Proposed return of up to £6.1m to shareholders

3 March 2025

THE INFORMATION CONTAINED IN THIS ANNOUNCEMENT IS RESTRICTED AND IS NOT FOR PUBLICATION, RELEASE OR DISTRIBUTION IN WHOLE OR IN PART IN THE UNITED STATES, AUSTRALIA, CANADA, JAPAN, NEW ZEALAND, THE REPUBLIC OF SOUTH AFRICA OR ANY OTHER JURISDICTION WHERE ITS RELEASE, PUBLICATION OR DISTRIBUTION IS OR MAY BE UNLAWFUL. THIS ANNOUNCEMENT DOES NOT CONSTITUTE AN INVITATION TO PARTICIPATE IN THE TENDER OFFER (AS DEFINED HEREIN) IN OR FROM ANY JURISDICTION IN OR FROM WHICH, OR TO OR FROM ANY PERSON TO OR FROM WHOM, IT IS UNLAWFUL. TO MAKE SUCH OFFER UNDER APPLICABLE SECURITIES LAWS OR OTHERWISE.

THIS RELEASE CONTAINS INSIDE INFORMATION WITHIN THE MEANING OF ARTICLE 7(1) OF THE EU MARKET ABUSE REGULATION (2014/596/EU), OR EU MAR, AND OF THE UK VERSION OF THE EU MAR AS IT FORMS PART OF UK LAW BY VIRTUE OF THE EUROPEAN UNION (WITHDRAWAL) ACT (AS AMENDED).

Bigblu Broadband plc

(the "Company")

Proposed return of up to £6.1 million to shareholders

On 23 December 2024, the Bigblu Broadband plc (AIML BBB.L), a leading provider of alternative super-fast and ultra-fast broadband services, announced the completion of the disposal of its Australian subsidiary, SkyMesh, to a newly formed bidco SKM Telecommunication Services Pty Ltd. Pursuant to the terms of the disposal, on completion the Company received a cash payment of AUD$30.0 million (c.£14.9 million). As set out in the circular to shareholders dated 3 December 2024, it was the intention of the Board to assess its ongoing capital requirements with the intention to return any surplus cash to Shareholders post-repayment of Santander facilities together with accrued interest and charges.

Accordingly, the Company announces that it will shortly be posting a circular (the "Circular") setting out the details of a proposed return of capital to Shareholders of up to £6.1 million by way of a purchase of up to 15,250,000 Ordinary Shares held by Qualifying Shareholders (the "Tender Offer"). The Tender Offer will be conducted at a fixed price of 40 pence per Ordinary Share, representing a premium of approximately 42.9 per cent to the mid-market closing price on the 28 February 2025 (the "Latest Practicable Date"); and a premium of approximately 25 per cent. to the volume weighted average price of 32 pence per Ordinary Share over three months prior to the Latest Practicable Date.

If the maximum number of Ordinary Shares under the Tender Offer is acquired, this will result in the purchase of approximately 26 per cent. of the Company's Issued Ordinary Share Capital as at the Latest Practicable Date.

The Tender Offer is being effected by Cavendish, the Company's corporate broker, as principal on the basis that all Ordinary Shares that it buys under the Tender Offer will be subsequently repurchased from it by the Company pursuant to the terms of the Option Agreement. All shares purchased from Cavendish by the Company will be cancelled.

The Circular sets out the background to and reasons for the Tender Offer and the Capital Reduction and why the Directors believe the Tender Offer and the Capital Reduction to be in the best interests of the Company and its Shareholders as a whole. The Circular also contains details on the procedure that should be followed by those Qualifying Shareholders who wish to participate in the Tender Offer. Qualifying Shareholders are not obliged to tender any of their Ordinary Shares if they do not wish to do so.

Capitalised terms in this announcement shall have the same meaning as set out in the Circular.

