17 Jan 2013 14:50
Not for release, publication or distribution in whole or in part, directly or indirectly in or into or from any jurisdiction where to do so would constitute a violation of the laws of such jurisdiction.
17 January 2013
RECOMMENDED CASH OFFERbySPADILLE LIMITED ("SPADILLE")forNORTHACRE PLC ("NORTHACRE")
Summary
·; The board of Spadille and the Independent Directors are pleased to announce that they have reached agreement on the terms of a recommended cash offer, with a loan note alternative, to be made by Spadille, for the whole of the issued and to be issued ordinary share capital of Northacre not already owned by Spadille.
·; Spadille was incorporated in Jersey on 7 January 2013 for the specific purpose of making the Offer. The shares in Spadille are wholly owned by ADCM, an alternative investment company which is incorporated in the United Arab Emirates.
·; The Offer will be 96 pence in cash for each Northacre Share, valuing the existing issued ordinary share capital of Northacre at approximately £25.65 million, and represents a premium of approximately 21.5 per cent to the closing mid-market price of 79 pence of a Northacre Share on 19 December 2012, being the last Business Day prior to the commencement of the Offer Period.
·; Spadille has decided to offer an unsecured loan note alternative to the Cash Offer in the form of the Loan Notes. Northacre Shareholders must elect to accept either the Cash Offer or the Loan Note Alternative in respect of their entire holding of Northacre Shares.
·; Spadille has on 16 January 2013 acquired 7,850,000 shares in Northacre from MAR Investments Limited and it has contractually agreed to acquire a further 135,000 shares from one of the existing directors of Northacre, Mohammed AlRafi, subject to his shares being dematerialised into certificated form. Such shares represent 29.9 per cent of the total issued shares of Northacre.
·; The Independent Directors who have received advice from Ernst & Young, consider the terms of the Offer to be fair and reasonable. However, the Independent Directors do not express any view on the terms of the Loan Note Alternative. In providing such advice to the Independent Directors, Ernst & Young has relied upon the Independent Directors' commercial assessments.
PRESS ENQUIRIES
For further information contact:
Spadille | |
Mustafa Kheriba | +9712 639 0099 |
Northacre | |
Brian Harris | 020 7349 8000 |
Malcolm Williams | 020 7349 8000 |
finnCap Limited (financial adviser to Spadille) | |
Stuart Andrews | 020 7220 0500 |
Henrik Persson | 020 7220 0500 |
Ernst & Young LLP (Rule 3 adviser to Northacre) | |
Julie Green | 020 7951 2000 |
Tim Medak | 020 7951 2000 |
This summary should be read in conjunction with, and is subject to, the full text of the following announcement. Appendix 2 to this announcement contains the sources and bases of certain information used in this summary and in the following announcement. Appendix 4 to this announcement contains definitions of certain terms used in this summary and the following announcement.
Not for release, publication or distribution in whole or in part, directly or indirectly in or into or from any jurisdiction where to do so would constitute a violation of the laws of such jurisdiction.
17 January 2013
RECOMMENDED CASH OFFERbySPADILLE LIMITEDforNORTHACRE PLC
Introduction
The board of Spadille and the Independent Directors are pleased to announce that they have reached agreement on the terms of a recommended cash offer, with a loan note alternative, to be made by Spadille, for the whole of the issued and to be issued ordinary share capital of Northacre not already owned by Spadille.
The Offer will be 96 pence in cash for each Northacre Share, valuing the existing issued ordinary share capital of Northacre at approximately £25.65 million.
The Offer
The Offer, which will be subject to the conditions and principal further terms referred to in Appendix 1 of this announcement, will be made, other than to certain Overseas Shareholders, on the following basis:
For each Northacre Share | 96p in cash |
The Offer values Northacre's entire issued and to be issued share capital at approximately £25.65 million, and represents a premium of approximately 21.5 per cent to the closing mid-market price of 79 pence of a Northacre Share on 19 December 2012, being the last Business Day prior to the commencement of the Offer Period.
Northacre Shares will be acquired by Spadille pursuant to the Offer fully paid and free from all liens, equities, charges, equitable interests, encumbrances, rights of pre-emption and other third party rights and/or interest of any nature whatsoever and together with all rights attaching to them, now or in the future, including the right to receive and retain all dividends, interest and other distributions declared, paid or made in the future.
The Offer will extend, subject to the conditions and principal further terms referred to in Appendix 1 of this announcement, to any Northacre Shares unconditionally allotted or issued on the date the Offer is made and to any further Northacre Shares unconditionally allotted or issued while the Offer remains open for acceptance (or such earlier date as Spadille may, subject to the Takeover Code, decide).
The Loan Note Alternative
In addition, Northacre Shareholders will be offered a Loan Note Alternative as set out below.
Northacre Shareholders (other than certain Overseas Shareholders) who validly accept the Offer may elect, in respect of all (but not part only) of their holdings of Northacre Shares, to receive Loan Notes instead of all of the cash consideration due to them under the terms of the Offer on the following basis:
For every £1 of cash consideration under the Offer | £1 of nominal Loan Notes |
The Loan Notes, which will be governed by and construed in accordance with English law, will be issued credited as fully paid in amounts and integral multiples of £1 nominal and any fractional entitlements will be disregarded. The Loan Notes will be unsecured obligations of Spadille and will bear interest, payable upon the redemption date of the Loan Notes, at a rate of 10 per cent per annum. The Loan Notes will not be transferable. No application will be made for the Loan Notes to be listed or dealt in on any recognised stock exchange. The Loan Notes will not be available to certain Overseas Shareholders.
