RNS Number:6074J
ING Bank N.V. London Branch
03 April 2003
NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION IN WHOLE OR IN PART IN, INTO OR
FROM THE UNITED STATES, CANADA, AUSTRALIA OR JAPAN.
FOR IMMEDIATE RELEASE
3 April 2003
Recommended Cash Offer
by
ING Barings
on behalf of
GondolaExpress PLC
to acquire the entire issued and to be issued ordinary share capital of
PizzaExpress PLC
SUMMARY
* The Boards of GondolaExpress and PizzaExpress are pleased to announce the
terms of a recommended cash offer of 387 pence per PizzaExpress Share, to be
made by ING Barings on behalf of GondolaExpress, for the entire issued and
to be issued ordinary share capital of PizzaExpress. The Offer represents a
premium of 20 pence per PizzaExpress Share to the Venice Bidder Offer Price.
A Loan Note Alternative will also be provided
* The Offer values the Existing Issued Share Capital of PizzaExpress at
approximately #277.8 million. The Offer Price of 387 pence per PizzaExpress
Share represents premia of approximately:
- 2.0 per cent. on the Closing Price of 379.5 pence on 2 April 2003, the last Business Day prior to the
date of this announcement;
- 5.4 per cent. on 367 pence, being the Venice Bidder Offer Price; and
- 47.1 per cent. on the Closing Price of 263 pence (adjusted to exclude the interim dividend of 3 pence
(net) per PizzaExpress Share) on 13 December 2002, the last Business Day prior to the announcement by
PizzaExpress that it had received a number of approaches which may or may not lead to an offer being
made for the Company
* The Offer has been recommended by both the Independent Directors and the
Executive Directors of PizzaExpress and the Executive Directors have
irrevocably undertaken to accept the Offer in respect of their own
beneficial holdings, which amount to, in aggregate, 500,768 PizzaExpress
Shares, representing approximately 0.7 per cent. of the Existing Issued
Share Capital of PizzaExpress
* As at the date of this announcement, GondolaExpress and parties acting in
concert with it have received either an irrevocable undertaking or a letter
of intent to accept the Offer in respect of, in aggregate, 10,253,327
PizzaExpress Shares, representing approximately 14.3 per cent. of the
Existing Issued Share Capital of PizzaExpress
* The Offer is being funded by the cash resources of GondolaExpress and debt
facilities provided by Bank of Scotland
* GondolaExpress is a newly-incorporated company which has been specifically
formed for the purpose of making the Offer. GondolaExpress is ultimately
owned by a limited partnership in which Capricorn and a fund managed by TDR
Capital are investors
* TDR Capital is a private equity partnership between Manjit Dale, Stephen
Robertson and Tudor Capital (U.K.) Ltd (a subsidiary of Tudor Group Holdings
LLC), which specialises in European mid-market buyouts
* Capricorn is a European-managed global investment group, which invests in
the restaurant, food and beverage sector, and in the insurance and niche
financial services sectors. It is the largest investor in Nando's
International, which owns or is the franchisor of some 400 restaurants
world-wide, including 63 in the UK, and is committed to expanding its
restaurant interests in the UK and internationally over the long term
Nigel Colne, Chairman of PizzaExpress, commented:
"Following the announcement on 16 December 2002 that PizzaExpress had received a
number of approaches that may or may not lead to an offer for the Company and
the subsequent offer made by Venice Bidder, I am now delighted to announce that
the terms of a higher cash offer for PizzaExpress have been agreed with
GondolaExpress. The Board of PizzaExpress believes that the Offer is fair and
reasonable and recommend it to Shareholders."
Manjit Dale, co-founder of TDR Capital, commented:
"This is a fair price for a high quality business, and we are delighted that a
number of PizzaExpress's institutional shareholders have recognised this and
have given either an irrevocable undertaking or a letter of intent to accept the
offer. PizzaExpress is an excellent first investment for TDR Capital and this
Offer demonstrates our appetite for mid-market European buyouts where we believe
we can add real value."
Robbie Enthoven, of Capricorn, commented:
"We believe PizzaExpress is quite simply the premier pizza brand in the UK and
we feel we can work closely with the Company in the private arena to bring a
fresh approach to a number of the difficult issues it is facing at this stage in
its development."
Enquiries:
TDR Capital Tel: 020 7399 4200
Manjit Dale
Stephen Robertson
Capricorn Tel: 020 7326 8440
Robbie Enthoven
Charles Luyckx
ING Barings Tel: 020 7767 1000
(Financial adviser and broker to GondolaExpress)
Tom Quigley
Simon Newton
Adam Fraser-Harris
Gavin Anderson & Co Tel: 020 7554 1400
(PR adviser to GondolaExpress)
Neil Bennett
Ken Cronin
PizzaExpress Today tel: 020 7638 9571
Nigel Colne Thereafter tel: 01895 618 618
David Page
Credit Suisse First Boston Tel: 020 7888 8888
(Financial adviser and broker to PizzaExpress)
Stuart Upcraft
Alastair Cochran
Richard Probert
Citigate Dewe Rogerson Tel: 020 7638 9571
(PR adviser to PizzaExpress)
Sue Pemberton
This summary should be read in conjunction with the full text of the following
announcement.
ING Barings, which is regulated in the United Kingdom by The Financial Services
Authority, is acting exclusively for GondolaExpress and no one else in
connection with the Offer and will not be responsible to anyone other than
GondolaExpress for providing the protections afforded to its customers or for
providing advice in relation to the Offer or in relation to the contents of this
announcement or any transaction or arrangement referred to herein.
Credit Suisse First Boston is acting exclusively for PizzaExpress and no one
else in connection with the Offer and will not be responsible to anyone other
than PizzaExpress for providing the protections afforded to its customers or for
providing advice in relation to the Offer.
Neither the Offer nor the Loan Note Alternative will be made, directly or
indirectly, in or into the United States or by use of the mails of, or by any
means or instrumentality (including, without limitation, facsimile or other
electronic transmission, telex or telephone) of inter-state or foreign commerce
of, or any facility of, a national, state or other securities exchange of, the
United States, nor will it be made directly or indirectly in or into Canada,
Australia or Japan and the Offer cannot be accepted by any such use, means,
instrumentality or facility or from within the United States, Canada, Australia
or Japan or any other such jurisdiction if to do so would constitute a violation
of the relevant laws of such jurisdiction. Accordingly, copies of this
announcement, the Offer Document and the Form of Acceptance are not being, will
not be and must not be mailed or otherwise forwarded, distributed or sent in,
into or from the United States, Canada, Australia or Japan or any other such
jurisdiction if to do so would constitute a violation of the relevant laws of
such jurisdiction and persons receiving this press announcement, the Offer
Document and Form of Acceptance (including without limitation custodians,
nominees and trustees) must not mail, forward, distribute or send them in, into
or from the United States, Canada, Australia or Japan or any other such
jurisdiction if to do so would constitute a violation of the relevant laws of
such jurisdiction.
The Loan Notes which may be issued pursuant to the Offer have not been, nor will
they be, registered under the Securities Act or under the securities laws of any
state of the United States; the relevant clearances have not been, nor will they
be, obtained from the securities commission of any province or territory of
Canada; no prospectus has been lodged with, or registered by, the Australian
Securities and Investments Commission or the Japanese Ministry of Finance; and
the Loan Notes have not been, nor will they be, registered under, or offered in
compliance with, applicable securities laws of any state, province, territory or
jurisdiction of Canada, Australia or Japan or any other such jurisdiction if to
do so would constitute a violation of the relevant laws of such jurisdiction.
Accordingly, the Loan Notes may not (unless an exemption under relevant
securities laws is applicable) be offered, sold, resold, or delivered, directly
or indirectly, in, into or from the United States, Canada, Australia or Japan or
any other jurisdiction if to do so would constitute a violation of the relevant
laws of, or require registration thereof in, such jurisdiction or to, or for the
account or benefit of, any United States, Canadian, Australian or Japanese
person.
This announcement does not constitute an offer to sell or invitation to purchase
or subscribe for any securities.
