DODS.L Regulatory News (DODS)

4 Sep 2006 07:00

Huveaux PLC04 September 2006 4 September 2006 HUVEAUX PLC Acquisition of Letts and Leckie & Leckie for £12.4 million and £5.5 million Placing The Board of Huveaux PLC ("Huveaux") today announces that it has acquired theentire issued share capital of Letts Educational Limited ("Letts") and Leckie &Leckie Limited ("Leckie"), the leading providers of study aids and revisionguides in England and Scotland respectively. The businesses, which currentlyform part of Granada Learning, are being acquired from Veronis Suhler Stevensonfor a total cash consideration of £12.4 million. Letts and Leckie are highly complementary to Huveaux's successful Lonsdalerevision guide business and the acquisition therefore significantly strengthensHuveaux's existing position in the growing revision guide market. Letts andLeckie are leading retail brands across the entire curriculum from pre-school toA-level and Scottish equivalent. Lonsdale operates predominantly in secondaryschools, mainly at Key Stages 3 and 4. Huveaux will now have a comprehensiveportfolio of study guide titles and will operate in Scotland for the first time. Letts and Leckie will combine with Lonsdale to create a market-leading revisionguide business with an unrivalled product portfolio. This will comprise over 800established and new titles, in both print and online format, reflectingup-to-date curriculum changes and new Government initiatives. The combination of Letts and Leckie with Lonsdale will benefit Huveaux by: • creating a revision guides business with a range of strong brands and an enhanced product portfolio; • providing an opportunity to further exploit the growing acceptance by schools and colleges of revision and learning guides as valuable sources of course and classroom information; • delivering revenue synergies through opportunities to cross-sell Lonsdale titles into retail outlets and Letts titles into schools; • bringing access to wider educational markets in England and Scotland, particularly at higher and primary levels, as well as internationally, where the Letts brand is well established; • offering economies of scale through infrastructure, printing and administrative cost saving opportunities, as well as shared resource and content; and • enabling Huveaux to further its digital strategy of exploiting owned IP through 'in-house' developments by Epic. The Letts, Leckie and Lonsdale businesses will operate within the LearningDivision and will come under the direct control of Huveaux's Chief ExecutiveOfficer, Gerry Murray, during the integration period. A new management board,made up from existing Lonsdale, Letts and Leckie senior staff, will haveday-to-day operational responsibility. The consolidated revenues of Letts and Leckie for the financial year ended 31December 2005 were £10.0 million and the underlying consolidated operatingprofit was £1.5 million. The net assets of the combined businesses were £5.2million as at 31 December 2005. Trading at Huveaux has continued in line with expectations since the publicationof its interim results statement on 25 July 2006 and the Board remains confidentin the prospects for the current financial year. The Board expects theacquisition of Letts and Leckie to enhance Huveaux's earnings in the first fullyear of ownership. John van Kuffeler, Executive Chairman of Huveaux, commented: "The acquisition of Letts and Leckie & Leckie complements our existing Lonsdalebusiness and significantly extends our position in the rapidly growing revisionguide market. This is an excellent opportunity for Huveaux to become amarket-leading player in an attractive and growing sector." Financing The total consideration of £12.4 million is to be settled by means of a £12.2million cash payment and the satisfaction of £0.2 million debt on completion.The cash consideration is subject to a £0.4 million escrow retention against theachievement of certain operational and financial performance targets of Lettsrelating to the financial year ending 31 December 2006. Together with transaction fees and restructuring costs, the consideration willbe financed through an £8.0 million six-year Term Loan from the Bank of Scotlandand a £5.5 million Placing with institutional investors ("the Placing"). The £5.5 million Placing is being made with institutional investors by DresdnerKleinwort Securities Limited ("Dresdner Kleinwort") and Bell Lawrie (a divisionof Brewin Dolphin Securities Limited) ("Bell Lawrie") of 11,827,957 new ordinaryshares in Huveaux (the "New Ordinary Shares") at a price of 46.5 pence pershare, using the existing shareholder authority available to Huveaux underSection 89 of the Companies Act 1985. The New Ordinary Shares to be issuedrepresent approximately 8% of Huveaux's existing issued share capital. The New Ordinary Shares will be issued fully paid and will rank pari passu inall respects with the existing ordinary shares already in issue. Application has been made for the New Ordinary Shares to be admitted to tradingon the AIM market of the London Stock Exchange plc ("Admission"). Admission ofthe New Ordinary Shares is expected to take place on 7 September 2006. The Placing of New Ordinary Shares is conditional, inter alia, upon (a) theplacing agreement entered into between Dresdner Kleinwort, Bell Lawrie andHuveaux having become unconditional in all respects and not having beenterminated in accordance with its terms prior to Admission, and (b) Admission ofthe New Ordinary Shares becoming effective by 7 September 2006, or such laterdate as may be agreed. For further information, please contact: Huveaux 