audit work, for this report, or for the
opinions we have formed.
Christopher Raab, ACA
Senior Statutory Auditor
for and on behalf of Grant Thornton UK LLP
Statutory Auditor, Chartered Accountants
London
28 June 2022
STATEMENT OF COMPREHENSIVE INCOME
For the period from 14 April 2021 to 31 December 2021
For the period from
14 April 2021 to
Note 31 December 2021
GBP
Income
Bank interest income 7,124
Gain on derivative instruments 8 2,214,250
Total income 2,221,374
----------------
Expenses
Administration fees 13 (3,041)
Advisory fees 13 (12,000)
Audit fee 11 (97,850)
Company Secretarial fees (2,082)
Directors' fees 13 (20,164)
D&O Insurance (27,138)
LSE fees (1,150)
Share issue costs (256,360)
Sundry expenses (814)
----------------
Total operating expenses (420,599)
Finance expense 7 (717,752)
Profit for the period before tax 1,083,023
----------------
Withholding tax (2,137)
Total comprehensive income for the period 1,080,886
----------------
Basic earnings per Share 10 GBP2.03
Diluted earnings per Share 10 GBP2.03
----------------
The Company does not have other comprehensive income for the
year and therefore the total comprehensive income is also the
income for the period.
All items in the above statement derive from continuing
operations.
The accompanying notes on pages 33 to 48 form an integral part
of these Financial Statements.
STATEMENT OF FINANCIAL POSITION
As at 31 December 2021
Notes 31 December 2021
GBP
Current assets
Restricted cash 6 150,146,837
Cash and cash equivalents 6 1,657,916
Other receivables 9 1,000,000
----------------
Total assets 152,804,753
----------------
Non-current liabilities:
Redeemable Public Share liabilities 7 138,139,433
Current liabilities:
Derivative liabilities 8 7,888,266
Other payables 425,154
Total liabilities 146,452,853
----------------
Equity
Share capital 7 3,604,764
Other reserves 8 1,666,250
Retained earnings 1,080,886
----------------
Total equity 6,351,900
----------------
Total equity and liabilities 152,804,753
----------------
The Financial Statements on pages 29 to 48 were approved and
authorised for issue by the Board of Directors
on 28 June 2022 and signed on its behalf by:
Sir Anthony Salz
Director
The accompanying notes on pages 33 to 48 form an integral part
of these Financial Statements.
STATEMENT OF CHANGES IN EQUITY
For the period from 14 April 2021 to 31 December 2021
Note Share Retained
capital Other reserves earnings Total
GBP GBP GBP GBP
As at 14 April
2021 - - - -
Issue of share
capital and sponsor
warrants 7,8 3,604,764 1,666,250 - 5,271,014
Total comprehensive
profit for the
period - - 1,080,886 1,080,886
As at 31 December
2021 3,604,764 1,666,250 1,080,886 6,351,900
---------- --------------- ---------- ----------
Sponsor warrants have been accounted for as a capital
contribution in other reserves. Please see notes 2 and 8 for
further details.
The accompanying notes on pages 33 to 48 form an integral part
of these Financial Statements.
STATEMENT OF CASH FLOWS
For the period from 14 April 2021 to 31 December 2021
For the period
from 14 April
2021 to
Note 31 December 2021
GBP
Cash flows from operating activities
Profit for the period 1,080,886
Adjustments for:
Gain on derivative 8 (2,214,250)
Finance expense 7 717,752
Increase in other payables (excluding
share issue costs) 164,220
------------------
Net cash outflows from operating activities (251,392)
------------------
Cash flows from financing activities
Issue of Public Shares 7 150,141,850
Issue of Sponsor Shares 7 36,620
Issue of Sponsor Warrants 8 6,331,977
Issue costs settled during the period (3,454,302)
------------------
Net cash inflows from financing activities 153,056,145
------------------
Cash flows from investing activities
Increase in restricted cash 6 (150,146,837)
Increase in other receivables 9 (1,000,000)
Net cash inflows from investing activities (151,146,837)
Net increase in cash and cash equivalents 1,657,916
Cash and cash equivalents at beginning
of period -
Cash and cash equivalents at end of
period 6 1,657,916
------------------
The accompanying notes on pages 33 to 48 form an integral part
of these Financial Statements.
NOTES TO THE FINANCIAL STATEMENTS
For the period from 14 April 2021 to 31 December 2021
1. General information
Hambro Perks Acquisition Company Limited (the "Company") was
incorporated and registered in Guernsey under The Companies
(Guernsey) Law, 2008 on 14 April 2021 with a registration number
69093 as a special purpose acquisition company ("SPAC")
incorporated for the purpose of acquiring a majority (or otherwise
controlling) stake in a company or operating business (the "Target"
or "Target Business") through a merger, capital stock exchange,
share purchase, asset acquisition, realisation or similar
transaction (a "Business Combination"). The Company intends to
focus on the technology-enabled sector and businesses with
principal business operations in the United Kingdom.
The Financial Statements of the Company (the "Financial
Statements") are prepared in accordance with International
Financial Reporting Standards as adopted by the EU ("IFRS"),
interpretations issued by the IFRS Interpretations Committee
("IFRIC"), with the Companies (Guernsey) Law, 2008 and the main
market listing rules.
2. Principal accounting policies
The Company is not presently engaged in any activities other
than those which are required in connection with the selection,
structuring and completion of an acquisition in a target business
by means of a merger, share exchange, share purchase, contribution
in kind, asset acquisition or combination of these methods (a
"Business Combination").
The Financial Statements have been prepared in accordance with
applicable law, the Company's principal documents and International
Financial Reporting Standards ("IFRS").
The Financial Statements are presented in Pounds Sterling, which
is the Company's functional and presentational currency, and has
been prepared under the historical cost convention, rounded to the
nearest whole Pound Sterling.
The Company had no operations and therefore no segmental
information is presented.
The following accounting policies have been applied consistently
in dealing with items which are considered material in relation to
the Company's Financial Statements:
Basis of preparation
The Company's Financial Statements have been prepared on a
historical cost basis, as modified by the revaluation of financial
instruments measured at fair value through profit or loss.
The preparation of Financial Statements requires the Company to
make estimates and assumptions that affect the reported amounts of
assets and liabilities at the date of the Financial Statements and
the reported amounts of revenues and expenses during the reporting
period. Actual results could differ from those estimates.
