TIDMTFL
RNS Number : 7434K
EME Capital LLP
01 August 2013
Not for release, publication or distribution in whole or in
part, directly or indirectly in or into or from any jurisdiction
where to do so would constitute a violation of the laws of such
jurisdiction.
1 August 2013
RECOMMENDED CASH OFFER WITH SHARE ALTERNATIVE
by
MIRFIELD 1964 PLC ("MIRFIELD")
for
THEO FENNELL PLC (the "COMPANY")
(to be implemented by way of a scheme of arrangement under Part
26 of the Companies Act 2006)
Summary
-- The board of Mirfield and the Independent Directors of the
Company are pleased to announce that they have reached agreement on
the terms of a recommended cash offer, with a share alternative, to
be made by Mirfield, for the whole of the issued and to be issued
ordinary share capital of the Company (the "Acquisition"). Mirfield
was incorporated on 11 June 2013 specifically for the purpose of
making the Acquisition on behalf of EME Capital and its
co-investors.
-- It is proposed that the Acquisition will be made by way of a
Scheme of Arrangement between the Company and its shareholders
under Part 26 of the Companies Act (the "Scheme").
-- Under the terms of the Acquisition, Target Company
Shareholders will be entitled to receive 12.5 pence in cash (the
"Cash Consideration") for each Target Company Share (the "Cash
Offer"), valuing the existing issued ordinary share capital of the
Company at approximately GBP2.9 million, and representing a premium
of 100% to the closing mid-market price of 6.25 pence of a Target
Company Share on 31 July 2013, being the last practicable business
day prior to the date of this announcement.
-- In addition, Mirfield will offer a share alternative to the
Cash Offer on the basis of 0.08796 unlisted Mirfield B Shares for
each Target Company Share (the "Share Alternative"). Target Company
Shareholders may elect to receive the Share Alternative in respect
of all but not some of their holding of Target Company Shares.
However, the maximum number of Mirfield B Shares that may be issued
under the Share Alternative will be 611,111 Mirfield B Shares which
would represent 10% of the issued share capital of Mirfield upon
completion of the Scheme. This means that the Share Alternative
will be available for a maximum of 6,947,601 Target Company Shares,
which is equivalent to 30% of the issued share capital of the
Company as at 31 July 2013, being the last practicable business day
prior to the date of this announcement. If the maximum number of
Mirfield B Shares available under the Share Alternative is not
sufficient to satisfy all valid elections for the Share Alternative
in full, entitlements will be scaled back pro rata and to the
extent that, following such scale-back, any Target Company
Shareholder does not receive Mirfield B Shares in respect of all
the Target Company Shares which are the subject of his election for
the Share Alternative, he will instead receive the Cash
Consideration for the remaining Target Company Shares. Target
Company Shareholders who do not elect to receive the Share
Alternative will receive Cash Consideration in respect of all of
their Target Company Shares.
-- The Mirfield B Shares will be unlisted and there are no plans
to seek a public quotation on any recognised investment exchange or
other market for the Mirfield B Shares which may be issued to
Target Company Shareholders pursuant to the Share Alternative nor
in respect of any other Mirfield Shares.
-- As part of the Acquisition, the Company will also acquire all
the shares in The Original Design Partnership Limited ("ODP") which
are not already held by it (the "ODP Purchase"). ODP is currently
owned as to 20% by the Company, 60% by Mr Theo Fennell ("Mr
Fennell"), 12% by Mr Alasdair Hadden-Paton ("Mr Hadden-Paton") and
the remaining 8% is owned by other employees and former employees
of the Company. Both of Mr Fennell and Mr Hadden-Paton are
currently directors of the Company and ODP.
-- Also, as part of the Acquisition, Messrs Fennell and
Hadden-Paton will continue as directors of the Company and have
entered into new service agreements with the Company (the "New
Service Agreements") which are conditional on completion of the
Acquisition when Messrs Fennell and Hadden-Paton will also be
appointed to the board of Mirfield.
-- Upon completion of the Acquisition, Mirfield will have four
classes of shares: A Shares subscribed for by the original
investors in Mirfield, B Shares which will be issued to Target
Company Shareholders under the Share Alternative, and C Shares and
D Shares which will be issued as "sweet equity" to incentivise
Messrs Piasecki (the proposed CEO following completion of the
Acquisition) and Fennell respectively.
-- Immediately following the Acquisition, and assuming no other
Target Company Shareholders elect to receive the Share Alternative,
Mr Fennell will own Mirfield B Shares and Mirfield D Shares
representing 9.1% of the total Mirfield Shares.
-- Mirfield considers the "Theo Fennell" brand as crucial to its
business plan and the success of the Acquisition. As part of the
Acquisition, Mr Fennell has agreed to assign and transfer to the
Company all rights he owns in the name "Theo Fennell" and
associated intellectual property.
-- Mirfield recognises the Company's brand and existing creative
talent remain of the calibre required to enhance and expand the
Company's position as a highly respected designer and retailer.
Mirfield intends to add additional retail experience to the
Company's management.
-- Upon completion of the Acquisition, the Company will become a
wholly-owned subsidiary of Mirfield and an application will be made
for the admission of the Target Company Shares to trading on AIM
will be cancelled (the "AIM Cancellation").
-- Implementation of the Scheme will be subject, amongst other
things, to the sanction of the court and the approval of the Target
Company Shareholders of the resolutions to be proposed at the
Meetings. The Scheme Document setting out full details of the
Scheme and the procedures to be followed to approve the Scheme,
together with a Form of Election and Forms of Proxy will be
despatched to Target Company Shareholders within 28 days of the
date of this announcement.
-- Mirfield has received irrevocable undertakings from Target
Company Shareholders holding 33.5% of the existing share capital of
the Company to vote in favour of the Scheme, as well as irrevocable
undertakings to consent to be bound by the Scheme, should it be
approved, from Target Company Shareholders holding an additional
16.2% of the existing share capital of the Company.
-- In addition, Mirfield has received irrevocable undertakings
from Target Company Shareholders holding 16.1% of the existing
share capital of the Company to accept the Share Alternative,
subject to possible scale back.
-- The Independent Directors, who have been so advised by Opus
Corporate Finance LLP, consider the terms of the Acquisition, to be
fair and reasonable. However, the Independent Directors do not
express any view on the terms of the Share Alternative. In
providing its advice to the Independent Directors, Opus Corporate
Finance LLP has taken into account the commercial assessments of
the Independent Directors. For the purpose of Rule 16 of the
Takeover Code, Opus Corporate Finance LLP considers the terms of
the ODP Purchase, the Brand Repatriation Agreement, the New Service
Agreements and the "sweet equity" arrangements for Mr Fennell
described in paragraph 9 below to be fair and reasonable insofar as
the Independent Shareholders are concerned. The ODP purchase by the
Company is a related party transaction under AIM Rule 13. The
Independent Directors of the Company, having consulted with Cantor
Fitzgerald Europe, consider that the ODP Purchase is fair and
reasonable in so far as the Independent Shareholders are concerned.
Accordingly, the Independent Directors intend unanimously to
recommend that Target Company Shareholders vote in favour of the
resolutions to be proposed at the Court Meeting and the General
Meeting.
Commenting on the offer, Rahan Shaheen, a partner in EME Capital
and a Director of Mirfield 1964 said:
"This is an exciting opportunity for Mirfield. Theo Fennell is a
well-established British luxury brand which is highly respected for
its distinctive designs and creative talent. The Mirfield team have
strong experience and proven track record of investing in and
growing successful luxury and consumer businesses. We believe that
with the necessary funding, a strong management team in place and a
focus on broadening the product range, Mirfield can help Theo
Fennell to realise its full potential and develop the business into
a successful global luxury brand."
Theo Fennell, Founder and Creative Director of Theo Fennell plc,
said:
"This is an excellent opportunity for the business. With the
additional capital and management expertise of Mirfield we will be
able to build an even stronger business and I am personally
delighted that I will continue to play a central role for Theo
Fennell plc"
This summary should be read in conjunction with the full text of
this Announcement of which it forms part (including the
Appendices).
The Acquisition (including the Scheme) will be subject to the
other terms set out in this Announcement and to the conditions set
out in Appendix 2 to this Announcement and to the full terms and
conditions to be set out in the Scheme Document, when issued. Any
vote in relation to the Acquisition or the Scheme should only be
made on the basis of the information contained in the Scheme
Document. Appendix 1 contains definitions of certain expressions
used in this summary and in this Announcement.
Appendix 5 contains details of the bases and sources of certain
information contained in this Announcement.
Enquiries
For further information contact:
Mirfield
Rahan Shaheen 020 3468 1900
Theo Fennell Plc
Theo Fennell 020 7591 5000
finnCap Ltd (Financial adviser to Mirfield)
Stuart Andrews/Christopher
Raggett 020 7220 0500
Opus Corporate Finance LLP (Financial adviser and Rule
3 adviser to the Company)
Malcolm Strang/John McElroy 020 7025 3600
Cantor Fitzgerald Europe (Nominated Adviser and Broker
to the Company)
Mark Percy/Catherine Leftley 020 7894 7000
Pelham Bell Pottinger (Public Relations adviser to the
Company)
James Henderson/Lucy Miles 020 7861 3885
finnCap Limited, which is authorised and regulated in the United
Kingdom by the Financial Conduct Authority, is acting exclusively
for Mirfield and no-one else in connection with the Acquisition and
this announcement and will not be responsible to anyone other than
Mirfield for providing the protections afforded to clients of
finnCap Limited nor for providing advice in relation to the
Acquisition or the content of, or any matter or arrangement
referred to in, this announcement.
Opus Corporate Finance LLP, which is authorised and regulated in
the United Kingdom by the Financial Conduct Authority, is acting
exclusively for the Company and no-one else in connection with the
Acquisition and this announcement and will not be responsible to
anyone other than the Company for providing the protections
afforded to clients of Opus Corporate Finance LLP nor for providing
advice in relation to the Acquisition or the content of, or any
matter or arrangement referred to in, this announcement.
Cantor Fitzgerald Europe, which is authorised and regulated in
the United Kingdom by the Financial Conduct Authority, is acting
exclusively for the Company and no-one else in connection with the
confirmations made in this announcement in accordance with Rule 13
of the AIM Rules for Companies and will not be responsible to
anyone other than the Company for providing the protections
afforded to clients of Cantor Fitzgerald Europe nor for providing
advice in relation to the Acquisition or the content of, or any
matter or arrangement referred to in, this announcement.
The Mirfield Directors accept responsibility for the information
contained in this Announcement other than that relating to the
Target Company and ODP, the Target Company Directors and members of
their immediate families, related trusts and persons connected with
them. To the best of the knowledge and belief of the Mirfield
Directors (who have taken all reasonable care to ensure that such
is the case), the information contained in this Announcement for
which they accept responsibility is in accordance with the facts
and does not omit anything likely to affect the import of such
information.
The Independent Directors have consented to the issue of this
Announcement with the references to their names and the name of the
Company in the form and context in which they appear.
finnCap Ltd has consented to the issue of this Announcement with
the references to its name in the form and context in which it
appears.
Opus Corporate Finance LLP has consented to the issue of this
Announcement with the references to its name in the form and
context in which it appears.
Cantor Fiztgerald Europe has consented to the issue of this
Announcement with the references to its name in the form and
context in which it appears.
This announcement is not a prospectus. It is for information
purposes only and is not intended to, and does not constitute or
form part of an offer or invitation to sell or purchase any
securities or the solicitation of an offer to purchase, otherwise
acquire, subscribe for, sell or otherwise dispose of any
securities, pursuant to the Scheme or otherwise. Subject to the
rights of Mirfield to elect, subject to any required consent of the
Panel, to effect the Acquisition by way of an offer, the
Acquisition will be made solely by the Scheme Document and the
accompanying Forms of Proxy and Form of Election which will contain
the full terms and conditions of the Scheme.
Dealing disclosure requirements
Under Rule 8.3(a) of the Takeover 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 pm (London time) on the
10(th) business day following the commencement of the Offer Period
and, if appropriate, by no later than 3.30 pm (London time) on the
10(th) business day following the announcement in whichany 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 Takeover Code, any person who is, or
becomes, interested in 1 per cent. or more of any class of relevant
securities of the offeree company or of any paper offeror must make
a Dealing Disclosure if the person deals in any relevant securities
of the offeree company or of any paper offeror. A Dealing
Disclosure must contain details of the dealing concerned and of the
person's interests and short positions in, and rights to subscribe
for, any relevant securities of each of (i) the offeree company and
(ii) any paper offeror, save to the extent that these details have
previously been disclosed under Rule 8. A Dealing Disclosure by a
person to whom Rule 8.3(b) applies must be made by no later than
3.30 pm (London time) on the business day following the date of the
relevant dealing.