The availability of the Offer and/or the Loan Note Alternative to PizzaExpress
Shareholders who are not resident in the United Kingdom may be affected by the
laws of their relevant jurisdictions. PizzaExpress Shareholders who are not so
resident should inform themselves about and observe such applicable
requirements.
The full terms and conditions of the Offer (including details of how the Offer
may be accepted) will be set out in the Offer Document and the Form of
Acceptance accompanying the Offer Document. In deciding whether or not to accept
the Offer in respect of their PizzaExpress Shares, PizzaExpress Shareholders
should rely only on the terms and conditions of the Offer and the information
contained, and procedures described, in the Offer Document and the Form of
Acceptance.
PizzaExpress Shareholders are strongly advised to read the Offer Document
because it will contain important information.
NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION IN WHOLE OR IN PART IN, INTO OR
FROM THE UNITED STATES, CANADA, AUSTRALIA OR JAPAN.
FOR IMMEDIATE RELEASE
3 April 2003
Recommended Cash Offer
by
ING Barings
on behalf of
GondolaExpress PLC
to acquire the entire issued and to be issued ordinary share capital of
PizzaExpress PLC
1. Introduction
The Boards of GondolaExpress and PizzaExpress announce the terms of a
recommended cash offer of 387 pence per PizzaExpress Share, to be made by
ING Barings on behalf of GondolaExpress, for the entire issued and to be
issued ordinary share capital of PizzaExpress. The Offer represents a
premium of 20 pence per PizzaExpress Share to the Venice Bidder Offer Price.
GondolaExpress is a new company formed by TDR Capital and Capricorn in order
to implement the Offer.
On 16 December 2002, PizzaExpress announced that it had received approaches
which may or may not lead to an offer being made for the Company. One of
these approaches involved the executive management team and, consequently, a
committee of the Board of PizzaExpress comprising the Independent Directors
was formed to consider all offers. As a result, the Venice Bidder Offer and
other potential offer proposals were considered by the Independent Directors
of PizzaExpress. Subsequent to the announcement of the Venice Bidder Offer,
the Executive Directors ceased to pursue their own potential offer and so
the full Board of PizzaExpress has now taken responsibility for considering
the GondolaExpress Offer.
ING Barings is acting as exclusive financial adviser to GondolaExpress in
relation to the Offer.
2. Recommendation
The Directors of PizzaExpress, who have been so advised by Credit Suisse
First Boston, consider the terms of the Offer to be fair and reasonable. In
providing advice to the Directors of PizzaExpress, Credit Suisse First
Boston has taken into account the PizzaExpress Directors' commercial
assessments. Accordingly, the Directors of PizzaExpress will unanimously
recommend that PizzaExpress Shareholders accept the Offer, as the Executive
Directors have irrevocably undertaken so to do in respect of their own
beneficial holdings which amount to, in aggregate, 500,768 PizzaExpress
Shares, representing approximately 0.7 per cent. of the Existing Issued
Share Capital of PizzaExpress.
3. The Offer
On behalf of GondolaExpress, ING Barings will offer to acquire, on the terms
and subject to the conditions and further terms set out or referred to in
this announcement and in Appendix I to this announcement and the further
terms and conditions to be set out in the Offer Document and the
accompanying Form of Acceptance, the entire issued and to be issued ordinary
share capital of PizzaExpress not already owned by GondolaExpress, on the
following basis:
for each PizzaExpress Share 387 pence in cash
The Offer Price represents a premium of 20 pence per PizzaExpress Share to
the Venice Bidder Offer Price and values the Existing Issued Share Capital
of PizzaExpress at approximately #277.8 million. A Loan Note Alternative
will also be provided.
The Offer Price of 387 pence per PizzaExpress Share represents premia of
approximately:
- 2.0 per cent. on the Closing Price of 379.5 pence on 2 April 2003, the last Business Day prior to the date
of this announcement;
- 5.4 per cent. on 367 pence, being the Venice Bidder Offer Price; and
- 47.1 per cent. on the Closing Price of 263 pence (adjusted to exclude the interim dividend of 3 pence (net)
per PizzaExpress Share) on 13 December 2002, the last Business Day prior to the announcement by PizzaExpress
that it had received a number of approaches which may or may not lead to an offer being made for the Company
The PizzaExpress Shares will be acquired pursuant to the Offer by, or on
behalf of, GondolaExpress fully paid with full title guarantee, free from
all liens, equities, mortgages, charges, encumbrances, rights of pre-emption
and other third party rights and interests of any nature whatsoever and
together with all rights now or hereafter attaching to them, including all
voting rights and the right to receive and retain all dividends and other
distributions announced, declared, made or paid on or after the date of this
announcement.
4. The Loan Note Alternative
PizzaExpress Shareholders (other than certain Overseas Shareholders) who
validly accept the Offer may elect to receive Loan Notes to be issued by
GondolaExpress as an alternative to receiving any or all of the cash
consideration which they would otherwise receive under the Offer on the
following basis:
for every #1 of cash consideration under the Offer #1 nominal of Loan Notes
The Loan Notes will be unsecured obligations of GondolaExpress and will be
issued, credited as fully paid, in amounts and integral multiples of #1 in
nominal value. All fractional entitlements will be disregarded and not paid.
The payment of principal in respect of the Loan Notes will be guaranteed by
Bank of Scotland.
The Loan Notes will bear interest (from the date of issue of the relevant
Loan Notes) payable to the relevant holder of Loan Notes (subject to any
requirement to deduct tax thereon) semi-annually in arrears at the end of
the then relevant interest period at the rate of one half of one per cent.
below LIBOR as determined on the first Business Day of each such interest
period. The first interest payment will be made on 31 December 2003 in
respect of the period from and including the date of issue of the relevant
Loan Notes up to (but excluding) that date.
ING Barings has advised that, based on market conditions on 2 April 2003
(the last practicable date prior to this announcement), its estimate of the
value of the Loan Notes, if they had been in issue on that date, would have
been not less than 98 pence per #1 in nominal value of the Loan Notes.
The Loan Note Alternative will be conditional upon the Offer becoming or
being declared unconditional in all respects and valid elections having been
received by such time for at least #10 million in nominal value of Loan
Notes. A maximum of #152.5 million in nominal value of Loan Notes will be
available to be issued under the Loan Note Alternative. To the extent that
valid elections for the Loan Notes exceed the maximum available, such
elections shall be scaled back pro rata as nearly as practicable, according
to the number of shares for which a Loan Note election has been made.
The Loan Note Alternative will remain open for so long as the Offer remains
open for acceptance. If the Offer becomes or is declared unconditional in
all respects but sufficient valid elections for the Loan Notes are not
received, no Loan Notes will be issued unless GondolaExpress determines
otherwise.
The Loan Notes will not be listed on any stock exchange, nor is it intended
that any trading facility will exist for the Loan Notes.
Further details of the Loan Notes will be contained in the Offer Document.
5. Background to and reasons for the Offer and recommendation
Recent trading conditions
PizzaExpress was floated on the London Stock Exchange in 1993 and, as a
publicly listed company, enjoyed a record of uninterrupted profit growth
from 1993 until the publication of its most recent annual results for the
year ended 30 June 2002.
On 24 June 2002, the Company released a trading update ahead of the
publication of the preliminary results for the year ended 30 June 2002. This
statement noted the ongoing tough trading conditions in London and within
the M25 generally, the core market for PizzaExpress, as well as a weakening
of sales growth in the fourth quarter outside London. As a result, the
Company indicated that overall like-for-like sales for the second half of
the year ended 30 June 2002 were expected to decline by approximately 1 per
cent.
The preliminary results for the year ended 30 June 2002, released on 10
September 2002, reflected a number of economic factors and particularly the
increased competition in PizzaExpress's core market, leading to a decline in
both like-for-like sales growth and profitability. Whilst turnover increased
15 per cent. to #213.7 million due to significant restaurant openings,
like-for-like sales in the core PizzaExpress business fell by 1.5 per cent.
in the second half of the year reducing the annual figure to an overall
increase of only 1 per cent. Profit before taxation, exceptionals and losses
on discontinued operations was down 0.5 per cent. from #39.9 million to
#39.7 million.
