Dialight Regulatory News (DIA)

25 Aug 2005 07:04

Roxboro Group PLC25 August 2005 FOR RELEASE AT 7.00 A.M. ON 25 AUGUST 2005 THE ROXBORO GROUP PLC PROPOSED DISPOSAL OF THE SOLARTRON GROUP, RETURN OF CASH OF 150 PENCE PER SHARE TO ORDINARY SHAREHOLDERS, CHANGE OF NAME AND NEW EMPLOYEE SHARE SCHEME The Roxboro Group PLC, the international specialist electronics group, announcesthe proposed disposal of the Solartron Group, its electronic measurementbusiness, to Ametek Inc. Roxboro also announces that it intends to propose areturn of cash of 150 pence per Ordinary Share to Ordinary Shareholderstotalling a maximum of £46.6 million as well as a change of name, changes to theBoard and the adoption of the New Employee Share Scheme. This Disposal follows the sale of Mobrey in July 2005 and of Weston Aerospace in2003 and focuses the Group on Dialight, its applied LED technology and solidstate lighting business. Since 2003, Robin has realised in excess of £120million from disposals. Highlights: • Disposal of the Solartron Group to Ametek for £42.1 million payable in cash by Ametek at Completion • Profit after expenses and taxation on the Disposal of approximately £23.3 million • Conditional on Completion, the Company expects to return 150 pence per Ordinary Share to Ordinary Shareholders • Post Completion, the Group will be focused on its applied LED technology and solid state lighting company, Dialight, and consequently the remaining business will be renamed Dialight plc • Dialight is a market leader in the application of LED technology and anticipates strong growth in the emerging solid state lighting market where LED technology is increasingly replacing conventional light sources • The Board believes that the consideration for the Solartron Group fully reflects the prospects of the Solartron Group's business and that the Disposal will benefit both Roxboro and its Shareholders by enabling a significant return of capital to be made to Ordinary Shareholders, whilst also providing Roxboro with the funding to continue to invest in, and to take advantage of, the opportunities within Dialight • The Disposal, the change of name of Roxboro to Dialight plc, the Return of Cash and the adoption of the New Employee Share Scheme, are conditional, inter alia, on the approval of Ordinary Shareholders, which will be sought at two EGMs to be held in September 2005 • A circular containing, inter alia, further details on the Disposal and the proposed Return of Cash will be sent to Shareholders shortly Commenting on the Disposal, Harry Tee, Roxboro's Chief Executive, said: "I am delighted to be announcing this Disposal as it represents a significantrealisation of Shareholder value, and, together with proceeds of the Mobreydisposal we announced in June, enables us to make a significant return of cashto Shareholders. Over the past two years we have raised over £120 million from disposals andimportantly our activities are now focused on the high growth opportunities inDialight. Dialight applies LED technology into a wide range of products and applicationsand in particular the emergence of high brightness LEDs as a disruptivetechnology in the lighting sector creates very significant opportunities for theCompany. Already a leader in the road and rails signals, bus and truck, andobstruction segments, Dialight is now investing in the illumination market whereLEDs will increasingly replace conventional light sources. We believe LEDs are the lights of the future and Dialight plans to be a keyplayer in the field." Roxboro Harry Tee 01480 447 490 Alf Vaisey 01480 447 490 Close Brothers Andrew Cunningham 020 7655 3100 David Wardrop 020 7655 3100 JPMorgan Cazenove Julian Cazalet 020 7588 2828 Patrick Magee 020 7588 2828 gcg hudson sandler Alistair Mackinnon-Musson 020 7796 4133 Philip Dennis 020 7796 4133 E-mail: Roxboro@hspr.co.uk A circular (the "Circular") containing further details relating to the mattersdiscussed in this announcement and the convening of the EGMs will be sent toShareholders shortly. Close Brothers Corporate Finance Limited, which is regulated in the UnitedKingdom by The Financial Services Authority, is acting exclusively for TheRoxboro Group PLC and for no one else in relation to the Disposal and will notbe responsible to anyone other than The Roxboro Group PLC for providing theprotections afforded to clients of Close Brothers Corporate Finance Limited orfor providing advice in relation to the Disposal or on any matter referred toherein. JPMorgan Cazenove, which is regulated in the United Kingdom by The FinancialServices Authority, is acting exclusively for The Roxboro Group PLC and for noone else in relation to the Return of Cash and will not be responsible to anyoneother than The Roxboro Group PLC for providing the protections afforded toclients of JPMorgan Cazenove or for providing advice in relation to the Returnof Cash or on any matter referred to herein. FOR RELEASE AT 7.00 A.M. ON 25 AUGUST 2005 THE ROXBORO GROUP PLC PROPOSED DISPOSAL