If two or more persons act together pursuant to an agreement or
understanding, whether formal or informal, to acquire or control an
interest in relevant securities of an offeree company or a paper
offeror, they will be deemed to be a single person for the purpose
of Rule 8.3.
Opening Position Disclosures must also be made by the offeree
company and by any offeror and Dealing Disclosures must also be
made by the offeree company, by any offeror and by any persons
acting in concert with any of them (see Rules 8.1, 8.2 and
8.4).
Details of the offeree and offeror companies in respect of whose
relevant securities Opening Position Disclosures and Dealing
Disclosures must be made can be found in the Disclosure Table on
the Takeover Panel's website at www.thetakeoverpanel.org.uk,
including details of the number of relevant securities in issue,
when the Offer Period commenced and when any offeror was first
identified.
If you are in any doubt as to whether you are required to make
an Opening Position Disclosure or a Dealing Disclosure, you should
contact the Panel's Market Surveillance Unit on +44 (0)20 7638
0129.
Rule 2.10 Disclosure
In accordance with Rule 2.10 of the Takeover Code, the Company
confirms that at the date of this Announcement, there are
23,158,029 Target Company Shares in issue and admitted to trading
on AIM. The ISIN of the Target Company Shares is GB0008858986.
In accordance with Rule 2.10 of the Takeover Code, Mirfield
confirms that at the date of this Announcement, there are 50,000
Mirfield A Shares in issue and no Mirfield B Shares, Mirfield C
Shares or Mirfield D Shares have been issued.
Forward-looking statements
This announcement may contain "forward-looking statements"
concerning the Target Company and Mirfield. Generally, the words
"anticipate", "believe", "estimate", "expect", "forecast",
"intend", "may", "plan", "project", "should" and similar
expressions identify forward-looking statements. Such statements
reflect the relevant company's current views with respect to future
events and are subject to risks and uncertainties that could cause
the actual results to differ materially from those expressed in the
forward-looking statements. Many of these risks and uncertainties
relate to factors that are beyond the Company's and Mirfield's
ability to control or estimate precisely, such as changes in
general economic and business conditions, changes in currency
exchange rates and interest rates, lack of acceptance of new
exchange rates and interest rates, introduction of competing
products or services, lack of acceptance of new products or
services, changes in business strategy and the behaviour of other
market participants and therefore undue reliance should not be
placed on such statements. Neither the Company nor Mirfield intends
or assumes any obligation to update these forward-looking
statements other than as required by law.
No profit forecasts or estimates
No statement in this Announcement is intended as a profit
forecast or profit estimate and no statement in this Announcement
should be interpreted to mean that future earnings per share of the
Enlarged Group for the current or future financial periods will
necessarily match or exceed the historical or published earnings
per share of the Target Company.
No material change
There has been no material change in relation to any information
previously published in the Offer Period except as disclosed in
this Announcement and in the announcement made by the Target
Company of its results for the year ended 31 March 2013 which is
made today.
Overseas Shareholders
The availability of the Cash Offer and the Share Alternative and
the release, publication or distribution of this Announcement in
jurisdictions outside of the United Kingdom may be restricted by
the laws of those jurisdictions and therefore persons into whose
possession this Announcement comes should inform themselves about
and observe any such restrictions. Failure to comply with any such
restrictions may constitute a violation of the securities laws of
any such jurisdiction. To the fullest extent permitted by
applicable law, the companies involved in the Acquisition 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 law and the Takeover 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 and regulations of any jurisdiction outside of
England.
The Acquisition relates to the acquisition of shares in a UK
public company and is proposed to be made by means of a scheme of
arrangement of that company with its shareholders under Part 26 of
the Companies Act. In particular, with respect to investors in the
United States, a transaction effected by means of a scheme of
arrangement is not subject to the tender offer rules under the US
Exchange Act. Accordingly, the Scheme is subject to the disclosure
requirements, rules and practices applicable in the United Kingdom
to schemes of arrangement, which differ from the requirements of US
tender offer rules. Financial information on the Company included
in the relevant documentation has been prepared in accordance with
accounting standards applicable to listed companies in the UK,
being IFRS as adopted by the European Union. These may not be
comparable to the financial statements of US companies.
This document is not an offer of securities for sale in the
United States. The Mirfield B Shares which will be issued in
connection with the Acquisition have not been, will not be and are
not required to be registered with the US Securities and Exchange
Commission (the "SEC") under the Securities Act of 1933, as amended
(the "US Securities Act") or under the securities laws of any
state, district or other jurisdiction of the United States, and may
not be offered, sold, delivered or transferred except pursuant to
an available exemption from or in a transaction not subject to the
registration requirements of the US Securities Act and applicable
US state securities laws.
Neither the SEC nor any other US federal or state securities
commission or regulatory authority has approved or disapproved the
Mirfield B Shares or passed an opinion upon the fairness or merits
of such securities or upon the accuracy or adequacy of the
disclosures contained in this document. Any representation to the
contrary is a criminal offence in the United States.
Information relating to Target Company Shareholders
Please be aware that addresses, electronic addresses and certain
information provided by Target Company Shareholders, persons with
information rights and other relevant persons for the receipt of
communications from the Target Company may be provided to Mirfield
during the offer period where requested under Section 4 of Appendix
4 of the Takeover Code to comply with Rule 2.12(c).
Publication on website and availability of hard copies
A copy of this announcement will be made available free of
charge (subject to any applicable restrictions with respect to
persons in restricted jurisdictions), at www.eme-capital.com and on
the website of the Target Company at www.theofennell.com by no
later than 12.00 noon on 2 August 2013 and will be available during
the course of the Scheme. You may request a hard copy of this
announcement, free of charge, by contacting finnCap, on 020 7220
0500. Unless so requested a hard copy of this Announcement will not
be sent to you. Target Company Shareholders may also request that
all future documents, announcements and information sent to you in
relation to the Scheme should be in hard copy form.
For the avoidance of doubt, neither the content of the websites
referred to above (nor any other website) nor the contents of any
website accessible from hyperlinks on any such website is
incorporated into or forms part of this announcement.
Not for release, publication or distribution in whole or in
part, directly or indirectly in or into or from any jurisdiction
where to do so would constitute a violation of the laws of such
jurisdiction.
1 August 2013
RECOMMENDED CASH OFFER WITH SHARE ALTERNATIVE
by
MIRFIELD 1964 PLC
for
THEO FENNELL PLC
(to be implemented by way of a scheme of arrangement under Part
26 of the Companies Act 2006)
1. Introduction
The board of Mirfield and the Independent Directors are pleased
to announce that they have reached agreement on the terms of a
recommended Cash Offer, with a Share Alternative, to be made by
Mirfield, for the whole of the issued and to be issued share
capital of Theo Fennell Plc.
It is proposed that the Acquisition will be made by way of a
court-approved Scheme of Arrangement of the Company with the Target
Company Shareholders under Part 26 of the Companies Act, although
Mirfield reserves the right, at its sole discretion and subject (if
required) to the consent of the Panel, to seek to implement the
Acquisition by way of an offer for the entire issued and to be
issued share capital of the Company, and to make appropriate
amendments to the terms of the Acquisition arising from the change
from the Scheme to an offer. The Scheme will be subject to the
Conditions set out below and in Appendix 2 to this announcement and
the full terms and conditions to be set out in the Scheme Document
and the Form of Election.
Subject to the satisfaction or, where appropriate, waiver of the
Conditions, it is expected that the Acquisition will become
effective in October 2013. Further details in respect of the
expected timetable of key events in relation to the Acquisition
will be set out in the Scheme Document to be sent to Target Company
Shareholders.
2. Terms of the Acquisition
The Cash Offer
The Cash Offer, which will be subject to the conditions and
principal further terms referred to in Appendix 2 of this
announcement, will be made, on the following basis:
for each Target Company Share, 12.5p in cash
The Cash Offer values the Company's entire issued share capital
of the Target Company at approximately GBP2.9 million, and
represents a premium of:
-- 100% to the closing mid-market price of 6.25 pence of a
Target Company Share on 31 July 2013 (being the last practicable
business day prior to the date of this announcement); and
-- approximately 6.4% to the closing mid market price of 11.75
pence of a Target Company Share on 4 September 2012 (being the
business day prior to the offer period);
-- approximately 37.4% to the average closing mid-market price
of 9.1 pence of a Target Company Share over the six month period
ended on and including 31 July 2013.
The Share Alternative
In addition, Target Company Shareholders (other than certain
Overseas Shareholders in Restricted Jurisdictions) will be offered
the Share Alternative as set out below and in Appendix 2.
Target Company Shareholders (other than certain Overseas
Shareholders in Restricted Jurisdictions) may elect, in respect of
all and not part of their holdings of Target Company Shares, to
receive unlisted Mirfield B Shares instead of all but not part of
the Cash Consideration due to them under the terms of the
Acquisition on the following basis:
for each Target Company Share, 0.08796 Mirfield B Shares
A maximum of 611,111 Mirfield B Shares, which would represent
10% of the issued share capital of Mirfield upon completion of the
Scheme, are available to Target Company Shareholders under the
Share Alternative. This means that the Share Alternative is
available for a maximum of 6,947,601 Target Company Shares,
representing 30% of the issued share capital of the Company on 31
July 2013, being the last practicable business day prior to the
date of this announcement.
If the maximum number of Mirfield B Shares available under the
Share Alternative is not sufficient to satisfy all valid elections
for the Share Alternative in full, entitlements will be scaled back
pro rata and to the extent that, following such scale-back, any
Target Company Shareholder does not receive Mirfield B Shares in
respect of all the Target Company Shares which are the subject of
his election for the Share Alternative, he will (in addition to his
pro rata share of the Mirfield B Shares) instead receive the Cash
Consideration for the remaining Target Company Shares. As a result,
Target Company Shareholders who elect to participate in the Share
Alternative, will not know the exact number of Mirfield B Shares or
the amount of cash (if any) that they will receive until settlement
of the consideration due to them in respect of the Acquisition.
Fractions of Mirfield B Shares will not be allotted or issued
pursuant to the Scheme to Target Company Shareholders and
entitlements will instead by rounded down to the nearest whole
number of Mirfield B Shares.
Target Company Shareholders who do not elect to receive the
Share Alternative will receive Cash Consideration in respect of all
of their Target Company Shares.
Following completion of the Acquisition, Mirfield will have four
classes of shares: A Shares subscribed for by the original
investors in Mirfield, B Shares which will be issued to Target
Company Shareholders under the Share Alternative, and C Shares and
D Shares which will be issued as "sweet equity" to incentivise
Messrs Piasecki and Fennell respectively. Details of their
respective "sweet equity" arrangements are set out in paragraph 9
below.
The Mirfield B Shares are identical to, and rank pari passu with
the Mirfield A Shares, Mirfield C Shares and Mirfield D Shares save
that they will be non-dilutable for a period of two years following
completion of the Acquisition. Following the expiry of this period,
all Mirfield B Shares will automatically be converted into and be
re-designated as Mirfield A Shares.
Further details of the terms of the Share Alternative and the
rights attaching to the Mirfield A Shares, the Mirfield B Shares,
the Mirfield C Shares and the Mirfield D Shares are set out in
Appendix 3 and paragraph 9 below.
Risk Factors in relation to the Share Alternative
The Share Alternative is not and will not be the subject of a
recommendation by the Independent Directors. It is recommended that
Target Company Shareholders carefully consider, in light of their
own investment objectives and having taken independent advice
appropriate to their own financial circumstances, whether they wish
to elect for the Share Alternative. The attention of Target Company
Shareholders who may be considering electing for the Share
Alternative is drawn to certain risk factors and other investment
considerations relevant to such an election. These will be set out
in full in the Scheme Document and include, amongst other things,
the following:
-- Mirfield is an unlisted company and there currently is, and
it is expected that there will continue to be, no market in
Mirfield Shares;
-- Mirfield has no plans to seek a listing or public quotation
of the Mirfield Shares on any recognised investment exchange or
other market following the implementation of the Scheme.
