NRR Newriver Reit Plc

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

THIS IS AN ANNOUNCEMENT FALLING UNDER RULE 2.4 OF THE CITY CODE ON TAKEOVERS AND MERGERS (THE "CODE"). IT DOES NOT REPRESENT A FIRM INTENTION TO MAKE AN OFFER UNDER RULE 2.7 OF THE CODE. ACCORDINGLY, THERE CAN BE NO CERTAINTY THAT ANY FIRM OFFER WILL BE MADE.

THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION.

FOR IMMEDIATE RELEASE

23 May 2024

NewRiver REIT plc

("NewRiver" or the "Company")

Possible Offer for Capital & Regional plc ("Capital & Regional")

The Board of NewRiver notes the recent announcement by Capital & Regional and confirms that it has made a proposal to Growthpoint Properties Limited ("Growthpoint") which holds 68.1% of the issued share capital of Capital & Regional in regard to a possible offer in cash and shares for the entire issued, and to be issued, share capital of Capital & Regional (the "Possible Offer"). NewRiver also confirms that it has not communicated that proposal to Capital & Regional. It is intended that this would occur if Growthpoint confirms that it would be prepared to support the terms of that Possible Offer. The Board of NewRiver of course recognises that the Board of Capital & Regional must make its own fair and reasonable assessment of the Possible Offer in the event that NewRiver makes the proposal to Capital & Regional.

The Board of NewRiver believes that a combination with Capital & Regional, on the terms of the Possible Offer proposed to Growthpoint, would be significantly accretive to NewRiver's earnings and result in a pro-forma Loan to Value ("LTV") ratio that is broadly in-line with NewRiver's guidance.

There can be no certainty that any offer will be made, nor as to the terms of any such offer.

The Board of NewRiver has given significant consideration to the ways in which a combination of NewRiver and Capital & Regional could generate value for our respective shareholders. NewRiver's Board believes that, provided sensible terms for a transaction can be agreed, the acquisition of Capital & Regional would significantly accelerate NewRiver's growth ambitions, whilst delivering significant value for both Capital & Regional and NewRiver shareholders and also maintaining NewRiver's core operational expertise in retail real estate.

The Board of NewRiver believes that a combination of Capital & Regional and NewRiver (the "Combined Group") represents a highly attractive proposition for all shareholders on account of:

·      Capital & Regional's high quality and complementary portfolio: Capital & Regional's portfolio comprises six community shopping centres predominantly located in London and South East England, let to essential and value-oriented retailers that would be highly complementary to NewRiver's existing portfolio. NewRiver knows these assets well and believes that the disposal of non-core assets in recent years and the acquisition of The Gyle in Edinburgh in September 2023 have led to an improvement in the quality and complementary nature of Capital & Regional's remaining portfolio. Against this real estate background, the Board believes that the financially accretive aspects of the combined business strategy can be readily achieved;

·      Combination expected to unlock substantial cost synergies and deliver significant earnings accretion: NewRiver sees, inter alia, the opportunity to unlock substantial cost synergies, including the elimination of duplicative operational and public listing costs. NewRiver also anticipates income growth opportunities through active asset management. NewRiver expects the combination with Capital & Regional to deliver significant earnings accretion, enabling the Combined Group to pay a materially higher, covered dividend;

·      Well-diversified portfolio with enhanced scale: the Combined Group would have a retail focused portfolio with a comparable yield profile, valued at c.£920 million (comprising 42 assets), and assets under management of c.£1.7 billion (comprising 63 assets) based upon the last reported figures for both companies. The combined portfolio would continue to benefit from a well-diversified and complementary tenant base with low levels of tenant concentration; and

·      Increased trading liquidity: As a result of its enhanced scale, it is expected the Combined Group would benefit from increased share trading liquidity, enlarged index weightings, enhanced debt optionality and potential cost of capital improvements.

Any firm intention to make an offer under Rule 2.7 of The City Code on Takeovers and Mergers (the "Code"), would be contingent on securing the support of Growthpoint and the satisfaction or waiver of certain customary conditions, including completion of due diligence to the satisfaction of NewRiver. The Board of NewRiver further confirms that in formulating a Possible Offer, it would act with the necessary prudence to maintain NewRiver's balance sheet strength. As stated above, the Board of NewRiver anticipates that NewRiver's pro-forma LTV implied by a Possible Offer would remain broadly in-line with previous guidance.

