Trainline Regulatory News (TRN)

11 Mar 2005 16:04

R P Martin Group Limited11 March 2005 NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION IN WHOLE OR IN PART IN OR INTO THEUNITED STATES, CANADA, AUSTRALIA OR JAPAN FOR IMMEDIATE RELEASE 11 March 2005 Recommended Cash Offer by BDO Stoy Hayward Corporate Finance on behalf of R.P. Martin Group Limited (a wholly owned subsidiary of R.P. Martin Holdings Limited) for Trio Holdings PLCSummary •The R.P. Martin Board announces that it has reached agreement with the Trio Board on the terms of a cash offer, to be made by BDO Stoy Hayward Corporate Finance on behalf of R.P. Martin, for all of the issued and to be issued Trio Shares, other than those Trio Shares which R.P. Martin has conditionally agreed to acquire pursuant to the Share Exchange Agreement. •The Offer will be made on the basis of 32 pence in cash for each Trio Share and values the Trio Shares to which the Offer relates at approximately £26.6 million. •The Offer Price represents a premium of 31 per cent. over the Closing Price of 24.5 pence per Trio Share on 21 January 2005 (being the last Business Day prior to the announcement by Trio on 24 January 2005 that it was in discussions which may or may not lead to an Offer being made for Trio) and a premium of approximately 11.3 per cent. over the Closing Price of 28.75 pence per Trio Share on 10 March 2005 (being the last Business Day prior to the announcement of the Offer). •R.P. Martin is a wholly owned subsidiary of R.P. Martin Holdings, which is currently controlled by David Caplin. Each of R.P. Martin and R.P Martin Holdings is a recently incorporated company that has been formed for the purpose of making the Offer. •The R.P. Martin Group is backed by Management (comprising David Caplin, Alan Farnan and Jeremy Kraft) and Gresham. •The Offer will be unanimously recommended by the Trio Board. •R.P. Martin has received irrevocable undertakings to accept, or procure the acceptance of, the Offer, a letter of intent to accept the Offer and an agreement to sell Trio Shares in respect of, in aggregate, 42,935,408 Trio Shares representing approximately 51.4 per cent. of the current issued Trio Shares. •It is expected that the Offer Document will be despatched to Trio Shareholders later today. Commenting on the Offer, David Hagan (Executive Chairman of Trio) said: "The Board of Trio is very pleased to recommend this offer to shareholders at aprice level that reflects full recognition of the value of the very longestablished franchise of our underlying operating businesses.R.P. Martin's future 'private equity' structure, and associated operatingmanagement involvement, provides an environment for continuity of the TrioGroup's niche areas of excellence, and the opportunity for it to grow, develop,and face the future with confidence: we wish them every continuing success." David Caplin, director of R.P. Martin commented: "We are delighted to have reached agreement with Trio on this deal to take thecompany private. As well as providing value for existing shareholders, webelieve the increased independence of the company achieved through the buyoutwill create opportunities for us to enhance our position in the market place, tobuild upon our strong client relationships and, at the same time, to reinforcethe commitment of our talented team of brokers and back office staff."This summary should be read in conjunction with the full text of the followingannouncement. Certain terms used in this summary are defined in Appendix II ofthis announcement. For further information contact: R.P. Martin Holdings Limited 020 7469 9000David Caplin, Chief Executive Officer BDO Stoy Hayward Corporate Finance 020 7486 5888Alex WhiteShaun Claydon Trio Holdings PLC 020 7469 9100David Hagan Deloitte Corporate Finance 020 7936 3000Jonathan HintonDavid Kent Chantry Corporate Finance 01483 230 334David Blake This announcement has been approved for the purposes of Section 21 of theFinancial Services and Markets Act 2000 by BDO Stoy Hayward Corporate Finance. BDO Stoy Hayward Corporate Finance, a division of BDO Stoy Hayward LLP,Chartered Accountants, which is authorised and regulated in the UK by the FSA,is acting for the R.P. Martin Group and no one else in connection with the Offerand will not be responsible to anyone other than the R.P. Martin Group forproviding the protections afforded to customers of BDO Stoy Hayward CorporateFinance nor for providing advice in relation to the Offer. Deloitte Corporate Finance is acting for Trio and no-one else in connection withthe Offer and will not regard any other person as its client or be responsibleto anyone other than Trio for providing the protections afforded to clients ofDeloitte Corporate Finance or for providing advice in relation to the Offer orany matter referred to herein. Deloitte Corporate Finance is a division ofDeloitte & Touche LLP, which is authorised and regulated by the FSA in respectof regulated activities. Chantry Corporate Finance, which is authorised and regulated by the FSA, isacting for the Directors of R P. Martin and for no one else in connection withthe Offer and will not be responsible to anyone other than the Directors of R P.Martin for providing the protections afforded to customers of Chantry CorporateFinance nor for providing advice in relation to the Offer. The Offer will not be made, directly or indirectly, in or into the UnitedStates, Canada, Australia or Japan, or by the use of the mails, or by any meansor instrumentality (including, without limitation, telephonically orelectronically) of interstate or foreign commerce, or by any facility of anational securities exchange of the United States, Canada, Australia or Japan,and the Offer will not be capable of acceptance by any such uses, means,instrumentality or facility from or within the United States, Canada, Australiaor Japan. The availability of the Offer to persons not resident in the UK may be affectedby the laws of the relevant jurisdiction. Such persons should inform themselvesabout and observe any applicable legal or regulatory requirements. The R.P. Martin Directors (being also the R.P. Martin Holdings Directors) acceptresponsibility for the information contained in this announcement, other thanthat relating to the recommendation of the Offer by the Trio Directors and theirassociated opinions, and the information relating to the Trio Group, the TrioDirectors and members of their immediate families, related trusts and personsconnected with them and to Gresham. To the best of the knowledge and belief ofthe R.P. Martin Directors (who have taken all reasonable care to ensure this isthe case), the information contained in this announcement for which they acceptresponsibility is in accordance with the facts and does not omit anything likelyto affect the import of such information. The Trio Directors accept responsibility for all the information contained inthis announcement relating to the recommendation of the Offer by the TrioDirectors including their