TIDMBAG TIDMBVIC
RNS Number : 0560R
Barr(A.G.) PLC
14 November 2012
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
For immediate release
14 November 2012
RECOMMENDED ALL-SHARE MERGER OF A.G. BARR P.L.C. AND BRITVIC
PLC
Summary
-- The boards of A.G. BARR p.l.c. and Britvic plc are pleased to
announce that they have reached agreement on the terms of a
recommended all-share merger of A.G. Barr and Britvic, which is to
be implemented by way of a scheme of arrangement of Britvic. It is
proposed that the Combined Entity will be called "Barr Britvic Soft
Drinks plc".
-- The Merger will create one of the leading soft drinks
companies in Europe, with annual sales of over GBP1.5 billion, a
portfolio of strong brands and significant prospects for future
growth.
-- The Merger ratio will be 0.816 New A.G. Barr Shares for every
Britvic Share held, resulting in Britvic Shareholders holding
approximately 63 per cent. and A.G. Barr Shareholders holding
approximately 37 per cent. of the issued share capital of the
Combined Entity as at the Effective Date.
-- The combination has compelling commercial and industrial
logic given the high level of complementarity between the two
businesses in terms of brands, sales channel presence and
geographic presence within the United Kingdom.
-- In addition, following preliminary analysis, opportunities
for significant cost and net revenue synergies have been identified
which underpin the industrial logic and shareholder value creation
opportunity of the Merger. The boards of A.G. Barr and Britvic
believe that the Combined Group will be able to achieve recurring
annual cost synergies of approximately GBP35 million through
overhead savings, procurement savings and supply chain
enhancements. In addition to these cost synergies, the boards of
A.G. Barr and Britvic believe that the Merger will provide an
opportunity to achieve a contribution of at least GBP5 million from
annual net revenue synergies through utilising the combined
distribution channels, brand portfolios and geographic presence of
the Combined Group. The boards of A.G. Barr and Britvic expect to
build up synergies progressively, minimising risk, in order to
achieve aggregate, full run rate synergies of GBP40 million in
2016(1) .
------------------------------------- (1) These statements are
not intended as a profit forecast and should not be interpreted to
mean that earnings per A.G. Barr or Britvic ordinary share for the
current or future financial years would necessarily match or exceed
the historical published earnings per A.G. Barr or Britvic ordinary
share.
-- The boards of A.G. Barr and Britvic believe that the Combined
Group will possess an attractive portfolio of strong and
differentiated brands (including IRN-BRU, Robinsons, Fruit Shoot,
J2O and Rubicon), with its portfolio well represented in key
sub-segments of the soft drinks market.
-- Britvic also enjoys a strong relationship with Pepsi and
Pepsi is supportive of a combination of A.G. Barr and Britvic.
Britvic has exclusive bottling and distribution agreements with
Pepsi in Great Britain for a number of Pepsi brands including
Pepsi, 7UP, Gatorade, Mountain Dew and SoBe, and for Pepsi, 7UP and
Mountain Dew in Ireland. The Combined Group is committed to
maintaining and developing its successful relationship with Pepsi.
Conditional on the Merger becoming Effective, Pepsi and Britvic
have agreed certain variations to the contractual terms of Pepsi's
exclusive bottling and distribution agreements with Britvic (to
reflect the operations of the Combined Group following the Merger)
and, on the basis of these revised terms, Pepsi has agreed not to
exercise any rights of termination it may have as a consequence of
the Merger under these agreements.
-- The Combined Group's brand portfolio will benefit from
enhanced routes to market and is expected to drive opportunities
for further revenue growth. Internationally, the Combined Group
will enjoy significant presence in France and Ireland, and growing
distribution of proprietary brands in markets such as the USA.
-- The Combined Group's strategy will focus on creating value by
driving both the availability of its brands and operational
efficiency.
-- The Combined Group will have a proven management team to be
led by the current A.G. Barr CEO, Roger White, as CEO of the
Combined Group, with John Gibney, the current CFO of Britvic, as
CFO of the Combined Group. Gerald Corbett, the current Britvic
non-executive Chairman, will become the non-executive Chairman of
the Combined Group, and Ronald Hanna, the current Chairman of A.G.
Barr, will become the non-executive Deputy Chairman of the Combined
Group. The Combined Entity's board will also include a further six
non-executive directors, three nominated from each of A.G. Barr's
and Britvic's boards. Furthermore, the Combined Group will benefit
from the collective talent of the respective management teams, who
will focus on delivering the Combined Group's business strategy
whilst delivering the integration of the two businesses.
-- A.G. Barr and Britvic are both experienced operators with
significant knowledge and expertise across the soft drinks sector.
Both A.G. Barr and Britvic have recent experience of successful
post transaction integrations. The integration of the two
businesses will be managed by a dedicated integration team,
bringing together the best relevant capability of both businesses,
to facilitate a smooth and swift transition.
-- Following the completion of the Merger, the Combined Group
will benefit from a robust long term capital structure. The
Combined Group's sources of funding will provide appropriate
financial and strategic flexibility going forward which will be
further enhanced by the delivery of synergies.
-- It is proposed that the legal headquarters of the Combined
Entity will be located at A.G. Barr's existing head office in
Cumbernauld which will also remain its registered office, and its
operational headquarters will be located at Britvic's existing head
office at Hemel Hempstead.
-- A.G. Barr and Britvic intend to pay dividends in respect of
the period up to the Effective Date. A.G. Barr intends to declare a
second interim dividend for the year ending 26 January 2013 of 7.4p
per share to be paid on 18 January 2013 to A.G. Barr Shareholders
on the register on 4 January 2013, in lieu of the final dividend
for the financial year ending 26 January 2013. Together with the
interim dividend of 2.6p per share paid to A.G. Barr Shareholders
on 19 October 2012, this gives a total dividend for the year ending
26 January 2013 of 10.0p per share, an increase of approximately
7.5 per cent. on the dividend paid for the year ended 28 January
2012.
-- Britvic intends to declare a second interim dividend in lieu
of the final dividend for the financial year ended 30 September
2012 of 12.4p per share. Together with the interim dividend of 5.3p
per share paid to Britvic Shareholders on 13 July 2012, this gives
a total dividend of 17.7p per share for the financial year ended 30
September 2012, consistent with the prior financial year. The
second interim dividend will be paid on 18 January 2013 to Britvic
Shareholders on the register on 7 December 2012. Additionally,
Britvic intends to declare a special interim dividend of 10.0p per
share, conditional upon the Merger becoming Effective, in lieu of
the dividend in relation to the period from 1 October 2012 until
the Effective Date, and in recognition of the Combined Group's
dividend policy. This will be paid after the Effective Date to
Britvic Shareholders on the register at the Scheme Record Time.
-- The Merger will be conditional on, amongst other things, the
approval of A.G. Barr Shareholders and Britvic Shareholders and OFT
clearance.
-- A.G. Barr and Britvic have received irrevocable undertakings
from those of the A.G. Barr Directors, their families and related
trusts, and Britvic Directors and their families who hold or are
beneficially entitled to A.G. Barr and/or Britvic shares,
representing in aggregate 19.94 per cent. of A.G. Barr's share
capital and 0.40 per cent. of Britvic's share capital respectively
in issue on 13 November 2012 (being the latest practicable date
prior to this announcement).
Gerald Corbett, Britvic plc non-executive Chairman
commented:
"The merger of A.G. Barr and Britvic will create a world class
soft drinks company. The combination makes huge commercial and
industrial sense, bringing together a host of iconic brands from
Robinsons Squash to IRN-BRU, as well as from the strong stable of
Pepsi beverage brands, with very little overlap. A.G. Barr and
Britvic are a fantastic fit with complementary strengths in
products, channels and geographies and we will benefit from very
significant synergies. Together we will create a bigger, better and
stronger business for our consumers, customers and shareholders for
now and the future."
Ronald Hanna, A.G. BARR p.l.c. non-executive Chairman
commented:
"This is a unique opportunity to create long term value for both
sets of shareholders through sustainable profitable growth,
underpinned by significant synergy benefits. The Combined Group
will have a broad portfolio of attractive soft drinks brands with
representation in key sub-segments of the soft drinks market. The
new business will enjoy significant growth potential in all sectors
of the market through diversified and enhanced routes to market and
the potential of increased international exposure. With a clear
strategy, strong management team and tight financial control, the
union of our two businesses will create real future potential."
The Britvic Directors, who have been so advised by Citigroup
Global Markets Limited, consider the terms of the Merger to be fair
and reasonable. In providing its advice, Citigroup Global Markets
Limited has taken into account the commercial assessments of the
Britvic Directors. Accordingly, the Britvic Directors intend
unanimously to recommend Britvic Shareholders to vote in favour of
the Scheme at the Court Meeting and the resolutions to be proposed
at the Britvic General Meeting, as the Britvic Directors who hold
or are beneficially entitled to Britvic Shares have irrevocably
undertaken to do in respect of their own Britvic Shares
representing, in aggregate, approximately 0.18 per cent. of
Britvic's share capital in issue on 13 November 2012 (being the
latest practicable date prior to this announcement).
The A.G. Barr Directors, who have been so advised by Rothschild,
consider the terms of the Merger to be fair and reasonable. In
providing its advice, Rothschild has taken into account the
commercial assessments of the A.G. Barr Directors. Accordingly, the
A.G. Barr Directors intend unanimously to recommend A.G. Barr
Shareholders to vote in favour of the resolution to be proposed at
the A.G. Barr General Meeting to approve the Merger and the related
resolutions, as the A.G. Barr Directors who hold or are
beneficially entitled to A.G. Barr Shares have irrevocably
undertaken to do in respect of their own A.G. Barr Shares
representing, in aggregate, approximately 5.3 per cent. of A.G.
Barr's share capital in issue on 13 November 2012 (being the latest
practicable date prior to this announcement).
The Scheme Document, containing further information about the
Merger and notices of the Court Meeting and the Britvic General
Meeting, will be posted to Britvic Shareholders as soon as
practicable and within 28 days of the date of this announcement. It
is expected that the Scheme will become effective in February 2013,
subject to the satisfaction or waiver of the Conditions and certain
further terms set out in Appendix 1 to this announcement.
It is expected that the A.G. Barr Prospectus, containing
information about the New A.G. Barr Shares and the Combined Group,
will be published at the same time as the Scheme Document is posted
to Britvic Shareholders.
It is expected that the A.G. Barr Circular, containing details
of the Merger and notice of the A.G. Barr General Meeting at which
resolutions will be proposed for the approval of the Merger by A.G.
Barr Shareholders, will be posted to A.G. Barr Shareholders at the
same time as the Scheme Document is posted to Britvic
Shareholders.
This summary should be read in conjunction with, and is subject
to, the full text of the following announcement (including its
Appendices). The Merger will be subject to the Conditions and
certain further terms set out in Appendix 1 and to the full terms
and conditions to be set out in the Scheme Document. Appendix 2
contains the sources and bases of certain information contained in
this summary and the following announcement. Appendix 3 contains
details of the irrevocable undertakings received by A.G. Barr and
Britvic. Appendix 4 contains the Britvic Profit Estimate and also
Ernst & Young LLP's and Citigroup Global Markets Limited's
reports on the Britvic Profit Estimate. Appendix 5 contains the
definitions of certain terms used in this summary and the following
announcement.
There will be an investor and analysts' presentation which will
start promptly at 9.30 a.m. (London time) today at the offices of
Rothschild, New Court, St Swithin's Lane, London EC4N 8AL. There
will be a live audio webcast of the investor and analysts'
presentation given today by Gerald Corbett (Chairman of Britvic
plc), Roger White (Chief Executive of A.G. BARR p.l.c.) and John
Gibney (Group Finance Director of Britvic plc).*
The webcast will be available at www.agbarr.co.uk and
http://ir.britvic.com.
Standard International Access Number +44 (0) 20 3003 2666
UK Toll Free 0808 109 0700
USA Toll Free 1 866 966 5335
Conference call PIN Code 8421587
*Please note that the live audio webcast and telephone access
may not be in sync.
Enquiries
A.G. BARR p.l.c.
Roger White +44 (0) 123 685 2400
Alex Short
Rothschild (financial adviser to A.G. Barr)
Akeel Sachak +44 (0) 207 280 5000
Stuart Vincent
Jessica Dale
Investec Bank plc (broker to A.G. Barr)
Keith Anderson +44 (0) 207 597 5970
David Anderson
Henry Reast
College Hill (PR adviser to A.G. Barr)
Justine Warren +44 (0) 207 457 2020
Matthew Smallwood
Britvic plc
Gerald Corbett +44 (0) 1442 284300
John Gibney
Rupen Shah
Steve Nightingale
Citigroup Global Markets Limited (joint financial adviser and
joint broker to Britvic)
David Wormsley +44 (0) 207 986 4000
Jan Skarbek
Andrew Seaton
Nomura International plc (joint financial adviser and joint
broker to Britvic)
Richard Snow +44(0) 207 521 2000
Nicholas Marren
Brunswick (PR adviser to Britvic)
Mike Smith +44(0) 207 404 5959
Nick Cosgrove
Further information
This announcement is for information purposes only. It is not
intended to and does not constitute, or form part of, an offer,
invitation or the solicitation of an offer to purchase, otherwise
acquire, subscribe for, sell or otherwise dispose of any
securities, or the solicitation of any vote or approval in any
jurisdiction, pursuant to the Merger or otherwise nor shall there
be any sale, issuance or transfer of securities in any jurisdiction
in contravention of applicable law. The Merger will be made solely
by means of the Scheme Document which, together with the Forms of
Proxy, will contain the full terms and conditions of the Merger
including details of how to vote in respect of the Merger.
Britvic will prepare the Scheme Document to be distributed to
Britvic Shareholders and A.G. Barr will prepare the A.G. Barr
Circular to be distributed to A.G. Barr Shareholders. A.G. Barr
will also publish the A.G. Barr Prospectus containing information
about the New A.G. Barr Shares and the Combined Group. Britvic
urges Britvic Shareholders to read the Scheme Document and the A.G.
Barr Prospectus when they become available because they will
contain important information in relation to the Merger, the New
A.G. Barr Shares and the Combined Group. A.G. Barr urges A.G. Barr
Shareholders to read the A.G. Barr Circular and the A.G. Barr
Prospectus when they become available because they will contain
important information in relation to the Merger, the New A.G. Barr
Shares and the Combined Group. Any vote in respect of the Scheme or
other response in relation to the Merger should be made only on the
basis of the information contained in the Scheme Document and the
A.G. Barr Prospectus, or the A.G. Barr Circular and the A.G. Barr
Prospectus, as appropriate.
This announcement does not constitute a prospectus or prospectus
equivalent document.
Please be aware that addresses, electronic addresses and certain
other information provided by Britvic Shareholders, persons with
information rights and other relevant persons for the receipt of
communications from Britvic may be provided to A.G. Barr during the
offer period as required under Section 4 of Appendix 4 of the
Code.
Rothschild, which is authorised and regulated in the United
Kingdom by the FSA, is acting exclusively for A.G. Barr and for
no-one else in connection with the matters set out in this
announcement and will not be responsible to anyone other than A.G.
Barr for providing the protections afforded to its clients or for
providing advice in connection with the matters set out in this
announcement.
Investec Bank plc, which is authorised and regulated in the
United Kingdom by the FSA, is acting as corporate broker to A.G.
Barr and for no-one else in connection with the matters set out in
this announcement and will not be responsible to anyone other than
A.G. Barr for providing the protections afforded to its clients or
for providing advice in connection with the matters set out in this
announcement.
Citigroup Global Markets Limited, which is authorised and
regulated in the United Kingdom by the FSA, is acting exclusively
for Britvic and for no-one else in connection with the matters set
out in this announcement and will not be responsible to anyone
other than Britvic for providing the protections afforded to its
clients or for providing advice in connection with the matters set
out in this announcement.
Nomura International plc, which conducts its UK investment
banking business as Nomura, is authorised and regulated in the
United Kingdom by the FSA and is acting as joint broker and joint
financial adviser to Britvic and for no-one else in connection with
the matters set out in this announcement. Nomura will not be
responsible to anyone other than Britvic for providing the
protection afforded to its clients or for providing advice in
connection with the matters set out in this announcement.
Notice to US holders of Britvic Shares
The Merger will involve an exchange of the securities of an
English company for the securities of a Scottish company and will
be subject to UK disclosure requirements, which are different from
those of the United States. The financial information included in
this announcement has been prepared in accordance with IFRS and
thus may not be comparable to financial information of US companies
or companies whose financial statements are prepared in accordance
with generally accepted accounting principles in the United
States.
The Merger will be made by means of a scheme of arrangement
under the Companies Act and otherwise in accordance with the
requirements of the Code. The scheme of arrangement will relate to
the shares of an English company that is not registered under the
US Exchange Act.
Accordingly, the proposed combination will be subject to
disclosure and other procedural requirements applicable in the UK
to schemes of arrangement, which differ from the disclosure
requirements of the US proxy and tender offer rules under the US
Exchange Act.