OF THE SOLARTRON GROUP, RETURN OF CASH OF 150 PENCE PER SHARE TO ORDINARY SHAREHOLDERS, CHANGE OF NAME AND NEW EMPLOYEE SHARE SCHEME 1. Introduction The Board of Roxboro announces that it has entered into a conditional agreementto sell the Solartron Group, Roxboro's electronic measurement business, toAmetek for £42.1 million, subject to Adjustments, payable in cash on Completion.Following the Disposal, the ongoing Roxboro Group will comprise solely theDialight division and consequently the Board is proposing that, following andconditional upon Completion, the Company be renamed Dialight plc and the Boardbe reorganised. The Board announced on 17 June 2005 that it would continue to review the Group'scapital requirements with a view to proposing a return of cash to OrdinaryShareholders within a reasonable period. As a result of the disposal by Roxboroof its Mobrey business to Emerson in July of this year and the Disposal (subjectto and conditional upon Completion), the Board is of the view that the Groupwill have generated sufficient net cash to enable Roxboro to propose a return of150 pence per share to Ordinary Shareholders totalling a maximum of £46.6million. Further details on the Return of Cash to Ordinary Shareholders will beset out in the Circular to be sent to Shareholders shortly and the Board expectsthat the proposed Return of Cash will take place before the year end. The Board is also proposing to introduce the New Employee Share Scheme as theCompany's existing Share Option Schemes have matured. Due to the size of the transaction, the Disposal is conditional, amongst otherthings, on the approval of Ordinary Shareholders, which is to be sought at the1st EGM. The change of name of Roxboro to Dialight plc (which is conditional onCompletion) and the adoption of the New Employee Share Scheme are each subjectto the approval of Ordinary Shareholders, which will be sought at the 2nd EGM. 2. Background to, and reasons for, the Disposal The circular to Shareholders in connection with the Mobrey Disposal, dated 27June 2005, explained that, since the disposal of Roxboro's aerospace sensorsbusiness, Weston Aerospace, in 2003, the Board has continued to review howadditional value in Roxboro could be generated and has continued to develop astrategy focused on niche, high-growth opportunities. The Board concluded that there was limited strategic rationale for Solartron(including Mobrey) and Dialight being part of the same group and that additionalshareholder value could potentially be generated by disposing of Solartron(including Mobrey) through several transactions. As a result, the Boardinitiated sale processes in respect of Solartron and Mobrey. This culminated inthe Mobrey Disposal, which was announced on 17 June 2005 and was completed on 15July 2005, and now the Disposal to Ametek, the terms of which the Board isrecommending to Ordinary Shareholders. The Board believes that the consideration for the Solartron Group fully reflectsthe prospects of the Solartron Group's business and that the Disposal willbenefit both Roxboro and its Shareholders by enabling a significant return ofcapital to be made to Ordinary Shareholders, whilst also providing Roxboro withthe funding to continue to invest in, and to take advantage of, theopportunities within the Continuing Group's applied LED technology business,Dialight. 3. Information on the Solartron Group The Solartron Group is a manufacturer of measurement and instrumentationequipment and is primarily focused on the oil and gas, metrology and materialsanalysis sectors. Solartron supplies electronic measurement systems to the oiland gas sectors under the Solartron ISA brand. Additionally, SolartronAnalytical sells a range of analytical instruments into the materials researchsector whilst Solartron Metrology produces gauging sensors for the qualitycontrol industry. The Solartron Group has approximately 280 employees based inthe UK, Europe and North America and its senior management team led by managingdirector, Mr. Allan Imrie, will continue with the Solartron Group followingCompletion. In the financial year ended 31 December 2004, the Solartron Group (excludingSolartron Analytical) generated gross profit of £6.8 million and operatingprofit of £3.1 million on turnover of £16.5 million. Not included within thesefinancial results are gross profits of £3.7 million and turnover of £8.5 millionrelating to Solartron Analytical the business and assets of which are beingacquired by Ametek under the terms of the Agreement. Prior to the MobreyDisposal, Solartron Analytical was a product line within the Mobrey Companiessold under the terms of the Mobrey Disposal and, consequently, appropriatefinancial information to present an analysis of the operating profit ofAnalytical is not available. However, overhead costs directly attributable tothe Analytical Product Line of £1.6 million have been identified for thefinancial year ended 31 December 2004. The net assets of the Solartron Group,including Solartron Analytical, at 31 December 2004 were £16.9 million. 