Significant estimates and judgements are discussed further below
and the principal accounting policies adopted are also set out
below.
The Directors consider that the Annual Report, comprising the
Financial Statements and the Management Report, taken as a whole,
is fair, balanced and understandable and provides the information
necessary for Shareholders to make an informed appraisal of the
investment activities and profits and losses of the Company for the
period, and to assess the Company's financial position and
performance, business model and strategy.
Going Concern
The Board has assessed the Company's financial position as at 31
December 2021 and the factors that may impact the Company for a
period of 12 months from the date of signing of these Financial
Statements.
In particular, the Board has reviewed the Company's committed
expenses for the period which leaves a significant cash buffer in
excess of GBP1.07 million. As these committed expenses are in line
with signed engagement letters or agreements, the Board takes
comfort that these expenses can be reliably measured and factored
into their budgeting.
For the period 14 April 2021 to 31 December 2021
2. Principal accounting policies, continued
Basis of preparation, continued
Going Concern, continued
The cash buffer would be utilised in the event of any aborted
deal however, the Board considers the likelihood of such an event
to be low and if it should occur, would likely be in the early
stages of any potential transaction where the costs incurred would
be below GBP0.5 million.
The Board has also looked further forward for the period up to
August 2023, a period in which it is expected that a Business
Combination will have taken place in which case, the acquired
company will cover the costs of acquisition.
In addition, the Board has noted that the Company's policy is
that no dividend will be declared until after a successful Business
Combination to ensure that capital is maintained in the period
prior to the Business Combination.
The Board is satisfied that the Company has adequate resources
to continue in operation for the foreseeable future and to meet its
liabilities as and when they fall due. The Directors also note that
the Company's operations have not been significantly affected by
the Covid-19 pandemic. Accordingly, the Board is of the opinion
that it is appropriate to prepare these Financial Statements on a
going concern basis.
Basis of measurement
Functional and presentation currency
The Financial Statements of the Company are presented in the
currency of the primary economic environment in which the Company
operates (its functional currency). The Directors have considered
the primary economic currency of the Company; the currency in which
the original finance was raised; the currency in which
distributions will be made; and ultimately what currency would be
returned to Shareholders if the Company is wound up. The Directors
believe that British Pounds ("GBP") best represents the functional
currency of the Company during the year. Therefore, the books and
records are maintained in GBP. For the purpose of the Financial
Statements, the results and financial position of the Company are
presented in GBP, which has been selected as the presentation
currency of the Company.
Transactions and balances
Foreign currency transactions are translated into the functional
currency using the exchange rates prevailing at the dates of the
transactions. Foreign currency monetary assets and liabilities at
the period end are translated into the functional currency at the
exchange rates prevailing at the period end date. Foreign exchange
gains and losses resulting from the settlement of such transactions
and from the translation at year end exchange rates of monetary
assets and liabilities denominated in foreign currencies are
recognised in the Statement of Comprehensive Income.
Non-monetary items measured at historical cost are translated
using the exchange rates at the date of the transaction.
Non-monetary items measured at fair value are translated using the
exchange rates at the date when fair value was determined.
Fair value measurement
All financial instruments for which fair value is recognised or
disclosed are categorised within the fair value hierarchy, which
consists of the following 3 levels:
-- Level 1 - unadjusted quoted prices in active markets for
identical, unrestricted assets or liabilities;
-- Level 2 - quoted prices in markets that are not active, or
financial instruments for which all significant inputs
are observable from the market, either directly (as prices) or
indirectly (as derived from prices); and
-- Level 3 - prices or valuations that require inputs that are
not based on observable market data (unobservable
inputs).
The Board considers observable data to be market data that is
readily available, regularly distributed
or updated, reliable and verifiable, not proprietary, and
provided by independent sources that are actively involved
in the relevant market.
NOTES TO THE FINANCIAL STATEMENTS, continued
For the period 14 April 2021 to 31 December 2021
Fair value measurement, continued
The table below analyses within the fair value hierarchy the
company's financial instruments:
31 December 2021 Level
Level 1 2 Level 3 Total
GBP GBP GBP GBP
Derivative Liabilities - - 7,888,266 7,888,266
Investments whose values are based simply on quoted market
prices in active markets are classified within level 1. At 31
December 2021, it was the opinion of the Investment Board that the
Public Shares should be categorised as level 1.
Financial instruments that trade in markets that are not
considered to be active but are valued based on quoted market
prices, dealer quotations or alternative pricing sources supported
by observable inputs would be classified within level 2. As level 2
investments include positions that are not traded in active
markets, and/or are subject to transfer restrictions, valuations
are discounted to reflect illiquidity and/or non-transferability,
which are generally based on available market information. At 31
December 2021, it was the opinion of the Board that no financial
instruments were categorised as level 2.
Investments classified within level 3 have significant
unobservable inputs as they trade infrequently. As observable
prices are not available for the investments, the Investment
Manager uses valuation techniques to derive their fair value. At 31
December 2021, it was the opinion of the Board that the Warrants
should be categorised as level 3.
The following summarises the valuation methodologies and inputs
used for derivative liabilities categorised in Level 3.
31 December 2021 Valuation Unobservable
Fair value combined methodologies inputs
Private equity
investments GBP
Derivative Liabilities 7,888,266 Black Scholes Option Volatility
Pricing Method Years to
expiration
The following table provides information about the sensitivity
of the year end fair value measurement to changes in the most
significant inputs:
Sensitivity of the fair
Description Significant unobservable Estimate value measurement of the
input of the input input
Derivative Liabilities Volatility 8.7% An increase to 9.7% (decrease
to 7.7%) would increase
(decrease) fair value by
GBP1,522,297 (GBP1,245,516).
Derivative Liabilities Years to expiration 6 years, Decrease by 6 months (Business
8 months Combination occurs at end
of 15 month initial period)
the fair value would decrease
by GBP465,780.
For the period 14 April 2021 to 31 December 2021
2. Principal Accounting Policies, continued
New and amended accounting standards
At the date of authorisation of these financial statements, the
following relevant standards and interpretations, which have not
been applied in these financial statements, were in issue but not
yet effective:
-- IAS 1 (amended), "Presentation of Financial Statements"
(amendments regarding the classification of liabilities, effective
for periods commencing on or after 1 January 2023).
