RNS No 0219n
BANDT PLC
7 July 1999
Part 1
Not for release, distribution or publication in or into the
United States of America, Canada, Japan or Australia.
7 July, 1999
Recommended Offer
by
Cazenove & Co.
on behalf of
Tilbury Douglas Plc
for
Bandt plc
- The Boards of Tilbury Douglas and Bandt announce the terms
of an offer to be made by Cazenove on behalf of Tilbury
Douglas for the entire issued ordinary share capital of
Bandt.
- The Offer has been recommended by the board of Bandt who
have been advised by Singer & Friedlander.
- The Offer will be 7 New Tilbury Douglas Shares and #32.24
in cash for every 100 Bandt Shares and there will be a Mix
and Match Election available to Bandt Shareholders who
accept the Offer.
- The Offer values the entire issued ordinary share capital
of Bandt at approximately #75.7 million and each Bandt
Share at 53.8 pence.
- In addition, Bandt Shareholders on the register on 16 July
1999 will be entitled to receive and retain the proposed
final net dividend of 1.2 pence per Bandt Share announced
on 7 June 1999 or to waive their dividend entitlement and
receive an additional payment of 1.2 pence per Bandt Share.
- The Offer, including the proposed final net dividend,
represents a premium of approximately 15.8 per cent. over
the closing middle market quotation of 47.5 pence per Bandt
Share (as derived from the Official List, cum dividend) on
21 June 1999, being the last dealing day prior to the
announcement that Bandt had received an approach which may
lead to an offer, and a premium of 14.6 per cent. over
yesterday's closing middle market price of 48 pence per
Bandt Share (as derived from the Official List, cum
dividend).
- Tilbury Douglas has received binding irrevocable
undertakings to accept the Offer from the directors of
Bandt and other Bandt Shareholders amounting in aggregate
to 78,780,080 Bandt Shares, representing approximately 56.0
per cent. of Bandt's existing issued ordinary share
capital. These undertakings will cease to be binding if an
offer from a third party is received which values each
Bandt Share at 60 pence or more.
The above summary is to be read in conjunction with the full
text of this announcement.
Commenting on the Offer, Michael Bottjer, Chairman of
Tilbury Douglas, said:
"Following the successful integration of the How Group
acquired last year, Bandt is another attractive acquisition
for Tilbury Douglas, which is expected to enhance further the
quality of our earnings base. It will substantially increase
our presence in support services through the addition of
complementary skills in Industrial Services and Access
Equipment, activities which present good prospects for growth.
In addition Bandt will increase our range of services and
ability to provide a more comprehensive and seamless service
to our customers. This acquisition should enhance further
Tilbury Douglas' position in the market place and make a
positive contribution to the future earnings growth of the
business".
Bill Andrews, Chairman of Bandt, said:
"Under the existing management team, Bandt has, in recent
years, been transformed both structurally and in trading and
financial terms. It is now at a stage of its development
where it will benefit from being part of a larger
international group; the Offer from Tilbury Douglas will
allow shareholders to realise part of their investment and
to participate in the future of the enlarged group".
A presentation to analysts will be held at Regus Old Broad
Street Conference Centre, 120 Old Broad Street, London EC2N
1AR at 10.00 a.m. today.
Enquiries
Tilbury Douglas Michael Bottjer 0118 932 0123
Stuart Lee
Cazenove & Co. Nick Wiles 0171 588 2828
Bandt Richard Wilson 01256 477760
Dick Rutter
Singer & Friedlander Greg Aldridge 0171 523 5000
Cazenove, who are regulated in the United Kingdom by The
Securities and Futures Authority Limited, are acting for
Tilbury Douglas and for no one else in connection with the
Offer and will not be responsible to anyone other than Tilbury
Douglas for providing the protections afforded to customers of
Cazenove nor for providing advice in relation to the Offer or
any matter referred to herein or in the Offer Document.
Singer & Friedlander, which is regulated in the United Kingdom
by The Securities and Futures Authority Limited, is acting for
Bandt and for no one else in connection with the Offer and
will not be responsible to anyone other than Bandt for
providing the protections afforded to customers of Singer &
Friedlander nor for providing advice in relation to the Offer
or any matter referred to herein or in the Offer Document.