views, opinions and recommendations and theinformation relating to the Trio Group, the Trio Directors and members of theirimmediate families, related trusts and persons connected with them. To the bestof the knowledge and belief of the Trio Directors (who have taken all reasonablecare to ensure this is the case), the information contained in this announcementfor which they accept responsibility is in accordance with the facts and doesnot omit anything likely to affect the import of such information. The members of the Investment Committee of Gresham accept responsibility for theinformation contained in this announcement, other than that relating to therecommendation of the Offer by the Trio Directors and their associated opinions,and the information relating to the Trio Group, the Trio Directors and membersof their immediate families, related trusts and persons connected with them. Tothe best of the knowledge and belief of the Investment Committee of Gresham (whohave taken all reasonable care to ensure this is the case), the informationcontained in this announcement for which they accept responsibility is inaccordance with the facts and does not omit anything likely to affect the importof such information. This announcement does not constitute, or form part of, an offer or invitationto purchase securities. NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION IN WHOLE OR IN PART IN OR INTO THEUNITED STATES, CANADA, AUSTRALIA OR JAPAN. FOR IMMEDIATE RELEASE 11 March 2005 Recommended Cash Offer by BDO Stoy Hayward Corporate Finance on behalf of R.P. Martin Group Limited (a wholly owned subsidiary of R.P. Martin Holdings Limited) for Trio Holdings PLC 1. Introduction The R.P. Martin Board is pleased to announce that it has reached agreement withthe Trio Board on the terms of a recommended cash offer, to be made by BDO StoyHayward Corporate Finance on behalf of R.P. Martin, for all of the issued and tobe issued Trio Shares, other than those Trio Shares which R.P. Martin hasconditionally agreed to acquire pursuant to the Share Exchange Agreement. R.P. Martin is a private limited company recently incorporated in England andWales which was formed for the purpose of making the Offer and has not tradedsince incorporation. R.P. Martin is a wholly owned subsidiary of R.P. MartinHoldings, which is currently controlled by David Caplin. Following the Offerbecoming, or being declared, unconditional in all respects, it is expected thatR.P. Martin Holdings will be owned as to 60.3 per cent. by Gresham Funds, 38.4per cent. by Management and 1.3 per cent. by David Callear. The Trio Directors, who have been so advised by Deloitte Corporate Finance,consider the terms of the Offer to be fair and reasonable. In providing adviceto the Trio Directors, Deloitte Corporate Finance has taken account of thecommercial assessments of the Trio Directors. Accordingly, the Trio Directors will unanimously recommend Trio Shareholders toaccept the Offer as they have irrevocably undertaken to do, and to procure thatcertain members of their immediate families will do, in respect of the whole oftheir beneficial holdings of Trio Shares amounting, in aggregate, to 9,204,422Trio Shares (representing approximately 11.0 per cent. of the current issuedTrio Shares). 2. Terms of the Offer The Offer will be subject to the terms and conditions set out or referred to inAppendix I to this announcement and the further terms and conditions to be setout in the Offer Document and, in the case of certificated Trio Shares, the Formof Acceptance. The Offer is being made on the following basis: for each Trio Share 32 pence in cash The Offer values the Trio Shares to which the Offer relates at approximately£26.6 million and represents a premium of approximately: €31 per cent. over the Closing Price of 24.5 pence per Trio Share on 21 January 2005, being the last Business Day prior to the announcement by Trio on 24 January 2005 that it was in discussions which may or may not lead to an offer being made for Trio; €11 per cent. over the Closing Price of 28.75 pence per Trio Share on 10 March 2005, being the last Business Day before the announcement of the Offer; and €38 per cent. over the Closing Price of 23.25 pence per Trio Share on 8 December 2004 being the 30th Business Day prior to the announcement by Trio on 24 January 2005 that it was in discussions which may or may not lead to an offer being made for Trio. 3. Background to and reasons for the Offer The money, securities and derivatives broking sector in which the Trio Groupoperates has seen a significant amount of corporate activity and consolidationtaking place over the past two years, driven principally by consolidation in itscustomer base which includes some of the world's largest banks and also by thecontinuing growth of competing electronic transactional systems in its productmarkets. The Trio Directors have received a number of approaches from, and have made anumber of approaches to, potential purchasers over the last two years. Whilstseveral of these have led to early stage discussions, none resulted in a viableopportunity to achieve further enhancement of shareholder value. Against this background, in September 2004, David Caplin and Alan Farnan, seniormanagers of Martin Brokers (UK) plc (the principal operating subsidiary of theTrio Group), backed by Gresham, approached the Trio Directors with a potentialcash offer of 32 pence per Trio Share. At this price the Trio Board decided thatthe potential offer was sufficiently attractive to enter into the formaldiscussions which have culminated in the Offer. In considering whether the Offer is fair and reasonable to Trio Shareholders,the Trio Directors have considered the immediate and certain benefits of theOffer against the potential future return to be gained from remaining as TrioShareholders. The inherent and very substantial cost burden of being a publicly listed companyweighs heavily in a business of the size and scale of Trio. Further,inter-professional money, securities and derivatives broking is a serviceindustry, where there is a disincentive to invest in organic growth as theassociated costs have an adverse impact on the profit and loss account duringthe often protracted establishment period for new products and geographicservice lines. Whilst Trio has consistently maintained a strong balance sheet and cash reservesfor some years, the Trio Directors have long believed that some structuralchange would be inevitable to maintain longer term viability of the underlyingbusinesses as a result of the consolidation taking place in the sector. TheOffer, which provides the opportunity to remove the costs associated with beinga publicly listed company and provides Trio with the opportunity to usealternative incentive structures for Management and the employees of the TrioGroup, together with the cash resources available to R.P. Martin Holdings goingforward, represents such a structural change at an appropriate level of valuefor Trio Shareholders. The Offer will