RNS Number:6398N
Gyrus Group PLC
16 June 2005
16 June 2005
NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION IN OR INTO OR FROM THE UNITED
STATES, CANADA, AUSTRALIA, JAPAN, THE REPUBLIC OF IRELAND OR THE REPUBLIC OF
SOUTH AFRICA
PROPOSED ACQUISITION BY GYRUS OF ACMI FOR $497 MILLION (#275 MILLION)
VENDOR PLACING OF 61,560,025 NEW ORDINARY SHARES AT 250P PER SHARE
Gyrus Group PLC (the "Company" or the "Group") today announces the proposed
acquisition of American Cystoscope Makers Inc. ("ACMI"), an established US
medical device company focused on urology and gynaecology, principally owned by
investment funds managed by Fox Paine & Company, LLC, a California-based private
equity firm.
* ACMI was founded in 1904 and was a pioneer in the development of
urological instrumentation and endoscopic equipment. ACMI currently targets four
key areas in the field of minimally invasive surgery: urology; gynaecology;
general surgery; and visualisation.
* In the financial year to 31 December 2004, ACMI achieved sales of
$184.7 million (#102.2 million) and earnings before interest, tax, depreciation
and amortisation, operating exceptional items and adjusted one-off operating
items of $27.0 million (#14.9 million).
* Total consideration of $497 million will comprise consideration of $333
million, together with debt and other obligations to be repaid by Gyrus of $164
million.
* The acquisition will be financed by (i) a Vendor Placing of new Gyrus
ordinary shares to raise #116 million ($209.6 million), net of expenses of the
placing, with institutional investors and a further #34.3 million ($62 million)
to be subscribed by the Seller Placees and (ii) a new $250 million debt facility
to be provided by Bank of Scotland Corporate. The Vendor Placing has been fully
underwritten at 250p per share by Numis Securities and Panmure Gordon, joint
stockbrokers to the Group.
* Gyrus believes that the acquisition will:
- strengthen its competitive position in urology
- create breadth and scale in gynaecology
- provide a platform for expansion into general surgery
* Gyrus expects savings from existing process improvement initiatives
within ACMI and cost synergy benefits to contribute approximately $22 million
(#12.2 million) in pre-tax earnings by the end of the three year period
following the acquisition. The one-off costs of implementing these savings,
which are anticipated to be accounted for across the three year period, are
expected to amount to $33 million (#18.3 million).
* The acquisition is expected to be earnings enhancing in 2006 and for
the foreseeable future, before any non-recurring costs, the amortisation of
intangible assets and any non-cash charges for equity incentive schemes required
under IFRS.
* The acquisition is subject to regulatory and shareholder approval. A
resolution to approve the acquisition will be proposed at an Extraordinary
General Meeting of Gyrus shareholders to be held on 4 July 2005. The
acquisition is expected to be completed by, and dealings in the new ordinary
shares to commence on, 19 July 2005, subject to US anti-trust clearance.
Commenting on today's announcement, Brian Steer, Executive Chairman of Gyrus,
said:
"This transaction transforms Gyrus into a leading global player in the surgical
specialities of ENT, gynaecology and urology. It significantly enhances our
position as a result of the visualisation technologies ACMI brings. These,
combined with Gyrus's proprietary tissue management technology, allow us to meet
the surgeon's need to 'see' and 'treat' in minimally invasive surgery. It
creates a free standing urology division with a dedicated sales force and
provides a portfolio of products to support the Group's expansion into general
surgery. This acquisition builds upon our successful track record of growth in
the US market both organically and by acquisition."
Meeting for Analysts
A meeting for analysts will be held at the offices of Financial Dynamics,
Holborn Gate, 26 Southampton Buildings, London WC2A 1PB today at 8.30am BST.
Please call Mo Noonan on 020 7269 7116 for further details.
Gyrus is being jointly advised by Bear, Stearns International and Numis
Securities on the transaction. Numis is Sponsor to the Transaction and joint
broker to the vendor placing with Panmure Gordon.
This summary should be read in conjunction with the full text of the
announcement.
Enquiries:
Gyrus Group PLC On 16 June 2005
Brian Steer, Executive Chairman Tel: 020 7831 3113
Simon Shaw, Chief Financial Officer
Thereafter
Tel: 0118 921 9750
Numis Securities Tel: 020 7776 1500
Charles Spicer
Chris Wilkinson
Bear, Stearns International Tel: 020 7516 6000
Ian George
Panmure Gordon Tel: 020 7459 3600
Gilbert Ellacombe
Dominic Morley
Financial Dynamics Tel: 020 7831 3113
Ben Atwell
Numis Securities Limited, Bear, Stearns International Limited and Panmure Gordon
(UK) Limited, which are regulated in the United Kingdom by The Financial
Services Authority, are acting exclusively for Gyrus Group PLC (within the
meaning of the Rules of the Financial Services Authority) in connection with the
Vendor Placing and for nobody else. Numis Securities Limited, Bear, Stearns
International Limited and Panmure Gordon (UK) Limited will not be responsible to
anyone other than Gyrus Group PLC for providing the protections afforded to
their respective customers, nor for providing advice in relation to the Vendor
Placing or the contents of this announcement or any matter referred to in this
announcement. Neither the Ordinary Shares nor the Placing Shares have been, or
will be, registered under the United States Securities Act of 1933 (as amended),
or under the securities laws of any state of the United States or any province
or territory of Canada, Australia, Japan, the Republic of Ireland or the
Republic of South Africa. Subject to certain exceptions, the Placing Shares may
not, directly or indirectly, be offered, sold, taken up or delivered in or into
or from the United States, Canada, Australia, Japan, the Republic of Ireland or
the Republic of South Africa or their respective territories or possessions.
