DFP4_T10_AYK1_v3.pdf - RELIANCE WORLDWIDE CORPORATION...

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Unformatted text preview: RELIANCE WORLDWIDE CORPORATION LIMITED For personal use only ACN 610 855 877 PROSPECTUS INITIAL PUBLIC OFFERING OF ORDINARY SHARES Financial Adviser Sole Global Coordinator and Joint Lead Manager Joint Lead Manager CUSTOM E XTRUS I ONS For personal use only IMPORTANT IMPORTANT NOTICES NOTICES The Offer This Prospectus is issued by Reliance Worldwide Corporation Limited (ACN 610 855 877) (Company) for the purposes of Chapter 6D of the Corporations Act 2001 (Cth) (Corporations Act). The offer contained in this Prospectus is an initial public offering to acquire fully paid ordinary shares (Shares) in the Company (Offer). For personal use only References to ‘Reliance’ and ‘Restructure’ The Company was incorporated on 19 February 2016. Prior to the date of this Prospectus, the Company acquired (through a wholly owned subsidiary) the entities that carry on the Australian operations of the ‘Reliance Worldwide Corporation’ business from Jayburn and GSA International. On the Restructure Completion Date, the Company will (subject to Shares being allotted to successful Applicants under the Offer) acquire the entities that carry on the international operations of the ‘Reliance Worldwide Corporation’ business, which are currently owned by GSA International. GSA International and Jayburn are together the ‘Existing Owners’, and are entities associated with Jonathan Munz (Chairman). The consolidation of the Australian and international business operations under a new holding company (being the Company) is being undertaken in connection with the Offer (Restructure) and pursuant to the terms of share sale agreements (Restructure Agreements). Unless otherwise specified, this Prospectus is prepared as if the Restructure has completed. References to Reliance throughout this Prospectus are references to the corporate group that will exist on the Restructure Completion Date following completion of the Restructure Agreements. For example, the Investment Overview in Section 1 and the Company Overview in Section 3 describe Reliance as if the Restructure has completed, and the Financial Information in Section 4 represents the combined business operations of the Company and its wholly owned subsidiaries (as if the Restructure has completed) for the financial years ended 30 June 2013, 30 June 2014 and 30 June 2015, and the half years ended 31 December 2014 and 31 December 2015. Further details about the Restructure are set out in Section 3.1.2. The key terms of the Restructure Agreements are summarised in Section 9.4.2. Lodgement and Listing This replacement prospectus is dated 18 April 2016 (Prospectus Date) and was lodged with the Australian Securities and Investments Commission (ASIC) on that date. It is a replacement prospectus that replaces the prospectus dated 11 April 2016 and lodged with ASIC on that date (Original Prospectus). For the purposes of this document, this replacement prospectus will be referred to as the Prospectus. The key changes that have been made to the Original Prospectus are: • including additional disclosure regarding the consideration paid to the Existing Owners pursuant to the Restructure in Sections 1.1 and 1.7; • including additional disclosure regarding the interests of Jonathan Munz (Chairman) in the Offer in Section 6.3.1.2; • removing the word ‘Actual’ when referring to Historical Financial Information throughout the Prospectus; • including additional disclosure regarding the basis of preparation of the pro forma Historical Financial Information in Sections 4.2.2 and 4.3; • including additional disclosure regarding the basis of preparation of the Equity section of the pro forma and Combined Historical Balance Sheet at 31 December 2015 in Section 4.7, table 4.6; • including additional disclosure regarding the impact of the Indicative Price Range in Sections 4.8, table 4.9; and • including additional disclosure regarding the reconciliation of historical ‘net change in cash and cash equivalents’ to the items that reconcile this to ‘Combined Historical Cash Flows from operating activities’ in Section 4.9, table 4.11 The Company applied to the ASX on 12 April 2016 for admission of the Company to the official list and quotation of its Shares on the ASX. None of ASIC, ASX or their respective officers takes any responsibility for the contents of this Prospectus or the merits of the investment to which this Prospectus relates. As set out in Section 7.9, it is expected that the Shares will be quoted on the ASX, initially on a conditional and deferred settlement basis. The Company, Computershare Investor Services Pty Limited (Share Registry), and the Joint Lead Managers disclaim all liability, whether in negligence or otherwise, to persons who trade Shares before receiving their holding statement. Expiry Date This Prospectus expires on the date that is 13 months after the Prospectus Date (Expiry Date) and no Shares will be issued on the basis of this Prospectus after the Expiry Date. Note to Applicants The information in this Prospectus is not investment or financial product advice and does not take into account your investment objectives, financial circumstances, tax position or particular needs. It is important that you read this Prospectus carefully and in its entirety before deciding whether to invest in the Company. In particular, you should consider the assumptions underlying the Forecast Financial Information (as defined in Section 4.1.2) and the risk factors that could affect the performance of the Company and other information in this Prospectus. You should carefully consider these risks in light of your personal circumstances (including your investment objectives, financial circumstances and tax position) and seek professional guidance from your stockbroker, accountant, lawyer or other professional adviser before deciding whether to invest in the Company. Some of the key risk factors that should be considered by prospective investors are set out in Section 5. There may be risk factors in addition to these that should be considered in light of your personal circumstances. Reliance Worldwide Corporation Limited 1 IMPORTANT NOTICES Except as required by law, and only to the extent required, no person named in this Prospectus, nor any other person, warrants or guarantees the performance of the Company or the repayment of capital by the Company or any return on investment made pursuant to this Prospectus. This Prospectus includes information regarding past performance of Reliance. Investors should be aware that past performance is not indicative of future performance. For