Any securities to be issued under the Merger have not been and
will not be registered under the US Securities Act, or under the
securities laws of any state, district or other jurisdiction of the
United States, or of Australia, Canada or Japan. Accordingly such
securities may not be offered, sold or delivered, directly or
indirectly, in or into such jurisdictions except pursuant to
exemptions from, or transactions not subject to, applicable
requirements of such jurisdictions. It is expected that the New
A.G. Barr Shares will be issued in reliance upon the exemption from
such registration provided by Section 3(a)(10) of the US Securities
Act. Under applicable US securities laws, persons (whether or not
US persons) who are or will be "affiliates" (within the meaning of
the US Securities Act) of Britvic or A.G. Barr prior to, or of the
Combined Entity after, the Effective Date will be subject to
certain transfer restrictions relating to the New A.G. Barr Shares
received in connection with the Merger.
It may be difficult for US holders of Britvic Shares to enforce
their rights and any claim arising out of the US federal securities
laws, since A.G. Barr and Britvic are incorporated and located in
non-US jurisdictions, and some or all of their officers and
directors may be residents of a non-US jurisdiction. US holders of
Britvic Shares may not be able to sue a non-US company or its
officers or directors in a non-US court for violations of the US
securities laws. Further, it may be difficult to compel a non-US
company and its affiliates to subject themselves to a US court's
judgment.
If A.G. Barr exercises its right, subject to the consent of the
Panel, to implement the Merger by way of a Merger Offer, the Merger
will be made in compliance with applicable US laws and regulations,
including applicable provisions of the tender offer rules under the
US Exchange Act, to the extent applicable.
Overseas jurisdictions
The availability of New A.G. Barr Shares under the Merger to
Britvic Shareholders who are not resident in the UK may be affected
by the laws of the relevant jurisdictions in which they are
located. Persons who are not resident in the UK should inform
themselves of, and observe, any applicable legal or regulatory
requirements of their jurisdictions.
The release, publication or distribution of this announcement in
or into jurisdictions other than the UK may be restricted by law
and therefore any persons who are subject to the law of any
jurisdiction other than the UK should inform themselves about, and
observe, any applicable requirements. Any failure to comply with
the applicable restrictions may constitute a violation of the
securities laws of any such jurisdiction. To the fullest extent
permitted by applicable law, the companies and persons involved in
the Merger disclaim any responsibility or liability for the
violation of such restrictions by any person.
This announcement has been prepared for the purposes of
complying with English and Scots law, the Listing Rules, the rules
of the London Stock Exchange 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 of the UK.
Unless otherwise determined by A.G. Barr and Britvic or required
by the Code, and permitted by applicable law and regulation, the
Merger will not be made, directly or indirectly, in, into or from
any Restricted Jurisdiction where to do so would violate the laws
in that jurisdiction and no person may vote in favour of the Merger
by any such use, means, instrumentality or from within a Restricted
Jurisdiction. Accordingly, copies of this announcement and formal
documentation relating to the Merger will not be and must not be,
directly or indirectly, mailed or otherwise forwarded, distributed
or sent in, into or from any Restricted Jurisdiction where to do so
would violate the laws of that jurisdiction and persons receiving
this announcement and all documents relating to the Merger
(including custodians, nominees and trustees) must not mail or
otherwise distribute or send them in, into or from such
jurisdictions where to do so would violate the laws in that
jurisdiction.
Forward-looking statements
This announcement contains statements which are, or may be
deemed to be, "forward-looking statements" which are prospective in
nature. All statements other than statements of historical fact are
forward-looking statements. They are based on current expectations
and projections about future events, and are therefore subject to
risks and uncertainties which could cause actual results to differ
materially from the future results expressed or implied by the
forward-looking statements. Often, but not always, forward-looking
statements can be identified by the use of forward-looking words
such as "plans", "expects", "is expected", "is subject to",
"budget", "scheduled", "estimates", "forecasts", "intends",
"anticipates", "believes", "targets", "aims", "projects" or words
or terms of similar substance or the negative thereof, as well as
variations of such words and phrases or statements that certain
actions, events or results "may", "could", "should", "would",
"might" or "will" be taken, occur or be achieved. Such statements
are qualified in their entirety by the inherent risks and
uncertainties surrounding future expectations. 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 A.G. Barr's or Britvic's
operations and potential synergies resulting from the Merger; and
(iii) the effects of global economic conditions on A.G. Barr's or
Britvic's business.
Such forward-looking statements involve known and unknown risks
and uncertainties that could significantly affect expected results
and are based on certain key assumptions. Many factors may cause
the actual results, performance or achievements of A.G. Barr,
Britvic or the Combined Group to be materially different from any
future results, performance or achievements expressed or implied by
the forward-looking statements. Important factors that could cause
actual results, performance or achievements of A.G. Barr, Britvic
or the Combined Group to differ materially from the expectations of
A.G. Barr, Britvic or the Combined Group, as applicable, include,
among other things, general business and economic conditions
globally, industry trends, competition, changes in government and
other regulations, including in relation to the environment, health
and safety and taxation, labour relations and work stoppages,
changes in political and economic stability, disruptions in
business operations due to reorganisation activities (whether or
not A.G. Barr combines with Britvic), interest rate and currency
fluctuations, the failure to satisfy any conditions for the Merger
(including approvals or clearances from regulatory and other
agencies and bodies) on a timely basis or at all, the inability of
the Combined Group to realise successfully any anticipated synergy
benefits when the Merger is implemented, the inability of the
Combined Group to integrate successfully A.G. Barr's and Britvic's
operations and programmes when the Merger is implemented, or the
Combined Group incurring and/or experiencing unanticipated costs
and/or delays or difficulties relating to the Merger when the
Merger is implemented. Such forward-looking statements should
therefore be construed in light of such factors.
Neither A.G. Barr nor Britvic, nor any of their respective
associates or directors, officers or advisers, provides any
representation, assurance or guarantee that the occurrence of the
events expressed or implied in any forward-looking statements in
this announcement will actually occur. You are cautioned not to
place undue reliance on these forward-looking statements, which
speak only as of the date hereof.
Other than in accordance with its legal or regulatory
obligations (including under the Listing Rules and the Disclosure
and Transparency Rules of the FSA), neither A.G. Barr nor Britvic
is under any obligation and A.G. Barr and Britvic each expressly
disclaim any intention or obligation to update or revise any
forward-looking statements, whether as a result of new information,
future events or otherwise.
No profit forecasts or estimates
Other than the Britvic Profit Estimate, no statement in this
announcement is intended as a profit forecast or estimate for any
period and no statement in this announcement should be interpreted
to mean that earnings or earnings per ordinary share for A.G. Barr
or Britvic, as appropriate, for the current or future financial
years would necessarily match or exceed the historical published
earnings or earnings per ordinary share for A.G. Barr or Britvic,
as appropriate.
The Britvic Profit Estimate is a profit forecast for the
purposes of Rule 28 of the Code. As such it is a requirement under
the Code that the Britvic Profit Estimate be reported on by
Britvic's reporting accountants and financial advisers. The bases
behind the Britvic Profit Estimate and the reports of Ernst &
Young LLP and Citigroup Global Markets Limited are set out in
Appendix 4 to this announcement. Ernst & Young LLP and
Citigroup Global Markets Limited have given and not withdrawn their
consent to the publication of their reports in the form and context
in which they are included.
Britvic Directors' responsibility statement
The Britvic Directors accept sole responsibility for the Britvic
Profit Estimate.
Disclosure requirements of the Code
Under Rule 8.3(a) of the Code, any person who is interested in 1
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 p.m. (London time) on the 10th business day following the
commencement of the offer period and, if appropriate, by no later
than 3.30 p.m. (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 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 p.m. (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 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.
You should contact the Panel's Market Surveillance Unit on +44 (0)
20 7638 0129 if you are in any doubt as to whether you are required
to make an Opening Position Disclosure or a Dealing Disclosure.
Rule 2.10 disclosure
In accordance with Rule 2.10 of the Code, A.G. Barr confirms
that, as at the date of this announcement, it has 116,768,778
ordinary shares of 4 (1) /(6) pence each in issue with ISIN
GB00B6XZKY75 and Britvic confirms that, as at the date of this
announcement, it has 242,344,551 ordinary shares of 20 pence each
in issue with ISIN GB00B0N8QD54.
Britvic has a Level 1 American Depositary Receipt programme,
under which ordinary shares of 20 pence each are traded in the form
of American Depositary Shares on the OTCQX market. The ordinary
shares of 20 pence each traded in the form of American Depositary
Shares with ISIN number US1111901047, on a ratio of one ordinary
share to two American Depositary Shares, are included within the
total set out above.
Publication on website
A copy of this announcement will be available free of charge,
subject to certain restrictions relating to persons resident in
Restricted Jurisdictions, on A.G. Barr's website at
www.agbarr.co.uk and on Britvic's website at http://ir.britvic.com
by no later than noon (London time) on the day following this
announcement. For the avoidance of doubt, the contents of those
websites are not incorporated into and do not form part of this
announcement.
You may request a hard copy of this announcement, free of
charge, by contacting the Company Secretary of A.G. Barr at
companysecretarialdepartment@agbarr.co.uk (or on +44(0)1236 852400)
or by writing to A.G. BARR p.l.c., Westfield House, 4 Mollins Road,
Cumbernauld, G68 9HD, or by contacting the Company Secretary of
Britvic at company.secretariat@britvic.co.uk (or on +44(0)1442
284411) or by writing to Britvic plc, Breakspear Park, Breakspear
Way, Hemel Hempstead, HP2 4TZ.
You may also request that all future documents, announcements
and information to be sent to you in relation to the Merger should
be in hard copy form.
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
14 November 2012
RECOMMENDED ALL-SHARE MERGER OF A.G. BARR P.L.C. AND BRITVIC
PLC
The boards of A.G. BARR p.l.c. and Britvic plc are pleased to
announce that they have reached agreement on the terms of a
recommended all-share merger of A.G. Barr and Britvic. The terms of
the Merger will provide holders of Britvic Shares with 0.816 New
A.G. Barr Shares for each Britvic Share held. It is proposed that
the Merger will be effected by way of a Court-sanctioned scheme of
arrangement of Britvic under Part 26 of the Companies Act, pursuant
to which A.G. Barr will acquire the entire issued and to be issued
ordinary share capital of Britvic. It is proposed that the Combined
Entity will be called "Barr Britvic Soft Drinks plc".
1. The Merger
Under the terms of the Merger, which will be subject to the
Conditions and further terms set out in Appendix 1 to this
announcement and to be set out in the Scheme Document, if the
Scheme becomes effective, Britvic Shareholders will receive:
for each Britvic Share 0.816 New A.G. Barr Shares
On the basis of A.G. Barr's closing share price of 432.2 pence
on 13 November 2012 (being the latest practicable date prior to
this announcement), the Merger values each Britvic Share at 352.7
pence and the entire issued share capital of Britvic at
approximately GBP855 million.
Britvic Shareholders will hold approximately 63 per cent. and
A.G. Barr Shareholders will hold approximately 37 per cent. of the
issued share capital of the Combined Entity as at the Effective
Date.
2. Recommendation
The Britvic Directors, who have been so advised by Citigroup
Global Markets Limited, consider the terms of the Merger to be fair
and reasonable. In providing its advice, Citigroup Global Markets
Limited has taken into account the commercial assessments of the
Britvic Directors. Accordingly, the Britvic Directors intend
unanimously to recommend Britvic Shareholders to vote in favour of
the Scheme at the Court Meeting and the Special Resolution to be
proposed at the Britvic General Meeting, as the Britvic Directors
who hold or are beneficially entitled to Britvic Shares have
irrevocably undertaken to do in respect of their own Britvic
Shares, representing in aggregate approximately 0.18 per cent. of
Britvic's share capital in issue on 13 November 2012 (being the
latest practicable date prior to this announcement).
The A.G. Barr Directors, who have been so advised by Rothschild,
consider the terms of the Merger to be fair and reasonable. In
providing its advice, Rothschild has taken into account the
commercial assessments of the A.G. Barr Directors. Accordingly, the
A.G. Barr Directors intend unanimously to recommend A.G. Barr
Shareholders to vote in favour of the resolution to be proposed at
the A.G. Barr General Meeting to approve the Merger and the related
resolutions, as the A.G. Barr Directors who hold or are
beneficially entitled to A.G. Barr Shares have irrevocably
undertaken to do in respect of their own A.G. Barr Shares,
representing in aggregate approximately 5.3 per cent. of A.G.
Barr's share capital in issue on 13 November 2012 (being the latest
practicable date prior to this announcement).
3. Background to and reasons for the Merger
The Merger will create one of the leading soft drinks companies
in Europe, with annual sales of over GBP1.5 billion, a portfolio of
strong brands and significant prospects for future growth. The
combination has compelling commercial and industrial logic given
the high level of complementarity between the two businesses in
terms of brands, sales channel presence and geographic presence
within the United Kingdom.
The boards of A.G. Barr and Britvic believe that the Combined
Group will be a stronger soft drinks platform than each of the two
companies separately and, therefore, the Merger is an opportunity
for both companies and their respective shareholders to benefit
from the resulting improvement in the Combined Group's ability to
compete successfully in the long term. Underpinning the commercial
and industrial logic is the potential to achieve significant
synergies. The Combined Group will also benefit from the collective
talent of the respective management teams who will seek to ensure
the successful integration of the two businesses and focus on
delivering the business strategy for the Combined Group.
Attractive portfolio of strong and differentiated brands
provides platform for growth
The boards of A.G. Barr and Britvic believe that the Combined
Group will possess an attractive portfolio of strong and
differentiated brands. The Combined Group's brand portfolio will be
well represented in key sub-segments of the soft drinks market.
Britvic's portfolio of owned international brands, such as
Robinsons, Robinsons Fruit Shoot and Teisseire, alongside strong
national brands such as J2O, Tango, juicy drench, Britvic, R
Whites, Fruité, Moulin de Valdonne, Ballygowan, Club and MiWadi,
will be combined with A.G. Barr's brands and complementary
portfolio, including its unique brand IRN-BRU, and its Rubicon, KA,
Barr and Strathmore brands.
Britvic enjoys a strong relationship with Pepsi and Pepsi is
supportive of a combination of A.G. Barr and Britvic. Britvic has
exclusive bottling and distribution agreements with Pepsi in Great
Britain for a number of Pepsi brands including Pepsi, 7UP,
Gatorade, Mountain Dew and SoBe, and for Pepsi, 7UP and Mountain
Dew in Ireland. The Combined Group is committed to maintaining and
developing its successful relationship with Pepsi. Conditional on
the Merger becoming Effective, Pepsi and Britvic have agreed
certain variations to the contractual terms of Pepsi's exclusive
bottling and distribution agreements with Britvic (to reflect the
operations of the Combined Group following the Merger) and, on the
basis of these revised terms, Pepsi has agreed not to exercise any
rights of termination it may have as a consequence of the Merger
under these agreements. Citigroup Global Markets Limited considers
these arrangements fair and reasonable.
The Combined Group's franchised brand portfolio is further
complemented by A.G. Barr's licensed brands including Orangina and
Rockstar and by Britvic's exclusive agreement with Pepsi Lipton
International Limited for Lipton Ice Tea. These agreements provide
further important brands to the portfolio of the Combined
Group.
The complementary nature of the respective brands of A.G. Barr
and Britvic will enable the Combined Group to offer consumers a
wider choice of products and brands and to cater for a broader set
of preferences and purchasing occasions. As such, the boards of
A.G. Barr and Britvic believe that the Combined Group can become a
more attractive supplier to its customers across all channels which
will create benefits in terms of enhanced brand representation.
The Merger will also bring together significant expertise in
soft drinks innovation, as demonstrated by the respective track
records of both A.G. Barr and Britvic of successful new product
launches, new flavour introductions, new packaging formats and
enhancements alongside innovative and differentiated marketing
campaigns.
The Combined Group expects to continue to invest significantly
in its brand portfolio, both owned and franchised/licensed,
building brand equity for the long term for the benefit of
consumers, customers, brand partners and shareholders.
Complementary channel and geographic presence
Based on the complementary channel and geographic presence of
A.G. Barr and Britvic, the Combined Group will be well positioned
to extend its offering to both customers and consumers.
The Combined Group will be able to utilise its enhanced sales
and distribution network and, in particular, Britvic's focus on the
national grocery chains and its contracts with licensed on-trade
outlets as well as A.G. Barr's Direct Store Delivery model that
supplies small retail convenience stores.
The Combined Group's brand portfolio will benefit from enhanced
routes to market and is expected to drive opportunities for further
revenue growth. Internationally, the Combined Group will enjoy
significant presence in France and Ireland, and growing
distribution of proprietary brands in markets such as the USA,
Australia, Netherlands and Russia.
Financial strength
Following the completion of the Merger, the Combined Group will
have a robust long term capital structure further underpinned by
the prospects for delivery of synergies and organic cash
generation.
Necessary approvals have been obtained to keep in place all of
Britvic's existing committed sources of financing, including
Britvic's GBP400 million revolving credit bank facility (which
matures in 2016) and Britvic's GBP491 million US private placement
notes (which mature between 2014 and 2022), providing a strong
capital base for the Combined Group.
The Combined Group's sources of funding will provide appropriate
financial and strategic flexibility going forward and enable it to
maintain levels of strategic investment in marketing, innovation
and capital expenditure and provide flexibility for organic growth
initiatives and potential future acquisition opportunities.
4. Synergies and integration
Following preliminary analysis undertaken by the boards of A.G.