This announcement does not constitute an offer to sell or issue or the
solicitation of an offer to buy or subscribe for New Ordinary Shares in any
jurisdiction in which such offer or solicitation is unlawful. Accordingly,
copies of this announcement are not being and must not be mailed or otherwise
distributed or sent in or into or from the United States, Canada, Australia,
Japan, the Republic of Ireland or the Republic of South Africa and any person
receiving this announcement (including custodians, nominees and trustees) must
not distribute or send it in or into or from the United States, Canada,
Australia, Japan or the Republic of Ireland or the Republic of South Africa.
This announcement has not been approved by any of Numis Securities Limited,
Bear, Stearns International Limited and Panmure Gordon (UK) Limited for the
purposes of section 21 of the Financial Services and Markets Act 2000.
For illustrative purposes only, and except as otherwise stated, the exchange
rate of US$1.80705 to #1.00 has been used to translate financial information
into pounds sterling, being the US$/# exchange rate prevailing on 15 June 2005.
NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION IN OR INTO OR FROM THE UNITED
STATES, CANADA, AUSTRALIA, JAPAN, THE REPUBLIC OF IRELAND OR THE REPUBLIC OF
SOUTH AFRICA
INTRODUCTION
Gyrus announced today that the Company has agreed to acquire ACMI. ACMI designs,
manufactures, markets and services surgical systems to be used by surgeons and
physicians primarily for diagnosis and minimally invasive surgery in the fields
of urology and gynaecology.
The Company has agreed to acquire ACMI for a total consideration of $497 million
(#275 million) which will comprise cash consideration of $333 million (#184.3
million), together with debt and other obligations to be repaid by Gyrus of $164
million (#90.7 million) on completion of the Acquisition. Further details of the
Acquisition are set out in the document comprising listing particulars and a
class 1 circular (the "Listing Particulars") which will be circulated to
Shareholders in due course. The consideration will be satisfied through the
issue of the Placing Shares detailed below and from the increased banking
facilities detailed below.
INFORMATION ON ACMI
ACMI was founded in 1904 and was a pioneer in the development of urological
instrumentation and endoscopic equipment. ACMI currently targets four key areas
in the field of minimally invasive surgery: urology; gynaecology; general
surgery; and visualisation. It has a significant direct US sales force and has
four manufacturing facilities in the US and Canada. It also has an Israel-based
subsidiary, CByond, a research and development company developing technologies
in the digital visualisation area.
ACMI achieved total sales of $184.7 million (#102.2 million) in the financial
year ended 31 December 2004 and earnings before interest, tax, depreciation and
amortisation and operating exceptional items and adjusted for one off operating
items of $27.0 million (#14.9 million). As at 31 December 2004 ACMI had net
assets of $37.9 million. ACMI generated US sales in the financial year ended 31
December 2004 of $109.7 million in urology, $35.6 million in gynaecology and
general surgery and $5.7 million in visualisation (not including sales of
visualisation products within urology, gynaecology and general surgery).
REASONS FOR AND BENEFITS OF THE ACQUISITION
Gyrus's vision is to become a world leader in the medical device field by
providing innovative, procedure-enabling products that minimise discomfort and
improve patient outcomes. Following completion of the Acquisition, this will
remain the vision of the Enlarged Group as Gyrus's and ACMI's complementary
products share a focus on surgeon-led and indication-specific procedures in
minimally invasive surgery. The Enlarged Group will combine ACMI's urology,
gynaecology and endoscopic expertise with Gyrus's tissue management technology
in these fields. This will enable the Enlarged Group to meet two key
requirements of surgeons - the ability to visualise the operative site and the
ability effectively to manipulate tissue with minimum collateral damage.
Specifically Gyrus believes that the Acquisition will bring the following
benefits to the Enlarged Group:
Opportunities in urology - ACMI's US leadership position in urology and its
broad product range will complement the SuperPulseTM system, Gyrus's
increasingly successful product offering for urological surgery.
Opportunities in gynaecology - ACMI's gynaecology business will add a wider
product range and other gynaecological procedures to Gyrus's existing strength
in the field of laparoscopic hysterectomies.
Opportunities in general surgery - The Enlarged Group's established US product
range and leading positions in urology and gynaecology will provide a platform
from which to expand into general surgery with technologies in visualisation and
tissue management.
Opportunities in visualisation - ACMI's established position in surgical
visualisation, coupled with its recently-developed All-Digital EndoscopyTM
system, will enable the Enlarged Group to sell visualisation products into each
of its specialist indication areas. Digital endoscopy offers enhanced picture
clarity and definition. A patented combined array of lightsource microchip and
optics offers the potential to develop narrower scopes for a wider field of
applications.
Sales force efficiencies - The addition of the existing ACMI sales team will
give the Enlarged Group the platform to expand and better utilise its sales
forces which will be organised into an urology sales force and a gynaecology and
general surgery sales force. This should allow the Enlarged Group to maximise
the opportunities within the combined product-specific portfolio and increase
its focus on direct sales.