enable Trio Shareholders to realise their investment in Triowithout incurring dealing costs, at a price that represents a 31 per cent.premium over the Closing Price of 24.5 pence on 21 January 2005, being the lastBusiness Day prior to the announcement by Trio on 24 January 2005 that it was intalks which may or may not lead to an offer being made for Trio. In view of these factors (in particular the premium described above) and givenprevious discussions held with other parties, the Trio Directors have concludedthat the Offer represents fair value for Trio and therefore that the Offer is inthe interests of Trio Shareholders. The R.P. Martin Board believes that, unencumbered by the costs of a publiclisting and the need for short-term stock market outperformance, R.P. Martinwill be better able to develop and grow the long-term underlying business of theR.P. Martin Group. Save in respect of the closure of Trio's Swiss operation, it is the currentintention of the R.P. Martin Board to continue the business of the Trio Group inthe manner in which it exists at the date of the Offer. 4. Irrevocable undertakings and letter of intent to accept the Offer R.P. Martin has received irrevocable undertakings to accept, or procure theacceptance of, the Offer from all of those Trio Directors who hold Trio Sharesin respect of the whole of their beneficial holdings of Trio Shares and theholdings of certain members of their immediate families. These irrevocableundertakings are in respect of, in aggregate, 9,204,422 Trio Shares,representing approximately 11.0 per cent. of the current issued Trio Shares.These irrevocable undertakings will remain binding in the event of a higheroffer being made for Trio, but will cease to be binding in the event that theOffer lapses or is withdrawn. R.P. Martin has also received an irrevocable undertaking from Nittan to accept,or procure the acceptance of, the Offer in respect of a further 24,961,824 TrioShares, representing approximately 29.9 per cent. of the current issued TrioShares. This irrevocable undertaking will remain binding in the event of ahigher offer being made for Trio, but will cease to be binding in the event thatthe Offer lapses or is withdrawn. R.P. Martin has also received a non-binding letter of intent from Fidelity, aninstitutional Trio Shareholder, to accept the Offer in respect of a further8,319,162 Trio Shares, representing approximately 10.0 per cent. of the currentissued Trio Shares. In addition, pursuant to the Share Exchange Agreement (completion of which isconditional, inter alia, on the Offer becoming, or being declared, unconditionalin all respects), David Caplin has agreed to sell, and R.P. Martin has agreed toacquire, 450,000 Trio Shares in aggregate representing 0.5 per cent. of thecurrent issued Trio Shares. Accordingly, R.P. Martin has received irrevocable undertakings, to accept, orprocure the acceptance of, the Offer, a letter of intent to accept the Offer andan agreement to sell Trio Shares in respect of, in aggregate, 42,935,408 TrioShares representing, in aggregate, approximately 51.4 per cent. of the currentissued Trio Shares. 5. Information on the R.P. Martin Group Each of R.P. Martin and R.P. Martin Holdings is a private limited companyrecently incorporated in England and Wales that has been established for thepurpose of making the Offer. They have not traded since incorporation norentered into any obligations other than in connection with the Offer and thefinancing thereof. The sole shareholder of R.P. Martin is R.P. Martin Holdings.R.P. Martin Holdings is currently owned by David Caplin. The R.P. MartinHoldings and R.P. Martin Boards currently comprise David Caplin, Alan Farnan andJeremy Kraft. Under the terms of the New Articles of Association, the GreshamFunds, which will invest in R.P. Martin Holdings, will have the right to appointone or more directors to the R.P. Martin Holdings Board upon the Offer becoming,or being declared, unconditional in all respects. Subject to the Offer becoming, or being, declared, unconditional in allrespects, the Investors have agreed pursuant to the Investment Agreement tosubscribe a total of £736,000 in cash for R.P Martin Holdings A Shares. TheGresham Funds will also subscribe for deep discount bonds in R.P Martin Holdingsupon completion of the Investment Agreement. In addition, David Caplin has agreed, subject to, inter alia, the Offerbecoming, or being declared, unconditional in all respects, to exchange hisentire holding of Trio Shares for R.P. Martin Loan Notes pursuant to the ShareExchange Agreement. The Share Exchange Agreement also contains put and callarrangements whereby, subject to the Offer becoming, or being declared,unconditional in all respects, and David Caplin exchanging his entire holding ofTrio Shares for R.P. Martin Loan Notes, R.P. Martin Holdings can exercise aright to buy, and David Caplin can exercise a right to sell, all of the R.P.Martin Loan Notes. In exchange, David Caplin will receive R.P. Martin Holdings BShares. David Caplin can exercise his right to sell the R.P. Martin Loan Notesto R.P. Martin Holdings at any time after the R.P. Martin Loan Notes have beenissued to him. R.P. Martin Holdings can exercise its right to buy the R.P.Martin Loan Notes from David Caplin at any time following seven days after theR.P. Martin Loan Notes have been issued to David Caplin. The exchange of theR.P. Martin Loan Notes by David Caplin for R.P. Martin Holdings C Shares will beeffected shortly after the Offer becomes, or is declared, unconditional in allrespects. Further information on R.P. Martin and R.P. Martin Holdings will be set out inthe Offer Document. 6. Information on the Investors a. Management Set out below are the names of the current R.P. Martin Directors and R.P. Martin Holdings Directors who will invest directly in R.P. Martin Holdings: Anticipated Position in Management Position in Trio R.P. Martin Holdings David Caplin Managing Director, Chief Executive Officer Martin Brokers (UK) plc Alan Farnan Marketing Director, Marketing Director Martin Brokers (UK) plc Jeremy Kraft No current role Finance Director Further information on the arrangements with Management will be set out in the Offer Document. b. Gresham Gresham is a UK based private equity house specialising in investing in mid-market companies. Transactions are typically valued at between £5 million and £75 million. The group focuses primarily on management buy-outs and invests in a broad range of businesses. The group has built particular expertise in certain sectors including business/support services, consumer, pharmaceutical/healthcare, financial services and industrial products. Recent investments include PIMS Services Limited, Flowtech Limited and Minivator Limited. Gresham's offices in London, Birmingham and Manchester give direct access to the key centres of UK buyout activity. A focused portfolio management team works alongside investee companies in dealing with key commercial and financial aspects of the business to enhance the value of an investment. Gresham is an independent business which is wholly owned by its management team. In 2004, Gresham announced it had raised £235 million in the Gresham Funds, exceeding its target of £200 million. Eighteen investors have committed funds to the Gresham Funds including pension funds, fund of funds, banks and insurers from the UK, continental Europe, Asia and the United States. c. R.P. Martin Holdings C Shareholders It is intended that 24,275,000 R.P. Martin Holdings C Shares will be issued by R.P. Martin Holdings to certain non-management employees of Trio at a time to be decided by Management after the Offer has become, or been declared, unconditional in all respects. The identities of those employees who will be offered R.P. Martin Holdings C Shares and the number of such shares for which they will be offered will be agreed between Management and Gresham. 