The Loan Notes will be redeemed, together with all accrued interest, on 17 January 2014. In addition, the Loan Notes may be redeemed in whole or in part at any time before such date, at the election of Spadille.
Elections for the Loan Note Alternative will be conditional, amongst other things, on the Offer becoming or being declared unconditional in all respects.
A summary of the principal terms of the Loan Notes is contained in Appendix 3 to this announcement, and full details will be contained in the Offer Document.
Recommendation
The Independent Directors of Northacre, who have been so advised by Ernst & Young, consider the terms of the Offer to be fair and reasonable and intend to unanimously recommend all Northacre Shareholders to accept the Offer. However, the Independent Directors do not express any view on the Loan Note Alternative. In providing advice to the Independent Directors, Ernst & Young has taken into account the Independent Directors' commercial assessment.
Information on Northacre
Northacre is engaged in property development, development management and the provision of architectural and interior design services for high quality residential property schemes, with recent such work having been focussed on attractive developments in sought-after areas of London. It has three segments, being development management, architectural design and interior design.
Information on Spadille and ADCM
Spadille
Spadille was incorporated in Jersey on 7 January 2013 for the specific purpose of making the Offer. All of the issued ordinary shares in Spadille are directly owned by ADCM, details of which are set out below.
To date, Spadille has neither traded nor engaged in any activities, other than those in relation to its incorporation, the issuing of shares to ADCM and the making of the Offer.
ADCM
ADCM is an alternative investment firm registered in the United Arab Emirates, with offices in Abu Dhabi and Dubai, serving institutions and high net worth individuals. ADCM was established in January 2011 and targets investments in various sectors and geographies. ADCM is managed, and investment decisions made, at the sole discretion of its chief executive officer, Jassim Alseddiqi.
Since its establishment, ADCM has, together with its subsidiaries, raised in excess of US$140million predominantly from institutional investors and high net worth individuals based in the Middle East and North Africa, Europe and the United Kingdom. ADCM has made several investments, including a loan facility to Northacre. ADCM has also established Qannas Investments Limited, an investment company now quoted on the AIM market of the London Stock Exchange. Abu Dhabi Capital Management Limited, a subsidiary of ADCM, is registered with the Dubai Financial Services Authority.
Acquisition of Northacre Shares
Spadille has on 16 January 2013 acquired 7,850,000 shares in Northacre from MAR Investments Limited and it has contractually agreed to acquire a further 135,000 shares from one of the existing directors of Northacre, Mohammed AlRafi, subject to his shares being dematerialised into certificated form. Such shares represent 29.9 per cent of the total issued shares of Northacre.
Background to and reasons for the Offer
During October 2011, an entity established by ADCM agreed to provide a £10.5 million loan facility to Northacre, in part to repay the outstanding bank and related party loans which Northacre had previously had in place, at a time when Northacre had been experiencing difficulties in securing financing from commercial banks or private lending sources.
Spadille considers that securing funding for development projects is currently the greatest challenge facing residential property developers such as Northacre and, in this environment, that it is those developers with access to timely funding on compelling terms that are best positioned to succeed. Since that original investment, Spadille has been impressed by the development projects that Northacre has undertaken and the capabilities of its highly skilled employees. However, Spadille believes that Northacre's financial performance and capability to develop its business pipeline have been and continue to be constrained by its ability to attract development funding.
Spadille believes its acquisition of Northacre will enhance Northacre's access to sources of development and working capital funding, and furthermore, complement this by introducing relevant contacts and projects to Northacre's businesses so as to expand their operations within the core central London focus, and in due course, potentially, internationally. Spadille believes that this strategy can best be pursued under private ownership, without the requirements of and costs associated with a public listing.
Background to and reasons for the Recommendation
Northacre has produced some of the most successful residential developments in central London and has been at the forefront of the prime market for over 20 years.
Northacre's joint venture in The Lancasters project is reaching a successful conclusion with the final returns to Northacre from the project expected to be received later this year. The other significant business of Northacre is its involvement as development manager at Vicarage Gate.
In Northacre's report and accounts for 2012 and in its recent announcements Northacre has stated that the payment of a dividend is a priority and it is the view of the Independent Directors that there is substantial appetite amongst the current shareholders for a significant realisation of shareholder value compared with a policy of retaining earnings for future projects. Furthermore as other sources of finance for working capital are not readily available the Independent Directors believe that under the new ownership structure Northacre will have greater opportunity to source further developments.
The Independent Directors believe that the Offer is at a level that recognises the value of Northacre and represents an attractive and timely opportunity for current shareholders to exit and for UK tax paying shareholders there is the additional benefit that the realisation of value will be taxed under the capital gains regime rather than as income (as would be the case if the return of value were by a dividend).
Management and Employees
ADCM and Spadille recognise and respect the capabilities and experience of the existing management and employees of Northacre. ADCM and Spadille intend to grow Northacre's business over the coming years. Accordingly, ADCM and Spadille confirm that the existing employment rights and benefits of all Northacre employees will be fully safeguarded on completion of the Offer.