Improve the international sales network - Outside the US, the combination of
ACMI's product portfolio and Gyrus's direct sales teams and distribution network
should allow the Enlarged Group to expand and enhance its international sales
performance.
Manufacturing efficiencies - The integration of the existing manufacturing
expertise and facilities of Gyrus and ACMI should allow the Enlarged Group to
continue to improve manufacturing efficiencies. In particular, the existing
Gyrus "lean manufacturing" process and ACMI "process improvements" initiatives
will be combined to improve profitability.
R&D efficiencies - The Enlarged Group will have a portfolio of products ranging
from Gyrus's PK technology through to ACMI's All-Digital EndoscopyTM system
allowing it to continue to target the surgeon-led, indication-focused demand for
specialist products. The Enlarged Group should benefit from the combination of
the R&D capabilities and expertise of Gyrus and ACMI and will continue to invest
in R&D to enhance its existing product range and develop the next generation of
products.
STRATEGY AND PROSPECTS OF THE ENLARGED GROUP
Following completion of the Acquisition it is intended that Gyrus's existing
surgical division will be separated into two with a urology division focused on
that area and a restructured surgical division focused on gynaecology and
general surgery. Consequently, the Enlarged Group will have four operating
divisions:
* ENT Division - focused on otology, sinus and rhinology and head & neck;
* Urology Division - focused on urology;
* Surgical Division - focused on gynaecology and general surgery; and
* Partnered Technologies Division - which will continue to exploit the
Enlarged Group's technologies outside its core areas of focus through
strategic partnership. This division is focused on the cosmetic,
cardiovascular, gastrointestinal, hysteroscopy and arthroscopy areas.
ACMI achieved adjusted earnings before interest, tax depreciation and
amortisation in the financial year ended 31 December 2004 of $27.0 million
(#14.9 million). Gyrus anticipates that the Enlarged Group will benefit from the
manufacturing process improvement programme initiated by ACMI in the fourth
quarter of 2004 and that, in addition, the combination of ACMI and Gyrus will
create opportunities for cost synergies arising from:
* Expansion of Gyrus's "lean manufacturing" process throughout the Enlarged
Group to improve gross margins;
* Utilising improved purchasing power across the supply chain to reduce
material costs;
* Optimisation of the manufacturing facilities; and
* Rationalisation of back office functions.
Gyrus expects the process improvement programme and cost synergy benefits taken
together to enhance pre-tax earnings by approximately $22 million (#12.2
million) per annum by the end of the three-year period following the
Acquisition. In order to realise these benefits, Gyrus anticipates significant
non-recurring costs of approximately $33 million (#18.3 million) in total. It is
likely that these costs will be accounted for across the whole of the three year
period following the Acquisition. Gyrus believes that the Acquisition will be
earnings enhancing in 2006 and for the foreseeable future, before any
non-recurring costs, the amortisation of intangible assets and any non-cash
charges for equity incentive schemes required under IFRS.
Gyrus anticipates significant opportunities to enhance the revenues of the
Enlarged Group through the realignment of the Enlarged Group's sales forces into
separate urology and gynaecology/general surgery teams. Given the benefits
likely to accrue to the Enlarged Group in the form of ACMI's process
improvements programme and the synergies that Gyrus expects to arise as a result
of the Acquisition, Gyrus views the financial and trading prospects of the
Enlarged Group for the current financial year and beyond with optimism. Upon
completion of the Acquisition, the Enlarged Group will have pro forma net
borrowings of approximately #139.3 million.
CURRENT TRADING
Gyrus continues to trade well during 2005 with the ENT and Surgical Divisions
growing revenues as expected and the Partnered Technologies Division
experiencing the flat revenues but increased volumes that were anticipated at
the end of 2004. Overall revenues continue to grow in accordance with
expectations. The Group's three-year operating efficiency programme continues to
yield margin improvements.
THE ACQUISITION
Pursuant to the Acquisition Agreement, Gyrus will purchase ACMI for a total
consideration of $497 million comprising consideration of $333 million
(comprising the issue of the Placing Shares with the balance being in cash)
together with $164 million of debt or other obligations to be repaid by Gyrus.
The Acquisition Agreement is subject to a number of conditions including the
approval of shareholders, regulatory approval under the HSR Act and Admission.
THE VENDOR PLACING
The Company has entered into the Vendor Placing Agreement with Numis and Panmure
Gordon pursuant to which, inter alia, Numis and Panmure Gordon have agreed to
procure placees for the Placing Shares (other than Placing Shares to be acquired
by the Seller Placees) at the Placing Price. The Vendor Placing, which has been
fully underwritten by Numis and Panmure Gordon (other than in respect of the
Placing Shares to be acquired by the Seller Placees), is conditional, inter
alia, upon Shareholder approval, the Vendor Placing Agreement becoming
unconditional in all respects and not having been terminated in accordance with
its terms and Admission. Shareholders have no right of pre-emption in respect of
the Placing Shares.
FP ACMI, LLC, FP Blue, LLC, FP Annex Fund, LLC, GS Mezzanine Partners, L.P. and
GS Mezzanine Partners Offshore, L.P., the Seller Placees to whom Placing Shares
will be issued, will acquire as placees a total of 13,724,025 Placing Shares
pursuant to the Vendor Placing. These shares will be subject to certain
restrictions more fully described in the Listing Particulars.