-- Amendments to IFRS 3,' Business combinations' (effective for
periods commencing on or after 1 January 2022) - The amendment adds
a requirement that, for transactions and other events within the
scope of IAS 37 or IFRIC 21, an acquirer applies IAS 37 or IFRIC 21
(instead of the Conceptual Framework) to identify the liabilities
it has assumed in a business combination and adds an explicit
statement that an acquirer does not recognise contingent assets
acquired in a business combination.
-- Amendments to IAS 16, 'Property, plant and equipment'
(effective for periods commencing on or after 1 January 2022) -
Proceeds before Intended Use - The amendment to IAS 16 Property,
Plant and Equipment (PP&E) prohibits an entity from deducting
from the cost of an item of PP&E any proceeds received from
selling items produced while the entity is preparing the asset for
its intended use. It also clarifies that an entity is technical and
physical performance of the asset. The financial performance of the
asset is not relevant to this assessment. Entities must disclose
separately the amounts of proceeds and costs relating to items
produced that are not an output of the entity's ordinary
activities.
-- Amendments to IAS 37, 'Provisions, contingent liabilities and
contingent assets' (effective for periods commencing on or after 1
January 2022) - The changes in Onerous Contracts - Cost of
Fulfilling a Contract specify that the 'cost of fulfilling' a
contract comprises the 'costs that relate directly to the
contract'.
-- Annual Improvements to IFRS Standards 2018-2020 (effective
for periods commencing on or after 1 January 2022). In regard to
IFRS 9, the amendment clarifies which fees an entity includes when
it applies the '10 per cent' test in assessing whether to
derecognise a financial liability.
The Directors expect that the adoption of these amended
standards in a future period will not have a material impact on the
Company's audited Consolidated Financial Statements.
The Company recognises financial assets when the entity becomes
a party to the contractual provisions of the instrument.
Financial assets at amortised cost
Financial assets at amortised cost, which includes other
receivables, amounts held in escrow and cash and bank balances, are
initially recognised at their fair value at the date of the
transaction and are subsequently measured at amortised cost using
the effective interest rate method. Cash and cash equivalents are
defined as cash in hand, demand deposits and highly liquid
investments readily convertible to known amounts of cash and
subject to insignificant risk of changes in value. Cash and cash
equivalents consist of cash at bank and deposits with a maturity of
less than three months at the date of inception.
Amounts held in escrow are made up of the proceeds of the
Placing, Overfunding Subscription, Over-allotment Overfunding
Subscription and Over-allotment Placing. Any interest earned is
also included. Pursuant to the terms of the Escrow Agreement and in
accordance with the requirements set out in Listing Rule
5.6.18A(2), the Company may only direct the release of funds upon
the occurrence of certain payment events further detailed in note
6.
Subsequent measurement
Financial assets at amortised cost are subsequently carried at
amortised cost using the effective interest rate method. The
amortised cost of a financial asset is the amount at which the
financial asset is measured on initial recognition, minus principal
repayments, plus or minus the cumulative amortisation using the
effective interest method of any difference between the initial
amount recognised and the maturity amount, minus any allowance for
expected credit losses.
For the period 14 April 2021 to 31 December 2021
2. Principal Accounting Policies, continued
Financial assets at amortised cost, continued
Subsequent measurement, continued
At each reporting date, the Company measures the loss allowance
on financial assets carried at amortised cost at an amount equal to
the lifetime expected credit losses, if the credit risk has
increased significantly since initial recognition. If, at the
reporting date, the credit risk has not increased significantly
since initial recognition, the Company measures the loss allowance
at an amount equal to 12-month expected credit losses. The expected
credit losses are estimated based on the Company's historical
credit loss experience, adjusted for factors that are specific to
the financial asset, general economic conditions and an assessment
of both the current as well as the forecast direction of conditions
at the reporting date, including the time value of money where
appropriate.
The measurement of expected credit losses is a function of the
probability of default, loss given default (i.e. the magnitude of
the loss if there is a default) and exposure at the default. The
assessment of the probability of default and loss given default is
based on historical data adjusted by forward-looking
information.
Cash and bank balances and other receivables are undiscounted.
Due to their short-term nature the discounting impact is not
regarded as material.
Allowances for expected credit losses are recognised in profit
or loss in the Statement of Comprehensive Income.
Derecognition
Financial assets are derecognised when (a) the contractual
rights to the cash flows from the asset expire or are settled, or
(b) substantially all the risks and rewards of the ownership of the
asset are transferred to another party or (c) despite having
retained some significant risks and rewards of ownership, control
of the asset has been transferred to another party who has the
practical ability to unilaterally sell the asset to an unrelated
third party without imposing additional restrictions.
Financial liabilities
Financial liabilities are classified according to the substance
of the contractual arrangements entered into. Financial liabilities
are initially recognised at fair value plus transactions costs that
are attributable to their acquisition or issue.
The Company's financial liabilities during the period are
comprised of liabilities related to the redeemable Public Shares,
trade and other payables and derivative liabilities related to the
Public and Sponsor Warrants.
Subsequent measurement
The redeemable Public Shares and trade and other payables are
classified as financial liabilities at amortised cost and are
measured at amortised cost using the effective interest rate. The
amortised cost of a financial liability is the amount at which the
financial liability is measured on initial recognition, minus
principal repayments, plus or minus the cumulative amortisation
using the effective interest method of any difference between the
initial amount recognised and the maturity amount. Such
amortisation amounts are recognised in the Statement of
Comprehensive Income. Due to the short term nature of the trade and
other payables, they are stated at their nominal value, which
approximates their fair value.
Public Warrants and Sponsor Warrants are derivative liabilities,
which are classified as financial liabilities at fair value through
profit or loss. Subsequent to initial recognition, the Public and
Sponsor Warrants are measured at fair value and changes thereto are
recognised in the Statement of Comprehensive Income.
Expenses
All expenses are accounted for on an accrual basis and are
presented as expense items, except for expenses that are incidental
to the disposal of an investment which are deducted from the
disposal proceeds, and expenses related to the issue of shares
which are netted against the financial instruments they are
allocated to. For equity instruments, these reduce share capital,
for derivative liabilities these are expensed immediately and for
liabilities these initially reduce the liability and are
subsequently accreted to the Profit and Loss over time.
Prepayments
Prepayments are expenses paid in advance that are amortised on a
straight-line basis over the period to which they are
applicable.