Following completion of the Offer, ADCM and Spadille intend to work with Northacre's management and employees to ensure that the business is optimally structured and, while no material changes to the employee base are expected to result from this, it is possible that the review may result in minor changes to the employee base.
Confidentiality Agreement
On 28 December 2012, Northacre entered into a non-disclosure agreement ("NDA") with ADCM in relation to the Offer.
Under the NDA, ADCM agrees to keep all confidential information in respect of Northacre and the Offer secret and only use the confidential information for the purpose of considering, evaluating and negotiating the Offer. ADCM is obliged to inform Northacre if confidential information is disclosed to an unauthorised person.
ADCM is permitted to disclose confidential information to its officers, employees, professional advisers and investors, other persons as Northacre may agree in writing and to any judicial, governmental or regulatory body. Should the Offer lapse, ADCM shall return the confidential information to Northacre on request.
The NDA prevents ADCM (and any company in ADCM's group) from engaging with, or having contact with, any employees (except directors) in connection with the Offer. ADCM are also not permitted to solicit employees, clients or customers of Northacre.
ADCM's obligations under the NDA end on completion of the Offer or, if ADCM does not proceed with the Offer, on 28 December 2015.
Financing of Offer
Full acceptance of the Offer in cash will result in the payment by Spadille of approximately £18 million in cash to Northacre Shareholders. The cash consideration due under the Cash Offer will be funded by proprietary funds of ADCM made available to Spadille pursuant to an inter-company loan agreement dated 17 January 2013
finnCap, which is advising Spadille in relation to the cash confirmation pursuant to Rules 2.7(d) and 24.8 of the Code, is satisfied that resources are available to Spadille sufficient to satisfy in full the cash consideration payable under the terms of the Offer.
Dealing disclosure requirements
Under Rule 8.3(a) of the Takeover Code, any person who is interested in 1 per cent or more of any class of relevant securities of an offeree company or of any paper offeror (being any offeror other than an offeror in respect of which it has been announced that its offer is, or is likely to be, solely in cash) must make an Opening Position Disclosure following the commencement of the Offer Period and, if later, following the announcement in which any paper offeror is first identified. An Opening Position Disclosure must contain details of the person's interests and short positions in, and rights to subscribe for, any relevant securities of each of (i) the offeree company and (ii) any paper offeror(s). An Opening Position Disclosure by a person to whom Rule 8.3(a) applies must be made by no later than 3.30 pm (London time) on the 10th business day following the commencement of the Offer Period and, if appropriate, by no later than 3.30 pm (London time) on the 10th business day following the announcement in which any paper offeror is first identified. Relevant persons who deal in the relevant securities of the offeree company or of a paper offeror prior to the deadline for making an Opening Position Disclosure must instead make a Dealing Disclosure.
Under Rule 8.3(b) of the Takeover Code, any person who is, or becomes, interested in 1 per cent or more of any class of relevant securities of the offeree company or of any paper offeror must make a Dealing Disclosure if the person deals in any relevant securities of the offeree company or of any paper offeror. A Dealing Disclosure must contain details of the dealing concerned and of the person's interests and short positions in, and rights to subscribe for, any relevant securities of each of (i) the offeree company and (ii) any paper offeror, save to the extent that these details have previously been disclosed under Rule 8. A Dealing Disclosure by a person to whom Rule 8.3(b) applies must be made by no later than 3.30 pm (London time) on the business day following the date of the relevant dealing.
If two or more persons act together pursuant to an agreement or understanding, whether formal or informal, to acquire or control an interest in relevant securities of an offeree company or a paper offeror, they will be deemed to be a single person for the purpose of Rule 8.3.
Opening Position Disclosures must also be made by the offeree company and by any offeror and Dealing Disclosures must also be made by the offeree company, by any offeror and by any persons acting in concert with any of them (see Rules 8.1, 8.2 and 8.4).
Details of the offeree and offeror companies in respect of whose relevant securities Opening Position Disclosures and Dealing Disclosures can be found in the Disclosure Table on the Takeover Panel's website at www.thetakeoverpanel.org.uk, including details of the number of relevant securities in issue, when the Offer Period commenced and when any offeror was first identified. If you are in any doubt as to whether you are required to make an Opening Position Disclosure or a Dealing Disclosure, you should contact the Panel's Market Surveillance Unit on +44 (0)20 7638 0129."
Forward-looking statements
This announcement may contain "forward-looking statements" concerning the Northacre Group and the Spadille Group. Generally, the words "anticipate", "believe", "estimate", "expect", "forecast", "intend", "may", "plan", "project", "should" and similar expressions identify forward-looking statements. Such statements reflect the relevant company's current views with respect to future events and are subject to risks and uncertainties that could cause the actual results to differ materially from those expressed in the forward-looking statements. Many of these risks and uncertainties relate to factors that are beyond the companies' abilities to control or estimate precisely, such as changes in general economic and business conditions, changes in currency exchange rates and interest rates, lack of acceptance of new exchange rates and interest rates, introduction of competing products or services, lack of acceptance of new products or services, changes in business strategy and the behaviour of other market participants and therefore undue reliance should not be placed on such statements. Neither Northacre nor Spadille intends or assumes any obligation to update these forward-looking statements other than as required by law.
