TIDMCHW TIDMESN
RNS Number : 4373Z
Chime Communications PLC
22 September 2009
NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN WHOLE OR IN PART, IN OR INTO
THE UNITED STATES, AUSTRALIA, CANADA, JERSEY, JAPAN OR ANY OTHER JURISDICTION
WHERE TO DO SO WOULD CONSTITUTE A VIOLATION OF THE RELEVANT LAWS OF SUCH
JURISDICTION
22 September 2009
Recommended Share Offer
by
Chime Communications plc
for
Essentially Group Limited
Summary
The Boards of Chime and Essentially are pleased to announce that they have
reached agreement on the terms of a recommended share offer to be made by Chime
to acquire the whole of the issued and to be issued share capital of
Essentially.
Key terms of the Offer:
* Chime will offer 0.04545 of a New Chime Share for each Essentially Share. Based
on the Closing Price of 177.75 pence per Chime Share on 21 September 2009, being
the last Business Day prior to this announcement, the Offer values each
Essentially Share at 8.08 pence and values the entire issued share capital of
Essentially at approximately GBP18.23 million.
* In addition, Chime has agreed that Essentially Shareholders will be entitled to
receive and retain the Essentially Interim Dividend of 0.36 pence per
Essentially Share as announced today in Essentially's interim results. Payment
of the Essentially Interim Dividend is conditional on approval by the
Essentially Shareholders at a general meeting and on the Offer becoming
Effective.
* The Offer represents:
* a premium of approximately 101.97 per cent. to the Closing Price of 4 pence per
Essentially Share on 21 August 2009, being the last Business Day prior to
Essentially announcing that it was in discussions regarding a potential offer;
and
* a premium of approximately 7.72 per cent. to the Closing Price of 7.5 pence per
Essentially Share on 21 September 2009, being the last Business Day prior to
this announcement.
The Essentially Directors, who have been so advised by Cenkos, consider the
terms of the Offer to be fair and reasonable. In providing their advice, Cenkos
has taken into account the commercial assessments of the Essentially Directors.
In addition, the Essentially Directors consider the terms of the Offer to be in
the best interests of the Essentially Shareholders as a whole.
Accordingly, the Essentially Directors intend unanimously to recommend that
Essentially Shareholders accept the Offer as the Essentially Directors have
irrevocably undertaken to do in respect of their own (and certain family
members') beneficial holdings in Essentially, amounting to, in
aggregate, 45,741,666 Essentially Shares, representing (as at the date of this
announcement) approximately 20.27 per cent. of the existing issued ordinary
share capital of Essentially.
In addition to the irrevocable undertakings from the Essentially Directors,
Chime in aggregate has received irrevocable undertakings from Essentially
Shareholders to accept the Offer in respect of a total of 44,214,482 Essentially
Shares, representing approximately 19.59 per cent. of the existing issued share
capital of Essentially and non-binding letters of intent from Essentially
Shareholders to accept the Offer in respect of 20,868,336 Essentially Shares,
representing approximately 9.25 per cent. of the existing issued share capital
of Essentially. Further details in relation to the irrevocable undertakings and
letters of intent (including in relation to the circumstances in which they
cease to be binding) are given in the main body of this announcement and
Appendix III.
* Commenting on the Offer, Lord Bell, the Chairman of Chime, said:
"We are delighted that we have agreed terms for the recommended acquisition of
Essentially. Our Sports Marketing business has been a considerable success since
we acquired Fast Track in 2007. The integration of Essentially will widen the
spread of sports we cover, bring us some very talented people, allow for some
synergies and rapidly develop more opportunities for growth in what is becoming
a major channel for marketing and communications."
* Commenting on the Offer, John Byfield, the Chairman of Essentially, said:
"The offer by Chime represents the next stage in the growth of Essentially for
its employees and shareholders. There is a good strategic and cultural fit and
our staff, clients and shareholders will all benefit from the association. This
is an excellent opportunity to develop Essentially's business as part of Chime's
strong sports marketing offering. The opportunities for growth are particularly
strong in the sports that the enlarged business operates."
EPL Advisory is acting as exclusive financial adviser to Chime. Numis is acting
as corporate broker and sponsor to Chime. Cenkos is acting as financial adviser
under Rule 3 of the City Code and corporate broker to Essentially.
Further Information
This summary should be read in conjunction with, and is subject to, the full
text of the following announcement and the Appendices. Appendix I sets out the
conditions and certain further terms of the Offer. Appendix II contains
information on bases and sources used in this announcement. Appendix III
provides information in relation to the irrevocable undertakings and letters of
intent held or received by Chime and Appendix IV contains definitions of certain
terms used in this announcement. Please read the offer documentation in its
entirety before making a decision with respect to the Offer.
Enquiries:
+------------------------------------+------------------------------------+
| Chime Communications plc | |
+------------------------------------+------------------------------------+
| Lord Bell | Tel: +44 (0) 7861 8515 |
+------------------------------------+------------------------------------+
| Christopher Satterthwaite | |
+------------------------------------+------------------------------------+
| Bell Pottinger Corporate & | |
| Financial | |
| (PR adviser to Chime) | |
| | |
+------------------------------------+------------------------------------+
| Charles Cook | Tel: +44 (0)20 7861 3232 |
+------------------------------------+------------------------------------+
| Victoria Geoghegan | |
+------------------------------------+------------------------------------+
| Emma Kent | |
+------------------------------------+------------------------------------+
| EPL Advisory LLP | |
| (Financial adviser to Chime) | |
+------------------------------------+------------------------------------+
| David Anderson | Tel: +44 (0)77 4877 6433 |
+------------------------------------+------------------------------------+
| Numis Securities Limited | |
| (Corporate broker and sponsor to | |
| Chime) | |
+------------------------------------+------------------------------------+
| Nick Westlake | Tel: +44 (0)20 7260 1000 |
+------------------------------------+------------------------------------+
| Christopher Wilkinson | |
+------------------------------------+------------------------------------+
| Essentially Group Limited | |
+------------------------------------+------------------------------------+
| Bart Campbell | Tel: +44 (0)20 7820 7000 |
+------------------------------------+------------------------------------+
| Dwight Mighty | |
+------------------------------------+------------------------------------+
| Cenkos Securities plc | |
| (Financial adviser to Essentially) | |
+------------------------------------+------------------------------------+
| Ivonne Cantu | Tel: +44 (0) 20 7397 8900 |
+------------------------------------+------------------------------------+
| Beth McKiernan | |
+------------------------------------+------------------------------------+
This announcement is not intended to, and does not, constitute or form any part
of an offer to sell or an invitation to purchase, otherwise acquire, subscribe
for, sell or otherwise dispose of, any securities or the solicitation of an
offer to purchase or subscribe for any securities pursuant to the Offer or
otherwise. The Offer will be made through the Offer Document and, in respect of
Essentially Shares held in certificated form, the Form of Acceptance, which will
together contain the full terms and conditions of the Offer, including details
of how to accept the Offer. Any acceptance or other response to the Offer should
be made only on the basis of the information contained in the Offer Document
and, in respect of Essentially Shares held in certificated form, the Form of
Acceptance.Chime also intends to publish a prospectus in connection with the
Offer. The New Chime Shares are not being offered to the public by means of this
announcement and this announcement does not constitute a prospectus.