Consequently, Mirfield Shares may be difficult to sell;
-- Mirfield will not be subject to the disclosure, corporate
governance and shareholder protection requirements of any
recognised investment exchange;
-- the Mirfield Shares held by Target Company Shareholders will
represent a minority interest in Mirfield; even if the maximum
number of Mirfield B Shares is issued to the independent Target
Company Shareholders under the Share Alternative, they will
represent only 10 per cent. of the issued share capital of
Mirfield;
-- Mirfield currently has no intention to pay dividends; and
-- there is a possibility in the future that additional shares
will be issued by Mirfield and/or additional options over Mirfield
Shares may be granted to the management and/or employees of
Mirfield (as explained below). Although the Mirfield B Shares
cannot be diluted for a period of two years following the
completion of the Acquisition, the issue of new Mirfield Shares
following the expiry of this period will dilute the holding in
Mirfield of the Target Company Shareholders who elect for the Share
Alternative and are issued Mirfield B Shares. At Completion,
warrants to subscribe, (subject to certain conditions) at any time
during a period of 5 years after completion of the Acquisition for
up to such maximum number of Mirfield A Shares as represents 10% of
the fully-diluted share capital of Mirfield at the time of exercise
will be granted to EME Capital at an exercise price of 1p per
Mirfield A Share. If these warrants are exercised after the two
year period following the Acquisition, the issue of Mirfield A
Shares upon exercise of these warrants will dilute the holders of
Mirfield B Shares. Likewise, the issue of Mirfield C Shares and
Mirfield D Shares to Mr Piasecki and Mr Fennell respectively
(pursuant to their "sweet equity" arrangements further described in
paragraph 9 below) after the two year period following the
Acquisition will also dilute the holders of Mirfield B Shares.
3. Information on Theo Fennell Plc
The Target Company is an international luxury jewellery business
engaged in the design, manufacture and retailing of fine jewellery.
In the year ended 31 March 2013, the Company had turnover of
GBP10.7m and losses of GBP878k.
4. Information on The Original Design Partnership
The ODP is a private company making specialised commissioned
designs of jewellery. In the year ended 31 March 2013, the company
had turnover of GBP784k and losses of GBP98k.
The Target Company owns 20% of ODP. 60% is owned by Mr Fennell,
12% by Mr Hadden-Paton and the remaining 8% is owned by other
employees and former employees. As part of the Acquisition, the
Company will purchase all of the shares in ODP which it does not
currently own. Details of the ODP Purchase are set out in paragraph
10 below.
5. Information on Mirfield
Mirfield was incorporated in England and Wales as a public
limited company on 11 June 2013 for the purpose of carrying out the
Acquisition. Mirfield has received irrevocable commitments from
each of the persons listed below (together the "Investors"),
subject to the Scheme becoming effective prior to 31 December 2013,
to invest the aggregate sum of GBP5,500,000 through subscriptions
for Mirfield A Shares. Subject to completion of the Acquisition,
Mike Jatania, Sir Keith Mills and Jon Moulton have each agreed to
subscribe GBP1,500,000 for Mirfield A Shares and Mr Piasecki and
EME Capital have each agreed to subscribe GBP500,000 for Mirfield A
Shares.
Mike Jatania was CEO of the Lornamead Group, which he built into
a leading personal care company with the acquisition of over 30
brands with sales in over 50 countries around the world. He is most
known and recognized for his success in acquiring and investing in
well known brands. The Lornamead Group was sold to a strategic
buyer in December 2012.
Sir Keith Mills founded Air Miles International Group BV in
1988, which developed Air Miles, and Loyalty Management UK in 2001,
which developed the Nectar Card. He has also been a director of
Nadler & Larimer and Mills, Smith & Partners. Sir Keith was
knighted in recognition of his services to sport and in 2012 was
deputy chairman of the London Organising Committee of the Olympic
and Paralympic Games. Sir Keith is a resident of the United
Kingdom.
Jon Moulton is founder of the private equity firm Better
Capital, and is the former managing partner of the private equity
firm Alchemy Partners. Mr Moulton previously worked with Citicorp
Venture Capital in New York and London, Permira and Apax Partners.
He is a resident of Guernsey.
Jurek Piasecki was a director of Comet Group plc when he led the
buyout of Northern Goldsmiths plc in 1983 to create Goldsmiths
Group, which became the largest jewellery chain in the UK in 2004.
He has since founded Lockend Investments, which oversees a varied
portfolio of companies including home waste solutions and property,
and Nuval, a watch distribution company specialising in the import
and distribution of luxury watches and jewellery. He is a resident
of the United Kingdom. Following completion of the Acquisition,
Mirfield C Shares will be issued to Mr Piasecki pursuant to his
"sweet equity" arrangements further described in paragraph 9
below.
EME Capital LLP is authorised and regulated by the Financial
Conduct Authority and has offices in London, Paris and Dubai. The
firm engages in making private equity investments, primarily in the
luxury, hospitality and lifestyle sectors in Europe, and in
offering corporate finance and global capital placement services to
its clients. Mirfield has granted warrants to EME Capital to
subscribe for such maximum number of Mirfield A Shares as represent
10% of the fully diluted share capital of Mirfield at the time of
exercise at an exercise price of 1p per Mirfield A Share. Subject
to certain conditions, the warrants may be exercised at any time
during the period of five years following completion of the
Acquisition.
6. Background to and reasons for the Acquisition
EME Capital identified the Company as a potential acquisition
target in August 2012. Extensive due diligence has convinced EME
Capital and Mirfield that, notwithstanding tough trading
conditions, the Company's brand and the creative talent behind it
remain of the calibre required to enhance and expand the Company's
position as a highly respected designer and retailer. The Company's
British heritage and distinctive designs combine to place it in an
enviable position as a luxury brand with broad aspirational
appeal.
The Company's recent trading has led to cash flow constraints
and a consequent limitation on its capacity to invest in stock and
the business. Whilst trading losses have been reduced, the Company
needs additional capital in order to invest in stock to support
both its existing and new product lines. Mirfield strongly believes
that key to the success of its strategy will be a broadening of the
range of products available, which it is hoped will lead to
increased revenues generated from footfall in and around the
Company's existing locations in Burlington Arcade, the Royal
Exchange, Selfridges, Harrods and the Fulham Road. In particular,
the Fulham Road store will remain the Company's head office and
flagship retail location. Mirfield currently has no plans to
redeploy any of the fixed assets of the Company.
Mirfield has received commitments for an equity injection on
completion of the Acquisition of GBP5.5 million which will be used
to fund the cash consideration due under the Cash Offer, the
expenses incurred in making the Acquisition and further investment
in working capital. In addition the Company has received a
commitment letter to enter into a revolving credit facility of
GBP2.5m, subject to completion of the Acquisition, from the
Company's existing lender, Clydesdale Bank.
Mirfield believes that the management team will be key to the
success of its strategy. Accordingly, Mirfield and the Company have
agreed to appoint Jurek Piasecki, formerly of Goldsmiths, a leading
jewellery chain, as Chief Executive Officer of the Company, subject
to completion of the Acquisition. Messrs Piasecki and Fennell are
being issued with the "sweet equity" in order to incentivise their
performance. Any increase in Mr Piasecki's equity holding in
Mirfield is subject to the Company meeting certain targets. Any
increase in Mr Fennell's equity holding in Mirfield is subject to
the proviso that at the time of such grant he has not either
voluntarily resigned or been summarily dismissed by the Company in
accordance with his service contract. Such incentivisation should
ensure that Messrs Piasecki and Fennell are fully committed to
growing the business over the medium to long term. Further details
of the rights of Messrs Piasecki and Fennell to receive additional
shares are set out in paragraph 9 below.
In addition it is intended that Alasdair Hadden-Paton will
become a non-executive Director of the Company following completion
of the Acquisition and will be incentivised through commission
payments detailed in paragraph 9 below, to continue selling the
Company's products under Mirfield's ownership.
Mirfield believes that the Company will be better able to pursue
its strategy as a private company free from the financial and
regulatory burdens of the public arena. The cost and resource
savings arising if the Target Company's Shares cease to be admitted
to trading on AIM will free up funds and management time for the
achievement of Mirfield's strategy and realisation of the Company's
potential.
7. Background to and reasons for the Recommendation
As Shareholders will be aware, the Company has experienced
challenging trading conditions over the last few years with the
tough economic environment affecting consumer spending. As
previously announced, the Company experienced weak Christmas
trading. The Board has responded by significantly reducing costs
and restructuring the wholesale division. The Company has also been
proactive in launching new jewellery ranges, opening new sites in
London and expanding on-line sales. This has resulted in a
reduction in the losses of the business. However, despite these
efforts, sales continue to be under pressure and the Company's
bank, while generally supportive is seeking to reduce its
facilities to the Company on a stand alone basis.
The view of the Board is that the Company needs access to
additional capital to enable it to launch new ranges of jewellery
including additional high end pieces, in response to increased
demand. The Acquisition will lead to a substantial capital
injection into the business and also help secure long term bank
financing. This will enable the Company to expand its product
range, especially at the high end, to enter new markets and expand
internationally. The additional capital will also enable the
management team of the Company to be strengthened: EME Capital has
engaged Mr Piasecki, a very experienced chief executive for
Mirfield and the Company.
On 5 September 2012, the Company announced that it had received
an approach from EME Capital. Following this announcement the Board
received approaches from a number of interested parties, none of
which resulted in an acceptable proposal that the Board felt they
could recommend to Shareholders. The Independent Directors have
considered a number of alternative proposals for the Company,
including raising new equity capital, but believe the Cash Offer to
be the best option available to Shareholders. The Cash Offer will
enable Shareholders to exit their investment at a substantial
premium to the current share price.
The Share Alternative is not the subject of a recommendation by
the Independent Directors and Target Company Shareholders are
strongly advised to seek their own independent financial advice
before electing to participate in the Share Alternative.
8. Management and Employees
Mirfield recognises and respects the capabilities and experience
of the existing management and employees of the Company. Mirfield
intends to grow the Company's business over the coming years and
Mirfield confirms that the existing employment rights and benefits
of all the Target Company's and the ODP's employees will be fully
safeguarded on completion of the Acquisition.
It is proposed that Mr Fennell will be employed as Creative
Design Director of the Company and will be an executive director of
the Target Company and a non-executive director of Mirfield. It is
further proposed that Mr Hadden-Paton will no longer be the chief
financial officer of the Target Company but will continue as a
non-executive director of both the Target Company and Mirfield.
Further details of these arrangements are set out in paragraph 9
below.
Upon the Scheme becoming effective it is proposed that the
Independent Directors will resign from the board of the
Company.
EME Capital has entered into, conditional upon completion of the
Acquisition, an advisory agreement with Mirfield and the Company to
provide financial advisory services (including the provision of
personnel to undertake the role of chief financial officer, in
return for which a fee of GBP120,000 per annum is payable). In
consideration for its advisory services, EME Capital will also
receive a transaction fee of up to GBP140,000, and has been
granted, conditional upon completion of the Acquisition, warrants
to subscribe at par for up to such maximum number of Mirfield A
Shares as represents 10% of the fully-diluted share capital of
Mirfield at the time of exercise (subject to adjustment) at any
time during the period 5 years after the completion of the
Acquisition subject to satisfaction of performance-based targets
and other conditions. EME Capital will also provide two
individuals, namely Ahmad Salam and Rahan Shaheen, to act as
non-executive directors of Mirfield and will be paid an annual fee
of GBP100,000 for the provision of these two directors.
Mr Piasecki will be appointed as a non-executive director of
Mirfield and a company controlled by Mr Piasecki has entered into a
consultancy agreement with Mirfield and the Company pursuant to
which, conditional upon completion of the Acquisition, Mr
Piasecki's services will be made available to undertake the
functions of chief executive officer and to advise on, among other
things, the Target Company's strategy, staffing, budgeting and risk
management. The term of the consultancy agreement is for a fixed
period of 30 months following which it may be terminated upon 6
months notice by either party (subject to earlier termination for
breach). A fee of GBP180,000 per annum plus VAT shall be paid under
the consultancy agreement. Mr Piasecki will also be paid GBP20,000
per annum in consideration for acting as non-executive director of
Mirfield. Details of the "sweet equity" arrangements applicable to
Mr Piasecki are set out in paragraph 9.
Upon completion of the Acquisition, Mike Jatania will be
appointed as Non-Executive Chairman of Mirfield.
Further information on the employment and consultancy agreements
will be included in the Scheme Document.
Save as set out above, Mirfield does not have any current plans
to make any other material change in the terms and conditions of
employment of the management and employees of the Target Company,
the location of the Target Company's place of business or any
redeployment of its fixed assets.