The poor like-for-like sales performance was particularly acute in
restaurants situated within the M25 and over 10 years old. The Board of
PizzaExpress therefore announced an accelerated capital investment programme
focused on this older part of the restaurant estate.
Since the Company's 2002 financial year end, like-for-like trading has
continued to deteriorate. The Company announced on 9 October 2002 a first
quarter like-for-like sales decline of 4.4 per cent. in the PizzaExpress UK
and Ireland restaurants, highlighting difficult trading within the M25 in
particular. The Board of PizzaExpress reiterated its confidence that the
accelerated capital investment programme would restore like-for-like sales
in the longer term, but that overall market conditions remained very
difficult.
Interim results for the six months ended 31 December 2002
The interim results for the six months ended 31 December 2002 were released
on 11 February 2003 and reflected a continuation of disappointing trading in
the core PizzaExpress restaurants. Compared with the interim results for the
six months ended 31 December 2001, Group turnover rose 7.9 per cent. to
#112.0 million but like-for-like sales deteriorated further showing a
decline of 4.8 per cent., with sales within the M25 10 per cent. lower and
sales outside the M25 flat. This directly impacted the operating margin on
continuing operations which fell from 20.8 per cent. in 2001 to 15.6 per
cent. Profit before taxation, excluding exceptional items, fell 18.3 per
cent. to #17.8 million and basic earnings per share decreased by 19.4 per
cent. to 16.6 pence. The interim dividend was increased by 20 per cent. to 3
pence (net) per PizzaExpress Share underpinned by the Company's strong
balance sheet.
During the period the Board of PizzaExpress introduced a number of
initiatives to try to mitigate the poor trading environment. Initiatives
included a further reorganisation of restaurant management as well as the
introduction of a range of incentivisation packages throughout the
PizzaExpress Group. A number of product changes were introduced in December
2002, notably larger pizze and PizzaExpress menu changes. Furthermore, the
accelerated refurbishment programme was commenced. The Board of PizzaExpress
believed that the many initiatives taken would aid recovery in the medium
term as market conditions improved.
Current trading
The interim results noted that, since the half year, trading conditions and
like-for-like sales had not improved in the core UK pizza operation and that
immediate prospects remained uncertain. Intense competition, coupled with
well documented economic and political factors, continue to delay
improvements in performance; indeed, sales in the core PizzaExpress business
have further weakened since the interim results announcement.
Recent approaches
On 4 November 2002, following a sharp rise in the share price of
PizzaExpress, the Board of PizzaExpress announced that it had received an
unsolicited approach concerning a possible offer for the Company. Subsequent
to this announcement, Twigway plc ("Twigway"), a newly-formed company
established by the shareholders of Sun Capital Partners Ltd and by
Capricorn, announced that it had approached the Company concerning a
potential offer for the Company at a price of 330 pence to 350 pence per
PizzaExpress Share.
The Board of PizzaExpress, together with its advisers, reviewed the options
available, including an evaluation of other potential interested parties.
The Directors of PizzaExpress, together with Credit Suisse First Boston, had
several meetings with Twigway concerning its approach but were unable to
reach agreement on the terms associated with Twigway's potential offer and,
as a result, discussions with Twigway were terminated on 20 November 2002.
Speculation concerning the possibility of the Company being taken private
led to a number of approaches and in addition a number of potentially
interested parties were contacted directly by Credit Suisse First Boston. On
16 December 2002, the Company made a further announcement confirming that it
had received further approaches concerning potential offers for the Company
including one from the current executive management team. As a result of the
management interest, a committee of the Independent Directors was formed to
consider all approaches.
The committee of Independent Directors, advised by Credit Suisse First
Boston, initiated a process whereby a number of interested parties were
provided with detailed information concerning the Company in a controlled
process over a number of weeks. The committee of Independent Directors met
frequently throughout this extensive process and on 27 February 2003, Venice
Bidder announced a recommended cash offer to acquire the entire issued and
to be issued ordinary share capital of PizzaExpress for 367 pence per
PizzaExpress Share. At the time of the announcement by Venice Bidder, this
was the highest offer received by the Independent Directors from all
interested parties.
Immediately following this announcement, TDR Capital and Capricorn, who had
been involved in the auction process, announced that they were considering
whether to make an offer for PizzaExpress at a premium to the Venice Bidder
Offer Price. Subsequent to the announcement of the Venice Bidder Offer, the
Executive Directors informed the Independent Directors that they had ceased
to pursue their own potential offer for the Company and so the full Board of
PizzaExpress has now taken reponsibility for considering the GondolaExpress
Offer.
The GondolaExpress Offer of 387 pence in cash for each PizzaExpress Share
represents a premium of 20 pence per PizzaExpress Share to the Venice Bidder
Offer Price, which has led the Directors of PizzaExpress to withdraw their
recommendation to accept the Venice Bidder Offer and recommend instead that
PizzaExpress Shareholders accept the GondolaExpress Offer.
Reasons for the offer
GondolaExpress believes that PizzaExpress is a fundamentally sound business
that has fallen out of favour with institutional investors, partly due to
specific performance issues and partly due to an institutional perception
that the Company is now an ex-growth business, and that the restaurant
sector in general faces a difficult period in the near future.
GondolaExpress believes that the continuing negative sentiment generated by
these circumstances is likely to have a detrimental effect on the Company's
senior management and staff and consequently have a negative impact on the
future performance of the business. GondolaExpress therefore believes that
the Offer allows PizzaExpress, its existing management and staff the
opportunity to realise the potential of the business away from the spotlight
of the public equity markets, with the support and assistance of
GondolaExpress.
GondolaExpress proposes to do this by refocusing the business on its core
operations, being the PizzaExpress-branded UK restaurant chain.
The Offer provides an immediate and certain opportunity for PizzaExpress
Shareholders to realise their investment for cash at a significant premium
to the price of PizzaExpress Shares immediately prior to the commencement of
the Offer Period, and at a premium to the Venice Bidder Offer.
6. Irrevocable undertakings and intentions to accept
The Executive Directors have irrevocably undertaken to accept the Offer in
respect of, in aggregate, 500,768 PizzaExpress Shares held or controlled by
them, representing approximately 0.7 per cent. of the Existing Issued Share
Capital of PizzaExpress.
GondolaExpress has received an irrevocable undertaking to accept the Offer
from a PizzaExpress institutional Shareholder in respect of, in aggregate,
6,131,707 PizzaExpress Shares, representing approximately 8.5 per cent. of
the Existing Issued Share Capital of PizzaExpress. The irrevocable
undertaking will cease to be binding in the event that a competing offer
which exceeds 405 pence in cash per PizzaExpress Share is made.
GondolaExpress has also received letters of intent to accept the Offer from
certain of PizzaExpress's institutional Shareholders in respect of, in
aggregate, 3,620,852 PizzaExpress Shares, representing approximately 5.0 per
cent. of the Existing Issued Share Capital of PizzaExpress.
Therefore as at the date of this announcement, in total, GondolaExpress and
parties acting in concert with it have received either an irrevocable
undertaking or a letter of intent to accept the Offer in respect of, in
aggregate, 10,253,327 PizzaExpress Shares, representing approximately 14.3
per cent. of the Existing Issued Share Capital of PizzaExpress.
7. Information on PizzaExpress
The first PizzaExpress restaurant was opened in Wardour Street, in London's
Soho, in 1965 and from this base the Company grew primarily in the UK and
then internationally through a mixture of owned and franchised restaurants.
PizzaExpress was floated on the London Stock Exchange in February 1993.
Three years later, a majority of those UK restaurants which were then
franchised were purchased by the Company thereby ensuring greater control of
the PizzaExpress brand.
Until 1998, the PizzaExpress Group pursued a growth strategy based on its
core brand, PizzaExpress restaurants. In 1998, the PizzaExpress Group
acquired the Cafe Pasta chain, a small pasta chain thereby diversifying away
from a single brand strategy. In February 2002, the PizzaExpress Group
acquired Gourmet Pizza Co. and Kettners Restaurant - two small formats with
distinctive market positions.
