BIDS.L Regulatory News (BIDS)

22 Jun 2007 07:01

ADDleisure PLC22 June 2007 ADDleisure plc / Ticker: ADE.L / Index: AIM / Sector: Leisure 22 June 2007 ADDleisure plc ('ADDleisure' or 'the Company') Signs £6.7m deal with BUPA ADDleisure, a market leader in health and leisure products and servicesinnovation, announces that BUPA, through its subsidiary BUPA Finance Plc('BUPA'), has conditionally agreed to subscribe for a 29.9% stake in the Companythrough a £3.0 million investment by way of a subscription of 60,600,000 newordinary shares of 0.5 pence each ("Ordinary Shares") at a subscription price of5 pence per share. BUPA has also conditionally agreed to make a further equity investment of £3.7million to acquire a 50% equity stake in ADDleisure's wholly-owned subsidiary,ADD Wellness Holdings Limited ("Midco"), which, following an internalre-organisation and the acquisition of certain minority interests by the Company("the Reorganisation"), will wholly own two product and service propositions:Fitbug Limited ("Fitbug") and Movers and Shapers Limited ("Movers & Shapers").As part of the agreement, BUPA will be allowed to appoint a Non- executiveDirector to the board of ADDleisure. These two subscriptions by BUPA are, interalia, conditional on the Reorganisation having completed before 17 August 2007.Following completion of the Reorganisation, application will then be made by theCompany for the 60,600,000 new Ordinary Shares which are to be issued to BUPA tobe admitted to trading on AIM. In addition, under the terms of an option agreement between the Company and BUPAto be entered into on completion, BUPA will be granted a right to subscribe forfurther new Ordinary Shares (at a subscription price equal to the prevailingmarket price of an Ordinary Share for the relevant preceding 20 business days)in order to maintain its 29.9% interest in the Company. The option is onlyexercisable should any warrants or options in issue (or capable of being issuedunder the Company's existing warrant instrument) at the date of the optionagreement, together with the employee option to be granted and detailed furtherbelow, be exercised. The agreement will enable ADDleisure to further develop its key products andservices - including Fitbug, Movers & Shapers and Ez-Book - and accelerate itsexpansion into the positive health and wellness territory, currently one of thefastest growing areas of the industry. ADDleisure's founders are some of the leisure industry's best-knownentrepreneurs: David Turner, co-founder of LA Fitness; Allan Fisher, founder ofHolmes Place; and David Cummin, founder of the software company Membertrack.Michael Warshaw, former Chairman of Molton Brown, is a shareholder in and aconsultant to the Company. In tandem with the support of BUPA, the Directors aimto strengthen and develop ADDleisure's position in the corporate and consumerhealthcare markets, where individuals are becoming more interested in proactivehealth management through improved nutrition, wellbeing and increased exercise. ADDleisure CEO David Turner said: "ADDleisure was formed to provide innovativehealth and wellbeing concepts to inspire individuals to take more responsibilityfor their health. The Fitbug and Movers & Shapers propositions, developedin-house by our team of experts, are proven wellbeing concepts that havereceived very positive feedback. "This deal not only endorses our strategy and product base but also givesADDleisure a powerful, long term strategic partner in BUPA, with whom we candeliver these and other innovative products and services into the expandingwellbeing market. BUPA provides us with additional know-how and financialresource to enable us to fulfil our objective of becoming a leading investor inand provider of health and leisure products and services to both the UK marketand overseas." BUPA Insurance Managing Director Fergus Kee said: "We see this partnership as animportant step in allowing us to increase our focus on positive health andwellness, whilst also retaining our market leading position in the care andtreatment of ill health. The combination of ADDleisure's management team andunique products and services together with our breadth of experience in thehealth and care industry will help us target new opportunities. "The Government's White Paper Choosing Health: making healthier choices easierputs the onus firmly on individuals to take more responsibility for their healthand wellbeing. It also suggested that the workplace represented the idealplatform on which to promote its welfare reform agenda. The independent sectorhas a crucial role to play in this arena." On completion, BUPA together with David Turner, David Cummin, and Allan Fisher(being directors of the Company) will each enter into lock-in agreements infavour of the Company, and where relevant BUPA, not to dispose of any of theOrdinary Shares registered in their respective names, save for limitedcircumstances, for a period of 24 months from completion and thereafter, for afurther 12 months, to only deal with their holdings of Ordinary Shares in anorderly manner with a view to the maintenance of an orderly market in theOrdinary Shares. Prior to 17 August 2007 the Company will acquire the minority interests in itssubsidiary company Fitbug, which currently equals 25 per cent. of Fitbug'sissued share capital, in consideration for the issue and allotment of 2,500,000new Ordinary Shares, in aggregate, at an issue price of 5 pence per share andthe Company will also acquire the minority interests in its subsidiary Movers &Shapers Limited, which currently equal 10 per cent. of Movers & Shapers issuedshare capital, in consideration for the issue and allotment of 10,000,000 newOrdinary Shares, in aggregate, at an issue price of 5 pence per share ("theReorganisation"). The Company will make application on or before 17 August 2007for the admission to trading on AIM of the 12,500,000 new Ordinary Shares whichare to be issued as the consideration payable by the Company for theReorganisation. In addition, the Company will grant employee options to subscribe up to8,201,389 new Ordinary Shares, at a subscription price of 5 pence per share("the Option"). The Option vests two years after grant subject, in part, tocertain performance criteria. Details of the BUPA agreement 1. On 21 June 2007 the Company entered into a conditional subscription agreementwith BUPA Finance Plc, a subsidiary of The British United Provident AssociationLimited, ("the Agreement") whereby conditional on, inter alia, theReorganisation, occurring on or before 17 August 2007, BUPA would subscribe for60,600,000 new Ordinary Shares at 5 pence per share and in addition, would alsosubscribe for 36,700,000 new ordinary shares of 10 pence each in Midco ("Midcoshares") at a subscription price of 10 pence per share. 