Essentially Shareholders are advised to read carefully the formal documentation
in relation to the Offer once it has been dispatched.
EPL Advisory, which is authorised and regulated in the United Kingdom by the
Financial Services Authority, is acting exclusively for Chime and no one else in
connection with the Offer and will not be responsible to anyone other than Chime
for providing the protections afforded to its clients or for providing advice in
relation to the Offer or in relation to the matters described in this
announcement or any transaction or arrangement referred to herein.
Numis, which is authorised and regulated in the United Kingdom by the Financial
Services Authority, is acting exclusively for Chime and no one else in
connection with the Offer and will not be responsible to anyone other than Chime
for providing the protections afforded to its clients or for providing advice in
relation to the Offer or in relation to the matters described in this
announcement or any transaction or arrangement referred to herein.
Cenkos, which is authorised and regulated in the United Kingdom by the Financial
Services Authority, is acting exclusively for Essentially and no one else in
connection with the Offer and will not be responsible to anyone other than
Essentially for providing the protections afforded to its clients for providing
advice in relation to the Offer or in relation to the contents of this
announcement or any transaction or any other matters referred to herein.
Overseas Jurisdictions
The release, publication or distribution of this announcement in jurisdictions
other than the United Kingdom may be restricted by law and therefore any persons
who are subject to the laws of any jurisdiction other than the United Kingdom
should inform themselves about, and observe, any applicable requirements. This
announcement has been prepared for the purposes of complying with English law
and the City 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 and regulations of any jurisdiction outside of the
United Kingdom.
The availability of the Offer to persons who are not resident in and citizens of
the United Kingdom may be affected by the laws of the relevant jurisdiction in
which they are located.
The Offer will not be made, directly or indirectly, in or into any jurisdiction
where to do so would constitute a breach of securities laws in that
jurisdiction, and the Offer will not be capable of acceptance from or within any
such jurisdiction. Accordingly, copies of this announcement are not being, and
must not be, directly or indirectly, mailed or otherwise forwarded, distributed
or sent in, into or from any jurisdiction where to do so would constitute a
breach of securities laws in that jurisdiction, and persons receiving this
announcement (including custodians, nominees and trustees) must not mail or
otherwise distribute or send it in, into or from such jurisdictions as doing so
may invalidate any purported acceptance of the Offer.
This announcement is not an offer of securities for sale in the United States,
Australia, Canada, Jersey or Japan or in any other jurisdiction in which such an
offer is unlawful. The New Chime Shares, which will be issued in connection
with the Offer, have not been, and will not be, registered under the US
Securities Act or under the securities law of any state, district or other
jurisdiction of the United States, or Australia, Canada, Jersey or Japan, and no
regulatory clearance in respect of the New Chime Shares has been, or will be,
applied for in any jurisdiction other than the UK. The New Chime Shares may not
be offered, sold, or delivered, directly or indirectly, in, into or from the
United States except pursuant to an applicable exemption from, or in
a transaction not subject to, the registration requirements of the US Securities
Act or such other securities laws. The New Chime Shares may also not be offered,
sold or delivered, directly or indirectly, in, into or from Australia, Canada,
Jersey or Japan or to, or for the account or benefit of, any resident of
Australia, Canada, Jersey or Japan except pursuant to an applicable exemption
from, or in a transaction not subject to, applicable securities laws of those
jurisdictions. In the United States, Australia, Canada, Jersey, Japan and any
other overseas jurisdiction in which the offer or issuance of New Chime Shares
would constitute a breach of applicable securities laws, absent an applicable
exemption therefrom, Essentially Shareholders who otherwise validly accept the
Offer will receive, in lieu of the New Chime Shares to which they would
otherwise be entitled under the terms of the Offer, the net cash proceeds of the
sale of such shares, as more fully set out in the Offer Document.
Cautionary Note Regarding Forward Looking Statements
This announcement contains forward looking statements that are based on current
expectations or beliefs, as well as assumptions about future events. These
statements, which speak only as at the date of this document, are based on the
current expectations of the management of Chime and are naturally subject to
uncertainty and changes in circumstances. Undue reliance should not be placed on
any such statements because, by their very nature, they are subject to known and
unknown risks and uncertainties and can be affected by other factors that could
cause actual results, and Chime's plans and objectives, to differ materially
from those expressed or implied in the forward looking statements.
There are several factors which could cause actual results to differ materially
from those expressed or implied in forward looking statements. Among the
factors that could cause actual results to differ materially from those
described in the forward looking statements are Chime's ability to combine
successfully the businesses of Essentially and Chime and to realise expected
synergies from that combination, changes in the global, political, economic,
business, competitive, market and regulatory forces, future exchange and
interest rates, changes in tax rates and future business combinations or
dispositions and lower than expected revenues.
Neither Chime nor Essentially undertakes any obligation (except as required by
the Listing Rules and the rules of the London Stock Exchange) to revise or
update any forward looking statement contained in this announcement, regardless
of whether that statement is affected as a result of new information, future
events or otherwise.
Nothing in this announcement is intended to be a profit forecast and statements
in this announcement should not be interpreted to mean that the earnings per
Chime Share for the current or future financial periods will necessarily be
greater than those for the relevant preceding financial period.
Dealing Disclosure Requirements
Under the provisions of Rule 8.3 of the City Code, if any person is, or becomes,
"interested" (directly or indirectly) in one per cent. or more of any class of
"relevant securities" of Chime or Essentially, all "dealings" in any "relevant
securities" of that company (including by means of an option in respect of, or a
derivative referenced to, any such "relevant securities") must be publicly
disclosed by no later than 3.30 p.m. on the London business day following the
date of the relevant transaction. This requirement will continue until the date
on which the Offer becomes, or is declared, unconditional as to acceptances,
lapses or is otherwise withdrawn or on which the "offer period" otherwise ends.
If two or more persons act together pursuant to an agreement or understanding,
whether formal or informal, to acquire an "interest" in "relevant securities" of
Chime or Essentially, they will be deemed to be a single person for the purpose
of Rule 8.3.
Under the provisions of Rule 8.1 of the City Code, all "dealings" in "relevant
securities" of Chime or Essentially by Chime or Essentially, or by any of their
respective "associates", must be disclosed by no later than 12.00 noon on the
London business day following the date of the relevant transaction.
A disclosure table, giving details of the companies in whose "relevant
securities" "dealings" should be disclosed, and the number of such securities in
issue, can be found on the Panel's website at www.thetakeoverpanel.org.uk.
"Interests in securities" arise, in summary, when a person has long economic
exposure, whether conditional or absolute, to changes in the price of
securities. In particular, a person will be treated as having an "interest" by
virtue of the ownership or control of securities, or by virtue of any option in
respect of, or derivative referenced to, securities.
Terms in quotation marks are defined in the City Code, which can also be found
on the Panel's website. If you are in any doubt as to whether or not you are
required to disclose a "dealing" under Rule 8, you should consult the Panel.
Publication on the Chime and Essentially websites
A copy of this announcement is and will be available for inspection free of
charge, subject to certain restrictions relating to persons resident in
restricted jurisdictions, on Chime's website at www.chime.plc.uk and
Essentially's website at www.essentiallygroup.com.
NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN WHOLE OR IN PART, IN OR INTO
THE UNITED STATES, AUSTRALIA, CANADA, JERSEY, JAPAN OR ANY OTHER JURISDICTION
WHERE TO DO SO WOULD CONSTITUTE A VIOLATION OF THE RELEVANT LAWS OF SUCH
JURISDICTION
22 September 2009
Recommended Share Offer
by
Chime Communications plc
for
Essentially Group Limited
1. Introduction
The Boards of Chime and Essentially are pleased to announce that they have
reached agreement on the terms of a recommended share offer to be made by Chime
to acquire the whole of the issued and to be issued share capital of
Essentially.
2. The Offer
Pursuant to the Offer, which will be on and subject to the terms and conditions
set out below and in Appendix 1 and the full terms and conditions which will be
set out in the Offer Document and, in respect of Essentially Shares held in
certificated form, the Form of Acceptance, Essentially Shareholders will be
entitled to receive:
+---------------------------------+---------------------------------+
| for each Essentially | 0.04545 of a New Chime Share |
| Share | |
+---------------------------------+---------------------------------+
and so in proportion for any number of Essentially Shares held.
In addition, Chime has agreed that Essentially Shareholders will be entitled to
receive and retain the Essentially Interim Dividend of 0.36 pence per
Essentially Share as announced today in Essentially's interim results. The
Essentially Interim Dividend will be payable to Essentially Shareholders on the
register on 2 October 2009 and the ex dividend date is 30 September 2009.Payment
of the Essentially Interim Dividend is conditional on approval by the
Essentially Shareholders of the Essentially Interim Dividend at a general
meeting to be convened by the Essentially Directors and on the Offer becoming
Effective.
Based on the Closing Price of 177.75 pence per Chime Share on 21 September 2009,
being the last Business Day prior to this announcement, the Offer values each
Essentially Share at 8.08 pence and values the entire issued share capital of
Essentially at approximately GBP18.23 million.
The Offer represents:
* a premium of approximately 101.97 per cent. to the Closing Price of 4 pence per
Essentially Share on 21 August 2009, being the last Business Day prior to
Essentially announcing that it was in discussions regarding a potential offer;
and
* a premium of approximately 7.72 per cent. to the Closing Price of 7.5 pence per
Essentially Share on 21 September 2009, being the last Business Day prior to
this announcement.
Assuming that the maximum number of New Chime Shares is issued to Essentially
Shareholders under the Offer, it is expected that current Chime Shareholders
will own approximately 84.76 per cent., and current Essentially Shareholders
will own approximately 15.24 per cent., of Chime's enlarged issued share
capital once the Offer becomes Effective.
No fractions of New Chime Shares will be issued to holders of Essentially
Shares. Any fractional entitlements to New Chime Shares will be rounded up or
down to the nearest whole number (with fractional entitlements to 0.5 or more of
a New Chime Share being rounded up).
Essentially Shares will be acquired by Chime, pursuant to the Offer, fully paid
and free from all liens, equities, charges, encumbrances, rights of pre-emption
and any other third party rights or interest whatsoever and together with all
rights now or hereafter attaching thereto, including voting rights and, without
limitation, the right to receive and retain in full all dividends and other
distributions (if any) declared on or after the date of this announcement, other
than the Essentially Interim Dividend.
The New Chime Shares will, when issued, be fully paid and rank pari passu in all
respects with the existing Chime Shares, including, where the record date for
determining entitlements is on or after the date of issue of the New Chime
Shares, the right to all dividends and other distributions (if any) declared,
made or paid by Chime. For the avoidance of doubt, the New Chime Shares will
not qualify for the Chime Interim Dividend announced on 25 August 2009.
Application will be made to the UKLA for the New Chime Shares to be admitted to
the Official List and to the London Stock Exchange for the New Chime Shares to
be admitted to trading on the London Stock Exchange's market for listed
securities. It is expected that admission will become effective and that
dealings for normal settlement in the New Chime Shares will commence shortly
following the date on which the Offer becomes or is declared unconditional in
all respects (save only for the admission of such shares becoming effective).
The Offer will be subject to the satisfaction or, where appropriate, waiver of
the conditions of the Offer set out in Appendix I, including the admission to
trading of the New Chime Shares.
3. Unanimous recommendation and undertakings to accept the Offer
The Essentially Directors, who have been so advised by Cenkos, consider the
terms of the Offer to be fair and reasonable. In providing their advice, Cenkos
has taken into account the commercial assessments of the Essentially Directors.
In addition, the Essentially Directors consider the terms of the Offer to be in
the best interests of the Essentially Shareholders as a whole.
Accordingly, the Essentially Directors intend unanimously to recommend that
Essentially Shareholders accept the Offer as the Essentially Directors have
irrevocably undertaken to do in respect of their own beneficial holdings in
Essentially, amounting in aggregate to 45,741,666 Essentially Shares,
representing (as of the date of this announcement) approximately 20.27 per cent.
of the existing issued ordinary share capital of Essentially.
4. Background to and reasons for the Offer
Chime intends to integrate Essentially into its existing sports management
business. The Essentially satellite offices in India, South Africa, Australia
and New Zealand will enhance Chime's existing business in the Commonwealth
sports area. As one of the leading marketing agencies in rugby and cricket
worldwide, the Chime Board expects that Chime's existing sports marketing
business, when combined with Essentially's, will be a major contributor to the
Enlarged Group. It is Chime's intention to report sports marketing activity as a
separate division from January 2010. The Chime and Essentially teams have
reviewed the prospects for the sports marketing business and are excited by the
opportunities for substantial revenue growth based on existing long term
contracts.In addition some immediate cost savings will result from the
elimination of Essentially's costs relating to its AIM admission and separate
public company status.
The Board of Chime expects the acquisition to be earnings enhancing in the first
full year after acquisition and before taking account of one-off costs relating
to the acquisition and amortisation of intangible assets. The foregoing
statement is not intended to be a profit forecast and statements in this
announcement should not be interpreted to mean that the earnings per Chime Share
for the current or future financial periods will necessarily be greater than
those for the relevant preceding financial period.
5. Background to and reasons for the recommendation
Essentially was formed in 2001 as a motorsport business and, at its admission to
AIM in May 2006, management's intention was to create a leading sports marketing
and athlete management business through a series of acquisitions. Essentially's
acquisitions have been funded by equity issues, internal cash generation and
bank funding. Essentially has made eight acquisitions which have given it a
leading position in the UK sports marketing business in cricket and rugby and a
global reach in athlete management in these sports.
Over the past year, the Essentially Directors have been evaluating Essentially's
next stage of growth and reassessing its strategy particularly in the light of
the economic conditions that have prevailed. Such conditions make it difficult
for Essentially to continue to pursue its acquisition strategy given a number of
factors including constraints in securing equity or debt financing,
Essentially's depressed share price and the gap in valuation expectations
between sellers and buyers created by uncertainty in the economic outlook. While
Essentially can pursue an organic growth strategy in the short term, the
Essentially Directors believe that the progress of the business would be
materially enhanced through increased scale, a stronger corporate profile and
access to greater financial resources.
