TIDMAPG
RNS Number : 9881Q
Airsprung Group PLC
27 October 2011
NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION IN WHOLE OR IN
PART, IN, INTO OR FROM ANY JURISDICTION WHERE TO DO SO WOULD
CONSTITUTE A VIOLATION OF THE RELEVANT LAWS OF SUCH
JURISDICTION
27 October 2011
RECOMMENDED INCREASED CASH OFFER
for
Airsprung Group PLC ("Airsprung") by
Portnard Limited ("Portnard")
Summary
On 29 September 2011, Portnard announced the terms of a
mandatory cash offer for the issued and to be issued share capital
of Airsprung not already held by Portnard and parties acting in
concert with it. The Airsprung Directors are pleased to announce
that they have reached agreement with the Portnard Directors on the
terms of a recommended increased cash offer to be made by Portnard
for the issued and to be issued share capital of Airsprung not
already held by Portnard and parties acting in concert with it (the
"Increased Offer"). Airsprung and Portnard have sought, and the
Takeover Panel has agreed, to grant an extension to the date by
which the Offer Document in connection with the Increased Offer
must be posted. The Offer Document with the terms of the revised
mandatory cash offer will be posted by Thursday 10 November
2011.
Summary of the Increased Offer
-- Recommended cash offer of 31p for each Airsprung Share.
-- The Increased Offer values the entire issued and to be issued share capital of Airsprung at approximately GBP 7.9 million.
-- The Increased Offer represents a premium of approximately 55
per cent. to the Closing Price of 20 pence per Airsprung Share on
28 September 2011, being the last Business Day prior to the date of
the announcement of the mandatory cash offer.
-- The Increased Offer is conditional only on acceptances being
received which, taken together with Airsprung Shares acquired or
agreed to be acquired, will result in Portnard and parties acting
in concert with it holding more than 50 per cent. of the voting
rights in Airsprung.
-- At the date of this announcement, Portnard and parties acting
in concert with it are interested in 10,106,000 Airsprung Shares,
representing approximately 42.30 per cent. of the issued share
capital of Airsprung.
-- The Airsprung Directors have irrevocably undertaken to
Portnard to accept or procure acceptance of the Increased Offer in
respect of their entire aggregate holding of 6,247,658 Airsprung
Shares, representing approximately 26.2 per cent. of the existing
issued ordinary share capital of Airsprung. These undertakings
continue to be binding in the event of a higher competing offer for
Airsprung and will only cease to be binding in the event that the
Increased Offer lapses or is withdrawn
-- This announcement is being made by the Airsprung Directors
with the approval of the Portnard Directors pursuant to Note 3 to
Rule 2.5 of the Code.
-- The Airsprung Directors, who have been so advised by finnCap,
consider the terms of the Increased Offer to be fair and reasonable
and will unanimously recommend Airsprung Shareholders to accept the
Increased Offer. In providing advice to the Airsprung Directors,
finnCap has taken into account the Airsprung Directors' commercial
assessments. finnCap is providing the independent financial advice
for the purposes of Rule 3 of the Code.
-- Portnard is providing the cash consideration payable under
the Increased Offer from its existing cash resources. Merchant
Securities, financial adviser to Portnard, is satisfied that
sufficient resources are available to satisfy in full the cash
consideration payable to Airsprung Shareholders under the terms of
the Offer.
Key Financial Terms
-- The Increased Offer will be 31 pence in cash for each
Airsprung Share, valuing Airsprung's entire issued ordinary share
capital (fully diluted for the exercise of all outstanding
in-the-money options) at approximately GBP 7.9 million.
-- The Increased Offer represents a premium of approximately:
-- 55 per cent. to the Closing Price of 20 pence per Airsprung
Share on 28 September 2011, being the last Business Day prior to
the date of announcement of the mandatory cash offer;
-- 43 per cent. to the average Closing Price of 21.64 pence per
Airsprung Share for the month ended 28 September 2011, being the
last Business Day prior to the date of announcement of the
mandatory cash offer; and
-- 38 per cent. to the average Closing Price of 22.53 pence per
Airsprung Share for the 12 months ended 28 September 2011, being
the last Business Day prior to the date of announcement of the
mandatory cash offer.