For the period 14 April 2021 to 31 December 2021
2. Principal accounting policies, continued
Equity
Equity is classified according to the substance of the
contractual arrangements entered into. An equity instrument is any
contract that evidences a residual interest in the assets of the
Company after deducting all of its liabilities. Equity is recorded
at the amount of proceeds received, net of issue costs.
Class B ordinary shares ("Sponsor Shares") are classified as
equity in accordance with IAS 32 - "Financial Instruments:
Presentation" as these instruments include no contractual
obligation to deliver cash and the redemption mechanism is not
mandatory.
Class A ordinary shares ("Public Shares") held by the Sponsor
are subject to the Lock-up and Waiver Agreement (see note 12) and
as a result of these restrictions are classified as Equity.
Share issue costs
Share issue cost have been incurred in relation to the issue of
the Sponsor Shares, Public Shares and Warrants. Where shares are
classified as equity, share issue costs are recognised in equity.
Public Shares not subject to the Lock-up and Waiver Agreement (see
note 12) have been classified as liabilities, due to the redemption
facility attached to these Shares. Share issue costs attributed to
these shares are amortised to the Statement of Comprehensive Income
using the effective interest method. For Warrants the share issue
costs are recognised immediately in the Statement of Comprehensive
Income.
Share-based payments (equity-settled)
The grant of the Sponsor Shares is recognised as equity-settled
share-based payments under IFRS 2. Services received in exchange
for the grant of any share-based payments are measured by reference
to the fair value of the instruments at the grant date, which is
determined to be the date of consummation of the Business
Combination. Share-based payments are recognised as an expense in
the Statement of Comprehensive Income.
Tax
The Directors intend that the affairs of the Company will be
managed and conducted so that it does not become resident in the
United Kingdom for UK taxation purposes. Accordingly, and provided
that the Company does not carry on a trade in the United Kingdom
(whether or not through a permanent establishment situated
therein), the Company will not be subject to UK income tax or UK
corporation tax, except on certain types of UK source income and on
any capital gains tax realised on the disposal of any UK land or
the disposal of certain interests in entities which derive,
directly or indirectly, 75% or more of their gross asset value from
UK land.
3. Tax status
The tax legislation of the jurisdiction in which a prospective
investor is resident for tax purposes or otherwise subject to tax
and the tax legislation of Guernsey may have an impact on the
income received from the securities. Prospective investors
considering an investment in the Shares cum Rights, comprising the
Public Shares and Public Warrants, should consult their advisers on
the possible income tax consequences of investing in such
securities under the laws of their country of citizenship,
residence or domicile.
For the period 14 April 2021 to 31 December 2021
4. Use of judgements and estimates
The preparation of Financial Statements in accordance with IFRS
requires the Board to make judgements, estimates and assumptions
that affect the application of policies and the reported amounts of
assets and liabilities and income and expenses. The estimates and
associated assumptions are based on various factors that are
believed to be reasonable under the circumstances, the results of
which form the basis of making the judgements about carrying values
of assets and liabilities that are not readily apparent from other
sources. Actual results may differ from these estimates.
The estimates and underlying assumptions are reviewed on a
semi-annual basis. Revisions to accounting estimates are recognised
in the period in which the estimate is revised if the revision
affects only that period, or in the period of the revision and
future periods if the revision affects both current and future
periods.
The principal judgements and estimates are as follows:
Judgements
Share-based payments
Regarding the Sponsor Shares issued by the Company, the Board
has exercised judgment in determining whether the Sponsor Shares
should be treated as a financial instrument (IAS 32) or share based
payments (IFRS 2).
IFRS 2 applies to any transaction in which an entity receives
goods or services as part of a share based payment arrangement.
Careful consideration of all facts and circumstances, such as
whether the rights of the Sponsor Shareholders differ from those of
the Public Shareholders, is required to determine if IFRS 2
applies. In making this determination, the following factors have
been considered.
-- Should a Business Combination be successfully achieved, a
proportion of the Sponsor Shares will automatically convert into
Public Shares at no further cost to the Sponsor Shareholders. As
the issue price of each Sponsor Share was GBP0.01, this represents
a considerable discount to the price paid by Public
Shareholders;
-- The number of Sponsor Shares that may be converted to Public
Shares may increase further, subject to certain performance-related
conditions subsequent to the Business Combination;
-- Notwithstanding that the Sponsor is providing its services to
the Company in an equivalent capacity to an employment
relationship, the conversion of the Sponsor Shares to Public Shares
is entirely contingent on the successful consummation of a Business
Combination, and no reward will accrue to the Sponsor for its
services in the event that a Business Combination is not
consummated.
Accordingly, the Board has exercised judgement in determining
that the Sponsor Shares fall under the scope of IFRS 2 as
equity-settled share based payments. The fair value at the grant
date of equity-settled share based payments is generally recognised
as an expense with a corresponding increase in equity over the
vesting period.
The deemed grant date of the Public Shares will determine the
point at which the Public Shares will be accounted for under IFRS
2. The Board has determined that the effective grant date for the
Public Shares is the point of consummation of a Business
Combination, and not the original date of issue of the Sponsor
Shares for the following reasons:
-- No contractual obligation on the part of the Company to
deliver cash or any other financial asset to holders of the Sponsor
Shares exists prior to a Business Combination, and the Sponsor
Shareholders are not entitled to any preferential terms over
holders of Public Shares;
-- Should the Sponsor fail to successfully achieve a Business
Combination, then the Sponsor Shares will not be eligible for
conversion to Public Shares and the Sponsor will receive no
material compensation for their work in attempting to identify a
target acquisition;
-- Under the Lock-up and Waiver Agreement, the Sponsor has
agreed to waive its right to any liquidating distributions from the
Escrow Account; and
The Sponsor did not commence any services related to target
screening, searching out, identifying and evaluating potential
Business Combinations for the company until after the admission of
the Public Warrant on 7 January 2022.
For the period 14 April 2021 to 31 December 2021
Use of judgements and estimates, continued
As a result, no expense for such payments will be recognised
until the Business Combination is consummated. At that date (and
potentially certain later dates should certain triggering events
occur) an expense will be recognised in the Statement of
Comprehensive Income on a fair value basis.
Sponsor Warrants
Similarly to Sponsor Shares, the Board has exercised judgement
in determining whether the Sponsor Shares should be treated as a
financial instrument (IAS 32) or share based payments (IFRS 2).