For further information

This announcement includes statements that are, or may be deemed to be, "forward-looking statements". These forward-looking statements can be identified by the use of forward-looking terminology, including the terms "believes", "estimates", "forecasts", "plans", "prepares", "targets", "anticipates", "projects", "expects", "intends", "may", "will", "seeks", or "should" or, in each case, their negative or other variations or comparable terminology, or by discussions of strategy, plans, objectives, goals, future events or intentions. These forward-looking statements include all matters that are not historical facts. They appear in a number of places throughout this announcement and include statements regarding the Company's and the Directors' intentions, beliefs or current expectations concerning, amongst other things, the Company's prospects, growth and strategy. No statement in this announcement is intended to be a profit forecast and no statement in this announcement should be interpreted to mean the Company's performance in future would necessarily match or exceed the historical published performance of the Company.

By their nature, forward-looking statements involve risks and uncertainties because they relate to future events and depend on circumstances that may or may not occur in the future. Forward-looking statements are not guarantees of future performance. The Company's actual performance, achievements and financial condition may differ materially from those expressed or implied by the forward-looking statements in this announcement. In addition, even if the Company's results of operations, performance, achievements and financial condition are consistent with the forward-looking statements in this announcement, those results or developments may not be indicative of results or developments in subsequent periods.

Any forward-looking statements that the Company makes in this announcement speak only as of the date of such statement, and none of the Company or the Directors undertake any obligation to update such statements unless required to do so by applicable law. Comparisons of results for current and any prior periods are not intended to express any future trends or indications of future performance, unless expressed as such, and should only be viewed as historical data.

1.   Background and reasons for the Capital Reduction and Tender Offer

On 23 December 2024, the Company announced the completion of the disposal of its Australian subsidiary, SkyMesh, to a newly formed bidco SKM Telecommunication Services Pty Ltd. Pursuant to the terms of the disposal, on completion the Company received total consideration of c.AUD$43.3 million (c.£21.6 million) of which AUD$30m was satisfied in cash and AUD$13.3 million was satisfied through the issue of shares in SKM Telecommunications, the entity that acquired SkyMesh.

Following receipt of the cash on completion, the Company has repaid all of its outstanding revolving credit facility with Santander including accrued interest and charges (c.£6.9 million) and settled all deal and related costs of c.£0.9 million. The Board undertook to Shareholders that it would undertake a review of its current and future capital requirements with the expectation that it would return surplus cash to shareholders having assessed its requirements. Post this review, the Board is delighted to announce a proposed capital return of £6.1 million by way of the Tender Offer.

In order to create sufficient distributable reserves to make the Tender Offer, the Company has to undertake a Capital Reduction.

The Company has built up a substantial Capital Redemption Reserve and Share Premium Account Reserve. At the date of this document, the reserves held in the Capital Redemption Reserve are £26,120,129 and the reserves held in the Share Premium Account Reserve are £8,608,265. It is proposed that the Capital Redemption Reserve be reduced to zero and the Share Premium Account Reserve reduced by £5,879,871, so £2,728,394 will be left in the Share Premium Account Reserve.

Following the implementation of the Capital Reduction there will be no change in the number of Ordinary Shares in issue. If approved by Shareholders and subsequently confirmed by the Court in the terms proposed by your Board, the effect of the Capital Reduction will be to release the entire amount standing to the credit of the Capital Redemption Reserve and the part of the amount standing to the credit of the Share Premium Account Reserve so that £32 million is credited to the distributable reserves of the Company. The implementation of the Capital Reduction is subject to a number of criteria and legal processes which are explained further below.

The Capital Redemption Reserve relates to the cash redemption of the bonus B shares issued in order to return £26 million to ordinary shareholders in October 2021, equivalent to 45 pence per share. This followed the disposals of the Company's European satellite broadband assets and the majority of its stake in Quickline Communications Limited. These disposals realised significant value for shareholders and also allowed the Company to repay its debt facilities in their entirety and secure a new RCF, with its lead banking partner Santander.

In particular, the Capital Redemption Reserve and Share Premium Account Reserve are non-distributable capital reserves and the Company's ability to use any amount credited to those reserves is limited by the Companies Act 2006. However, with the approval of its shareholders by way of a special Resolution and subsequent confirmation by the Court, a company may reduce or cancel its capital redemption reserve and share premium account reserve and in certain circumstances either return all or part of the sum arising to shareholders as a return of capital, or credit some or all of such sum arising to its profit and loss account.

