Xp Power Regulatory News (XPP)

21 Feb 2007 07:00

XP Power plcWednesday 21 February 2007 XP Power plc Announcement of corporate reorganisation

On 9 November 2006, XP Power plc ("XP Power" or the "Company") announced the Company's plans to relocate the XP Power group's (the "Group") head quarters to Asia. The board of directors of XP Power ("Directors" or "Board") have since approved a corporate reorganisation to introduce a new Singaporean domiciled company, XP Power Limited ("XP Power Singapore") as the new holding company of the Group.

XP Power today announces that a circular setting out full details of the proposed corporate reorganisation, together with a prospectus in relation to the admission of XP Power Singapore to listing and trading on the London Stock Exchange's main market for listed securities have been sent to shareholders.

Key features of the corporate reorganisation:

* A new Singaporean domiciled company, XP Power Singapore, will be established as the holding company of the Group; * Shareholders of XP Power will receive one share in XP Power Singapore for each share held in XP Power; * Application will be made for XP Power Singapore to be listed on the London Stock Exchange and it is expected to replace XP Power as a member of the FTSE Fledgling Index; * Shares in XP Power Singapore will be tradable in CREST through depositary interests; * It is expected that XP Power's existing dividend policy will be continued by XP Power Singapore; and * XP Power Singapore will report consolidated results under IFRS.

Background to the corporate reorganisation

Given the growing importance of Asia to both the Group's target customer base and supply chain, the Directors have decided that it is appropriate to move the domicile of the Group to Singapore. The main reasons for this move are to:

1) Exploit opportunities and minimise business risks

Major opportunities and risks are expected increasingly to arise in the Group's business operations, the Directors believe that the centre for decision making needs to be in proximity to the originating markets for those opportunities and risks; and

2) Commitment to Asian markets

It is anticipated that such move will demonstrate the Group's commitment to the Asian markets and consequently lead to an increased flow of business from the Asian power supply market.

Overview of the corporate reorganisation

The corporate reorganisation is proposed to be effected by way of a scheme of arrangement under section 425 of the Companies Act (the "Scheme") between XP Power and its shareholders. The Scheme is subject to various conditions including the passing of the requisite resolutions of shareholders and the approval of the Court. If these conditions are satisfied and the Scheme is approved and implemented in full, XP Power Singapore will own the entire issued share capital of XP Power. XP Power Singapore will then be listed on the London Stock Exchange in place of XP Power and is expected to replace XP Power as a member of the FTSE Fledgling Index. Existing shareholders will receive one XP Power Singapore share for each share held in XP Power. The effective date for the Scheme is expected to be 24 April 2007, on which day shares in XP Power would be suspended. It is expected that on 25 April the listing of the existing XP Power shares will be cancelled and the XP Power Singapore shares will be admitted to listing.

The Scheme requires the approval of shareholders at a Court meeting and at an extraordinary general meeting of XP Power ("EGM"). If the Scheme is approved by the requisite majority at the Court meeting and EGM, an application will be made to the Court to sanction the Scheme. Shareholders are therefore asked to approve resolutions implementing various matters in connection with the Scheme, which are set out in the circular to shareholders, at the Court meeting and EGM to be held at 10.00 am and 11.00 am respectively on 23 March 2007.

It is expected that the Scheme will be neutral in tax terms for UK-resident shareholders. In particular, a UK-resident XP Power shareholder who receives XP Power Singapore shares under the Scheme should not be charged for capital gains tax or corporation tax on chargeable gains as a result of the exchange of his XP Power shares for XP Power Singapore shares. The taxation consequences of the Scheme will depend upon the jurisdiction in which the relevant XP Power shareholder is resident for tax purposes.

Arrangements have been made to facilitate the trading of shares in XP Power Singapore in CREST through depositary interests. Pursuant to these arrangements a depositary, Capita IRG Trustees Limited, will hold certificated shares in XP Power Singapore and issue depositary interests representing the underlying shares which will be held on trust for the holders of the depositary interests. The depositary interests will be independent securities constituted under English law and may be held and transferred through the CREST system.

