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TIDMNBI RNS Number : 4760O Northbridge Industrial Services PLC 30 June 2010 ? 30 June 2010 NORTHBRIDGE INDUSTRIAL SERVICES PLC ("NORTHBRIDGE", THE "COMPANY" OR THE "GROUP") PROPOSED ACQUISITION OF TASMAN OIL TOOLS PTY LIMITED PLACING OF 5,606,000 NEW ORDINARY SHARES TO RAISE APPROXIMATELY GBP7.0 MILLION AND NOTICE OF EXTRAORDINARY GENERAL MEETING Northbridge Industrial Services plc, the industrial services and rental company, today announces the proposed acquisition of Tasman Oil Tools Pty Ltd ("Tasman"). Highlights: · Proposed acquisition of Tasman for an aggregate consideration of A$16.9 million to be funded by a combination of the Placing, new banking facilities, the Consideration Shares and the Group's cash resources · Placing of 5,606,000 new Ordinary Shares by Arbuthnot Securities Limited with new and existing institutional and other investors at 125 pence per share representing a discount of approximately 6.0 per cent. to the closing mid-market price on 29 June 2010, to raise approximately GBP7.0 million before expenses · The Board expects that the Acquisition, if completed, would be immediately earnings enhancing · Tasman, based in Perth, Western Australia specialise in the rental of equipment for the onshore and off-shore oil industry throughout Australia · As part of the Placing, certain Directors and their related parties, have agreed to subscribe for an aggregate of 457,000 Placing Shares · The Placing and Acquisition are conditional on the Company entering into the Acquisition Agreement and the approval of Shareholders at an extraordinary general meeting of the Company to be held on 22 July 2010 Placing Statistics +------------------------------------------------+------------+ | Placing Price | 125p | +------------------------------------------------+------------+ | Number of Existing Ordinary Shares | 9,092,257 | +------------------------------------------------+------------+ | Number of Placing Shares | 5,606,000 | +------------------------------------------------+------------+ | Estimated net proceeds of the Placing | GBP6.7 | | receivable by the Company | million | +------------------------------------------------+------------+ | Number of Consideration Shares (based on the | 739,884 | | GBP:A$ exchange rate as at 29 June 2010) | | +------------------------------------------------+------------+ | Number of Ordinary Shares in issue immediately | 15,438,141 | | following Completion | | +------------------------------------------------+------------+ | Number of New Ordinary Shares expressed as a | 41.1 per | | percentage of the Enlarged Share Capital | cent. | | (excluding treasury shares) | | +------------------------------------------------+------------+ Commenting on the proposed Acquisition and the Placing, Eric Hook, Chief Executive of Northbridge said: "I am delighted to announce the proposed acquisition of Tasman. It is in line with our stated strategy of acquiring earnings enhancing specialist businesses in niche sectors which are capable of further organic growth. It will also significantly increase the size of Northbridge and give us greater critical mass and broadens our presence in the Asia Pacific region. "Tasman is strongly focused towards renting its equipment into the oil and gas industry with over 70 per cent. of the total revenue coming from this activity. We expect the acquisition to be immediately earnings enhancing and it will also create opportunities to cross sell our existing products from Tasman's locations, and Tasman will also benefit from Northbridge's Middle East and Caspian presence where there are some common customers. "I am also pleased to announce the completion of our successful Placing which has been strongly supported by our shareholders and which brings some well-respected shareholders onto the share register." For further information: +---------------------------------------+---------------------+ | Northbridge Industrial Services plc | 01283 531645 | | | | | Eric Hook, Chief Executive Officer | | | Ash Mehta, Finance Director | | | | | +---------------------------------------+---------------------+ | Smith & Williamson Corporate Finance | 020 7131 4000 | | Limited | | | (Nominated Adviser) | | | Azhic Basirov / David Jones | | | | | +---------------------------------------+---------------------+ | Arbuthnot Securities Limited (Broker) | 020 7012 2000 | | | | | Alasdair Younie / Ed Groome | | | | | +---------------------------------------+---------------------+ | Buchanan Communications | 020 7466 5000 | | | | | Charles Ryland / James Strong | | +---------------------------------------+---------------------+ PROPOSED ACQUISITION OF TASMAN OIL TOOLS PTY LTD PLACING OF 5,606,000 NEW ORDINARY SHARES AND NOTICE OF EXTRAORDINARY GENERAL MEETING 1. Introduction The Company announces that its subsidiary Northbridge Australia proposes to acquire Tasman for an aggregate consideration of A$16.9 million (GBP9.8 million) and intends to raise approximately GBP7.0 million (before expenses) by way of a placing of 5,606,600 new Ordinary Shares at a price of 125 pence per share. The net proceeds of the Placing will be used to fund part of the cash element of the consideration payable for Tasman and for additional working capital. The balance of the cash element of the consideration payable for Tasman will be satisfied using the Bank Facility and the Group's cash resources. The Placing and Acquisition are conditional on the Company entering into the Acquisition Agreement, which the Board expects to do shortly, and the approval of Shareholders at the EGM. Tasman, which is based in Perth, Western Australia, specialises in the rental of equipment for the onshore and offshore oil industry across Australia, supplying drilling and handling tools as well as a range of specialist plant including pumps, blow out preventers and mud pump motors. The proposed aggregate consideration payable for the entire issued share capital of Tasman will be A$16.9 million (GBP9.8 million), subject to certain adjustments, which is comprised of an initial consideration of A$13.9 million (GBP8.0 million) to be satisfied by A$12.3 million (GBP7.1 million) in cash from the proceeds of the Placing, the Bank Facility and the Group's cash resources and the issue of Consideration Shares representing A$1.6 million (GBP0.9 million). In addition, and dependent on there being no net asset adjustment or breach of warranty, it is proposed that Northbridge Australia will pay to the Vendor a Deferred Consideration of A$3.0 million (GBP1.7 million) which will be satisfied in cash payable in two instalments. The first instalment of the Deferred Consideration of A$1.0 million (GBP0.6 million) would be payable on 30 December 2010. The second instalment of the Deferred Consideration of A$2.0 million (GBP1.2 million) would be payable on 30 September 2011. The Directors believe that the Acquisition would complement Northbridge's existing businesses and is in line with the Company's stated strategy to acquire companies in specialist, niche sectors which are capable of further organic growth. Tasman operates in the attractive oil and gas sector and has a strong cash flow and hire fleet. The Acquisition would give the Company a foothold into the Asia-Pacific region and would provide the opportunity to distribute the Group's other products and services across Australia. If completed, the Board expects the Acquisition to be immediately earnings enhancing. The Placing Shares have been conditionally placed with institutional and other investors. Subject to, inter alia, the passing of the Resolutions at the EGM, Admission and dealings in the Placing Shares are expected to commence on AIM at 8.00 a.m. on 23 July 2010. Completion of the Acquisition is expected to occur and admission and dealings in the Consideration Shares are expected to commence on AIM at 8.00 a.m. on 30 July 2010. Certain Directors (and their related parties) and Western Selection plc have irrevocably undertaken to vote in favour of the Resolutions in respect of 3,498,397 Ordinary Shares, representing, in aggregate, approximately 39.1 per cent. of the Existing Ordinary Shares (excluding 152,150 Ordinary Shares held by the Company as treasury shares). The Acquisition will not proceed unless the Placing takes place. However, the Placing will proceed whether or not the Acquisition completes. In the unlikely event that the Acquisition does not complete, the net proceeds of the Placing will be placed on deposit on a short-term basis and the Directors will consider (MORE TO FOLLOW) Dow Jones Newswires June 30, 2010 02:00 ET (06:00 GMT)