4. Information on Ametek Ametek is a leading global manufacturer of electronic instruments and electricmotors. Ametek consists of two operating groups: Electronic Instruments, aleading manufacturer of advanced monitoring, testing, calibrating, measurementand display instruments sold to the process, aerospace, power and industrialmarkets worldwide; and Electromechanical, the world's largest manufacturer ofair-moving electric motors for floor-care, aerospace, military, mass transit,business equipment and medical devices. Ametek has approximately 8,300 employees at more than 70 plants and operationsin the United States and 18 other countries worldwide and had revenues ofapproximately US$1.2 billion in the financial year ended 31 December 2004. 5. Principal terms and conditions of the Disposal Under the terms of the Agreement, the aggregate consideration for the Disposalof £42.1 million is payable in cash, subject to Adjustments. The Agreementcontains certain warranties and indemnities given by Roxboro and itssubsidiaries to the UK Purchaser and the US Purchaser, which the Board considersto be appropriate for a transaction of this type. The Disposal is conditional upon Roxboro obtaining the approval of its OrdinaryShareholders at the 1st EGM and a mandatory regulatory competition clearance inGermany and is subject to there being no material adverse event in relation tothe Solartron Group before Completion. Completion is expected to occur on thesame date as (or shortly after) Ordinary Shareholder approval has been obtained. 6. Financial effects of the Disposal and use of proceeds The proceeds of the Disposal before expenses and taxation are expected to be£42.1 million before Adjustments. The net proceeds of the Disposal beforeAdjustments but after expenses and taxation are expected to be £33.1 million.Based on the Solartron Group's net assets (excluding intra-Group balances) of£7.4 million as at 31 December 2004 and after the charging of goodwill containedin the Roxboro Group balance sheet of £2.4 million, the Disposal would result ina profit after expenses and taxation of approximately £23.3 million on a proforma basis. The aggregate proceeds for the Mobrey Disposal and the disposal of the SolartronGroup before expenses and taxation are £68.1 million and after expenses andtaxation £53.6 million. The Board proposes to return 150 pence per OrdinaryShare to Ordinary Shareholders totalling a maximum of £46.6 million. The Board also proposes to pay approximately £7.0 million to eliminate theestimated deficits in the Group's UK defined benefit pension schemes calculatedunder FRS 17. Pending the Return of Cash, the proceeds from the Disposal will beheld on deposit. The Board expects that the aggregate net proceeds after tax and expenses fromthe disposals of Solartron Group and Mobrey of approximately £53.6 million willbe fully utilised in making the proposed return to Shareholders of up to £46.6million and the pension contribution of £7.0 million. All 936,333 options granted under the existing Share Option Schemes are alreadyexercisable. Depending on the number of these options that are exercised priorto the entitlement to the Return of Cash, the total cash returned to OrdinaryShareholders will be between £45.2 million and £46.6 million and the Companywill receive up to £2.1 million from the payment of the exercise price on theoptions. Based on the closing middle market price of 392 pence per Ordinary Share on 24August 2005 (being the latest practicable date before the publication of thisannouncement), the proposed Return of Cash equates to approximately 38 per cent.of Roxboro's market capitalisation at that date. 7. Information on the Continuing Group Overview Since 2003 the Board of Roxboro has realised in excess of £120 million fromdisposals and created a fully focused business. Following Completion, Roxboro'selectronic measurement businesses (Weston, Mobrey and Solartron) will have beendivested to US corporations, leaving Roxboro focused entirely on Dialight, itsapplied LED and solid state lighting business. Consequently, the Board considers it appropriate that The Roxboro Group PLC berenamed Dialight plc and going forward the Continuing Group will have a veryclear, focused strategy based upon applied LED technology particularly into theemerging solid state lighting sector. Dialight has operations in the UnitedStates, where currently 79 per cent. of its turnover is generated, Mexico andEurope. The Continuing Group employs approximately 900 people with the majoritylocated at two production facilities in Ensenada, Mexico. Dialight's Europeanoperations are in Munich, Germany and Newmarket, UK. The registered office is inHuntingdon, Cambridgeshire and the USA administration centre is in Farmingdale,New Jersey. A summary of the trading results of Dialight for the three years ended 31December 2004 is set out below: Year ended 31 December 2002 2003 2004 (£ million) (£ million) (£ million)Turnover 59.8 57.9 55.3Operating profit 1.0 1.1 5.9Source: Extracted, without material adjustment, from Roxboro Group statutory accounts for theyears ended 31 December 2002, 2003 and 2004 In local currency, sales growth of approximately 13 per cent. has been achievedover the period as set out below: Year ended 31 December 2002 2003 2004 (US$ million) (US$ million) (US$ million)Turnover 89.9 94.6 101.4Operating profit 1.5 1.8 10.8Source: The US$ amounts are translated at the prevailing average exchange rates of US$1.503 to £1for 2002, US$1.634 to £1 for 2003 and US$1.833 to £1 for 2004. The 2002 profits of Dialight suffered from weakness experienced in the telecomssector at that time and were also impacted by a slowdown and new competitivepressures in the conversion of road signals in the US market to solid statelighting technologies. In 2003 the profits were affected by the impact of movingDialight's operations to the low-cost facilities in Mexico where the majority ofoperations are now located. The results for 2004 reflect the turnaround in theperformance in Dialight as a result of improving end-markets and the impact ofthe cost reduction measures introduced by Roxboro. The technology LEDs have been in existence since the 1970's but it was not until the late1990's that high brightness LEDs were developed. High brightness LEDs opened upnew opportunities and progressively they are replacing conventional lightsources in many applications in which LED technology has significant advantages.LED technology, or solid state lighting as it is becoming known, absorbs only afraction of the electrical power of more conventional light sources and can lastapproximately ten times longer. There continues to be significant political and environmental pressure to reducethe demand for electrical power, thereby reducing polluting emissions. Solidstate lighting is already making significant energy savings for colouredlighting applications such as traffic signals, railway signals and obstructionlighting. As the cost of producing LED lighting reduces, further and substantialenergy savings are expected to be possible by the replacement of conventionalwhite lights. LED technology has significant advantages over conventional incandescent orhalogen lighting products that use coloured lenses. Firstly, LEDs havesignificantly greater longevity, eliminating the need for constant bulbreplacement, and secondly they consume a fraction of the power of thesetraditional light sources, thereby saving on electricity and reducing theoverall need for power production. In the context of white light, current market estimates are that LED technologywill be competitive with fluorescent light in terms of lumens per watt by 2007,being already superior to incandescent and halogen light sources on this basis.At present the cost per lumen restricts the application base of LED lighting butas the Board expects this cost to fall over the next 5 to 10 years, it expectsthat LED technology will gradually erode the market base of traditional lightsources for niche applications and will begin to take a greater share of thegeneral lighting market as it is increasingly seen as a disruptive technologywithin the lighting industry. Products and opportunities Dialight focuses on value-added applications of LED technologies rather than thedevelopment of the base technology, which is undertaken within the semiconductorindustry and is led by low-cost producers. Dialight therefore has totalflexibility in sourcing the many millions of LEDs which it purchases each year.Dialight has developed strong relationships with a few key suppliers who workwith Dialight's engineering and marketing teams, allowing the company to planahead for the introduction of new LED architectures. Dialight operates through three major product lines: • Indication;• Signalling; and• Illumination. Within Indication, Dialight has for many years been one of the world's leadingproducers of value added LED based indicator products for the electronicsindustry. Equipment used in telecommunications, networking, data transmissionand many other applications use a large number of LEDs to indicate the status ofa particular element of the equipment. The most obvious use of the LED is togive the red/green, off/on indication on any piece of electronic equipment froma television to a supercomputer. However, there are a wide variety of other LEDapplications providing channel status or other types of visual indication onservers, routers, laptops and most other electronic equipment. Dialightcustomers in this sector include Cisco, Nortel, Dell, Apple, Ericsson, Nokia andmany other OEMs. The Indication business has been the profitable foundation ofDialight over the past 15 years. The Signalling product line is a growing part of the company in which solidstate technology, in the form of high brightness devices, is applied to trafficsignals, rail signals, obstruction lighting and many other areas. Wherever red,amber, green or