Saint Gobain Or Regulatory News (COD)

5 Oct 2005 17:08

Compagnie de Saint-Gobain05 October 2005 Not for release, publication or distribution, in whole or in part, in, into orfrom Australia, Canada or Japan 5 October 2005 Compagnie de Saint-Gobain ("Saint-Gobain") Cash Offer for BPB plc ("BPB") Response to BPB's statement on additional capital return Saint-Gobain notes today's announcement from BPB that it is increasing itsproposed return of capital from £350 million to £600 million and that it intendsto grow dividends by 88% over the next three years. Saint-Gobain questionswhether this is in the best interests of shareholders. BPB has been keen to stress its desire to create shareholder value throughlong-term growth. However, its initial response to Saint-Gobain's proposed offerwas to incur heavy borrowing to fund a very large share buyback and to offersignificantly increased dividends on the remaining outstanding shares. Today,it has decided to mortgage further the future of the company therebyjeopardising not only future growth prospects, but possibly its fundamentalstability. Saint-Gobain continues to believe that this offer would be better discussed in aprivate forum. Unfortunately, BPB does not want to do so. In light of this,Saint-Gobain believes there are a number of questions shareholders should beasking BPB: • If BPB implements this proposed buyback, what will the gearing level be over the next 5 years? • Is BPB's dividend level sustainable? What will the future level of dividend cover be? • Are BPB shareholders being asked to choose between growth or cash? • Is the sale of some of BPB's businesses the first sign that its growth plan will be difficult to finance given this new cash back strategy? • Isn't the whole cash back strategy increasing risk substantially for shareholders? Jean-Louis Beffa, Chairman and CEO of Saint-Gobain said: "Saint-Gobain believes that substantially increasing dividends and borrowingheavily to fund buy backs does not affect the fundamental value of the BPBbusiness. Our cash offer of 720p per share offers certainty and value for BPBshareholders today." Enquiries Saint-Gobain (for analysts and investors) Florence Triou-Teixeira, Head of IR Tel: +33 1 47 62 45 19 Alexandre Etuy, Deputy Head of IR Tel: +33 1 47 62 37 15 BNP Paribas (joint financial adviser to Saint-Gobain) Thierry Dormeuil Tel: +33 1 42 98 12 34 Oliver Ellingham Tel: +44 20 7595 2000 UBS Investment Bank (joint financial adviser and broker to Saint-Gobain) Charles-Henri Le Bret Tel: +33 1 48 88 30 30 Liam Beere Tel: +44 20 7567 8000 Brunswick (PR adviser to Saint-Gobain) John Sunnucks Tel: +44 20 7404 5959 Sophie Fitton Tel: +44 20 7404 5959 Notes Copies of the Offer Document and the Form of Acceptance are available forcollection (during normal business hours) from Capita Registrars at PO Box 166,The Registry, 34 Beckenham Road, Beckenham, Kent BR3 4TH. Further information on Saint-Gobain is available on Saint-Gobain's websitewww.saint-gobain.com. Terms used in this announcement shall have the meaning given to them in theOffer Document. The Offer in the United States is made solely by the Offeror and neither BNPParibas, UBS nor any of their respective affiliates is making the Offer into theUnited States. The Saint-Gobain Directors and the Offeror Directors accept responsibility forthe information contained in this announcement. To the best of the knowledge andbelief of the Saint-Gobain Directors and the Offeror Directors (who have takenall reasonable care to ensure that such is the case), the information containedin this announcement for which they are responsible is in accordance with thefacts and does not omit anything likely to affect the import of suchinformation. BNP Paribas and UBS are acting exclusively for Saint-Gobain and the Offeror inconnection with the Offer and no one else, and will not be responsible to anyoneother than Saint-Gobain and the Offeror for providing the protections affordedto respective clients of BNP Paribas and UBS nor for providing advice inrelation to the Offer or any other matter referred to herein. This announcement does not constitute an offer to sell or an invitation topurchase any securities or the solicitation of an offer to buy any securities. This information is provided by RNS The company news service from the London Stock Exchange