The Placing Shares will be issued credited as fully paid by virtue of completion
of the Acquisition Agreement and will be identical to and rank pari passu in all
respects with the existing Ordinary Shares, including the right to receive all
future dividends and other distributions declared, paid or made in respect of
the Ordinary Shares from the date of Admission. The Placing Shares are not being
made available to the public and are not being offered or sold in any
jurisdiction where it would be unlawful to do so.
Application has been made to the UK Listing Authority for the Placing Shares to
be admitted to the Official List and to the London Stock Exchange for the
Placing Shares to be admitted to trading on the London Stock Exchange's market
for listed securities. It is expected that Admission will become effective and
that dealings for normal settlement in the Placing Shares will commence on 19
July 2005.
Further information on, and details of the obligations and termination rights
under, the Vendor Placing Agreement are set out in the Listing Particulars.
EXTRAORDINARY GENERAL MEETING
An Extraordinary General Meeting will be held on 4 July 2005 at 11.00 a.m. The
purpose of the Extraordinary General Meeting is to seek Shareholders' approval:
(i) of the Acquisition;
(ii) to increase the authorised share capital of Gyrus from #3,000,000 to
#3,261,632 representing an increase of 8.7 per cent.;
(iii) to confer on the Directors authority under section 80 of the Act to allot
the Placing Shares and further relevant securities (as defined in section 80(2)
of the Act) up to a maximum nominal amount of #205,468 which, together with the
existing authorities under section 80 of the Act, represents 33.3 per cent. of
the ordinary share capital of the Company in issue after completion of the
Vendor Placing;
(iv) to authorise the remuneration committee of the Company to make a special
one-off grant of a conditional award of shares under the 2005 Long Term
Incentive Plan to up to 25 senior executives of the Enlarged Group; and
(v) to increase the aggregate maximum remuneration which may be paid to the
non-executive directors from #150,000 to #300,000 per annum and to amend the
Company's articles of association accordingly.
FURTHER INFORMATION ON ACMI
History and overview
ACMI was founded in 1904 and was a pioneer in the development of urological
instrumentation and endoscopic equipment. ACMI is a leading designer,
manufacturer, marketer and servicer of surgical systems primarily for urology
and gynaecology used by surgeons and physicians for diagnosis and minimally
invasive surgery ("MIS").
Between 1910 and 1930, ACMI developed into a leading manufacturer of innovative
urological instruments in the US, patenting nearly 50 devices, including such
landmark products as retroscopes, cystoscopes, optical lens systems,
lithotriptors, otoscopes and illuminators. ACMI continued to advance the state
of endoscopy thereafter with the development of fibre optics and coherent image
bundles for flexible endoscopy.
In 1986, ACMI merged with the Circon Corporation, a pioneer in the use of colour
video technology within the field of medicine and recognised as having launched
the world's first successful medical video system. In the years immediately
following this merger, ACMI focused on updating and redesigning a large number
of its endoscopic instruments including the development of the first flexible
cystoscope and new, more advanced camera systems.
In 1995, ACMI merged with Cabot Medical, then owner of Surgitek, thereby
broadening ACMI's product line to include disposable urology products including
stents, guidewires and stone baskets. The Cabot merger created a
publicly-traded, minimally invasive surgery company with a strong presence in
the endoscopic, urological and gynaecological fields. It also brought the
capability to design, manufacture and market disposable gynaecological,
urological and general surgical medical devices.
In November 1999, ACMI was acquired by a consortium led by investment funds
managed by Fox Paine, a California-based private equity investment company.
In August 2004 ACMI acquired C2Cure, Inc. and its subsidiary CByond Ltd ("CByond
"), a research and development company developing technologies in the digital
visualisation area. The acquisition of CByond has enabled ACMI to offer its
All-Digital EndoscopyTM video endoscopy system, developed in partnership with
Cbyond. ACMI's digital endoscopy offers a number of significant technical
advantages, including improved image quality, the ability to implement product
upgrades through software changes and built-in LED illumination.
Products and industries
ACMI currently targets four key areas in the field of minimally invasive
surgery: urology; gynaecology; general surgery; and visualisation. ACMI's
product offering includes both durable equipment and disposable products as well
as service and repair operations for these products.
Urology
ACMI had US sales in urology in the financial year ended 31 December 2004 of
$109.7 million. ACMI has a number of product lines addressing this industry
including endoscopes, flexible cystoscopes, and surgical instruments for benign
prostatic hyperplasia and kidney stone management and lithotripsy systems. Key
competitors in this industry include Karl Storz, Olympus and Richard Wolf.
Gynaecology and General Surgery
ACMI had US sales in gynaecology and general surgery in the financial year ended
31 December 2004 of $35.6 million. It has a number of product lines within this
field including surgical and diagnostic instruments for tubal ligation, tissue
removal/biopsies, cryosurgery and MIS procedures, endoscopes, insufflators,
suction-irrigation systems, biopsy instruments and other instruments for
minimally invasive procedures.
According to U.S. Uro-Gynecological Surgical Devices Markets, Frost & Sullivan,
2005, ACMI had an estimated US market share in 2004 in gynaecological endoscopic
products (comprising falloposcopes, laparoscopes and hysteroscopes) of 13.6 per
cent., giving it fourth position after Karl Storz, Richard Wolf and Johnson &
Johnson.