7. Information on the Trio Group Trio is a public limited company incorporated in England and Wales whose sharesare listed on the Official List and are admitted to trading on the main marketfor listed securities of the London Stock Exchange. Its principal activity is asa market leading niche wholesale money broking company principally acting as aninter-dealer broker, trading as Martin Brokers, in the over the counter ("OTC")markets for products related to: • Forward Foreign Exchange;• Money markets;• Derivatives (including equity derivatives); and• Fixed income. In the financial period ended 30 September 2004, the Trio Group reportedturnover from continuing activities of £32.4 million and achieved profit aftertax of £0.18 million. As at that date, the Trio Group had net consolidatedassets of £11.2 million and cash of £10.3 million. Further information on theTrio Group will be included in the Offer Document. 8. Current trading and prospects As indicated in the Trio chairman's statement on 30 November 2004 accompanyingthe preliminary announcement of results for the year to 30 September 2004,trading had returned to more normal levels. This remains the position, andcurrent trading is satisfactory and in line with the expectations of the TrioBoard. There has been and remains volatility in global foreign exchange markets, whichhas in particular benefited Trio's key forward foreign exchange broking teams,forming together a division of specialisation and traditional excellence withinTrio. A recent notable achievement was the completion of the fourth year of tradingthrough Trio's voice-assisted electronic transactional system for the localauthority market (www.UK-Locals.com). Trading through the system showed a 60 percent. increase over the previous year, with 11,944 trades in total at its fourthanniversary and the pace at which the local authority treasury market hasembraced this new technology has exceeded the Trio Directors' expectations. Theprospects for this division of the business remain encouraging. Similar technology will shortly be beta-tested in the high volume sterling shortdate deposits market through the introduction of Trio's 'Focus' electronictransactional system. Constructive discussions during this system's development,with the leading banks in this area of the market, have given the Trio Directorsoptimism for success. However, the continuing endeavour to establish a viable operation in Switzerlandhas been especially onerous, as indicated in previous statements. Accordingly,Trio's Swiss operation is in the process of being closed and the future strategyfor this area is under review. Since 30 September 2004, in addition to the costs associated with the ongoingprocess of closing the Swiss operation of the Trio Group, Trio has incurredcosts outside the normal course of business in connection with progressing theOffer and settling litigation in connection with the departure of certainemployees from the Trio Group. Therefore, the encouraging trends in marketactivity outlined above have been tempered by these specific issues andassociated costs. 9. Trio management and employees The Board of R.P. Martin has given assurances to the Trio Directors that,following the Offer becoming, or being declared, unconditional in all respects,the existing employment rights, including pension rights, of all employees ofthe Trio Group will be fully safeguarded. The Trio Directors have agreed to resign from the Trio Board upon the Offerbecoming, or being declared, unconditional in all respects. 10. Compulsory acquisition, de-listing, cancellation of trading andre-registration If R.P. Martin receives acceptances under the Offer in respect of, or otherwiseacquires, 90 per cent. or more of the Trio Shares to which the Offer relates,R.P. Martin intends to exercise its rights pursuant to the provisions ofsections 428 to 430F (inclusive) of the Act to acquire compulsorily theremaining Trio Shares to which the Offer relates. R.P. Martin has stated that as soon as it is appropriate and possible to do so,and subject to the Offer becoming, or being declared, unconditional in allrespects, it intends to procure the making of an application by Trio to the UKLAfor the cancellation of the listing of Trio Shares on the Official List and tothe London Stock Exchange for the cancellation of admission to trading of TrioShares on its main market for listed securities. It is anticipated that suchcancellations will take effect no earlier than 20 Business Days after the Offerbecoming, or being declared, unconditional in all respects. De-listing isexpected to reduce significantly the liquidity and marketability of any TrioShares not acquired under the Offer. It is also proposed that, following the Offer becoming, or being declared,unconditional in all respects and after the Trio Shares are de-listed, Trio willbe re-registered as a private limited company under the relevant provisions ofthe Act. 11. Inducement fee Trio has entered into an agreement with Gresham and Management as an inducementto R.P. Martin making the Offer, under which Trio has agreed to make a paymentto R.P. Martin of £267,150 (inclusive of VAT) in the event, inter alia, that theOffer fails to become, or be declared, unconditional in all respects because theTrio Directors or their financial advisers alter or withdraw theirrecommendation of the Offer or if an independent competing offer for Trio ismade and becomes, or is declared, unconditional in all respects. The Trio Directors are satisfied that entering into this inducement feeagreement has enabled the Offer to be made on the current terms and that it isin the best interests of Trio Shareholders for the Offer to be made.Accordingly, the Trio Directors and Deloitte Corporate Finance consider theinducement fee agreement to be in the best interests of Trio Shareholders. 