The Offer represents an opportunity for Essentially to combine its business with
Fast Track, Chime's sports marketing agency business, to create a larger, more
diversified group with a stronger market presence. The businesses of Essentially
and Fast Track are highly complementary. Essentially's strengths lie in the
marketing of rights and in athlete management in rugby and cricket while Fast
Track enjoys strong positions in event management, communications and
consultancy in complementary sports.
In accepting the Offer, following which Essentially Shareholders would receive
New Chime Shares, Essentially Shareholders will benefit from:
* continued exposure to Essentially's business under a stronger platform for
growth and profitability;
* additional exposure to a larger, more diversified business in sports marketing
and marketing services;
* increased capital market scale;
* increased share liquidity; and
* improved prospects of both retaining and attracting new personnel.
In considering whether to recommend the proposal, the Essentially Directors have
also taken into consideration the following:
* Essentially Shareholders representing in aggregate approximately 52.27 per cent.
of Essentially's issued share capital have already indicated their support for
the Offer of which 12.41 per cent. represent institutional shareholders who are
independent of the Essentially Directors and management;
* the lack of liquidity in Essentially Shares and Essentially's current size mean
that neither Essentially nor Essentially Shareholders are currently benefiting
significantly from Essentially's admission to AIM; and
* the consideration payable under the Offer represents a premium of approximately
101.97 per cent. to the Closing Price of 4 pence per Essentially Share on
21 August 2009, being the last Business Day prior to Essentially announcing that
it was in discussions regarding a potential offer.
On the basis of the above the Essentially Directors intend unanimously to
recommend that Essentially Shareholders accept the Offer.
6. Irrevocable Undertakings
Chime has received irrevocable undertakings to accept, or procure acceptance of,
the Offer from:
* each of the Essentially Directors (or their nominees, family members or
associated companies) in respect of their entire personal holdings of
45,741,666 Essentially Shares representing, in aggregate, approximately 20.27
per cent. of the existing issued share capital of Essentially; and
* certain Essentially senior managers (or their nominees, family members or
associated companies) in respect of their entire beneficial shareholdings of
44,214,482 Essentially Shares representing, in aggregate, approximately 19.59
per cent. of the existing issued share capital of Essentially.
Accordingly, Chime has received irrevocable undertakings to accept, or procure
acceptance of, the Offer in respect of, in aggregate, 89,956,148 Essentially
Shares representing approximately 39.86 per cent. of the existing issued share
capital of Essentially.
These irrevocable undertakings continue to be binding in the event of a higher
offer being made for Essentially but cease to be binding if the Offer is
withdrawn by Chime (with the consent of the Panel if required) or lapses.
Certain of the Essentially Directors and senior managers (or their nominees,
family members or associated companies, as applicable) have also undertaken to
Chime not to dispose of part of the New Chime Shares which they receive pursuant
to the Offer for a period of up to 12 months.
As at 21 September 2009, being the last Business Day prior to this announcement,
the following Essentially Shareholders have delivered letters to Chime
confirming their intention to accept the Offer:
* AXA Framlington, the judgemental equity division of AXA Investment Managers UK
Limited, in respect of 8,470,139 Essentially Shares over which it has
discretionary management control;
* Octopus Investments Limited in respect of 7,905,305 Essentially Shares over
which it has discretionary management control; and
* Bluehone Investors LLP in respect of 4,492,892 Essentially Shares held by two
trusts which it manages, Active Capital Trust LLP and Bluehone AIM VCT2 plc.
These letters of intent represent in aggregate 20,868,336 Essentially Shares
representing approximately 9.25 per cent. of Essentially's existing issued
share capital.The letters of intent referred to above are non-binding and do not
prevent the relevant shareholders from rejecting the Offer if they so choose.
In addition, Rensburg AIM VCT plc, which holds 7,136,806 Essentially Shares, has
confirmed its intention to accept the Offer, provided a higher offer is not
forthcoming during the Offer Period.
Further details of the irrevocable undertakings and letters of intent are set
out in Appendix III to this announcement.
7. Information on Chime
Chime is the holding company for the Chime Group, one of the leading independent
communications groups in the UK. The Chime Group helps clients create, manage,
monitor and market their businesses, brands and reputations both in the UK and
internationally. The principal business of the Chime Group is to provide public
relations, advertising, sports marketing, market research, direct marketing,
design and event management consultancy.
The Chime Group consists of one of the UK's leading public relations groups,
Bell Pottinger, a research and consultation business, Opinion Leader, an
advertising and marketing services group, VCCP Limited, and a leading UK sports
marketing agency, Fast Track. In addition to its public relations division,
Chime has both a research and engagement division and an advertising and
marketing services division. The advertising and marketing services division has
grown inorganically through the acquisition of VCCP Limited and other
businesses.
Chime is made up of three divisions, 50 agencies and over 1,000 people with
offices in London, Liverpool, Leeds, Macclesfield, Glasgow and Cardiff in the
UK, Berlin, Munich, Hamburg and Madrid in Europe, New York, Boston and
Washington DC in the United States and Dubai, Abu Dhabi, Bahrain and Qatar in
the Middle East. As set out in the audited financial information for Chime, for
the financial year ended 31 December 2008, Chime reported operating income of
GBP112.1 million and profit after tax of GBP16.3 million. As at 31 December
2008, Chime's net assets were GBP88.5 million.
8. Current trading and prospects of Chime
As announced in Chime's interim results for the six months ended 30 June 2009,
the Chime Group has delivered its highest first half pre-tax profit in the
history of Chime.
The Chime Group's productivity has improved (income per head in the six months
ended 30 June 2009 increased to GBP58,000 from GBP55,000 in the first half of
the 2008 financial year). The Chime Group consolidated its business, with
clients using more than one company increasing to 169 in the first half year
from 159 in the first half of 2008 and Chime's top 30 clients representing 57
per cent. of the Chime Group's income (compared to 46 per cent. in the six
months ended 30 June 2008). Income per client rose to GBP64,000 in the first
half of 2009 from GBP51,000 in the first half of 2008. Nearly half of the Chime
Group's operating income came from international work compared to 34 per cent.
in the first half of 2008.
The consequence of this consolidation is that the Chime Group acted for 908
clients in the first half of 2009 compared to 1,066 in the first half of 2008
and the number of clients paying the Chime Group over GBP50,000 fell from 190 to
164.
The Chime Group's new business pipeline is strong with a large proportion of
second half operating income committed (nearly 90 per cent.). The Board of Chime
believes that the Chime Group's costs are under control, its cash management is
strong and the Chime Group has the opportunity to make some strategic
acquisitions to develop its business in preparation for a possible upturn at
some point during 2010.
The Chime Group continues to operate a 4 times cover dividend policy (which is
not necessarily paid in line with the proportion of one third in the interim
dividend and two thirds in the final dividend).
The Directors of Chime remain cautiously optimistic for the full financial year.
9. Information on Essentially
Essentially is a specialist sports marketing, media and services company with
business activities centered on rugby and cricket. Essentially was founded in
2001 and was admitted to AIM in May 2006. Essentially's headquarters are in
London and it has additional offices in India, South Africa, Australia, New
Zealand and Japan. Essentially has approximately 100 employees worldwide.