Not for release, distribution or publication in or into the
United States of America, Canada, Japan or Australia.
7 July, 1999
Recommended Offer
by
Cazenove & Co.
on behalf of
Tilbury Douglas Plc
for
Bandt plc
Introduction
The Boards of Tilbury Douglas and Bandt announce that they
have reached agreement on the terms of a recommended offer, to
be made by Cazenove on behalf of Tilbury Douglas, for the
entire issued and to be issued ordinary share capital of
Bandt. The Offer values the current issued ordinary share
capital of Bandt at approximately #75.7 million and each Bandt
Share at 53.8 pence. In addition, there will be a Mix and
Match Election, as described below.
The Board of Bandt, which has been so advised by Singer &
Friedlander, its financial adviser, considers the terms of the
Offer to be fair and reasonable and unanimously recommends
Bandt Shareholders to accept it. In providing advice to the
Board of Bandt, Singer & Friedlander has taken account of the
commercial assessments of the directors of Bandt.
The directors of Bandt have entered into agreements with
Tilbury Douglas pursuant to which they have irrevocably
undertaken to accept the Offer in respect of their personal
holdings amounting in aggregate to 105,300 Bandt Shares,
representing approximately 0.07 per cent. of the current
issued ordinary share capital of Bandt. In addition, certain
institutional shareholders have undertaken to accept the Offer
in respect of their aggregate holdings of 78,674,780 Bandt
Shares, representing approximately 55.9 per cent. of the
current issued ordinary share capital of Bandt. Together with
the irrevocable undertakings referred to above, this
represents approximately 56.0 per cent. of the current issued
ordinary share capital of Bandt. The terms of all the above
undertakings require acceptance of the Offer even in the event
of a competing offer for Bandt from a third party, unless the
competing offer is announced within periods varying between
five and ten days after the posting of the formal offer
document containing the Offer and values each Bandt Share at
60 pence or more, or in certain other circumstances.
The Offer is final and will not be increased. However,
Tilbury Douglas reserves the right to increase and / or
otherwise revise (on terms no less favourable than the Offer)
the Offer in the event of a competitive situation arising or
otherwise with the consent of the Panel.
The Offer
The Offer, which will be subject, inter alia, to the
conditions and further terms set out below and in Appendix I
to this announcement and to be set out in full in the Offer
Document, will be made on the following basis:
for every 100 Bandt Shares 7 New Tilbury Douglas Shares and
#32.24 in cash
and so in proportion for any other number of Bandt Shares
held.
Bandt Shareholders who are on the register on 16 July 1999
will be entitled to receive and retain the final net dividend
of 1.2 pence per Bandt Share proposed in the preliminary
results announcement issued by Bandt on 7 June 1999.
Bandt Shareholders who accept the Offer and are entitled to
receive the final dividend will be able to elect to waive
their dividend entitlement and to receive from Tilbury Douglas
an additional payment of 1.2 pence per Bandt Share from
Tilbury Douglas in cash. This election will remain open until
3.00 pm on the first closing date of the Offer. In order to
enable this election to be made available it is proposed that
the payment date for the Bandt final dividend be deferred from
17 August 1999 to 10 September 1999.
The Offer including the proposed Bandt final net dividend
represents a premium of approximately 15.8 per cent over the
closing middle market quotation of 47.5 pence per Bandt Share
(as derived from the Official List, cum dividend) on 21 June
1999, the last day of dealings prior to the announcement by
Bandt of an approach which may lead to an offer. For
illustrative purposes, the financial effects of acceptance of
the Offer are set out in Appendix II.
Full acceptance of the Offer (assuming full exercise of
options under the Bandt Share Option Schemes) would involve
the issue of up to 10,319,968 New Tilbury Douglas Shares
(representing approximately 10.2 per cent. of the enlarged
issued share capital of Tilbury Douglas) and the payment of
approximately #47.5 million in cash consideration.