12. Financing of the Offer Full acceptance of the Offer would require a maximum cash payment ofapproximately £26.6 million by R.P. Martin, which will be funded out of R.P.Martin's resources made available by the Investors, further details of whichwill be set out in the Offer Document. For further information contact: R.P. Martin Holdings Limited 020 7469 9000David Caplin, Chief Executive Officer BDO Stoy Hayward Corporate Finance 020 7486 5888Alex WhiteShaun Claydon Trio Holdings PLC 020 7469 9100David Hagan Deloitte Corporate Finance 020 7936 3000Jonathan HintonDavid Kent Chantry Corporate Finance 01483 230 334David Blake This announcement has been approved for the purposes of Section 21 of theFinancial Services and Markets Act 2000 by BDO Stoy Hayward Corporate Finance. BDO Stoy Hayward Corporate Finance, a division of BDO Stoy Hayward LLP,Chartered Accountants, which is authorised and regulated in the UK by the FSA,is acting for the R.P. Martin Group and no one else in connection with the Offerand will not be responsible to anyone other than the R.P. Martin Group forproviding the protections afforded to customers of BDO Stoy Hayward CorporateFinance nor for providing advice in relation to the Offer. Deloitte Corporate Finance is acting for Trio and no-one else in connection withthe Offer and will not regard any other person as its client or be responsibleto anyone other than Trio for providing the protections afforded to clients ofDeloitte Corporate Finance or for providing advice in relation to the Offer orany matter referred to herein. Deloitte Corporate Finance is a division ofDeloitte & Touche LLP, which is authorised and regulated by the FSA in respectof regulated activities. Chantry Corporate Finance, which is authorised and regulated by the FSA, isacting for the Directors of R P. Martin and for no one else in connection withthe Offer and will not be responsible to anyone other than the Directors of R P.Martin for providing the protections afforded to customers of Chantry CorporateFinance nor for providing advice in relation to the Offer. The Offer will not be made, directly or indirectly, in or into the UnitedStates, Canada, Australia or Japan, or by the use of the mails, or by any meansor instrumentality (including, without limitation, telephonically orelectronically) of interstate or foreign commerce, or by any facility of anational securities exchange of the United States, Canada, Australia or Japan,and the Offer will not be capable of acceptance by any such uses, means,instrumentality or facility from or within the United States, Canada, Australiaor Japan. The availability of the Offer to persons not resident in the UK may be affectedby the laws of the relevant jurisdiction. Such persons should inform themselvesabout and observe any applicable legal or regulatory requirements. The R.P. Martin Directors (being also the R.P. Martin Holdings Directors) acceptresponsibility for the information contained in this announcement, other thanthat relating to the recommendation of the Offer by the Trio Directors and theirassociated opinions, and the information relating to the Trio Group, the TrioDirectors and members of their immediate families, related trusts and personsconnected with them and to Gresham. To the best of the knowledge and belief ofthe R.P. Martin Directors (who have taken all reasonable care to ensure this isthe case), the information contained in this announcement for which they acceptresponsibility is in accordance with the facts and does not omit anything likelyto affect the import of such information. The Trio Directors accept responsibility for all the information contained inthis announcement relating to the recommendation of the Offer by the TrioDirectors including their views, opinions and recommendations and theinformation relating to the Trio Group, the Trio Directors and members of theirimmediate families, related trusts and persons connected with them. To the bestof the knowledge and belief of the Trio Directors (who have taken all reasonablecare to ensure this is the case), the information contained in this announcementfor which they accept responsibility is in accordance with the facts and doesnot omit anything likely to affect the import of such information. The members of the Investment Committee of Gresham accept responsibility for theinformation contained in this announcement, other than that relating to therecommendation of the Offer by the Trio Directors and their associated opinions,and the information relating to the Trio Group, the Trio Directors and membersof their immediate families, related trusts and persons connected with them. Tothe best of the knowledge and belief of the Investment Committee of Gresham (whohave taken all reasonable care to ensure this is the case), the informationcontained in this announcement for which they accept responsibility is inaccordance with the facts and does not omit anything likely to affect the importof such information. This announcement does not constitute, or form part of, an offer or invitationto purchase securities. APPENDIX I CONDITIONS OF THE OFFER 1.The Offer will be subject to the following conditions: (a)valid acceptances being received (and not, where permitted, withdrawn) by not later than 1.00 p.m. on 1 April 2005, the first closing date of the Offer (or such later time(s) and/or date(s) as R.P. Martin may, subject to the rules of the Code, decide) in respect of not less than 90 per cent. (or such lesser percentage as R.P. Martin may decide) in nominal value of the Trio Shares to which the Offer relates, provided that, unless agreed by the Panel, this condition will not be satisfied unless R.P. Martin, or any of its wholly-owned subsidiaries, shall have acquired or agreed to acquire (pursuant to the Offer or otherwise), directly or indirectly, Trio Shares carrying, in aggregate, over 50 per cent. of the voting rights then normally exercisable at general meetings of Trio (including for this purpose, to the extent (if any) required by the Panel, any such voting rights attributable to any Trio Shares that 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); and for this purpose, (i) the expression "Trio Shares to which the Offer relates" shall be construed in accordance with sections 428 to 430F inclusive of the Act; and (ii) Trio Shares which have been unconditionally allotted but not issued shall be deemed to carry the voting rights which they will carry on issue; (b)no government, government department, or governmental, quasi-governmental, supranational, statutory or regulatory body, or any court, institution, investigative body, association, trade agency or professional or environmental body or (without prejudice to the generality of the foregoing) any other person or body in any jurisdiction (each, a "Relevant Authority") having decided to take, instituted, implemented or threatened any action, proceedings, suit, investigation, reference or enquiry or enacted, made or proposed any statute, regulation or order or otherwise taken any other step or done any thing, and there not being outstanding any statute, legislation or order, that would or might: i. restrict, restrain, prohibit, delay, impose additional conditions or otherwise challenge or require the amendment of obligations with respect to, or