Commenting on the Increased Offer, Stuart Lyons, Chairman of
Airsprung, said:
"The Airsprung Board believes that the Increased Offer being
made by Portnard represents a good opportunity for Airsprung's
shareholders to realise the full value of their shares in cash. As
a result of the assurances that the Board has received regarding
Portnard's future intentions for the Company, its employees,
pensioners and other stakeholders in the business, we are satisfied
that Portnard and its concert party will be suitable owners of the
Company."
Background to and reasons for recommending the Increased
Offer
The mandatory cash offer announced by Portnard on 29 September
2011 was made following a significant market purchase which
triggered the requirement to make a mandatory offer under Rule 9 of
the Code. This purchase was made without the prior knowledge of the
Airsprung Directors. Following announcement of the mandatory cash
offer, the Airsprung Directors have held meetings with the Portnard
Directors and demonstrated that the mandatory cash offer did not
reflect a fair value for the Company. The Airsprung Directors
believe that the Increased Offer is a fair valuation of Airsprung
based upon its recent trading, current position and prospects, and
market conditions.
The increased price of 31 pence per share is 14.8 per cent.
higher than the mandatory cash offer price of 27p and represents a
premium of 55 per cent. to the Closing Price of 20 pence of an
Airsprung Share on 28 September 2011, the Business Day immediately
preceding the date of announcement of the mandatory cash offer.
The Airsprung Directors have considered the likely impact of
both the Increased Offer and their response to it on the stability
of the Group's business, its ability to secure orders and the
continuity of employment. Portnard has provided assurances that it
will continue to operate the Airsprung Group as a trading business,
operated on a day to day basis by the existing senior management,
and that it has no specific plans to make any changes that would
give rise to material repercussions on the level and location of
employment within the Group. The assurances the Airsprung Directors
have received give the Airsprung Directors reasonable confidence
that Portnard will take a responsible view of the interests of the
employees and the maintenance of business relationships.
The Airsprung Directors have informed Portnard of the Group's
commitment towards the members of the Airsprung Retirement and
Death Benefits Scheme (the "Scheme"). The Airsprung Directors have
received assurances that Portnard has no intention of changing the
current relationship between the Group and the Trustees, and that
consultations will continue to take place on matters affecting the
Scheme.
Current trading and prospects of Airsprung
The Airsprung Directors regard Airsprung as a professionally
managed business, which has shown a degree of resilience during the
recent economic pressures, and believe that the prospects of
Airsprung as an independent company would be sound. However, the
Group operates in a cyclical sector, and sales and profitability
are affected by a number of factors outside management's control,
for example, the prices of raw materials, housing activity,
consumer spending, the level of VAT and the relative success of the
Group's retail customers. Sales and profits both fell in the year
to March 2011. At the recent AGM, the Airsprung Directors announced
a modest improvement in the outlook for the full year and, since
then, the Group has succeeded in winning significant new business.
Against that, the economic environment remains challenging, and
many retailers continue to find trading exceptionally difficult.
The effect of these factors has been reflected in the price of the
Group's shares, prior to the recent purchases by Portnard and
parties acting in concert with it. In considering the Increased
Offer, the Airsprung Directors have had regard to the current and
projected economic environment, and to the Group's past
performance, present trading and future prospects.
In assessing the Increased Offer, the Airsprung Directors have
also taken into account the strong asset backing enjoyed by the
Group, particularly in respect of the manufacturing site in
Trowbridge. Having consulted the local planning authority and taken
independent professional advice, the Airsprung Directors are of the
view that redevelopment for other than commercial, industrial and
employment purposes is not likely to be an option for the
foreseeable future.
Recommendation
The Airsprung Directors, who have been so advised by finnCap,
consider the terms of the Increased Offer to be fair and
reasonable, and will unanimously recommend Airsprung Shareholders
to accept the Increased Offer. The Airsprung Directors have
irrevocably undertaken to accept or procure acceptance of the
Increased Offer in respect of their entire holding of 6,247,658
Airsprung Shares, representing in aggregate approximately 26.2 per
cent. of the existing issued ordinary share capital of Airsprung.
These undertakings continue to be binding in the event of a higher
competing offer for Airsprung and will only cease to be binding in
the event that the Increased Offer lapses or is withdrawn. In
providing advice to the Airsprung Directors, finnCap has taken into
account the Airsprung Directors' commercial assessments.
Anticipated Timetable
Except with the approval of the Takeover Panel, Airsprung and
Portnard will post the Offer Document to Airsprung Shareholders
and, for information only, to holders of share options under the
Airsprung Share Options Schemes as soon as practicable and, in any
event, no later than 10 November 2011.