2. Under the terms of the Agreement the Company has given certain warranties infavour of BUPA as regards the Company and its subsidiaries and other relatedmatters and has given certain undertakings in relation to the period prior tocompletion. 3. Under the terms of the Agreement it has been agreed that on completion BUPAand the Company will enter into a shareholders' agreement to govern theirrelationship as equal shareholders in Midco. 4. Under the terms of the Agreement it has also been agreed that on completion: 4.1 BUPA will be allowed to appoint a Non-executive Director to the board ofADDleisure; 4.2 an option agreement to be entered into pursuant to which BUPA will also begranted a right to subscribe for further new Ordinary Shares (at a subscriptionprice equal to the prevailing market price of an Ordinary Share for the relevantpreceding 20 business days) if any of the warrants (including warrants capableof being issued under the Company's existing warrant instrument) or options tosubscribe for Ordinary Shares which are in issue at the date of the Agreementare exercised. In addition, the company has undertaken to seek shareholderapproval to issue and allot the maximum number of Ordinary Shares under theoption at its next general meeting; 4.3 BUPA together with David Turner, David Cummin, and Allan Fisher will enterinto lock-in agreements in favour of the Company, and where relevant BUPA, notto dispose of any of the Ordinary Shares registered in their respective names asat the date of the Agreement becoming unconditional, save for limitedcircumstances, for a period of 24 months from completion and thereafter, for afurther period of 12 months, to only deal with their holdings of Ordinary Sharesin an orderly manner with a view to the maintenance of an orderly market in theOrdinary Shares. Details of the Reorganisation 1. The Company will acquire the minority shareholders' interests in Movers & Shapers from Michael Warshaw and others for consideration of £500,000 to be satisfied by the issue and allotment, credited as fully paid, of 10,000,000 new Ordinary Shares at an issue price of 5 pence per share. In addition the option agreement between the Company and Michael Warshaw and others as regards their holding of shares in Movers & Shapers dated 31 July 2006 will be surrendered; 2. The Company would then sell its entire holding of 500,000 ordinary shares of £1 each in the capital of Movers & Shapers to Midco in exchange for the issue and allotment to it of 33,363,626 Midco shares, credited as fully paid; 3. The Company would then acquire the 75 per cent. holding of its subsidiary ADDleisure 2004 Limited in Fitbug for consideration of £375,000 (such monies to remain outstanding on inter-company loan account); 4. The Company would then acquire the minority shareholders' interests in Fitbug (being 25 per cent. of the issued shares in Fitbug) from Paul Landau and others for consideration of £125,000 to be satisfied by the issue and allotment, credited as fully paid, of 2,500,000 new Ordinary Shares, in aggregate, at an issue price of 5 pence per share; 5. The Company would then sell its entire holding of 1,440 ordinary shares of £1 each in the capital of Fitbug to Midco in exchange for the issue and allotment to the Company of 3,336,364 new Midco Shares, credited as fully paid; 6. The issued share capital of Midco following completion of the Reorganisation and prior to the subscription by BUPA will be 36,700,000 ordinary shares of 10 pence each. * * ENDS * * For further information visit www.addleisure.com or contact: Ben Margolis ADDleisure Plc Tel: 020 7449 1000 Mark Percy/Liam O'Donoghue Seymour Pierce Tel: 020 7107 8000 Isabel Crossley St. Brides Media & Finance Ltd Tel: 020 7242 4477 About ADDleisure plc Floated on AIM in October 2004, ADDleisure believes that the increase inawareness of the importance of physical health and well-being has resulted in anopportunity to develop and promote new highly differentiated offerings to thehealth and leisure sectors. It has three key investments: Fitbug Limited, developers of an online personalhealth and well-being coach; Digital Plantation Limited, developers of Ez-Bookintelligent booking software; and Movers and Shapers Limited, a groundbreakingretail concept for health and fitness services. The Company has a highly experienced management team including Allan Fisher,founder and former CEO of Holmes Place plc; David Turner, founder and formerdirector of LA Fitness plc; and David Cummin, founder and former director ofMembertrack Limited, a leading club membership software provider. Additionally,Michael Warshaw, former Chairman of Molton Brown, is a consultant to theCompany. About BUPA BUPA is the UK market leader in health and care with a strong internationalpresence. Established in 1947, it has over 8 million customers in 190 countriesand 46,000 employees. Its main interests are health insurance, hospitals, carehomes for older people and young disabled, health assessments, workplace healthand childcare services. BUPA Travel offers a bespoke travel insurance service.Sanitas in Spain, HBA in Australia, IHI in Denmark and AMEDEX in the US are allpart of the BUPA Group which also has centres in Hong-Kong, Thailand and SaudiArabia. BUPA is a company limited by guarantee and does not have any sharecapital. As a result, it can focus on its customers, helping then to livelonger, healthier lives and can reinvest all of its profits to do this - this isthe dividend that BUPA provides. This information is provided by RNS The company news service from the London Stock Exchange