This announcement contains inside information for the purposes of article 7 of the Market Abuse Regulation (EU) 596/2014 as it forms part of domestic law by virtue of the European Union (Withdrawal) Act 2018.

19 February 2024

ESKEN LIMITED
("Esken" or the "Company")

Update on LSA and Carlyle Global Infrastructure Fund

Further to the announcement issued on 5 February 2024, Esken, the aviation group, announces that the board of the Company's wholly owned subsidiary, London Southend Airport Company Limited ("LSA"), together with its advisors, has negotiated a recapitalisation proposal with Carlyle Global Infrastructure Fund ("CGI") which will be funded by CGI and Cyrus Capital Partners ("Cyrus") (the majority holder of the exchangeable bond) as a solution to the dispute in respect of the convertible loan between CGI and LSA.

In order for the recapitalisation proposal to proceed on a consensual basis, Esken and its wholly owned subsidiary Esken Aviation Limited ("EAL") (as the parent and intermediate holding company to LSA) would have to accede to this proposal by 4 March 2024. Esken, together with its advisors, is urgently reviewing and assessing the terms and potential financial impact of the recapitalisation proposal on the Company and its wider stakeholders and will then decide whether to accept the terms of the recapitalisation proposal.

The recapitalisation proposal includes a commitment by LSA to make an application to court for a restructuring plan under part 26A of the Companies Act 2006, absent Esken and EAL agreeing to the terms of the recapitalisation proposal. Esken understands that the terms of the proposed recapitalisation proposal, whether implemented via a restructuring plan or consensually, would amongst other things result in EAL's shareholding in LSA being significantly reduced to a minority interest. Funding of the proposal agreed with the board of LSA includes support from both CGI and Cyrus to secure the future of the airport.

A restructuring plan is a court process which can, if the court so decides and various other criteria are met, amongst other things cancel existing shareholdings and issue new shares to different parties so as to achieve a change in ownership of LSA. Esken is considering whether the terms of LSA's recapitalisation proposal are acceptable or whether it will contest LSA's restructuring plan through the courts.

The uncertainty that CGI's demand for repayment by LSA has created, has stalled any progress on (i) the disposal of non-core assets (ii) the potential £20 million funding facility from certain of Esken's larger shareholders into EAL and (iii) the amendment and extension of the exchangeable bond, all as referred to in previous announcements, until the position becomes clear.

In parallel with its assessment of the recapitalisation proposal for LSA, discussions are continuing with Cyrus, as majority holder of the exchangeable bond, to understand the impact of such recapitalisation proposal on the exchangeable bond and which may include a restructuring of Esken. These discussions include the provision of additional liquidity to Esken and its subsidiaries.

There can be no certainty that any of these discussions will lead to a consensual agreement, but Esken believes that a consensual outcome would be in the interests of all parties and will take all reasonable steps to facilitate such an outcome. The Company is also undertaking contingency planning, including exploring access to alternative funding to cover its liquidity needs. The recapitalisation proposal, if agreed to by the Company or imposed on it by the courts, could have a material adverse impact on the Group.

Enquiries:

Esken Limited c/o Teneo

Teneo

Olivia Peters

+44 7902 7701008

esken@teneo.com