Barr and Britvic, opportunities for significant cost and net
revenue synergies have been identified which underpin the
industrial logic and shareholder value creation opportunity of the
Merger. The boards of A.G. Barr and Britvic believe that the
Combined Group will be able to achieve recurring annual cost
synergies of approximately GBP35 million and the Merger will
provide an opportunity to achieve a contribution of at least GBP5
million from annual net revenue synergies. The boards of A.G. Barr
and Britvic expect to build up synergies progressively, minimising
risk, in order to achieve aggregate, full run rate synergies of
GBP40 million in 2016(2) .
-------------------------------------- (2) These statements are
not intended as a profit forecast and should not be interpreted to
mean that earnings per A.G. Barr or Britvic ordinary share for the
current or future financial years would necessarily match or exceed
the historical published earnings per A.G. Barr or Britvic ordinary
share.
Overhead cost savings are expected to arise from the elimination
of corporate overheads where there is duplication. There are
expected also to be savings on procurement costs coming from
greater scale in direct procurement of key overlapping raw
materials, as well as in indirect procurement such as media, trade
marketing and third party external production.
The Merger offers the opportunity to optimise the combined
operational footprint, increasing manufacturing capacity
utilisation and thereby enabling better leverage of fixed
production costs. It is expected that the Combined Group will be
able to benefit from a reconfigurationof the supply chain. In
particular, it is likely that the new facility that A.G. Barr is in
the process of constructing in Milton Keynes will provide
additional capacity which will offer greater flexibility for the
Combined Group.
The boards of A.G. Barr and Britvic expect GBP3 million of
savings will be realised in the first 12 months after completion of
the Merger, rising to approximately GBP16 million in the second
year after completion of the Merger and approximately GBP30 million
in the third year after completion of the Merger, with the full run
rate synergies of GBP40 million being realised in 2016(3) .
------------------------------------- (3) These statements are
not intended as a profit forecast and should not be interpreted to
mean that earnings per A.G. Barr or Britvic ordinary share for the
current or future financial years would necessarily match or exceed
the historical published earnings per A.G. Barr or Britvic ordinary
share.
It is expected that realisation of these synergies will result
in one-off exceptional costs of approximately GBP40 million, of
which GBP11 million would be incurred in the first 12 months after
completion of the Merger and approximately GBP29 million in the
second year after completion of the Merger. It is also expected
that to achieve the synergies, capital expenditure of approximately
GBP8 million will be incurred in the first 12 months after
completion of the Merger. In addition, there may be a requirement
for a non-cash write off of certain assets following the review of
the combined operational footprint but as yet these have not been
identified.
In addition to these cost synergies, the boards of A.G. Barr and
Britvic believe that the Merger will provide an opportunity to
achieve revenue synergies through utilising the combined
distribution channels, brand portfolios and geographic presence of
the Combined Group.
Alex Short (A.G. Barr CFO) will be appointed as Integration
Director and will oversee the integration process. It is envisaged
that the Combined Group will establish a full integration team,
bringing together the best relevant capability of both businesses,
to ensure that the synergies of the Merger are maximised. The
boards are confident that the integration of A.G. Barr and Britvic
can be achieved without undue disruption to the underlying
operations of each business.
As at the date of this announcement, an outline integration plan
is being developed. The output of that plan will be an agreed
definition of integration scope, quantified objectives, proposed
organisation structures and processes to be reviewed and
subsequently implemented, together with an overall integration
programme and stakeholder communication timetable.
As soon as practicable following the Effective Date, the
Combined Group will aim to have fully validated its initial synergy
assumptions, agreed the target operating model of the Combined
Group and completed a detailed integration plan across the Combined
Group's business. A.G. Barr and Britvic also aim to have completed
the principal elements of the restructuring of the Combined Group
which will include all senior management appointments, reporting
structures and operational and executive authority limits, and
changes to key Combined Group policies and processes. The latter
will include financial reporting, planning and budgetary processes,
compensation, treasury and liquidity management policies,
sustainability practices, and reviewing the scope of internal audit
and risk registers.
5. Information relating to A.G. Barr
A.G. Barr is one of the leading soft drinks businesses in the
UK. Established in 1875, A.G. Barr has been in the business of
producing, marketing and selling soft drinks for over 100 years,
primarily in the UK but with a growing level of international
sales. A.G. Barr has developed a balanced portfolio of proprietary
carbonated and still brands, including IRN-BRU, Barr range,
Rubicon, KA, Barr's Originals, Strathmore, Tizer, D'N'B, St
Clements, Simply, Sun Exotic and Findlays. A.G. Barr is also the
franchisee of the Orangina Schweppes Group in the UK, where A.G.
Barr manufactures and sells Orangina products under licence. A.G.
Barr also has a franchise arrangement with Rockstar, Inc. to sell
and distribute Rockstar energy drinks throughout the UK and
Ireland. The A.G. Barr Group employs approximately 980 people.
For the 52 weeks ended 28 January 2012 A.G. Barr's revenue was
GBP237 million (2011: GBP222 million) and it made a profit before
tax of GBP35 million (2011: GBP30 million). For the six months
ended 28 July 2012, A.G. Barr's revenue was GBP130 million (2011:
GBP124 million) and it made profit before tax of GBP15 million
(2011: GBP16 million).
A.G. Barr Shares are traded on the London Stock Exchange and the
company is a member of the FTSE 250 index.
Current trading
On 24 September 2012 A.G. Barr announced that:
"We expect trading to remain challenging over the coming months
and we have put in place cost control measures and a robust trading
programme for the balance of our financial year. Assuming there is
no further deterioration in the market, we remain confident about
our prospects."
Since 24 September 2012 A.G. Barr's trading has progressed in
line with its expectations.
6. Information relating to Britvic
Britvic is one of Europe's leading soft drinks companies, with a
broad portfolio of market leading brands such as Robinsons, J2O,
Fruit Shoot, R Whites, Britvic, Purdeys, juicy drench, drench,
Pennine Spring and Tango in GB, MiWadi, Club, Cidona and Ballygowan
in Ireland, and Teisseire, Moulin de Valdonne, Fruité and Pressade
in France. Britvic also has exclusive bottling agreements with
Pepsi in the UK and Ireland to manufacture and distribute global
brands such as Pepsi, Pepsi Max, 7UP and Mountain Dew. Collectively
Britvic employs approximately 3,300 people.
The Britvic Group's revenue for the 52 week financial year ended
2 October 2011 was GBP1,290 million and it had an operating profit
pre-exceptional and other items of GBP135 million, with profit
before tax pre-exceptional and other items of GBP105 million. For
the 28 weeks ended 15 April 2012, Britvic's revenue was GBP641
million (2011: GBP633 million) and it made profit before tax of
GBP25 million (2011: GBP28 million). As at 15 April 2012, the
Britvic Group had gross assets of GBP1,038 million.
Britvic Shares are traded on the London Stock Exchange and the
company is a member of the FTSE 250 index.
Current trading
On 18 October 2012, Britvic announced its 52 Week (full year)
Trading Update to 30 September 2012 including the following
statement:
"Following the Fruit Shoot recall in July, we have been focused
on returning supply to normalised levels. Concurrently, we have
been driving an improving performance from the strong brands across
the group. A further key brand priority has been to ensure that we
build and realise the value of our emerging US Fruit Shoot
business. We continue to place a strong emphasis on cash generation
and rigorous cost management across the group. The Board is
confident of delivering its expectations for the full year."
Since 18 October 2012 Britvic's trading has progressed in line
with its expectations.
7. Strategy of the Combined Group
Following the Merger, the Combined Group will aim to deliver
strong revenue and profit growth supported by attractive cash
returns. The boards of A.G. Barr and Britvic believe that the
breadth and balance of the Combined Group's portfolio of brands,
its longstanding customer relationships and its operational scale
will provide a strong platform for growth in the soft drinks
markets in which the Combined Group operates. In addition, its
consumer insight, proven innovation and brand development expertise
means that the Combined Group will be well positioned to identify
and capitalise on consumer and customer trends, underpinning its
growth potential.
The Combined Group's strategy will focus on creating value by
driving both the availability of its brands and operational
efficiency. The Combined Group will seek to:
-- grow and develop its core brands;
-- deliver sustainable profitable growth in its established
markets and internationally through franchised brands;
-- energise and enable its people in a performance driven culture; and
-- act responsibly, building the respect and the trust of all its stakeholders.
The Combined Group has also identified immediate business
priorities, which provide a focus on integration, delivery of the
synergies and business optimisation whilst also growing underlying
business performance. With a stronger balance sheet, the Combined
Group will be better positioned to pursue joint ventures and
acquisitions over the medium term.
8. Management, employees and locations of business
It is proposed that the board of the Combined Entity will be
reconstituted immediately following the Merger becoming Effective
so as to comprise ten directors, including eight non-executive
directors. As from the Effective Date, Gerald Corbett (Britvic)
will be non-executive Chairman, Ronald Hanna (A.G. Barr) will be
non-executive Deputy Chairman and Senior Independent Director, and
Robin Barr (A.G. Barr), Martin Griffiths (A.G. Barr), John Nicolson
(A.G. Barr), Joanne Averiss (Britvic), Bob Ivell (Britvic) and Ben
Gordon (Britvic) will be non-executive directors. The executive
directors will comprise Roger White (A.G. Barr) as Chief Executive
Officer and John Gibney (Britvic) as Chief Financial Officer.
Alex Short, Jonathan Kemp and Andrew Memmott will step down from
the board of A.G. Barr upon the Scheme becoming effective. Each of
the A.G. Barr Directors stepping down from the board of A.G. Barr
is fully supportive of the rationale for the Merger and of its
terms and conditions.
Paul Moody and Michael Shallow will step down from the board of
Britvic upon the Scheme becoming effective and will not join the
board of the Combined Entity. Each of the Britvic Directors
stepping down from the board of Britvic is fully supportive of the
rationale for the Merger and of its terms and conditions.
Paul Moody has led the Britvic business from October 2003,
initially as Managing Director and subsequently upon IPO in
December 2005 as Chief Executive Officer. The Britvic Directors
wish to recognise the outstanding achievements Paul Moody has
delivered as Chief Executive Officer of the Britvic Group. Paul
Moody will leave the Britvic business in a strong position to take
advantage of the next phase of its development as it merges with
A.G. Barr.
The boards of both Britvic and A.G. Barr also thank Paul Moody
for his unerring support over the last few months in helping to
progress the proposed Merger, which will create a combined business
with a strong brand portfolio and significant prospects for future
growth.
A.G. Barr and Britvic attach great importance to the skills and
experience of the existing management and employees of A.G. Barr
and Britvic and believe that they will benefit from greater
opportunities within the Combined Group.
The Executive Committee of the Combined Group will be drawn from
the management teams of both companies, based on merit.
The senior management structure of the Combined Group will be
constructed to ensure that the Combined Group benefits from the
best skills and experience of both companies.
The boards of A.G. Barr and Britvic recognise that in order to
achieve the expected benefits of the Merger, operational and
administrative restructuring will be required following completion
of the Merger.
It is envisaged that the Combined Entity's legal headquarters
and registered office will be located at A.G. Barr's existing head
office in Cumbernauld. The operational headquarters of the Combined
Group will be located at Britvic's existing head office in Hemel
Hempstead.
Following preliminary analysis undertaken by the boards of A.G.
Barr and Britvic, it is envisaged that areas of overlapping
corporate, commercial, operational and support functions will be
identified as part of the integration review and decisions taken to
implement rationalisation, which will involve some headcount
reduction, although specific roles have not yet been
identified.
The integration review will build on the synergy work carried
out to date and will consider the Combined Group's manufacturing
footprint. This process will produce a detailed integration plan
for agreement by the board of the Combined Entity which will
involve a reduction of headcount and places of business where there
is opportunity to achieve efficiencies and rationalise the Combined
Group's manufacturing footprint. The directors of A.G. Barr and
Britvic believe the net reduction in Combined Group headcount is
likely to be in the range of 8-12 per cent. The number of employees
and locations affected will depend on the outcome of the
integration planning and these changes will only come into effect
as synergies are realised over the three years post completion.
It is likely that the Combined Group will accelerate the fitting
out and commissioning of the new plant at Milton Keynes which was
to be undertaken by A.G. Barr, but the exact details will be
confirmed in light of the conclusions of the broader integration
review.
A.G. Barr has given assurances to the Britvic Directors that,
following completion of the Merger, it is intended that the
existing employment rights of Britvic's employees will be fully
safeguarded.
9. Accounting considerations
The Combined Entity will adopt Britvic's accounting policies.
The A.G. Barr financial year ends at the end of January and the
Britvic financial year ends at the end of September. The Combined
Entity will look at the merits of adopting each of these year ends
but its intention is to retain a January financial year end. For
accounting purposes it is expected that A.G. Barr will be merged
into Britvic's balance sheet. A.G. Barr's assets and liabilities
will be fair valued at the acquisition resulting in the valuation
of A.G. Barr's brands being included on the Combined Group's
balance sheet. Intangibles arising will include goodwill and
brands.
10. Dividends and dividend policy
In recognition of distributable profits earned in the period to
completion of the Merger, it is expected that A.G. Barr
Shareholders and Britvic Shareholders will be paid dividends under
their respective existing dividend policies in relation to the
period up to the Effective Date, expected to be in February 2013,
as set out below:
A.G. Barr
The A.G. Barr Directors intend to declare a second interim
dividend for the year ending 26 January 2013 of 7.4p per share to
be paid on 18 January 2013 to A.G. Barr Shareholders on the
register on 4 January 2013, in lieu of the final dividend for the
financial year ending 26 January 2013. Together with the interim
dividend of 2.6p per share paid to A.G. Barr Shareholders on 19
October 2012, this gives a total dividend for the year ending 26
January 2013 of 10.0p per share, an increase of approximately 7.5
per cent. on the dividend paid for the year ended 28 January
2012.
Britvic
The Britvic Directors intend to declare a second interim
dividend in lieu of the final dividend for the financial year ended
30 September 2012 of 12.4p per share. Together with the interim
dividend of 5.3p per share paid to Britvic Shareholders on 13 July
2012, this gives a total dividend of 17.7p per share for the
financial year ended 30 September 2012, consistent with the prior
financial year. The second interim dividend will be paid on 18
January 2013 to Britvic Shareholders on the register on 7 December
2012.
Additionally, the Britvic Directors intend to declare a special
interim dividend of 10.0p per share, conditional upon the Merger
becoming Effective, in lieu of the dividend in relation to the
period from 1 October 2012 until the Effective Date, and in
recognition of the Combined Group's dividend policy. This will be
paid after the Effective Date to Britvic Shareholders on the
register at the Scheme Record Time. The special dividend will
extend to any Britvic Shares that are unconditionally allotted or
issued pursuant to the exercise of options or the vesting of awards
granted under the Britvic Share Schemes, in each case on or prior
to the Scheme Record Time. Together with the interim dividends of
17.7p per share, this gives a total dividend for the period
(expected to be around 16 months, from 1 October 2011 until the
Effective Date) of 27.7p per share.
Dividend policy
Following completion of the Merger, it is expected that the
Combined Entity will adopt a progressive dividend policy with a
dividend cover ratio of between 2.0 to 2.5 times calculated on an
adjusted earnings per share basis.
Assuming that the Combined Entity operates with a January
financial year end, it is expected that interim dividends for the
period to July will be declared in September and paid in October
and final dividends for the period to January will be declared in
March and paid in June of the following year. Assuming that the
Merger will be completed in February 2013, as currently
anticipated, an interim dividend would (subject to the usual
considerations), therefore, be declared in September 2013.
The board of directors of the Combined Entity will decide the
absolute level of interim and final dividends to be paid for the
year to January 2014 at the relevant time in light of the
performance and cashflow of the Combined Group and the rate at
which synergies are being realised.
11. Structure of the Merger
It is intended that the Merger will be implemented by way of a
Court-sanctioned scheme of arrangement between Britvic and the
Britvic Shareholders, under Part 26 of the Companies Act.
The purpose of the Scheme is to provide for A.G. Barr to become
the owner of the entire issued and to be issued ordinary share
capital of Britvic. This is to be achieved by the cancellation of
the Britvic Shares held by Britvic Shareholders and the application
of the reserve arising from such cancellation in paying up in full
such number of new Britvic Shares as is equal to the number of
Britvic Shares cancelled, and issuing those new shares to A.G. Barr
in consideration of the issue of New A.G. Barr Shares to Britvic
Shareholders on the register of members at the Scheme Record Time
on the basis set out in paragraph 1 of this announcement.