Essentially operates three complementary divisions: sports marketing, athlete
management and professional services.
In sports marketing, Essentially procures sponsorship rights to sell for leading
sports federations. Essentially is one of the UK's leading agencies of cricket
and rugby rights and also has an established position in Formula 1.
Essentially currently has exclusive rights to sell perimeter marketing at all
test match cricket grounds for all international cricket in the UK to 2010
(including Twenty20, One Day International and Test matches), and exclusive
rights to perimeter marketing at Twickenham and the Millennium Stadium. As part
of its sports marketing business, Essentially also sources, negotiates and
secures sponsorship agreements and other marketing initiatives for a wide range
of organisations including global brands and sports federations including events
management. In athlete management, Essentially acts as manager for approximately
500 sports personalities in the UK, New Zealand, South Africa, Japan, Australia
and India. Essentially's professional services division offers clients
specialist advisory services including accounting and tax advice. This includes
tax planning, accounting, image rights advice and secretarial services for
athletes, media personalities, professional sports clubs and governing bodies.
10. Current trading of Essentially
For the year ended 31 December 2008, Essentially reported revenues of GBP16.3
million, gross profit of GBP9.4 million, earnings before taxation, interest,
depreciation, amortisation and exceptional items of GBP2.6 million and net
assets as at 31 December 2008 of GBP20.0 million.
Essentially today announced its interim results for the six months ended 30 June
2009. Essentially reported revenues of GBP10.0 million, gross profit of GBP5.4
million and earnings before taxation, interest, depreciation, amortisation and
exceptional items of GBP1.2 million for the period. Essentially's net assets as
at 30 June 2009 were GBP19.2 million and its gross assets were GBP41.9 million.
Cash on the balance sheet at 30 June 2009 was GBP4.3 million, with a net debt
position of GBP4.0 million after taking account of funds collected on behalf of
clients. Conditional upon the Offer becoming Effective, Chime intends to repay
Essentially's debt using Chime's existing facilities.The Essentially Board
remains positive as to Essentially's outlook.
The full text of Essentially's results for the year ended 31 December 2008 and
six months ended 30 June 2009 are available on Essentially's website at
www.essentiallygroup.com.
11. Management and Employees
Chime attaches great importance to the skills and experience of the existing
management and employees of Essentially, and intends that Essentially's current
management team will continue to be involved in the ongoing business of
Essentially within the Enlarged Group.
Chime confirms that, following the Offer becoming or being declared
unconditional in all respects, the existing employment rights of employees and
management of Essentially, including pension rights, will be fully safeguarded.
If the Offer becomes or is declared unconditional in all respects, John Byfield,
the Executive Chairman of Essentially and James Butterfield and Richard
Battersby, each of whom are non-executive Directors of Essentially, have agreed
to resign from the Board of Essentially. Each will receive termination payments
in accordance with their contractual entitlements.
Paladin Management Limited and John Byfield will enter into a consultancy
agreement with Essentially Sport Limited, a Guernsey registered subsidiary of
Essentially Group Limited, to run the motor sports division. The agreement will
be subject to termination on 6 months notice. On entering into the agreement,
Paladin Management Limited will be paid GBP38,000 and an annual fee of
GBP75,000. Cenkos considers these payments to be fair and reasonable so far as
the Essentially Shareholders are concerned.
12. Management Incentive Scheme
Conditional on the Offer becoming or being declared unconditional in all
respects, Chime intends to put in place a management incentive scheme for
certain members of Essentially's senior management, including Bart Campbell, Tim
Berg, Dwight Mighty and Matthew Vandrau. Under the scheme, 19 of Essentially's
senior management may become entitled to payments of up to an aggregate of
GBP2.5 million over three years (a maximum of GBP833,000 per annum).
The payment of benefits under the management incentive scheme is conditional on
the performance of the combined businesses of Fast Track and Essentially, as
part of the Enlarged Group, achieving certain performance targets over the
financial years 2010, 2011 and 2012. Performance will be measured on the
combined trading profits before interest, amortisation of goodwill and
intangible assets and costs of the management incentive scheme for Fast Track
and Essentially over this three year period. The performance targets for the
management incentive scheme require Fast Track and Essentially to increase their
current levels of combined operating profit by 16 per cent. in 2010, 12.5 per
cent. in 2010 and 11 per cent. in 2012.
Cenkos consider the terms of the management incentive scheme to be fair and
reasonable so far as the Essentially Shareholders are concerned.
Chime intends also to vary the existing deferred consideration arrangements put
in place in March 2007 for certain members of Fast Track's management so that
entitlements to payments under these arrangements will in future also be
calculated by reference to the performance of the combined businesses of Fast
Track and Essentially.
13. Essentially Share Scheme
Appropriate proposals will be made in due course to participants in the
Essentially Share Scheme. Details of these proposals will be set out in the
Offer Document and in separate letters to be sent to participants in the
Essentially Share Scheme.
14. Non-solicitation and Break Fee Agreement
Chime and Essentially have entered into the Non-solicitation and Break Fee
Agreement in relation to the Offer.The Non-solicitation and Break Fee Agreement
provides for an Exclusivity Period which commenced on 21 September 2009 and
continues until the earlier of (i) the date when Chime's Offer lapses or is
withdrawn; (ii) the date on which the Offer becomes or is declared unconditional
as to acceptances.
During the Exclusivity Period, Essentially has undertaken:
* not to (i) solicit any Alternative Proposal; (ii) enter into any discussions
which relate to an Alternative Proposal; or (iii) enter into any agreement or
arrangement with a view to implementing an Alternative Proposal; and
* to notify Chime as soon as is reasonably practicable if (i) a bona fide proposal
or approach is made to Essentially in relation to any Alternative Proposal; (ii)
a request for information is received by Essentially under Rule 20.2 of the City
Code; or (iii) Essentially provides any information to a Third Party with a view
to that party investigating or making an Alternative Proposal, in each case
subject to any restrictions under applicable law or regulations.
Essentially has also agreed to pay Chime a break fee of GBP182,345, being an
amount equal to 1 per cent. of the value of Essentially calculated by reference
to the terms of the Offer if any of the following occurs: (i) the Board of
Essentially withdraws or adversely modifies its recommendation of the Offer;
(ii) an Alternative Proposal is made and subsequently becomes or is declared
unconditional in all respects or is completed; (iii) if Essentially is in
material breach of any of its obligations under the Non-solicitation and Break
Fee Agreement; (iv) the Offer is withdrawn by Chime with the consent of the
Panel following a material breach of a condition of the Offer as a result of any
action or omission by Essentially; (v) the Board of Essentially fails
unanimously to recommend that Essentially Shareholders vote in favour of any
resolutions necessary to implement the Offer or withdraw or adversely modify
such recommendation; or (vi) Essentially takes any action which results in the
Offer being frustrated or in Essentially Shareholders being denied the
opportunity to decide on its merits (including any action which falls within the
scope of Rule 21.1 of the City Code).
Further information on the Non-solicitation and Break Fee Agreement will be set
out in the Offer Document.