To the extent that the release of such a sum from the Capital Redemption Reserve and Share Premium Account Reserve creates or increases a credit on the profit and loss account, that sum represents distributable reserves of the Company.

2.   The Capital Reduction

The Proposal requires the approval of the Shareholders by special Resolution at the General Meeting and the Capital Reduction requires subsequent confirmation by the Court. If the Resolution is passed at the General Meeting, it is proposed that an application will be made shortly thereafter to the Court to confirm the Capital Reduction. It is expected that the final hearing of the application will take place on 15 April 2025.

On the hearing of the Company's application, the Court will be concerned to ensure that the Company's creditors are not prejudiced by the Capital Reduction. The Company and the Directors will take such steps to satisfy the Court in this regard as they consider appropriate. Such steps may include seeking the consent of the Company's creditors to the Capital Reduction or the provision by the Company to the Court of an undertaking to deposit a sum of money into a blocked account created for the purpose of discharging the non-consenting creditors of the Company. If the Court makes the appropriate order, the Capital Reduction will become effective when the order has been registered by the Registrar of Companies which is expected to take place within 21 days following 15 April 2025.

The Board has undertaken a thorough and extensive review of the Company's liabilities (including prospective and contingent liabilities) and considers as at the date of this document that the Company will be able to satisfy the Court that, as at the date (if any) on which the Court Order relating to the Capital Reduction and the statement of capital in respect of the Capital Reduction have both been registered by the Registrar of Companies at Companies House, the Company's creditors will not be prejudiced and/or will be sufficiently protected to the satisfaction of the Court.

The Capital Reduction will not involve any distribution or repayment of capital and will not reduce the underlying net assets of the Company.

The Board reserves the right to abandon or discontinue (in whole or in part) the Capital Reduction and the application to the Court in the event that the Board considers that the terms on which the Capital Reduction would be (or would likely to be) confirmed by the Court would not be in the best interests of the Company and/or the Shareholders as a whole.

The Capital Reduction is dependent on the Resolution being passed and upon being confirmed by the Court. If the Resolution is not passed or the Capital Reduction is not confirmed by the Court, the Capital Reduction will not proceed. The Board is recommending the Capital Reduction.

Subject to the completion of the Capital Reduction and the passing of the Tender Offer Resolution by Shareholders at the General Meeting, the Directors' current intention is to give Qualifying Shareholders the opportunity to tender their Ordinary Shares through the Tender Offer for cash. Each Qualifying Shareholder will be entitled to sell up to approximately 26 per cent. of the Ordinary Shares registered in their name on the Register as at the Tender Offer Record Date (the "Basic Entitlement"), rounded down to the nearest whole number of Ordinary Shares under the Tender Offer.

The Tender Offer Resolution will give the Directors authority to distribute approximately £6.1 million to Shareholders through the Tender Offer at a fixed price per share of 40 pence (the "Tender Price"). The Tender Price represents a premium of approximately 42.9% to the closing price of a Company Ordinary Share on 28 February 2025, the last practical dealing day prior to the announcement of the Tender Offer.

3.   Benefits of the Tender Offer

The Board considered the various options for returning cash to Shareholders and determined that the Tender Offer would be the most appropriate method. In particular, the Tender Offer:

i.    is available to all Qualifying Shareholders regardless of the size of their holding;

ii.    provides Qualifying Shareholders with the choice of whether or not they wish to tender all, part or none of their respective Basic Entitlements and thus permits Shareholders who wish to retain their current investment in the Company in Ordinary Shares to do so; and

iii.   will allow the Company to broaden the return of cash to include those Qualifying Shareholders whose Ordinary Shares might not otherwise be purchased by the Company through a general on-market buy back.