PizzaExpress is now a leading operator of branded pizza and pasta
restaurants in the UK and Irish market with 311 PizzaExpress restaurants and
15 Cafe Pasta or Marzano restaurants in addition to 5 Gourmet Pizza
restaurants. The PizzaExpress Group has also expanded internationally with 6
company-owned, 2 joint venture and 38 franchised restaurants in key cities
throughout Europe, the Middle East, and the Far East. PizzaExpress also
sells its produce through 320 Sainsbury's and 134 Waitrose supermarkets in
the UK and 7 stores in Hong Kong.
For the year ended 30 June 2002 (being the last date to which annual
accounts for PizzaExpress have been prepared), PizzaExpress reported
turnover of #213.7 million and a profit on ordinary activities before
taxation of #38.0 million. As at 30 June 2002, PizzaExpress had net assets
of #133.3 million.
On 11 February 2003, PizzaExpress announced interim results for the six
months ended 31 December 2002. The Company reported turnover of #112.0
million and a profit on ordinary activities before taxation and excluding
exceptional items of #17.8 million for the period.
8. Information on GondolaExpress
GondolaExpress is a newly-incorporated public limited liability company
registered in England and Wales which has been specifically formed for the
purpose of making the Offer. GondolaExpress is ultimately owned and
controlled by an English limited partnership, PandoraExpress LP, in which a
subsidiary of Capricorn and a fund managed by TDR Capital are investors.
The current directors of GondolaExpress are Manjit Dale, Stephen Robertson,
Robert 't Hooft and Charles Luyckx.
9. Information on TDR Capital
TDR Capital is a private equity partnership, established in 2002, between
Manjit Dale, Stephen Robertson and Tudor Capital (U.K.) Limited, a
subsidiary of Tudor Group Holdings LLC. TDR Capital was established to make
private equity investments, principally buyouts, in middle market companies
in Europe and is regulated in the UK by the Financial Services Authority.
TDR Capital has committed funds of EUR155 million and is seeking to raise
additional funds from a range of private and institutional investors.
10. Information on Capricorn
Capricorn is a European-managed global investment group, registered in the
British Virgin Islands. It invests in the restaurant, food and beverage
sector, and in the insurance and niche financial services sectors. The
geographical focus of its investments is in Europe, Africa, the US and
Australia. Capricorn owns 47 per cent. of Nando's International, which owns
or is the franchisor of some 400 restaurants in more than ten countries,
including 63 in the United Kingdom and generated turnover of approximately
#100 million for the year ended 28 February 2003.
Capricorn owns, directly or indirectly, more than 50 investee companies,
which together have more than 10,000 employees worldwide.
11. Financing of the Offer
The Offer is being financed out of cash resources being made available to
GondolaExpress pursuant to investments by Capricorn and a fund managed by
TDR Capital and debt financing from Bank of Scotland and Hutton Collins. The
debt financing facilities are conditional, inter alia, on the Offer becoming
or being declared unconditional in all respects.
12. Management and employees
The Board of GondolaExpress has given assurances to the Board of
PizzaExpress that, following the Offer becoming or being declared
unconditional in all respects, the existing employment rights, including
pension rights, of all employees of PizzaExpress will be fully safeguarded.
13. PizzaExpress Share Option Schemes and PizzaExpress Deferred Convertible
Shares
The Offer will extend to any PizzaExpress Shares unconditionally allotted or
issued, whilst the Offer remains open for acceptance (or such earlier date
as GondolaExpress may, subject to the Code, determine), as a result of the
exercise of options or the release of conditional share awards granted under
the PizzaExpress Share Option Schemes or on the conversion of any
PizzaExpress Deferred Convertible Shares.
Following the Offer becoming or being declared unconditional in all
respects, appropriate proposals will be made to participants in the
PizzaExpress Share Option Schemes to the extent that such options have not
been exercised or lapsed. Proposals will not be made where the exercise
prices of those options or conditional share awards are above the Offer
Price or, as appropriate, where the relevant performance criteria have not
been met.
Save as set out above, the Offer will not be made in respect of, and will
not extend to, the PizzaExpress Deferred Convertible Shares.
14. Break fee arrangements
As an inducement to GondolaExpress to make the Offer, PizzaExpress has
agreed to pay a break fee to GondolaExpress of #2.778 million, representing
one per cent. of the value of the Offer, in the event that the Offer lapses
or is withdrawn and before the lapse or withdrawal a Revised Venice Bidder
Offer is announced which subsequently becomes or is declared unconditional
in all respects.
GondolaExpress confirmed to the Board of PizzaExpress that it would not make
the Offer without entering into this limited break fee agreement with
PizzaExpress. This break fee will only be payable to GondolaExpress if
PizzaExpress Shareholders accept a higher revised offer from Venice Bidder,
if one were to be made.
PizzaExpress Shareholders should note that break fees are now commonplace in
UK public transactions. Although this break fee is in addition to that
already entered into by Venice Bidder, neither break fee will be payable if
no offer for the Company is successful and only one break fee will be
payable if one offer is successful.
15. Compulsory acquisition, de-listing and re-registration
If GondolaExpress receives acceptances under the Offer in respect of, and/or
otherwise acquires, 90 per cent. or more of the PizzaExpress Shares to which
the Offer relates and assuming that all of the other conditions of the Offer
have been satisfied or waived (if capable of being waived), GondolaExpress
intends to exercise its rights pursuant to the provisions of sections 428 to
430F (inclusive) of the Companies Act to acquire compulsorily the remaining
PizzaExpress Shares on the same terms as the Offer.
Assuming the Offer becomes or is declared unconditional in all respects,
GondolaExpress intends to procure the making of an application by
PizzaExpress to the UKLA for cancellation of the listing of PizzaExpress
Shares on the official list of the UKLA and to the London Stock Exchange for
cancellation of the admission to trading of PizzaExpress Shares on its
market for listed securities. It is anticipated that cancellation of
PizzaExpress's listing and admission to trading will take effect no earlier
than the later of (i) the expiry of any period during which PizzaExpress
Optionholders may elect to accept proposals made by GondolaExpress in
respect of subsisting options and conditional share awards granted under the
PizzaExpress Share Option Schemes or (ii) the expiry of 20 business days
after the Offer becomes or is declared unconditional in all respects.
Delisting will significantly reduce the liquidity and marketability of any
PizzaExpress Shares which are not the subject of a valid acceptance under
the Offer.
It is also proposed that, following the Offer becoming or being declared
unconditional in all respects and after the PizzaExpress Shares are
delisted, PizzaExpress will be re-registered as a private company under the
relevant provisions of the Companies Act.
16. Further information
Further information relating to the Offer and the Form of Acceptance is included
in the Appendices to this announcement, including the terms and conditions of
the Offer set out in Appendix I, and will be set out in the Offer Document.
The Offer Document will be posted to PizzaExpress Shareholders and (for
information only) to holders of PizzaExpress Deferred Convertible Shares and to
participants in the PizzaExpress Share Option Schemes as soon as practicable.
The Offer and acceptances thereof will be governed by English law.
The availability of the Offer to persons not resident in the United Kingdom may
be affected by the laws of their relevant jurisdictions. Such persons should
inform themselves about, and observe, any applicable requirements.
The sources and bases for certain information contained in this announcement are
set out in Appendix II to this announcement and will be contained in the Offer
Document.
The definitions of certain expressions used in this announcement are set out in
Appendix IV to this announcement and will be contained in the Offer Document.
ING Barings, which is regulated in the United Kingdom by The Financial Services
Authority, is acting exclusively for GondolaExpress and no one else in
connection with the Offer and will not be responsible to anyone other than
GondolaExpress for providing the protections afforded to its customers or for
providing advice in relation to the Offer or in relation to the contents of this
announcement or any transaction or arrangement referred to herein.
Credit Suisse First Boston is acting exclusively for PizzaExpress and no one
else in connection with the Offer and will not be responsible to anyone other
than PizzaExpress for providing the protections afforded to its customers or for
providing advice in relation to the Offer.