XP Power Singapore will write to participants in the XP Power Share Option Plan and XP Power Share Purchase Plan 2000 in due course to explain the effect of the corporate reorganisation on their participation in more detail. The rules of the XP Power Share Purchase Plan 2000 will be amended by the Board to enable this exchange to be offered.

Details of the current and proposed directors of XP Power Singapore are set out below.

Current Directors of XP Power Singapore

Andy Sng (Director)(aged 36)

Andy joined the Group in July 2005 to set up its China operations. He is currently the General Manager of the XP Shanghai operation which provides various support services to the rest of the

Group including quality assurance, program management, component sourcing and design and verification testing. On the Scheme becoming effective, Andy will hold the office of General Manager, Asia.

Andy has an Electrical Engineering degree and has worked in the power supply industry for eight years in various technical and commercial roles with companies such as Silicon Systems (Singapore)

and Advanced Micro Devices (Singapore).

Mickey Lynch (Director)(age 54)

Mickey joined the Group in April 2001 as Vice President of Finance for XP-Foresight Inc and since February 2003 has headed up the finance team for the Group. Prior to joining XP-Foresight Mickey spent 10 years at Atari Games Corporation; the last five of which were in the role of Chief Financial Officer. Prior to this he spent 12 years with ITT Corporation, holding various financial controllership roles. Mickey holds a Masters Degree in Business Administration. Mickey was elected to the XP Board on 11 June 2003. On the Scheme becoming effective, Joseph will hold the office of Finance Director.

Mike Laver (Director)(age 44)

Mike has 17 years experience in the power supply industry. After completing his degree in Electrical Engineering at UC Santa Barbara, Mike held sales and technical positions with Power Systems Distributors, Compumech and Delta Lu Research. Mike joined Foresight Electronics in 1991 and carried out various senior roles. Mike is currently responsible for the US sales and value added

engineering organisations. Mike was elected to the XP Board on 20 August 2002 and on 3 February 2003 was made President of the Group's North American operations. He will assume this post within XP Power Singapore on the Scheme becoming effective.

Details of the proposed directors assuming the Scheme is approved, are set out below.

Proposed directors of XP Power Singapore

Larry Tracey (Executive Chairman)(age 59)

Larry co-founded Powerline PLC in 1979, where he focused on the strategic direction of the business. In March 1984, he was responsible for the flotation of Powerline on the Unlisted Securities

Market of the London Stock Exchange and earnings grew 220 per cent. in its three years as a quoted company. Larry headed Powerline's expansion into Germany and the US. Powerline was acquired by Chloride PLC in September 1987. In May 1990, Larry joined the board of XP PLC as an Executive Director. In April 2000 he was appointed as Chief Executive Officer. He is responsible for Group strategy including acquisition policy. In April 2002 he became Chairman and Chief Executive of XP Power and in February 2003 assumed the role of Executive Chairman.

James Peters (Deputy Chairman)(age 48)

James has over 20 years experience in the power supply industry. He joined Powerline shortly after its formation in 1980 and was involved in various aspects of the business. In November 1988 he founded XP. In April 2000, he was appointed as European Managing Director of XP and he was responsible for the overall management of the Group's European businesses. In February 2003 James was appointed

Deputy Chairman of XP Power.

Duncan Penny (Chief Executive)(age 44)

Between October 1998 and March 2000, Duncan was the controller for the European, Middle Eastern and African regions for Dell Computer Corporation, prior to which Duncan spent eight years working

for LSI Logic Corporation where he held senior financial positions in both Europe and Silicon Valley. From 1985 to 1990, Duncan spent five years at Coopers & Lybrand in general practice and corporate finance. He joined XP in April 2000 as Group Finance Director. In February 2003 he was appointed Chief Executive of XP Power.