Cancellation of admission, compulsory acquisition of Northacre Shares and re-registration of Northacre
As soon as it is appropriate to do so, and subject to the Offer becoming or being declared unconditional in all respects and subject to any applicable requirements of the London Stock Exchange and subject to Spadille having by virtue of its shareholdings and acceptances of the Offer, acquired or agreed to acquire issued share capital carrying 75 per cent of the voting rights of Northacre, Spadille intends to procure that Northacre applies to the London Stock Exchange for the admission to trading of the Northacre Shares to be cancelled. It is anticipated that such cancellation will take effect no earlier than twenty business days after Spadille has by virtue of its shareholdings and acceptances of the Offer, acquired or agreed to acquire issued share capital carrying 75 per cent of the voting rights of Northacre. Cancellation of admission would significantly reduce the liquidity and marketability of any Northacre Shares in respect of which acceptances of the Offer are not submitted.
If sufficient acceptances are received, Spadille intends to apply the provisions of sections 979-991 (inclusive) of the Companies Act 2006 to acquire compulsorily any outstanding Northacre Shares to which the Offer relates.
It is also proposed that Northacre will be re-registered as a private company in due course.
General
The formal offer document setting out details of the Offer will be despatched to Northacre Shareholders by finnCap (on behalf of Spadille) as soon as practicable and in any event within 28 days of the date of this announcement.
This announcement does not constitute an offer or an invitation to purchase any securities.
The Offer will comply with the applicable rules and regulations of the London Stock Exchange, the Takeover Code and the AIM Rules for Companies, will be governed by English law and will be subject to the exclusive jurisdiction of the English courts. In addition, it will be on the terms and subject to the conditions set out in this announcement and in the Offer Document.
The Independent Directors accept responsibility for the information, background and reasons provided for the basis of their recommendation of the Offer. The Northacre Directors accept responsibility for all further information contained in this announcement relating to the Northacre Group, themselves and their immediate families, related trusts and connected persons. The Spadille Directors accept responsibility for all of the other information contained in this announcement. To the best of the knowledge and belief of the Independent Directors, the Northacre Directors and the Spadille Directors (who have taken all reasonable care to ensure that such is the case) the information contained in this announcement for which they are respectively responsible is in accordance with the facts and does not omit anything likely to affect the import of such information.
The Conditions and certain further terms of the Offer are set out in Appendix 1 to this announcement. Appendix 1 also sets out the sources and bases of certain financial and other information contained in this announcement. Appendix 2 contains a summary of the terms of the Loan Notes. Appendix 3 contains the definitions of certain terms used in this announcement.
finnCap has given and has not withdrawn its written consent to the issue of this announcement with the inclusion herein of the references to its name in the form and context in which they appear.
Ernst & Young has given and has not withdrawn its written consent to the issue of this announcement with the inclusion herein of the references to its name in the form and context in which they appear.
finnCap, which is regulated by the Financial Services Authority, is acting for Spadille in connection with the Offer and no-one else and will not be responsible to anyone other than Spadille for providing the protections afforded to customers of finnCap or for providing advice in relation to the Offer.
Ernst & Young, which is regulated by the Financial Services Authority, is acting for Northacre in connection with the Offer and no-one else and will not be responsible to anyone other than Northacre for providing the protections afforded to customers of Ernst & Young or for providing advice in relation to the Offer.
Please note that addresses, electronic addresses and certain other information provided by Northacre shareholders, persons with information rights and other relevant persons for the receipt of communications from Northacre may be provided to an offeror as required under the Takeover Code.
Any person who has received this announcement in electronic form or by means of a website publication may request a copy of this announcement in hard copy form and may request that all future documents, announcements and information sent to him in relation to the offer be in hard copy form. Unless so requested, a hard copy of this announcement will not be sent to you. This announcement and all future documents, announcements and information can be requested in hard copy form (free of charge), by submitting a request in writing to Northacre PLC, 8 Albion Riverside, 8 Hester Road, London SW11 4AX or by calling 020 7349 8000.
A copy of this announcement will be published on Northacre's website by 12 noon on Friday 18 January 2013. The announcement can be viewed at www.northacre.com.
Display documents
The following documents will be published on Northacre's website by 12 noon on Friday 18 January 2013:
·; the Loan Note Instrument dated 17 January 2013;
·; an intercompany loan agreement between ADCM and Spadille dated 17 January 2013; and
·; the NDA.
Overseas territories
Unless otherwise determined by Spadille and permitted by applicable law and regulation, this announcement will not be made, directly or indirectly, in or into, or by the use of the mails or by any means or instrumentality (including, without limitation, telephonically or electronically) of interstate or foreign commerce, or any facility of a national securities exchange, of a Restricted Jurisdiction (including the United States, Canada, Australia or Japan). Accordingly, copies of this announcement are not being, and must not be, directly or indirectly, mailed or otherwise forwarded, distributed or sent in or into or from a Restricted Jurisdiction and persons receiving this announcement (including, without limitation, custodians, nominees and trustees) must not mail or otherwise forward, distribute or send it in or into or from a Restricted Jurisdiction. This announcement has been prepared for the purposes of complying with English law and the Takeover Code and the information disclosed may not be the same as that which would have been disclosed if this announcement had been prepared in accordance with the laws of jurisdiction outside of England. Persons who are not resident in the United Kingdom should inform themselves about and observe any applicable requirements. If you are in any doubt about your position, you should consult your legal adviser in the relevant territory without delay.