Neither the Offer nor the Loan Note Alternative will be made, directly or
indirectly, in or into the United States or by use of the mails of, or by any
means or instrumentality (including, without limitation, facsimile or other
electronic transmission, telex or telephone) of inter-state or foreign commerce
of, or any facility of, a national, state or other securities exchange of, the
United States, nor will it be made directly or indirectly in or into Canada,
Australia or Japan and the Offer cannot be accepted by any such use, means,
instrumentality or facility or from within the United States, Canada, Australia
or Japan or any other such jurisdiction if to do so would constitute a violation
of the relevant laws of such jurisdiction. Accordingly, copies of this
announcement, the Offer Document and the Form of Acceptance are not being, will
not be and must not be mailed or otherwise forwarded, distributed or sent in,
into or from the United States, Canada, Australia or Japan or any other such
jurisdiction if to do so would constitute a violation of the relevant laws of
such jurisdiction and persons receiving this press announcement, the Offer
Document and Form of Acceptance (including without limitation custodians,
nominees and trustees) must not mail, forward, distribute or send them in, into
or from the United States, Canada, Australia or Japan or any other such
jurisdiction if to do so would constitute a violation of the relevant laws of
such jurisdiction.
The Loan Notes which may be issued pursuant to the Offer have not been, nor will
they be, registered under the Securities Act or under the securities laws of any
state of the United States; the relevant clearances have not been, nor will they
be, obtained from the securities commission of any province or territory of
Canada; no prospectus has been lodged with, or registered by, the Australian
Securities and Investments Commission or the Japanese Ministry of Finance; and
the Loan Notes have not been, nor will they be, registered under, or offered in
compliance with, applicable securities laws of any state, province, territory or
jurisdiction of Canada, Australia or Japan or any other such jurisdiction if to
do so would constitute a violation of the relevant laws of such jurisdiction.
Accordingly, the Loan Notes may not (unless an exemption under relevant
securities laws is applicable) be offered, sold, resold, or delivered, directly
or indirectly, in, into or from the United States, Canada, Australia or Japan or
any other jurisdiction if to do so would constitute a violation of the relevant
laws of, or require registration thereof in, such jurisdiction or to, or for the
account or benefit of, any United States, Canadian, Australian or Japanese
person.
This announcement does not constitute, or form any part of, any offer for, or
solicitation of, any offer for securities. Any acceptance or other response to
the Offer should be made on the basis of the information contained in the Offer
Document.
The availability of the Offer and/or the Loan Note Alternative to PizzaExpress
Shareholders who are not resident in the United Kingdom may be affected by the
laws of their relevant jurisdictions. PizzaExpress Shareholders who are not so
resident should inform themselves about and observe such applicable
requirements.
The full terms and conditions of the Offer (including details of how the Offer
may be accepted) will be set out in the Offer Document and the Form of
Acceptance accompanying the Offer Document. In deciding whether or not to accept
the Offer in respect of their PizzaExpress Shares, PizzaExpress Shareholders
should rely only on the terms and conditions of the Offer and the information
contained, and procedures described, in the Offer Document and the Form of
Acceptance.
PizzaExpress Shareholders are strongly advised to read the Offer Document
because it will contain important information.
APPENDIX I
Conditions and principal further terms of the Offer and Form of Acceptance
PART A: Conditions of the Offer
The Offer, which will be made by ING Barings on behalf of GondolaExpress, will
comply with the provisions of the Code. The Offer will be made subject to the
following conditions:
a. valid acceptances being received (and not, where permitted, withdrawn) by not
later than 3.00 p.m. on the First Closing Date (or such later time(s) and/or
date(s) as GondolaExpress may, subject to the rules of the Code, decide) in
respect of such number of PizzaExpress Shares as, with PizzaExpress Shares
acquired or contracted to be acquired by GondolaExpress or any of its
associates after the time at which the Offer is made, aggregate not less
than 90 per cent. (or such lesser percentage as GondolaExpress may decide)
of the PizzaExpress Shares to which the Offer relates, provided that, unless
agreed by the Panel, this condition will not be satisfied unless
GondolaExpress and/or its wholly-owned subsidiaries have acquired or agreed
to acquire (pursuant to the Offer or otherwise), directly or indirectly,
PizzaExpress Shares carrying, in aggregate, over 50 per cent. of the voting
rights then normally exercisable at general meetings of PizzaExpress on such
basis as may be required by the Panel (including for this purpose, to the
extent (if any) required by the Panel, any voting rights attaching to any
shares which are unconditionally allotted or issued before the Offer becomes
or is declared unconditional as to acceptances, whether pursuant to the
exercise of conversion or subscription rights or otherwise); and for this
purpose (i) the expression "PizzaExpress Shares to which the Offer relates"
shall be construed in accordance with sections 428-430F of the Companies
Act; and (ii) shares which have been unconditionally allotted shall be
deemed to carry the voting rights which they will carry on issue;
b. the Office of Fair Trading in the United Kingdom indicating, in terms
reasonably satisfactory to GondolaExpress, that it is not the intention of
the Secretary of State for Trade and Industry to refer the proposed
acquisition of PizzaExpress by GondolaExpress or any matter arising
therefrom or related thereto to the Competition Commission;
c. no government or governmental, quasi-governmental, supranational, statutory
or regulatory body, or any court, institution, investigative body,
association, trade agency or professional or environmental body or (without
prejudice to the generality of the foregoing) any other person or body in
any jurisdiction (each, a "Relevant Authority") having decided to take,
instituted or implemented any action, proceedings, suit, investigation or
enquiry or enacted, made or proposed any statute, regulation or order or
otherwise taken any other step or done any thing, and there not being
outstanding any statute, legislation or order, that would or might
reasonably be expected to:
i. materially restrict, restrain, prohibit, delay, impose additional conditions
or obligations with respect to, or otherwise interfere with the
implementation of, the Offer or the acquisition of any PizzaExpress Shares
by GondolaExpress or any matters arising therefrom;
ii. result in a material delay in the ability of GondolaExpress, or render
GondolaExpress unable, to acquire some or all of the PizzaExpress Shares;
iii. require, prevent, delay or affect the divestiture by GondolaExpress or any
member of the Wider GondolaExpress Group or PizzaExpress or any member of
the Wider PizzaExpress Group of all or any material portion of their
businesses, assets or property or of any PizzaExpress Shares or other
securities in PizzaExpress or impose any material limitation on the ability
of any of them to conduct their respective businesses or own their
respective assets or properties or any part thereof;
iv. impose any material limitation on the ability of any member of the Wider
GondolaExpress Group to acquire or hold or exercise effectively, directly or
indirectly, all rights of all or any of the PizzaExpress Shares (whether
acquired pursuant to the Offer or otherwise);
v. require any member of the Wider GondolaExpress Group or the Wider
PizzaExpress Group to offer to acquire any shares or other securities or
rights thereover in any member of the Wider PizzaExpress Group owned by any
third party where such acquisition would be material;
vi. make the Offer or its implementation or the proposed acquisition of
PizzaExpress or any member of the Wider PizzaExpress Group or of any
PizzaExpress Shares or any other shares or securities in, or control of,
PizzaExpress, illegal, void or unenforceable in or under the laws of any
jurisdiction;
vii. impose any material limitation on the ability of any member of the Wider
GondolaExpress Group or the Wider PizzaExpress Group to co-ordinate its
business, or any part of it, with the business of any other member of the
Wider GondolaExpress Group or the Wider PizzaExpress Group; or
viii. otherwise materially adversely affect any or all of the businesses,
assets, prospects or profits of any member of the Wider GondolaExpress Group
or the Wider PizzaExpress Group or the exercise of rights of shares of any
company in the PizzaExpress Group,
and all applicable waiting periods during which such Relevant Authority
could institute or implement any such action, proceeding, suit,
investigation, enquiry or reference or otherwise intervene having expired,
lapsed or been terminated;
a. all authorisations, orders, grants, consents, clearances, licences,
permissions and approvals, in any jurisdiction, necessary for or in respect
of the Offer, the proposed acquisition of any shares or securities in, or
control of, PizzaExpress or any member of the Wider PizzaExpress Group by
any member of the Wider GondolaExpress Group or the carrying on of the
business of any member of the Wider PizzaExpress Group or the Wider
GondolaExpress Group or any matters arising therefrom being obtained in
terms reasonably satisfactory to GondolaExpress from all appropriate
Relevant Authorities or (without prejudice to the generality of the
foregoing) from any persons or bodies with whom any members of the Wider
PizzaExpress Group or the Wider GondolaExpress Group has entered into
contractual arrangements and such authorisations, orders, grants, consents,
clearances, licences, permissions and approvals remaining in full force and
effect and there being no intimation of any intention to revoke or not to
renew the same and all necessary filings having been made, all appropriate
waiting and other time periods (including extensions thereto) under any
applicable legislation and regulations in any jurisdiction having expired,
lapsed or been terminated and all necessary statutory or regulatory
obligations in any jurisdiction in respect of the Offer or the proposed
acquisition of PizzaExpress by GondolaExpress or of any PizzaExpress Shares
or any matters arising therefrom having been complied with;