The Merger is subject to the Conditions and certain further
terms referred to in Appendix 1 to this announcement and to be set
out in the Scheme Document, and will only become effective if,
among other things, the following events occur on or before 30 June
2013 or such later date as A.G. Barr and Britvic may agree and (if
required) the Court and the Panel may allow:
(a) a resolution to approve the Scheme being passed by a
majority in number of the Britvic Shareholders who are present and
voting at the Court Meeting, either in person or by proxy,
representing 75 per cent. or more in value of the Britvic Shares
voted by those Britvic Shareholders;
(b) the Special Resolution necessary to implement the Scheme and
to approve the related Reduction of Capital being passed by the
requisite majority of Britvic Shareholders at the Britvic General
Meeting;
(c) the Scheme being sanctioned (with or without modification,
on terms agreed by A.G. Barr and Britvic) and the related Reduction
of Capital being confirmed by the Court;
(d) a copy of the Court Order (together with the Statement of
Capital) being delivered to the Registrar of Companies and, if so
ordered by the Court, the Court Order being registered by the
Registrar of Companies together with the Statement of Capital;
(e) the OFT indicating, either unconditionally or subject to the
giving of undertakings reasonably satisfactory to A.G. Barr and
Britvic, that it does not intend to refer the Merger or any part of
it to the Competition Commission;
(f) the resolutions to be proposed at the A.G. Barr General
Meeting to approve the transaction as a "reverse takeover" under
the Listing Rules, to grant authority to the A.G. Barr Directors to
allot the New A.G. Barr Shares and to increase the borrowing limits
set out in A.G. Barr's articles of association being passed by the
requisite majority of A.G. Barr Shareholders (but, for the
avoidance of doubt, not the other resolutions to be proposed at the
A.G. Barr General Meeting which shall not be conditions to the
Merger); and
(g) the UK Listing Authority having acknowledged to A.G. Barr or
its agent (and such acknowledgement not having been withdrawn) that
the application for the admission of the New A.G. Barr Shares to
the premium segment of the Official List has been approved and
(subject to satisfaction of any conditions to which such approval
is expressed) will become effective as soon as a dealing notice has
been issued by the UK Listing Authority and the London Stock
Exchange having acknowledged to A.G. Barr or its agent (and such
acknowledgement not having been withdrawn) that the New A.G. Barr
Shares will be admitted to trading.
A.G. Barr reserves the right to waive, with Britvic's prior
written consent, in whole or in part, the Condition summarised in
paragraph (e) above.
Upon the Scheme becoming effective it will be binding on all
Britvic Shareholders, irrespective of whether or not they attended
or voted at the Court Meeting or the Britvic General Meeting (and
if they attended and voted, whether or not they voted in favour),
and share certificates in respect of Britvic Shares will cease to
be valid and entitlements to Britvic Shares held within the CREST
system will be cancelled.
Britvic Shares will be acquired by A.G. Barr pursuant to the
Scheme fully paid and free from all liens, charges, equities,
encumbrances, rights of pre-emption and any other interests of any
nature whatsoever and together with all rights attaching thereto,
including voting rights and the rights to receive and retain in
full all dividends and other distributions declared, made or paid
on or after the Effective Date, save where the record date for such
dividend or other distribution falls prior to the Effective Date or
otherwise where A.G. Barr and Britvic agree.
The New A.G. Barr Shares issued to Britvic Shareholders pursuant
to the Scheme will be issued credited as fully paid and will rank
pari passu in all respects with existing A.G. Barr Shares,
including the right to receive dividends and other distributions
declared, made or paid on A.G. Barr Shares by reference to a record
date falling after the Effective Date. The New A.G. Barr Shares
will be issued in registered form and will trade under the same
ISIN number as the existing A.G. Barr Shares.
Fractions of New A.G. Barr Shares will not be allotted or issued
pursuant to the Merger and fractional entitlements will be rounded
down to the nearest whole number of New A.G. Barr Shares.
A.G. Barr reserves the right, subject to the consent of the
Panel and with Britvic's prior written consent (such consent, for
the avoidance of doubt, to also be required in the case of any
offer to be made by A.G. Barr in the event Condition 3(c) in
Appendix 1 is not satisfied), to elect to implement the Merger by
way of a Merger Offer. Subject to the receipt of such consent, in
such event, the Merger would be implemented on substantially the
same terms, subject to appropriate amendments (including, without
limitation, an acceptance condition set at 90 per cent. (or such
lesser percentage, being more than 50 per cent., as A.G. Barr may
decide) of the shares to which the Merger Offer relates and of the
voting rights carried by those shares).
If the Scheme does not become effective on or before 30 June
2013 (or such later date as A.G. Barr and Britvic may agree), it
will lapse and the Merger will not proceed.
The Scheme Document will include full details of the Scheme,
together with notices of the Court Meeting and the Britvic General
Meeting. The Scheme Document will also contain the expected
timetable for the Merger, and will specify the necessary actions to
be taken by Britvic Shareholders. The Scheme Document together with
the Forms of Proxy will be posted to Britvic Shareholders and, for
information only, to persons with information rights and to holders
of options and awards granted under the Britvic Share Schemes as
soon as practicable and within 28 days of the date of this
announcement. It is expected that the Court Meeting (subject to the
approval of the Court) will be held in early January 2013. The
Britvic General Meeting is also expected to be held in early
January 2013, immediately following the conclusion (or adjournment)
of the Court Meeting. Subject to the satisfaction or waiver of the
Conditions, it is expected that the Scheme will become effective in
February 2013.
12. A.G. Barr Shareholder approval
In view of the size of the transaction, the Merger constitutes a
"reverse takeover" (as defined in the Listing Rules) for A.G. Barr.
Accordingly, A.G. Barr will be required to seek the approval of
A.G. Barr Shareholders for the Merger at the A.G. Barr General
Meeting. A.G. Barr is required to prepare and send to A.G. Barr
Shareholders a circular summarising the background to and reasons
for the Merger (which will include a notice convening the A.G. Barr
General Meeting). The Merger is conditional on, amongst other
things, the resolutions to approve the Merger as a "reverse
takeover", to grant authority to the A.G. Barr Directors to allot
the New A.G. Barr Shares and to increase the borrowing limits set
out in A.G. Barr's articles of association being passed by the
requisite majority of A.G. Barr Shareholders at the A.G. Barr
General Meeting (but not, for the avoidance of doubt, the other
resolutions to be proposed at the A.G. Barr General Meeting which
shall not be conditions to the Merger).
The A.G. Barr Circular containing the notice of the A.G. Barr
General Meeting will be sent to A.G. Barr Shareholders at the same
time as the Scheme Document is posted to Britvic Shareholders,
which is expected to be as soon as practicable and within 28 days
of the date of this announcement. It is expected that the A.G. Barr
General Meeting will be held in early January 2013.
A.G. Barr will also be required to make the A.G. Barr Prospectus
available to the public in accordance with the Prospectus Rules.
The A.G. Barr Prospectus will contain information relating to the
Combined Group and the New A.G. Barr Shares. It is expected that
the A.G. Barr Prospectus will be published at the same time as the
Scheme Document is posted to Britvic Shareholders.
13. Britvic Share Schemes
The Scheme will extend to any Britvic Shares that are
unconditionally allotted or issued pursuant to the exercise of
options or vesting of awards under the Britvic Share Schemes, in
each case on or prior to the Scheme Record Time.
Appropriate proposals will be made to participants in the
Britvic Share Schemes. In summary, A.G. Barr and Britvic have
agreed that:
(a) all outstanding awards granted under the Britvic Performance
Share Plan and all outstanding options granted under the Britvic
Executive Share Option Scheme will, to the extent unvested, vest on
sanction of the Scheme, subject to the applicable performance
conditions having been met and time pro rating. Where options and
awards have already vested then the Britvic Shares issued on
exercise or vesting will be subject to the Scheme; and
(b) Britvic Shares held on behalf of participants in the Britvic
Share Incentive Plan will be exchanged for New A.G. Barr Shares in
accordance with the Merger ratio, and will continue to be held on
the terms of the Britvic Share Incentive Plan.
It is intended that shareholder approval will be sought at the
A.G. Barr General Meeting for the vesting of outstanding awards
granted under the current A.G. Barr Long Term Incentive Plan on a
time pro rated basis, subject to applicable performance conditions
being met. A.G. Barr has agreed that shareholder approval of a new
long term incentive plan will also be sought at the A.G. Barr
General Meeting. Selected employees of the Britvic Group will be
eligible to participate in the new long term incentive plan. In
addition, employees of the Britvic Group will be eligible to
participate in the A.G. Barr All-Employee Share Ownership Plan and
any future launches under the A.G. Barr savings-related share
option scheme on similar terms as A.G. Barr employees.
Further details of the proposals will be set out in the Scheme
Document and in separate letters to be sent to participants in the
Britvic Share Schemes.
14. Britvic ADSs
The Scheme may not be extended to holders of American Depositary
Shares representing Britvic Shares ("Britvic ADSs") in which case,
if the Scheme becomes effective, The Bank of New York Mellon, as
depositary for the Britvic ADS program (the "Britvic Depositary"),
may sell the New A.G. Barr Shares it receives in the Scheme as
agent for and on behalf of Britvic ADS holders, may call for
surrender of the Britvic ADSs and, upon those surrenders, will
deliver the proceeds of that sale, net of applicable fees,
expenses, taxes and governmental charges, to the Britvic ADS
holders entitled to them in accordance with the terms of the
depositary agreement governing the Britvic ADSs.
Britvic ADS holders will not be entitled to vote directly on the
Scheme and the Merger. Britvic ADS holders have the right to
instruct the Britvic Depositary how to vote the Britvic Shares
underlying the Britvic ADSs with respect to the Scheme and the
Merger, subject to and in accordance with the terms of the
depositary agreement, but the Britvic Depositary will not send
voting cards or otherwise solicit those instructions from Britvic
ADS holders.
If you hold Britvic ADSs and wish to vote directly on the Scheme
and the Merger or to receive New A.G. Barr Shares in the Scheme,
you must surrender your Britvic ADSs to the Britvic Depositary, pay
the Britvic Depositary's fees and charges in accordance with the
depositary agreement governing the Britvic ADSs and become a holder
of Britvic Shares prior to the Scheme Voting Record Time or Scheme
Record Time, as applicable, and in each case subject to and in
accordance with the terms of the depositary agreement. Britvic ADS
holders that wish to vote directly on the Scheme and the Merger or
to receive New A.G. Barr Shares in the Scheme should take care to
surrender their Britvic ADSs in time to permit processing to be
completed by the Britvic Depositary and its English custodian prior
to the Scheme Voting Record Time or the Scheme Record Time, as
applicable. If you hold Britvic ADSs through a broker or other
securities intermediary, you should contact that intermediary to
determine the date by which you must instruct that intermediary to
act in order that the necessary processing can be completed in
time. Britvic ADS holders should refer to the Scheme Document for
further information regarding the treatment of Britvic ADSs.
15. Irrevocable undertakings
In aggregate, A.G. Barr has received irrevocable undertakings
from those of the Britvic Directors and certain members of their
families who hold or are beneficially entitled to Britvic Shares to
vote in favour of the Scheme in respect of 980,959 Britvic Shares,
representing, in aggregate, approximately 0.40 per cent. of
Britvic's share capital in issue on 13 November 2012 (being the
latest practicable date prior to this announcement).
In aggregate, Britvic has received irrevocable undertakings from
those of the A.G. Barr Directors, certain members of their families
and related trusts, who hold or are beneficially entitled to A.G.
Barr Shares to vote in favour of the resolution to be proposed at
the A.G. Barr General Meeting to approve the Merger and the related
resolutions in respect of 23,281,320 A.G. Barr Shares,
representing, in aggregate, approximately 19.94 per cent. of A.G.
Barr's share capital in issue on 13 November 2012 (being the latest
practicable date prior to this announcement).
Further details of the irrevocable undertakings (including the
circumstances in which they lapse) are set out in Appendix 3.
16. Offer-related arrangements
A.G. Barr and Britvic have entered into a mutual confidentiality
agreement dated 24 August 2012 (the "Confidentiality Agreement")
pursuant to which each of A.G. Barr and Britvic has undertaken to
keep confidential information relating to the other party and not
to disclose it to third parties (other than to permitted
disclosees) unless required by law or regulation. These
confidentiality obligations will remain in force until completion
of the Merger.
A.G. Barr and Britvic have entered into a co-operation agreement
dated the date of this announcement (the "Co-operation Agreement")
pursuant to which each of A.G. Barr and Britvic has agreed to use
all reasonable endeavours to obtain confirmation from the OFT, as
soon as reasonably practicable and in any event before the Long
Stop Date, indicating, either unconditionally or subject to the
giving of undertakings reasonably satisfactory to A.G. Barr and
Britvic, that it does not intend to refer the Merger or any part of
it to the Competition Commission. A.G. Barr and Britvic have also
agreed to provide each other with such information and assistance
as they may reasonably require for the purposes of obtaining all
regulatory and other clearances in relation to the Merger, provided
that such assistance will not require the Britvic Directors to
maintain their recommendation of the Merger or to adjourn or seek
to adjourn any shareholder meeting or court hearing in connection
with the Scheme or require Britvic or A.G. Barr to make any change
to the timetable for implementing the Merger. The Co-operation
Agreement also sets out certain agreements reached between A.G.
Barr and Britvic in relation to the treatment of the Britvic Share
Schemes, certain share schemes operated by A.G. Barr and the
continuation of the enhanced early retirement facility currently
offered under the Britvic pension plan until 6 April 2016. The
Co-operation Agreement will terminate if the Scheme (or the Merger
Offer if A.G. Barr elects, subject to consent from the Panel and
Britvic's written consent, to implement the Merger by way of a
contractual takeover offer) is withdrawn or lapses, if the Britvic
Directors withdraw their recommendation of the Scheme (or the
Merger Offer, as the case may be) or if the Scheme does not become
effective in accordance with its terms by the Long Stop Date or
otherwise as agreed between A.G. Barr and Britvic.
17. Listing, dealings and settlement of the New A.G. Barr Shares
Applications will be made to the UK Listing Authority for the
New A.G. Barr Shares to be admitted to the premium listing segment
of the Official List and to the London Stock Exchange for the New
A.G. Barr Shares to be admitted to trading on the London Stock
Exchange's main market for listed securities ("Admission"). It is
expected that Admission will become effective and that dealings for
normal settlement in the New A.G. Barr Shares will commence on the
London Stock Exchange at 8.00 a.m. on or shortly after the
Effective Date.
18. De-listing of Britvic
Prior to the Scheme becoming effective, applications will be
made to the UK Listing Authority for the cancellation of the
listing of Britvic Shares on the Official List and to the London
Stock Exchange for the cancellation of trading of Britvic Shares on
the London Stock Exchange's main market for listed securities, with
effect as of or shortly following the Effective Date.
On the Effective Date, Britvic will become a wholly owned
subsidiary of A.G. Barr and share certificates in respect of
Britvic Shares will cease to be valid and entitlements to Britvic
Shares held within the CREST system will be cancelled.
19. Disclosure of interests in relevant securities
A.G. Barr confirms that it made an Opening Position Disclosure,
setting out the details required to be disclosed by it under Rule
8.1(a) of the Code, on 17 September 2012.
20. Overseas shareholders
The availability of New A.G. Barr Shares under the Merger to
persons who are not resident in, and the distribution of this
announcement to persons who are not resident in, the United Kingdom
may be affected by the laws of the relevant jurisdiction in which
they are located. Such persons should inform themselves of, and
observe, any applicable legal or regulatory requirements of their
jurisdiction. Britvic Shareholders who are in any doubt regarding
such matters should consult an appropriate independent professional
adviser in the relevant jurisdiction without delay.
This announcement does not constitute an offer for sale of any
securities or an offer or an invitation to purchase any securities.
Britvic Shareholders are advised to read carefully the Scheme
Document, the A.G. Barr Prospectus and the Forms of Proxy once
these have been dispatched.
21. Documents on display
Copies of the following documents will be published by no later
than noon (London time) on the day following this announcement on
A.G. Barr's website at www.agbarr.co.uk and on Britvic's website at
http://ir.britvic.com until the Effective Date:
-- the irrevocable undertakings referred to in paragraph 15
above and summarised in Appendix 3 to this announcement;
-- the Confidentiality Agreement; and
-- the Co-operation Agreement.
22. General
The Merger will be subject to the Conditions and certain further
terms set out in Appendix 1 and to be set out in the Scheme
Document when issued.
The Scheme will be governed by English law and will be subject
to the jurisdiction of the courts of England and Wales. The Scheme
will be subject to the applicable requirements of the Code, the
Panel, the London Stock Exchange and the FSA.
The bases and sources of certain financial information contained
in this announcement are set out in Appendix 2. Certain terms used
in this announcement are defined in Appendix 5.
Enquiries
A.G. BARR p.l.c.
Roger White +44 (0) 123 685 2400
Alex Short
Rothschild (financial adviser to A.G. Barr)
Akeel Sachak +44 (0) 207 280 5000
Stuart Vincent
Jessica Dale
Investec Bank plc (broker to A.G. Barr)
Keith Anderson +44 (0) 207 597 5970
David Anderson
Henry Reast
College Hill (PR adviser to A.G. Barr)
Justine Warren +44 (0) 207 457 2020
Matthew Smallwood
Britvic plc
Gerald Corbett +44 (0) 1442 284300
John Gibney
Rupen Shah
Steve Nightingale
Citigroup Global Markets Limited (joint financial adviser and
joint broker to Britvic)
David Wormsley +44 (0) 207 986 4000
Jan Skarbek
Andrew Seaton
Nomura International plc (joint financial adviser and joint
broker to Britvic)
Richard Snow +44(0) 207 521 2000
Nicholas Marren
Brunswick (PR adviser to Britvic)
Mike Smith +44(0) 207 404 5959
Nick Cosgrove
Further information
This announcement is for information purposes only. It is not
intended to and does not constitute, or form part of, an offer,
invitation or the solicitation of an offer to purchase, otherwise
acquire, subscribe for, sell or otherwise dispose of any
securities, or the solicitation of any vote or approval in any
jurisdiction, pursuant to the Merger or otherwise nor shall there
be any sale, issuance or transfer of securities in any jurisdiction
in contravention of applicable law. The Merger will be made solely
by means of the Scheme Document which, together with the Forms of
Proxy, will contain the full terms and conditions of the Merger
including details of how to vote in respect of the Merger.