ACMI has market-leading positions within specific product areas in the
gynaecological market according to U.S. Uro-Gynecological Surgical Devices
Markets, Frost & Sullivan, 2005. Specifically ACMI had an estimated 21.4 per
cent. market share of the US hysteroscope market in 2004, giving it second
position after Johnson & Johnson and was US market leader in the gynaecological
fluid management systems market with an estimated 42.5 per cent. market share in
2004. Key competitors in this market include Johnson & Johnson and American
Medical Systems. ACMI was also market leader in the supply of devices for a
range of other gynaecological procedures (comprising tubal patency screening,
tubal ligation, dilation and curettage and myomectomy) with an estimated market
share of 30.5 per cent. in 2004. Key competitors in this market include American
Medical Systems, Tyco Healthcare, Boston Scientific and Cooper Surgical.
Visualisation
ACMI had sales in the visualisation industry in the financial year ended 31
December 2004 of $5.7 million. This does not include the indication-specific
visualisation products such as endoscopes that are included under the relevant
indications detailed above. Within visualisation, ACMI has a number of product
lines including cameras, monitors and light sources. In August 2004 ACMI
acquired CByond, an Israeli-based developer and manufacturer of digital
visualisation technologies for medical devices. During the two years prior to
acquiring CByond, ACMI partnered with CByond and launched its All-Digital
EndoscopyTM video endoscopy system.
Sales and distribution network
ACMI has a significant direct US sales force focused primarily on minimally
invasive technology in the fields of urology, gynaecology and general surgery. A
sales force of approximately 90 persons covering 10 regions in the US is
supported by approximately 100 marketing and customer service personnel and
services over 7,300 customer accounts. ACMI has approximately 60 product lines
with approximately 3,200 SKUs.
ACMI had international sales of $25.2 million in the financial year ended 31
December 2004, equivalent to 14 per cent. of total revenues. Internationally
ACMI sells in 72 countries through a network of over 40 distributors except in
Canada where it maintains a direct sales force.
Research and development
ACMI maintains an active R&D department with approximately 70 employees.
Expenditure in the financial year ended 31 December 2004 was $13.9 million
equivalent to approximately 8 per cent. of revenues. R&D expenditure is focussed
on the internal development of products, specifically endoscopes and cameras.
Intellectual property and patent strategy
ACMI's intellectual property and patent strategy is coordinated at a corporate
level by the legal department, in coordination with the chief technology
officer. ACMI pursues wide patent protection for its technology. ACMI's patent
applications are typically filed first in the US patent office, to be followed
by other foreign applications within 12 months.
Patent submissions on the novel features of ACMI's technologies are at different
stages of maturity as they progress through the various patent offices. On an
on-going basis, ACMI will pursue further applications based on new embodiments
of the technologies. ACMI currently has over 100 active patents worldwide
covering various aspects of its technology.
Manufacturing
ACMI has vertically integrated manufacturing with key capabilities in the areas
of design and manufacture of optical lens systems and assemblies, fibre optic
bundles and mechanical instrument components, plastics and coating technologies,
software and hardware development as well as design and assembly for digital
technology. Over 80 per cent. of ACMI's revenues are derived from
self-manufactured products produced through four manufacturing facilities in the
US and Canada.
Financial summary
A summary of the trading results for ACMI as extracted without material
adjustment from the accountants' report set out in the Listing Particulars is
set out below.
For the year ended 31 December
2002 2003 2004
$'000 $'000 $'000
Turnover 169,341 177,075 184,723
Gross Profit 88,118 88,596 86,971
Operating Profit (before goodwill 15,003 19,211 18,635
amortisation and exceptional items)
Depreciation - fixed assets 2,881 3,268 2,775
Write down of placed assets 1,349 1,273 1,923
Amortisation of intangible assets 983 1,438 1,255
_____ _____ _____
EBITDA (before exceptional items) 20,216 25,190 24,588
One-off operating items - - 2,452
_____
_____ _____
Adjusted EBITDA 20,216 25,190 27,040
Properties
ACMI currently has its headquarters and administrative functions located in a
leased facility in Southborough, Massachusetts, USA. ACMI's flexible scopes and
lenses are manufactured at leased facilities located in Stamford, Connecticut,
USA. ACMI's rigid scopes, loops and electrodes are manufactured in an owned
facility located in Norwalk, Ohio, USA. ACMI's video, suction, irrigation and
stent products are manufactured in owned facilities located in Racine,
Wisconsin, USA. ACMI's hand instruments are manufactured in leased facilities
located in Windsor, Ontario, Canada. A small leased facility located in Santa
Barbara, California, USA, specialises in the assembly of microtools. The
microtool assembly business is currently in the process of being transferred
from Santa Barbara to Windsor. ACMI also has a leased facility in Nesher, Israel
at which the development, assembly and testing of its digital visualisation
technology is carried out.