15. Disclosure of Interests in Essentially
Save for the arrangements with Essentially Shareholders in relation to
irrevocable undertakings summarised above, as at 21 September 2009, being the
latest Business Day prior to this announcement, neither Chime, nor, so far as
Chime is aware, any person acting in concert with Chime for the purposes of the
Offer, has any interest in, or right to subscribe for, or has borrowed or lent
(save for any borrowed shares which have been either on-lent or sold) any
Essentially Shares, nor does any such person have any short position or any
arrangement in relation to Essentially Shares. An "arrangement" includes any
indemnity or option arrangement and any agreement or any understanding, formal
or informal, of whatever nature, relating to Essentially Shares which may be an
inducement to deal or refrain from dealing in such securities.
It has not been possible, by the date of this announcement, to ascertain the
interests in Essentially Shares (if any) of all Chime's concert parties. Further
enquiries will be completed prior to publication of the Offer Document. If such
enquiries reveal any such interests, they will be included in the Offer Document
or announced earlier if required by the Panel.
"Interests in securities" is further explained in the paragraph headed "Dealing
Disclosure Requirements" below.
16. Overseas Shareholders
The distribution of this announcement to, and the availability of New Chime
Shares under the terms of the Offer to, persons not resident in the United
Kingdom may be affected by the laws of the relevant jurisdiction. Such persons
should inform themselves about and observe any applicable requirements.
In any case where the delivery of New Chime Shares to an Essentially Shareholder
would or may infringe the laws of any jurisdiction or would or may require Chime
to obtain or observe any governmental or other consent or any registration,
filing or other formality (including ongoing requirements) which Chime regards
as unduly onerous, Chime reserves the right to have the New Chime Shares to
which such person would otherwise be entitled to under the Offer sold in the
market with the proceeds of the sale being remitted to the relevant Essentially
Shareholder.
Further details in relation to Overseas Shareholders will be contained in the
Offer Document.
17. Cancellation of Admission, Re-registration and Compulsory Acquisition
Upon the Offer becoming or being declared unconditional in all respects and
sufficient acceptances having been received, it is the intention of Chime to
apply the provisions of Articles 116 to 118 and Article 121 of the Companies
(Jersey) Law 1991 (as amended) to acquire compulsorily any remaining Essentially
Shares in respect of which the Offer has not been accepted.
Assuming the Offer becomes Effective, Chime also intends to procure the making
of an application by Essentially to the London Stock Exchange for the
cancellation of the admission of the Essentially Shares to AIM. If this
cancellation occurs, it will significantly reduce the liquidity and
marketability of any Essentially Shares not assented to the Offer. It is
anticipated that the cancellation of admission to AIM will take effect no
earlier than 20 Business Days after the Offer becomes or is declared
unconditional in all respects provided that Chime has, by virtue of its
shareholdings and acceptances of the Offer, acquired or agreed to acquire issued
share capital carrying at least 75 per cent. of the voting rights of
Essentially.
It is also intended that, following the Offer becoming or being declared
unconditional and cancellation of the admission of the Essentially Shares to
AIM, Essentially will be re-registered as a private company under the relevant
provisions of the Companies (Jersey) Law 1991 (as amended).
18. General and Documentation
Chime reserves the right to elect to implement the acquisition of Essentially,
with the consent of the Panel, by way of scheme of arrangement under Article 125
of the Companies (Jersey) Law 1991 (as amended). In such event, such scheme will
be implemented on the same terms (subject to appropriate amendment) as the
Offer. References to the Offer and the Offer Document in this announcement shall
include, where applicable, any such scheme of arrangement.
The Offer will be subject to the conditions and further terms set out herein and
in Appendix 1 and to the full terms and conditions which will be set out in the
Offer Document (which will include a letter of recommendation from the Chairman
of Essentially on behalf of the Essentially Board) and, in respect of
Essentially Shares held in certificated form, the Form of Acceptance.In deciding
whether or not to accept the Offer in respect of their Essentially Shares,
Essentially Shareholders should rely on the information contained in, and the
procedures described in, the Offer Document and, in respect of Essentially
Shares held in certificated form, the Form of Acceptance.
Chime also intends to publish a prospectus in connection with the Offer. The New
Chime Shares are not being offered to the public by means of this announcement
and this announcement does not constitute a prospectus.The Offer Document will
be posted to Essentially Shareholders and the Prospectus will be published as
soon as reasonably practicable and in any event within 28 days of the date of
this announcement. Essentially Shareholders are advised to read carefully the
formal documentation in relation to the Offer once it has been dispatched.
The Offer will be governed by English law and will be subject to the
jurisdiction of the English courts. The Offer will be subject to the applicable
requirements of the City Code, the Panel, the London Stock Exchange and the
UKLA.
Further Information
Appendix I sets out the conditions and certain further terms of the Offer.
Appendix II contains information on bases and sources used in this announcement.
Appendix III provides information in relation to certain irrevocable
undertakings and letters of intent and Appendix IV contains definitions of
certain terms used in this announcement. Please read the Offer Document in its
entirety before making a decision with respect to the Offer.
Enquiries:
+------------------------------------+------------------------------------+
| Chime Communications plc | |
+------------------------------------+------------------------------------+
| Lord Bell | Tel: +44 (0)20 7861 8515 |
+------------------------------------+------------------------------------+
| Christopher Satterthwaite | |
+------------------------------------+------------------------------------+
| Bell Pottinger Corporate & | |
| Financial | |
| (PR adviser to Chime) | |
| | |
+------------------------------------+------------------------------------+
| Charles Cook | Tel: +44 (0)20 7861 3232 |
+------------------------------------+------------------------------------+
| Victoria Geoghegan | |
+------------------------------------+------------------------------------+
| Emma Kent | |
+------------------------------------+------------------------------------+
| EPL Advisory LLP | |
| (Financial adviser to Chime) | |
+------------------------------------+------------------------------------+
| David Anderson | Tel: +44 (0)77 4877 6433 |
+------------------------------------+------------------------------------+
| Numis Securities Limited | |
| (Corporate broker and sponsor to | |
| Chime) | |
+------------------------------------+------------------------------------+
| Nick Westlake | Tel: +44 (0)20 7260 1000 |
+------------------------------------+------------------------------------+
| Christopher Wilkinson | |
+------------------------------------+------------------------------------+
| Essentially Group Limited | |
+------------------------------------+------------------------------------+
| Bart Campbell | Tel: +44 (0)20 7820 7000 |
+------------------------------------+------------------------------------+
| Dwight Mighty | |
+------------------------------------+------------------------------------+
| Cenkos Securities plc | |
| (Financial adviser to Essentially) | |
+------------------------------------+------------------------------------+
| Ivonne Cantu | Tel: +44 (0) 20 7397 8900 |
+------------------------------------+------------------------------------+
| Beth McKiernan | |
+------------------------------------+------------------------------------+
This announcement is not intended to, and does not constitute, or form any part
of an offer to sell or an invitation to purchase, otherwise acquire, subscribe
for, sell or otherwise dispose of, any securities or the solicitation of an
offer to purchase or subscribe for any securities pursuant to the Offer or
otherwise. The Offer will be made through the Offer Document and, in respect of
Essentially Shares held in certificated form, the Form of Acceptance, which will
together contain the full terms and conditions of the Offer, including details
of how to accept the Offer. Any acceptance or other response to the Offer should
be made only on the basis of the information contained in the Offer Document
and, in respect of Essentially Shares held in certificated form, the Form of
Acceptance. Chime also intends to publish a prospectus in connection with the
Offer. The New Chime Shares are not being offered to the public by means of this
announcement and this announcement does not constitute a prospectus.
