ESSEN, Germany, June 29, 2012 /PRNewswire/ -- Elster Group
SE (NYSE: ELT) today announced that it has entered into a
definitive agreement with Melrose PLC, pursuant to which a
wholly-owned subsidiary of Melrose PLC would offer to acquire all
outstanding American Depositary Shares of Elster (ADSs, each of
which represents one-fourth of one ordinary share of Elster (Share)), for $20.50 per ADS in cash (the ADS Offer Price) and
all Shares for $82.00 per Share in
cash, representing an aggregate value for all outstanding ADSs and
Shares of approximately $2.3
billion.
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)
The Administrative Board of Elster has unanimously approved the
transaction. Elster has been informed by its largest shareholder,
Rembrandt Holdings S.A., that Rembrandt has agreed to tender the
17,412,069 Shares owned by it and the 531,025 ADSs owned by its
wholly-owned subsidiary (collectively representing approximately 62
percent of the outstanding share capital of Elster) into the
offer.
The ADS Offer Price represents a 48.6 percent premium over the
closing price on June 11, the last
day prior to press speculation that Rembrandt was considering a
sale of its Elster holding, and a 45.6 percent premium over the one
month volume weighted average price per ADS as of the same
date.
The transaction will be funded by a fully underwritten rights
issue by Melrose that is expected to raise approximately 1.2
billion pounds Sterling as well as by an acquisition tranche
of 0.25 billion pounds under a new term and revolving credit
facility of Melrose.
The closing of the tender offer is conditional, among other
things, on holders of Shares and ADSs tendering at least 75 percent
of the outstanding share capital of Elster, approval of the
acquisition of Elster by the shareholders of Melrose at a general
meeting, admission of the Melrose rights issue shares to the
premium segment of the UK Financial Services Authority's Official
List and to trading on the main market of the London Stock
Exchange, and clearances by relevant regulatory authorities. The
transaction is expected to close in the third quarter of 2012.
"This transaction will consolidate ownership of Elster and
deliver value to current stakeholders," said Simon Beresford-Wylie, chief executive officer
of Elster.
"Melrose has a proven track record of enhancing the value of the
companies it acquires and is committed to supporting Elster's
outstanding employees and management team in executing its plan to
capitalize on the growth we see in the sector," Beresford-Wylie
added.
Following the closing of the tender offer, Elster expects to
continue operating as an independent business with an
Administrative Board that reflects the new ownership structure post
completion of the tender offer and with Melrose chief executive
Simon Peckham and current Elster
chief legal officer Thomas Preute as
managing directors. Following the closing of the tender offer,
Beresford-Wylie and Elster chief financial officer (CFO)
Rainer Beaujean plan to pursue other
opportunities outside of the company, and Melrose CFO Geoff Martin will serve as CFO of Elster.
About Elster
Elster (NYSE: ELT) is one of the world's largest electricity,
gas and water measurement and control providers. Its offerings
include distribution monitoring and control, advanced smart
metering, demand response, networking and software solutions, and
numerous related communications and services – key components for
enabling consumer choice, operational efficiency and conservation.
Its products and solutions are widely used by utilities in the
traditional and emerging Smart Grid markets.
Elster has one of the most extensive installed revenue
measurement bases in the world, with more than 200 million metering
devices deployed over the course of the last 10 years. It sells its
products and services in more than 130 countries across
electricity, gas, water and multi-utility applications for
residential, commercial and industrial, and transmission and
distribution applications.
For more information about Elster, please visit
www.elster.com.
Additional information
This announcement is neither an offer to purchase nor a
solicitation of an offer to sell securities. The tender offer for
the outstanding Elster Shares and ADSs described in this
announcement (the Offer) has not commenced. At the time the Offer
is commenced, Melrose and Mintford AG, an indirect wholly-owned
subsidiary of Melrose, will file a Schedule TO Tender Offer
Statement with the U.S. Securities and Exchange Commission (the
SEC), and Elster will file a Schedule 14D-9
Solicitation/Recommendation Statement with respect to the
Offer.
The Tender Offer Statement (including an offer to purchase, a
related letter of transmittal and other offer documents) and the
Solicitation/Recommendation Statement, as they may be amended from
time to time, will contain important information that should be
read carefully before any decision is made with respect to the
Offer. Those materials and other documents filed by Melrose,
Mintford AG or Elster with the SEC will be available at no charge
on the SEC's web site at www.sec.gov.
The Schedule 14D-9 Solicitation/Recommendation Statement and
related materials, when they are filed with the SEC, may be
obtained for free by directing such requests to Elster, Attention:
Investor Relations, 208 S. Rogers Lane, Raleigh, NC 27610, +1 919 250 5595. No
securities of Melrose have been or will be registered under the
U.S. Securities Act of 1933 and no securities of Melrose may be
offered or sold in the United
States absent registration or an exemption from registration
thereunder. There will be no public offering of any securities of
Melrose in the United States.
This release contains forward-looking statements that involve
risks and uncertainties concerning the parties' ability to close
the transaction and the expected closing date of the transaction,
the anticipated benefits and synergies of the proposed transaction,
anticipated future operations, products and services, and the
anticipated structure of Elster, composition of its Administrative
Board, and role of its key executives following the closing of the
transaction. Actual events or results may differ materially from
those described in this release due to a number of risks and
uncertainties. These potential risks and uncertainties include,
among others, the outcome of regulatory reviews of the proposed
transaction, the ability of the parties to complete the
transaction, the failure to retain key Elster employees, customer
and partner uncertainty regarding the anticipated benefits of the
transaction, the failure of Melrose and Elster to achieve
anticipated goals of the proposed transaction and other risks
detailed in Elster's SEC filings, including those discussed in
Elster's annual report on Form 20-F for the year ended December 31, 2011 and Elster's report of results
for the quarter ended March 31, 2012
furnished on Form 6-K, each of which is on file with the SEC and
available at the SEC's website at www.sec.gov. Elster is not
obligated to update these forward-looking statements to reflect
events or circumstances after the date of this document. Readers
are cautioned not to place undue reliance on these forward-looking
statements, which speak only as of their dates.
SOURCE Elster Group SE
