Company Announcements

Tender Offer

Source: RNS
RNS Number : 0734W
CLS Holdings PLC
15 August 2022




LEI: 213800A357TKB2TD9U78


CLS Holdings plc

("CLS" or the "Company")


Proposed purchase of 1 in every 40 Ordinary Shares of 2.5 pence each

in the Company ("Ordinary Shares") at 250 pence per share

by way of a tender offer (the "Tender Offer") and Notice of General Meeting


On 10 August 2022, the Board of CLS announced in its half yearly results for the period ended 30 June 2022 its intention to purchase 1 in every 40 Ordinary Shares by way of a tender offer at 250 pence per Ordinary Share.


Today CLS has posted a circular to shareholders in relation to the Tender Offer (the "Circular") on the terms set out above. If the maximum number of 10,184,984 Ordinary Shares is acquired under the Tender Offer, this will result in approximately £25.5 million being paid by the Company to participating shareholders.  Capitalised terms used but not defined in this announcement shall have the meaning given to them in the Circular.


The Tender Offer is open to all Qualifying Shareholders on the Company's register at 6.00pm on 9 September 2022, who may participate by tendering all or a proportion of their holdings of Ordinary Shares at the above price.  No Ordinary Shares will be purchased in relation to the Tender Offer unless the relevant special resolution to be proposed at the general meeting of the Company to be held on 9 September 2022 at 11.00am is passed.  The Tender Offer will be void if less than 0.1 per cent. of the issued ordinary share capital of the Company (excluding treasury shares) in aggregate is tendered. The Ordinary Shares purchased under the Tender Offer will be held as treasury shares.


Background to and reasons for the Tender Offer


During the first six months of the current financial year, the Board completed two property disposals, realising an aggregate of £10.1 million at prices that were in line with their valuations as at 31 December 2021.


Furthermore, on 3 August 2022, CLS announced that it had completed on the sale of two UK properties, Great West House, Brentford and 62 London Road, Staines and one French property, 96 Rue Nationale, Lille for a total of £39.8 million. The three properties sold for an average of 3.7% above the 31 December 2021 valuations.


The share price of an Ordinary Share has continued to trade at a significant discount to the net tangible assets ("NTA") value of an Ordinary Share (last reported NTA per Ordinary Share of 352.8 pence per Ordinary Share, stated as at 30 June 2022). The Board believes the share price discount to its NTA is unjustified and it is in the best interests of all Shareholders to implement the Tender Offer to reduce this discount.


The Board has determined that the Tender Offer should be made at an appropriate premium to the price per Ordinary Share and that this would be the most suitable way of returning capital to Shareholders in a quick and efficient manner, taking account of the relative costs, complexity and timeframes of the possible methods, as well as treating all Shareholders equally.


The Board of Directors of the Company considers the Tender Offer to be beneficial to the Shareholders as a whole, including, among other reasons, that:

·      the Tender Offer is available to all Qualifying Shareholders regardless of the size of their holding;

·      the Tender Price represents a premium over the price of Ordinary Shares, as follows:

a premium of 22.5% to the average of the Company's Ordinary Shares closing price of 204.0 pence for the 30 Business Days to the Latest Practicable Date; and

a premium of 18.8% to the Company's Ordinary Shares closing price of 210.5 pence on the Latest Practicable Date.

a premium of 20.2% to the Company's Ordinary Shares closing price of 208.0 pence on 9 August 2022 (the day prior to the release of the Company's half-year results).

·      the Tender Offer provides Qualifying Shareholders who wish to reduce their holdings of Ordinary Shares with an opportunity to do so at a market-driven price with a premium;

·      the Tender Offer permits Shareholders who wish to retain their current investment in the Company and their Ordinary Shares to do so, as no Shareholder is required to participate in the Tender Offer, and thus providing Shareholders with flexibility; and

·      the Tender Offer will reduce the number of Ordinary Shares in issue, and so should, assuming earnings and net asset values of the Group's properties stay the same, have a positive impact on the Group's earnings per share and net asset value per share.


The size of the Tender Offer has been determined to be appropriate to ensure that the Group's loan-to-value ratio and liquidity remain within an acceptable level, being below 40% within a suitable timeframe, and with cash and liquid resources and available facilities being over £100 million, providing the Group with the flexibility to focus its portfolio on attractive growth prospects and continue to invest to improve the quality of its existing portfolio.


2022 Interim Dividend


As the record date for the Tender Offer is the same as the record date for the 2022 Interim Dividend, Shareholders who participate in the Tender Offer will continue to receive the 2022 Interim Dividend, being 2.60 pence per Ordinary Share, in respect of any Ordinary Shares tendered.


Substantial Shareholders


The Sten and Karin Mortstedt Family & Charity Trust which, through wholly owned subsidiaries of Creative Value Investment Group, holds 51.46 per cent of the issued Ordinary Share Capital in the Company, and Bengt Mortstedt, who holds 6.52 per cent of the issued Ordinary Share Capital in the Company, have indicated to the Board that they intend to take up their pro rata entitlement under the Tender Offer.


Expected Timetable of Events


Latest time and date for receipt of proxy appointments

11.00 a.m. on 7 September 2022

Ex Dividend Date for 2022 Interim Dividend

8 September 2022

Record Date for 2022 Interim Dividend

9 September 2022

General Meeting

11.00 a.m. on 9 September 2022

Latest time and date for receipt of Tender Forms and TTE instructions from CREST Shareholders

3.00 p.m. on 9 September 2022

Tender Offer closes

3.00 p.m. on 9 September 2022

Record Date for the Tender Offer

6.00 p.m. on 9 September 2022

Outcome of Tender Offer announced

On 12 September 2022

Cheques despatched for certificated Ordinary Shares purchased pursuant to the Tender Offer and payment through CREST for uncertificated Ordinary Shares purchased pursuant to the Tender Offer

By 16 September 2022

CREST accounts credited with uncertificated Ordinary Shares unsuccessfully tendered and despatch of balance share certificates for unsold certificated Ordinary Shares and share certificates for unsuccessful tenders of certificated Ordinary Shares

By 16 September 2022

2022 Interim Dividend payment date

3 October 2022



Details of the action to be taken to participate in the Tender Offer and how to vote at the General Meeting are set out in the Circular. A summary of the taxation consequences of the Tender Offer for UK resident Shareholders is also set out in the Circular. However, Shareholders are advised to consult their own professional advisers regarding their own tax position.


Copies of the Circular, form of proxy and Tender Form have been submitted to the FCA's National Storage Mechanism and are available for inspection at


The Circular will also shortly be available on the CLS website at, in the Investor Relations section under Shareholder Documents.  Copies of the documents may also be obtained from the Company Secretary.





David Fuller

Company Secretary

CLS Holdings plc 

+44 (0)20 7582 7766


Liberum Capital Limited

Richard Crawley

Jamie Richards

+44 (0)20 3100 2000



Liberum Capital Limited, which is authorised and regulated in the United Kingdom by the FCA, is advising CLS in relation to the Tender Offer and no one else and will not be responsible to anyone other than CLS for providing the protections afforded to the customers of Liberum Capital Limited nor for providing any advice in relation to the Tender Offer, the contents of this announcement or any transaction, arrangement or other matter referred to in this announcement.



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