9. Management Incentivisation
Mr Theo Fennell
Mr Fennell has entered into a new service agreement with the
Target Company and Mirfield pursuant to which, conditional upon
completion of the Acquisition, he will act as Creative Director of
the Target Company in return for a salary of GBP300,000 per annum
plus a pension entitlement of GBP50,000 per annum. These terms are
generally based on Mr Fennell's existing terms of employment, save
for an increase in salary (and certain benefits) to compensate Mr
Fennell for agreeing to the brand repatriation as described in
paragraph 11 below. Mr Fennell will also be appointed to the board
of Mirfield. Mr Fennell will act as a director of both the Target
Company and Mirfield, on an executive and non-executive basis
respectively.
Mr Fennell's new service agreement will be for a minimum term of
36 months (subject to various dismissal rights) and can thereafter
be terminated on 6 months' notice on either side. As this agreement
has a fixed term of more than 2 years, shareholder approval will be
required under the provisions of the Companies Act. An appropriate
resolution will be put to shareholders at the General Meeting.
To incentivise Mr Fennell in connection with the future business
of the Company, Mr Fennell will also be entitled to have sweet
equity in the form of Mirfield D Shares issued to him up to such
maximum number of Mirfield D Shares as represents 10% of the fully
diluted share capital of Mirfield on the following basis:
-- Following completion of the Acquisition, such number of
Mirfield D Shares as represents 5% of the fully-diluted issued
share capital of Mirfield at such date will be issued to him.
-- On the first anniversary of completion of the Acquisition,
such further number of Mirfield D Shares as represents 1.67% of the
fully-diluted issued share capital of Mirfield at such date will
automatically be issued to him.
-- On the second anniversary of completion of the Acquisition,
such further number of Mirfield D Shares as represents 1.67% of the
fully-diluted issued share capital of Mirfield at such date will
automatically be issued to him.
-- On the third anniversary of completion of the Acquisition,
such further number of Mirfield D Shares as represents 1.66% of the
fully-diluted issued share capital of Mirfield at such date will
automatically be issued to him.
-- No Mirfield D Shares will be issued to Mr Fennell on the
first, second or third anniversary of completion of the Acquisition
if, before any such date, Mr Fennell has either voluntarily
resigned or been summarily dismissed by the Company in accordance
with his service agreement.
-- If Mr Fennell has died or retired by reason of ill-health
before the first, second or third anniversary of completion of the
Acquisition when further Mirfield D Shares would have been issued
to him (or his estate), he will still be issued a proportionate
number of those Mirfield D Shares relative to the time served by
him.
-- All Mirfield D Shares issued to Mr Fennell will be issued to
him at par (i.e. at a subscription price of 1p per share) and will
be issued to him credited as fully paid by way of a capitalisation
of amounts standing to the credit of the Company's share premium
account, i.e. at no cost to Mr Fennell.
-- If at any time before the date which is the earlier of the
third anniversary of completion of the Acquisition, the date on
which Mr Fennell ceases to hold any D Shares or the date on which
Mr Fennell ceases to be engaged in the business of the Company, an
offer is made for the entire issued share capital of Mirfield and
such offer becomes unconditional in respect of at least 75% of the
share capital of Mirfield, any Mirfield D Shares not yet issued
will be issued to him immediately provided that Mr Fennell has not
either voluntarily resigned or been summarily dismissed by the
Company in accordance with his service agreement.
-- Once Mirfield D Shares have been issued to Mr Fennell he will
be entitled to retain those shares even if he subsequently ceases
to be an employee of the Company for any reason.
The Mirfield D Shares issued to Mr Fennell will be protected
against dilution during the period of 3 years after the completion
of the Acquisition provided that Mr Fennell has not either
voluntarily resigned or been summarily dismissed by the Company in
accordance with his service agreement. Following the expiry of this
period, all Mirfield D Shares will automatically be converted into
and be re-designated as Mirfield A Shares.
It is currently proposed that Louise Fennell, Mr Fennell's wife
will, conditional upon completion of the Acquisition, also be
engaged as a consultant of the Target Company in a part-time role
in public relations and as a brand ambassador for a salary of
GBP50,000 per annum.
Alasdair Hadden-Paton
Mr Hadden-Paton will, conditional upon completion of the
Acquisition, act as a Non-Executive Director for both the Target
Company and Mirfield for a fee of GBP50,000 per annum and will have
the right to receive commission of 50% of the retail margin
achieved on a sale of Target Company products to individuals
introduced to the Target Company by him.
In addition, Mr Hadden-Paton will enter into a one month
consultancy agreement to hand over his functions as chief financial
officer for a fee of GBP4,500 plus expenses. Mr Hadden-Paton will
also enter into a compromise agreement relating to the change in
his existing engagement with the Company pursuant to which he will
receive a payment of GBP20,500.
Jurek Piasecki
The services of Mr Piasecki will be made available to the
Enlarged Group to undertake the role of chief executive officer
pursuant to a consultancy agreement. To incentivise Mr Piasecki in
connection with the future business of the Company, subject to
satisfaction of performance-based targets and other conditions, Mr
Piasecki will be entitled to have sweet equity in the form of
Mirfield C Shares issued to him up to such maximum number of
Mirfield C Shares as represents 10% of the fully diluted share
capital of Mirfield on the following basis:
-- Following completion of the Acquisition, such number of
Mirfield C Shares as represents 5% of the fully-diluted issued
share capital of Mirfield at such date will be issued to him.
-- Subject to satisfaction of performance-based targets and
other conditions and provided that his services continue to be
provided to the Enlarged Group pursuant to his consultancy
agreement at the relevant time, such further number of Mirfield C
Shares as represents 2.5% of the fully-diluted issued share capital
of Mirfield will be issued to him on two further occasions after
completion of the Acquisition. If at any time before the third
anniversary of completion of the Acquisition, Mr Piasecki's
consultancy agreement has been terminated by the Company in certain
circumstances, he will be required to compulsorily offer to sell to
the holders of the Mirfield A Shares at a price of 1p per share
such number of Mirfield C Shares as represents up to 5% of the
fully-diluted issued share capital of Mirfield. However, Mr
Piasecki will be entitled to retain those Mirfield C Shares issued
to him following completion of the Acquisition even if his
consultancy agreement is terminated for any reason.
-- All Mirfield C Shares issued to Mr Piasecki will be issued to
him at par (i.e. at a subscription price of 1p per share) and will
be issued to him credited as fully paid by way of a capitalisation
of amounts standing to the credit of Mirfield's share premium
account, i.e. at no cost to him.
-- If at any time before the date which is the earlier of the
fifth anniversary of completion of the Acquisition, the date on
which Mr Piasecki ceases to hold any D Shares or the date on which
Mr Piasecki ceases to be engaged in the business of the Company, an
offer is made for the entire issued share capital of Mirfield and
such offer becomes unconditional in respect of at least 75% of the
share capital of Mirfield, any Mirfield C Shares not yet issued
will be issued to him immediately provided that he continues to
provide consultancy services to the Company.
-- The Mirfield C Shares issued to Mr Piasecki will be protected
against dilution during the period of 5 years after the completion
of the Acquisition provided that he continues to provide
consultancy services to the Company. Following the expiry of this
period, all Mirfield C Shares will automatically be converted into
and be re-designated as Mirfield A Shares.
10. The ODP Purchase
The Company currently has a 20% shareholding in The Original
Design Partnership Limited (the "ODP"), a private company making
specialised commissioned designs, managed by Mr Fennell and Mr
Hadden-Paton, who own 60% and 12% of the equity in the ODP
respectively.
Subject, inter alia, to completion of the Acquisition having
occurred on or before 31 December 2013, the Company has agreed to
acquire the outstanding 80% of the share capital in the ODP not
already owned by it, being Messrs Fennell's and Hadden-Paton's
interests, plus other minority shareholders' interests (totalling
an additional 8%), for an aggregate purchase price of GBP200,000
payable in cash. On this basis, Messrs Fennell and Hadden-Paton
will receive GBP150,000 and GBP30,000 in cash respectively. Limited
warranties and indemnities are being given by the selling
shareholders to the Company as buyer. Completion of the acquisition
of the ODP will occur simultaneously with completion of the
Acquisition. Upon completion of the ODP Purchase, the Company has
agreed to procure the repayment by ODP of its outstanding overdraft
to Clydesdale, which currently stands at approximately GBP42,000
from a maximum available facility of GBP85,000, and to procure that
Clydesdale releases Mr Fennell from his obligations and liabilities
as a guarantor of the ODP's obligations to Clydesdale.
Mr Fennell and Mr Hadden-Paton currently have outstanding
shareholder loans made by them to the ODP of GBP95,000 and
GBP10,000 respectively (the "ODP Shareholder Loans") plus accrued
interest. A further amount of GBP136,000 in aggregate is also
outstanding to Mr Fennell and Mr Hadden-Paton in respect of
outstanding and unpaid salaries (including National Insurance and
PAYE payments) (the "Unpaid Salaries").
If and to the extent that the ODP Shareholder Loans cannot be
discharged out of net cash available from cash realisations at
completion of the ODP Purchase, as part of the ODP Purchase, the
ODP will repay the ODP Shareholder Loans pro rata out of net cash
generated by the ODP in the 24 month period following completion of
the Acquisition. Any amounts still outstanding in respect of the
ODP Shareholder Loans and any Unpaid Salaries at the end of such 24
month period will be settled by a transfer to them of stock owned
by the ODP at the time (such stock being valued at cost) in full
and final settlement of all amounts which then remain under the ODP
Shareholder Loans and Unpaid Salaries. Accordingly, if and to the
extent that the ODP has insufficient stock to repay the outstanding
balance of the ODP Shareholder Loans in full, Mr Fennell and Mr
Hadden-Paton have agreed to waive any outstanding balance of their
Shareholder Loans and Unpaid Salaries. The ODP has granted Mr
Fennell a floating charge over its stock as security for its
obligations in respect of his ODP Shareholder Loan. This floating
charge will rank behind Clydesdale's own charge over the shares and
assets of the ODP pursuant to the revolving credit facility
referred to in paragraph 6 above.
As the purchase of Mr Fennell's shares in ODP will constitute a
substantial property transaction with a director for the purposes
of the Companies Act, the acquisition of his shares will be subject
to shareholder approval.
11. Brand Repatriation
Mirfield considers the "Theo Fennell" brand, as well as the
participation of Mr Fennell, as crucial to its business plan and
the success of the Acquisition. As part of the Acquisition, Mr
Fennell has entered into the Brand Repatriation Agreement pursuant
to which he has agreed, subject to completion of the Acquisition,
to assign and transfer all intellectual property rights he owns in
the business name "Theo Fennell" and associated intellectual
property to the Company as further described below.
Under the Brand Repatriation Agreement Mr Fennell:
-- unconditionally and irrevocably assigns and transfers to the
Company all intellectual property rights he owns in the business
name "Theo Fennell" and its constituent elements "Theo" and
"Fennell" (the "TF Name") in relation to the business of the
Company, all attendant goodwill and, in addition, any rights he
owns in trade marks used by the Company and other intellectual
property rights in relation to the Company's business, such as
rights in designs and ideas for products sold by the Company;
-- provides warranties to the effect that all intellectual
property rights in relation to the TF Name, trade marks and such
designs and ideas are either owned by him (and thus are being
assigned under the agreement) or are, to the best of his knowledge,
already owned by the Company or any company within the Company's
group. Mr Fennell also provides warranties to the effect that he is
not aware of any infringement issues relating to the Company's
business or of any reason why these intellectual property rights
might be vulnerable to challenge; and
-- agrees not to use the TF Name in relation to any business,
but the agreement permits him to use the TF Name to identify
himself as the author of any literary or musical work, such as a
book or song, any dramatic work, sound recording or film, or of any
two dimensional artistic work. He is permitted also to use the TF
Name to identify himself as the author or designer of any product
which is created and/or gifted by him for non-commercial purposes.
In each case, the permission is subject to the proviso that he does
so only in good faith and in a way which is not misleading.
12. The AIM Cancellation
On completion of the Acquisition, the Company will become a
wholly-owned subsidiary of Mirfield. Prior to the Scheme becoming
effective, a request will be made to the London Stock Exchange to
cancel trading in the Target Company Shares on AIM immediately
following completion of the Acquisition without seeking the
separate approval of the Target Company Shareholders under Rule 41
of the AIM Rules for Companies.
Following the AIM Cancellation, Target Company Shares will not
be quoted on any publicly quoted market in the United Kingdom or
elsewhere.
Target Company Shareholders should note the Risk Factors set out
in paragraph 2 above.
Share certificates in respect of Target Company Shares will
cease to be valid and should be destroyed upon the Scheme taking
effect. In addition, entitlements held within CREST to Target
Company Shares will be cancelled upon, or shortly after, the Scheme
taking effect. As soon as possible after completion of the
Acquisition, it is intended that the Company will be re-registered
as a private limited company.