The Mix and Match Election
Bandt Shareholders who validly accept the Offer may elect,
subject to availability, to vary the proportions in which they
receive New Tilbury Douglas Shares and cash in respect of
their holdings of Bandt Shares. However, the maximum
aggregate number of New Tilbury Douglas Shares to be issued
under the Offer, and the maximum aggregate amount of cash to
be paid out under the Offer, will not be varied as a result of
the Mix and Match Election. Tilbury Douglas' ability to
satisfy Mix and Match Elections made by Bandt Shareholders
will therefore depend on other Bandt Shareholders making
offsetting elections. To the extent that elections cannot be
satisfied in full, they will be scaled down on a pro rata
basis. To the extent that elections can be satisfied, Bandt
Shareholders will receive New Tilbury Douglas Shares instead
of cash, and vice versa, at the rate of 308 pence per New
Tilbury Douglas Share.
As a result of the operation of the mix and match facility as
described above, Bandt Shareholders who make a Mix and Match
Election will not necessarily know the exact number of New
Tilbury Douglas Shares or the amount of cash which they will
receive until settlement of the consideration under the Offer,
although an announcement will be made when the Offer becomes
or is declared wholly unconditional of the approximate extent
to which the Mix and Match Election will be satisfied.
The Mix and Match Election will remain open until 3.00pm on
the first closing date of the Offer. If the Offer is not then
unconditional as to acceptances, Tilbury Douglas may extend
the Mix and Match Election to a later date. If the Mix and
Match Election has been closed, Tilbury Douglas reserves the
right to re-introduce a Mix and Match Election, subject to the
rules of the City Code.
The Mix and Match Election will not be available in respect of
the additional payment of 1.2 pence per Bandt Share referred
to above.
Further details of the Offer
The Offer will be conditional, inter alia, on the approval of
the Acquisition by Tilbury Douglas shareholders. An
Extraordinary General Meeting of Tilbury Douglas will be
convened for the purpose of seeking the necessary approval of
Tilbury Douglas shareholders.
The Bandt Shares to which the Offer relates will be acquired
free from all liens, charges, equitable interests and
encumbrances and together with all rights attaching thereto
including the right to receive all dividends (save for the
proposed net final dividend of 1.2 pence for the financial
year ended 4 April 1999).
The cash component of the consideration will be funded
predominantly through bank financing.
The New Tilbury Douglas Shares will be issued credited as
fully paid and will rank pari passu in all respects with
existing Tilbury Douglas Shares and will be entitled to all
dividends and other distributions declared, made or paid after
the date of the Offer.
Background to and Reasons for the Offer
Over recent years Bandt has transformed its business to focus
on two core activities:
- through FK Multiservices, the provision of industrial
services to businesses in the petrochemical, pharmaceutical,
food and manufacturing sectors primarily in access,
industrial cleaning and painting, thermal insulation and
cladding with much of its revenue derived from term
maintenance work.
- through Kwikform UK the supply of access equipment services
for repair, maintenance and new works through traditional
and system scaffolding equipment and also the provision of
formwork and falsework solutions.
The Directors believe that there are attractive growth
opportunities in these service businesses, particularly
Industrial Services and, therefore, are seeking to expand the
Group's activities in these areas. The Directors believe that
the acquisition will bring significant operational and
strategic as well as financial benefits to the Group.
Operational and Strategic Benefits
The acquisition of How Group plc in June last year accelerated
the Tilbury Douglas Group's development of its services and
specialist operations, a core part of the Group's strategy.
This has provided the platform for the expansion of its
facilities services and engineering services activities and,
through partnering between inter-related businesses, the
ability to provide a comprehensive and seamless service to
customers.
Against this background, and following the integration of
How's businesses, the acquisition of Bandt represents a
further significant step in the continued refocusing of
Tilbury Douglas in the provision of support services and
specialist construction services. Bandt will bring
complementary capabilities in Industrial Services and Access
Equipment Services, broadening further Tilbury Douglas' range
of businesses in support services.
Industrial Services
As an increasing number of companies are outsourcing their
service requirements and seeking multi-skill capabilities,
Bandt's industrial services business, FK Multiservices, is
already providing these services to a number of well-known
companies. In the year ended 4 April 1999 approximately 50
per cent. of group operating profit (before contributions from
non-core investment properties and group costs) was derived
from those activities that now comprise FK Multiservices. The
Directors believe that:
- Industrial Services will offer attractive growth
opportunities for the Group. While initially the accent
will be upon expansion in the UK, the Directors believe that
the Group's long established presence in the Middle East and
its Equipment Services infrastructure covering some 24
countries should provide good opportunities for expansion
overseas;
- Industrial Services will complement the Group's existing
range of support services and the Directors believe that
this will enable Tilbury Douglas to provide an attractive
range of integrated services to customers in both the
private and public sectors.