b. appropriate assurances being received, in terms reasonably satisfactory to
GondolaExpress, from the Relevant Authorities or any party with whom any
member of the Wider PizzaExpress Group has any contractual or other
relationship that the interests held by any member of the Wider PizzaExpress
Group under licences, leases, consents, permits and other rights will not be
materially adversely amended or otherwise affected by the Offer or the
proposed acquisition of PizzaExpress or any matters arising therefrom, that
such licences, leases, consents, permits and other rights remain in full
force and effect and that there is no intention to revoke or amend any of
the same;
c. save as publicly announced by PizzaExpress prior to 3 April 2003 and in each
case delivered to a Regulatory Information Service (as defined in the
Listing Rules) or as fairly disclosed in writing to GondolaExpress or its
advisers by PizzaExpress or its advisers in connection with the Offer prior
to 3 April 2003 (such information hereafter in these conditions being
referred to as being "publicly announced") there being no provision of any
material agreement, instrument, permit, licence or other material
arrangement to which any member of the Wider PizzaExpress Group is a party
or by or to which it or any of its material assets may be bound or subject
which, as a consequence of the Offer or the acquisition of PizzaExpress or
because of a change in the control or management of PizzaExpress or any
member of the PizzaExpress Group or any matters arising therefrom or
otherwise, could or might reasonably be expected to have the result that:
i. any monies borrowed by, or other indebtedness, actual or contingent, of, or
grant available to, any member of the Wider PizzaExpress Group becomes or is
capable of being declared repayable immediately or earlier than the
repayment date stated in such agreement, instrument or other arrangement or
the ability of any member of the Wider PizzaExpress Group to borrow monies
or incur indebtedness is withdrawn, inhibited or materially adversely
affected;
ii. any mortgage, charge or other security interest is created over the whole or
any material part of the business, property or assets of any member of the
Wider PizzaExpress Group or any such security (whenever arising) becomes
enforceable;
iii. any such agreement, instrument, permit, licence or other arrangement, or
any right, interest, liability or obligation of any member of the Wider
PizzaExpress Group therein, is terminated or materially adversely modified
or affected or any material action is taken or onerous obligation arises
thereunder;
iv. the financial or trading position of any member of the Wider PizzaExpress
Group is prejudiced or materially adversely affected;
v. any material asset of the Wider PizzaExpress Group being or falling to be
charged or disposed of;
vi. the rights, liabilities, obligations or interests or business of any member
of the Wider PizzaExpress Group in or with any other person, firm or company
(or any arrangement relating to such interest or business) is terminated,
modified or materially adversely affected; or
vii. any member of the Wider PizzaExpress Group ceases to be able to carry on
business under any name under which it currently does so;
a. since 30 June 2002 (being the date to which the latest published audited
report and accounts of PizzaExpress were made up) and save as disclosed in
PizzaExpress's published report and accounts for the year ended 30 June 2002
or save as publicly announced (as such term is defined in condition (f)
above) and in each case delivered to a Regulatory Information Service (as
defined in the Listing Rules) prior to 3 April 2003, being the date upon
which the Offer was announced, no member of the PizzaExpress Group having:
i. issued or agreed to issue or authorised or proposed the issue of additional
shares of any class or issued or authorised or proposed the issue of or
granted securities convertible into or rights, warrants or options to
subscribe for or acquire such shares or convertible securities (save for the
issue of any PizzaExpress Shares pursuant to the exercise of options granted
under the PizzaExpress Share Option Schemes, as disclosed by PizzaExpress to
GondolaExpress) or redeemed, purchased or reduced or announced any intention
to do so or made any other change to any part of its share capital;
ii. recommended, declared, paid or made or proposed to recommend, declare, pay
or make any dividend, bonus or other distribution other than dividends
lawfully paid to PizzaExpress or wholly-owned subsidiaries of PizzaExpress;
iii. authorised or proposed or announced its intention to propose any merger or
acquisition or disposal or transfer of assets or shares or any change in its
share or loan capital;
iv. issued or authorised or proposed the issue of any debentures or incurred or
materially increased any indebtedness or contingent liability;
v. disposed of or transferred, mortgaged or encumbered any material asset or any
right, title or interest in any material asset or entered into or varied any
material contract, commitment or arrangement (whether in respect of capital
expenditure or otherwise) which is of a long term or unusual nature or which
involves or could involve an obligation of a nature or magnitude which is
material or authorised, proposed or announced any intention to do so;
vi. entered into or varied or proposed to enter into or vary any contract,
reconstruction, amalgamation, arrangement or other transaction which is of a
long term or unusual or onerous nature or is otherwise than in the ordinary
course of business which is material or announced any intention to do so;
vii. entered into, or varied the terms of, any contract or agreement with any of
the directors or senior executives of PizzaExpress in any material respect;
viii. taken or proposed any corporate action or had any legal proceedings
started against it for its winding-up, dissolution or reorganisation or for
the appointment of a receiver, administrator, administrative receiver,
trustee or similar officer of all or any of its assets and revenues;
ix. waived or compromised any claim other than in the ordinary course of
business and which is material;
x. made any amendment to its memorandum or articles of association;
xi. entered into any contract, transaction or arrangement which is or is
reasonably likely to be restrictive on the business of any member of the
Wider PizzaExpress Group or the Wider GondolaExpress Group;
xii. entered into any contract, commitment or agreement with respect to any of
the transactions or events referred to in this condition (g); and
xiii. been unable or admitted 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;
a. since 30 June 2002 (being the date to which the latest published audited
report and accounts of PizzaExpress were made up) and save as disclosed in
PizzaExpress's published report and accounts for the year ended 30 June 2002
or save as publicly announced (as such term is defined in condition (f)
above) and in each case delivered to a Regulatory Information Service (as
defined in the Listing Rules) prior to 3 April 2003, being the date upon
which the Offer was announced:
i. no material litigation, arbitration, prosecution or other legal proceedings
having been instituted, announced or threatened or become pending or
remained outstanding by or against any member of the Wider PizzaExpress
Group or to which any member of the Wider PizzaExpress Group is or may
become a party (whether as plaintiff, defendant or otherwise);
ii. no material adverse change having occurred in the business, assets,
financial or trading position, profits or prospects of any member of the
Wider PizzaExpress Group;
iii. no investigation by any Relevant Authority having been threatened,
announced, implemented or instituted or remaining outstanding and which is
or may be material;
a. Save as publicly announced (as such term is defined in condition (f) above)
GondolaExpress not having discovered that:
i. any business, financial or other information concerning any member of the
PizzaExpress Group disclosed, publicly or otherwise at any time to
GondolaExpress or its advisers, by or on behalf of any member of the
PizzaExpress Group, either contains a material misrepresentation of fact or
omits to state a fact necessary to make the information contained therein
not materially misleading; or
ii. any member of the Wider PizzaExpress Group is subject to any material
liability, actual or contingent, which is not disclosed in the annual report
and accounts of PizzaExpress for the financial year ended 30 June 2002;
a. GondolaExpress not having discovered that:
i. any past or present member of the Wider PizzaExpress Group has not complied
with all applicable legislation or regulations of any jurisdiction with
regard to the storage, disposal, discharge, spillage, leak or emission of
any waste or hazardous substance or any substance likely to impair the
environment or to harm human health or otherwise relating to environmental
matters (which non-compliance might give rise to any material liability
(whether actual or contingent) on the part of any member of the Wider
PizzaExpress Group) or that there has otherwise been any such disposal,
discharge, spillage, leak or emission (whether or not the same constituted a
non-compliance by any person with any such legislation or regulations and
wherever the same may have taken place) which in any such case might give
rise to any material liability (whether actual or contingent) on the part of
any member of the Wider PizzaExpress Group;
ii. there is or is likely to be any material liability (whether actual or
contingent) to make good, repair, reinstate or clean up any property now or
previously owned, occupied or made use of by any past or present member of
the Wider PizzaExpress Group or any controlled waters under any
environmental legislation, regulation, notice, circular or order of any
Relevant Authority or third party or otherwise;
iii. that circumstances exist (whether as a result of the making of the Offer or
otherwise) which will or are reasonably likely to lead to any Relevant
Authority instituting or any member of the Wider PizzaExpress Group or the
Wider GondolaExpress Group might be required to institute, an environmental
audit or take any other steps which in any such case might result in any
material actual or contingent liability to improve or install new plant or
equipment or make good, repair, re-instate or clean up any land or other
asset now or previously owned, occupied or made use of by any member of the
Wider PizzaExpress Group; or
iv. circumstances exist whereby a person or class of persons might have any
material claim or claims in respect of any product or process of manufacture
or materials used therein now or previously manufactured, sold or carried
out by any past or present member of the Wider PizzaExpress Group.