Essentially Shareholders are advised to read carefully the formal documentation
in relation to the Offer once it has been dispatched.
EPL Advisory, which is authorised and regulated in the United Kingdom by the
Financial Services Authority, is acting exclusively for Chime and no one else in
connection with the Offer and will not be responsible to anyone other than Chime
for providing the protections afforded to its clients or for providing advice in
relation to the Offer or in relation to the matters described in this
announcement or any transaction or arrangement referred to herein.
Numis, which is authorised and regulated in the United Kingdom by the Financial
Services Authority, is acting exclusively for Chime and no one else in
connection with the Offer and will not be responsible to anyone other than Chime
for providing the protections afforded to its clients or for providing advice in
relation to the Offer or in relation to the matters described in this
announcement or any transaction or arrangement referred to herein.
Cenkos which is authorised and regulated in the United Kingdom by the Financial
Services Authority, is acting exclusively for Essentially and no one else in
connection with the Offer and will not be responsible to anyone other than
Essentially for providing the protections afforded to its clients for providing
advice in relation to the Offer or in relation to the contents of this
announcement or any transaction or any other matters referred to herein.
Overseas Jurisdictions
The release, publication or distribution of this announcement in jurisdictions
other than the United Kingdom may be restricted by law and therefore any persons
who are subject to the laws of any jurisdiction other than the United Kingdom
should inform themselves about, and observe, any applicable requirements. This
announcement has been prepared for the purposes of complying with English law
and the City 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 and regulations of any jurisdiction outside of the
United Kingdom.
The availability of the Offer to persons who are not resident in and citizens of
the United Kingdom may be affected by the laws of the relevant jurisdiction in
which they are located.
The Offer will not be made, directly or indirectly, in or into any jurisdiction
where to do so would constitute a breach of securities laws in that
jurisdiction, and the Offer will not be capable of acceptance from or within any
such jurisdiction. Accordingly, copies of this announcement are not being, and
must not be, directly or indirectly, mailed or otherwise forwarded, distributed
or sent in, into or from any jurisdiction where to do so would constitute a
breach of securities laws in that jurisdiction, and persons receiving this
announcement (including custodians, nominees and trustees) must not mail or
otherwise distribute or send it in, into or from such jurisdictions as doing so
may invalidate any purported acceptance of the Offer.
This announcement is not an offer of securities for sale in the United States,
Australia, Canada, Jersey or Japan or in any other jurisdiction in which such an
offer is unlawful. The New Chime Shares, which will be issued in connection
with the Offer, have not been, and will not be, registered under the US
Securities Act or under the securities law of any state, district or other
jurisdiction of the United States, or Australia, Canada, Jersey or Japan, and no
regulatory clearance in respect of the New Chime Shares has been, or will be,
applied for in any jurisdiction other than the UK. The New Chime Shares may not
be offered, sold, or delivered, directly or indirectly, in, into or from the
United States except pursuant to an applicable exemption from, or in
a transaction not subject to, the registration requirements of the US Securities
Act or such other securities laws. The New Chime Shares may also not be offered,
sold or delivered, directly or indirectly, in, into or from Australia, Canada,
Jersey or Japan or to, or for the account or benefit of, any resident of
Australia, Canada, Jersey or Japan except pursuant to an applicable exemption
from, or in a transaction not subject to, applicable securities laws of those
jurisdictions. In the United States, Australia, Canada, Jersey, Japan and any
other overseas jurisdiction in which the offer or issuance of New Chime Shares
would constitute a breach of applicable securities laws, absent an applicable
exemption therefrom, Essentially Shareholders who otherwise validly accept the
Offer will receive, in lieu of the New Chime Shares to which they would
otherwise be entitled under the terms of the Offer, the net cash proceeds of the
sale of such shares, as more fully set out in the Offer Document.
Cautionary Note Regarding Forward Looking Statements
This announcement contains forward looking statements that are based on current
expectations or beliefs, as well as assumptions about future events. These
statements, which speak only as at the date of this document, are based on the
current expectations of the management of Chime and are naturally subject to
uncertainty and changes in circumstances. Undue reliance should not be placed on
any such statements because, by their very nature, they are subject to known and
unknown risks and uncertainties and can be affected by other factors that could
cause actual results, and Chime's plans and objectives, to differ materially
from those expressed or implied in the forward looking statements.
There are several factors which could cause actual results to differ materially
from those expressed or implied in forward looking statements. Among the
factors that could cause actual results to differ materially from those
described in the forward looking statements are Chime's ability to combine
successfully the businesses of Essentially and Chime and to realise expected
synergies from that combination, changes in the global, political, economic,
business, competitive, market and regulatory forces, future exchange and
interest rates, changes in tax rates and future business combinations or
dispositions and lower than expected revenues.
Neither Chime nor Essentially undertakes any obligation (except as required by
the Listing Rules and the rules of the London Stock Exchange) to revise or
update any forward looking statement contained in this announcement, regardless
of whether that statement is affected as a result of new information, future
events or otherwise.
Nothing in this announcement is intended to be a profit forecast and statements
in this announcement should not be interpreted to mean that the earnings per
Chime Share for the current or future financial periods will necessarily be
greater than those for the relevant preceding financial period.
Dealing Disclosure Requirements
Under the provisions of Rule 8.3 of the City Code, if any person is, or becomes,
"interested" (directly or indirectly) in one per cent. or more of any class of
"relevant securities" of Chime or Essentially, all "dealings" in any "relevant
securities" of that company (including by means of an option in respect of, or a
derivative referenced to, any such "relevant securities") must be publicly
disclosed by no later than 3.30 p.m. on the London business day following the
date of the relevant transaction. This requirement will continue until the date
on which the Offer becomes, or is declared, unconditional as to acceptances,
lapses or is otherwise withdrawn or on which the "offer period" otherwise ends.
If two or more persons act together pursuant to an agreement or understanding,
whether formal or informal, to acquire an "interest" in "relevant securities" of
Chime or Essentially, they will be deemed to be a single person for the purpose
of Rule 8.3.
Under the provisions of Rule 8.1 of the City Code, all "dealings" in "relevant
securities" of Chime or Essentially by Chime or Essentially, or by any of their
respective "associates", must be disclosed by no later than 12.00 noon on the
London business day following the date of the relevant transaction.
A disclosure table, giving details of the companies in whose "relevant
securities" "dealings" should be disclosed, and the number of such securities in
issue, can be found on the Panel's website at www.thetakeoverpanel.org.uk.
"Interests in securities" arise, in summary, when a person has long economic
exposure, whether conditional or absolute, to changes in the price of
securities. In particular, a person will be treated as having an "interest" by
virtue of the ownership or control of securities, or by virtue of any option in
respect of, or derivative referenced to, securities.
Terms in quotation marks are defined in the City Code, which can also be found
on the Panel's website. If you are in any doubt as to whether or not you are
required to disclose a "dealing" under Rule 8, you should consult the Panel.