As required by Rule 2.6(a) of the Code, NewRiver is required, by not later than 5.00 p.m. on 20 June 2024, either to announce a firm intention to make an offer for the Company in accordance with Rule 2.7 of the Code or to announce that it does not intend to make an offer, in which case the announcement will be treated as a statement to which Rule 2.8 of the Code applies. This deadline may be extended with the consent of the Panel on Takeovers and Mergers ("Takeover Panel") in accordance with Rule 2.6(c) of the Code. For the purposes of Rule 2.5(a) of the Code, NewRiver reserves the right to vary the form and mix of the consideration and/or to introduce other forms of consideration.

A further announcement will be made if and when appropriate. There can be no certainty any offer will be made, even if the pre-conditions are satisfied or waived, nor as to the terms of any offer.

This announcement is being made without the consent of Capital & Regional or Growthpoint.

For further information

The information contained within this announcement is deemed by the Company to constitute inside information as stipulated under the Market Abuse Regulation (EU) No. 596/2014 as it forms part of the law of England and Wales by virtue of the European Union (Withdrawal) Act 2018. This announcement has been authorised for release by the Board of Directors of NewRiver.

Important Notices

This announcement does not constitute a prospectus or prospectus equivalent document. This announcement is not intended to, and does not, constitute or form part of any offer, invitation or the solicitation of an offer to purchase, otherwise acquire, subscribe for, sell or otherwise dispose of any securities, or the solicitation of any vote or approval in any jurisdiction, pursuant to this announcement or otherwise. Any offer, if made, will be made solely by certain offer documentation which will contain the full terms and conditions of any offer, including details of how it may be accepted or a vote submitted in favour of it.

The release, publication or distribution of this announcement in jurisdictions other than the United Kingdom may be affected by the laws of relevant jurisdictions. Therefore, any person who is subject to the laws of any jurisdiction other than the United Kingdom will need to inform themselves about, and observe, any applicable requirements. Any failure to comply with such requirements may constitute a violation of the securities laws or regulations of the relevant jurisdictions.

Notices Related to Financial Advisers

Jefferies International Limited ("Jefferies"), which is authorised and regulated in the United Kingdom by the Financial Conduct Authority, is acting exclusively for NewRiver and no one else in connection with the Possible Offer and shall not be responsible to anyone other than NewRiver for providing the protections afforded to clients of Jefferies, nor for providing advice in connection with the Possible Offer or any matter referred to herein. Neither Jefferies nor any of its affiliates (nor any of its or their respective directors, officers, employees, representatives or agents) owes or accepts any duty, liability or responsibility whatsoever (whether direct, indirect, consequential, whether in contract, in tort, under statute or otherwise) to any person who is not a client of Jefferies in connection with the Possible Offer, this announcement, any statement contained herein or otherwise.

Kinmont Limited ("Kinmont"), which is authorised and regulated in the United Kingdom by the Financial Conduct Authority, is acting exclusively for NewRiver and no one else in connection with the Possible Offer and shall not be responsible to anyone other than NewRiver for providing the protections afforded to clients of Kinmont, nor for providing advice in connection with the Possible Offer or any matter referred to herein. Neither Kinmont nor any of its affiliates (nor any of its or their respective directors, officers, employees, representatives or agents) owes or accepts any duty, liability or responsibility whatsoever (whether direct, indirect, consequential, whether in contract, in tort, under statute or otherwise) to any person who is not a client of Kinmont in connection with the Possible Offer, this announcement, any statement contained herein or otherwise.

Liberum Capital Limited ("Liberum"), which is authorised and regulated in the United Kingdom by the FCA, is acting exclusively for NewRiver and no one else in connection with the matters described in this announcement. Liberum will not regard any other person (whether or not a recipient of this announcement) as its client in relation to the matters described in this announcement and will not be responsible to anyone other than NewRiver for providing the protections afforded to its clients or for providing any advice in relation to matters or arrangements referred to herein. Neither Liberum nor any of its affiliates (nor any of its or their respective directors, officers, employees, representatives or agents) owes or accepts any duty, liability or responsibility whatsoever (whether direct, indirect, consequential, whether in contract, in tort, under statute or otherwise) to any person who is not a client of Liberum in connection with the Possible Offer, this announcement, any statement contained herein or otherwise.

