LIB Libertine Holdings Plc

29 April 2024

This is an announcement made under Rule 2.4 of the City Code on Takeovers and Mergers (the "Takeover Code") and is not an announcement of a firm intention by any party to make an offer under Rule 2.7 of the Takeover Code. There can be no certainty that an offer will be made for Libertine Holdings PLC, nor as to the terms on which any offer may be made.

This announcement contains inside information for the purposes of Article 7 of Regulation (EU) No 596/2014 as it forms part of UK domestic law by virtue of the European Union (Withdrawal) Act 2018 ("MAR").

Libertine Holdings PLC

("Libertine" the "Company" or the "Group")

Strategic Review & Formal Sale Process

The board of directors of Libertine Holdings PLC (LSE AIM: LIB), a developer of Linear Generator technology, has decided to conduct a formal review of the various strategic options available to the Company to maximise value for shareholders, employees, and other stakeholders (the "Strategic Review").

The Board and the management believe that whilst good technical and commercial progress has been made since IPO, further resources are required to advance the technology into customer programmes and full commercialisation. While all options are under consideration, including raising additional equity and a sale process, there can be no assurance that the Strategic Review will result in any transaction, nor as to the terms of any transaction.

The Strategic Review will include an exploration of a wide range of options including, but not limited to, the merits of Libertine remaining a standalone publicly listed company. It must be emphasised that this is just one of multiple alternatives being evaluated. The Board has decided that the sale process element of the Strategic Review should be undertaken under the mechanism referred to in the City Code on Takeovers and Mergers (the "Takeover Code") as a "Formal Sale Process". There can be no certainty that an offer will be made for the Company nor as to the terms of which any offer may be made.

Background to the Strategic Review

Since its IPO in December 2021, Libertine has developed its Linear Generator platform and delivered on a number of customer and grant funded programmes, including:

·    Completion of Phase 1 design, integration and demonstration of Libertine's HEXAGEN™ technology platform within the KARNO™ linear generator of Hyliion Holdings Corp. (NYSE: HYLN, "Hyliion"), and the KARNO Hypertruck vehicle demonstrator was exhibited at the ACT Expo in Anaheim, California in May 2023. In October 2023, Hyliion changed its strategic focus to concentrate solely on stationary power generation applications using the KARNO linear generator technology.

·    Developing and demonstrating its intelliGEN™ technology platform through to its current technology readiness level, which is planned to satisfy stage-gate performance requirements for entry into OEM new product development programmes expected to commence in 2024.

Commercial interest in the Company's technology platforms remains good and the addressable market potential for Libertine's technology continues to expand, with the emergence of dispatchable power generation applications and passenger vehicle applications, alongside previously identified markets for heavy & light duty powertrain applications.

Libertine has recently signed strategic partnership agreements which the Board anticipates could support business development and pilot programme delivery in FY25.

Whilst the Company has made both technical and business development progress, further resources are required to advance the technology into customer programmes and support commercialisation across the range of applications that there is interest in.

Trading Update and Strategic Review process

As per the Company's trading update announced on 22 March 2024, the Group has cash reserves, absent any additional revenues to maintain current operations through to July 2024. The Company has been reviewing options to extend its funding position.

In this context, the Board has determined that it is now appropriate to undertake a formal review of its corporate strategy and options to maximise value for its shareholders, employees, and other stakeholders. This Strategic Review will cover a range of options with a number of possible outcomes including but not limited to:

1)  raising additional capital from the Company's existing shareholders, new investors and/or strategic partners to support further development and commercialisation of the Company's intelliGEN and HEXAGEN technology platforms;

2)   sale of the Company's HEXAGEN technology platform and IP, in order to focus cash proceeds on further development and commercialisation of the Company's intelliGEN platform, and;

3)   sale of the Company, which would be conducted under the framework of a "formal sale process" in accordance with the Takeover Code.

The Board will undertake the review in a timely but structured manner, evaluating merits of each of the outcomes above, and potentially others that may arise, in defining the future corporate strategy for the Company.

Formal Sale Process and Takeover Code considerations

The Strategic Review will be undertaken under the mechanism referred to in the Takeover Code as a "Formal Sale Process".

The Company has appointed Panmure Gordon (UK) Limited ("Panmure Gordon") as Financial Advisor solely for the purposes of the Formal Sale Process. Parties interested in submitting an expression of interest should contact Panmure Gordon using the contact details below. It is currently expected that any party interested in submitting any form of proposal for consideration in connection with the Formal Sale Process will, at the appropriate time, enter into a non-disclosure agreement and standstill arrangement with the Company on terms satisfactory to the Board and on the same terms, in all material respects, as other interested parties before being permitted to participate in the process. The Company then intends to provide such interested parties with certain information on its business, following which interested parties shall be invited to submit their proposals. The Company will update the market in due course regarding timings for the formal sale process.

The Board reserves the right to alter or terminate any aspect of the process as outlined above at any time, and to reject any approach or terminate discussions with any interested party at any time, and in such cases will make an announcement as appropriate.

The Company is not currently in discussions with, or in receipt of an approach from, any potential offeror at the date of this announcement. The Company will make further announcements as appropriate. The Takeover Panel has granted a dispensation from the requirements of Rules 2.4(a), 2.4(b) and 2.6(a) of the Takeover Code such that any party participating in the formal sale process will not be required to be publicly identified under Rules 2.4(a) or (b) and will not be subject to the 28 day deadline referred to in Rule 2.6(a) of the Takeover Code for so long as it is participating in the process. Following this announcement, the Company is now considered to be in an "offer period" as defined in the Takeover Code, and the dealing disclosure requirements will apply.

