RNS Number : 4272K
  Evolve Capital PLC
  18 December 2008
   

    18 December 2008
    Evolve Capital PLC

    Offer for Blue Oar PLC

    Response to Defence Document

    Evolve Capital PLC ("Evolve") has made an offer (the "Offer") for the whole of the issued and to be issued share capital of Blue Oar PLC
("Blue Oar") in response to which Blue Oar has today published a defence document containing certain reasons why Blue Oar believes its
shareholders should reject the Offer. 

    During these challenging times this Offer is intended to preserve, enhance and ultimately realise value in the enlarged group by
curtailing the current cash outflow at Blue Oar, by restructuring and refocusing the business and, in particular, capitalising on the
strength of the Rowan Dartington brand.

    Evolve believes that all Blue Oar shareholders need the clear and unequivocal answers to two  fundamental questions rather than
platitudes and verbiage.

    QUESTION - How much cash will there be left at 31 December 2008?

    QUESTION - How big will the loss for 2008 be?

    Blue Oar's cash fell by 29% from �23.1 million to �16.4 million in the six months to 30 June 2008. In its interim accounts for the six
months ended 30 June 2008, announced on 3 September 2008, Blue Oar states "The second half of the year is unlikely to show much improvement
over the first half unless current market conditions improve dramatically."  How much has cash fallen since 30 June 2008 and how much
further is it going to fall without a change in strategy?

    As we are within two weeks of the Blue Oar's year end answers to these questions should be readily available.

    Evolve recognises the disruption to the Blue Oar business that the Offer presents. The delay in providing information on Blue Oar's cash
position, which some shareholders may require to determine their position, only extends the period during which the uncertainty will exist.
Evolve's directors believe that it is only reasonable for Blue Oar shareholders to demand a more fulsome trading update to that provided
today and an estimate of the net cash position.

    The choice facing a Blue Oar shareholder is simple:

    Evolve presents a strategic direction for Blue Oar which will reduce, and hopefully stop, cash deterioration and will concentrate on
enhancing the value of, and subsequently realise by flotation and distribution to Evolve shareholders, Blue Oar's core strength, Rowan
Dartington. To support this strategy a Blue Oar shareholder should accept the Offer.

    If Blue Oar shareholders really want to invest in building a high-cost investment bank which has been haemoraging cash, they should
indeed reject the Offer.

    Evolve has requested, and Blue Oar has agreed, to put in place a system whereby employee shareholders in Blue Oar who hold their shares
through Dartington Portfolio Nominees Limited can accept the Offer anonymously, without any internal approvals, and without any concerns
that in so doing they may be breaching their employment contract. 

    In the light of certain actions by Blue Oar's board in response to the Offer, Evolve has requested and agreed with certain Blue Oar
shareholders (holding in excess of 10 per cent. of the company's shares) to prepare the documentation necessary to requisition a general
meeting to remove all current directors of Blue Oar so that in the event that the Offer is declared unconditional in all respects there will
be no delay in Evolve being able to implement the new strategic direction. Despite the proposed resolution seeking to remove all current
directors of Blue Oar, it is probable that Evolve (and its supporting Blue Oar shareholders) will only wish to remove (or seek the
resignation of) those directors seeking to frustrate the implementation of the new strategic direction and Evolve still wishes, if possible,
to work with existing management.

    Under the terms of the Offer, Blue Oar shareholders will receive:  

    For every 1,000 Blue Oar shares, 1,025 new Evolve shares.

    Following completion of the Offer the issue of new Evolve shares to accepting Blue Oar shareholders will result in the Blue Oar
shareholders owning up to 78.7% of the share capital of the enlarged share capital of Evolve.  

    Offer values based on share prices can change from day-to-day and, depending on the date selected, will give rise to varying bid premium
or discount figures. However, arguments by Blue Oar's directors that Evolve is trying to "get Blue Oar shares on the cheap" miss the point.
If the Offer is successful, accepting Blue Oar shareholders, alongside the existing Evolve shareholders, would continue to own Blue Oar with
its cash and other resources as well as Evolve's cash and investments.

    The directors of Evolve see no reason why, if the Offer succeeds, shares in the enlarged Evolve group should be any less liquid than
shares in Blue Oar currently are.

    Blue Oar's directors refer to Evolve as a company with only �2.6 million of cash, some investments and no turnover. What they don't say
in their defence document is that if the Offer succeeds, Evolve would become the holding company of the Blue Oar group, but with a different
strategy and with the cash and investments currently held by Evolve.  

    Evolve's small size in relation to Blue Oar means that a larger proportion of Evolve's enlarged share capital will, if the Offer is
successful, be held by current Blue Oar shareholders than would have been the case if a larger company had made a similar offer. 
Accordingly, rather than its relatively small size working to the disadvantage of accepting Blue Oar shareholders, as is implied in the
defence document, it in fact benefits them, as they will own a larger percentage of the ultimate holding company, Evolve, than may otherwise
have been the case.

    Evolve is indeed seeking to gain strategic control over Blue Oar's cash flow, but with the intention not of taking it away from Blue Oar
shareholders, but of preserving the cash for the benefit of the enlarged group, most of whose shareholders would be the present Blue Oar
shareholders.

    The first closing of the Offer is at 1pm on 30 December 2008.

    Copies of the Offer Document, Admission Document and circular to Evolve shareholders which contain further information about Evolve and
its strategy are available in pdf form at www.evolvecapital.co.uk.

    Enquiries:

    
 Evolve Capital PLC  Edward Vandyk   Tel: 020 7937 4445www.evolvecapital.co.uk
 Fairfax I.S. PLC        David                              Tel: 020 7598 5368
 Floyd, Adam Hart and Jeremy Porter
 Maitland        Neil Bennett and                           Tel: 020 7379 5151
 George Hudson 


    The Evolve directors accept responsibility for the information contained in this Announcement. To the best of the knowledge and belief
of the Evolve 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.

    This announcement does not constitute, or form part of, an offer or an invitation to purchase or subscribe for any securities.  

    Not for release, publication or distribution in whole or in part into ANY JURISDICTION WHERE TO DO SO WOULD CONSTITUTE A VIOLATION OF
THE RELEVANT LAWS OF SUCH JURISDICTION

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