13. Share Options
All of the outstanding options under the Target Company Approved
Employee Share Option Scheme, Unapproved Employee Share Option
Schemes and Enterprise Management Incentive Scheme (the "Option
Schemes") have an exercise price which is significantly higher than
the cash consideration per Target Company Share under the Cash
Offer. Accordingly, it is not expected that these options will be
exercised prior to the completion of the Acquisition. Mirfield has
therefore agreed with the Panel that no equivalent offer will be
made to the holders of the Option Schemes. Participants in the
Option Schemes will receive further details on the effect of the
Acquisition on their outstanding options in the separate letters
which will be despatched to them in due course.
14. Financing of Acquisition
Mirfield has received irrevocable undertakings to subscribe for
328,827 Mirfield B Shares under the terms of the Share Alternative.
Full acceptance of the Cash Offer in respect of the remaining
Target Company Shares will result in the payment by Mirfield of
approximately GBP2,427,457 in cash to Target Company Shareholders.
The Cash Consideration due under the Cash Offer will be funded by
cash from the equity subscription of Mirfield A Shares by the
Investors.
finnCap, which is advising Mirfield in relation to the cash
confirmation pursuant to Rules 2.7(d) and 24.8 of the Takeover
Code, is satisfied that resources are available to Mirfield
sufficient to satisfy in full the maximum amount of the Cash
Consideration payable under the terms of the Acquisition.
15. Opening Position Disclosures and interests
Mirfield confirms that it is making an Opening Position
Disclosure today, setting out the details required to be disclosed
by it under Rule 8.1(a) of the Takeover Code.
16. The Scheme
It is proposed that the Acquisition will be made by way of a
court-approved Scheme of Arrangement of the Target Company with the
Target Company Shareholders under Part 26 of the Companies Act,
although Mirfield reserves the right, at its sole discretion and
subject (if required) to the consent of the Panel, to seek to
implement the Acquisition by way of an offer for the entire issued
and to be issued share capital of the Company, and to make
appropriate amendments to the terms of the Acquisition arising from
the change from the Scheme to an offer.
Mr Fennell and the TF SIPP hold the same class of shares in the
Target Company as all of the other Target Company Shareholders but
in light of the availability to Mr Fennell of the 'sweet equity'
described in paragraph 9 above, the Court meeting will be for the
Target Company Shareholders other than Mr Fennell and the TF SIPP.
Mr Fennell has irrevocably undertaken that he and the TF SIPP will
agree to be bound by the Scheme.
The Scheme, which will be effected by way of a reduction of
capital of the Company, will be subject to (inter alia) each of the
following matters:
-- the approval of the Scheme at a Court-convened meeting of the
Target Company Shareholders (excluding Mr. Fennell and the TF SIPP)
by a majority in number representing at least 75% in value of such
Target Company Shareholders present and voting (whether in person
or by proxy);
-- the approval of the capital reduction at a general meeting of
the Target Company Shareholders by a special resolution of those
Target Company Shareholders present and voting (whether in person
or by proxy);
-- the approval of all other shareholders' resolutions in
connection with the Scheme at the General Meeting referred to
below;
-- the sanction of the Scheme and confirmation of the capital
reduction by the Court; and
-- the delivery of the Court orders sanctioning the Scheme and
the capital reduction to the Registrar of Companies, whereupon the
Scheme will become effective.
Upon the Scheme becoming effective:
-- the Target Company Shares will be reclassified as 'A Scheme
Shares', in respect of which the Cash Consideration will be paid
(including those Target Company Shares in respect of which an
election to receive the Share Alternative was made but which have
been scaled back) and 'B Scheme Shares', in respect of which the
Share Alternative has been validly chosen, subject to any
scale-back;
-- the 'A Scheme Shares' and 'B Scheme Shares' will be cancelled
and in their place a like number of new ordinary shares in the
capital of the Company will be issued to Mirfield, whereupon the
Company will become a wholly-owned subsidiary of Mirfield;
-- as consideration for the cancellation of the 'A Scheme
Shares' the Cash Consideration will be paid by Mirfield and as
consideration for the cancellation of the 'B Scheme Shares', one
Mirfield B Share will be issued for each 'B Scheme Share'
cancelled; and
-- the Mirfield B Shares will be issued credited as fully paid
and will rank pari passu in all respects with each other and with
the Mirfield A Shares in issue at such time, save for the
anti-dilution and other rights attaching to the Mirfield B Shares
as described in Appendix 3.
17. The Court Meeting and the General Meeting
The Acquisition (including the Scheme) will be put to Target
Company Shareholders at the Court Meeting and at the General
Meeting, which are expected to be held during September 2013.
Notices to convene the Court Meeting (subject to the consent of
the Court) and the General Meeting will be included in the Scheme
Document.
The purpose of the Court Meeting is to seek the approval of
Target Company Shareholders (other than Mr. Fennell and the TF
SIPP) for the Scheme and certain related matters.
The purpose of the General Meeting is to consider and, if
thought fit, pass the other necessary resolutions to give effect to
the Acquisition, being:
-- a special resolution to approve the reduction of capital of
the Company in connection with the Scheme;
-- a special resolution to approve amendments to the Articles of
Association of the Company in connection with and to facilitate the
Scheme;
-- a special resolution to re-register the Company as a private company;
-- an ordinary resolution of Target Company Shareholders (other
than Mr Fennell, the TF SIPP and Mr Hadden-Paton) to be taken on a
poll to approve the New Service Agreements and ancillary
arrangements with Mr Fennell and Mr Hadden-Paton and the 'sweet
equity' arrangements with Mr Fennell, for the purposes of Rule 16
of the Takeover Code;
-- an ordinary resolution of Target Company Shareholders (other
than Mr Fennell, the TF SIPP and Mr Hadden-Paton) to be taken on a
poll to approve the ODP Purchase and the Brand Repatriation
Agreement, for the purposes of Rule 16 of the Takeover Code;
and
-- ordinary resolutions of Target Company Shareholders to
approve Mr Fennell's new service contract for the purposes of
section 188 of the Companies Act and the acquisition of Mr
Fennell's shares in the ODP by the Company pursuant to the ODP
Purchase for the purposes of section 190 of the Companies Act;
Neither Mr Fennell nor the TF SIPP can vote at the Court
Meeting. Neither Mr Fennell or the TF SIPP (in relation to
arrangements with Mr Fennell) nor Mr Hadden-Paton (in relation to
arrangements with himself), nor any person acting in concert with
or connected with them, may vote on the resolutions pursuant to
Rule 16 of the Takeover Code that apply to their respective
arrangements.
Rule 16 of the Takeover Code provides that, except with the
consent of the Panel, an offeror or persons acting in concert with
it may not make any arrangements with shareholders and may not deal
or enter into arrangements to deal in shares of the offeree
company, or enter into arrangements which involve acceptance of an
offer, either during an offer or when one is reasonably in
contemplation, if there are favourable conditions attached which
are not being extended to all shareholders. An arrangement made
with a person who, while not a shareholder, is interested in shares
carrying voting rights in the offeree company will also be
prohibited by Rule 16 of the Takeover Code if favourable conditions
are attached which are not being extended to the shareholders.
Each of the arrangements with Mr Fennell and Mr Hadden-Paton
outlined in paragraphs 9, 10 and 11 constitutes an arrangement with
a shareholder of the Company made when the Acquisition was
reasonably in contemplation and to which favourable conditions are
attached which are not being extended to all Target Company
Shareholders.
The Panel has confirmed to finnCap that it consents to these
arrangements with Mr Fennell and Mr Hadden-Paton provided that such
arrangements are approved by Target Company Shareholders (other
than Mr Fennell, the TF SIPP and Mr Hadden-Paton and any person
acting in concert with them or connected with them) in general
meeting. The vote must be taken on a poll.
Target Company Shareholders should note that completion of the
Acquisition will be conditional upon passing of all the above
resolutions.
18. Expected timetable for posting of the Scheme Document
It is expected that the Scheme Document, which will include
notices to convene the Court Meeting and the General Meeting, will
be posted to Target Company Shareholders during August 2013 (and,
in any event, within 28 days of this announcement, unless otherwise
agreed with the Panel) and that the Scheme will become effective in
October 2013, subject to the satisfaction of the Conditions.
19. Overseas Persons
The availability of Mirfield B Shares under the Share
Alternative to persons not resident in the United Kingdom may be
affected by the laws of the relevant jurisdiction. Such persons
should inform themselves about and observe any applicable
requirements. Further details in relation to Overseas Persons will
be contained in the Scheme Document.
20. Irrevocable undertakings
Independent Directors
Irrevocable undertakings to vote, or procure the vote, in favour
of all of the Resolutions to be proposed at the Meetings have been
received from Rupert Hambro and Francis McKay in respect of their
entire beneficial holdings of Target Company Shares amounting, in
aggregate, to 1,657,538 Target Company Shares, which represents
approximately 7.2 per cent. of the existing issued share capital of
the Company.
Theo Fennell and Alasdair Hadden-Paton
An irrevocable undertaking has been received from Mr Fennell to
consent to be bound by the Scheme and to vote, or procure the vote,
in favour of all the Resolutions to be proposed at the General
Meeting other than those in respect of which he is not entitled to
vote (being the resolutions to approve the arrangement with
himself, for the purposes of Rule 16 of the Code) in respect of his
entire beneficial holding of Target Company Shares amount to
3,750,279 Target Company Shares which represent 16.2 per cent. of
the existing issued share capital of the Company.
An irrevocable undertaking has been received from Alasdair
Hadden-Paton to vote, or procure the vote, in favour of all of the
Resolutions to be proposed at the Meetings other than those in
respect of which he is not entitled to vote (being the resolution
to approve the arrangements with himself, for the purposes of Rule
16 of the Takeover Code) in respect of his entire beneficial
holdings of Target Company Shares amounting to 866,626 Target
Company Shares, which represent 3.7 per cent. of the existing
issued share capital of the Company.
Each of Mr Fennell and Mr Hadden-Paton has also undertaken to
elect to receive the Share Alternative in full in respect of his
entire beneficial holding of Target Company Shares (other than, in
the case of Mr Fennell, the Target Company Shares held by the TF
SIPP), which will equate to a maximum of 328,827 Mirfield B Shares,
representing approximately 53.8% of the Mirfield B Shares that will
be available to be issued on completion of the Scheme, assuming
that no other Target Company Shareholders elect to receive the
Share Alternative.
Other Shareholders
Irrevocable undertakings have been received from each of Centric
Investments Limited, Francis Richard Northcott and Lodestone
Limited to vote, or procure the vote, in favour of all of the
Resolutions to be proposed at the Meetings in respect of their
entire beneficial holdings of Target Company Shares amounting, in
aggregate, to 5,225,903 Target Company Shares, which represents
approximately 22.6 per cent. of the existing issued share capital
of the Company. Further details of these irrevocable undertakings
are set out in Appendix 4.
Each of the above irrevocable undertakings will cease to be
binding only if the Acquisition (or, if made, a takeover offer)
lapses or is withdrawn at any time (but will continue to bind if
the Acquisition is changed from the Scheme to an offer) or if the
Scheme Document if not posted within 28 days of the date of this
Announcement.
21. Recommendations
The board of directors of the Company has determined that Messrs
Fennell and Hadden-Paton are not independent for the purposes of
considering and recommending the Acquisition due to their proposed
participation in Mirfield following completion of the Acquisition.
Accordingly, it has been agreed that Rupert Hambro and Francis
McKay will be the Independent Directors for the purposes of the
Takeover Code and the AIM Rules.
The Independent Directors, who have been so advised by Opus
Corporate Finance LLP, consider the terms of the Acquisition to be
fair and reasonable. However, the Independent Directors do not
express any view on the terms of the Share Alternative. In
providing its advice to the Independent Directors, Opus Corporate
Finance LLP has taken into account the commercial assessments of
the Independent Directors.
For the purpose of Rule 16 of the Takeover Code, Opus Corporate
Finance LLP considers the terms of the ODP Purchase, the Brand
Repatriation Agreement, the New Service Agreements and the "sweet
equity" arrangements for Mr Fennell described in paragraph 9 above
to be fair and reasonable insofar as the Independent Shareholders
are concerned.
The ODP purchase by the Company is a related party transaction
under AIM Rule 13. The Independent Directors of the Company, having
consulted with Cantor Fitzgerald Europe, consider that the ODP
Purchase is fair and reasonable in so far as the Independent
Shareholders are concerned. Accordingly, the Independent Directors
intend unanimously to recommend that Target Company Shareholders
vote in favour of the Resolutions to be proposed at the Court
Meeting and the General Meeting.