Employees
The number of full time employees of ACMI by function as at 30 September 2004
was as follows:
Manufacturing: 549
Sales, marketing and customer service: 207
Research and development: 77
General and administration: 66
Total: 899
EXPECTED TIMETABLE OF PRINCIPAL EVENTS
2005
Listing Particulars and Forms of Proxy posted to Shareholder 16 June
Latest time and date for receipt of Forms of Proxy 11:00 a.m. on 2 July
Extraordinary General Meeting 11:00 a.m. on 4 July
Expected date of completion of the Acquisition, Admission, settlement and 8.00 a.m. on 19 July
commencement of dealings in the Placing Shares
Expected date for crediting of the Placing Shares issued to CREST stock accounts 19 July
in uncertificated (paperless) form
Despatch of definitive share certificates in respect of the Placing Shares in 27 July
certificated form by
Notes:
(1) The dates set out in the Expected Timetable of Principal Events
above and mentioned throughout this announcement may be adjusted by agreement
between the Company and Numis, in which event the new dates will be notified to
the UK Listing Authority and to the London Stock Exchange and, where
appropriate, to Shareholders.
(2) All references to time in this announcement are to British Summer Time.
STATISTICS RELATING TO THE VENDOR PLACING
Number of Placing Shares 61,560,025
Number of Ordinary Shares in issue immediately following completion of the Vendor 145,383,517
Placing (assuming no exercise of options under the Share Incentive Schemes)
Market capitalisation of the Company immediately following completion of the 363.5 million
Vendor Placing (at the Placing Price)
Numis Securities Limited, Bear, Stearns International Limited and Panmure Gordon
(UK) Limited, which are regulated in the United Kingdom by The Financial
Services Authority, are acting exclusively for Gyrus Group PLC (within the
meaning of the Rules of the Financial Services Authority) in connection with the
Vendor Placing and for nobody else. Numis Securities Limited, Bear, Stearns
International Limited and Panmure Gordon (UK) Limited will not be responsible to
anyone other than Gyrus Group PLC for providing the protections afforded to
their respective customers, nor for providing advice in relation to the Vendor
Placing or the contents of this announcement or any matter referred to in this
announcement. Neither the Ordinary Shares nor the Placing Shares have been, or
will be, registered under the United States Securities Act of 1933 (as amended),
or under the securities laws of any state of the United States or any province
or territory of Canada, Australia, Japan, the Republic of Ireland or the
Republic of South Africa. Subject to certain exceptions, the Placing Shares may
not, directly or indirectly, be offered, sold, taken up or delivered in or into
or from the United States, Canada, Australia, Japan, the Republic of Ireland or
the Republic of South Africa or their respective territories or possessions.
This announcement does not constitute an offer to sell or issue or the
solicitation of an offer to buy or subscribe for New Ordinary Shares in any
jurisdiction in which such offer or solicitation is unlawful. Accordingly,
copies of this announcement are not being and must not be mailed or otherwise
distributed or sent in or into or from the United States, Canada, Australia,
Japan, the Republic of Ireland or the Republic of South Africa and any person
receiving this announcement (including custodians, nominees and trustees) must
not distribute or send it in or into or from the United States, Canada,
Australia, Japan or the Republic of Ireland or the Republic of South Africa.
This announcement has not been approved by any of Numis Securities Limited,
Bear, Stearns International Limited and Panmure Gordon (UK) Limited for the
purposes of section 21 of the Financial Services and Markets Act 2000.
APPENDIX I
Terms and Conditions of the Placing
1. Introduction
These terms and conditions apply to persons making an offer to acquire Placing
Shares under the Placing (which may include Numis or Panmure Gordon or any of
their respective nominee(s)). References in these terms and conditions to the
"Placing Agents" shall be to Numis and/or Panmure Gordon, as the context shall
require.
Each person to whom these conditions apply, as described above, who confirms his
agreement to the Placing Agents (on behalf of themselves and the Company) to
acquire Placing Shares (a "Placee") hereby agrees with each of the Placing
Agents and the Company and Capital IRG, the Company's registrars, to be bound by
these terms and conditions as being the terms and conditions upon which Placing
Shares will be issued and acquired under the Placing. A Placee shall, without
limitation, become so bound if the Placing Agents confirm to the Placee its
allocation of Placing Shares pursuant to the Placing.
Members of the public are not eligible to take part in the Placing. The
announcement and the terms and conditions set out herein are directed only at
persons ("Relevant Persons") whose ordinary activities involve them in
acquiring, holding, managing and disposing of investments (as principal or
agent) for the purposes of their business and who have professional experience
in matters relating to investments for the purposes of Article 19 of the
Financial Services and Markets Act 2000 (Financial Promotion) Order 2001, as
amended. The announcement and the terms and conditions set out herein must not
be acted on or relied on by persons who are not Relevant Persons. Any
investment or investment activity to which the terms and conditions set out
herein relates is available only to Relevant Persons and will be engaged in only
with Relevant Persons. Neither the announcement nor the terms and conditions
set out herein constitute an offer for sale or subscription of any securities in
the Company.
2. Agreement to acquire Placing Shares
Conditional on (i) the Vendor Placing Agreement becoming unconditional in all
respects, including as to Admission occurring on or prior to 8.00 a.m. on 13
August 2005 and not having been terminated in accordance with its terms and (ii)
receipt by the Placee of the confirmation from the Placing Agents referred to in
paragraph 1 above, each Placee agrees to acquire at the Placing Price that
number of Placing Shares allocated to such Placee under the Placing in
accordance with the arrangements described in this document. To the fullest
extent permitted by law, each Placee acknowledges and agrees that it will not be
entitled to exercise any right of rescission at any time provided that this does
not affect any other rights such Placee may have.