Access Equipment Services
Tilbury Douglas' existing equipment services business mainly
provides formwork and falsework on a design, hire and sale
basis. The acquisition will add a substantial complementary
business in the form of access equipment services which will
therefore significantly enhance the range of Tilbury Douglas'
equipment services in the UK and provide the potential for
Tilbury Douglas to expand its access equipment services both
in the UK and to selected countries overseas.
Financial Benefits
The Directors believe that the acquisition will:
- provide the opportunity for reduction of costs through
elimination of duplicated central costs, improved equipment
procurement and rationalisation of equipment services in the
UK;
- immediately enhance underlying earnings per share before any
amortisation of goodwill. (This statement should not be
interpreted to mean that the enlarged group's future
earnings per share would necessarily be greater than the
historic earnings per share of Tilbury Douglas);
It is proposed that the Offer will be funded predominantly
through bank financing, which the Directors believe will
enhance Tilbury Douglas' capital structure.
Information relating to the Tilbury Douglas Group and current
trading
Tilbury Douglas is an international group providing support
services and specialist construction services to the private
and public sectors. At 31 December 1998 the Group employed
approximately 6,000 people. In the year ended 31 December
1998, Group total operating profit before exceptional items
and goodwill amortisation was #29.5 million on a turnover of
#641.1 million, with profit on ordinary activities before tax
of #27.1 million. Shareholders' funds at 31 December 1998
were #94 million.
Tilbury Douglas' main areas of activity are described below:
Equipment Services
Tilbury Douglas' Equipment Services specialises in the design,
hire and sale of formwork and concrete support products to the
construction industry world-wide. It principally operates in
the UK, Ireland, Continental Europe, the Middle East, the Far
East, Australasia and South America.
Engineering Services
Engineering Services provides support services, maintenance
and capital works in a wide range of markets, including petro-
chemical, pharmaceutical, food, rail, power, communications,
manufacturing, local authority and Government departments. It
operates predominantly in the UK.
Facilities Services
Operating in the substantial outsourcing market, Facilities
Services provides total capability in managing and maintaining
many of the support service needs of customers. These include
mechanical and electrical services, cleaning, catering,
security and transportation. Its client base includes many
well-known companies as well as government departments, the
health sector and local authorities.
Construction Services
Construction Services focuses upon higher quality work
involving close co-operation with customers to add value to
their business under arrangements such as partnering,
framework agreements, design-build and property services. The
work covers a wide spectrum from building to civil engineering
principally in the UK but Tilbury Douglas also has extensive
overseas interests, mainly in the Middle East.
Housebuilding
Housebuilding operates mainly in central Scotland and is
engaged in both speculative housebuilding and the partnership
sectors, the latter being under the Government's New
Partnership Housing Initiative.
Current Trading and Prospects
At the 1998 Annual General Meeting held on 10 June 1999, the
Chairman of Tilbury Douglas commented that the Group had
entered 1999 in a strong position.
Performance in the first four months showed a good start to
the year with the overall operating performance well ahead of
the position one year previously, keeping the Group broadly in
line with expectations.
Total work in hand improved substantially both in terms of
quality and quantum over the past year and at the end of April
amounted to over #500 million, of which some #200 million
relates to next year and beyond.
In April the Group announced the award of a support services
contract for BP Amoco's chemical manufacturing site near Hull
with a value of some #40 million over 5 years.
Over 60 per cent. of Group operating profits now come from
what the Group would define as support services, essentially
from core operations in Equipment Services, Facilities
Services and Engineering Services.
The balance is mainly derived from Construction Services and
Housebuilding, where in construction some 75 per cent. of the
Group's work is generated by the ability to add value for
customers through arrangements such as partnering, framework
agreements, design and build and property services.
The overall outlook for the Group continues to be encouraging.
Information relating to the Bandt Group
The Bandt Group provides industrial services and access
services primarily to the manufacturing and construction
industries in the United Kingdom through its two principal
operating businesses, FK Multiservices and Kwikform UK,
respectively.