Britvic will prepare the Scheme Document to be distributed to
Britvic Shareholders and A.G. Barr will prepare the A.G. Barr
Circular to be distributed to A.G. Barr Shareholders. A.G. Barr
will also publish the A.G. Barr Prospectus containing information
about the New A.G. Barr Shares and the Combined Group. Britvic
urges Britvic Shareholders to read the Scheme Document and the A.G.
Barr Prospectus when they become available because they will
contain important information in relation to the Merger, the New
A.G. Barr Shares and the Combined Group. A.G. Barr urges A.G. Barr
Shareholders to read the A.G. Barr Circular and the A.G. Barr
Prospectus when they become available because they will contain
important information in relation to the Merger, the New A.G. Barr
Shares and the Combined Group. Any vote in respect of the Scheme or
other response in relation to the Merger should be made only on the
basis of the information contained in the Scheme Document and the
A.G. Barr Prospectus, or the A.G. Barr Circular and the A.G. Barr
Prospectus, as appropriate.
This announcement does not constitute a prospectus or prospectus
equivalent document.
Please be aware that addresses, electronic addresses and certain
other information provided by Britvic Shareholders, persons with
information rights and other relevant persons for the receipt of
communications from Britvic may be provided to A.G. Barr during the
offer period as required under Section 4 of Appendix 4 of the
Code.
Rothschild, which is authorised and regulated in the United
Kingdom by the FSA, is acting exclusively for A.G. Barr and for
no-one else in connection with the matters set out in this
announcement and will not be responsible to anyone other than A.G.
Barr for providing the protections afforded to its clients or for
providing advice in connection with the matters set out in this
announcement.
Investec Bank plc, which is authorised and regulated in the
United Kingdom by the FSA, is acting as corporate broker to A.G.
Barr and for no-one else in connection with the matters set out in
this announcement and will not be responsible to anyone other than
A.G. Barr for providing the protections afforded to its clients or
for providing advice in connection with the matters set out in this
announcement.
Citigroup Global Markets Limited, which is authorised and
regulated in the United Kingdom by the FSA, is acting exclusively
for Britvic and for no-one else in connection with the matters set
out in this announcement and will not be responsible to anyone
other than Britvic for providing the protections afforded to its
clients or for providing advice in connection with the matters set
out in this announcement.
Nomura International plc, which conducts its UK investment
banking business as Nomura, is authorised and regulated in the
United Kingdom by the FSA and is acting as joint broker and joint
financial adviser to Britvic and for no-one else in connection with
the matters set out in this announcement. Nomura will not be
responsible to anyone other than Britvic for providing the
protection afforded to its clients or for providing advice in
connection with the matters set out in this announcement.
Notice to US holders of Britvic Shares
The Merger will involve an exchange of the securities of an
English company for the securities of a Scottish company and will
be subject to UK disclosure requirements, which are different from
those of the United States. The financial information included in
this announcement has been prepared in accordance with IFRS and
thus may not be comparable to financial information of US companies
or companies whose financial statements are prepared in accordance
with generally accepted accounting principles in the United
States.
The Merger will be made by means of a scheme of arrangement
under the Companies Act and otherwise in accordance with the
requirements of the Code. The scheme of arrangement will relate to
the shares of an English company that is not registered under the
US Exchange Act.
Accordingly, the proposed combination will be subject to
disclosure and other procedural requirements applicable in the UK
to schemes of arrangement, which differ from the disclosure
requirements of the US proxy and tender offer rules under the US
Exchange Act.
Any securities to be issued under the Merger have not been and
will not be registered under the US Securities Act, or under the
securities laws of any state, district or other jurisdiction of the
United States, or of Australia, Canada or Japan. Accordingly such
securities may not be offered, sold or delivered, directly or
indirectly, in or into such jurisdictions except pursuant to
exemptions from, or transactions not subject to, applicable
requirements of such jurisdictions. It is expected that the New
A.G. Barr Shares will be issued in reliance upon the exemption from
such registration provided by Section 3(a)(10) of the US Securities
Act. Under applicable US securities laws, persons (whether or not
US persons) who are or will be "affiliates" (within the meaning of
the US Securities Act) of Britvic or A.G. Barr prior to, or of the
Combined Entity after, the Effective Date will be subject to
certain transfer restrictions relating to the New A.G. Barr Shares
received in connection with the Merger.
It may be difficult for US holders of Britvic Shares to enforce
their rights and any claim arising out of the US federal securities
laws, since A.G. Barr and Britvic are incorporated and located in
non-US jurisdictions, and some or all of their officers and
directors may be residents of a non-US jurisdiction. US holders of
Britvic Shares may not be able to sue a non-US company or its
officers or directors in a non-US court for violations of the US
securities laws. Further, it may be difficult to compel a non-US
company and its affiliates to subject themselves to a US court's
judgment.
If A.G. Barr exercises its right, subject to the consent of the
Panel, to implement the Merger by way of a Merger Offer, the Merger
will be made in compliance with applicable US laws and regulations,
including applicable provisions of the tender offer rules under the
US Exchange Act, to the extent applicable.
Overseas jurisdictions
The availability of New A.G. Barr Shares under the Merger to
Britvic Shareholders who are not resident in the UK may be affected
by the laws of the relevant jurisdictions in which they are
located. Persons who are not resident in the UK should inform
themselves of, and observe, any applicable legal or regulatory
requirements of their jurisdictions.
The release, publication or distribution of this announcement in
or into jurisdictions other than the UK may be restricted by law
and therefore any persons who are subject to the law of any
jurisdiction other than the UK should inform themselves about, and
observe, any applicable requirements. Any failure to comply with
the applicable restrictions may constitute a violation of the
securities laws of any such jurisdiction. To the fullest extent
permitted by applicable law, the companies and persons involved in
the Merger disclaim any responsibility or liability for the
violation of such restrictions by any person.
This announcement has been prepared for the purposes of
complying with English and Scots law, the Listing Rules, the rules
of the London Stock Exchange 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 of the UK.
Unless otherwise determined by A.G. Barr and Britvic or required
by the Code, and permitted by applicable law and regulation, the
Merger will not be made, directly or indirectly, in, into or from
any Restricted Jurisdiction where to do so would violate the laws
in that jurisdiction and no person may vote in favour of the Merger
by any such use, means, instrumentality or from within a Restricted
Jurisdiction. Accordingly, copies of this announcement and formal
documentation relating to the Merger will not be and must not be,
directly or indirectly, mailed or otherwise forwarded, distributed
or sent in, into or from any Restricted Jurisdiction where to do so
would violate the laws of that jurisdiction and persons receiving
this announcement and all documents relating to the Merger
(including custodians, nominees and trustees) must not mail or
otherwise distribute or send them in, into or from such
jurisdictions where to do so would violate the laws in that
jurisdiction.
Forward-looking statements
This announcement contains statements which are, or may be
deemed to be, "forward-looking statements" which are prospective in
nature. All statements other than statements of historical fact are
forward-looking statements. They are based on current expectations
and projections about future events, and are therefore subject to
risks and uncertainties which could cause actual results to differ
materially from the future results expressed or implied by the
forward-looking statements. Often, but not always, forward-looking
statements can be identified by the use of forward-looking words
such as "plans", "expects", "is expected", "is subject to",
"budget", "scheduled", "estimates", "forecasts", "intends",
"anticipates", "believes", "targets", "aims", "projects" or words
or terms of similar substance or the negative thereof, as well as
variations of such words and phrases or statements that certain
actions, events or results "may", "could", "should", "would",
"might" or "will" be taken, occur or be achieved. Such statements
are qualified in their entirety by the inherent risks and
uncertainties surrounding future expectations. 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 A.G. Barr's or Britvic's
operations and potential synergies resulting from the Merger; and
(iii) the effects of global economic conditions on A.G. Barr's or
Britvic's business.
Such forward-looking statements involve known and unknown risks
and uncertainties that could significantly affect expected results
and are based on certain key assumptions. Many factors may cause
the actual results, performance or achievements of A.G. Barr,
Britvic or the Combined Group to be materially different from any
future results, performance or achievements expressed or implied by
the forward-looking statements. Important factors that could cause
actual results, performance or achievements of A.G. Barr, Britvic
or the Combined Group to differ materially from the expectations of
A.G. Barr, Britvic or the Combined Group, as applicable, include,
among other things, general business and economic conditions
globally, industry trends, competition, changes in government and
other regulations, including in relation to the environment, health
and safety and taxation, labour relations and work stoppages,
changes in political and economic stability, disruptions in
business operations due to reorganisation activities (whether or
not A.G. Barr combines with Britvic), interest rate and currency
fluctuations, the failure to satisfy any conditions for the Merger
(including approvals or clearances from regulatory and other
agencies and bodies) on a timely basis or at all, the inability of
the Combined Group to realise successfully any anticipated synergy
benefits when the Merger is implemented, the
inability of the Combined Group to integrate successfully A.G.
Barr's and Britvic's operations and programmes when the Merger is
implemented, or the Combined Group incurring and/or experiencing
unanticipated costs and/or delays or difficulties relating to the
Merger when the Merger is implemented. Such forward-looking
statements should therefore be construed in light of such
factors.
Neither A.G. Barr nor Britvic, nor any of their respective
associates or directors, officers or advisers, provides any
representation, assurance or guarantee that the occurrence of the
events expressed or implied in any forward-looking statements in
this announcement will actually occur. You are cautioned not to
place undue reliance on these forward-looking statements, which
speak only as of the date hereof.
Other than in accordance with its legal or regulatory
obligations (including under the Listing Rules and the Disclosure
and Transparency Rules of the FSA), neither A.G. Barr nor Britvic
is under any obligation and A.G. Barr and Britvic each expressly
disclaim any intention or obligation to update or revise any
forward-looking statements, whether as a result of new information,
future events or otherwise.
No profit forecasts or estimates
Other than the Britvic Profit Estimate, no statement in this
announcement is intended as a profit forecast or estimate for any
period and no statement in this announcement should be interpreted
to mean that earnings or earnings per ordinary share for A.G. Barr
or Britvic, as appropriate, for the current or future financial
years would necessarily match or exceed the historical published
earnings or earnings per ordinary share for A.G. Barr or Britvic,
as appropriate.
The Britvic Profit Estimate is a profit forecast for the
purposes of Rule 28 of the Code. As such it is a requirement under
the Code that the Britvic Profit Estimate be reported on by
Britvic's reporting accountants and financial advisers. The bases
behind the Britvic Profit Estimate and the reports of Ernst &
Young LLP and Citigroup Global Markets Limited are set out in
Appendix 4 to this announcement. Ernst & Young LLP and
Citigroup Global Markets Limited have given and not withdrawn their
consent to the publication of their reports in the form and context
in which they are included.
Britvic Directors' responsibility statement
The Britvic Directors accept sole responsibility for the Britvic
Profit Estimate.
Disclosure requirements of the Code
Under Rule 8.3(a) of the Code, any person who is interested in 1
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 p.m. (London time) on the 10th business day following the
commencement of the offer period and, if appropriate, by no later
than 3.30 p.m. (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 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 p.m. (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 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.
You should contact the Panel's Market Surveillance Unit on +44 (0)
20 7638 0129 if you are in any doubt as to whether you are required
to make an Opening Position Disclosure or a Dealing Disclosure.
Rule 2.10 disclosure
In accordance with Rule 2.10 of the Code, A.G. Barr confirms
that, as at the date of this announcement, it has 116,768,778
ordinary shares of 4 (1) /(6) pence each in issue with ISIN
GB00B6XZKY75 and Britvic confirms that, as at the date of this
announcement, it has 242,344,551 ordinary shares of 20 pence each
in issue with ISIN GB00B0N8QD54.
Britvic has a Level 1 American Depositary Receipt programme,
under which ordinary shares of 20 pence each are traded in the form
of American Depositary Shares on the OTCQX market. The ordinary
shares of 20 pence each traded in the form of American Depositary
Shares with ISIN number US1111901047, on a ratio of one ordinary
share to two American Depositary Shares, are included within the
total set out above.
Publication on website
A copy of this announcement will be available free of charge,
subject to certain restrictions relating to persons resident in
Restricted Jurisdictions, on A.G. Barr's website at
www.agbarr.co.uk and on Britvic's website at http://ir.britvic.com
by no later than noon (London time) on the day following this
announcement. For the avoidance of doubt, the contents of those
websites are not incorporated into and do not form part of this
announcement.
You may request a hard copy of this announcement, free of
charge, by contacting the Company Secretary of A.G. Barr at
companysecretarialdepartment@agbarr.co.uk (or on +44(0)1236 852400)
or by writing to A.G. BARR p.l.c., Westfield House, 4 Mollins Road,
Cumbernauld, G68 9HD, or by contacting the Company Secretary of
Britvic at company.secretariat@britvic.co.uk (or on +44(0)1442
284411) or by writing to Britvic plc, Breakspear Park, Breakspear
Way, Hemel Hempstead, HP2 4TZ.
You may also request that all future documents, announcements
and information to be sent to you in relation to the Merger should
be in hard copy form.
APPENDIX 1
CONDITIONS AND CERTAIN FURTHER TERMS OF THE SCHEME AND THE
MERGER
A. CONDITIONS TO THE SCHEME AND THE MERGER
1. The Merger will be conditional upon the Scheme becoming
unconditional and effective, subject to the Code, by not later than
30 June 2013 or such later date (if any) as A.G. Barr and Britvic
may agree and (if required) the Court and the Panel may allow.
2. The Scheme will be subject to the following conditions:
2.1 its approval by a majority in number of the Britvic
Shareholders who are present and vote, whether in person or by
proxy, at the Court Meeting and who represent not less than 75 per
cent. in value of the Britvic Shares voted by those Britvic
Shareholders;
2.2 the resolutions required to approve and implement the Scheme
and the Reduction of Capital being duly passed by the requisite
majorities of Britvic Shareholders at the Britvic General Meeting;
and
2.3 the sanction of the Scheme (with or without modification but
subject to any modification being on terms acceptable to A.G. Barr
and Britvic) and the confirmation of the Reduction of Capital by
the Court and (a) the delivery of a copy of the Court Order and the
Statement of Capital to the Registrar of Companies and (b) if so
ordered by the Court, the registration of the Court Order and the
Statement of Capital.
3. In addition, subject as stated in Part B below and to the
requirements of the Panel, the Merger will be conditional upon the
following Conditions and, accordingly, the necessary actions to
make the Scheme effective will not be taken unless such Conditions
(as amended if appropriate) have been satisfied or, where relevant,
waived:
Approval of A.G. Barr Shareholders
(a) the resolutions of A.G. Barr Shareholders required to: (i)
approve, effect and implement the Merger, (ii) confer authorities
for the issue and allotment of the New A.G. Barr Shares to be
issued in connection with the Merger, and (iii) increase the
borrowing limits set out in A.G. Barr's articles of association (as
such resolutions may be set out in the A.G. Barr Circular) (but
excluding, for the avoidance of doubt, the other resolutions to be
proposed at the A.G. Barr General Meeting which shall not be
conditions to the Merger), being duly passed at the A.G. Barr
General Meeting (or at any adjournment thereof) in each case by the
requisite majority of A.G. Barr Shareholders;
Admission of the New A.G. Barr Shares
(b) the UK Listing Authority having acknowledged to A.G. Barr or
its agent (and such acknowledgement not having been withdrawn) that
the application for the admission of the New A.G. Barr Shares to
the Official List with a premium listing has been approved and
(after satisfaction of any conditions to which such approval is
expressed to be subject ("listing conditions")) will become
effective as soon as a dealing notice has been issued by the UK
Listing Authority and any listing conditions having been satisfied
and (ii) the London Stock Exchange having acknowledged to A.G. Barr
or its agent (and such acknowledgement not having been withdrawn)
that the New A.G. Barr Shares will be admitted to trading on the
main market of the London Stock Exchange;
UK merger control
(c) the Office of Fair Trading ("OFT") indicating, either
unconditionally or subject to the giving of undertakings reasonably
satisfactory to A.G. Barr and Britvic, that it does not intend to
refer the Merger or any part of it to the Competition
Commission;
Notifications, waiting periods and authorisations
(d) other than in relation to the matters referred to in
Conditions 3(a) to (c), all material notifications, filings or
applications which are necessary or reasonably considered
appropriate in connection with the Merger having been made and all
necessary waiting periods (including any extensions thereof) under
any applicable legislation or regulation of any jurisdiction having
expired, lapsed or been terminated (as appropriate) and all
statutory and regulatory obligations in any jurisdiction having
been complied with in each case in respect of the Merger and all
Authorisations deemed necessary or reasonably appropriate by A.G.