4.   Structure of the Tender Offer

The Tender Offer will be implemented on the basis of Cavendish, as principal, acquiring the successfully tendered Ordinary Shares at the Tender Price. Immediately following completion of the Tender Offer, Cavendish shall sell such Ordinary Shares to the Company at the Tender Price, pursuant to the Option Agreement. These acquisitions by the Company will be market purchases in accordance with the provisions of the Companies Act 2006 and the rules of the London Stock Exchange and the FCA. It is expected that Qualifying Shareholders who successfully tender their Ordinary Shares will receive payment for such Ordinary Shares by 6 May 2025. In turn, Cavendish has the right to require the Company to purchase such Ordinary Shares from it at the same price under the Option Agreement, details of which are set out in paragraph 1.3 of Part IV of this document. If Cavendish does not exercise its right to require the Company to purchase such Ordinary Shares, the Company has the right - and intends to exercise such right if Cavendish has not exercised its right by 6.00 p.m. on 25 April 2025 (being the day which is three Business Days after the closing date of the Tender Offer) - to require Cavendish to sell such Ordinary Shares to it at the Tender Price. The Company intends to cancel any repurchased Ordinary Shares.

The Tender Offer will be open to all Shareholders on the Register on the Tender Offer Record Date, save for those who are Shareholders subject to the securities laws of a Restricted Jurisdiction. Qualifying Shareholders must consider carefully all of the information contained in the Circular as well as their personal circumstances when deciding whether to participate in the Tender Offer.

Qualifying Shareholders may participate in the Tender Offer by tendering either all or a proportion of their registered holdings of Ordinary Shares. Each Qualifying Shareholder will be entitled to sell their Basic Entitlement under the Tender Offer (subject only to any scaling back as a result of shareholdings of 200 or fewer Ordinary Shares being accepted as referred to in paragraph 2.18 of Part IV). The Tender Offer will also present tendering Qualifying Shareholders with an opportunity to sell an Individual Excess Tender to the extent that other Shareholders tender less than their Basic Entitlement.

The Tender Offer is subject to, amongst other things, the passing of the Tender Offer Resolution.

To the extent that any Shareholders have tendered less than their Basic Entitlement under the Tender Offer, Individual Excess Tenders will be accepted in proportion to the Total Excess Tenders so that the total number of Ordinary Shares purchased pursuant to the Tender Offer does not exceed 15,250,000. The process by which Individual Excess Tenders will be scaled back, if necessary, is described further in paragraph 2.18 of Part IV of the Circular.

As at 28 February 2025, being the Latest Practicable Date before the publication of the Circular, there are 58,847,018 Ordinary Shares in issue. Should the maximum number of Ordinary Shares be validly tendered, up to 15,250,000 Ordinary Shares may be purchased under the Tender Offer for a maximum aggregate consideration of approximately £6.1 million. Following completion of the Tender Offer, the Issued Ordinary Share Capital will be reduced to 43,597,018 Ordinary Shares, assuming the Tender Offer is taken up in full.

The Tender Offer will close at 1.00 p.m. on 22 April 2025 and tenders received after that time will not be accepted (unless the Tender Offer is extended).

5.   Purchase of Ordinary Shares

Successfully tendered Ordinary Shares will be purchased from Qualifying Shareholders by Cavendish, acting as principal free of commission and dealing charges.

Any Ordinary Shares repurchased by the Company from Cavendish following the purchase by Cavendish will be cancelled. Any rights of Shareholders who do not participate in the Tender Offer will be unaffected by the Tender Offer.

All Shareholders who tender Ordinary Shares will receive the Tender Price, subject, where applicable, to the scaling-down arrangements described below and set out in full in paragraphs 2.17 and 2.18 of Part IV of the Circular.

If more than 15,250,000 Ordinary Shares are validly tendered by Qualifying Shareholders and the Tender Offer is oversubscribed, acceptances of validly tendered Ordinary Shares will be scaled-down to determine the extent to which individual tenders are accepted. Accordingly, where scaling-down applies, beyond a Qualifying Shareholder's Basic Entitlement there is no guarantee that all of the Ordinary Shares which are tendered by Qualifying Shareholders will be accepted for purchase.