blue light can be seen on roadways, railways and at airports,oil refineries, construction sites and elsewhere, the Board's expectation isthat LED technology will be increasingly used in the future. In the USA, it isestimated that LED traffic signals have already achieved a 50 per cent. adoptionrate and are expected to replace conventional lamps completely within the nextfew years. Europe and Asia lag behind significantly in the adoption of LEDtraffic lights but the same fundamentals of reliability and energy saving stillapply. Railway signals and obstruction lights for broadcast/cellular towers andwind towers are following on from traffic lights. Dialight has been a pioneer inthese markets and is well placed to take advantage of the adoption of LEDtechnology in these segments. Already, a significant contract with New York CityTransit for rail wayside lights is being supplied and Dialight is supplying LEDobstruction lights and beacons to major tower operators around the world as wellas to the Federal Aviation Authority in the United States. Anywhere thatcoloured light is used for signalling is an ideal application for LEDtechnology. Illumination using solid state technology is the most recent capabilitydeveloped within Dialight and the Board believes that some of the greatestopportunities for Dialight exist within this activity. Solid state LEDtechnology is a disruptive technology that is expected to alter the lightingsector dramatically over the next decade or so. The adoption of solid state (orelectronic) lighting will be driven by the significant advantages the technologybrings, including greater efficiency, lower power consumption, greaterreliability and longer life. The technology also brings the added advantage ofproviding the possibility of infinite colour control throughout the entirecolour spectrum. This brings exciting architectural and entertainmentpossibilities, as over the next few years new buildings should begin using solidstate lighting with dynamic colour mixing technology. Theatres, cinemas, hotels,restaurants, retail outlets and studios are expected increasingly to use thisform of illumination which applies advanced developments in LED technology usingred, green and blue LEDs which in combination can produce any colour requiredincluding different shades of white. Although the energy efficiency of LEDs isgood, the cost per lumen is still too high compared to alternatives other thanfor some specialist applications. However, this is expected to change over thenext 5 to 10 years as new LED technology develops. White light produced bymixing red, green and blue LED light has the added advantage of virtuallyinfinite dynamic colour variation through digital control. It is in this areathat the early advance of solid state lighting is taking place. As a result of its experience in applied LED technology developed through itsleadership in Indication and Signalling, the Board believes that Dialight iswell placed when compared with competitors and is in an excellent position todevelop a worldwide position in these emerging markets of specialised lightingand colour mixing. It is expected that Dialight's products will increasingly be assembled at BLP'soperations in Newmarket to support growing demand in Europe. Dialight Strategy In addition to continuing to develop the existing strong market positions in theIndication and Signalling product lines, Dialight plans to exploit thedisruptive solid state lighting technologies now emerging in the Illuminationsegment. The Board will seek to develop the Illumination product line to exploitthe opportunities that exist for that business in a number of ways: • organic growth in markets - Dialight will develop its marketsorganically through investment in new product development and new customers on aglobal basis. Building on Dialight's existing strong positions in both the USAand Europe, these new products will be channelled to new and existing customers; • partnerships - these will be developed where Dialight chooses not toinvest directly. This could involve licensing Dialight's know-how and patentedtechnology to other qualified companies; and • acquisitions - Dialight will adopt a positive and proactiveacquisition policy identifying companies that can potentially be acquired togive a local footprint in key markets and bring new products into the Company. Finally, a key objective of the Continuing Group will be to improve the balanceof the activities of the Continuing Group between the USA, Europe and Asia. 8. Board composition Following the Completion of the Disposal Sir Alan Cockshaw will have chaired theBoard of Roxboro for almost eight years. Sir Alan now believes this is anappropriate time to retire as Chairman, having presided over the Board during aperiod of significant return to Shareholders, and will step down at the 2nd EGM.Following the refocusing of the Group, Roxboro founder and Chief Executive,Harry Tee, will succeed Sir Alan as Chairman. Roy Burton, who is currently