020 7245 0270 John van Kuffeler, Executive Chairman Gerry Murray, Chief Executive Officer Dan O'Brien, Group Finance Director Dresdner Kleinwort 020 7623 8000 Charles Batten Joe Thompson Bell Lawrie 0141 314 8108 Iain Macarthur Finsbury 020 7251 3801 James Leviton This announcement has been prepared solely to provide information about the Placing and it does not constitute, or form part of, any offer or invitation to purchase, underwrite or otherwise acquire New Ordinary Shares being offered, or the solicitation of any such offer. Without limiting the foregoing statement, this announcement does not constitute an offer of securities for sale in the United States nor the solicitation of an offer to buy any such securities, nor may securities be offered or sold in the United States absent registration or an exemption from registration as provided in the United States Securities Act of 1933, as amended (the "Securities Act"), and the rules and regulations thereunder. Huveaux does not intend to register the New Ordinary Shares under the Securities Act. This announcement does not constitute an offer to sell or issue or a solicitation of an offer to buy or subscribe for New Ordinary Shares in any jurisdiction including, without limitation, Canada, Australia, Japan or any other jurisdiction in which such offer or solicitation is or may be unlawful.This announcement and the information contained herein are not for publication or distribution, directly or indirectly, to persons in Canada, Australia or Japan unless permitted pursuant to an exemption under the relevant local law orin any jurisdiction in which such publication or distribution is unlawful. Dresdner Kleinwort Wasserstein Limited and Dresdner Bank AG, London Branch, which are authorised and regulated by the Financial Services Authority, are acting for Huveaux and for no one else in connection with the Placing and will not be responsible to anyone other than Huveaux for providing the protections afforded to the customers of Dresdner Kleinwort Wasserstein Limited and DresdnerBank AG, London Branch or for affording advice in relation to the Placing, or any other matters referred to herein. This statement should not be interpreted to mean that future earnings per share of Huveaux will necessarily be greater than those of previous periods. No representation or warranty, express or implied, is made by Dresdner Kleinwortas to any of the contents of this announcement for which the directors of Huveaux are solely responsible. This announcement contains certain forward-looking statements. Such forward-looking statements are based on currentplans, information and intentions and certain external factors which may be beyond the control of Huveaux, and therefore, undue reliance should not be placed on them. Such forward-looking statements involve unknown risks, uncertainties and other factors which may cause the actual results, financial condition, performance or achievements of Huveaux, or industry results, to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Forward-looking statements speak only as to the date on which they are made and Huveaux undertakes no obligation to update publicly any such forward-looking statementsin this announcement to reflect future events or developments. Note to Editors: • Huveaux Huveaux was formed in 2001 with the objective of building a substantial,high-quality publishing and media group. It is now twenty fold the size when itfirst listed on AIM. The Group consists of three Divisions each of which has strong brands andmarket-leading positions: Political Division comprises Dod's Parliamentary Companion, The House Magazine,Epolitix.com, Political Wizard and numerous other magazine titles andrevenue-generating websites. It is the market leader in Politicalbusiness-to-business publishing in the UK and the EU. Learning Division comprises Epic, the UK market leader in e-learning; TheTraining Journal magazine and seminar business; Lonsdale Revision Guides forschools and the highly acclaimed Westminster Explained conferences and seminars. Healthcare Division based in France, comprises Panorama du Medecin, a leadingweekly magazine for French doctors; Le Concours Medical and La Revue duPraticien, both market-leading Continuing Medical Education magazines; Egora.fr,the leading medical information website; and a number of other magazines and amedical conference business. Huveaux has now completed ten successful acquisitions over the past four yearsand employs more than 450 staff in London, Paris, Brussels and four UK regionaloffices. Further information about Huveaux can be found at www.huveauxplc.com The name Huveaux is a trademark of Huveaux PLC. All other trademarks mentionedherein are the property of Huveaux's respective subsidiary companies. All rightsreserved. • Letts Letts Educational Ltd (www.letts-successzone.com) is the leading consumerpublisher of revision guides and study workbooks aimed at national curriculumtests and public examinations (GCSE, AS and A2) in England and Wales. Topselling and key series titles include: National Test Practice Papers, TheMagical Mysteries Series and Success Guides • Leckie & Leckie Leckie & Leckie (www.leckieandleckie.co.uk) is the market-leading publisher ofrevision and course notes for Scottish Standard Grade, Intermediate and Higherexams. Leckie & Leckie is the exclusive publisher of the Scottish QualificationsAuthority's Official Past Papers. Top selling and key series titles includeRevision Notes, Revision Mind Maps and Success Guides. This information is provided by RNS The company news service from the London Stock Exchange