6.   Circumstances in which the Tender Offer may not proceed

There is no guarantee that the Tender Offer will take place. The Tender Offer is conditional on, among other things:

i.    the passing of the Capital Reduction Resolution and the Tender Offer Resolution as set out in the Notice of General Meeting and on satisfaction of the other conditions specified in Part IV of the Circular; and

ii.    approval of the Capital Reduction by the Court and subsequent completion of the Capital Reduction.

The Tender Offer is also conditional on there not arising any material adverse change or certain other force majeure events prior to the closing of the Tender Offer. Further details of these conditions are set out in paragraph 2 of Part IV of the Circular.

The Company has reserved the right at any time prior to the announcement of the results of the Tender Offer, with the prior consent of Cavendish, to extend the period during which the Tender Offer is open and/or vary the aggregate value of the Tender Offer, based on market conditions and/or other factors, subject to compliance with applicable legal and regulatory requirements. The Company has also reserved the right, in certain circumstances, to require Cavendish, not to proceed with the Tender Offer. Any such decision will be announced by the Company through a Regulatory Information Service.

7.   Full terms and conditions of the Tender Offer

Full details of the Tender Offer, including the terms and conditions on which it is made, will be set out in Part IV of the Circular. Some questions and answers related to the Tender Offer will be set out in Part VI of the Circular.

8.   Trading update

The Company's financial year concluded on 30 November 2024, prior to the announcement of the proposed disposal of SkyMesh. FY24 also saw the Company successfully dispose of its Nordic operations in May 2024. The Company expects to announce its full year results for the year ended 30 November 2024 in May 2025, following the conclusion of the Tender Offer and expects to report Group revenues of approximately £23.4 million and adjusted EBITDA of c.£3.0 million for the continuing operations and discontinued operations of the Group (therefore including the Nordic business sold in May 2024 and SkyMesh sold post year end in December 2024). These figures remain subject to audit.

9. General Meeting to approve the Capital Reduction Resolution and the Tender Offer Resolution

In order to comply with applicable company law, the Capital Reduction and Tender Offer requires the approval of Shareholders at a general meeting of the Company. The Company is convening a General Meeting for 10.00 a.m. on 19 March 2025 to consider and, if thought fit, pass:

i.  the Capital Reduction Resolution to authorise and to approve the reduction of the Capital Redemption Reserve and Share Premium Account Reserve and the creation of distributable reserves; and

ii.   the Tender Offer Resolution to authorise and to approve the terms under which the Tender Offer will be effected.

The Board believes that it is in Shareholders' best interests to conduct this General Meeting, and if approved, confirm the results of the Tender Offer as soon as possible. The Tender Offer Resolution must be passed by a majority of at least 75 per cent. of the votes cast at the General Meeting. The Company will not purchase Ordinary Shares pursuant to the Tender Offer unless the Tender Offer Resolution is duly passed.

Shareholders will find enclosed with this document a Form of Proxy for use in connection with the General Meeting. Whether or not you intend to tender any of your Ordinary Shares under the Tender Offer you are requested to complete and return the Form of Proxy as soon as possible and, in any event, so as to be received by Share Registrars Limited, 3 The Millenium Centre, Crosby Way, Farnham, GU9 7XX no later than 10.00 a.m. on 17 March 2025.

The Company strongly encourages all Shareholders to submit their Form of Proxy, appointing the Chairman of the General Meeting as proxy. To appoint more than one proxy, additional Forms of Proxy may be obtained by contacting the Shareholder Helpline on +44 (0) 1252 821390 between 9.00 a.m. and 5.00 p.m. (London time) from Monday to Friday (excluding public holidays in England and Wales) or you may photocopy this form. Please indicate in the box next to the proxy holder's name (see reverse) the number of shares in relation to which they are authorised to act as your proxy. Please also indicate by ticking the box provided if the proxy instruction is one of multiple instructions being given. All forms must be signed and should be returned together in the same envelope.

Alternatively, you may appoint a proxy or proxies electronically by using the CREST electronic voting service or by visiting www.shareregistrars.uk.com, clicking on the "Proxy Vote" button and then following the on-screen instructions.

The completion and return of a Form of Proxy will not preclude Shareholders from attending the General Meeting and voting in person should they wish to do so.