22. Documents on display
Copies of the following documents, will by no later than 12 noon
on 2 August 2013 be published on EME Capital's website
(www.eme-capital.com):
-- a copy of this announcement;
-- the irrevocable undertakings listed in Appendix 4;
-- the subscription agreements relating to the financing of the
Acquisition as referred to in paragraph 14 above; and
-- the commitment letter from Clydesdale as referred to in paragraph 6 above.
Appendix 1
DEFINITIONS
In this Announcement the following words and expressions have
the following meanings unless the context requires otherwise:
"Acquisition" the recommended cash offer,
with a share alternative, to
be made by Mirfield for the
whole of the issued and to
be issued ordinary share capital
of the Company whether undertaken
by way of the Scheme or alternatively
by way of a takeover offer
under the Takeover Code
"AIM" the AIM market operated by
the London Stock Exchange plc
"AIM Cancellation" the cancellation of the admission
of the Company's ordinary shares
to trading on AIM
"Announcement" this announcement
"Board" the board of directors of the
Target Company
"Brand Repatriation Agreement" the agreement relating to the
"Theo Fennell" brand described
in paragraph 11 of this Announcement
"Business Day" a day, other than a Saturday,
Sunday or public holiday, on
which banks are open for non-automated
business in the City of London
"Cash Consideration" the entitlement for Target
Company Shareholders under
the terms of the Acquisition
to receive 12.5p in cash in
consideration for each Target
Company Share
"Cash Offer" the offer by Mirfield to the
Target Company Shareholders
to acquire their Target Company
Shares for the Cash Consideration
"Companies Act" or "Act" the Companies Act 2006, as
amended
"Court" the High Court of Justice in
England and Wales
"Conditions" the conditions of the Acquisition
set out in Appendix 2 of this
Announcement
"Court Meeting" the meeting of Target Company
Shareholders (other than Mr
Fennell and the TF SIPP) to
be convened by order of the
Court under section 896 of
the Act for the purposes of
considering and, if thought
fit, approving the Scheme (with
or without amendment), and
any adjournment thereof
"Clydesdale" Clydesdale Bank plc
"EME Capital" EME Capital LLP
"Enlarged Group" Mirfield as enlarged by the
acquisition of the Target Company
and ODP, subject to the Scheme
becoming effective
"finnCap" finnCap Limited
"Form of Election" the form of election for use
by Shareholders to make the
Share Election in respect of
the Share Alternative
"Form(s) of Proxy" the forms of proxy for use
by Shareholders in connection
with the Court Meeting and
the General Meeting
"General Meeting" the meeting of Target Company
Shareholders to be convened
for the purposes of considering
and, if thought fit, approving
the capital reduction associated
with the Scheme and other resolutions
ancillary to the Scheme, and
any adjournment thereof
"Independent Directors" Rupert Hambro and Francis McKay
"Independent Shareholders" Target Company Shareholders
other than Mr Fennell, the
TF SIPP, and Mr Hadden-Paton
"Investors" the subscribers for Mirfield
A Shares as set out in paragraph
5 of this Announcement
"Meetings" the General Meeting and the
Court Meeting
"Mirfield" Mirfield 1964 plc, a public
limited company having registered
number 8564652 and with a registered
office at 3 Bunhill Row, London
EC1Y 8YZ
"Mirfield Director" means a director of Mirfield
"Mirfield A Share(s)" the A ordinary shares of GBP0.01
each in the capital of Mirfield
which have the rights set out
in the Articles of Mirfield,
to be issued to the founders
of Mirfield
"Mirfield B Share(s)" the B ordinary shares of GBP0.01
each in the capital of Mirfield
which have the rights set out
in the Articles of Mirfield,
to be issued to Target Company
Shareholders who accept the
Share Alternative
"Mirfield C Share(s)" the C ordinary shares of GBP0.01
each in the capital of Mirfield
which have the rights set out
in the Articles of Mirfield,
to be issued to Mr Piasecki
pursuant to his "sweet equity"
arrangements described in paragraph
9 above
"Mirfield D Share(s)" the D ordinary shares of GBP0.01
each in the capital of Mirfield
which have the rights set out
in the Articles of Mirfield,
to be issued to Mr Fennell
pursuant to his "sweet equity"
arrangements described in paragraph
9 above
"Mirfield Share(s)" all or any ordinary share(s)
in Mirfield, being the Mirfield
A Shares, Mirfield B Shares,
Mirfield C Shares and the Mirfield
D Shares
"Mr Hadden-Paton" Mr Alasdair Hadden-Paton
"Mr Fennell" Mr Theo Fennell
"New Service Agreements" the new directors' contracts
entered into between Mr Fennell,
Mirfield and the Company and
the letter of appointment and
the consultancy agreement entered
into by Mr Hadden-Paton, Mirfield
and the Company, and the compromise
agreement between the Company
and Mr Hadden-Paton, in each
case conditional on completion
of the Acquisition
"ODP" The Original Design Partnership
Limited
"ODP Purchase" the acquisition by the Company
of the shares in ODP not already
owned by it
"Overseas Shareholders" Target Company Shareholders
(or nominees, or custodians
or trustees of Target Company
Shareholders) who are resident
in, or nationals or citizens
of jurisdictions outside the
UK or who are citizens or residents
of countries other than the
UK
"Panel" The Panel on Takeovers and
Mergers
"Resolutions" each of the resolutions (where
applicable) as described in
paragraph 16 of the Announcement
"Restricted Jurisdictions" any jurisdictions where making
the Share Alternative available
would constitute a violation
of the relevant laws and regulations
of such jurisdiction or would
result in a requirement to
comply with any governmental
or other consent or any registration,
filing or other formality which
Mirfield or the Company regards
as unduly onerous
"Scheme" the proposed scheme of arrangement
in relation to the Scheme under
Part 26 of the Companies Act
2006 between the Company and
its shareholders as described
in this document
"Scheme Document" the document to be sent to
Shareholders in relation to
the Scheme in accordance with
Part 26 of the Companies Act
"Scheme Record Time" 6pm on the Business Day immediately
preceding the court hearing
to confirm the reduction of
capital
"Share Alternative" the alternative whereby Target
Company Shareholders (other
than Overseas Shareholders
in Restricted Jurisdictions)
may elect (subject to scale
back) to receive 0.08796 unlisted
Mirfield B Shares in consideration
for each Target Company Share
as an alternative to the Cash
Offer
"Share Election" the election by a Target Company
Shareholder to accept the Share
Alternative
"Takeover Code" the City Code on Takeovers
and Mergers
"Target Company" or "Company" Theo Fennell Plc
"Target Company Share(s)" an ordinary share of GBP0.05
in the Company
"Target Company Shareholders" the holders of ordinary shares
or "Shareholders" in the Company
"Target Company Director" means a director of the Target
Company
"TF SIPP" Mr Fennell's self invested
personal pension
"Voting Record Time" the time and date specified
in the Scheme Document by reference
to which entitlement to vote
in the Court Meeting will be
determined
"Wider Company Group" the Company and ODP.
For the purposes of this Announcement, "subsidiary" has the
meaning given to such term in the Act.
Appendix 2
CONDITIONS AND CERTAIN FURTHER TERMS OF THE OFFER
1. The Acquisition is conditional upon the Scheme, subject to
the Takeover Code, becoming unconditional and becoming effective by
no later than 31 December 2013 or such later date (if any) as
Mirfield and the Company may, with the consent of the Panel, agree
and (if required) the Court may approve.
2. The Scheme is subject to the following Conditions:
(a) the approval of the Scheme by a majority in number
representing three-fourths or more in value of the Target Company
Shareholders (or, if applicable, the relevant class or classes
thereof) present and voting, either in person or by proxy, at the
Court Meeting and at any separate class meeting which may be
required by the Court (or at any adjournment of any such
meeting);
(b) all resolutions required to approve and implement the Scheme
as set out in the notice of the General Meeting in the Scheme
Document (when issued) being duly passed by the requisite
majorities at the General Meeting (or at any adjournment thereof);
and
(c) the sanction of the Scheme and the confirmation of the
reduction of capital of the Company in connection with the Scheme
by the Court (in each case without modification or with such
modification as is agreed by Mirfield and the Company) and the
delivery for registration of each of the Court Orders to the
Registrar of Companies in England and Wales and, if so ordered by
the Court in order to take effect, the registration by the
Registrar of Companies in England and Wales, in relation to the
reduction of capital of the Company in connection with the Scheme,
of such Court Order.
3. In addition, the Company and Mirfield have agreed that, save
as stated in paragraph 5 below, the Scheme is conditional on the
following matters and, accordingly, the necessary actions to make
the Acquisition effective will not be taken unless the following
Conditions (as amended, if appropriate) have been satisfied or
waived:
(a) no Third Party (as defined below) having intervened and
there not continuing to be outstanding any statute, regulation or
order of any Third Party in each case which is or is likely to be
material in the context of the Acquisition which would or might
reasonably be expected to:
(i) make the Scheme, its implementation or the acquisition or
proposed acquisition by Mirfield of any shares or other securities
in, or control of, the Company or any member of the Wider Company
Group void, illegal or unenforceable in any jurisdiction, or
otherwise directly or indirectly restrain, prevent, prohibit,
restrict or delay the same or impose additional conditions or
obligations with respect to the Scheme or such acquisition, or
otherwise impede, challenge or interfere with the Scheme or such
acquisition, or require amendment to the terms of the Scheme or the
acquisition or proposed acquisition of any the Target Company
Shares or the acquisition of control or management of the Company
or the Wider Company Group by Mirfield;
(ii) limit or delay, or impose any material limitations on, the
ability of Mirfield to acquire or to hold or to exercise
effectively, directly or indirectly, all or any rights of ownership
in respect of shares or other securities convertible into the
Target Company Shares in, or to exercise voting or management
control over, any member of the Wider Company Group;
(iii) require, prevent or delay the divestiture or alter the
terms envisaged for any proposed divestiture by Mirfield of any
shares or other securities in the Company;
(iv) require, prevent or delay the divestiture or alter the
terms envisaged for any proposed divestiture by any member of the
Wider Company Group or by Mirfield of all or any portion of their
respective businesses, assets or properties or limit the ability of
any of them to conduct any of their respective businesses or to own
or control any of their respective assets or properties or any part
thereof;
(v) except pursuant to sections 974-991 of the Act require
Mirfield or any member of the Wider Company Group to acquire, or to
offer to acquire, any shares or other securities (or the
equivalent) in any member of the Wider Company Group owned by any
third party;
(vi) limit the ability of Mirfield or any member of the Wider
Company Group to conduct or integrate or co-ordinate its business,
or any material part of it, with the businesses or any part of the
businesses of Mirfield or any member of the Wider Company
Group;
(vii) result in any member of the Wider Company Group or
Mirfield ceasing to be able to carry on business under any name
under which it presently does so; or
(viii) otherwise adversely affect any or all of the business,
assets, profits, financial or trading position or prospects of
Mirfield or any member of the Wider Company Group in each such case
to the extent that it is material in the context of the Wider
Company Group and/or Mirfield taken as a whole, and all applicable
waiting and other time periods during which any Third Party could
intervene under the laws of any relevant jurisdiction having
expired, lapsed or been terminated;
(b) all notifications and filings which are necessary or are
reasonably considered appropriate by Mirfield having been made, all
appropriate waiting and other time periods (including any
extensions of such waiting and other time periods) under any
applicable legislation or regulation of any relevant jurisdiction
having expired, lapsed or been terminated (as appropriate) and all
statutory or regulatory obligations in any relevant jurisdiction
having been complied with or obtained on terms and in a form
reasonably satisfactory to Mirfield, in each case (and to the
extent that it is material) in connection with the Scheme or the
Acquisition or the acquisition or the proposed acquisition of any
shares or other securities in, or control or management of, the
Company or any other member of the Wider Company Group or the
carrying on by any member of the Wider Company Group of its
business, unless otherwise waived by Mirfield, and no temporary
restraining order, preliminary or permanent injunction or other
order having been issued and being in effect by a court or other
Third Party of competent jurisdiction which has the effect of
making the Scheme or the Acquisition illegal or otherwise
prohibiting the consummation of the Scheme or the Acquisition;
(c) all Authorisations which are necessary or are reasonably
considered necessary or appropriate by Mirfield in any relevant
jurisdiction for or in respect of the Scheme or the Acquisition or
the acquisition or proposed acquisition of any shares or other
securities in, or control or management of, the Company or any
other member of the Wider Company Group or by Mirfield or the
carrying on by Mirfield or any member of the Wider Company Group of
its business having been obtained, in terms and in a form
reasonably satisfactory to Mirfield, from all appropriate Third
Parties or from any persons or bodies with whom any member of the
Wider Company Group has entered into contractual arrangements and
all such Authorisations remaining in full force and effect and
there being no notice or intimation of any intention to revoke,
suspend, restrict, modify or not to renew any of the same in
connection with the Scheme or the Acquisition;
(d) since 31 March 2013 and except as disclosed in the Company's