Shareholders are advised that this announcement does not represent a firm intention by any party to make an offer under Rule 2.7 of the Takeover Code and there can be no certainty that any offers will be made as a result of the formal sale process, that any sale, strategic investment or other transaction will be concluded, nor as to the terms on which any offer, strategic investment or other transaction may be made.

The person responsible for making this announcement on behalf of the Company is Sam Cockerill, Chief Executive Officer.

For more information, please visit www.libertine.co.uk or contact:

About Libertine

Founded in 2009, Libertine provides technology platform solutions for Original Equipment Manufacturers ("OEMs"), enabling efficient and clean power generation from renewable fuels, and more effective energy storage devices and gas compressor systems. Libertine was admitted to trading on the AIM market of the London Stock Exchange in December 2021. 

Libertine has created two technology platforms, each using the same core technology elements, which the Company provides to its OEM customers for their development of Linear Generator and Linear Motor products:

-       The intelliGEN™ platform enables the creation of clean, highly efficient and fuel-flexible Linear Generator products including:

•      Heavy-duty hybrid powertrains of trucks, buses, tractors, construction and mining equipment;

•      Medium and light-duty hybrid powertrains of commercial vehicles operating over longer distances;

•      A proportion of the passenger automotive market where vehicle use and recharging constraints are a barrier to battery electrification; and

•      A wide range of off-grid, portable power and distributed power generation applications.

-       The HEXAGEN^TM platform enables more effective energy storage, thermal power generation, waste heat recovery and gas compression products including:

•      Stirling Engine power generators and thermal energy storage systems;

•      Linear motor reciprocating compressor (LMRC) systems for hydrogen refuelling stations; and

•      Organic Rankine Cycle waste heat recovery systems.

These two platforms are a result of over a decade of development and performance validation of Libertine's proprietary core technology elements including its linear electrical machines, controls and developer tools, and are protected by a broad international portfolio of over 40 granted patents, with multiple further patents pending protecting recent developments.

The potential market for Linear Generator products goes well beyond the distributed power generation applications where Linear Generators are already in commercial use today, complementing intermittent renewable power with clean, on-demand power generation. Linear Generators also have the potential to complement battery electrification in hybrid powertrains, providing on-board power generation to address the practical and economic barriers to rapid adoption of clean electric propulsion using battery electric powertrain technology alone.

Working with OEMs from an early stage in the development cycle ensures Libertine's technology is effectively integrated into OEM products, maximising the performance and economic benefits provided by Libertine's platform technology. Libertine has developed a portfolio of over 30 granted patents in addition to a significant body of technical know-how generated since the Company's formation. The Company's senior management team and board includes executives with decades of deep technical experience in the automotive and energy industries.

Important Notices

Panmure Gordon, which is authorised and regulated by the FCA in the UK, is acting as Financial Adviser, Nominated Adviser and Broker exclusively for Libertine and no one else in connection with the matters referred to in this announcement and will not be responsible to anyone other than Libertine for providing the protections afforded to its clients or for providing advice in relation to matters referred to in this announcement. Neither Panmure Gordon, nor any of its affiliates, owes or accepts any duty, liability or responsibility whatsoever (whether direct or indirect, whether in contract, in tort, under statute or otherwise) to any person who is not a client of Panmure Gordon in connection with this announcement, any statement contained herein or otherwise.

This announcement is for information purposes only and 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 whether pursuant to this announcement or otherwise.

This announcement (including any information incorporated by reference in this announcement), oral statements made regarding the formal sale process, and other information published by the Company contain statements about the Company that are or may be deemed to be forward looking statements. Without limitation, any statements preceded or followed by or that include the words "targets", "plans", "believes", "expects", "aims", "intends", "will", "may", "anticipates", "estimates", "projects" or words or terms of similar substance or the negative thereof, may be forward looking statements.

These forward-looking statements are not guarantees of future performance. 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. Due to such uncertainties and risks, readers should not rely on such forward-looking statements, which speak only as of the date of this announcement. The Company disclaims any obligation or responsibility to update publicly or review any forward-looking or other statements contained in this announcement, except as required by applicable law.

The distribution of this announcement in jurisdictions outside the United Kingdom may be restricted by law and therefore persons into whose possession this announcement comes should inform themselves about, and observe, such restrictions. Any failure to comply with the restrictions may constitute a violation of the securities law of any such jurisdiction.

The Formal Sales Process relates to the securities of a UK company and is subject to UK procedural and disclosure requirements that are different from those of the United States. Any financial statements or other financial information included in announcement may have been prepared in accordance with non-US accounting standards that may not be comparable to the financial statements of US companies or companies whose financial statements are prepared in accordance with generally accepted accounting principles in the United States.  It may be difficult for US holders of shares to enforce their rights and any claims they may have arising under the US federal securities laws in connection with the Formal Sales Process, since the Company is located in a country other than the United States, and some or all of their officers and directors may be residents of countries other than the United States.  US holders of shares may not be able to sue the Company or its officers or directors in a non-US court for violations of the US securities laws.  Further, it may be difficult to compel the Company and its respective affiliates to subject themselves to the jurisdiction or judgment of a US court.

Disclosure requirements of the Takeover 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 2.9 disclosure

For the purposes of Rule 2.9 of the Takeover Code, the Company confirms that, as at 26 April 2024, being the last practicable business day prior to the date of this announcement, it has 139,219,010 ordinary shares of £0.001 each in issue (the "Ordinary Shares").  The International Securities Identification Number for the Ordinary Shares is GB00BN6PSG15.

Publication on website

For the purposes of Rule 26.1 of the Takeover Code, a copy of this announcement will be made available (subject to certain restrictions relating to persons resident in restricted jurisdictions) on Libertine's website at www.libertine.co.uk promptly following its publication and in any event no later than 12 noon (London time) on the business day following the release of this announcement. The content of the website referred to in this announcement is not incorporated into and does not form part of this announcement.