Shore Capital Stockbrokers Limited ("Shore Capital"), which is authorised and regulated in the United Kingdom by the Financial Conduct Authority, is acting exclusively for NewRiver and no one else in connection with the Possible Offer and shall not be responsible to anyone other than NewRiver for providing the protections afforded to clients of Shore Capital, nor for providing advice in connection with the Possible Offer or any matter referred to herein. Neither Shore Capital nor any of its affiliates (nor any of its or their respective directors, officers, employees, representatives or agents) owes or accepts any duty, liability or responsibility whatsoever (whether direct, indirect, consequential, whether in contract, in tort, under statute or otherwise) to any person who is not a client of Shore Capital in connection with the Possible Offer, this announcement, any statement contained herein or otherwise.

Disclosure Requirements of the Code

Under Rule 8.3(a) of the Code, any person who is interested in 1% or more of any class of relevant securities of an offeree company or of any securities exchange offeror (being any offeror other than an offeror in respect of which it has been announced that its offer is, or is likely to be, solely in cash) must make an Opening Position Disclosure following the commencement of the offer period and, if later, following the announcement in which any securities exchange offeror is first identified. An Opening Position Disclosure must contain details of the person's interests and short positions in, and rights to subscribe for, any relevant securities of each of (i) the offeree company and (ii) any securities exchange offeror(s). An Opening Position Disclosure by a person to whom Rule 8.3(a) applies must be made by no later than 3.30 pm (London time) on the 10th business day following the commencement of the offer period and, if appropriate, by no later than 3.30 pm (London time) on the 10th business day following the announcement in which any securities exchange offeror is first identified. Relevant persons who deal in the relevant securities of the offeree company or of a securities exchange offeror prior to the deadline for making an Opening Position Disclosure must instead make a Dealing Disclosure.

Under Rule 8.3(b) of the Code, any person who is, or becomes, interested in 1% or more of any class of relevant securities of the offeree company or of any securities exchange offeror must make a Dealing Disclosure if the person deals in any relevant securities of the offeree company or of any securities exchange offeror. A Dealing Disclosure must contain details of the dealing concerned and of the person's interests and short positions in, and rights to subscribe for, any relevant securities of each of (i) the offeree company and (ii) any securities exchange offeror(s), save to the extent that these details have previously been disclosed under Rule 8. A Dealing Disclosure by a person to whom Rule 8.3(b) applies must be made by no later than 3.30 pm (London time) on the business day following the date of the relevant dealing.

If two or more persons act together pursuant to an agreement or understanding, whether formal or informal, to acquire or control an interest in relevant securities of an offeree company or a securities exchange offeror, they will be deemed to be a single person for the purpose of Rule 8.3.

Opening Position Disclosures must also be made by the offeree company and by any offeror and Dealing Disclosures must also be made by the offeree company, by any offeror and by any persons acting in concert with any of them (see Rules 8.1, 8.2 and 8.4).

Details of the offeree and offeror companies in respect of whose relevant securities Opening Position Disclosures and Dealing Disclosures must be made can be found in the Disclosure Table on the Takeover Panel's website at www.thetakeoverpanel.org.uk, including details of the number of relevant securities in issue, when the offer period commenced and when any offeror was first identified. You should contact the Panel's Market Surveillance Unit on +44 (0)20 7638 0129 if you are in any doubt as to whether you are required to make an Opening Position Disclosure or a Dealing Disclosure.

Rule 26.1 Disclosure

In accordance with Rule 26.1 of the Code, a copy of this announcement will be available at www.nrr.co.uk by no later than 12 noon (London time) on 24 May 2024.

For the avoidance of doubt, the content of the website referred to in this announcement is not incorporated into and does not form part of this announcement.

No profit forecasts, profit estimates or quantified financial benefits statements

Nothing in this announcement (including any statement of estimated synergies) is intended as a profit forecast, profit estimate or quantified financial benefit statement for any period and no statement in this announcement should be interpreted to mean that earnings or earnings per share or dividend per share for NewRiver or Capital & Regional, as appropriate, for the current or future financial years would necessarily match or exceed the historical published earnings or earnings per share or dividend per share for NewRiver or Capital & Regional, as appropriate.