IFRS 2 applies to any transaction in which an entity receives goods
or services as part of a share-based payment arrangement. That
determination requires careful consideration of all the facts and
circumstances, such as whether the rights of the Sponsor Warrant
holders differ from those of the Public Warrant holders. The board
have determined that Sponsor Warrants do not fall within the scope
of IFRS 2 for the following reasons:
-- The Sponsor Warrants were issued at a price of GBP1 per
Warrant and are exercisable at a price of GBP11.50 per Public
Share, which do not represent preferential terms to those afforded
to Public Warrant holders;
-- No further Sponsor Warrants are receivable for zero or discounted consideration;
-- The commercial basis for the issue of Sponsor Warrants is to
provide sufficient capital to cover the Company's listing costs and
operating expenses until the achievement of a Business Combination,
without diluting the value of the Public Shareholders' shares;
-- There are no service conditions attached to the Sponsor Warrants;
-- Sponsor Warrant holders have no different rights from Public
Warrant holders in the event of a successful Business Combination
or the failure to achieve such a combination.
The Board's judgment is that the Sponsor Warrants are a puttable
financial instrument that includes a contractual obligation for the
issuer to redeem that instrument for cash or another financial
asset (in this case, a Public Share) upon exercise. The Sponsor
Warrants do not entitle the holder to a pro rata share of the
entity's assets in the event of the entity's liquidation and are
therefore classified as a financial liability in accordance with
section 16 of IAS 32.
Deferred underwriting fee
Citigroup Global Markets Limited ("the Underwriter" of the
Company's Placing) is potentially entitled to a deferred
underwriting fee. The Board has exercised judgement in determining
that at the year-end no liability in relation to this fee exists as
IAS 32 requires the recognition of the worst-case liability which
would be to repay the funds raised to shareholders if no business
combination is completed. This underwriting fee is only payable on
the completion of a Business Combination and will be paid from the
funds held in the Escrow account.
Estimates
Fair value of derivative financial instruments at fair value
through profit or loss
The Company recognises its investment in derivative instruments
(Public Warrants and Sponsor Warrants) initially at fair value at
date of issuance with any subsequent movement in fair value between
the issuance date and the year-end being recognised as a fair value
movement through profit and loss. A third party valued the Warrants
using an appropriate valuation model and determined the fair value
at the date of issuance to be GBP0.73 per warrant and the fair
value at year-end date to be GBP0.57 per warrant. Judgements were
required for the inputs into the valuation model specifically
volatility rates of suitable comparable companies and estimated
life of the warrants (see note 2 for details).
For the period 14 April 2021 to 31 December 2021
5. Financial risk management
Financial risk factors
The Company is exposed to market risk, credit risk and liquidity
risk. The risk management policies employed by the Company to
manage these risks are discussed below:
(a) Market risk
Market risk is the risk that changes in market factors such as
foreign exchange rates, interest rates and equity prices will
affect the Company's income and/or the value of its holdings in
financial instruments.
Foreign currency risk
Currency risk is the risk that the fair value or future cash
flows of a financial instrument will fluctuate because of changes
in foreign exchange rates. During the period ended 31 December
2021, the Company had no financial instrument denominated in a
currency other than its operational and reporting currency, and
therefore was not exposed to foreign currency risk.
Interest rate risk
Interest rate risk is the risk that the fair value or future
cash flows of a financial instrument will fluctuate because of
changes in market interest rates. The Company's cash and cash
equivalents are non-interest-bearing, however the restricted cash
balance consists of amounts held in an Escrow account which accrue
interest at a variable rate and therefore exposed to interest rate
risk.
As at 31 December 2021, if interest rates had been 0.5%
higher/lower, with all other variables held constant, the Company's
bank interest received for the period would have been GBP61,540
higher or lower.
Price risk
Price risk is the risk that changes in market prices will affect
the value of the Company's financial assets or liabilities at fair
value through profit or loss. The Company is exposed to price risk
in respect of its Public Warrants and Sponsor Warrants, which are
measured at fair value using an appropriate valuation model.
As at 31 December 2021, the Public Warrants had not yet been
admitted to trading, and the valuation attributed to them has been
used solely to determine the portion of the GBP10 issue price of
the Public Shares cum rights to be allocated to the Public
Warrants.
The fair value of the Sponsor Warrants has similarly been used
to determine the portion of the GBP1 issue price of the Sponsor
Warrants to be classified as a financial liability, the remainder
of the issue price being allocated to Other reserves as a capital
contribution from the Sponsor, which is classified as equity.
Accordingly, as at 31 December 2021, the price of the Public and
Sponsor Warrants has no impact on the Company's total comprehensive
income for the period.
(b) Credit risk
Credit risk is the risk that a counterparty to a financial
instrument will fail to discharge an obligation or commitment that
it has entered into with the Company, resulting in a financial loss
to the Company. The Company is exposed to credit risk arising from
its restricted cash, cash and cash equivalents and other
receivables.
The maximum credit risk exposure in relation to the Company's
cash balances is best represented by the carrying value of the cash
and cash equivalents, amounts held in escrow balances and other
receivables in the Statement of Financial Position.
The Company seeks to mitigate the credit risk attached to its
cash and cash equivalents and amounts held in escrow by placing all
cash with reputable banking institutions with a credit rating of A
(or equivalent) or higher as determined by an internationally
recognised rating agency.
Cash and cash equivalents are held with Royal Bank of Scotland
International ("RBSI"), which has a Fitch long term credit rating
of A, a Moody's long-term credit rating of A3 and an S&P
long-term credit rating of A-.
Amounts held in escrow are held with Citibank, N.A. which has a
Fitch long term credit rating of AA-, a Moody's long-term credit
rating of Aa3 and an S&P long-term credit rating of A+.
For the period 14 April 2021 to 31 December 2021
Financial risk management, continued
(c) Liquidity risk
Liquidity risk is the risk that an entity will encounter
difficulty in meeting obligations associated with its financial
liabilities. The table below analyses how quickly the Company's
assets can be liquidated to meet the obligation of maturing
liabilities.