In May this year, Bandt began the process of amalgamating its
industrial services activities into FK Multiservices,
comprising the Bandt Group's pre-existing industrial services
businesses: Kwikform's industrial services division, Fincham
Industrial Services and three of the businesses which it
acquired in January and February 1999 (Global Protect Limited,
THK Insulation Limited and certain activities of Brian Willey
Limited). FK Multiservices supplies a range of services to
industrial businesses, which include access, industrial
cleaning and painting, thermal insulation and cladding.
The activities of Kwikform UK comprise both the provision of
access services to the construction markets through
traditional and system scaffolding equipment, and also the
supply of formwork/falsework solutions, predominantly for the
civil engineering and building sectors, as well as a range of
light access products for hire and sale.
Bandt's subsidiary, Bandt Properties Limited, holds an
investment property portfolio, which was stated in its
accounts at #7.4 million as at 4 April 1999. This business is
a non-core activity and Bandt Properties Limited is in the
process of liquidating its property portfolio as and when
opportunities to dispose of properties arise.
In the year ended 4 April 1999, total turnover of the Bandt
Group was approximately #78.4 million and profit on ordinary
activities before taxation amounted to approximately
#7.7 million. As at 4 April 1999, the Bandt Group had
shareholders' funds of #37.9 million.
Employees
Tilbury Douglas has confirmed that the existing rights,
including pension rights, of all Bandt Group employees will be
fully safeguarded.
Bandt Share Options
The Offer will extend to any Bandt Shares issued or
unconditionally allotted while the Offer remains open for
acceptance (or by such earlier date as Tilbury Douglas may,
subject to the City Code, determine) including any such shares
allotted or issued pursuant to the exercise of Bandt Options.
If the Offer becomes or is declared unconditional in all
respects, Tilbury Douglas intends to make appropriate
proposals to holders of Bandt Options to the extent that such
options have not been exercised.
General
Neither Tilbury Douglas, nor any of its directors, nor, so far
as Tilbury Douglas is aware, any person deemed to be acting in
concert with it, owns or controls any Bandt Shares or has any
option to acquire any Bandt Shares, or has entered into any
derivative referenced to securities of Bandt which remains
outstanding.
Statements herein as to the value of the Offer are based on
the middle market quotation, as derived from the Official
List, for a Tilbury Douglas Share at the close of business on
6 July 1999, (being the last dealing day before the
announcement of the Offer).
Appendix III contains the definitions used in this
announcement.
It is intended that the Offer Document (including a letter of
recommendation from the Chairman of Bandt), Forms of
Acceptance and Listing Particulars will be dispatched shortly
to Bandt Shareholders. Listing Particulars and a circular
explaining the Offer and convening an Extraordinary General
Meeting to seek approval for the Acquisition will also be
despatched to Tilbury Douglas shareholders shortly.
Cazenove, who are regulated in the United Kingdom by the
Securities and Futures Authority Limited, are acting for
Tilbury Douglas and for no one else in connection with the
Offer and will not be responsible to anyone other than Tilbury
Douglas for providing the protections afforded to customers of
Cazenove nor for providing advice in relation to the Offer or
any matter referred to herein or in the Offer Document.
Singer & Friedlander, which is regulated in the United Kingdom
by The Securities and Futures Authority Limited, is acting for
Bandt and for no one else in connection with the Offer and
will not be responsible to anyone other than Bandt for
providing the protections afforded to customers of Singer &
Friedlander nor for providing advice in relation to the Offer
or any matter referred to herein or in the Offer Document.
This document does not constitute, or form part of, any offer
for, or any solicitation of any offer for, securities. Any
acceptance or other response to the Offer should be made only
on the basis of information referred to in the Offer Document
which Tilbury Douglas intends to dispatch shortly to Bandt
Shareholders and, for information only, to holders of options
under the Bandt share option schemes.
This announcement has been approved, solely for the purposes
of Section 57 of the Financial Services Act 1986, by Cazenove,
who are regulated in the United Kingdom by the Securities and
Futures Authority Limited.
MORE TO FOLLOW
OFFUBUWCMBGBUUM
Burtonwood (LSE:BND)
Historical Stock Chart
From Nov 2024 to Dec 2024
Burtonwood (LSE:BND)
Historical Stock Chart
From Dec 2023 to Dec 2024