The Vendor Placing may be terminated by Numis up until 5.00 p.m. on today's date
if a force majeure event occurs or at any time prior to 7.00 a.m. on the date of
Admission if there is a material breach of warranty. By accepting the
obligations set out in the terms and conditions herein the Placee agrees that
any exercise by Numis of any right to terminate the Vendor Placing Agreement or
to waive or extend any condition in the Vendor Placing Agreement shall be within
the absolute discretion of Numis and that Numis shall have no liability to the
Placee whatsoever in connection with any decision to exercise or not to exercise
any such right. If the Vendor Placing Agreement does not become unconditional
or is terminated in accordance with its terms prior to Admission, the Placing
will not proceed and the Placee's rights and obligations will cease and no
claims will be capable of being made by the Placee in respect of the Placing.
The Placing Shares will be issued credited as fully paid by virtue of completion
of the Acquisition Agreement and will be identical to and rank pari passu in all
respects with the existing Ordinary Shares, including the right to receive all
future dividends and other distributions declared, paid or made in respect of
the Ordinary Shares after the date of Admission. The Placing Shares are not
being made available to the public and are not being offered or sold in any
jurisdiction where it would be unlawful to do so.
The Placing Shares will be acquired by the Placee free of all expenses and free
of all stamp duty and stamp duty reserve tax ("SDRT") unless stamp duty or SDRT
is chargeable on the issue of Placing Shares to the Placee under any of sections
67 and 93 (Depository Receipts) or sections 70 or 96 (Clearance Services) of the
Finance Act 1986. By accepting the terms and conditions herein, each Placee
confirms and warrants that these sections will not apply to the issue of Placing
Shares to it. If the Placee is not able to confirm and warrant that the above
sections do not apply to it or if any such stamp duty or SDRT is payable under
such sections, it will be entirely for the Placee's account and neither the
Company nor the Placing Agents will have any liability in respect thereof.
3. Payment for Placing Shares
Each Placee undertakes to pay the Placing Price for each of the Placing Shares
allocated to such Placee in such manner as shall be directed by the Placing
Agents.
4. Representations and Warranties
By participating in the Placing and upon the Placing Agents making the
confirmation referred to in paragraph 1 above, each Placee confirms, represents,
warrants and undertakes to the Placing Agents (for the benefit of the Placing
Agents and the Company) that:
(i) the exercise by the Placing Agents (or either of them) of any
rights or discretion under the Vendor Placing Agreement shall be within the
absolute discretion of the Placing Agents (or the relevant one of them) and the
Placing Agents need not have any reference to the Placee and shall have no
liability to the Placee whatsoever in connection with any decision to exercise
or not to exercise any such right. Each Placee agrees that they have no rights
against the Placing Agents, the Company or any of their respective directors,
officers, employees, agents or advisers under the Vendor Placing Agreement
pursuant to the Contracts (Rights of Third Parties) Act 1999;
(ii) in agreeing to acquire Placing Shares under the Placing, each
Placee is relying solely on this announcement and the Listing Particulars and
not on any information or representation or warranty in relation to the Company
or any of its subsidiaries or any of its shares other than as contained in this
announcement and the Listing Particulars;
(iii) neither the Placee nor, as the case may be, their clients expect
the Placing Agents to have any duties or responsibilities to the Placee similar
or comparable to the duties of "best execution" and "suitability" imposed by The
Conduct of Business Source Book contained in The Financial Services Authority's
Handbook of Rules and Guidance, and that the Placing Agents are not acting for
the Placee and that the Placing Agents will not have any duties or
responsibilities for providing to the Placee the protections afforded to clients
of the Placing Agents or for providing any advice in relation to the Placing or
the Placing Shares;
(iv) to the fullest extent permitted by law and to the extent permitted
by the Rules of the Financial Services Authority, neither the Placing Agents nor
their respective ultimate holding companies nor any direct or indirect
subsidiary undertakings of those holding companies nor any of their respective
directors, officers, employees, agents and advisers shall be liable to the
Placee for any matter arising in connection with the Placing or any acquisition
of Placing Shares pursuant to the Placing and that where any such liability
nevertheless arises as a matter of law the Placee will immediately waive any
claim against any of such persons which the Placee may have in respect thereof;
(v) in the case of a person who confirms to the Placing Agents on
behalf of a Placee an agreement to acquire for Placing Shares that person
represents and warrants that he has the authority to do so on behalf of the
Placee;
(vi) it is not and is not applying as nominee or agent for, a person who
is, or may be, liable to pay stamp duty or SDRT under any of the sections 67,
70, 93 or 96 of the Finance Act 1986 (depositary receipts and clearance
services);
(vii) it is not a national or resident of the United States, Australia,
Canada or Japan or a corporation, partnership or other entity organised under
the laws of the United States, Canada, Australia or Japan and that the Placee
will not offer, sell, renounce, transfer or deliver directly or indirectly any
of the Placing Shares in to the United States, Australia, Canada or Japan or any
other jurisdiction where to do so would be in breach of any applicable law and/
or regulation or to or for the benefit of any person resident in the United
States, Australia, Canada or Japan or any other jurisdiction where to do so
would be in breach of any applicable law and/or regulation and the Placee
acknowledges that the Placing Shares have not been and will not be registered
under the United States Securities Act of 1933, as amended and the relevant
exemptions are not being obtained from the Securities Commission of any province
of Canada and that the same are not being offered for sale and may not be,
directly or indirectly offered, sold, transferred or delivered in the United
States, Australia, Canada or Japan or any other jurisdiction where to do so
would be in breach of any applicable law and/or regulation;
(viii) it is entitled to acquire the Placing Shares in its allocation
under the laws of all relevant jurisdictions which apply to such Placee and that
such Placee has fully observed such laws, obtained all governmental and other
consents which may be required thereunder or otherwise and complied with all
necessary formalities and that it has not taken any action or omitted to take
any action which will or may result in the Company or the Placing Agents or any
of their respective directors, officers, employees, agents or advisers acting in
breach of the legal or regulatory requirements of any territory in connection
with the Placing or its allocation of Placing Shares under the Placing; and
(ix) the Placee is a person of a kind described in paragraph 5 of
Article 19 or paragraph 2 of Article 49 of the Financial Services and Markets
Act 2000 (Financial Promotion) Order 2001 (as amended).