Barr and Britvic in any jurisdiction for or in respect of the
Merger and, except pursuant to Chapter 3 of Part 28 of the
Companies Act, the acquisition or the proposed acquisition of any
shares or other securities in, or control or management of, Britvic
or any other member of the Wider Britvic Group by any member of the
Wider A.G. Barr Group having been obtained in terms and in a form
reasonably satisfactory to A.G. Barr and Britvic from all
appropriate Third Parties or (without prejudice to the generality
of the foregoing) from any person or bodies with whom any member of
the Wider Britvic Group or the Wider A.G. Barr Group has entered
into contractual arrangements and all such Authorisations
necessary, appropriate or desirable to carry on the business of any
member of the Wider Britvic Group in any jurisdiction having been
obtained and all such Authorisations remaining in full force and
effect at the time at which the Merger becomes otherwise wholly
unconditional and there being no notice or intimation of an
intention to revoke, suspend, restrict, modify or not to renew such
Authorisations;
General antitrust and regulatory
(e) other than in relation to the matters referred to in
Conditions 3(b) and (c), no antitrust regulator or Third Party
having given notice of a decision to take, institute, implement or
threaten any action, proceeding, suit, investigation, inquiry or
reference (and in each case, not having withdrawn the same), or
having required any action to be taken or otherwise having done
anything, or having enacted, made or proposed any statute,
regulation, decision, order or change to published practice (and in
each case, not having withdrawn the same) and there not continuing
to be outstanding any statute, regulation, decision or order which
would or might reasonably be expected to (in any case which is
material in the context of the Merger):
(i) require, prevent or materially delay or affect the
divestiture or materially prejudice the terms envisaged for such
divestiture by any member of the Wider A.G. Barr Group or by any
member of the Wider Britvic Group of all or any material part of
their respective businesses, assets or property or of any Britvic
Shares or other securities in Britvic or impose any limitation on
the ability of all or any of them to conduct their businesses (or
any part thereof) or to own, control or manage any of their assets
or properties (or any part thereof) to an extent which is material
in the context of the Wider Britvic Group or Wider A.G. Barr Group
(as the case may be) taken as a whole;
(ii) except pursuant to Chapter 3 of Part 28 of the Companies
Act, require any member of the Wider A.G. Barr Group or the Wider
Britvic Group to acquire or offer to acquire any shares, other
securities (or the equivalent) or interest in any member of the
Wider Britvic Group or any asset owned by any Third Party (other
than in the implementation of the Merger);
(iii) impose any limitation on, or result in a delay in, the
ability of any member of the Wider A.G. Barr Group directly or
indirectly to acquire, hold or to exercise effectively all or any
rights of ownership in respect of shares or other securities in
Britvic or on the ability of any member of the Wider Britvic Group
or any member of the Wider A.G. Barr Group directly or indirectly
to hold or exercise effectively all or any rights of ownership in
respect of shares or other securities (or the equivalent) in, or to
exercise voting or management control over, any member of the Wider
Britvic Group to an extent which is material in the context of the
Wider Britvic Group or Wider A.G. Barr Group (as the case may be)
taken as a whole;
(iv) otherwise adversely affect any or all of the business,
assets, financial or trading position, profits or prospects of any
member of the Wider Britvic Group or any member of the Wider A.G.
Barr Group to an extent which is material in the context of the
Wider Britvic Group or Wider A.G. Barr Group (as the case may be)
taken as a whole;
(v) result in any member of the Wider Britvic Group or any
member of the Wider A.G. Barr Group ceasing to be able to carry on
business under any name under which it presently carries on
business;
(vi) make the Merger or its implementation, or the acquisition
or proposed acquisition of any shares or other securities in or
control of Britvic by any member of the Wider A.G. Barr Group,
void, unenforceable and/or illegal under the laws of any relevant
jurisdiction, or otherwise, directly or indirectly, prevent or
prohibit, restrict, restrain, or delay the same or otherwise
interfere with the Merger or its implementation, or impose material
additional conditions or obligations with respect to, or otherwise
impede, interfere or require amendment of the Merger or the
acquisition or proposed acquisition of any shares or other
securities in or control of Britvic by any member of the Wider A.G.
Barr Group to an extent which is material in the context of the
Merger;
(vii) require, prevent or materially delay a divestiture by any
member of the Wider A.G. Barr Group of any shares or other
securities (or the equivalent) in any member of the Wider Britvic
Group or any member of the Wider A.G. Barr Group to an extent which
is material in the context of the Wider Britvic Group or Wider A.G.
Barr Group (as the case may be) taken as a whole; or
(viii) impose any limitation on the ability of any member of the
Wider A.G. Barr Group or any member of the Wider Britvic Group to
conduct or integrate all or any part of its business with all or
any part of the business of any other member of the Wider A.G. Barr
Group and/or the Wider Britvic Group to an extent which is material
in the context of the Wider Britvic Group or Wider A.G. Barr Group
(as the case may be) taken as a whole,
and all applicable waiting and other time periods (including any
extensions thereof) during which any such antitrust regulator or
Third Party could decide to take, institute, implement or threaten
any such action, proceeding, suit, investigation, enquiry or
reference or take any other step under the laws of any jurisdiction
in respect of the Merger having expired, lapsed or been
terminated;
Certain matters arising as a result of any arrangement,
agreement, etc.
(f) except as Disclosed, there being no provision of any
arrangement, agreement, lease, licence, franchise, permit or other
instrument to which any member of the Wider Britvic Group is a
party or by or to which any such member or any of its assets is or
may be bound, entitled or subject or any event or circumstance
which, as a consequence of the Merger or because of a change in the
control of Britvic or any other member of the Wider Britvic Group,
could or might reasonably be expected to result in (in any case to
an extent which is or would be material in the context of the Wider
Britvic Group taken as a whole):
(i) any monies borrowed by, or any other indebtedness, actual or
contingent, of, or any grant available to, any member of the Wider
Britvic Group being or becoming repayable, or capable of being
declared repayable, immediately or prior to its or their stated
maturity date or repayment date, or the ability of any such member
to borrow monies or incur any indebtedness being withdrawn or
inhibited or being capable of becoming or being withdrawn or
inhibited;
(ii) the creation or enforcement of any mortgage, charge or
other security interest over the whole or any part of the business,
property or assets of any member of the Wider Britvic Group or any
such mortgage, charge or other security interest (whenever created,
arising or having arisen) becoming enforceable;
(iii) any such arrangement, agreement, lease, licence,
franchise, permit or other instrument being terminated or the
rights, liabilities, obligations or interests of any member of the
Wider Britvic Group therein being adversely modified or adversely
affected or any obligation or liability arising or any adverse
action being taken or arising thereunder;
(iv) any liability of any member of the Wider Britvic Group to
make any severance, termination, bonus or other payment to any of
its directors or other officers;
(v) the rights, liabilities, obligations, interests or business
of any member of the Wider Britvic Group under any such
arrangement, agreement, lease, licence, franchise, permit or other
instrument, or the interests or business of any member of the Wider
Britvic Group in or with any other person, body, firm or company
(or any agreement or arrangement relating to any such interests or
business) being or becoming capable of being terminated, or
adversely modified or affected or any onerous obligation or
liability arising or any adverse action being taken thereunder;
(vi) any member of the Wider Britvic Group ceasing to be able to
carry on business under any name under which it presently carries
on business;
(vii) the value of, or the financial or trading position or
prospects of, any member of the Wider Britvic Group being
prejudiced or adversely affected; or
(viii) the creation or acceleration of any liability (actual or
contingent) by any member of the Wider Britvic Group other than
trade creditors or other liabilities incurred in the ordinary
course of business,
and no event having occurred which, under any provision of any
arrangement, agreement, lease, licence, franchise, permit or other
instrument to which any member of the Wider Britvic Group is a
party or by or to which any such member or any of its assets are
bound, entitled or subject, would be expected to result in any of
the events or circumstances as are referred to in Conditions (f)(i)
to (viii) (in each case to an extent which is material in the
context of the Wider Britvic Group taken as a whole);
Certain events occurring since 2 October 2011
(g) except as Disclosed, no member of the Wider Britvic Group
having since 2 October 2011:
(i) issued or agreed to issue, or authorised or proposed or
announced its intention to authorise or propose the issue of,
additional shares of any class or securities or securities
convertible into, or exchangeable for, or rights, warrants or
options to subscribe for or acquire, any such shares, securities or
convertible securities or transferred or sold or agreed to transfer
or sell or authorised or proposed the transfer or sale of Britvic
Shares out of treasury (except, where relevant, as between Britvic
and wholly owned subsidiaries of Britvic or between the wholly
owned subsidiaries of Britvic and except for the issue or transfer
out of treasury of Britvic Shares on the exercise of employee share
options or vesting of employee share awards in the ordinary course
under the Britvic Share Schemes);
(ii) recommended, declared, paid or made or proposed to
recommend, declare, pay or make any bonus, dividend or other
distribution (whether payable in cash or otherwise) other than the
second interim dividend in relation to the financial year ended 30
September 2012 of up to 12.4p per share and the special interim
dividend of up to 10.0p per share in relation to the period from 1
October 2012 to the Effective Date (as described in section 10
(Dividends and dividend policy) of this announcement) or dividends
(or other distributions whether payable in cash or otherwise)
lawfully paid or made by any wholly owned subsidiary of Britvic to
Britvic or any of its wholly owned subsidiaries;
(iii) other than pursuant to the Merger (and except for
transactions between Britvic and its wholly owned subsidiaries or
between the wholly owned subsidiaries of Britvic and transactions
in the ordinary course of business) implemented, effected,
authorised or proposed or announced its intention to implement,
effect, authorise or propose any merger, demerger, reconstruction,
amalgamation, scheme, commitment, acquisition or disposal of assets
or shares or loan capital (or the equivalent thereof) in any
undertaking or undertakings in any such case to an extent which is
material in the context of the Wider Britvic Group taken as a
whole;
(iv) (except for transactions between Britvic and its wholly
owned subsidiaries or between the wholly owned subsidiaries of
Britvic) disposed of, or transferred, mortgaged or created any
security interest over any asset or any right, title or interest in
any asset or authorised, proposed or announced any intention to do
so which in any case is material in the context of the Wider
Britvic Group taken as a whole;
(v) (except for transactions between Britvic and its wholly
owned subsidiaries or between the wholly owned subsidiaries of
Britvic) issued, authorised or proposed or announced an intention
to authorise or propose the issue of, or made any change in or to
the terms of, any debentures or become subject to any contingent
liability or incurred or increased any indebtedness which in any
case is material in the context of the Wider Britvic Group taken as
a whole;
(vi) entered into or varied or authorised, proposed or announced
its intention to enter into or vary any material contract,
arrangement, agreement, transaction or commitment (whether in
respect of capital expenditure or otherwise) except in the ordinary
course of business which is of a long term, unusual or onerous
nature or magnitude or which involves an obligation of a nature or
magnitude which is likely to be restrictive on the business of any
member of the Wider Britvic Group and which in any case is material
in the context of the Wider Britvic Group taken as a whole;
(vii) entered into or varied the terms of, or made any offer
(which remains open for acceptance) to enter into or vary to a
material extent the terms of, any contract, service agreement,
commitment or arrangement with any director or senior executive of
any member of the Wider Britvic Group save as agreed by A.G.
Barr;
(viii) proposed, agreed to provide or modified the terms of any
share option scheme, incentive scheme or other benefit relating to
the employment or termination of employment of any employee of the
Wider Britvic Group save as agreed by A.G. Barr;
(ix) purchased, redeemed or repaid or announced any proposal to
purchase, redeem or repay any of its own shares or other securities
or reduced or, except in respect of the matters mentioned in
sub-paragraph (i) above, made any other change to any part of its
share capital, save as agreed by A.G. Barr;
(x) waived, compromised or settled any claim (other than in the
ordinary course of business) which is material in the context of
the Wider Britvic Group taken as a whole;
(xi) terminated or varied the terms of any agreement or
arrangement between any member of the Wider Britvic Group and any
other person in a manner which would have a material adverse effect
on the financial position of the Wider Britvic Group taken as a
whole;
(xii) other than pursuant to the Merger and as envisaged in
accordance with the terms of the Scheme, made any alteration to its
memorandum or articles of association or other incorporation
documents in each case which is material in the context of the
Merger;
(xiii) except in relation to changes made or agreed as a result
of, or arising from, changes to legislation, made or agreed or
consented to any change to the terms of the trust deeds and rules
constituting the pension scheme(s) established for its directors,
employees or their dependants or any material change to the
benefits which accrue, or to the pensions which are payable,
thereunder, or to the basis on which qualification for, or accrual
or entitlement to, such benefits or pensions are calculated or
determined or to the basis upon which the liabilities (including
pensions) of such pension schemes are funded or made, or agreed or
consented to, in each case which is material in the context of the
Wider Britvic Group taken as a whole;
(xiv) been unable, or admitted in writing that it is unable, to
pay its debts or commenced negotiations with one or more of its
creditors with a view to rescheduling or restructuring any of its
indebtedness, or having stopped or suspended (or threatened to stop
or suspend) payment of its debts generally or ceased or threatened
to cease carrying on all or a substantial part of its business, in
each case which is material in the context of the Wider Britvic
Group taken as a whole;
(xv) (other than in respect of a member of the Wider Britvic
Group which is dormant and was solvent at the relevant time) taken
or proposed any steps, corporate action or had any legal
proceedings instituted or threatened against it in relation to the
suspension of payments, a moratorium of any indebtedness, its
winding-up (voluntary or otherwise), dissolution, reorganisation or
for the appointment of a receiver, administrator, manager,
administrative receiver, trustee or similar officer of all or any
material part of its assets or revenues or any analogous or
equivalent steps or proceedings in any jurisdiction or appointed
any analogous person in any jurisdiction or had any such person
appointed, in each case which is material in the context of the
Wider Britvic Group taken as a whole;
(xvi) (except for transactions between Britvic and its wholly
owned subsidiaries or between the wholly owned subsidiaries of
Britvic) made, authorised, proposed or announced an intention to
propose any change in its loan capital, in each case which is
material in the context of the Wider Britvic Group taken as a
whole;
(xvii) entered into, implemented or authorised the entry into,
any joint venture, asset or profit sharing arrangement, partnership
or merger of business or corporate entities, in each case which is
material in the context of the Wider Britvic Group taken as a
whole;
(xviii) entered into any licence or other disposal of
intellectual property rights of any member of the Wider Britvic
Group which are material in the context of the Wider Britvic Group
and outside the normal course of business; or
(xix) entered into any agreement, arrangement, commitment or
contract or passed any resolution or made any offer (which remains
open for acceptance) with respect to or announced an intention to,
or to propose to, effect any of the transactions, matters or events
referred to in this Condition (g);
No adverse change, litigation, regulatory enquiry or similar
(h) except as Disclosed, since 2 October 2011 there having been:
(i) no adverse change and no circumstance having arisen which
would or might be reasonably expected to result in any adverse
change in, the business, assets, financial or trading position or
profits or prospects or operational performance of any member of
the Wider Britvic Group which in any case is material in the
context of the Wider Britvic Group taken as a whole;
(ii) no litigation, arbitration proceedings, prosecution or
other legal proceedings (including, without limitation, with regard
to intellectual property rights owned or used by the Wider Britvic
Group) having been threatened, announced or instituted by or
against or remaining outstanding against or in respect of, any
member of the Wider Britvic Group or to which any member of the
Wider Britvic Group is or may become a party (whether as claimant,
defendant or otherwise), in each case which might reasonably be
expected to have a material adverse effect on the Wider Britvic
Group taken as a whole or in the context of the Merger;
(iii) no enquiry, review or investigation by, or complaint or
reference to, any Third Party against or in respect of any member
of the Wider Britvic Group having been threatened, announced or
instituted or remaining outstanding by, against or in respect of
any member of the Wider Britvic Group, in each case which might
reasonably be expected to have a material adverse effect on the
Wider Britvic Group taken as a whole or in the context of the
Merger;
(iv) no contingent or other liability having arisen or become
apparent to A.G. Barr or increased other than in the ordinary
course of business which would or might reasonably be expected to
adversely affect the business, assets, financial or trading
position or profits or prospects of any member of the Wider Britvic
Group to an extent which is material in the context of the Wider
Britvic Group taken as a whole or in the context of the Merger;
and
(v) no steps having been taken and no omissions having been made
which are likely to result in the withdrawal, cancellation,
termination or modification of any licence held by any member of
the Wider Britvic Group which is necessary for the proper carrying
on of its business and the withdrawal, cancellation, termination or
modification of which might reasonably be expected to have a
material adverse effect on the Wider Britvic Group taken as a whole
or in the context of the Merger;
No discovery of certain matters regarding information,
liabilities and environmental issues
(i) except as Disclosed, A.G. Barr not having discovered:
(i) that any financial, business or other information concerning
the Wider Britvic Group publicly announced prior to the date of
this announcement or disclosed at any time to any member of the
Wider A.G. Barr Group or to any of their advisers by or on behalf
of any member of the Wider Britvic Group prior to the date of this
announcement is misleading, contains a misrepresentation of any
fact, or omits to state a fact necessary to make that information
not misleading, to an extent which in any such case is material in
the context of the Wider Britvic Group taken as a whole;
(ii) that any member of the Wider Britvic Group or any
partnership, company or other entity in which any member of the
Wider Britvic Group has a significant economic interest and which
is not a subsidiary undertaking of Britvic is, otherwise than in
the ordinary course of business, subject to any liability,
contingent or otherwise and which is material in the context of the
Wider Britvic Group taken as a whole or in the context of the
Merger;
(iii) that any past or present member of the Wider Britvic Group
has not complied in any material respect with all applicable
legislation, regulations or other requirements of any jurisdiction
or any Authorisations relating to the use, treatment, storage,
carriage, disposal, discharge, spillage, release, leak or emission
of any waste or hazardous substance or any substance likely to
impair the environment (including any property) or harm human or
animal health or otherwise relating to environmental matters or the
health and safety of humans, which non-compliance would be likely
to give rise to any liability including any penalty for
non-compliance (whether actual or contingent) on the part of any
member of the Wider Britvic Group which in any case is material in
the context of the Wider Britvic Group taken as a whole;
(iv) that there has been a material disposal, discharge,
spillage, accumulation, release, leak, emission or the migration,
production, supply, treatment, storage, transport or use of any
waste or hazardous substance or any substance likely to impair the
environment (including any property) or harm human or animal health
which (whether or not giving rise to non-compliance with any law or
regulation), would be likely to give rise to any liability (whether
actual or contingent) on the part of any member of the Wider
Britvic Group which in any case is material in the context of the
Wider Britvic Group taken as a whole;
(v) that there is or is reasonably likely to be any obligation
or liability (whether actual or contingent) or requirement to make
good, remediate, repair, reinstate or clean up any property, asset
or any controlled waters currently or previously owned, occupied,
operated or made use of or controlled by any past or present member
of the Wider Britvic Group (or on its behalf), or in which any such
member may have or previously have had or be deemed to have had an
interest, under any environmental legislation, common law,
regulation, notice, circular, Authorisation or order of any Third
Party in any jurisdiction or to contribute to the cost thereof or
associated therewith or indemnify any person in relation thereto
which in any case is material in the context of the Wider Britvic
Group taken as a whole;
(vi) that circumstances exist (whether as a result of making the
Merger or otherwise) which would be reasonably likely to lead to
any Third Party instituting (or whereby any member of the Wider
Britvic Group would be likely to be required to institute) an
environmental audit or take any steps which would in any such case
be reasonably likely to result in any actual or contingent
liability to improve or install new plant or equipment or to make
good, repair, reinstate or clean up any property of any description
or any asset now or previously owned, occupied or made use of by
any past or present member of the Wider Britvic Group (or on its
behalf) or by any person for which a member of the Wider Britvic
Group is or has been responsible, or in which any such member may
have or previously have had or be deemed to have had an interest,
which in any case is material in the context of the Wider Britvic
Group taken as a whole; or
(vii) that circumstances exist whereby a person or class of
persons have or is reasonably likely to have any legitimate claim
or claims in respect of any product or process, or materials used
therein, now or previously manufactured, sold, supplied or carried
out by any past or present member of the Wider Britvic Group which
in each case is material in the context of the Wider Britvic Group
taken as a whole.