otherwise interfere with the implementation of, the Offer or the acquisition of any Trio Shares by R.P. Martin or the control of Trio by R.P. Martin or any matters arising therefrom; ii. require, prevent, delay or affect the divestiture by R.P. Martin or Trio or any of Trio's subsidiaries, subsidiary undertakings or associated undertakings (including any company of which 20 per cent. or more of the voting capital is held by the Trio or any partnership, joint venture, firm or company in which any of them may be interested) (together the "wider Trio Group") of all or any portion of their businesses, assets or property or of any Trio Shares or other securities (or the equivalent) in Trio or impose any limitation on the ability of any of them to conduct their respective businesses or own their respective assets or properties or any part thereof to an extent which is material in the context of the Offer on the wider Trio Group taken as a whole, or as the case may be, R.P. Martin; iii.impose any limitation on, or result in a material delay in, the ability of R.P. Martin or any member of the wider Trio Group to acquire, hold or exercise effectively, directly or indirectly, all or any rights of ownership in respect of shares or other securities (or the equivalent) in, or to exercise management control over, any member of the wider Trio Group; iv. save pursuant to the Offer or Part XIIIA of the Act or the Code , require R.P. Martin or any member of the wider Trio Group to offer to acquire any shares or other securities (or the equivalent) or rights thereover, or any material asset of R.P. Martin or any member of the wider Trio Group owned by any third party or to sell or offer to sell any shares or other securities (or the equivalent) or rights thereover, or any material asset owned by R.P. Martin or any member of the wider Trio Group; v. make the Offer or its implementation or the acquisition or proposed acquisition if Trio or any member of the wider Trio Group or of any Trio Shares or any other shares or securities in, or control of, Trio by R.P. Martin, illegal, void and/or unenforceable in or under the laws of any jurisdiction; vi. impose any material limitation on the ability of R.P. Martin or any member of the wider Trio Group to integrate or co-ordinate its business, or any part of it, with all or any material part of the business of R.P. Martin or any member of the wider Trio Group; vii.result in a delay in the ability of R.P. Martin, or render R.P. Martin unable, to acquire some or all of the Trio Shares or require or prevent or delay the divestiture by R.P. Martin of any such shares or other securities of Trio; viii.result in any member of the wider Trio Group ceasing to be able to carry on its business under any name which it at present uses; or ix. otherwise adversely affect any or all of the businesses, assets, prospects or profits of R.P. Martin or any member of the wider Trio Group to an extent which is material in the context respectively of R.P. Martin or the relevant member of the wider Trio Group, and all applicable waiting and other time periods during which such RelevantAuthority could decide to institute, implement or threaten any such action,proceeding, suit, investigation, enquiry or reference or otherwise intervenehaving expired, lapsed or been terminated; (c) all authorisations, orders, grants, recognitions, confirmations, certificates, consents, clearances, licences, permissions, exemptions and approvals, in any jurisdiction, for or in respect of the Offer, the proposed acquisition of any shares or securities in, or control of, Trio or any member of the wider Trio Group by R.P. Martin or the carrying on of the business of any member of the wider Trio Group or R.P. Martin or any matters arising therefrom (including, for the avoidance of doubt, the approval of the FSA under section 184 of the Financial Services and Markets Act 2000) being obtained in terms satisfactory to R.P. Martin from all appropriate Relevant Authorities or (without prejudice to the generality of the foregoing) from any persons or bodies with whom any members of the wider Trio Group or R.P. Martin has entered into contractual arrangements and such authorisations, orders, grants, recognitions, confirmations, certifications, consents, clearances, licences, permissions, exemptions and approvals remaining in full force and effect at the time at which the Offer becomes or is otherwise declared unconditional in all respects, and there being no intimation of any intention to revoke, modify, suspend, restrict or not to renew the same and all necessary filings and applications having been made, all appropriate waiting and other time periods (including extensions thereto) under any applicable legislation and regulations in any applicable jurisdiction having expired, lapsed or been terminated and all necessary statutory or regulatory obligations in any jurisdiction in respect of the Offer or the proposed acquisition of Trio by R.P. Martin or of any Trio Shares or any matters arising therefrom having been complied with; (d) save as fairly disclosed in writing to R.P. Martin prior to the date of the announcement of the Offer, no notice having been received by any member of the wider Trio Group from the Relevant Authorities or any party with whom any member of the wider Trio Group has any contractual or other relationship, that the interests held by any member of the wider Trio Group under licences, leases, consents, permits and other rights will be materially (in the context of the wider Trio Group taken as a whole) adversely amended or otherwise affected by the Offer or the proposed acquisition of Trio or any matters arising therefrom, and that such licences, leases, consents, permits and other rights are in full force and effect and that there is no intention to revoke, modify, suspend, restrict, limit or amend any of the same; (e)save as fairly disclosed in writing to R.P. Martin prior to the date of the announcement of the Offer, there being no provision of any agreement, instrument, permit, licence, lease or other arrangement to which any member of the wider Trio Group is a party or by or to which any member of the wider Trio Group or any of its assets may be bound, or subject which, as a consequence of the Offer or the acquisition or the proposed acquisition by R.P. Martin of the Trio Shares or any of them or because of a change in the control or management of Trio or any member of the wider Trio Group or any matters arising therefrom or otherwise, could or might reasonably expect to have the result that: i. any moneys borrowed by, or other indebtedness, actual or contingent, of, or grant available to, any member of the wider Trio Group is or becomes repayable or capable of being declared repayable immediately or earlier than the repayment date stated in such agreement, instrument or other arrangement or the ability of any member of the wider Trio Group to borrow moneys or incur indebtedness is withdrawn or inhibited or adversely