annual report and accounts for the year then ended or as publicly
announced by the Company prior to the date of the Announcement (by
the delivery of an announcement to a Regulatory Information
Service) or as fairly disclosed prior to the date of the
Announcement to Mirfield by or on behalf of the Company in the
course of negotiations, there being no provision of any
arrangement, agreement, licence, permit, franchise or other
instrument to which any member of the Wider Company Group is a
party, or by or to which any such member or any of its assets is or
are or may be bound, entitled or subject or any circumstance,
which, in each case as a consequence of the Scheme or the
Acquisition or the acquisition or proposed acquisition of any
shares or other securities in, or control of, the Company or any
other member of the Wider Company Group by Mirfield or otherwise,
could or might reasonably be expected to result in:
(i) any monies borrowed by or any other indebtedness or
liabilities (actual or contingent) of, or any grant available to,
any member of the Wider Company Group being or becoming repayable
or capable of being declared repayable immediately or prior to its
stated repayment date or the ability of any member of the Wider
Company Group to borrow monies or incur any indebtedness being
withdrawn or inhibited or becoming capable of being withdrawn;
(ii) the creation or enforcement of any mortgage, charge or
other security interest over the whole or any part of the business,
property, assets or interests of any member of the Wider Company
Group or any such mortgage, charge or other security interest
(wherever created, arising or having arisen) becoming
enforceable;
(iii) any such arrangement, agreement, licence, permit,
franchise or other instrument, or the rights, liabilities,
obligations or interests of any member of the Wider Company Group
thereunder, being, or becoming capable of being, terminated or
adversely modified or affected or any adverse action being taken or
any obligation or liability arising thereunder;
(iv) any material asset or material interest of any member of
the Wider Company Group being or failing to be disposed of or
ceasing to be available to any member of the Wider Company Group or
any right arising under which any such asset or interest could be
required to be disposed of or could cease to be available to any
member of the Wider Company Group otherwise than in the ordinary
course of business;
(v) any member of the Wider Company Group ceasing to be able to
carry on business under any name under which it presently does
so;
(vi) the creation of material liabilities (actual or contingent)
by any member of the Wider Company Group other than in the ordinary
course of business;
(vii) the rights, liabilities, obligations or interests of any
member of the Wider Company Group under any such arrangement,
agreement, licence, permit, franchise or other instrument or the
interests or business of any such member in or with any other
person, firm, company or body (or any arrangement or arrangements
relating to any such interests or business) being terminated or
adversely modified or affected; or
(viii) the financial or trading position or the prospects or the
value of any member of the Wider Company Group being prejudiced or
adversely affected; and
(ix) except as aforesaid, no event having occurred which, under
any provision of any such arrangement, agreement, licence, permit
or other instrument, would be reasonably likely to result in any of
the events or circumstances which are referred to in paragraphs (i)
to (viii) of this Condition 3(d);
(e) since 31 March 2013 and except as disclosed in the Company's
annual report and accounts for the year then ended or as otherwise
publicly announced by the Company prior to the date of the
Announcement (by the delivery of an announcement to a Regulatory
Information Service) or as otherwise fairly disclosed prior to the
Announcement in writing to Mirfield by or on behalf of the Company
in the course of negotiations or otherwise as a result of the
Acquisition no member of the Wider Company Group having:
(i) issued or agreed to issue, or authorised the issue of,
additional shares of any class, or securities convertible into or
exchangeable for, or rights, warrants or options to subscribe for
or acquire, any such shares or convertible securities or
transferred or sold any shares out of treasury other than: (i) as
between the Company and wholly owned subsidiaries of the Company;
or (ii) any shares issued upon the exercise of any options granted
under the Company Option Schemes;
(ii) purchased or redeemed or repaid any of its own shares or
other securities or reduced or made any other change to any part of
its share capital;
(iii) recommended, declared, paid or made any dividend or other
distribution whether payable in cash or otherwise or made any bonus
issue (other than to the Company or a wholly-owned subsidiary of
the Company);
(iv) except as between the Company and its wholly-owned
subsidiaries or between such wholly-owned subsidiaries made or
authorised any material change in its loan capital;
(v) (other than any acquisition or disposal in the ordinary
course of business or a transaction between the Company and a
wholly-owned subsidiary of the Company or between such wholly-owned
subsidiaries) merged with, demerged or acquired any body corporate,
partnership or business or acquired or disposed of or transferred,
mortgaged, charged or created any security interest over any assets
or any right, title or interest in any assets (including shares in
any undertaking and trade investments) or authorised the same (in
each case to an extent which is material in the context of the
Company Group taken as a whole);
(vi) issued, agreed to issue or authorised the issue of, or made
any change in or to, any debentures or (except in the ordinary
course of business or except as between the Company and its
wholly-owned subsidiaries or between such wholly-owned
subsidiaries) incurred or increased any indebtedness or liability
(actual or contingent) which in any case is material in the context
of the Wider Company Group taken as a whole;
(vii) entered into, varied, or authorised any agreement,
transaction, arrangement or commitment (whether in respect of
capital expenditure or otherwise) which (A) is of a long term,
onerous or unusual nature or magnitude or which is reasonably
likely to involve an obligation of such nature or magnitude; or (B)
is reasonably likely to restrict the business of any member of the
Wider Company Group, and which in any case is material in the
context of the Wider Company Group taken as a whole;
(viii) except as between the Company and its wholly-owned
subsidiaries or between such wholly-owned subsidiaries entered
into, implemented, effected or authorised any merger, demerger,
reconstruction, amalgamation, scheme, commitment or other
transaction or arrangement in respect of itself or another member
of the Wider Company Group, which in any case is material in the
context of the Wider Company Group taken as a whole;
(ix) entered into or varied the terms of, any contract,
agreement or arrangement with any of the directors or senior
executives of any member of the Wider Company Group;
(x) save in relation to the Scheme, taken any corporate action
or had any legal proceedings instituted against it or petition
presented, or meeting convened or order made for its winding-up
(voluntarily or otherwise), dissolution or reorganisation or a
notice of intention to appoint an administrator is filed at court
or application to appoint an administrator is made to the court, or
any step is taken for the appointment of a receiver, administrator,
administrative receiver, trustee or similar officer of all or any
material part of its assets and revenues or any analogous
proceedings in any jurisdiction or appointed any analogous person
in any jurisdiction which in any case is material in the context of
the Wider Company Group taken as a whole; been unable, or admitted
in writing that it is unable, to pay its debts 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;
(xi) waived or compromised any claim, which is material in the
context of the Wider Company Group taken as a whole;
(xii) made any alteration to its memorandum or articles of
association which is material in the context of the Scheme or the
Acquisition;
(xiii) other than as a result of the Acquisition, proposed,
agreed to provide or modified the terms of any share option scheme,
incentive scheme or other benefit (including in relation to any
personal defined contribution pension scheme(s) of any director or
any person employed by the Wider Company Group) relating to the
employment or termination of employment of any person employed by
the Wider Company Group; or
(xiv) other than as a result of the Acquisition, entered into
any agreement, commitment or arrangement or passed any resolution
or made any offer (which remains open for acceptance) or proposed
or announced any intention with respect to any of the transactions,
matters or events referred to in this Condition 3(e);
(f) since 31 March 2013 and except as disclosed in the Company's
annual report and accounts for the year then ended or as otherwise
publicly announced by the Company prior to the Announcement (by the
delivery of an announcement to a Regulatory Information Service) or
as otherwise fairly disclosed prior to the date of the Announcement
in writing to Mirfield by or on behalf of the Company in the course
of negotiations:
(i) there having been no adverse change or deterioration in the
business, assets, financial or trading positions or profit or
prospects of any member of the Wider Company Group which in any
case is material in the context of the Wider Company Group taken as
a whole;
(ii) no contingent or other liability of any member of the Wider
Company Group having arisen or become apparent or increased which
in any case is material in the context of the Wider Company Group
taken as a whole;
(iii) no litigation, arbitration proceedings, prosecution or
other legal proceedings to which any member of the Wider Company
Group is or may become a party (whether as plaintiff, defendant or
otherwise) having been threatened, announced, implemented or
instituted by or against or remaining outstanding against or in
respect of any member of the Wider Company Group which in any case
is material in the context of the Wider Company Group taken as a
whole; and
(iv) (other than as a result of the Scheme or the Acquisition)
no enquiry or investigation by, or complaint or reference to, any
Third Party having been threatened, announced, implemented,
instituted by or against or remaining outstanding against or in
respect of any member of the Wider Company Group which in any case
is material in the context of the Wider Company Group taken as a
whole; and
(g) Mirfield not having discovered, other than to the extent
otherwise publicly announced by the Company prior to the
Announcement (by the delivery of an announcement to a Regulatory
Information Service) or otherwise fairly disclosed prior to the
date of the Announcement in writing to Mirfield by or on behalf of
the Company in the course of negotiations:
(i) that any financial or business or other information
concerning the Wider Company Group disclosed at any time by or on
behalf of any member of the Wider Company Group, whether publicly
or Mirfield, is misleading or contains any misrepresentation of
fact or omits to state a fact necessary to make any information
contained therein not misleading to an extent which in any case is
material in the context of the Wider Company Group taken as a
whole;
(ii) that any member of the Wider Company Group is subject to
any liability (actual or contingent) which is not disclosed in the
Company's annual report and accounts for the financial year ended
31 March 2013 and which in any case is material in the context of
the Wider Company Group taken as a whole; or
(iii) any information which affects the import of any
information disclosed at any time by or on behalf of any member of
the Wider Company Group to an extent which is material in the
context of the Wider Company Group taken as a whole.
(h) the passing of ordinary resolutions of independent Target
Company Shareholders to be taken on a poll to approve the
arrangements with Mr Fennell and Mr Hadden-Paton, as summarised in
paragraphs 9, 10 and 11 above, for the purposes of Rule 16 of the
Takeover Code.
4. If the Panel requires Mirfield to make an offer for the
Target Company Shares under the provisions of Rule 9 of the
Takeover Code, Mirfield may make such alterations to the conditions
of the Acquisition, including to the Conditions set out in
paragraph 2 of this Appendix 1 of this document, as are necessary
to comply with the provisions of that Rule.
5. Except with the Panel's consent, Mirfield will not invoke any
of the above Conditions (except Condition 2) so as to cause the
Acquisition not to proceed, unless the circumstances that give rise
to the right to invoke the relevant Condition are of material
significance in the context of the Acquisition. For the avoidance
of doubt, the insolvency Condition stipulated at 3(e)(x) is
considered of material significance in the context of the
Acquisition.
6. Mirfield reserves the absolute right to elect, subject to the
prior consent of the Panel, to implement the Acquisition by way of
a takeover offer in accordance with the Takeover Code as it may
determine in its absolute discretion. In such event, such offer
will be implemented on the same terms (subject to appropriate
amendment, including (without limitation) an acceptance condition
set at 90 per cent. (or such lesser percentage (being more than 50
per cent.) as Mirfield may decide or the Panel may require) of the
Target Company Shares to which such offer would relate), so far as
applicable, as those which would apply to the Scheme.
7. Target Company Shares will be acquired by Mirfield fully paid
and free from all liens, equitable interests, charges, encumbrances
and other third party rights of any nature whatsoever and together
with all rights attaching to them, including the right to receive
and retain all dividends and distributions (if any) declared, made
or payable after the date on which the Scheme becomes
effective.
8. The Acquisition will be on the terms and will be subject,
amongst other things, to the Conditions which will be set out in
the Scheme Document (when issued) and accompanying Forms of Proxy
and such further terms as may be required to comply with the AIM
Rules, the provisions of the Takeover Code and the provisions of
the Companies Act. The Scheme will be governed by the laws of
England and Wales.