Maturity Analysis
As at 31 December 2021 Less than 1 month >12 months Total
Assets GBP GBP GBP
Restricted cash - 150,146,837 150,146,837
Cash and cash equivalents 1,657,916 - 1,657,916
Other receivables 1,000,000 - 1,000,000
2,657,916 150,146,837 152,804,753
----------------------- ----------------- -----------------
Liabilities
----------------------- ----------------- -----------------
Public share liabilities - 138,139,433 138,139,433
Derivative liabilities - 7,888,266 7,888,266
Other payables - 425,154 425,154
----------------------- ----------------- -----------------
- 146,452,853 146,452,853
----------------------- ----------------- -----------------
( c) Capital risk management
The capital structure of the Company consists of equity
attributable to holders of Sponsor Shares and non-redeemable Public
Shares, redeemable Public Shares issued (see note 7) and retained
earnings.
6. Cash and cash equivalents
31 December 2021
GBP
Restricted cash 150,146,837
Cash and cash equivalents 1,657,916
Total 151,804,753
----------------
Pursuant to the terms of the Escrow Agreement and in accordance
with the requirements set out in Listing Rule 5.6.18A(2), the
Company may only direct the release of cash held in escrow
("restricted cash") upon the occurrence of a payment event, being
any of:
-- redemption by any holder of Public Shares in connection with
the completion of a Business Combination (which has been approved
by the Board and the Required Majority at the Business Combination
General Meeting, in each case in accordance with the requirements
of the Articles of Incorporation);
-- the passing of the Business Combination Deadline without the
Company completing a Business Combination;
-- approval by the Board of the Business Combination, and the
Required Majority adopting a resolution to approve the Business
Combination prior to the Business Combination Deadline, in each
case in accordance with the requirements of the Articles of
Incorporation;
-- the winding-up or liquidation of the Company; or
-- income tax on interest earned (if any) on the funds in escrow
becoming payable by the Company.
The Escrow Agent shall also be permitted to release funds in the
Escrow Account in accordance with the terms of a Judgment
determining entitlement of the Company or any other person to the
funds or any portion thereof, provided that, at the Escrow Agent's
sole discretion, such Judgment shall be accompanied by a legal
opinion confirming the effect of such Judgement, that it represents
a final adjudication of the rights of the parties and that the time
for appeal from such Judgment has expired without an appeal being
made.
For the period 14 April 2021 to 31 December 2021
7. Issued share capital
Shares 31 December 2021
No. of shares GBP
Redeemable Class A ordinary shares of no par value
("Public Shares") 14,647,985 146,479,850
Non-redeemable Class A ordinary shares of no par value
("Public Shares") 366,200 3,662,000
Class B ordinary shares of no par value ("Sponsor Shares") 3,661,996 36,620
18,676,181 150,178,470
------------- -----------
Class A ordinary shares ("Public Shares")
Further to publication of its prospectus on 25 November 2021,
the Company completed the placing of 14,350,000 units of the
Company at a price of GBP10 per unit, each unit comprising one
Public Share in the Company and the right to receive one half of
one warrant in respect of Public Shares ("Public Warrant"). 350,000
of these Public Shares were issued to the Sponsor via the Company's
Overfunding Subscription.
On 30 November 2021, the Company announced the admission of
14,350,000 Public Shares to trading on the London Stock Exchange's
main market for listed securities ("LSE").
On 3 December 2021, the Company announced that Citigroup Global
Markets Limited, acting as Stabilisation Manager, had partially
exercised the Over-allotment Option granted by the Company in
respect of 647,985 units, at a price of GBP10 per unit.
Accordingly, 647,985 Public Shares were admitted to trading on LSE
on 7 December 2021. The Over-allotment Option was granted to the
Stabilisation Manager to enable the Stabilisation Manager to
require the Company to issue up to 1,000,000 Option Units, each
option Unit comprising one Public Share in the Company and the
right to receive one half of one Public Warrant.
In addition, and as disclosed in the Prospectus, HPAC Sponsor
LLP (the "Sponsor") subscribed for a further 16,200 units via the
Overfunding Subscription. Accordingly, a further 16,200 Public
Shares were admitted to trading on LSE on 10 December 2021.
As at 31 December 2021, the total number of Public Shares
admitted to trading is 15,014,185, of which 366,200 Shares were
issued to the Sponsor via the Overfunding Subscription and the
Over-allotment Option. These latter shares are subject to the
Lock-up and Waiver Agreement (see note 12), which, inter alia,
removes the right of redemption attached to these Public Shares,
which are accordingly classified as equity. These 366,200 shares
alongside the 3,661,996 Class B ordinary shares make up share
capital net of share issuance costs of GBP93,856.
Holders of the remaining 14,647,985 Public Shares are entitled
to redeem all or a portion of their Public Shares upon the
completion of the business combination. Accordingly, these Public
Shares are classified as liabilities in the Company's Statement of
Financial Position and are measured at amortised cost.
Public Shares carry the right to receive dividends and other
distributions declared on them, and holders of Public Shares are
entitled to one vote per share at a general shareholders' meeting
of the Company, including a vote on the proposed business
combination.
Public Shares 31 December 2021
GBP
Proceeds of issue of Public Shares 146,479,850
Less: initial recognition of Public Warrants (5,480,174)
Less: share issue costs (3,577,995)
Effective interest accretion 717,752
138,139,433
--------------------------------------------- ----------------
For the period 14 April 2021 to 31 December 2021
7. Issued share capital, continued
Class B ordinary shares ("Sponsor Shares")
During the period, the Sponsor and the Directors have subscribed
to a total of 3,661,996 Sponsor Shares at a price of GBP0.01 per
share.
As at 31 December 2021, the total number of Sponsor Shares in
issue is 3,661,996.
Upon completion of the Business Combination, the Sponsor Shares
will convert on the trading day following the consummation of the
Business Combination into such number of Public Shares that the
number of Public Shares issuable to the Sponsor upon conversion of
all Sponsor Shares will be equal, on an as-converted basis, to 8%
of the total number of Ordinary Shares issued and outstanding as a
result of the completion of the Placing (including the Public
Shares issued pursuant to the Over-allotment Option). In addition,
each Sponsor Share will be converted into Public Shares (in two
further tranches equal to 6% of the total number of Ordinary Shares
issued and outstanding) after the Business Combination subject to
certain performance-related conditions.
Subject to the variation of certain voting rights and powers in
respect of the Business Combination, Sponsor Shares carry the same
shareholder rights as Public Shares. However, the Company's Sponsor
and Directors have entered into a Lock-up and Waiver Agreement with
the Company (see note 12), under which they have agreed to waive
their redemption rights in respect of the Sponsor Shares or any
Public Shares acquired as a result of conversion in connection with
the Business Combination. Accordingly, the Sponsor Shares are
classified as equity in the Company's Statement of Financial
Position.