5. Supply and Disclosure of Information
If the Company, the Placing Agents, the Company's registrars or any of their
agents request any information about a Placee's agreement to acquire Placing
Shares, such Placee must promptly disclose it to them.
6. Miscellaneous
The rights and remedies of the Placing Agents, the Company and the Company's
registrars under these terms and conditions are in addition to any rights and
remedies which would otherwise be available to each of them and the exercise or
partial exercise of one will not prevent the exercise of others. On
application, each Placee may be asked to disclose, in writing or orally, to the
Placing Agents:
(i) if he is an individual, his nationality; or
(ii) if he is a discretionary fund manager, the jurisdiction
in which the funds are managed or owned.
All documents will be sent at the Placee's risk. They may be sent by post to
such Placee at an address notified to the Placing Agents.
Each Placee agrees to be bound by the Memorandum and Articles of Association of
the Company (as amended from time to time) once the Placing Shares which such
Placee has agreed to acquire have been issued to such Placee.
The contract to acquire Placing Shares and the appointments and authorities
mentioned herein will be governed by, and construed in accordance with, the laws
of England. For the exclusive benefit of each of the Placing Agents, the
Company and the Company's registrars, each Placee irrevocably submits to the
exclusive jurisdiction of the English courts in respect of these matters This
does not prevent an action being taken against a Placee in any other
jurisdiction.
In the case of a joint agreement to acquire Placing Shares, references to a
Placee in these terms and conditions are to each such Placee and such Placees'
liability is joint and several.
Monies received from Placees pursuant to the Vendor Placing will be held by or
on behalf of the Placing Agents until such time as the Vendor Placing Agreement
becomes unconditional in all respects. If the Vendor Placing Agreement does not
become unconditional in all respects by 8.00 a.m. on 13 August 2005, such monies
will be returned without interest.
APPENDIX II
The following definitions apply throughout this announcement:
"Acquisition" the proposed acquisition of ACMI pursuant to the Acquisition Agreement;
"Acquisition Agreement" the conditional agreement dated 16 June 2005 between, amongst others, the
Company, ACMI and the Seller Placees relating to the Company's acquisition
of ACMI;
"Admission" admission of the Placing Shares to the Official List and to trading on the
market for listed securities of the London Stock Exchange and "Admission
becoming effective" means it becoming effective in accordance with the
Listing Rules and paragraph 2.1 of the Admission and Disclosure Standards;
"Admission and Disclosure Standards" the rules published by the London Stock Exchange in relation to the
admission to trading of, and confirming requirements for, securities
admitted to the London Stock Exchange's market for listed securities;
"Company" Gyrus Group PLC;
"Enlarged Group" Gyrus, its subsidiaries and its subsidiary undertakings (and, where the
context requires it, its associated undertakings) following completion of
the Acquisition;
"FSMA" the Financial Services and Markets Act 2000, as amended;
"Gyrus" or "Group" the Company and its subsidiaries and subsidiary undertakings, and, where
the context requires it, its associated undertakings;
"Listing Rules" the listing rules of the UK Listing Authority made under section 74 of
FSMA;
"London Stock Exchange" the London Stock Exchange plc;
"Numis" or "Sponsor" Numis Securities Limited;
"Official List" the Official List of the UK Listing Authority;
"Ordinary Shares" ordinary shares of 1 pence each in the Company;
"Panmure Gordon" Panmure Gordon (UK) Limited;
"Placing Price" 250 pence, being the price at which each Placing Share is to be issued
under the Vendor Placing;
"Placing Shares" the 61,560,025 Ordinary Shares to be placed by Numis pursuant to the Vendor
Placing Agreement;
"Seller Placees" FP ACMI, LLC, FP Blue, LLC, FP Annex Fund, LLC, GS Mezzanine, L.P. and GS
Mezzanine Partners Offshore, L.P.
"UK Listing Authority" the Financial Services Authority acting in its capacity as competent
authority under FSMA;
"United Kingdom" or "UK" the United Kingdom of Great Britain and Northern Ireland;
"United States", "US" or "USA" the United States of America, its territories and possessions, any state of
the United States of America and the District of Columbia;
"Vendor Placing" the conditional placing of the Placing Shares at the Placing Price on the
terms and conditions of the Vendor Placing Agreement; and
"Vendor Placing Agreement" the conditional agreement dated 16 June 2005 between the Company, Numis and
Panmure Gordon, details of which are set out in paragraph 13 of Part VII of
the Listing Particulars.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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