The Loan Notes to be issued in connection with the proposed Offer have not been, nor will they be, registered under the US Securities Act or under the securities laws of any state of the United States; the relevant clearances have not been, nor will they be, obtained from the securities commission of any province or territory of Canada; no prospectus has been lodged with, or registered by, the Australian Securities and Investments Commission or the Japanese Ministry of Finance; and the Loan Notes have not been, nor will they be, registered under or offered in compliance with applicable securities laws of any state, province, territory or jurisdiction of Canada, Australia or Japan. Accordingly, the Loan Notes are not being and may not be (unless an exemption under relevant securities laws is applicable) offered, sold, resold or delivered, directly or indirectly, in or into or from the United States, Canada, Australia or Japan or any other jurisdiction if to do so would constitute a violation of the relevant laws of, or require registration thereof in, such jurisdiction or to, or for the account or benefit of, any United States, Canadian, Australian or Japanese person.
Rule 2.10 disclosure
In accordance with Rule 2.10 of the Code, Northacre announced on 20 December 2012 and confirms that it still has in issue 26,723,643 ordinary shares of 2.5 pence each all of which are admitted to trading on AIM. The ISIN of the Northacre Shares is GB0006877939.
Appendix 1
CONDITIONS AND CERTAIN FURTHER TERMS OF THE OFFER
Conditions of the Offer
Except where the context otherwise requires, references in this Appendix to:
(a) the "Offer" include any revision or extension of it; and
(b) the Offer "becoming unconditional" include references to the Offer being declared unconditional, and are to be construed as references to the Offer becoming unconditional as to acceptances whether or not any other condition of the Offer remains to be fulfilled.
1 The Offer will comply with the Takeover Code and will be subject to the following conditions.
1.1 Valid acceptances being received (and not, where permitted, withdrawn) by 3.00 pm on the first closing date of the Offer (or such later time(s) and/or date(s) as Spadille may (subject to the Takeover Code) decide) in respect of such number of Northacre Shares which, together with Northacre Shares that Spadille shall have acquired or agreed to acquire, whether pursuant to the Offer or otherwise, will result in Spadille holding Northacre Shares carrying in aggregate more than 50 per cent of the voting rights then normally exercisable at general meetings of Northacre (including for this purpose to the extent, if any, required by the Panel, any votes attributable to Northacre Shares which are unconditionally allotted or issued before the Offer becomes or is declared unconditional as to acceptances, whether pursuant to the exercise of conversion or subscription rights or otherwise).
For the purpose of this condition, Northacre Shares which have been unconditionally allotted but not issued shall be deemed to carry the votes which they will carry upon issue.
1.2 It being established in terms satisfactory to Spadille that the proposed acquisition of Northacre by Spadille, or any matters arising from it, will not be referred to the Competition Commission under the Enterprise Act 2002 and/or that it is not the intention of the European Commission, pursuant to Council Regulation (EC) 139/2004, either to initiate proceedings under article 6(1)(c) or to make a referral to a competent authority of the United Kingdom under article 9(1).
1.3 No government or governmental, quasi-governmental, supranational, statutory or regulatory body, court, trade agency, professional association or any other person or body in any jurisdiction ("Authorities") having instituted or threatened any action, proceedings, suit, enquiry or investigation or made, proposed or enacted after the date of this announcement any statute, regulation or order that would or might:
(a) make the Offer or the acquisition or proposed acquisition of any Northacre Shares illegal or otherwise restrain, prohibit, restrict or interfere in or materially delay implementation of, or impose additional conditions or obligations with respect to, or otherwise challenge the proposed acquisition of Northacre or any Northacre Shares by Spadille;(b) require or prevent the divestiture by Spadille or any of its subsidiaries (the "Spadille Group") or any of its associated companies (together the "wider Spadille Group") or by Northacre or any of its subsidiaries (the "Northacre Group") or any associated person (together the "wider Northacre Group") of all or any part of their respective businesses, assets or property or impose any limitation on the ability of any of them to conduct their respective businesses or own their respective assets or property;(c) impose any limitation on the ability of a member of the Spadille Group to acquire or hold or effectively to exercise all rights of ownership of Northacre Shares or on the ability of a member of the Northacre Group or of the Spadille Group to hold or effectively to exercise all or any rights of ownership of shares in a member of the wider Northacre Group or to exercise management control over a member of the wider Northacre Group; or(d) otherwise adversely affect the business, profits or prospects of a member of the wider Northacre Group or of the wider Spadille Group;and all applicable waiting periods during which any such Authority could institute, implement or threaten any such action, proceedings, suit, enquiry or investigation having expired or been terminated. For this purpose "associated" means a corporation of which not less than 20 per cent of the equity share capital is held, directly or indirectly, by the relevant Group and a partnership or joint venture in which a member of the relevant Group is interested, directly or indirectly.