8. Warrants
Public Warrants
Subsequent to the period end, on 7 January 2022, 7,507,088
Public Warrants, the right to which was included in the issue of
units in the Company during the period (see note 7), were admitted
to trading on LSE.
Each Public Warrant gives the holder the right to subscribe for
one Public Share at a price of GBP11.50 following the completion of
the Business Combination.
Accordingly, the Public Warrants are classified as derivative
liabilities and initially will be recognised at their fair value of
GBP0.73 per warrant at the issuance date of 25 November 2021.
Between issuance date and year end a fair value movement of
GBP1,201,134 has been recognised through profit and loss.
As at 31 December 2021, the Public Warrants have been valued
using an appropriate valuation model at GBP0.57 per Warrant and are
recognised in these Financial Statements at a total value of
GBP4,279,040.
Sponsor Warrants
During the period, the Sponsor and the Directors have subscribed
to a total of 6,331,977 Sponsor Warrants at a price of GBP1 per
warrant. Of the GBP6,331,977 raised from the issue of the Sponsor
Warrants, a derivative liability was recognised at the fair value
of GBP0.73 per warrant at the issuance date of 25 November 2021.
The remainder has been allocated to Other Reserves as a capital
contribution to the company. Subsequently, at 31 December 2021, the
Sponsor Warrants have been valued at GBP0.57 per warrant and are
recognised in these Financial Statements at a total value of
GBP3,609,226. The movement in fair value of GBP1,013,116 between
date of issuance and year end has been recognised as a fair value
movement through profit and loss. Each Sponsor Warrant gives the
holder the right to subscribe for one Public Share at a price of
GBP11.50 following the completion of the Business Combination.
9. Other receivables
Other receivables comprises an amount of GBP1,000,000 due from
Hambro Perks Limited, which was settled on 11 March 2022.
For the period 14 April 2021 to 31 December 2021
10. Earnings per share
The calculation of basic and diluted earnings per share has been
based on the following profit attributable to shareholders and
weighted-average number of ordinary shares outstanding at the year
end.
For the period ended 31 December 2021 Basic Diluted
GBP GBP
Profit for the period GBP1,080,886 GBP1,080,886
------------ ------------
Weighted average number of shares 531,950 531,950
------------ ------------
Earnings per share GBP2.03 GBP2.03
------------ ------------
The weighted -average number of ordinary shares is determined by
reference to the 3,661,996 Class B Ordinary shares and 366,200
Public shares issued to the Sponsor and subject to the Lock-up and
Waiver Agreement. Public and Sponsor Warrants are deemed to be
anti-dilutive as the average market price of ordinary shares during
the period did not exceed the GBP11.50 exercise price of the
Warrants and they are therefore out of the money and excluded from
the diluted earnings per share calculation. The 14,647,985
redeemable Public Shares under IAS 33 are deemed to be contingently
issuable shares issuable only upon a Business Combination so under
IAS 33.24 will be excluded from the earnings per share calculations
until the Business Combination has occurred.
11. Auditor's remuneration
Grant Thornton UK LLP ("GT") was appointed as independent
auditor on 24 November 2021. The remuneration to Grant Thornton UK
LLP and to other Grant Thornton member firms for audit of the
Company's annual financial statements amounts to GBP97,850. As at
31 December 2021, GBP97,850 was unpaid.
The Audit Committee noted that non-audit services had been
provided to the Company by the Auditor in the form of services as
Reporting Accountant, in respect of which the Auditor had been paid
a fee of GBP134,930, which posed a potential threat to the
Auditor's independence.
To fulfil its responsibility regarding the independence of the
Auditor, the Audit Committee considered a report from the Auditor
describing its arrangements to identify, report and manage any
conflicts of interest.
The Audit Committee was satisfied, given that the work of the
Reporting Accountant took place before its appointment as Auditor,
that such work was a non-recurring service, and that no work
performed in its role as Reporting Accountant would be used for the
audit, that appropriate safeguards are in place to ensure that
there is no impairment to the Auditor's objectivity and
independence.
12. Related party transactions
From 14 April 2021 (being the Company's date of incorporation)
to date, the Company has entered into the following related party
transactions:
a) the letters of appointment with each of the Directors (for further detail see note 13);
b) the acquisition of 3,661,996 Sponsor Shares by the Sponsor and the Directors (note 7);
c) the acquisition of 6,331,977 Sponsor Warrants by the Sponsor
and the Directors at a price of GBP1 per Sponsor Warrant, the
proceeds of which were used to finance the placing and listing
expenses and the operating expenses of the Company prior to the
completion of the Business Combination (note 8);
d) the Lock-up and Waiver Agreement, under which the Sponsor and
the Directors have agreed to waive their redemption rights in
respect of their holding of Public or Sponsor Shares, and
undertaken not to participate in the shareholder vote on the
proposed Business Combination;
e) the M&A Advisory Agreement (for further detail see note 13); and
For the period 14 April 2021 to 31 December 2021
Related party transactions, continued
f) the acquisition of 366,200 Public Shares cum rights by the
Sponsor at a price of GBP10 per Share under the Overfunding
Subscription (note 7).
The Over-allotment Option is an option granted to the
Stabilisation Manager by the Company, exercisable in full or in
part during the period commencing on the date of the commencement
of conditional dealings in the Public Shares on the London Stock
Exchange and ending no later than 30 calendar days thereafter,
pursuant to which the Stabilisation Manager may require the Company
to issue at the fixed Placing Price of GBP10 up to 1,000,000 Option
Units, comprising up to 7.1% of the aggregate number of Shares cum
Rights sold in the Placing (excluding the Option Units), solely for
the purpose of covering over-allotments and short positions, if
any, in connection with the Placing or to facilitate stabilisation
transactions, if any, with a view to supporting the market price of
the Public Shares at a higher level than that which might otherwise
prevail in the open market.
The over-allotment shares were issued to the Sponsor and were
subsequently repurchased by the Company. These shares were held in
treasury and loaned to the Stabilisation Manager under the Stock
Loan Agreement. On exercise of the Over-allotment option, the
Company was obliged to issue up to 1,000,000 Shares cum Rights in
order to satisfy its obligations under the Option. Any unissued
Shares cum Rights were required to be returned to the Company
pursuant to the Stock Loan Agreement for cancellation upon expiry
of the Option. The Over-allotment Option expired on 24 December
2021, and accordingly no further Shares may be issued
thereunder.