John Dyson (Non-Executive Director)(age 57)

John was appointed Chief Executive of Pace Micro Technology plc in May 2003, prior to which he had been Finance Director since November 1997. John retired from Pace Micro Technology plc during 2006 and has co-founded a new business called Telehealth Solutions Limited which has developed communications technology to remotely monitor medical devices. Before Pace Micro Technology plc he held senior positions in both Silicon Valley and Europe for LSI Logic Corporation from June 1990 to November 1997. From September 1988 to June 1990 John was

co-founder and Managing Director of Modacom Limited, prior to which he was Finance Director of Norbain Electronics plc from 1986 to1988 and CASE Communications plc from 1977 to 1986. He joined the board of XP Power in June 2000. He is the senior non-executive director and Chairman of the Remuneration Committee.

Michael Hafferty (Non-Executive Director)(age 64)

Michael has been the founder and CEO of several technology companies, including Tricom Ltd., VegaStream Ltd and Arkstream Inc. He was a main board director of CASE Communications plc for its highly successful launch onto the London Stock Exchange and as Sales & Marketing Director built a worldwide sales and service organisation. Michael is the founder of the consulting company Arkbridge Pte. Ltd., based in Singapore and as a result of that position was appointed Vice President, Asia PAC for the international software company iTRACS Corporation. He is a Fellow of the Chartered Institute of Marketing and Liveryman in the Worshipful Company of Marketers.

Expected timetable of key events

Circular and prospectus sent to shareholders 21 February 2007

Court Meeting 10.00 am on 23 March 2007

Extraordinary General Meeting 11.00 am on 23 March 2007

Last day for dealings in XP Power shares 23 April 2007

Scheme record time 6.00 pm on 24 April 2007

Effective date of Scheme 24 April 2007

Suspension of listing of XP Power 8.00 am on 24 April 2007

Delisting of XP Power shares, 8.00 am on 25 April 2007

XP Power Ltd shares admitted to the

Official List and commencement

of dealings in XP Power Singapore shares

on the London Stock Exchange

Despatch of definitive share certificates 9 May 2007

for XP Power Singapore in certificated form

This timetable is based on XP Power's expectations as at the date of this announcement and may be subject to change.

Investec Bank (UK) Limited is acting for XP Power and XP Power Singapore as Sponsor in connection with the corporate reorganisation and no-one else and will not be responsible to anyone other than XP Power plc and XP Power Singapore for providing the protections afforded to each of their respective clients or for providing advice in relation to the corporate reorganisation or any other matters referred to in this document.

Enquiries:

XP Power plc (0118 984 5515)

Larry Tracey, Executive Chairman

James Peters, Deputy Chairman

Duncan Penny, Chief Executive Officer

Weber Shandwick Financial (020 7067 0700)

Nick DibdenNotes to editors:About XP Power

XP Power provides power supply solutions to the electronics industry.

All electronic equipment needs a power supply. Power supplies convert the incoming AC supply into various levels of DC voltages to drive electronic components and sub-assemblies within the end user's equipment. XP Power segments its business into Communications, Defence and Avionics, Industrial and Medical. By servicing these markets XP Power provides investors with access to technology and industrial sectors of the North American, European and Asian electronics market.

The market is highly fragmented and made up of a large number of small to medium sized Original Equipment Manufacturers who source standard and modified standard power supplies from several hundred power supply companies.

For further information, please visit www.xppower.com

The circular and prospectus are available for inspection at the UK Listing Authority's Document Viewing Facility, which is situated at:

Financial Services Authority25 The North ColonnadeCanary WharfLondon E14 5HSTelephone: 020 7066 1000

Copies of the circular and prospectus are also available for inspection at the registered office of XP Power Singapore at 138 Robinson Road #17-00, The Corporate Office, Singapore 068906 and at the offices of XP Power at 16 Horseshoe Park, Pangbourne, Berkshire RG8 7JW.