1.4 Save as Disclosed, there being no provision of any arrangement, agreement, licence or other instrument to which a member of the wider Northacre Group is a party, or by or to which any of those members or any of their assets may be bound or be subject, which could, in consequence of the proposed acquisition of any of the Northacre Shares by Spadille or otherwise, result in:
(a) monies borrowed by or other indebtedness of any such member being or becoming repayable or capable of being declared repayable prior to their stated maturity or the ability of any such member to incur indebtedness being withdrawn or inhibited;(b) any arrangement, agreement, licence, or other instrument being terminated or adversely modified or adverse action being taken or an onerous obligation arising under it;(c) the interests or business of any member of the wider Northacre Group in or with another firm, venture, company, body or asset (or any arrangements relating to that business or interests) being terminated, modified or affected;(d) any member of the wider Northacre Group ceasing to be able to carry on business under a name under which it presently does so;(e) the creation of a mortgage, charge, security or other interest over the whole or any part of the business, property or assets of any member of the wider Northacre Group or any such security (whenever arising or having arisen) becoming enforceable; or(f) the disposal of assets or creation of liabilities by any member of the wider Northacre Group (other than in the ordinary course of business).1.5 All necessary filings having been made, all appropriate waiting periods under any applicable legislation or regulation of any territory having expired or been terminated, all necessary statutory and regulatory obligations in connection with the Offer in any jurisdiction having been complied with and all authorisations, orders, grants, recognitions, confirmations, clearances, consents, permissions and approvals necessary for or appropriate to the proposed acquisition in any jurisdiction being obtained in terms and in form satisfactory to Spadille from all appropriate Authorities or persons with whom any member of the wider Northacre Group has entered into contractual arrangements, and those authorisations, orders, grants, recognitions, confirmations, clearances, consents, permissions and approvals remaining in full force and effect and no notice of an intention to revoke or not to renew them having been received.
1.6 Other than as disclosed in the audited consolidated accounts of the Northacre Group for the year ended 29 February 2012 or the unaudited interim results of the Northacre Group for the six months period ended 31 August 2012 or otherwise Disclosed, no member of the wider Northacre Group having, since 20 December 2012:
(a) issued or authorised or proposed the issue of additional shares of any class or securities convertible into, or rights, warrants or options to acquire, any shares or other securities or redeemed, purchased or reduced any part of its share capital;(b) declared, paid or made or proposed to declare, pay or make a dividend, bonus or other distribution (whether payable in cash or otherwise) in respect of any shares in Northacre;(c) authorised or proposed or made an announcement of an intention to propose a merger or demerger or acquisition or change in its share or loan capital or, save in the ordinary course of business, a disposal of assets, creation of a mortgage or encumbrance over assets (or any right, title or interest in any assets) or issue of debentures;(d) otherwise than in the ordinary course of business incurred or increased any indebtedness or contingent liability which is material in the context of the Northacre Group taken as a whole, or entered into a material contract, arrangement, reconstruction or amalgamation;(e) purchased, redeemed or announced a proposal to purchase or redeem any of its own shares or other securities;(f) proposed a voluntary winding-up;(g) been unable, or admitted in writing that it is unable, to pay its debts or having stopped or suspended (or threatened to stop or suspend) payment of its debts generally or ceased or threatened to cease carrying on all or a substantial part of its business;(h) waived or compromised a claim which is material in the context of the relevant member of the Northacre Group;(i) disposed or transferred, mortgaged or encumbered assets or any right, title or interest in an asset or entered into a contract or commitment (whether in respect of capital expenditure or otherwise) which is of a long-term or unusual nature or which involves or could involve an obligation of a nature or magnitude which is material in the context of the Northacre Group taken as a whole;(j) entered into or varied the terms of a service or consultancy agreement with or in respect of the services of any of the directors of Northacre; or(k) entered into an agreement or commitment or passed a resolution with respect to a transaction or event referred to in this paragraph (other than those specifically excluded).1.7 Other than as disclosed in the audited consolidated accounts of the Northacre Group for the year ended 29 February 2012 or the unaudited interim results of the Northacre Group for the six months period ended 31 August 2012, since 20 December 2012 or otherwise Disclosed:
(a) there having been no receiver or administrative receiver or administrator appointed over a material part of the assets of any member of the wider Northacre Group or analogous proceedings or steps having taken place under the laws of any relevant jurisdiction and there having been no application made for the administration of, or notice of intention to appoint an administrator filed in relation to, any member of the wider Northacre Group or any equivalent proceedings or steps taken under the laws of any relevant jurisdiction;(b) there having been no material adverse change in the financial or trading position or prospects of a member of the wider Northacre Group;(c) no material litigation, arbitration proceedings, prosecution or other legal proceedings having been instituted or threatened or remaining outstanding against or by a member of the wider Northacre Group (whether as plaintiff or defendant or otherwise); and(d) no contingent liability having arisen which might be likely materially and adversely to affect a member of the wider Northacre Group.1.8 Spadille not having discovered:
(a) that the financial or business information concerning the wider Northacre Group as contained in the information publicly disclosed at any time by a member of the wider Northacre Group either contains a material misrepresentation of fact or omits a fact necessary to make the information contained in it not materially misleading or that any contingent liability disclosed in that information would or might materially and adversely affect directly or indirectly the business, profits or prospects of a member of the wider Northacre Group;(b) that a partnership or company in which a member of the wider Northacre Group has a significant economic interest and which is not a subsidiary of Northacre is subject to a material liability, contingent or otherwise, which is not disclosed in the annual report and accounts of Northacre for the financial year ended 29 February 2012; or(c) that there is a material liability (whether actual or contingent) to make good, repair, reinstate or clean-up any property now or previously owned, occupied or made use of by a past or present member of the wider Northacre Group under any environmental legislation, regulation or order of any Authority,and for the purposes of this Clause 1.8 a person shall be deemed to own or have owned property if it has or had (as the case may be) any interest in it.