GondolaExpress reserves the right to waive all or any of conditions (b) to (j)
(inclusive) above, in whole or in part. Conditions (b) to (j) (inclusive) must
be satisfied as at, or waived on or before, 21 days after the later of the First
Closing Date and the date on which condition (a) is fulfilled (or in each case
such later date as the Panel may agree) provided that GondolaExpress shall be
under no obligation to waive or treat as satisfied any of conditions (b) to (j)
(inclusive) by a date earlier than the latest date specified above for the
satisfaction thereof notwithstanding that the other conditions of the Offer 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.
If GondolaExpress is required by the Panel to make an offer for PizzaExpress
Shares under the provisions of Rule 9 of the Code, GondolaExpress may make such
alterations to the conditions as are necessary to comply with the provisions of
that Rule.
The Offer will lapse if it is referred to the Competition Commission before 3.00
p.m. on the first closing date of the Offer or the date when the Offer becomes
or is declared unconditional as to acceptances, whichever is the later.
The Offer will be governed by English law and subject to the jurisdiction of the
English courts and to the conditions and further terms set out below and to be
set out in the Offer Document and the related Form of Acceptance.
PART B: Principal further terms of the Offer
Neither the Offer nor the Loan Note Alternative will be made, directly or
indirectly, in or into the United States or by use of the mails of, or by any
means or instrumentality (including, without limitation, facsimile or other
electronic transmission, telex or telephone) of inter-state or foreign commerce
of, or any facility of, a national, state or other securities exchange of, the
United States, nor will it be made directly or indirectly in or into Canada,
Australia or Japan and the Offer cannot be accepted by any such use, means,
instrumentality or facility or from within the United States, Canada, Australia
or Japan or any other such jurisdiction if to do so would constitute a violation
of the relevant laws of such jurisdiction. Accordingly, copies of this
announcement, the Offer Document and the Form of Acceptance are not being, will
not be and must not be mailed or otherwise forwarded, distributed or sent in,
into or from the United States, Canada, Australia or Japan or any other such
jurisdiction if to do so would constitute a violation of the relevant laws of
such jurisdiction and persons receiving this press announcement, the Offer
Document and Form of Acceptance (including without limitation custodians,
nominees and trustees) must not mail, forward, distribute or send them in, into
or from the United States, Canada, Australia or Japan or any other such
jurisdiction if to do so would constitute a violation of the relevant laws of
such jurisdiction.
The Loan Notes which may be issued pursuant to the Offer have not been, nor will
they be, registered under the Securities Act or under the securities laws of any
state of the United States; the relevant clearances have not been, nor will they
be, obtained from the securities commission of any province or territory of
Canada; no prospectus has been lodged with, or registered by, the Australian
Securities and Investments Commission or the Japanese Ministry of Finance; and
the Loan Notes have not been, nor will they be, registered under, or offered in
compliance with, applicable securities laws of any state, province, territory or
jurisdiction of Canada, Australia or Japan or any other such jurisdiction if to
do so would constitute a violation of the relevant laws of such jurisdiction.
Accordingly, the Loan Notes may not (unless an exemption under relevant
securities laws is applicable) be offered, sold, resold, or delivered, directly
or indirectly, in, into or from the United States, Canada, Australia or Japan or
any other jurisdiction if to do so would constitute a violation of the relevant
laws of, or require registration thereof in, such jurisdiction or to, or for the
account or benefit of, any United States, Canadian, Australian or Japanese
person.
PizzaExpress Shares will be acquired under the Offer free from all liens,
equities, charges, encumbrances and other interests and together with all rights
attaching thereto.
The full terms and conditions of the Offer (including details of how the Offer
may be accepted) will be set out in the Offer Document and the Form of
Acceptance accompanying the Offer Document. In deciding whether or not to accept
the Offer in respect of their PizzaExpress Shares, PizzaExpress Shareholders
should rely only on the terms and conditions of the Offer and the information
contained, and procedures described, in the Offer Document and Form of
Acceptance.
APPENDIX II
Bases of calculation and sources of information
a. The value placed by the Offer on the Existing Issued Share Capital, and other
statements made by reference to the Existing Issued Share Capital, of
PizzaExpress are based upon 71,776,724 PizzaExpress Shares in issue on 2
April 2003 and, as the context requires, such options or conditional share
awards where the exercise price is below the Offer Price and/or, as
appropriate, where the relevant perfromance criteria have been met.
b. The closing middle market prices of PizzaExpress Shares are derived from the
Official List and represent closing middle market prices for PizzaExpress
Shares on the relevant dates.
c. Unless otherwise stated, the financial information relating to PizzaExpress
is extracted from the audited financial statements of PizzaExpress for the
relevant financial year or from the interim results statement of
PizzaExpress for the period ended 31 December 2002.
APPENDIX III
Responsibility
1. Responsibility
a. Manjit Dale and Stephen Robertson, on behalf of the relevant investment
committee of TDR Capital, which is responsible for approving investment
recommendations made by TDR Capital, accept responsibility for the
information contained in this announcement relating to TDR Capital.
b. Robert 't Hooft and Charles Luyckx, on behalf of the Board of Capricorn,
accept responsibility for the information contained in this announcement
relating to Capricorn.
c. The Directors of GondolaExpress, whose names are set out in paragraph 2
below, accept responsibility for the information contained in this
announcement other than the information contained in this announcement
relating to TDR Capital, Capricorn or the PizzaExpress Group, the Directors
of PizzaExpress and their connected persons or the recommendations and
associated opinions of the Board of PizzaExpress.
d. The Directors of PizzaExpress, whose names are set out in paragraph 3 below,
accept responsibility for the information contained in this announcement
relating to the PizzaExpress Group. The Directors also accept responsibility
for the information contained in this document relating to the Directors of
PizzaExpress and their connected persons and for the Directors' opinion
relating to the recommendation of the Offer.