CEOof Dialight Corporation, will join the Board and become Group Chief Executive ofthe re-named Dialight plc. Mr. Burton, 58, has been Chief Executive of Dialightfor the past 3 years and has led Dialight into the emerging LED illuminationmarket. He has many years experience in the electronics industry and haspreviously held positions with ITT, Amphenol, Thomas & Betts Corporation andCoraza Systems Inc. Alf Vaisey, Group Finance Director, who has played an important role in theexecution of the Group's strategy, has remained with the Group to see throughthe divestment programme. In accordance with his revised service contract Mr.Vaisey proposes to give notice to resign from the Board following completion ofthe Disposal to enable him to fulfil his desire to pursue other newopportunities. He will retire as a director following the 2nd EGM. He will besucceeded by Cathy Buckley who has been Company Secretary and Group ChiefAccountant for the past six years. Ms. Buckley will join the Board as FinanceDirector following the 2nd EGM. In his role as Chairman, Mr. Tee will initially spend approximately two days perweek working with the executive management team whom the Board believes willbenefit significantly from Mr. Tee's knowledge and experience, particularly inthe initial period following completion of the Disposal. Mr. Tee will assume anon-executive Chairman role following the next AGM in May 2006. Jeff Hewitt, who has been a non executive director for four years, will becomenon executive Deputy Chairman, whilst Robert Jeens and Bill Whiteley willcontinue as non executive directors. These board changes are conditional on the Completion of the Disposal. 9. Long term incentive arrangements The Remuneration Committee has reviewed what the appropriate long-term incentivearrangements would be for executive directors and senior managers in light ofthe proposed structure of the Continuing Group following the Disposal inconjunction with its independent advisors, Kepler Associates. The RemunerationCommittee has recommended to the Directors that a new Performance Share Plan (''New Employee Share Scheme'') be introduced following the maturity of the RoxboroShare Option Schemes. The aim of introducing the New Employee Share Scheme is to ensure that theCompany's executive incentives provide a strong link between pay andperformance, align executive and Shareholder interests, and reflect current bestpractice. It is proposed to use relative total shareholder return (''TSR'') as theperformance measure for the New Employee Share Scheme as it is considered to bean objective measure of the Company's success which will align the interests ofexecutives and Shareholders. TSR performance will be measured relative to twoindices (FTSE All-Share Electronic/Electrical Equipment Index and the FTSE SmallCap Index) to ensure the benchmark is both relevant and robust. All the OrdinaryShares would vest if the annualised TSR performance exceeds the blended index byat least 15 per cent. per annum and 20 per cent. of the shares would vest if theperformance equals the index (with pro rata vesting in between). The number ofOrdinary Shares that may be issued under the Plan in any 10-year period may notexceed such number of Ordinary Shares as represents 10 per cent. of the OrdinaryShares in issue and it is the Remuneration Committee's intention that individualawards will not normally exceed 100 per cent. of basic salary. 10. Current trading and prospects of the Continuing Group At the Annual General Meeting of Roxboro on 10 May 2005 and in the circular toShareholders dated 27 June 2005 it was reported there had been no significantchange in the markets serviced by the Group since the preliminary resultsannouncement in March 2005. This remains the case. Within Solartron, good demand has continued in the oil and gas sector with newDualstream contracts secured and there has been a steady performance atSolartron Metrology and Solartron Analytical. Dialight continues to trade in line with management's expectations and, overall,order books have strengthened from the beginning of the year. Within Indication,volumes have increased from the second half of 2004 although they have not yetrecovered to the levels achieved during the first half of 2004 when the marketwas particularly strong. Trading within Signalling is encouragingnotwithstanding delays in the receipt of regulatory approvals for Eclipse, thenew LED road signal for the European market which are now expected later thisyear. Encouraging progress has been made within the Illumination sector with anumber of new products introduced into the high end of the market. Overall, the Board views the prospects of Dialight with confidence as it pursuesits strategy focused entirely on applied LED technology and the high growthopportunities it brings, particularly in the emerging market for solid statelighting products. 