Forward-looking statements

This announcement and certain oral statements made regarding the Possible Offer and other information published by NewRiver containing statements about NewRiver, Capital & Regional and/or the Combined Group are or may be deemed to be forward-looking statements. All statements other than statements of historical facts included in this announcement, may be forward-looking statements. Without limitation, any statements preceded or followed by or that include the words "targets", "plans", "believes", "expects", "aims", "intends", "hopes", "continues", "would", "could", "should", "will", "may", "anticipates", "estimates", "projects" or words or terms of similar substance or the negative thereof, are forward-looking statements. Forward-looking statements include statements relating to the following: (i) future capital expenditures, expenses, revenues, earnings, synergies, economic performance, indebtedness, financial condition, dividend policy, losses and future prospects; and (ii) business and management strategies and the expansion and growth of NewRiver, Capital & Regional or the Combined Group's operations and potential cost and operating synergies resulting from the Possible Offer. These forward-looking statements are not based on historical fact and are not guarantees of future performance. By their nature, such forward-looking statements involve known and unknown risks and uncertainties that could significantly affect expected results and are based on certain key assumptions. Many factors could cause actual results to differ materially from those projected or implied in any forward-looking statements. Many of these risks and uncertainties relate to factors that are beyond the entities' ability to control or estimate precisely. These factors include, but are not limited to, changes in political and economic conditions, changes in levels of capital investment, success of business and operating initiatives, the impact of any acquisitions or similar transactions, changes in tenants' strategies and stability, changes in the regulatory environment and fluctuations of rates, and changes in tax rates. They have not been reviewed by the auditors of NewRiver or Capital & Regional. Neither NewRiver, nor any of its affiliates or directors, officers, employees or advisers, provides any representation, assurance or guarantee that the occurrence of the events expressed or implied in any forward-looking statements in this announcement will actually occur. Neither NewRiver, nor any of its affiliates or directors, officers, employees or advisers assumes any obligation to update or correct the information contained in this announcement except as required by applicable law. Due to such uncertainties and risks, readers are cautioned not to place undue reliance on such forward-looking statements, which speak only as of the date of this announcement. NewRiver disclaims any obligation to correct or update any forward-looking or other statements contained in this announcement, except as required by applicable law or by the rules of any competent regulatory authority, whether as a result of new information, future events or otherwise.

Rule 2.4 Information

In accordance with Rule 2.4(c)(iii) of the Code, NewRiver confirms that it is not aware of any dealings in Capital & Regional shares that would require it to offer a minimum level, or a particular form, of consideration under Rule 6 or Rule 11 of the Code. However, it has not been practicable for NewRiver to make enquiries of all persons acting in concert with it prior to the date of this announcement in order to confirm whether any details are required to be disclosed under Rule 2.4(c)(iii) of the Code. To the extent that any such details are identified following such enquiries, NewRiver will make an announcement disclosing such details as soon as practicable, and in any event by no later than the time it is required to make its Opening Position Disclosure under Rule 8.1 of the Code."

Rule 2.9 Disclosure

In accordance with Rule 2.9 of the Code, as at the close of business on 22 May 2024 (being the business day prior to the date of this announcement), NewRiver confirms that its issued share capital consisted of 313,686,292 ordinary shares of one penny each with voting rights, of which 3,317,219 ordinary shares are held in the Employee Benefit Trust (EBT). Accordingly, the total number of voting rights in the Company is 310,369,074. The Company does not hold any shares in treasury. The International Securities Identification Number (ISIN) of the ordinary shares is GB00BD7XPJ64.

About NewRiver

NewRiver REIT plc ("NewRiver") is a leading Real Estate Investment Trust specialising in buying, managing and developing resilient retail assets throughout the UK.

Our £0.54 billion UK wide portfolio covers 6.1 million sq ft and comprises 24 community shopping centres and 12 conveniently located retail parks occupied by tenants predominately focused on essential goods and services. In addition, we manage 18 retail parks and 5 shopping centres on behalf of Capital Partners, taking our total Assets Under Management to £1.3 billion. Our objective is to own and manage the most resilient retail portfolio in the UK, focused on retail parks, core shopping centres, and regeneration opportunities in order to deliver long term attractive recurring income returns and capital growth for our shareholders.

NewRiver has a Premium Listing on the Main Market of the London Stock Exchange (ticker: NRR). Visit www.nrr.co.uk for further information.

LEI Number: 2138004GX1VAUMH66L31