DHP Darwen

    RNS Number : 1475X
  Darwen Holdings PLC
  20 June 2008
   


    Darwen announces agreement to acquire the Optare Group, placing to raise �16m and name change to Optare plc
    Darwen Holdings plc (the "Company") today announces that it has conditionally agreed, subject to Existing Shareholder approval, to
acquire the entire share capital of Jamesstan Investments Ltd ("Jamesstan"), the holding company of the Optare Group, for an enterprise
value of �15.95 million. If approved by Existing Shareholders, the transaction will be regarded as a reverse take-over under the AIM Rules.
An admission document in respect of the proposed enlarged company has been published and will be sent to shareholders at 9.00am today.

    In conjunction with the Acquisition and in order to implement the Directors' strategy for the Enlarged Group, the Company is also
announcing that it intends to raise approximately �16 million before expenses, through the issue of 40 million Placing Shares at the Placing
Price of 40p.

    The Directors believe that this is a transformational deal, and the Executive Directors have subscribed to Placing Shares worth �650,000
at the Placing Price, alongside the institutional investors.

    The Directors believe that the proposed acquisition is a compelling strategic fit with the Group for the following reasons: 
    *     Comprehensive product offering
    *     Improved skills including an in-house design capability
    *     Improved after sales ability with national reach
    *     Reduced costs and improved operational performance
    *     Enhanced geographic reach

    Commenting on today's news, Chief Executive Andrew Brian said:

    "Optare, a brand synonymous with top quality service and market-leading products, complements Darwen's existing strong market position;
this deal is fantastic news for our investors and builds on Darwen's strategic progress to date. I am delighted at the level of
institutional support, which endorses the strategy we set out when we floated in February. We are excited about building a stronger and more
competitive business, to capitalise on the opportunity to deliver market-leading hybrid public transport solutions and to deliver great
results for our customers, business partners and employees."

    Historically, Darwen's vehicles have utilised traditional diesel-powered technology. The Directors intend to increase the production and
sales of its existing products through improved manufacturing processes and the strengthening of the sales team. To support this, the
Company intends to invest in new, custom-designed premises, new plant and equipment, and internet and communication infrastructure.

    At the same time, the Directors believe that there is a strong desire from bus operators for a more fuel-efficient, affordable and
higher capacity bus, and a lower emission alternative to the traditional diesel-powered vehicles. The combined product suite of Darwen and
Jamesstan is expected to deliver a complete vehicle solution to its customers, and will have at its core a lightweight, diesel-engined
vehicle with a low emission hybrid variant.

    The Directors believe that growth opportunities for the new group will be fuelled by:
    *     Operators' need to produce fuel economies and reduce costs and carbon emissions
    *     Introduction of Low Emission Zones ("LEZs") and congestion charging, which are driving replacement cycles
    *     Quality incentive contracts, which seek to reduce emissions
    *     Disability Discrimination Act
    *     Demand from operators seeking better integration of manufacturing activities that allow a quicker response to their needs
    *     Demand for hybrid solutions, notably from Transport for London


    Contacts

    Darwen Holdings plc                                         +44 (0) 1254 504150
    Andrew Brian

    Cenkos Securities plc (Nomad and broker)     +44 (0) 20 7397 8900
    Stephen Keys/Camilla Hume

    MC2 (Financial PR)                                           +44 (0) 161 236 1352
    Sarah Lindgreen/Lauren Jones

    Shareholders are informed that an AIM Admission Document has been published and posted today, together with a notice convening a General
Meeting ("GM") of the Company, at which the approval of shareholders will be sought for the proposed acquisition, an increase in the
authorised share capital of the Company, the authority to allot the new ordinary shares pursuant to the proposed acquisition, the placing,
and to change the name of the Company to Optare plc. A copy of the Admission Document is available from the Company's website:
www.darwengroup.com

    EXPECTED TIMETABLE OF PRINCIPAL EVENTS

    
                                                                         2008 
 Record date                                                           20 June
 Latest time and date for receipt of Forms of Proxy for the            11 July
 General Meeting 
 General Meeting                                              11 am on 12 July
 Admission and commencement of dealings in New Ordinary                15 July
 Shares on AIM 
 Where applicable, expected dates for CREST accounts to be             15 July
 credited in respect of the New Ordinary Shares 
 Where applicable, expected date of dispatch of definitive             22 July
 share certificates for New Ordinary Shares by 



    PLACING STATISTICS

    
 Number of Existing Ordinary Shares                                 49,293,145
 Number of Placing Shares                                           40,000,000
 Placing Price per new Ordinary Share                                      40p
 Number of Consideration Shares                                      4,375,000
 Estimated Gross Proceeds of the Placing receivable by       �16 millionllion 
 the Company       
 Estimated net proceeds of the Placing receivable by the           �14,973,000
 Company 
 Market capitalisation of the Company at the Placing       �37.4 millionllion 
 Price at Admission 
 Percentage of Enlarged Share Capital represented by the                 42.7%
 Placing Shares 
 Percentage of Enlarged Share Capital represented by the                 4.7% 
 Consideration Shares  

    Notes to editors 

    About Darwen Holdings
    Darwen Holdings plc ("Darwen") specialises in the design, assembly and supply of single and double deck buses to bus service operators
in the UK, through its subsidiary, Darwen Group Ltd ("Darwen Ltd"). It was admitted to trading on the AIM market in February 2008. 

    Darwen Ltd was established in August 2007 from the business and assets of East Lancashire Coachbuilders Ltd. The company went on to
acquire specialist design, manufacturing and product development consultancy skills with the addition of Leyland Product Developments Ltd
(now known as Darwen LPD), in November 2007. Darwen's Board believes that market demand for high quality, low emission public service
vehicles is growing. In response, Darwen is developing a line of low emission buses, using diesel electric hybrid technology.

    Management includes founder and Chairman, Roy Stanley, and Chief Executive, Andrew Brian. John Fickling is a Non-Executive Director, and
it is proposed that Michael Dunn will join the Board as Chief Financial Officer on completion of the Acquisition.

    www.darwengroup.com 

    About Jamesstan 
    Jamesstan was established in January 2008 to acquire Optare Holdings, whose subsidiaries include Optare Group Ltd. Roy Stanley is the
sole shareholder of Jamesstan.

    About Optare
    Optare is a leading manufacturer of small buses and coaches in the UK. It has three business units: bus manufacture, coach sales and an
after sales service business operating under the Unitec brand. The Optare Group employs 540 people and has an annual turnover of �58
million. It has sites in Leeds, Rotherham, Essex and Glasgow.

    www.optare.com

This information is provided by RNS
The company news service from the London Stock Exchange
 
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