personal use only No person is authorised to give any information or to make any representation in connection with the Offer that is not contained in this Prospectus. Any information or representation not so contained may not be relied upon as having been authorised by the Company, the Joint Lead Managers or any other person in connection with the Offer. You should rely only on information contained in this Prospectus when deciding whether to invest in the Company. Important information for New Zealand investors This Offer to New Zealand investors is a regulated offer made under Australian and New Zealand law. In Australia, this is Chapter 8 of the Corporations Act and regulations made under that Act. In New Zealand, this is subpart 6 of Part 9 of the Financial Markets Conduct Act 2013 and Part 9 of the Financial Markets Conduct Regulations 2014.This Offer and the contents of this Prospectus are principally governed by Australian rather than New Zealand law. In the main, the Corporations Act and the regulations made under that Act set out how the Offer must be made. There are differences in how financial products are regulated under Australian law. For example, the disclosure of fees for managed investment schemes is different under the Australian regime. The rights, remedies, and compensation arrangements available to New Zealand investors in Australian financial products may differ from the rights, remedies, and compensation arrangements for New Zealand financial products. Both the Australian and New Zealand financial markets regulators have enforcement responsibilities in relation to this Offer. If you need to make a complaint about this Offer, please contact the Financial Markets Authority, New Zealand ( ). The Australian and New Zealand regulators will work together to settle your complaint. The taxation treatment of Australian financial products is not the same as for New Zealand financial products. If you are uncertain about whether this investment is appropriate for you, you should seek the advice of an appropriately qualified financial adviser. The Offer may involve a currency exchange risk. The currency for the financial products is not New Zealand dollars. The value of the financial products will go up or down according to changes in the exchange rate between that currency and New Zealand dollars. These changes may be significant. If you expect the financial products to pay any amounts in a currency that is not New Zealand dollars, you may incur significant fees in having the funds credited to a bank account in New Zealand in New Zealand dollars. If the financial products are able to be traded on a financial product market and you wish to trade the financial products through that market, you will have to make arrangements for a participant in that market to sell the financial products on your behalf. If the financial product market does not operate in New Zealand, the way in which the market operates, the regulation of participants in that market, and the information available to you about the financial products and trading may differ from financial product markets that operate in New Zealand. Financial Information presentation Section 4 sets out in detail the Financial Information referred to in this Prospectus and the basis of preparation of that information is set out in Section 4.2. The Financial Information included in Section 4 has been prepared in accordance with the recognition and measurement principles prescribed in Australian Accounting Standards (AAS) adopted by the Australian Accounting Standards Board (AASB), which are consistent with the International Financial Reporting Standards (IFRS) as issued by the International Accounting Standards Board and the accounting policies of the Company. The Forecast Financial Information included in this Prospectus is based on the best estimate assumptions of the Directors. The basis of preparation and presentation of the Forecast Financial Information is, to the extent applicable, consistent with the basis of preparation of the Historical Financial Information presentation. All financial amounts contained in this Prospectus are expressed in Australian currency and are rounded to the nearest $100,000 (unless otherwise stated). Any discrepancies between totals and sums of components in tables and figures contained in this Prospectus are due to rounding. Tables and figures contained in this Prospectus have not been amended by the Company to correct immaterial summation differences that may arise from this rounding convention. The Historical Financial Information and the Forecast Financial Information in this Prospectus should be read in conjunction with, and are qualified by reference to, the information contained in Section 4. Unless otherwise noted, historical financial information and metrics disclosed throughout this Prospectus are derived from the accounting records of the Reliance Worldwide Corporation Combined Group, which is described in Section 4.2.2. Where financial information and metrics represent pro forma amounts, they have been labelled “pro forma”. 2 Reliance Worldwide Corporation Limited Market and industry data based primarily on management estimates This Prospectus (and in particular Section 2) contains data relating to the industries, segments and end-markets in which Reliance operates (Industry Data). For personal use only Such information includes, but is not limited to, statements and data relating to: product segment and category sizes (by number of units and net sales in Australian and US Dollars), estimated historical and forecast market growth (by number of units and net sales in Australian and US Dollars), market segmentation (e.g. size of the repair and renovation end-market compared to the new construction end-market for a product segment), market trends and Reliance’s estimated market share and its industry position. Unless otherwise stated, this information has been prepared by the Company using both publicly available data and its own internally generated data. The Company’s internally generated data is based on estimates and assumptions that both the Directors and the Company’s management believe to be reasonable, as at the Prospectus Date. Please refer to the Appendix in Section 12 for further information about how the Industry Data has been prepared and the limitations on its usefulness. The Industry Data has not been independently prepared or verified and neither the Company nor the Joint Lead Managers can assure you as to its accuracy or the accuracy of the underlying assumptions used to estimate such Industry Data. The Company’s estimates involve risks and uncertainties and are subject to change based