affected; ii. any mortgage, charge or other security interest is created or enforced over the whole or any part of the business, property or assets of any member of the wider Trio Group or any such security (whenever and wherever arising or having arisen) becomes enforceable; iii.any such agreement, instrument, permit, licence or other arrangement, or any right, interest, liability or obligation of any member of the wider Trio Group therein, is terminated or adversely modified or affected or any adverse action is taken or onerous obligation arises thereunder; iv. the value of any member of the wider Trio Group or their respective financial or trading position or profits or prospects is prejudiced or adversely affected or materially adversely modified; v. any asset or interest, the use of which is enjoyed by any member of the wider Trio Group, being or falling to be charged or disposed of or any right arising under which any such asset or interest could be required to be disposed of or charged or could cease to be available to R.P. Martin or any member of the wider Trio Group, in each case otherwise than in the ordinary course of business; vi. the assets, rights, liabilities, obligations or interests or business of any member of the wider Trio Group under any such arrangement, agreement, licence, permit, lease or instrument or in or with any other person, firm or company (or any arrangement relating to such interest or business) is terminated or adversely modified or affected or any onerous obligations arising or any adverse actions being taken thereunder; vii.any member of the wider Trio Group ceases to be able to carry on business under any name under which it currently does so; viii.any change in or effect on the ownership or use of any intellectual property rights owned or used by any member of the wider Trio Group; or ix. any liabilities (actual or contingent) which are created, arise or become apparent in any member of the wider Trio Group, and no event having occurred which, under any provision of any agreement, arrangement, licence or other instrument to which any member of the wider Trio Group is a party or by or to which any such member or any of its assets are bound or subject, would be reasonably likely to result in any events or circumstances as are referred to in paragraphs (i) to (viii) above; (f) since 30 September 2004 (being the date to which the latest published audited report and accounts of Trio were made up) and save as disclosed in Trio's published report and accounts for the year ended 30 September 2004 or save as announced publicly by Trio to a Regulatory Information Service or fairly disclosed in writing to R.P Martin in connection with the Offer prior to 11 March 2005 being the date upon which the Offer was announced, no member of the wider Trio Group having: i. issued or agreed to issue or authorised or proposed the issue of additional shares of any class or issued or authorised or proposed the issue of additional shares of any class, or granted securities convertible into or exchangeable for, or rights, warrants or options to subscribe for or acquire such shares or convertible securities or redeemed, purchased, reduced or repaid or announced any intention or proposal to do so or made any other change to any part of its share capital; ii. recommended, declared, paid or made or proposed to recommend, declare, pay or make any dividend, bonus issue or other distribution, whether payable in cash or otherwise, other than dividends lawfully paid to Trio or to a member of the wider Trio Group which is a wholly-owned subsidiary of Trio; iii.authorised or proposed or announced its intention to propose any merger or acquisition or disposal or transfer of any body corporate, partnership or business or otherwise than in the ordinary course of business, acquired, transferred, disposed, mortgaged, charged or created any security interest over any assets or any right, title or interest in any asset (including shares and trade investments) or any change in its share or loan capital; iv. issued or authorised or proposed the issue of any debentures; v. otherwise than in the ordinary course of business, incurred or increased any indebtedness or contingent liability which would be material in the context of the wider Trio Group taken as a whole; vi. disposed of or transferred, mortgaged or encumbered any material asset or any right, title or interest in any such asset or authorised, proposed or announced any intention to do so; vii.entered into, varied or terminated any contract, commitment or arrangement (whether in respect of capital expenditure, trading obligations or otherwise) which is of a loss making, long term, onerous or unusual nature or which involves or could involve an obligation of a nature or magnitude which, in each case, is material in the context of the wider Trio Group taken as a whole or authorised, proposed or announced any intention to do so; viii.entered into, varied the terms of or terminated, any contract or agreement (including any service agreement) with any of the directors or senior executives of Trio or its subsidiaries; ix. taken or proposed any corporate action or had any legal proceedings instituted or threatened in relation to or against it for its winding-up (voluntary or otherwise), dissolution or reorganisation or for it to enter into a compromise of its debts or scheme of arrangement of its affairs or for the appointment of a receiver, administrator, administrative receiver, trustee or similar officer of all or any of its assets and revenues or any analogous proceedings in any jurisdiction or for the appointment of any analogous person in any jurisdiction; x. other than in the ordinary course of business, taken any action to commence or institute any legal proceedings or to settle, compromise or discontinue any legal proceedings which have already been commenced or suffered any claims or had any legal proceedings instituted against it or admitted liability in any such claim or proceeding or taken any action to settle or compromise any such claim or proceedings which, in each case, is material in the context of the wider Trio Group taken as a whole; xi. waived or compromised any claim or authorised any such waiver or compromise which is or might reasonably be expected to be material in the context of the wider Trio Group as a whole; xii.entered into, implemented, effected, authorised, or proposed or announced its intention to enter into, implement, effect, authorise or propose any reconstruction, amalgamation, commitment, scheme or other transaction or arrangement otherwise than in the ordinary course or business; xiii.made any amendment to its memorandum or articles of association; xiv.entered into or varied or terminated or authorised, proposed or announced its intention to enter into, vary or terminate any contract, transaction, commitment or arrangement which is or is likely to be restrictive on the business of any member of the wider Trio Group or R.P. Martin