LBE Longboat Energy Plc

 

TIDMMWB TIDMLBE 
 
RNS Number : 0978M 
Pyrrho Investment Limited 
18 May 2010 
 

NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION IN WHOLE OR IN PART, IN, INTO OR 
FROM ANY JURISDICTION WHERE TO DO THE SAME WOULD CONSTITUTE A VIOLATION OF THE 
RELEVANT LAWS OF SUCH JURISDICTION 
FOR IMMEDIATE RELEASE 
18 May 2010 
Liberty Plc ("Liberty") 
                       RESPONSE TO LIBERTY'S ANNOUNCEMENT 
 
Pyrrho Investments Limited ("Pyrrho") notes the announcements made by Liberty on 
14 May and 17 May in response to Pyrrho's announcement that it has made a 
proposal to Liberty's board that it wishes to make an offer for the entire 
issued and to be issued share capital of Liberty at a higher aggregate price 
than the possible offer by BlueGem Capital Partners LLP ("BlueGem") that was 
announced on 7 May. 
 
For the benefit of the shareholders of MWB Group Holdings plc ("MWB") and 
Liberty, Pyrrho wishes to respond to and clarify a number of assertions that 
were made in the announcements by Liberty: 
 
1.         Pyrrho's initial proposal to Liberty on 4 May was not "highly 
conditional" 
 
As stated in Pyrrho's announcement on 14 May, this initial proposal was subject 
to standard due diligence pre-conditions.  These were discussed in a meeting 
between Arbuthnot Securities Limited ("Arbuthnot"), Pyrrho's advisers, and 
Panmure Gordon ("Panmure"), MWB's advisers, in the morning of 5 May.  During 
this meeting, Arbuthnot represented that these due diligence pre-conditions were 
capable of being addressed in a very short timescale, primarily by arranging a 
meeting between the respective parties. 
 
2.         The risk to Liberty of BlueGem's possible proposed offer falling away 
was not material 
 
On 6 May, Pyrrho made an approach to Liberty with a revised proposal which was 
not subject to any due diligence pre-conditions.  Pyrrho subsequently discovered 
that this revised proposal was only 1p per Liberty share less than BlueGem's 
revised proposed offer of 186p. 
 
If Liberty had agreed to negotiate with Pyrrho, even if BlueGem's revised 
proposed offer had fallen away, the downside to Liberty shareholders was only 
approximately GBP230,000, a difference of 0.5% in a transaction of over 
GBP43million. Pyrrho's revised proposal at 185p was open for the Liberty board's 
acceptance until 5pm on 7 May. 
 
Pyrrho believes that it remains in Liberty shareholders' interests for the 
Liberty board to explore a possible offer from Pyrrho. 
 
3.         a) Pyrrho was never told that a higher offer existed 
 
On 3 May Pyrrho was informed that BlueGem had made an offer for Liberty (the 
"Original BlueGem Offer").  On 6 May Pyrrho made an unconditional offer at a 
higher price than the Original BlueGem Offer.  At no time did Panmure or 
Liberty's advisers Cavendish Corporate Finance ("Cavendish") inform Pyrrho that 
Liberty had received an offer higher than Pyrrho's 185p unconditional offer. 
Pyrrho naturally assumed that it remained the highest bidder, and therefore saw 
no reason to raise its offer.  Pyrrho was only aware of the higher offer when an 
email was sent to Arbuthnot 13 minutes prior to the publication of the 
announcement at 7am on 7 May that Liberty had received an offer of 186p from 
BlueGem. 
            b) 185p was not Pyrrho's highest offer 
 
In the early afternoon of 6 May, Panmure telephoned Arbuthnot to ask if 185p was 
Pyrrho's highest offer. Unaware that BlueGem had made or were intending to make 
a higher offer, Arbuthnot replied that "this (i.e.185p) is an offer that we are 
able to deliver on today", leaving the door open for further negotiation. 
 
At no time did Arbuthnot state that 185p was Pyrrho's highest offer. 
 