2. Directors of GondolaExpress
Manjit Dale
Stephen Robertson
Robert 't Hooft
Charles Luyckx
3. Directors of PizzaExpress
Nigel Colne
David Page
Paul Campbell
John Metcalf
Nicholas Taylor
David Sykes
Ian Thomson
Janet Walker
APPENDIX IV
Definitions
The following definitions apply throughout this announcement, unless the context otherwise requires:
"Australia" the Commonwealth of Australia, its states, territories or possessions
"Bank of Scotland" The Governor and Company of the Bank of Scotland
"Board" or "Directors" as the context requires, the board of directors of PizzaExpress or the board of
directors of GondolaExpress
"Business Day" a day (excluding Saturdays, Sundays and public holidays) on which banks are
generally open for business in the City of London other than solely for trading
and settlement in Euro
"Canada" Canada, its possessions and territories and all areas subject to its jurisdiction
or any political sub division thereof
"Capricorn" Capricorn Ventures International Limited
"City Code" or "Code" The City Code on Takeovers and Mergers
"Closing Price" the closing, middle market quotation of a PizzaExpress Share as derived from the
Official List
"Companies Act" or "Act" The Companies Act 1985, as amended
"Company" or "PizzaExpress" PizzaExpress PLC
"Credit Suisse First Boston" Credit Suisse First Boston (Europe) Limited, financial adviser to PizzaExpress
"Escrow Agent" Computershare Investor Services PLC, in its capacity as escrow agent (as defined
by the CREST Manual issued by CRESTCo) for the purposes of the Offer
"Executive Directors" David Page, John Metcalf, Paul Campbell, David Sykes and Nicholas Taylor, each of
whom is a director of PizzaExpress
"Existing Issued Share Capital" the existing issued ordinary shares of 10 pence each in the capital of the Company
having the rights set out in the articles of association of PizzaExpress, as at
the date of this announcement
"First Closing Date" the first closing date of the Offer
"Form of Acceptance" the form of acceptance, authority and election relating to the Offer, accompanying
the Offer Document
"FSA" or "Financial Services The Financial Services Authority Limited
Authority"
"GondolaExpress" GondolaExpress PLC, a company recently incorporated in England and Wales (with
company number 4709081) specifically for the purpose of effecting the Offer
"GondolaExpress Group" Pandora LP, PandoraExpress 1 Limited, PandoraExpress 2 Limited, PandoraExpress 3
Limited, PandoraExpress 4 Limited, PandoraExpress 5 Limited and GondolaExpress
"Hutton Collins" Hutton Collins LP
"Independent Directors the independent directors of PizzaExpress, being Nigel Colne, Ian Thomson and
Janet Walker
"ING Barings" the investment banking division of ING Bank N.V., London Branch, financial adviser
to GondolaExpress
"Japan" Japan, its cities, prefectures, territories and possessions
"LIBOR" the average (rounded down where necessary to the nearest whole multiple of one
sixteenth of one per cent.) of the respective rates per annum at which any two
London clearing banks selected by GondolaExpress are prepared to offer six month
sterling deposits with leading banks in the London Inter Bank Market as at 11.00
a.m. (London time) on the first day of the relevant interest period or, if such a
day is not a Business Day, on the next succeeding Business Day, having regard to
the aggregate amount in respect of which the rate of interest is to be applied
"Listing Rules" the listing rules of the UKLA
"Loan Notes" the floating rate guaranteed unsecured loan notes of GondolaExpress to be issued
pursuant to the Loan Note Alternative
"Loan Note Alternative" the alternative under the Offer whereby PizzaExpress Shareholders (other than
certain Overseas Shareholders) who validly accept the Offer may elect to receive
Loan Notes instead of some or all of the cash consideration to which they would
otherwise be entitled under the Offer
"Loan Note Holder(s)" or holder(s) of Loan Notes
"Noteholder(s)"
"London Stock Exchange" London Stock Exchange plc
"Offer" or "GondolaExpress Offer" the recommended cash offer (including the Loan Note Alternative) to be made by ING
Barings on behalf of GondolaExpress to acquire the entire issued and to be issued
ordinary share capital of PizzaExpress, not already owned by GondolaExpress, on
the terms and subject to the conditions set out or referred to in the Offer
Document and the accompanying Form of Acceptance relating thereto including, where
the context permits or requires, any subsequent revision, variation, extension or
renewal thereof
"Offer Document" the document to be despatched to PizzaExpress Shareholders containing and setting
out the terms and conditions of the Offer and any revision thereof
"Offer Period" the period commencing on 16 December 2002 (the date on which PizzaExpress
announced that it had received an approach which might or might not lead to an
offer being made for the Company) and ending on whichever of the following dates
shall be the latest: (i) 3.00 p.m. on the First Closing Date; (ii) the time and
date on which the Offer becomes unconditional as to acceptances; or (iii) the time
and date on which the Offer lapses
"Offer Price" 387 pence per PizzaExpress Share
"Official List" the Daily Official List of the London Stock Exchange
"Overseas Shareholders" PizzaExpress Shareholders who are resident in, or citizens of, jurisdictions
outside the UK
"Panel" The Panel on Takeovers and Mergers
"PizzaExpress" or the "Company" PizzaExpress PLC
"PizzaExpress Deferred Convertible the existing issued deferred convertible shares of 5 pence each in the capital of
Shares" the Company having the rights set out in the articles of association of
PizzaExpress
"PizzaExpress Group" or "Group" PizzaExpress and its subsidiary undertakings and, where the context permits, each
of them
"PizzaExpress Optionholders" means a holder of options or conditional share awards under the PizzaExpress Share
Option Schemes
"PizzaExpress Shareholders" or holders of PizzaExpress Shares
"Shareholders"
"PizzaExpress Share Option Schemes" the PizzaExpress 1992 Executive Share Option Scheme (also known as the Star
Computer Group plc 1992 Executive Share Option Scheme), the PizzaExpress
Discretionary Share Option Scheme, the PizzaExpress Executive Share Option Scheme
and the PizzaExpress Long Term Incentive Plan
"PizzaExpress Shares" or "Shares" the existing unconditionally allotted or issued and fully paid ordinary shares of
10 pence each in the capital of PizzaExpress and any further such shares which are
unconditionally allotted issued and fully paid or credited as fully paid before
the date on which the Offer ceases to be open for acceptance (or such earlier date
as GondolaExpress may, subject to the Code, decide)
"pounds", "#" or "pence" the lawful currency of the United Kingdom
"Revised Venice Bidder Offer" an offer, tender offer, merger, scheme of arrangement, recapitalisation or other
transaction for or in respect of the ordinary shares of the Company which is made
after this announcement by Venice Bidder or an associate (as defined in the Code)
of Venice Bidder (including, without limitation, an announcement of such a
transaction) and which is in a cash amount in excess of the Offer or any
subsequent offer made by GondolaExpress and which comprises an amount on
announcement which GondolaExpress and PizzaExpress agree exceeds the value of the
Offer or any subsequent offer made by GondolaExpress or, failing such agreement,
is determined by an independent financial adviser (to be appointed by
GondolaExpress and PizzaExpress or, failing agreement by the parties within two
days of request by either party, to be appointed by LIBA at the request of either
party) as exceeding the value of the Offer or any subsequent offer made by
GondolaExpress
"Securities Act" the United States Securities Act of 1933, as amended
"subsidiary", "subsidiary shall be construed in accordance with the Companies Act (but for this purpose
undertaking", "associated ignoring paragraph 20(1)(b) of Schedule 4A of the Companies Act)
undertaking" or "undertaking"
"TDR Capital" TDR Capital LLP
"UK" or "United Kingdom" the United Kingdom of Great Britain and Northern Ireland
"UK Listing Authority" or "UKLA" the FSA acting in its capacity as the competent authority for the purposes of Part
VI of the Financial Services Act and Markets Act 2000
"United States of America", "US" or the United States of America, its possessions and territories, all areas subject
"United States" to its jurisdiction or any subdivision thereof, any State of the United States and
the District of Columbia
"US person" a US person as defined in Regulation S under the Securities Act
"Venice Bidder" Venice Bidder PLC
"Venice Bidder Offer" the offer made on 27 February 2003 by Hawkpoint Partners Limited on behalf of
Venice Bidder to acquire the entire issued and to be issued ordinary share capital
of PizzaExpress not already owned by Venice Bidder at the Venice Bidder Offer
Price
"Venice Bidder Offer Price" 367 pence per PizzaExpress Share
"Wider GondolaExpress Group" GondolaExpress and any respective subsidiaries, subsidiary and associated
undertakings and/or other body corporate, partnership, joint venture or person in
which GondolaExpress Group and such undertakings (aggregating their interests)
have an interest of more than 20 per cent. of the voting or equity capital or the
equivalent
"Wider PizzaExpress Group" the PizzaExpress Group and any subsidiaries, subsidiary and associated
undertakings and any other body corporate, partnership, joint venture or person in
which the PizzaExpress Group and such undertakings (aggregating their interests)
have an interest of more than 20 per cent. of the voting or equity capital or the
equivalent
All times referred to are London times unless otherwise stated.
This information is provided by RNS
The company news service from the London Stock Exchange
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