Publication on website
A copy of this announcement will be available, subject to
certain restrictions in relation to persons resident in Restricted
Jurisdictions, at Airsprung's website at
www.airsprung-group.co.uk.
A person may request a hard copy of the announcement and may
also request that all future documents, announcements and
information in relation to the Increased Offer are sent in hard
copy form. A hard copy may be obtained by sending a request to Tean
Dallaway, Airsprung Group PLC, Canal Road, Trowbridge, Wiltshire,
BA14 8RQ (telephone number 01225 754411).
General
This announcement is for information purposes only and is not
intended to and does not constitute or form part of any offer to
sell or any invitation to purchase or subscribe for any securities
pursuant to the Increased Offer or otherwise. The Increased Offer
will be made solely pursuant to the terms of the Offer Document
which will contain the full terms and condition of the Increased
Offer, including details of how the Increased Offer might be
accepted.
finnCap is acting as financial adviser and corporate broker to
Airsprung and no one else in connection with the matters set out in
this announcement and will not be responsible to anyone other than
Airsprung for providing the protections afforded to its clients nor
for providing advice in relation to the matters set out in this
announcement.
Merchant Securities is acting as financial adviser to Portnard
and no one else in connection with the matters set out in this
announcement and will not be responsible to anyone other than
Portnard for providing the protections afforded to its clients nor
for providing advice in relation to the matters set out in this
announcement.
Overseas Shareholders
The release, publication or distribution of this announcement in
certain jurisdictions may be restricted by law and therefore any
persons who are subject to the laws of any jurisdiction other than
the United Kingdom should inform themselves about, and observe any
applicable requirements.
This announcement has been prepared for the purpose of complying
with English law and the Code and the information disclosed may not
be the same as that which would have been disclosed if this
announcement had been prepared in accordance with the laws of
jurisdictions outside the United Kingdom.
Copies of this announcement and any formal documentation
relating to the Increased Offer are not being, and must not be,
directly or indirectly, mailed or otherwise forwarded, distributed
or sent in or into or from any Restricted Jurisdiction and persons
receiving such documents (including custodians, nominees and
trustees) must not mail or otherwise forward, distribute or send it
in or into or from any Restricted Jurisdiction. The Increased Offer
may not be made directly or indirectly, in or into, or by the use
of mails or any means or instrumentality (including, but not
limited to, facsimile, e-mail or other electronic transmission,
telex or telephone) of interstate or foreign commerce of, or of any
facility of a national, state or other securities exchange of any
Restricted Jurisdiction and the Increased Offer may not be capable
of acceptance by any such use, means, instrumentality or
facilities.
Rule 2.10 disclosure
In accordance with Rule 2.10 of the Code, Airsprung confirms
that it has 23,888,698 ordinary shares of ten pence each in issue
and admitted to trading on the AIM market of the London Stock
Exchange under the UK ISIN code GB0000119940.
Forward-Looking Statements
This document contains certain statements about Airsprung and
Portnard that are or may be "forward-looking statements" - that is,
statements related to future, not past, events, including
forward-looking statements. These statements are based on the
current expectations of the management of Airsprung and Portnard
(as the case may be) and are subject to uncertainty and changes in
circumstances, and involve risks and uncertainties that could cause
actual results to differ materially from those expressed or implied
in such forward-looking statements.
The forward-looking statements contained in this announcement
may include statements about the expected effects on Arudel and
Portnard of the Increased Offer, the expected timing and scope of
the Increased Offer and all other statements in this document other
than historical facts. Without limitation, any statements preceded
or followed by or that include the words "targets", "plans",
"believes", "expects", "aims", "intends", "will", "may",
"anticipates", "estimates", "should," "would," "expect,"
"positioned," "strategy," or words or terms of similar substance or
the negative thereof, are forward-looking statements.
Forward-looking statements include statements relating to the
following: (i) future capital expenditures, expenses, revenues,
earnings, synergies, economic performance, indebtedness, financial
condition, dividend policy, losses and future prospects; (ii)
business and management strategies and the expansion and growth of
Airsprung's or Portnard's operations and potential synergies
resulting from the Increased Offer; (iii) the effects of government
regulation on Airsprung's or Portnard's business, and (iv)
Airsprung's plans, objectives, expectations and intentions
generally.