11. Dividend Policy Following the Disposal of the Solartron Group and the Return of Cash to OrdinaryShareholders, the Board intends that the dividend policy adopted by Roxborogoing forward will be adjusted to reflect the new profile and growth potentialof the Continuing Group. The opportunities within the emerging solid state lighting market could lead toa period of strong investment led growth as Dialight seeks a market leadershipposition. Consequently the Board will review the on-going dividend policy takingaccount of these opportunities and the Continuing Group's achievements. 12. Circular to Shareholders The Circular containing further details on the Disposal and the proposed Returnof Cash will be posted to Shareholders shortly. DEFINITIONSThe following definitions apply throughout this announcement: "Adjustments" the adjustments to the purchase price of the Solartron Group for net cash and certain tax liabilities in the period to Completion, to be made pursuant to the Agreement; "Agreement" the sale and purchase agreement relating to the Disposal dated 25 August 2005 between Roxboro, Solartron Analytical Limited, Solartron Analytical Inc., ISA Controls Limited, Solartron Metrology Inc., the UK Purchaser and the US Purchaser; "Ametek" or "US Purchaser" Ametek, Inc.; "Articles of Association" the articles of association of Roxboro from time to time; "Analytical Transfer Documents" the agreements entered into on 6 June 2005 (as amended on 27 June 2005) and 16 June 2005 collectively effecting the transfer of the trade and assets of the Analytical Product Line out of the Mobrey Companies; "B Shares" redeemable, non-cumulative preference shares of 75p each in the capital of Roxboro; "BLP" BLP Components Limited, a subsidiary of Roxboro which supplies electromagnetic devices; "Board" or "Directors" the directors of Roxboro for the time being; "Close Brothers" Close Brothers Corporate Finance Limited; "Completion" completion of the Disposal; "Continuing Group" Roxboro and its subsidiary undertakings following Completion; "Dialight" Roxboro's solid state lighting business; "Disposal" the proposed disposal of the Solartron Group on the terms set out in the Agreement; "Emerson" Emerson Electric Company, Inc.; "1st EGM" the extraordinary general meeting of Roxboro to seek approval for the Disposal; "2nd EGM" the extraordinary general meeting of Roxboro in relation to amending Roxboro's Articles of Association, the change of name of Roxboro and the New Employee Share Scheme; "EGMs" or "Extraordinary both the 1st EGM and the 2nd EGM;General Meetings" "Illumination" Dialight's illumination product line; "Indication" Dialight's indication product line; "LED" light emitting diode; "Mobrey" the business undertaken by the Mobrey Companies prior to the Mobrey Disposal; "Mobrey Companies" Solartron Group PLC and Solartron Inc. and their respective subsidiaries which were sold by Roxboro pursuant to the Mobrey Disposal; "Mobrey Disposal" the sale by the Roxboro Group of Mobrey, a business unit of the Group's Solartron division to Emerson pursuant to a sale and purchase agreement dated 16 June 2005; "New Employee Share Scheme" the Performance Share Plan, proposed to be introduced following the maturity of the Roxboro Share Option Schemes; "Ordinary Shares" ordinary shares of 1.89 pence each in the share capital of Roxboro; "Ordinary Shareholders" the holders of Ordinary Shares; "OEM" Original Equipment Manufacturer; "Performance Share Plan" the New Employee Share Scheme; "Remuneration Committee" the remuneration committee of the Company; "Return of Cash" the return of a maximum £46.6 million of cash to Ordinary Shareholders; "Roxboro" or the "Company" The Roxboro Group PLC; "Roxboro Group" or "Group" Roxboro and its subsidiaries; "Roxboro Share Option Schemes" the Roxboro No. 1 Executive Share Option Scheme, the Roxboro No. 2or "Share Option Schemes" Executive Share Option Scheme, the Roxboro No. 3 Executive Share Option Scheme and the Roxboro Group UK Sharesave Scheme; "Shareholders" the holders of Ordinary Shares and/or B Shares as the context may require; "Signalling" Dialight's signalling product line; "Solartron" or "Solartron Group Solartron Metrology Limited and its subsidiaries and the assets and" businesses of Solartron Metrology Inc., Solartron Analytical Limited, Solartron Analytical Inc. and ISA Controls Limited; "Solartron Analytical" or " Solartron's Analytical product line, the trade and assets of whichAnalytical Product Line" were transferred out of the Mobrey Companies prior to the Mobrey Disposal into Solartron Analytical Limited and Solartron Analytical Inc. pursuant to the Analytical Transfer Documents; "Solartron ISA" Solartron's business involved in the design and supply of flow-metering products and solutions for the oil and gas market; "Solartron Metrology" Solartron's business involved in the design and supply of gauging and position measurement sensors; "UK Purchaser" EMA Holdings UK Limited, a wholly owned subsidiary of Ametek. This information is provided by RNS The company news service from the London Stock Exchange