Certain further terms of the Offer
2 The Offer will comply with the Takeover Code and will be governed by and construed in accordance with English law. The English courts will have exclusive jurisdiction for determining any matter which may arise under or in connection with any such contract.
3 The Northacre Shares will be acquired free from all liens, charges, equitable interests and encumbrances and third-party rights and together with all rights attaching to them, including the right to all dividends or other distributions declared, made or paid after the date of this announcement.
4 Spadille will reserve the right to waive, in whole or in part, all or any of Clause 1.2 to Clause 1.8 inclusive. Clause 1.2 to Clause 1.8 inclusive must be satisfied as at, or waived on or before, the 21st day after the later of the first closing date of the Offer and the date on which Clause 1.1 is fulfilled (or in each such case such later date as the Panel may agree). Spadille shall, however, be under no obligation to waive or treat as fulfilled any of Clause 1.2 to Clause 1.8 inclusive by a date earlier than the latest date specified above for its satisfaction notwithstanding that the other conditions of the Offer may at such earlier date have been fulfilled and that there are at such earlier date no circumstances indicating that any of such conditions may not be capable of fulfilment.
5 If Spadille is required by the Panel to make an offer or offers for Northacre Shares under the provisions of Rule 9 of the Takeover Code, Spadille may make such alterations to the conditions as are necessary to comply with the provisions of that rule.
6 The Offer will lapse if, before 3.00 pm on the first closing date or before the date when the Offer becomes or is declared unconditional as to acceptances, whichever is the later, the acquisition by Spadille of Northacre is either referred to the Competition Commission or results in the European Commission, pursuant to Council Regulation (EC) 139/2004, initiating proceedings under article 6(1)(c) or making a referral to a competent authority of the United Kingdom under article 9(1). In such circumstances, the Offer will cease to become capable of further acceptance and accepting Northacre Shareholders and Spadille shall cease to be bound by acceptances delivered on or before the date on which the Offer so lapses.
7 The availability of the Loan Note Alternative will be conditional upon the consent of the Jersey Financial Services Commission pursuant to the Control of Borrowing (Jersey) Order 1958, as amended, to the issue by Spadille of the Loan Notes and the consent of the Jersey Registrar of Companies pursuant to the Companies (General Provisions) (Jersey) Order 2002, to the circulation of the Offer Document.
Appendix 2
SOURCES OF INFORMATION AND BASES OF CALCULATIONS
In this announcement:
1 Unless otherwise stated:
(a) financial information relating to the Northacre Group has been extracted or derived (without any adjustment) from the audited consolidated accounts of the Northacre Group for the year ended 29 February 2012 or the unaudited interim results of the Northacre Group for the six month period ended 31 August 2012; and(b) the value of the Offer based on the Offer price of 96 pence per Northacre Share is calculated on the basis of the number of Northacre Shares in issue referred to in paragraph 2 below.2 As at the close of business on 19 December 2012 (being the last Business Day prior to the commencement of the Offer Period) Northacre had in issue 26,723,643 Shares. The ISIN Number for Northacre Shares is GB0006877939.
3 Unless otherwise stated, all prices and closing prices for Northacre Shares are closing quotations of a Northacre Share at the close of business on a particular trading day as derived from the Daily Official List of the London Stock Exchange published for that day.
4 The premium calculation to the price per Northacre Share have been calculated by reference to a price of 79 pence per Northacre Share being the closing mid‑market price on 19 December 2012, the Business Day immediately prior to the commencement of the Offer Period.
Appendix 3
PRINCIPAL TERMS OF THE LOAN NOTES
Loan note issuer: | To be issued by Spadille. |
Loan note maturity date and early repayment: | Repayable in full on 17 January 2014 (the "maturity date"). In addition, the issuer of the loan notes may repay the loan notes in whole or in part at any time before such maturity date. |
Loan note interest: | Interest rate of 10 per cent (ten per cent) per annum. Interest payable on the earlier of the repayment in full of the loan notes and the maturity date. |
Loan note transferability: | Not transferable. |
Security | Unsecured. |
Appendix 4
DEFINITIONS
The following definitions apply throughout this announcement unless the context requires otherwise:
"ADCM" means Abu Dhabi Capital Management LLC.
"Australia" means the commonwealth of Australia, its states, territories or possessions.
"Business Day" means any day (other than a Saturday or Sunday or a public holiday) on which banks generally are open for business in London (other than solely for settlement and trading in Euro).
"Canada" means Canada, its possessions, provinces and territories and all areas subject to its jurisdiction or any political subdivision thereof.