During the period, the Directors received the following
remuneration in the form of Directors' fees:
For the period
from
14 April 2021
to
31 December 2021
GBP
Sir Anthony Salz 4,164
Dominic Perks 4,164
Dominic Shorthouse 4,164
Matthew Wood 4,164
Dr Sarah Wood 3,508
------------------
20,164
------------------
13. Material agreements
Administration Agreement
Sanne Fund Services (Guernsey) Limited (the "Administrator") was
appointed pursuant to the terms of the Administration and
Secretarial Support Services Agreement dated 25 November 2021 (the
"Administration Agreement").
Under the terms of the Administration Agreement, the
Administrator is entitled to receive:
-- Various launch fees including an establishment fee (nominal
fixed fee of GBP2,000), a listing fee (fixed fee of GBP6,500) and a
financial position and prospects procedures memorandum fee (fixed
fee of GBP11,000), plus additional charges for certain duties
undertaken from time to time.
-- A fixed administration fee of GBP30,000 per annum until a target acquisition is identified.
-- An abort fee capped at GBP20,000 in the event the project aborts at any time.
The Administration fees for the period totalled GBP3,041, of
which GBP3,041 was outstanding at the period end.
Total launch fees for the period totalled GBP20,550, of which
GBP20,550 was outstanding at the period end.
The Administration Agreement can be terminated by either party
giving to the other not less than 90 calendar days' notice in
writing (or such shorter notice as the parties may agree). On 31
December 2021, the Company gave written notice to the Administrator
of its intention to terminate the agreement. It was agreed that
termination would be effective as of 30 April 2022.
For the period 14 April 2021 to 31 December 2021
13. Material agreements, continued
M&A Advisory Agreement
Hambro Perks Advisory LLP (the "Adviser") was appointed pursuant
to the terms of the M&A Advisory Agreement dated 24 November
2021.
Under the terms of the M&A Advisory Agreement, the Advisor
is entitled to receive a monthly fee of GBP10,000 commencing on the
date of the M&A Advisory Agreement and ending on the earlier of
the date of (i) completion of the Business Combination and (ii) the
Business Combination deadline. The M&A Advisory Agreement may
also be terminated by notice in writing by a party subject to
certain events occurring.
During the period ended 31 December 2021, an amount of GBP12,000
was payable to the Advisor, of which GBP12,000 was outstanding at
the period end.
Hambro Perks Limited
As at 31 December 2021, an amount of GBP1,000,000 was due to the
Company by Hambro Perks Limited, the controlling party of the
Sponsor and the Advisor. This amount was settled on 11 March
2022.
Directors' letters of appointment
The Company has no employees. The Directors are the only key
management personnel of the Company. Each Director was appointed
pursuant to a letter of appointment between the respective Director
and the Company dated on each Directors respective appointment
date.
Under the terms of the letters of appointment the Company's
Directors each receive an annual fee of GBP40,000 per annum and
will be reimbursed for any out-of-pocket expenses incurred in
connection with activities on the Company's behalf, such as
identifying potential Target Businesses and performing due
diligence on suitable business combinations.
During the period ended 31 December 2021, the Directors fees
amounted to GBP20,164, of which GBP20,164 was outstanding at the
period end.
Escrow Agreement
Citibank, N.A., London Branch (the "Escrow Agent") was appointed
pursuant to the terms of the Escrow Agreement (the "Escrow
Agreement"), dated 24 November 2021.
14. Contingencies and commitments
The Underwriter of the Company's Placing is potentially entitled
to a deferred underwriting fee payable from the Escrow account upon
the successful completion of a Business Combination.
15. Subsequent events
-- On 7 January 2022, the Company announced the admission of
7,507,088 Public Warrants to the standard listing segment of the
Official List of the Financial Conduct Authority and to trading on
the LSE. At this date, the warrants move from level 3 to a level 1
with a quoted price of GBP0.35 per Warrant giving a post year-end
revaluation gain of GBP1,651,559.
There were no other significant post year end events that
require disclosure or adjustment in these Financial Statements.
OFFICERS AND ADVISERS
Directors: Sir Anthony Salz (Chairman) (appointed 9 November 2021)
Dominic Perks (Executive Director) (appointed 8 June 2021)
Dominic Shorthouse (Executive Director) (appointed 9 November
2021)
Matthew Wood (Independent Non-Executive Director) (appointed 8
June 2021)
Sarah Wood (Independent Non-Executive Director) (appointed 30
November 2021)
David Piesing (Independent Non-Executive Director) (appointed 14
April 2021, resigned 8 June 2021)
Peter Soliman (Executive Director) (appointed 14 April 2021,
resigned 8 June 2021)
Registered Office: PO Box 286
Floor 2, Trafalgar Court
Les Banques, St Peter Port
Guernsey GY1 4LY
Sponsor: HPAC Sponsor LLP
111 Buckingham Palace Road
London, SW1W 0SR
Adviser: Hambro Perks Advisory LLP
111 Buckingham Palace Road
London, SW1W 0SR
Company Secretary: Peter Soliman
Sole Global Coordinator
and Citigroup Global Markets Limited
Bookrunner: Citigroup Centre
Canada Square
Canary Wharf
London, E14 5LB
Registrar: Computershare Investor Services (Guernsey) Limited
1st Floor Tudor House
Le Bordage, St Peter Port
Guernsey, GY1 1DB
Independent Auditor: Grant Thornton UK LLP
30 Finsbury Square
London, EC2A 1AG
Legal adviser to the
Company White & Case LLP
as to US and English law: 5 Old Broad Street
London, EC2N 1DW
Legal adviser to the
Company C arey Olsen (Guernsey) LLP
as to Guernsey law: Carey House
Les Banques
St Peter Port
Guernsey, GY1 4BZ
Legal adviser to the Clifford Chance LLP
Bookrunner as to US and 10 Upper Bank Street
English law : London, E14 5JJ
Company Number: 69093 (Registered in Guernsey)
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END
FR FPMBTMTITTBT
(END) Dow Jones Newswires
June 29, 2022 02:00 ET (06:00 GMT)
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