Current report No. 43/2021

Disclosure of delayed inside information on the commencement of negotiations with a financial investor regarding an investment in eobuwie.pl S.A.

(Current Report No. 43/2021)

02.07.2021 /Issuer/

Legal basis:
Article 17 Section 1 of MAR – inside information


In this report the Management Board of CCC S.A. with its registered office in Polkowice (“CCC”) publishes information the public disclosure of which has been delayed pursuant to Article 17 Section 1 and 4 of Regulation No. 596/2014 of the European Parliament and Council of 16 April 2014 on market abuse (Market Abuse Regulation) and repealing the Directive 2003/6/WE of the European Parliament and Council as well as Commission Directives 2003/124/WE, 2003/125/WE and 2004/72/WE (the "MAR"), concerning the commencement of negotiations, conducted together with CCC Shoes & Bags sp. z o.o. with its registered office in Polkowice (“CCC S&B”), a subsidiary of CCC and the majority shareholder of eobuwie.pl S.A. (“eobuwie”), with a financial investor with regard to an investment in convertible bonds to be issued by eobuwie.pl S.A. (the “Inside Information”).

Pursuant to Article 17 Section 4 of MAR, the disclosure of the Inside Information to the public was delayed on 11.06.2021.

Contents of the delayed Inside Information:

The Management Board of CCC hereby informs that upon the completion of preliminary discussions with a financial investor (the “Investor”), on 11.06.2021, the Management Board of CCC decided to commence negotiations with the Investor regarding the terms on which the Investor would acquire unsecured bonds of eobuwie.pl S.A. (“eobuwie”) subordinated to the existing indebtedness of eobuwie and convertible into eobuwie shares, with the total nominal value of PLN 500 million, with the redemption date on the third anniversary of the issue date, subject to early redemption/conversion into eobuwie shares under certain conditions set out in the terms and conditions of the bonds, including an initial public offering of eobuwie shares.

The convertible bonds would be issued pursuant to Article 33 item 1 or 2 of the Act on Bonds of 15 January 2015, under an exemption from the obligation to publish a prospectus, information memorandum or any other offering document. The convertible bonds would not be introduced to trading on any market.

The issuance of convertible bonds is one of the means to ensure financing for the eobuwie development plan, which the Issuer announced in its reports (among others Current Report No. 53/2020) and the Interim Consolidated Report of the Management Board on the CCC S.A. Capital Group’s Activities for the first half of 2020.

There are a number of conditions to reaching the final agreement on the terms of the transaction, the most important of which include an outcome of the due diligence review of eobuwie that is satisfactory to the Investor and obtaining all necessary consents, including corporate approvals of eobuwie’s corporate bodies, including, without limitation, approval of its current and future (depending on the transaction timing) shareholders expressed in the form of resolution(s) of the general shareholders’ meeting of eobuwie, and consents of the CCC/eobuwie group’s financing entities.

The Management Board has not yet made any binding decisions that would commit eobuwie to conducting the proposed transaction and the outcome of the negotiations of the transaction terms remains uncertain.

Substantiation of the delay in the disclosure of the Inside Information to the public:

The Management Board of CCC believes that the decision to delay the disclosure of the Inside Information satisfied, at the time of making that decision, the conditions set out in the MAR and in the guidelines issued pursuant to Article 17 section 11 of the MAR by the European Securities and Markets Authority on the MAR dated 20 October 2016.

In the view of CCC’s Management Board, disclosing the Inside Information immediately, during the preliminary actions conducted by the Company – a phase of a process extending over time and aimed at facilitating the transaction – would have infringed the legitimate interests of the Company and its capital group by adversely affecting the course of the negotiations or even precluded their successful finalization.

Successful completion of the process leading towards the transaction closing also depends on various conditions. The most important of these conditions include, among other things, obtaining all necessary consents, including corporate approvals of eobuwie corporate bodies, including, without limitation, approval of its current and future (depending on the transaction timing) shareholders expressed in the form of resolution(s) of the general shareholders’ meeting of eobuwie, and consents of the CCC/eobuwie group financing entities, which is an additional factor increasing the uncertainty of achieving a successful completion in the future.

The occurrence of any of the foregoing circumstances could have an adverse effect on the achievement of the business and financial goals adopted by CCC, and furthermore, the likelihood of the actual completion of the issuance was unknown at the time of making the decision.

The Management Board is convinced that there were no premises indicating that the delay in the disclosure of the Inside Information might mislead the public or investors as to the likelihood of the occurrence and terms of the transaction and result in the public making an incorrect assessment of the information and its potential impact on CCC’s value.

The Management Board of CCC also warrants that it has taken the steps required under the MAR to ensure the confidential treatment of the Inside Information until its becoming public, specifically by following the internal procedures governing the circulation and protection of information implemented at the Group level. At the time of making the decision to delay the disclosure of the Inside Information to the public, pursuant to Article 18 of the MAR, a list of individuals with authorized access to the Inside Information was made, which was systematically monitored and updated on an as-needed basis.

The Inside Information was delayed for the duration of the negotiations.

Considering the legitimate interests of CCC and its shareholders, and with a view to complying with the legal requirements of the MAR, CCC will issue a separate report to announce successful completion of the negotiations, as the case may be, and proceeding to the implementation of the actions described above, as well as on the terms of these actions, should such information be classified as inside information.

Pursuant to Article 17 Section 4 paragraph 3 of the MAR, promptly upon the disclosure of delayed inside information, CCC will notify the Polish Financial Supervision Authority of the delay in the disclosure of the inside information specifying the reasons therefor, pursuant to Article 4 Section 3 of Commission Implementing Regulation (EU) 2016/1055.

The Inside Information will not be disclosed to the public if it ceases to be inside information before the scheduled date of its publication, in particular as a result of CCC and CCC S&B or the Investor deciding to withdraw from the negotiations.

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