B. CERTAIN FURTHER TERMS OF THE SCHEME AND THE MERGER
Subject to the requirements of the Panel and, in the case of
Condition 3(c), Britvic's prior written consent, A.G. Barr reserves
the right to waive, in whole or in part, all or any of the above
Conditions 3(c) to (i) (inclusive).
The Scheme will not become effective unless the Conditions have
been fulfilled or (if capable of waiver) waived or, where
appropriate, have been determined by A.G. Barr to be or remain
satisfied by no later than the date referred to in Condition 1 (or
such later date as A.G. Barr and Britvic may agree and (if
required) the Panel and the Court may allow).
If A.G. Barr is required by the Panel to make an offer for
Britvic Shares under the provisions of Rule 9 of the Code, A.G.
Barr may make such alterations to any of the above Conditions and
terms of the Merger as are necessary to comply with the provisions
of that Rule.
A.G. Barr shall be under no obligation to waive (if capable of
waiver), to determine to be or remain satisfied or to treat as
fulfilled any of Conditions 3(c) to (i) (inclusive) by a date
earlier than the latest date for the fulfilment of that Condition
notwithstanding that the other Conditions of the Merger may at such
earlier date have been waived or fulfilled and that there are at
such earlier date no circumstances indicating that any of such
Conditions may not be capable of fulfilment.
A.G. Barr reserves the right to elect, with the consent of the
Panel and with Britvic's prior written consent (such consent, for
the avoidance of doubt, to also be required in the case of any
offer to be made by A.G. Barr in the event Condition 3(c) is not
satisfied), to implement the Merger by way of a Merger Offer. In
such event, the acquisition will be implemented on substantially
the same terms subject to appropriate amendments (including,
without limitation, an acceptance condition set at 90 per cent. (or
such lesser percentage being more than 50 per cent. as A.G. Barr
may decide) of the shares to which the Merger Offer relates and of
the voting rights carried by those shares), so far as applicable,
as those which would apply to the Scheme.
The Merger will lapse and the Scheme will not proceed if the OFT
refers the Merger or any part of it to the Competition Commission
before the date of the Court Meeting. In such event, neither A.G.
Barr, Britvic nor Britvic Shareholders will be bound by any term of
the Scheme.
The availability of the Merger to persons not resident in the
United Kingdom may be affected by the laws of the relevant
jurisdictions. Persons who are not resident in the United Kingdom
should inform themselves about and observe any applicable
requirements.
The Merger is not being made, directly or indirectly, in, into
or from, or by use of the mails of, or by any means of
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 jurisdiction where to do so would
violate the laws of that jurisdiction.
Under Rule 13.5 of the Code, A.G. Barr may not invoke a
condition to the Merger so as to cause the Merger not to proceed,
to lapse or to be withdrawn unless the circumstances which give
rise to the right to invoke the condition are of material
significance to A.G. Barr in the context of the Merger. The
conditions contained in paragraphs 1, 2 and 3(a), (b) and (c) of
Part A are not subject to this provision of the Code.
Fractions of New A.G. Barr Shares will not be allotted or issued
to Britvic Shareholders pursuant to the Scheme. Fractional
entitlements to New A.G. Barr Shares will be rounded down to the
nearest whole number of New A.G. Barr Shares.
If the Scheme becomes effective, the new Britvic shares to be
issued pursuant to the Scheme will be acquired by A.G. Barr fully
paid and free from all liens, charges, equitable interests,
encumbrances, rights of pre-emption and any other rights and
interests of any nature whatsoever and together with all rights now
and hereafter attaching thereto, including voting rights and, save
as referred to below, the right to receive and retain in full all
dividends and other distributions (if any) declared, made or paid
on or after the Effective Date. Under the terms of the Merger, each
Britvic Shareholder will forgo all rights to any future dividend or
undeclared dividends or other return of capital of Britvic (other
than the second interim dividend in relation to the financial year
ended 30 September 2012 of up to 12.4p per share and the special
interim dividend of up to 10.0p per share in relation to the period
from 1 October 2012 to the Effective Date (as described in section
10 (Dividends and dividend policy) of this announcement)).
The Merger and the Scheme will be governed by the law of England
and Wales and will be subject to the jurisdiction of the English
courts and to the Conditions and further terms set out in this
Appendix 1 and to be set out in the Scheme Document. The Scheme
will be subject to applicable requirements of the Code, the Panel,
the London Stock Exchange, the FSA and the UK Listing
Authority.
APPENDIX 2
BASES AND SOURCES
(a) For the purposes of the financial comparisons contained in
this announcement, no account has been taken of any liability to
taxation or the treatment of fractions under the Merger.
(b) Unless otherwise stated, the financial information on A.G.
Barr contained in this announcement is extracted or derived
(without material adjustment) from the audited consolidated annual
report and accounts for the A.G. Barr Group for the 52 weeks ended
28 January 2012.
(c) Unless otherwise stated, the financial information on
Britvic contained in this announcement is extracted or derived
(without material adjustment) from the audited consolidated annual
report and accounts for the Britvic Group for the 52 weeks ended 2
October 2011.
(d) The market prices of the A.G. Barr Shares and the Britvic
Shares are the closing middle market quotations as derived from the
Daily Official List.
(e) As at the close of business on 13 November 2012 (being the
latest practicable date prior to the date of this announcement)
there were 116,768,778 A.G. Barr Shares in issue. The International
Securities Identification Number for A.G. Barr Shares is
GB00B6XZKY75.
(f) As at the close of business on 13 November 2012 (being the
latest practicable date prior to the date of this announcement)
there were 242,344,551 Britvic Shares in issue. The International
Securities Identification Number for Britvic Shares is
GB00B0N8QD54.
(g) The value of 352.7 pence per Britvic Share implied by the
terms of the Merger is calculated based on the exchange ratio of
0.816 New A.G. Barr Shares for each Britvic Share held and the
closing price per A.G. Barr Share of 432.2 pence on 13 November
2012 (being the latest practicable date prior to the date of this
announcement).
(h) The value of approximately GBP855 million for Britvic's
issued share capital implied by the terms of the Merger is
calculated on the basis of the value placed on each Britvic Share
referred to in paragraph (g) above multiplied by the number of
Britvic Shares referred to in paragraph (f) above.
(i) Synergy numbers are unaudited and are based on analysis by
A.G. Barr's and Britvic's management and on A.G. Barr's and
Britvic's internal records.
APPENDIX 3
DETAILS OF IRREVOCABLE UNDERTAKINGS
Irrevocable undertakings in respect of Britvic Shares
The following persons have given irrevocable undertakings to
vote in favour of the Scheme at the Court Meeting and the
resolutions to be proposed at the Britvic General Meeting in
relation to the following Britvic Shares:
Name Number of Britvic Percentage of issued
Shares ordinary share capital
of Britvic
------------------ ------------------ ------------------------
Susan Moody 434,042 0.179
------------------ ------------------ ------------------------
John Gibney 373,480 0.154
------------------ ------------------ ------------------------
Virginia Corbett 103,695 0.043
------------------ ------------------ ------------------------
Michael Shallow 21,739 0.009
------------------ ------------------ ------------------------
Joanne Averiss 14,696 0.006
------------------ ------------------ ------------------------
Ben Gordon 11,393 0.005
------------------ ------------------ ------------------------
Paul Moody 11,044 0.005
------------------ ------------------ ------------------------
Bob Ivell 10,870 0.004
------------------ ------------------ ------------------------
TOTAL 980,959 0.40
------------------ ------------------ ------------------------
The undertakings shall only lapse if the Scheme Document (or, if
A.G. Barr elects to implement the Merger by way of a Merger Offer,
the offer document relating to the Merger Offer) is not published
within 28 days of the date of this announcement (or such later date
as the Panel may agree); or the Scheme (or Merger Offer, as
applicable) does not become effective or lapses in accordance with
its terms; or A.G. Barr announces, with the consent of the Panel,
that it does not intend to proceed with the Merger (whether by
Scheme or Merger Offer), the Scheme is withdrawn or any competing
offer for Britvic is made which is declared wholly unconditional or
otherwise becomes effective.
Irrevocable undertakings in respect of A.G. Barr Shares
The following persons have given irrevocable undertakings to
vote in favour of the resolution to be proposed at the A.G. Barr
General Meeting to approve the Merger and related resolutions to be
proposed at the A.G. Barr General Meeting in relation to the
following A.G. Barr Shares:
Name Number of A.G. Barr Percentage of issued
Shares ordinary share capital
of A.G. Barr
----------------------------- -------------------- ------------------------
William Robin Graham
Barr 6,033,876 5.17
----------------------------- -------------------- ------------------------
Robert Barr's Charitable
Trust 5,400,000 4.62
----------------------------- -------------------- ------------------------
Robert Barr's Trust 2,247,858 1.93
----------------------------- -------------------- ------------------------
Patrick Graham Barr 1,677,648 1.44
----------------------------- -------------------- ------------------------
Julie Anne Barr 1,643,457 1.41
----------------------------- -------------------- ------------------------
Caroline J. Muir 1,614,504 1.38
----------------------------- -------------------- ------------------------
Heather Jean Barr 1,482,450 1.27
----------------------------- -------------------- ------------------------
Mrs D. K. Barr Testamentary
Trust 1,080,600 0.93
----------------------------- -------------------- ------------------------
Mrs Heather J. Barr
Discretionary Trust 761,100 0.65
----------------------------- -------------------- ------------------------
W. Robin G. Barr
Family Trust 456,510 0.39
----------------------------- -------------------- ------------------------
Carol White 325,944 0.28
----------------------------- -------------------- ------------------------
Ronald Hanna 150,000 0.13
----------------------------- -------------------- ------------------------
Melanie Kemp 125,616 0.11
----------------------------- -------------------- ------------------------
W.R.G. Barr Trust
for Children 83,940 0.07
----------------------------- -------------------- ------------------------
Robert Barr 1985
Trust 72,900 0.06
----------------------------- -------------------- ------------------------
Susan Memmott 66,606 0.06
----------------------------- -------------------- ------------------------
Ellen Short 52,311 0.04
----------------------------- -------------------- ------------------------
Martin Griffiths 5,400 0.005
----------------------------- -------------------- ------------------------
Andrew Memmott 600 0.0005
----------------------------- -------------------- ------------------------
TOTAL 23,281,320 19.94
----------------------------- -------------------- ------------------------
The undertakings shall only lapse if the Scheme Document (or, if
A.G. Barr elects to implement the Merger by way of a Merger Offer,
the offer document relating to the Merger Offer) is not published
within 28 days of the date of this announcement (or such later date
as the Panel may agree); or the Scheme (or Merger Offer, as
applicable) does not become effective or lapses in accordance with
its terms; or A.G. Barr announces, with the consent of the Panel,
that it does not intend to proceed with the Merger (whether by
Scheme or Merger Offer), the Scheme is withdrawn or any competing
offer for Britvic is made which is declared wholly unconditional or
otherwise becomes effective.
APPENDIX 4
BRITVIC PROFIT ESTIMATE
Section A: Britvic Profit Estimate
1. Introduction
On 11 July 2012, Britvic released an update statement on the
Robinsons Fruit Shoot and Fruit Shoot Hydro product recall which
was announced on 3 July 2012. In this update statement it was
stated that:
"We believe this will now have an impact on the group profit
before tax in the region of GBP15m to GBP25m across the current and
next financial year. This includes an anticipated impact in 2013
financial year of between GBP5m and GBP7m."
The update statement also said:
"In May we reported that the UK soft drinks market and our
trading had been adversely affected by poor weather conditions and
weak consumer sentiment. Since then trading conditions have not
improved and the group now expects to deliver a result for the
current financial year that is at the bottom end of market
expectations, before taking account of the impact of the Fruit
Shoot recall."
Further to that, in the Q3 Interim Management Statement
announced on 19 July 2012, Britvic reiterated this guidance:
"...As announced last week, these events caused us to re-set our
expectations for the full year and our guidance remains
unchanged."
At the time of these statements, the Britvic Directors
considered that the bottom end of market expectations for the
operating profit for the 2012 financial year was GBP129m based on
the low end of 16 brokers' forecasts given prior to the Fruit Shoot
recall announcement on 3 July 2012. As a result, the estimated
impact of GBP10m to GBP18m for the 2012 financial year from the
Robinsons Fruit Shoot and Fruit Shoot Hydro product recall implies
that the Britvic Group's operating profit for 2012 will be in the
range of GBP111m to GBP119m. The statements above continue to be
unchanged and the Britvic Directors estimate that the full year
operating profit of Britvic for 2012 will be towards the lower end
of this range indicated (together with the statements above, the
"Britvic Profit Estimate").
The Britvic Profit Estimate is a profit forecast for the
purposes of Rule 28 of the Code. As such it is a requirement under
the Code that the Britvic Profit Estimate be reported on by
Britvic's reporting accountants and financial advisers. The bases
behind the Britvic Profit Estimate and the reports of Ernst &
Young LLP and Citigroup Global Markets Limited are set out below.
Ernst & Young LLP and Citigroup Global Markets Limited have
given and not withdrawn their consent to the publication of their
reports in the form and context in which they are included in this
announcement.
The Britvic Profit Estimate is not based on profit before tax
because the guidance approved by the Britvic Directors and given to
the market at the time these statements were made was at the level
of operating profit. The market expectations referred to in the
Britvic Profit Estimate were therefore a reference to the Britvic
Group's operating profit as opposed to profit before tax. The
Britvic Directors consider operating profit to be a more
appropriate measure of the Britvic Group's underlying performance,
as it excludes ongoing finance charges and items of a one-off
nature outside of management's control.
For clarification, operating profit is the Britvic Group's
profits for the period attributable to the equity shareholders
before adjusting for:
-- exceptional and other items which are all one off in nature,
except for the movement in the fair value of derivative financial
instruments where hedge accounting cannot be applied;
-- finance costs; and
-- taxation.
The Britvic Profit Estimate is for the full year to 30 September
2012. In accordance with Rule 28.8 of the Code, your attention is
drawn to the Britvic interim results for the 28 weeks ended 15
April 2012, when Britvic made operating profit of GBP40m (2011:
GBP44m).
2. Basis of preparation
The Britvic Profit Estimate is based on the unaudited interim
financial results of the Britvic Group for the 28 weeks ended 15
April 2012 and the unaudited management accounts for the 24 weeks
ended 30 September 2012 and has been prepared on a basis consistent
with the accounting policies that are expected to be used in the
Britvic Group's consolidated financial statements for the year
ended 30 September 2012.