This brief statement by Arbuthnot should not have been construed or interpreted 
by Panmure (particularly without having sought clarification from Pyrrho or its 
advisers) as confirmation that "Pyrrho was not prepared to increase that offer 
on an unconditional basis above 185 pence" as was stated in Liberty's 
announcement on 14 May. 
 
Subsequent to the aforementioned telephone conversation between Panmure and 
Arbuthnot, between 4 pm and 8 pm on 6 May, Arbuthnot chased Panmure and 
Cavendish several times, via e-mails and telephone messages, in an earnest 
attempt to obtain an update on the status of Liberty board's decision-making 
process, and to try to ascertain if there was a higher offer. 
 
It must have been obvious to Cavendish, Liberty's advisers, that the numerous 
attempts that Arbuthnot made to discuss the proposed Pyrrho offer with them 
during the afternoon of 6 May indicated that they were in a position to provide 
further information to Liberty and its advisers, which could have benefited 
Liberty and MWB's shareholders. 
 
4.         The Liberty and MWB boards did not sufficiently consider the Pyrrho 
Offer 
Pyrrho is surprised that, since it first indicated its interest in making a 
possible offer for Liberty on 4 May, neither MWB nor Liberty made any attempt to 
contact Pyrrho to discuss this or to arrange a meeting. In addition, MWB's 
advisers and Liberty's advisers made no proactive attempt to enter into any 
discussions with Pyrrho's advisers. 
We understand that some time after receipt by Liberty of the higher 185p per 
share offer from Pyrrho on 6 May, BlueGem restructured its bid (i.e. materially 
enlarging the Liberty special dividend and shrinking BlueGem's cash offer 
component, compared to BlueGem's original bid), culminating in a revised BlueGem 
bid that is, in the aggregate, a mere 1p per share above Pyrrho's unconditional 
offer. 
Pyrrho was given no opportunity to respond to BlueGem's revised offer, a 
privilege afforded to BlueGem in response to Pyrrho's unconditional offer of 
185p. Pyrrho cannot understand, in light of the incremental difference between 
Pyrrho's unconditional offer of 185p and BlueGem's revised offer of 186p being 
so small, why the Liberty Board and its advisers did not invite competing 
potential acquirers to bid against each other in another competitive round in 
order to achieve a higher final offer price. 
Pyrrho believes that this was an inappropriate manner in which to consider a 
matter as important as a potential offer for Liberty. 
5.         Liberty's advisers did indicate to Pyrrho's advisers that they would 
update them on any developments in this matter 
This assertion was made both verbally and in an email by Cavendish at 3.20pm on 
6 May to Arbuthnot. 
6.         Pyrrho showed interest in a bid for Liberty once it became aware of 
potential terms 
Pyrrho has watched the efforts of the Liberty management team and MWB to elicit 
offers for Liberty since its strategic review was announced in July 2009. Pyrrho 
would have put forward this proposal earlier had it been aware of the level of 
offer that Liberty's board and MWB were willing to recommend and accept. Pyrrho 
made its initial approach to Liberty on 4 May one day after becoming aware of 
this information. 
 
Improved Proposal 
 
Further to its announcement on 14 May, Pyrrho reiterates that it has made a 
revised proposal to Liberty's board that it wishes to make an offer for the 
entire issued and to be issued share capital of Liberty at a higher aggregate 
price than BlueGem's aggregate 186p per share offer. 
 
 
For further information, please contact: 
Arbuthnot Securities Limited 
Nick Tulloch 
Tel: +44 (0) 207 012 2000 
Ben Wells 
Ed Gay 
 
Hogarth PR 
Reg Hoare 
Tel: +44 (0) 7884 494112 
Katie Hunt 
    +44 (0) 207 357 9477 
Ian Payne 
 
Copies of this announcement are available on the London Stock Exchange website 
www.londonstockexchange.com 
Disclosure requirements of the Takeover Code (the "Code") 
Under Rule 8.3(a) of the Code, any person who is interested in 1% 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 10th business day following the 
commencement of the offer period and, if appropriate, by no later than 3.30 pm 
(London time) on the 10th business day following the announcement in which any 
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 Code, any person who is, or becomes, interested in 1% 
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. 
 
 
This information is provided by RNS 
            The company news service from the London Stock Exchange 
   END 
 
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