10.  Tax

Shareholders should be aware that there will be tax considerations that they should take into account when deciding whether or not to participate in the Tender Offer. Summary details of certain UK taxation considerations are set out in Part V of the Circular.

11.  Overseas Shareholders

The attention of Shareholders who are not resident in the United Kingdom is drawn to 6 of Part IV of the Circular.

Qualifying Shareholders who are in any doubt as to their tax position or who are subject to tax in a jurisdiction other than the UK are strongly recommended to consult an appropriate professional adviser before tendering their Ordinary Shares under the Tender Offer.

12.  Takeover Code

Under Rule 9 of the Takeover Code, any person who acquires an interest (as defined in the Takeover Code) in shares which, taken together with shares in which the person is already interested, and in which persons acting in concert with that person is interested, carry 30 per cent. or more of the voting rights of a company which is subject to the Takeover Code, is normally required to make a general offer to all the remaining Shareholders to acquire their shares at the highest price paid by that person (or any persons acting in concert with them) for shares in the company within the preceding 12 months.

Rule 9 of the Takeover Code also provides that any person, together with persons acting in concert with that person, is interested in shares which in the aggregate carry not less than 30 per cent. of the voting rights of a company to which the Takeover Code applies but does not hold shares carrying more than 50 per cent. of such voting rights, will be unable, without the Panel's consent, to acquire, either individually or together, any interest in any further voting rights in the company without being required to make a general offer to shareholders of that company to acquire their shares at the highest price paid by that person (or any persons acting in concert with them) for shares in the company within the preceding 12 months. Persons holding more than 50 per cent. of the voting rights of a company which is subject to the Takeover Code will normally have freedom to acquire further shares without being required to make a general offer to shareholders of that company.

The Company has obtained irrevocable undertakings from Harwood Capital, an existing substantial shareholder of the Company, to confirm that they will tender no less than their Basic Entitlement under the Tender Offer such that they will continue to hold less than 30 per cent. of the Company's issued share capital following completion of the Tender Offer and any potential subsequent purchase by the Company (pursuant to the Option Agreement) of Ordinary Shares acquired by Cavendish under the Tender Offer.

13.  Irrevocable undertakings and intentions of the Directors relating to the Tender Offer

The Company has received an irrevocable undertaking from Harwood Capital:

i.    vote in favour of the Resolutions; and

ii.    tender no less than their Basic Entitlement under the Tender Offer, representing approximately 26 per cent. of their beneficial holding of Ordinary Shares, and approximately 6.7 per cent. of the Issued Ordinary Share Capital as at the date of this document.

Further details of this irrevocable undertaking are set out in paragraph 3 of Part VII of this document.

14.  Related Party Transactions

The irrevocable undertakings from Harwood Capital to participate in the Tender Offer as set out in paragraph 13 above is considered a related-party transaction for the purposes of Rule 13 of the AIM Rules. The directors (excluding Christopher Mills by virtue of his association with Harwood Capital) consider, having consulted with Cavendish, the Company's Nominated Adviser, that the above participation by Harwood Capital in the Tender Offer is fair and reasonable in so far as Shareholders are concerned.

15.  Recommendations

The Board believes that the Capital Reduction and the Tender Offer are in the best interests of the Company and its Shareholders as a whole, and unanimously recommends that Shareholders vote in favour of the Resolutions as they intend to do in respect of their own holdings of Ordinary Shares representing, in aggregate, approximately 2.446 per cent. of the Issued Share Capital of the Company as at the Latest Practicable Date.

The Board is making no recommendation to individual Shareholders in relation to participation in the Tender Offer. Whether or not Shareholders decide to tender their Ordinary Shares will depend, amongst other things, on their own individual circumstances, including their own tax position. Shareholders are recommended to consult an appropriately authorised independent adviser in determining whether or not to participate in the Tender Offer and to the extent of such participation.

16.  Expected Timetable of Principal Events

All times are references to London times and are indicative only and may change. Each of the above times and dates is based on the Company's expectations as at the date of this Circular. If any of the above times and/or dates change, the revised times and/or dates will be notified to Shareholders by an announcement through a Regulatory Information Service.