9. The availability of the Acquisition 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.
10. All of the Conditions set out in paragraph 3 of this
Appendix 2 must be fulfilled, be determined by Mirfield to be or
remain satisfied or (if capable of waiver) be waived by the Scheme
Record Time, failing which the Acquisition will lapse. Subject to
the requirements of the Panel, Mirfield reserves the right to waive
all or any of the Conditions in paragraphs 3(a) to 3(g) (inclusive)
of this Appendix 2 in whole or part. Mirfield 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 the Conditions in
paragraphs 3(a) to 3(g) (inclusive) of this Appendix 2 by a date
earlier than the date specified in paragraph 1 of this Appendix 2
above for the fulfilment thereof, notwithstanding that the other
Conditions of the Acquisition 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.
11. For the purpose of these Conditions:
(a) "Third Party" means any central bank, government, government department or governmental, quasi-governmental, supranational, statutory, regulatory or investigative body, authority (including any national anti-trust or merger control authority), court, trade agency, association, institution or professional or environmental body or any other person or body whatsoever in any relevant jurisdiction;
(b) a Third Party shall be regarded as having "intervened" if it
has decided to take, institute, implement or threaten any action,
proceeding, suit, investigation, enquiry or reference or made,
proposed or enacted any statute, regulation, decision or order or
taken any measures or other steps or required any action to be
taken or information to be provided or otherwise having done
anything and "intervene" shall be construed accordingly; and
(c) "Authorisations" means authorisations, orders, grants,
recognitions, determinations, certificates, confirmations,
consents, licences, clearances, provisions and approvals.
Appendix 3
TERMS AND CONDITIONS OF THE SHARE ALTERNATIVE
RIGHTS ATTACHING TO THE MIRFIELD A SHARES AND MIRFIELD B
SHARES
Part 1
Terms and Conditions of the Share Alternative
A Share Alternative will be made available to the Target Company
Shareholders so that Target Company Shareholders (other than
Overseas Shareholders in Restricted Jurisdictions) may elect to
receive Mirfield B Shares, instead of the Cash Consideration to
which they would otherwise become entitled upon completion of the
Acquisition, subject to the Maximum Share Amount (as defined
below). Subject to any scale back, as explained below, to the
extent that a Target Company Shareholder elects to receive the
Share Alternative in respect of his Target Company Shares, he will
receive Mirfield B Shares on the following basis:
for every Target Company Share 0.08796 Mirfield B Shares
Mirfield B Shares issued pursuant to the Acquisition will be
issued credited as fully paid and will have the rights set out in
Mirfield's Articles of Association. Target Company Shareholders
should note that the Mirfield B Shares have different rights to the
Mirfield A Shares, that are currently held by Mirfield Shareholders
and that will be issued to investors pursuant to the arrangements
set out in paragraph 5 of this Announcement and to the C Shares and
D Shares that will be issued to Mr Fennell and Mr Piasecki pursuant
to the arrangements summarized in paragraph 9 of this Announcement.
Further details of the rights attaching to the Mirfield B Shares
are set out in part 2 of this Appendix 3.
Fractions of Mirfield B Shares will not be allotted of issued
pursuant to the Scheme to Target Company Shareholders and
entitlements will instead by rounded down to the nearest whole
number of Mirfield B Shares.
Target Company Shareholders who do not elect to receive the
Share Alternative will receive the Cash Consideration under the
terms of the Acquisition in respect of all of their Target Company
Shares.
The total number of Mirfield B Shares that may be issued under
the Scheme (the "Maximum Share Amount") is 611,111 Mirfield B
Shares representing up to 10% of the issued share capital of
Mirfield immediately following the Scheme becoming effective. The
Maximum Share Amount will not be varied as a result of elections
under the Share Alternative. This means that the Share Alternative
will be available in respect of a maximum of 6,947,601 Target
Company Shares which is equivalent to 30% of the issued share
capital of Target Company as at the close of business on the last
Business Day prior to the date of publication of this
Announcement.
If the maximum Share Alternative is not sufficient to satisfy
all valid Share Elections for the Share Alternative in full,
entitlements will be scaled back pro rata (in proportion to the
number of shares in respect of which valid Share Elections for the
Share Alternative are made). To the extent that, following such
scale back, any Target Company Shareholder does not receive
Mirfield B Shares in respect of all the Target Company Shares which
are the subject of his election for the Share Alternative, he will
instead receive the Cash Consideration for the remaining Target
Company Shares.
As a result, Target Company Shareholders who elect for the Share
Alternative will not know the exact number of Mirfield B Shares or
the amount of cash (if any) they will receive until settlement of
the Consideration due to them in respect of the Offer.
The Share Alternative will not be available to Overseas
Shareholders in Restricted Jurisdictions.
Part 2
The Mirfield B Shares to be issued pursuant to the Share
Alternative will be B ordinary shares of 1p each in the capital of
Mirfield. The Mirfield B Shares will be issued free from all liens,
charges, encumbrances and other third party rights and/or interests
of any nature whatsoever. The Mirfield B Shares will be issued in
registered form, may only be held in certificated form, will be
issued credited as fully paid and will rank pari passu with the
Mirfield A Shares, Mirfield C Shares and Mirfield D Shares in all
respects save that the holders of the Mirfield B Shares will be
protected against dilution for the period of 2 years after the
completion of the Acquisition and the Mirfield C Shares and the
Mirfield D Shares shall have the rights set out in paragraph 9 of
this Announcement. Accordingly, the percentage (up to a maximum
percentage of 10% if the Maximum Share Amount is issued as a result
of valid elections for the Share Alternative under the Acquisition)
which the Mirfield B Shares represent of the enlarged issued share
capital of Mirfield immediately following completion of the
Acquisition will not be decreased during this period. At the end of
the 2 year period each Mirfield B Share will automatically convert
into and be re-designated as a Mirfield A Share.
If any further Mirfield A Shares, Mirfield C Shares and/or
Mirfield D Shares are issued during this two year period,
additional Mirfield B Shares will be issued pro rata to the holders
of the Mirfield B Shares at par, credited as fully paid, by way of
a capitalisation of amounts standing to the credit of the Company's
share premium account (i.e. at no cost to the holders of the
Mirfield B Shares) so as to maintain the percentage shareholding in
the Company held by the holders of the Mirfield B Shares.
However, the Mirfield B Shares will be diluted by any further
Mirfield A Shares, Mirfield C Shares and/or Mirfield D Shares
issued after the expiry of this two year period, including any
"sweet equity" in the form of Mirfield C Shares and Mirfield D
Shares issued to Mr Piasecki and Mr Fennell respectively after the
expiry of this two year period and by any Mirfield A Shares issued
to EME Capital upon the exercise of its warrants after the expiry
of this two year period or if the exercise of its warrants is
accelerated. For the avoidance of doubt, the tranche of Mr
Fennell's "sweet equity", consisting of the issue of such further
number of Mirfield D Shares as represents 1.67% of the
fully-diluted issued share capital of Mirfield on the second
anniversary of completion of the Acquisition, will not have the
effect of diluting the Mirfield B Shares on such issue.
The Articles of Association of Mirfield contain restrictions on
the transfer of Shares.
A holder of Shares of any class is entitled to transfer shares
to certain permitted transferees. A body corporate is entitled to
transfer its shares to another member of the same group. An
individual is entitled to transfer his shares to certain family
members and/or the trustees of trust for such family members.
Shares transferred in this way must be transferred back to the
original holder or another permitted transferee if the original
transferee ceases to qualify as a permitted transferee.
Subject to the above, shares may be transferred in compliance
with pre-emption rights or with the prior written consent of the
holders of at least 75% of the Mirfield A Shares by value.
A holder of Shares of any class is required to offer all of his
Shares for sale at the appraised fair value of such shares if he
creates a security interest over any of his shares or a specified
insolvency event occurs in relation to him.
The Articles of Association of Mirfield contain provisions
("drag-along rights") under which a holder of Shares of any class
can be required to sell all of his shares to a third party where an
offer has been made by such third party to acquire the entire
issued share capital of Mirfield and such offer has been accepted
by shareholders holding at least 75% of the voting rights in the
Company.
The Articles of Association of Mirfield contain provisions
("tag-along rights") which provide that no transfer of shares shall
be made which would result in the acquisition of a majority of
voting rights in Mirfield by the transferee unless such transferee
has offered to acquire the shares held by all other members of
Mirfield on the same terms.
Target Company Shareholders should note that, following
completion of the Acquisition, none of the Mirfield share capital
will be listed on an investment exchange, neither is there any
present intention to list the share capital of Mirfield in the
future. The ability of Target Company Shareholders who elect the
Share Alternative, to sell the Mirfield B Shares will therefore be
limited. Target Company Shareholders should consider whether
Mirfield B Shares are a suitable investment in light of their own
personal circumstances and are, therefore, strongly advised to seek
their own independent financial advice before deciding whether to
elect to participate in the Share Alternative. Any decisions to
elect for the Share Alternative should be based on a full
consideration of the Scheme Document (when issued).
Appendix 4
IRREVOCABLE UNDERTAKINGS
The following target Company Shareholders have given irrevocable
undertakings to vote in favour of the Proposal on the basis set out
below:
Name of Target Company Number of Target Percentage of existing
Shareholder Company Shares in issued share capital
respect of which of the Target Company
undertaking is given
--------------------------- ---------------------- -----------------------
Rupert Nicholas Hambro 1,525,959 6.6
--------------------------- ---------------------- -----------------------
Francis John McKay 131,579 0.6
--------------------------- ---------------------- -----------------------
Alister Theodore
Fennell (including
the TF SIPP) 3,750,279 16.2
--------------------------- ---------------------- -----------------------
Alasdair Kinloch
Hadden-Paton 866,626 3.7
--------------------------- ---------------------- -----------------------
Centric Investments
Limited 481,516 2.1
--------------------------- ---------------------- -----------------------
Francis Richard Northcott 2,969,987 12.8
--------------------------- ---------------------- -----------------------
Lodestone Limited 1,774,400 7.7
--------------------------- ---------------------- -----------------------
Total 11,500,346 49.7
--------------------------- ---------------------- -----------------------
These irrevocable undertakings include undertakings:
-- To vote, or procure the vote, in favour (or to submit, or
procure the submission of, Forms of proxy voting in favour) of
(a) the Scheme at the Court meeting (save for Mr Fennell and the
TF SIPP who may not vote on the Scheme at the Court Meeting);
and
(b) the resolutions at the general Meeting save that Mr Fennell
and Mr Hadden-Paton will not vote these shares in respect of any
resolution relating to his own arrangements required in accordance
with Rule 16 of the Takeover Code; and
-- If Mirfield exercises its right to structure the Acquisition
as an Offer, to accept, or procure the acceptance of the Offer.
These irrevocable undertakings will lapse if:
-- This Announcement has not been released within one business
day following the date of such undertaking; or
-- The Scheme document is not posted within 28 days of the date
of this Announcement or within such longer period as Mirfield and
the Target Company, with the consent of the Panel, determine;
or
-- In the event the Scheme lapses or otherwise ceases to be
capable of becoming effective or is withdrawn; or
-- In the event of an Offer being made, upon the Offer being withdrawn or lapsing.
Mr Fennell has further undertaken to accept the Share
Alternative in respect of 2,871,745 Shares.
Mr Hadden-Paton has further undertaken to accept the Share
Alternative in respect of 866,626 Shares.
Appendix 5
BASES AND SOURCES OF INFORMATION
1. Unless otherwise stated, financial information relating to
the Target Company has been extracted or derived (without any
adjustment) from the Target Company's announcement dated the same
day as this Announcement of its results for the year ended 31 March
2013.
2. The value of the Acquisition is calculated by reference to
the price of 12.5p per Target Company Share being a premium of
6.25p per Target Company Share over the closing price of 6.25p per
Target Company Share on 31 July 2013, being the latest practicable
date prior to this announcement and on the basis of the current
undiluted number of Target Company Shares in issue referred to in
paragraph 5 below.
3. The calculation of up to a maximum of 611,111 Mirfield B
Shares to be issued to Target Company Shareholders who accept the
Share Alternative is based upon 30% of the current undiluted number
of Target Company Shares in issue referred to in paragraph 5 below
multiplied 0.08796.
4. References to percentages of Target Company Shares (before
completion of the Acquisition) are based upon the current undiluted
number of Target Company Shares in issue referred to in paragraph 5
below.
5. As at the close of business on 31 July 2013, being the latest
practicable date prior to this announcement, the Target Company had
in issue 23,158,029 Target Company Shares (being its undiluted
share capital) and this does not include any shares issuable
pursuant to any options, warrants or other convertible securities
in the Target Company and assumes no further issue of Target
Company Shares prior to completion of the Acquisition.
Unless otherwise stated, all closing prices for Target Company
Shares are closing middle market quotations derived from the London
Stock Exchange Daily Official List.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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