DNK.L Regulatory News (DNK)

23 Apr 2008 13:29

Danka Business Systems PLC23 April 2008 For Immediate Release 23 April 2008 Danka Business Systems PLC ("Danka" or the "Company") Proposed Divestiture of Danka's U.S. Business Operations to Konica Minolta and Members Voluntary Liquidation Further to the announcement on 9 April 2008 that Danka had signed a definitiveagreement with Konica Minolta Business Solutions U.S.A., Inc. ("KonicaMinolta"), to acquire Danka's wholly-owned U.S. subsidiary, Danka Office ImagingCompany, and that the Board of Danka proposed placing the Company into membersvoluntary liquidation (the "Liquidation"), the Board of Danka announces that ithas entered into a deed of undertaking (the "Deed of Undertaking") with theholders of the 6.50% senior convertible participating shares of U.S. $1.00 eachin the capital of the Company (the "Participating Shares"), pursuant to whichthe holders of Danka's ordinary shares and ADSs representing Danka's ordinaryshares would be entitled to receive an aggregate cash distribution ofapproximately US$6.5 million in the Liquidation. Under the terms of Danka's Articles of Association (the "Articles"), on aliquidation of the Company the holders of the Participating Shares are currentlyentitled to receive the sum of approximately US$372 million. The Board believesthat the relevant provisions of the Articles require the entirety of the amountwhich would ultimately be available for distribution to Danka's shareholders inthe Liquidation to be paid to the holders of the Participating Shares, leavingno amount available for distribution to the holders of Danka's ordinary sharesor ADSs. However, in order to ensure that there is some return to the holders of theDanka's ordinary shares and ADSs in the Liquidation, the Board of Danka has,pursuant to the Deed of Undertaking, procured the agreement of the holders ofthe Participating Shares, notwithstanding their rights under the Articles, toirrevocably and unconditionally direct and instruct the Company's liquidators topay, out of the proceeds of the Liquidation prior to any distribution of theproceeds of the Liquidation to the holders of Participating Shares, to thepersons who hold ordinary shares and ADSs as at the time at which theLiquidation commences, an aggregate amount in cash equal to approximately US$6.5million, on the basis of a payment in cash of US$0.025 per ordinary share and apayment in cash of US$0.10 per ADS. Following this payment, any additional proceeds of the Liquidation are to bepaid to the holders of Participating Shares in accordance with the Articles andholders of ordinary shares and ADSs would not receive any further distributionsfrom the proceeds of the Liquidation. Danka shareholders should note that the disposal to Konica Minolta and theLiquidation remain conditional on shareholder approval of resolutions to beproposed at the extraordinary general meeting of the Company (the "EGM"), to beconvened in due course. The obligations of the Participating Shareholders underthe Deed of Undertaking are conditional on these resolutions being duly approvedby the requisite majorities and completion of the disposal taking place. Further details of the Deed of Undertaking and the other proposals to beconsidered by Danka's shareholders at the EGM will be set out in the shareholdercircular convening the EGM and the proxy statement, each of which will be postedto Danka shareholders as soon as possible. EnquiriesDanka: Edward Quibell, Chief Financial Officer (727) 622-2760Weber Shandwick Financial (London)James Chandler/Laura Vaughan 020 7067 0700Evolution Securities Limited (London)(Sponsor to Danka Business Systems PLC)Stuart Andrews / Bobbie Hilliam 020 7071 4300 Evolution Securities Limited ("Evolution Securities"), which is authorised inthe United Kingdom by the Financial Services Authority, is acting as Sponsor toDanka Business Systems PLC and no one else in connection with the transactionreferred to in this announcement and will not be responsible to anyone otherthan the Company for providing the protections afforded to customers ofEvolution Securities, or for advising any other person in connection with thetransaction referred to in this announcement. This announcement is not intended to and does not constitute, or form any partof, an offer to sell or an invitation to purchase any securities or thesolicitation of any vote or approval in any jurisdiction pursuant to thetransactions referred to herein or otherwise. Persons who are not resident inthe United Kingdom, or who are subject to the laws of any jurisdiction otherthan the United Kingdom, should inform themselves about, and observe anyapplicable legal and regulatory requirements. This information is provided by RNS The company news service from the London Stock Exchange