The Britvic Profit Estimate has been prepared on the basis
that:
-- No events will arise between the date of this announcement
and the date on which Britvic announces its audited results for
2012 which would require incorporation in the 2012 results in
accordance with the Britvic Group's accounting policies under IFRS;
and
-- There will be no retrospective change in legislation or
regulatory requirements that will have a material impact on the
Britvic Group's operations.
Section B: Accountant's report in relation to the Britvic Profit
Estimate
The Directors 14 November 2012
Britvic plc
Breakspear Park
Breakspear Way
Hemel Hempstead
Hertfordshire
HP2 4TZ
Citigroup Global Markets Limited
33 Canada Square
Canary Wharf
London
E14 5LB
Dear Sirs
We report on the profit estimate comprising the operating profit
of Britvic plc ("Britvic") and its subsidiaries (together the
"Britvic Group") for the 52 weeks ended 30 September 2012 (the
"Profit Estimate"). The Profit Estimate and the basis on which it
is prepared is set out in Section A of Appendix 4 of the
announcement (the "Announcement") issued by Britvic and A.G. BARR
p.l.c. ("A.G. Barr") dated 14 November 2012. This report is
required by Rules 28.3(b) and 28.4 of The City Code on Takeovers
and Mergers (the "Code") and is given for the purpose of complying
with those Rules and for no other purpose. Accordingly we assume no
responsibility in respect of this report to A.G. Barr or any person
connected to, or acting in concert with, A. G. Barr or to any other
person who is seeking or may in the future seek to acquire control
of Britvic (an "Alternative Offeror") or to any other person
connected to, or acting in concert with, an Alternative
Offeror.
Responsibilities
It is the responsibility of the directors of Britvic to prepare
the Profit Estimate in accordance with the requirements of the
Code. In preparing the Profit Estimate the directors of Britvic are
responsible for correcting errors that they have identified which
may have arisen in unaudited financial results and unaudited
management accounts used as the basis of preparation for the Profit
Estimate.
It is our responsibility to form an opinion as required by the
Code as to the proper compilation of the Profit Estimate and to
report that opinion to you.
The UK firm Ernst & Young LLP is a limited liability
partnership registered in England and Wales with registered number
OC300001 and is a member firm of Ernst & Young Global Limited.
A list of members' names is available for inspection at 1 More
London Place, London SE1 2AF, the firm's principal place of
business and registered office.
Basis of preparation of the Profit Estimate
The Profit Estimate has been prepared on the basis stated in
Section A of Appendix 4 of the Announcement and is based on the
unaudited interim results for the 28 weeks ended 15 April 2012 and
unaudited management accounts for the 24 weeks ended 30 September
2012. The Profit Estimate is required to be presented on a basis
consistent with the accounting policies of the Britvic Group.
Basis of opinion
We conducted our work in accordance with Standards for
Investment Reporting issued by the Auditing Practices Board in the
United Kingdom. Our work included evaluating the basis on which the
historical financial information included in the Profit Estimate
has been prepared and considering whether the Profit Estimate has
been accurately computed using that information and whether the
basis of accounting used is consistent with the accounting policies
of the Britvic Group.
We planned and performed our work so as to obtain the
information and explanations we considered necessary in order to
provide us with reasonable assurance that the Profit Estimate has
been properly compiled on the basis stated.
However, the Profit Estimate has not been audited. The actual
results reported, therefore, may be affected by revisions required
to accounting estimates due to changes in circumstances, the impact
of unforeseen events and the correction of errors in the interim
financial results or management accounts. Consequently we can
express no opinion as to whether the actual results achieved will
correspond to those shown in the Profit Estimate and the difference
may be material.
Our work has not been carried out in accordance with auditing or
other standards and practices generally accepted in the United
States of America or other jurisdictions and accordingly should not
be relied upon as if it had been carried out in accordance with
those standards and practices.
Opinion
In our opinion, the Profit Estimate has been properly compiled
on the basis stated and the basis of accounting used is consistent
with the accounting policies of the Britvic Group.
Yours faithfully
Ernst & Young LLP
United Kingdom
Click on, or paste the following link into your web browser, to
view the associated PDF document.
http://www.rns-pdf.londonstockexchange.com/rns/0560R_1-2012-11-14.pdf
Section C: Financial Adviser's report in relation to the Britvic
Profit Estimate
Citigroup Centre
Canada Square
Canary Wharf
London E14 5LB
United Kingdom
Tel +44 (0) 20 7986 4000
Fax +44 (0) 20 7986 2266
The Directors
Britvic plc
Breakspear Park
Breakspear Way
Hemel Hempstead
Hertfordshire
HP2 4TZ
14 November 2012
Dear Sirs
Report in connection with the profit estimate of Britvic plc
We refer to the statements comprising the estimated operating
profit of Britvic plc ("Britvic") and its subsidiaries (together,
the "Britvic Group") for the year ended 30 September 2012 (the
"Profit Estimate"). The Profit Estimate and the basis on which it
is prepared are set out in Appendix 4 of the announcement of the
proposed merger of Britvic and A.G. Barr p.l.c. issued by Britvic
and A.G. Barr p.l.c. dated 14 November 2012 (the
"Announcement").
We have discussed the Profit Estimate, together with the bases
upon which it has been made, with you. We have also discussed the
accounting policies and bases of calculation for the Profit
Estimate with Ernst & Young LLP and have considered the letter
of today's date addressed to you and to us from Ernst & Young
LLP on these matters. We have relied upon the accuracy and
completeness of all the financial and other information provided to
us by Britvic, or otherwise discussed with us, and we have assumed
such accuracy and completeness for the purposes of providing this
letter.
On the basis of the foregoing, we consider that the Profit
Estimate, for which you, as directors of Britvic are solely
responsible, has been compiled with due care and consideration by
the directors of Britvic.
This report is provided to you solely in connection with Rules
28.3(b) and 28.4 of the City Code on Takeovers and Mergers and for
no other purpose. No person other than the directors of Britvic can
rely on the contents of this letter and to the fullest extent
permitted by law, we exclude all liability to any other person, in
respect of this letter or the work undertaken in connection with
this letter.
Yours faithfully
Jan Skarbek
Managing Director
Citigroup Global Markets Limited
APPENDIX 5
DEFINITIONS
The following definitions apply throughout this announcement
unless the context requires otherwise.
"GBP", "GBP", "Sterling", the lawful currency of the UK
"pence" or "p"
"Admission" the New A.G. Barr Shares being admitted
to the premium listing segment of
the Official List and to trading
on the London Stock Exchange's main
market for listed securities
"A.G. Barr" A.G. BARR p.l.c.
"A.G. Barr Circular" the circular to be sent to A.G. Barr
Shareholders in connection with the
Merger
"A.G. Barr Directors" the board of directors of A.G. Barr
at the date of this announcement
"A.G. Barr General Meeting" the general meeting of A.G. Barr
to be convened in connection with
the Merger, notice of which will
be set out in the A.G. Barr Circular
(including any adjournment thereof)
"A.G. Barr Group" A.G. Barr, its subsidiaries and subsidiary
undertakings from time to time (excluding,
for the avoidance of doubt, the Britvic
Group)
"A.G. Barr Prospectus" the prospectus to be published by
A.G. Barr in connection with the
issue of the New A.G. Barr Shares
"A.G. Barr Shareholders" holders of A.G. Barr Shares
"A.G. Barr Shares" fully paid-up ordinary shares of
4 (1) /(6) pence each in the capital
of A.G. Barr
"Australia" the Commonwealth of Australia, its
territories and possessions
"Authorisations" material authorisations, orders,
recognitions, grants, consents, clearances,
confirmations, certificates, licences,
permissions and approvals
"Britvic" Britvic plc
"Britvic ADSs" American Depositary Shares representing
Britvic Shares
"Britvic Directors" the board of directors of Britvic
at the date of this announcement
"Britvic General Meeting" the general meeting of Britvic to
be convened in connection with the
Scheme and the Reduction of Capital,
notice of which will be set out in
the Scheme Document, including any
adjournment thereof
"Britvic Group" Britvic, its subsidiaries and subsidiary
undertakings from time to time
"Britvic Profit Estimate" those statements made by Britvic
referred to in, and as reported on
by Ernst & Young LLP and Citigroup
Global Markets Limited in, Appendix
4 of this announcement and as otherwise
referred to or reproduced elsewhere
in this announcement
"Britvic Shareholders" holders of Britvic Shares
"Britvic Shares" fully paid-up ordinary shares of
20 pence each in the capital of Britvic
"Britvic Share Schemes" the Britvic Executive Share Option
Scheme, the Britvic Performance Share
Plan and the Britvic Share Incentive
Plan, each as amended from time to
time
"business day" a day on which the London Stock Exchange
is open for business
"Canada" Canada, its provinces and territories
and all areas under its jurisdiction
and political sub-divisions thereof
"Code" the City Code on Takeovers and Mergers
published by the Panel
"Combined Entity" the ultimate parent company of the
Combined Group, which upon the Merger
becoming Effective will be A.G. Barr
(proposed to be renamed as "Barr
Britvic Soft Drinks plc")
"Combined Group" the combined group following the
Merger, comprising the A.G. Barr
Group and the Britvic Group
"Companies Act" the Companies Act 2006, as amended
from time to time
"Competition Commission" the independent public body which
conducts second phase in-depth inquiries
into mergers, markets and the regulation
of the major regulated industries
in the United Kingdom (or any successor
body or bodies carrying out the same
functions in the United Kingdom from
time to time)
"Conditions" the conditions to the implementation
of the Merger (including the Scheme)
as set out in Appendix 1 to this
announcement and to be set out in
the Scheme Document
"Confidentiality Agreement" the mutual confidentiality agreement
entered into by A.G. Barr and Britvic
dated 24 August 2012
"Co-operation Agreement" the co-operation agreement entered
into by A.G. Barr and Britvic dated
the date of this announcement
"Court" the High Court of Justice in England
and Wales
"Court Hearing" the hearing by the Court to sanction
the Scheme and to confirm the Reduction
of Capital
"Court Meeting" the meeting(s) of the Britvic Shareholders
to be convened by order of the Court
pursuant to section 896 of the Companies
Act, notice of which will be set
out in the Scheme Document, for the
purpose of approving the Scheme,
including any adjournment thereof
"Court Order" the order of the Court sanctioning
the Scheme and confirming the Reduction
of Capital
"CREST" the relevant system (as defined in
the Uncertificated Securities Regulations
2001 (SI 2001/3755)) in respect of
which Euroclear UK & Ireland Limited
is the operator (as defined in such
Regulations) in accordance with which
securities may be held and transferred
in uncertificated form
"Daily Official List" the daily official list of the London
Stock Exchange
"Dealing Disclosure" an announcement pursuant to Rule
8 of the Code containing details
of dealings in interests in relevant
securities of a party to an offer
"Disclosed" (i) disclosed in the annual report
and accounts for Britvic for the
period ended 2 October 2011, (ii)
Publicly Announced, (iii) disclosed
in this announcement, or (iv) fairly
disclosed to A.G. Barr, its officers
or employees, or its financial, legal
or accounting advisers (specifically
in their capacity as A.G. Barr's
advisers in relation to the Merger)
by or on behalf of Britvic prior
to the date of this announcement
"Effective" in the context of the Merger:
(a) if the Merger is implemented
by way of the Scheme, the Scheme
having become effective pursuant
to its terms; or
(b) if the Merger is implemented
by way of a Merger Offer, such Merger
Offer having been declared and become
unconditional in all respects in
accordance with the requirements
of the Code
"Effective Date" the date upon which the Merger becomes
Effective
"Forms of Proxy" the form of proxy in connection with
each of the Court Meeting and the
Britvic General Meeting, which shall
accompany the Scheme Document
"FSA" the Financial Services Authority
"GB" Great Britain
"IFRS" International Financial Reporting
Standards, as adopted by the European
Union
"Ireland" the Republic of Ireland and Northern
Ireland
"Japan" Japan, its cities, prefectures, territories
and possessions
"Listing Rules" the rules and regulations made by
the UK Listing Authority under Part
VI of the Financial Services and
Markets Act 2000 (as amended), and
contained in the UK Listing Authority's
publication of the same name (as
amended from time to time)
"London Stock Exchange" London Stock Exchange plc
"Long Stop Date" 30 June 2013 (or such later date
as A.G. Barr and Britvic may agree)
"Merger" the acquisition of the entire issued
and to be issued share capital of
Britvic by A.G. Barr to be implemented
by way of the Scheme or (should A.G.
Barr so elect, subject to the consent
of the Panel and Britvic's prior
written consent) by way of a Merger
Offer
"Merger Offer" the implementation of the Merger
by means of a takeover offer under
section 974 of the Companies Act,
rather than by means of the Scheme
"New A.G. Barr Shares" the new A.G. Barr Shares to be issued
and credited as fully paid to Britvic
Shareholders pursuant to the Merger
"Official List" the official list of the UK Listing
Authority
"OFT" the Office of Fair Trading of the
United Kingdom (or any successor
authority or authorities carrying
out consumer credit regulatory and/or
competition law and merger control
enforcement functions in the United
Kingdom from time to time)
"Opening Position Disclosure" an announcement pursuant to Rule
8 of the Code containing details
of certain persons' interests in
relevant securities of a party to
an offer
"Panel" the Panel on Takeovers and Mergers
"Prospectus Rules" the prospectus rules made by the
FSA under Part VI of the Financial
Services and Markets Act 2000 (as
amended)
"Publicly Announced" specifically disclosed in any public
announcement by Britvic to any Regulatory
Information Service including, but
not limited to, the Q1 interim management
statement dated 25 January 2012,
the 2012 interim results dated 24
May 2012, the Q3 interim management
statement dated 19 July 2012 and
the trading update dated 18 October
2012
"Reduction of Capital" the proposed reduction of Britvic's
share capital under Chapter 10 of
Part 17 of the Companies Act, pursuant
to the Scheme
"Registrar of Companies" the Registrar of Companies in England
and Wales
"Regulatory Information any of the services authorised from
Service" time to time by the FSA for the purposes
of disseminating regulatory announcements
"Restricted Jurisdiction" any jurisdiction where local laws
or regulations may result in significant
risk of civil, regulatory or criminal
exposure if information concerning
the Merger is sent or made available
to Britvic Shareholders in that jurisdiction
(in accordance with Rule 30.3 of
the Code)
"Rothschild" N.M. Rothschild & Sons Limited of
New Court, St Swithin's Lane, London
EC4N 8AL
"Scheme" the scheme of arrangement proposed
to be made under Part 26 of the Companies
Act between Britvic and the Britvic
Shareholders in connection with the
Merger, with or subject to any modification,
addition or condition approved or
imposed by the Court and agreed to
by A.G. Barr and Britvic
"Scheme Document" the document to be sent to (among
others) Britvic Shareholders containing
and setting out, among other things,
the full terms and conditions of
the Scheme and containing the notices
convening the Court Meeting and the
Britvic General Meeting
"Scheme Record Time" the time and date specified in the
Scheme Document, expected to be 6.00
p.m. on the business day immediately
prior to the date of the Court Hearing
"Scheme Voting Record the time and date specified in the
Time" Scheme Document by reference to which
entitlement to vote on the Scheme
will be determined
"Special Resolution" the special resolution to be proposed
by Britvic at the Britvic General
Meeting in connection with, among
other things, the approval of the
Scheme and confirmation of the Reduction
of Capital, the alteration of Britvic's
articles of association and such
other matters as may be necessary
to implement the Scheme and the delisting
of the Britvic Shares
"Statement of Capital" the statement of capital (approved
by the Court) showing, with respect
to Britvic's share capital as altered
by the Court Order, the information
required by section 649 of the Companies
Act
"Third Party" a central bank, government or governmental,
quasi-governmental, supranational,
statutory, regulatory, environmental
or investigative body or authority,
court, trade agency, professional
association, institution, employee
representative body or any other
body or person whatsoever in any
jurisdiction
"UK" or "United Kingdom" the United Kingdom of Great Britain
and Northern Ireland
"UK Listing Authority" the FSA acting in its capacity as
the competent authority for listing
under the Financial Services and
Markets Act 2000 (as amended)
"United States of America", the United States of America, its
"United States", "USA" territories and possessions, any
or "US" state of the United States and the
District of Columbia
"US Exchange Act" the US Securities Exchange Act of
1934 and the rules and regulations
promulgated thereunder (as amended)
"US Securities Act" the US Securities Act of 1933 and
the rules and regulations promulgated
thereunder (as amended)
"Wider A.G. Barr Group" A.G. Barr and its subsidiaries, subsidiary
undertakings and associated undertakings
and any other body corporate, partnership,
joint venture or person in which
A.G. Barr and such undertakings (aggregating
their interests) have a direct or
indirect interest of 20 per cent.
or more of the voting or equity capital
or the equivalent
"Wider Britvic Group" Britvic and its subsidiaries, subsidiary
undertakings and associated undertakings
and any other body corporate, partnership,
joint venture or person in which
Britvic and such undertakings (aggregating
their interests) have a direct or
indirect interest of 20 per cent.
or more of the voting or equity capital
or the equivalent
For the purposes of this announcement, "subsidiary", "subsidiary
undertaking", "undertaking" and "associated undertaking" have the
meanings given by the Companies Act.
References to an enactment include references to that enactment
as amended, replaced, consolidated or re-enacted by or under any
other enactment before or after the date of this announcement. All
references to time in this announcement are to London time unless
otherwise stated.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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