on various factors, including those described in the risk factors set out in Section 5. In addition to the Industry Data, this Prospectus uses third party market data, estimates and projections. There is no assurance that any of the third party data, estimates or projections contained in this information will be achieved. The Company has not independently verified this information. Estimates involve risks and uncertainties and are subject to change based on various factors, including those described in the risk factors set out in Section 5. Forward-looking statements This Prospectus contains forward-looking statements that are identified by words such as “may”, “could”, “believes”, “estimates”, “expects”, “intends”, “considers” and other similar words that involve known or unknown risks and uncertainties. The Forecast Financial Information included in Section 4 is an example of forward-looking statements. Any forward-looking statements involve known and unknown risks, uncertainties, assumptions and other important factors that could cause actual results, performance, events or outcomes to differ materially from the results, performance, events or outcomes expressed or anticipated in these statements, many of which are beyond the control of the Company and the Directors. Such forward-looking statements are based on an assessment of present economic and operating conditions on a number of best estimate assumptions regarding future events and actions that, at the Prospectus Date, are expected to take place. The Forecast Financial Information and the forward-looking statements should be read in conjunction with, and are qualified by reference to, the risk factors as set out in Section 5, the general and specific assumptions set out in Sections 4.11.1 and 4.11.2, the sensitivity analysis set out in Section 4.13 and other information contained in this Prospectus. The Directors cannot and do not give any assurance that the results, performance or achievements expressed or implied by the forward-looking statements contained in this Prospectus will actually occur and investors are cautioned not to place undue reliance on such forward-looking statements. Except where required by law, the Company does not intend to update or revise forward-looking statements, or to publish prospective financial information in the future, regardless of whether new information, future events or any other factors affect the information contained in this Prospectus. No offering where offering would be illegal This Prospectus does not constitute an offer or invitation in any place in which, or to any person to whom, it would not be lawful to make such an offer or invitation. No action has been taken to register or qualify the Shares or the Offer, or to otherwise permit a public offering of Shares, in any jurisdiction outside Australia. The distribution of this Prospectus outside Australia may be restricted by law and persons who come into possession of this Prospectus outside Australia should seek advice and observe any such restrictions. Any failure to comply with such restrictions may constitute a violation of applicable securities laws. This Prospectus may not be distributed to, or relied upon by, any person in the United States, unless accompanied by the U.S. Offering Memorandum, as defined in the Offer Management Agreement. In particular, the Shares have not been, and will not be, registered under the United States Securities Act of 1933, as amended (US Securities Act), or the securities laws of any state of the United States and may not be offered or sold in the United States unless the Shares are registered under the US Securities Act, or an exemption from the registration requirements of the US Securities Act and applicable US state securities laws is available. See Section 9.12 for more detail on selling restrictions that apply to the Offer and sale of Shares in jurisdictions outside Australia. Exposure Period The Corporations Act prohibits the Company from processing Applications in the seven day period after the date of the Original Prospectus (Exposure Period). The Exposure Period enabled the Original Prospectus to be examined by market participants prior to the processing of Applications. The Exposure Period expired on 18 April 2016. Applications received during the Exposure Period, and Applications received after the expiry of the Exposure Period but prior to lodgement of this Prospectus (dated 18 April 2016) have not been processed by the Company and will not receive any preference. Reliance Worldwide Corporation Limited 3 IMPORTANT NOTICES Prospectus availability During the Offer Period, a paper copy of this Prospectus is available free of charge to Australian and New Zealand resident investors by calling the Reliance Offer Information Line on 1300 781 374 (within Australia) and +61 3 9415 4681 (outside Australia) from 8.30am to 5.00pm (Melbourne time), Monday to Friday (excluding public holidays). This Prospectus is also available to Australian and New Zealand resident investors in electronic form at the Offer website, . The website will only be available to Applicants in New Zealand after the expiry of the Exposure Period. For personal use only The Offer constituted by this Prospectus in electronic form is available only to persons downloading or printing it within Australia and is not available to persons in any other jurisdiction (including the United States). Persons who access the electronic version of this Prospectus must ensure that they download and read the entire Prospectus. Applications Applications may be made only during the Offer Period by completing an Application Form in respect of either the Broker Firm Offer or the Priority Offer (whichever is relevant to you and which is generally referred to as an Application Form) attached to, or accompanying, this Prospectus in its paper copy form, or in its electronic form, which must be downloaded in its entirety from the Offer website, . By making an Application, you represent and warrant that you were given access to the Prospectus, together with an Application Form. The Corporations Act prohibits any person from passing on to another person an Application Form unless it is attached to, or accompanied by, the complete and unaltered version of this Prospectus. No cooling-off rights Cooling-off rights do not apply to an investment in Shares issued under the Prospectus. This means that, in most circumstances, you cannot withdraw your Application once it has been accepted. Definitions Defined terms and expressions used in this Prospectus are explained in the Glossary at the end of this Prospectus. Unless other...
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