and which is material in the context of the wider Trio Group taken as a whole; xv. made or agreed or consented to any significant change to the terms of the trust deeds constituting the pension schemes established for its directors and/or employees and/or their dependants or to the benefits which accrue, or to the pensions which are payable thereunder, or to the basis on which qualification for or accrual or entitlement to such benefits or pensions are calculated or determined, or to the basis upon which the liabilities (including pensions) of such pension schemes are funded or made, or agreed or consented to, any change to the trustees; xvi.been unable or admitted 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; xvii.purchased, redeemed or repaid or proposed the purchase, redemption or repayment of any of its own shares or other securities or reduced or made any other changes to any part of its share capital to an extent which is material in the context of the wider Trio Group taken as a whole; xviii.entered into or made any offer (which remains open for acceptance) to enter into any contract, commitment, agreement or arrangement or passed any resolution with respect to, or to effect, any of the transactions, matters or events referred to in this condition (f), or announced or proposed an intention to do so; or xix.made or committed to make any bonus, incentive or similar payment, in cash or otherwise, to any current or former employee of the Trio Group to the extent that any such bonus, incentive or similar payment is inconsistent (whether in terms of quantum, frequency or otherwise) with the previous custom practice of the Trio Group; (g) since 31 January 2005 (being the date to which the latest management accounts of Trio were made up) and save as disclosed in Trio's published report and accounts for the year ended 30 September 2004 or save as announced publicly or as fairly disclosed in writing to R.P Martin in connection with the Offer prior to 11 March 2005 being the date upon which the Offer was announced: i. no litigation or arbitration proceedings, prosecution or other legal proceedings having been instituted, announced or threatened or become pending or remained outstanding by or against any member of the wider Trio Group or to which any member of the wider Trio Group is or may become a party (whether as plaintiff, claimant, defendant or otherwise) and no enquiry or investigation by or complaint or reference to any Relevant Authority against or in respect of any member of the wider Trio Group having been threatened, announced or instituted or remaining outstanding by, against or in respect of any member of the wider Trio Group and which in any such case is likely to adversely affect any member of the wider Trio Group to an extent which might reasonably be expected to be material in the context of the wider Trio Group taken as a whole; ii. no adverse change or deterioration having occurred in the business, assets (including cash balances), financial or trading position, profits or prospects of any member of the wider Trio Group in each case to an extent which is or might reasonably be expected to be material in the context of the wider Trio Group taken as a whole; iii.no contingent or other liability of any member of the wider Trio Group having arisen or become apparent which is or might reasonably be expected to be materially adverse in the context of the wider Trio Group taken as a whole; or iv. no steps have been taken and no admissions having been made which are likely to result in the withdrawal, cancellation, termination or modification of any licence held by any member of the wider Trio Group, which is necessary for the proper carrying on of its business and the withdrawal, cancellation, termination or modification of which is or might reasonably be expected to be material in the context of the wider Trio Group taken as a whole; (h) save as fairly disclosed in writing to R.P. Martin in connection with the Offer prior to 11 March 2005, R.P. Martin not having discovered that: i. any business, financial or other information concerning any member of the wider Trio Group that has been disclosed, publicly or otherwise at any time to R.P. Martin, by or on behalf of any member of the wider Trio Group, is misleading, contains a misrepresentation of fact or omits to state a fact necessary to make the information contained therein not misleading and which was not corrected by subsequent public announcement made by Trio to a Regulatory Information Service on or before 4.30 p.m. on the last business day prior to 11 March 2005 and which is material in the context of the Offer; or ii. any member of the wider Trio Group, or any entity in which any such member has a significant economic interest, is subject to any liability, actual or contingent, which is not disclosed in the annual report and accounts of Trio for the financial year ended 30 September 2004 or in the Offer Document and which is or might reasonably be expected to be material in the context of the wider Trio Group taken as a whole; (i) save as publicly announced or fairly disclosed in writing to R.P. Martin in connection with the Offer prior to 11 March 2005, R.P. Martin having discovered that: (i) any past or present member of the wider Trio Group has not complied with any and/or all applicable legislation or regulations of any jurisdiction (or any notices or requirements of any Relevant Authority in any jurisdiction) with regard to the storage, disposal,discharge, spillage, leak or emission of any waste or hazardous substance or any substance likely to impair the environment or to harm human health or otherwise relating to environmental, health or safety matters (which non compliance might give rise to any liability (whether actual or contingent) or cost on the part of any member of the wider Trio Group) which would be material to the wider Trio Group taken as a whole or that there has otherwise been any such disposal, discharge, spillage, leak or emission (whether or not the same constituted a non-compliance by any person with any such legislation or regulations and wherever the same may have taken place) which in any such case might give rise to any liability(whether actual or contingent) or cost on the part of any member of the wider Trio Group and which is or might reasonably be expected to be material in the context of the wider Trio Group taken as a whole; ii. there is any obligation or liability (whether actual or contingent), or any written request by any Relevant Authority, to make good, repair, reinstate or clean up any property or other asset now or previously owned, occupied or made use of by any past or present member of the wider Trio Group, or in which such member may now have or previously has had an interest under any environmental legislation, regulation, decision or order of any Relevant Authority or third party or otherwise which, in each case, is material in the context of the wider Trio Group taken as a whole;