There are a number of factors that could cause actual results
and developments to differ materially from those expressed or
implied by such forward-looking statements. Unknown or
unpredictable factors could also cause actual results to differ
materially from those in any forward-looking statement. Due to such
uncertainties and risks, readers are cautioned not to place undue
reliance on such forward-looking statements, which speak only as of
the date hereof. Neither Airsprung nor Portnard undertakes any
obligation to update publicly or revise forward-looking statements,
whether as a result of new information, future events or otherwise,
except to the extent legally required.
Enquiries:
finnCap Telephone: +44 (0) 20 7220 0500
(Financial adviser and
corporate broker to Airsprung)
Marc Young or Charlotte Stranner
Airsprung
Tony Lisanti, Chief Executive Telephone: 44 (0) 1225 754 411
Merchant Securities Limited Telephone: +44 (0) 20 7628 2200
(Financial adviser to Portnard)
David Worlidge or Virginia Bull
Disclosure Requirements under the Code
Under Rule 8.3(a) of the City Code, any person who is interested
in one per cent. or more of any class of relevant securities of an
offeree company or of any paper 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 paper
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 paper 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 paper offeror is first identified.
Relevant persons who deal in the relevant securities of the offeree
company or of a paper offeror prior to the deadline for making an
Opening Position Disclosure must instead make a Dealing
Disclosure.
Under Rule 8.3(b) of the City Code, any person who is, or
becomes, interested in 1 per cent. or more of any class of relevant
securities of the offeree company or of any paper offeror must make
a Dealing Disclosure if the person deals in any relevant securities
of the offeree company or of any paper 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 paper offeror, 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 paper
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. If you are in any doubt as to whether you are required
to make an Opening Position Disclosure or a Dealing Disclosure, you
should contact the Panel's Market Surveillance Unit on +44 (0)20
7638 0129.
Please note that, for the purposes of the above summary of Rule
8 of the Code, Portnard is not treated as a paper offeror and
therefore there is no requirement to disclose interests or dealings
in shares of Portnard under Rule 8 of the Code.
Definitions
The following definitions apply throughout this announcement
unless the context otherwise requires:
"Airsprung" or the "Company" Airsprung Group PLC, a company
or the "Group" registered in England and Wales
with registered number 01277785
whose registered office is Canal
Road, Trowbridge, Wiltshire BA14
8RQ;
"Airsprung Directors" the directors of Airsprung as
at the date of this announcement;
"Airsprung Shares" the existing unconditionally
allotted and issued and fully
paid ordinary shares of 10 pence
each in the capital of Airsprung
and any further ordinary shares
of 10 pence each in the capital
of Airsprung which are unconditionally
allotted and issued and fully
paid before the date on which
the Increased Offer closes or
before such earlier date as Portnard
(subject to the Code) may determine,
not being earlier than the date
on which the Increased Offer
becomes or is declared unconditional
as to acceptances;
"Airsprung Shareholders" the holders of Airsprung Shares;
"Business Day" a day (other than a Saturday,
a Sunday or public holiday) on
which banks are generally open
for business in the City of London
for the transaction of all normal
sterling banking business;
"Closing Price" the closing middle market quotation
of an Airsprung Share as derived
from the London Stock Exchange;
"Code" the City Code on Takeovers and
Mergers of the United Kingdom;
"finnCap" finnCap Limited, financial advisor
and corporate broker to Airsprung;
"Increased Offer" the Increased Offer to be made
by Portnard to acquire the entire
issued and to be issued Airsprung
Shares not already owned by Portnard
on the terms and conditions to
be set out in the Offer Document;
"Merchant Securities" Merchant Securities Limited,
financial adviser to Portnard;
"Offer Document" the document to be sent to Airsprung
Shareholders which will contain,
inter alia, the terms and condition
of the Increased Offer;
"Portnard" Portnard Limited, a company incorporated
in Jersey, with registered number
12672 whose registered office
is at 26 New Street, St Helier,
Jersey JE2 3RA
"Portnard Directors" the board of directors of Portnard
as at the date of this announcement;
"Restricted Jurisdiction" any jurisdiction where local
laws or regulations may result
in a significant risk of civil,
regulatory or criminal exposure
if information concerning the
Increased Offer is set or made
available to Airsprung Shareholders
in that jurisdiction;
"Takeover Panel" the Panel on Takeovers and Mergers
of the United Kingdom.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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