"Cash Offer" means the recommended cash offer to be made by Spadille to acquire all of the issued and to be issued Northacre Shares not already owned by Spadille on the terms and subject to the conditions to be set out in the Offer Document and the Form of Acceptance and, where the context so requires, any subsequent revision, variation, extension or renewal thereof.
"Dealing Disclosure" shall have the meaning as set out in Rule 8 of the Takeover Code.
"Disclosed" means disclosed by Northacre, or its advisers, to Spadille, ADCM or their advisers before the date of this announcement.
"Ernst & Young" means Ernst & Young LLP, financial adviser to Northacre.
"finnCap" means finnCap Limited, financial adviser to Spadille.
"Form of Acceptance" means the form of acceptance and authority relating to the Offer to be sent to Northacre Shareholders with the Offer Document.
"Independent Directors" means each of Brian Harris and Malcolm Williams.
"Japan" means Japan, its cities, prefectures, territories and possessions.
"Loan Note Alternative" means the alternative under the Offer whereby eligible Northacre Shareholders (other than certain Overseas Shareholders) who validly accept the Offer may elect to receive Loan Notes instead of all of the cash consideration to which they would otherwise be entitled under the Offer.
"Loan Note Instrument" means the document constituting the Loan Notes.
"Loan Notes" means the 10 per cent unsecured loan notes to be issued by Spadille pursuant to the Loan Note Alternative.
"London Stock Exchange" means London Stock Exchange plc.
"Offer" means the recommended offer to be made by Spadille to acquire all of the issued and to be issued Northacre Shares not already owned by Spadille on the terms and subject to the conditions to be set out in the Offer Document and the Form of Acceptance (including, where the context so requires, any subsequent revision, variation, extension or renewal of such offer).
"Offer Document" means the document to be sent to Northacre Shareholders containing the terms and conditions of the Offer.
"Offer Period" means the period commencing on 20 December 2012 until the latest of (i) the date falling 21 days following the date of the Offer; (ii) the date on which the Offer lapses; and (iii) the date on which the Offer becomes unconditional.
"Opening Position Disclosure" shall have the meaning as set out in Rule 8 of the Takeover Code.
"Northacre" means Northacre plc.
"Northacre Directors" means each of Klas Nilsson, Ken MacRae, Mohamed AlRafi, Brian Harris and Malcolm Williams, being all of the directors of Northacre.
"Northacre Group" means Northacre and its subsidiary undertakings.
"Northacre Shareholders" means holders of Northacre Shares.
"Northacre Shares" means the existing unconditionally allotted or issued and fully paid (or credited as fully paid) ordinary shares of 2.5 pence each in the capital of Northacre and any such further shares which are unconditionally allotted or issued fully paid while the Offer remains open for acceptance or, subject to the provisions of the Takeover Code, by such earlier date as Spadille may determine.
"Overseas Shareholders" means Northacre Shareholders who are resident in, ordinarily resident in, or citizens of, jurisdictions outside the United Kingdom.
"Panel" means the Panel on Takeovers and Mergers.
"relevant Spadille securities" means ordinary shares in the capital of Spadille, any other securities in the capital of Spadille which are equity share capital, and securities convertible into, rights to subscribe for, options (including traded options) in respect of and derivatives referenced to, any of the foregoing.
"relevant Northacre securities" means Northacre Shares, any other securities in the capital of Northacre which carry voting rights or which are equity share capital, and securities convertible into, rights to subscribe for, options (including traded options) in respect of and derivatives referenced to, any of the foregoing.
"Restricted Jurisdictions" means the United States, Canada, Australia or Japan or any other jurisdiction where extension or acceptance of the Offer would violate the law of that jurisdiction.
"short position" means a short position whether conditional or absolute and whether in the money or otherwise including any short position under a derivative, any agreement to sell or any delivery obligations or right to require another person to purchase or take delivery.
"Spadille" means Spadille Limited.
"Spadille Directors" means each of Jassim Alseddiqi and Mustafa Kheriba, being all of the directors of Spadille.
"Spadille Group" means Spadilleand its subsidiary undertakings.
"subsidiary" and "subsidiary undertaking" shall be construed in accordance with the Companies Act 2006.
"Takeover Code" means the City Code on Takeovers and Mergers.
"Treasury Share" means any share held as a treasury share as defined in section 724(5) of the Companies Act 2006.
"United Kingdom'' or "UK'' means the United Kingdom of Great Britain and Northern Ireland.
"US" or "United States" means the United States of America, its territories and possessions, any state of the United States of America and the District of Columbia and all other areas subject to its jurisdiction.
In this announcement (including in the definitions of "Northacre Shares" and "Offer"):
(a) any reference to a share or shares of Northacre being or to be "unconditionally allotted or issued" on or before a specified date, excludes:
(i) any ordinary share of 2.5 pence each held by Northacre as a Treasury Share on the date of the Offer; and
(ii) any ordinary share of 2.5 pence each held by Northacre as a Treasury Share after the date of the Offer but before the specified date,
but includes any ordinary share of 2.5 pence each that ceases or will cease to be held as a Treasury Share before the specified date; and
(b) any reference to the entire or all of the "issued and to be issued" share capital of Northacre or Northacre Shares shall be construed accordingly; and
(c) percentages of voting rights, share capital and relevant Northacre securities and relevant Spadille securities are calculated by reference to the relevant percentage held and in issue outside treasury.