Publication on the Chime and Essentially websites
A copy of this announcement is and will be available for inspection free of
charge, subject to certain restrictions relating to persons resident in
restricted jurisdictions, on Chime's website at www.chime.plc.uk and
Essentially's website at www.essentiallygroup.com.
APPENDIX I
CONDITIONS AND CERTAIN FURTHER TERMS OF THE OFFER
Part A: Conditions of the Offer
The Offer will be subject to the following conditions (as amended if
appropriate):
(a) valid acceptances being received (and not, where permitted, withdrawn) by
not later than 3.00 p.m. on the first closing date of the Offer (or such later
time(s) and/or date(s) as Chime may, with the consent of the Panel or in
accordance with the City Code, decide) in respect of not less than 90 per cent.
(or such lower percentage as Chime may decide) (1) in nominal value of the
Essentially Shares to which the Offer relates and (2) of the voting rights
attached to those shares, provided that this condition shall not be satisfied
unless Chime or other members of the Wider Chime Group shall have acquired or
agreed to acquire, whether pursuant to the Offer or otherwise, shares in
Essentially carrying in aggregate more than 50 per cent. of the voting rights
then normally exercisable at general meetings of Essentially. For the purposes
of this condition:
(i) shares which have been unconditionally allotted but not issued before the
Offer becomes or is declared unconditional as to acceptances, whether pursuant
to the exercise of any outstanding subscription or conversion rights or
otherwise, shall be deemed to carry the voting rights they will carry on being
entered into the register of members of Essentially; and
(ii) the expression "Essentially Shares to which the Offer relates" shall be
construed with regard to the provisions of Articles 116, 117(8) and 123(1) and
(2) of the Companies (Jersey) Law 1991 (as amended);
(b)the admission to the Official List of the New Chime Shares to be issued in
connection with the Offer becoming effective in accordance with the Listing
Rules and the admission of such shares to trading becoming effective in
accordance with the Admission and Disclosure Standards of the London Stock
Exchange or if Chime and Essentially so determine (and subject to the consent of
the Panel) the UKLA agreeing to admit such shares to the Official List and the
London Stock Exchange agreeing to admit such shares to trading subject only to
(i) the allotment of such shares and/or (ii) the Offer becoming or being
declared unconditional in all respects;
(c) there being no provision of any agreement, arrangement, licence, permit
or other instrument to which any member of the Wider Essentially Group is a
party or by or to which any such member or any of its assets may be bound,
entitled or subject, which in consequence of the Offer or the proposed
acquisition of any shares or other securities in Essentially or because of a
change in the control or management of Essentially or otherwise, could or might
result, to an extent which is material in the context of the Wider Essentially
Group, in:
(i)any moneys borrowed by or any other indebtedness (actual or contingent) of,
or grant available to any such member, being or becoming repayable or capable of
being declared repayable immediately or earlier than their or its stated
maturity date or repayment date or the ability of any such member to borrow
moneys or incur any indebtedness being withdrawn or inhibited or being capable
of becoming or being withdrawn or inhibited;
(ii)any such agreement, arrangement, licence, permit or instrument or the
rights, liabilities, obligations or interests of any such member thereunder
being terminated or modified or affected or any obligation or liability arising
or any action being taken or arising thereunder;
(iii)any assets or interests of any such member being or falling to be disposed
of or charged or any right arising under which any such asset or interest could
be required to be disposed of or charged;
(iv)the creation or enforcement of any mortgage, charge or other security
interest over the whole or any part of the business, property or assets of any
such member;
(v)the rights, liabilities, obligations or interests of any such member in, or
the business of any such member with, any person, firm or body (or any
arrangement or arrangements relating to any such interest or business) being
terminated, adversely modified or affected;
(vi) the value of any such member or its financial or trading position or
prospects being prejudiced or adversely affected;
(vii) any such member ceasing to be able to carry on business under any name
under which it presently does so; or
(viii) the creation of any liability, actual or contingent, by any such
member,
and no event having occurred which, under any provision of any agreement,
arrangement, licence, permit or other instrument to which any member of the
Wider Essentially Group is a party or by or to which any such member or any of
its assets may be bound, entitled or subject, could result in any of the events
or circumstances as are referred to in sub-paragraphs (i) to (viii) of this
condition;
(d) no government or governmental, quasi-governmental, supranational,
statutory, regulatory, environmental or investigative body, court, trade agency,
association, institution or any other body or person whatsoever in any
jurisdiction (each a "Third Party") having decided to take, institute, implement
or threaten any action, proceeding, suit, investigation, enquiry or reference,
or enacted, made or proposed any statute, regulation, decision or order, or
having taken any other steps which would or might reasonably be expected to:
(i) require, prevent or delay the divestiture, or materially alter the terms
envisaged for any proposed divestiture by any member of the Wider Chime Group or
any member of the Wider Essentially Group of all or any portion of their
respective businesses, assets or property or impose any limitation on the
ability of any of them to conduct their respective businesses (or any of them)
or to own any of their respective assets or properties or any part thereof
which, in any case, is material in the context of the Wider Chime Group or the
Wider Essentially Group in either case taken as a whole;
(ii) require, prevent or delay the divestiture by any member of the Wider
Chime Group of any shares or other securities in Essentially;
(iii) impose any limitation on, or result in a delay in, the ability of any
member of the Wider Chime Group directly or indirectly to acquire or to hold or
to exercise effectively any rights of ownership in respect of shares or loans or
securities convertible into shares or any other securities (or the equivalent)
in any member of the Wider Essentially Group or the Wider Chime Group or to
exercise management control over any such member;
(iv) otherwise adversely affect the business, assets, profits or prospects of
any member of the Wider Chime Group or of any member of the Wider
Essentially Group in a manner which is adverse to and material in the context of
the Chime Group or the Essentially Group in either case taken as a whole;
(v) make the Offer or its implementation or the acquisition or proposed
acquisition by Chime or any member of the Wider Chime Group of any shares or
other securities in, or control of Essentially void, illegal, and/or
unenforceable under the laws of any jurisdiction, or otherwise, directly or
indirectly, restrain, restrict, prohibit, delay or otherwise materially
interfere with the same, or impose additional conditions or obligations with
respect thereto, or otherwise challenge or interfere therewith;
(vi) require any member of the Wider Chime Group or the Wider
Essentially Group to offer to acquire any shares or other securities (or the
equivalent) or interest in any member of the Wider Essentially Group or the
Wider Chime Group owned by any third party;
(vii) impose any limitation on the ability of any member of the Wider
Essentially Group to co-ordinate its business, or any part of it, with the
businesses of any other members which is adverse to and material in the context
of the group concerned taken as a whole; or
(viii) result in any member of the Wider Essentially Group ceasing to be able
to carry on business under any name under which it presently does so,
and all applicable waiting and other time periods during which any such Third
Party could institute, implement or threaten any action, proceeding, suit,
investigation, enquiry or reference or any other step under the laws of any
jurisdiction in respect of the Offer or the acquisition or proposed acquisition
of any Essentially Shares having expired, lapsed or been terminated;
(e) all necessary filings or applications having been made in connection with
the Offer and all statutory or regulatory obligations in any jurisdiction having
been complied with in connection with the Offer or the acquisition by any member
of the Wider Chime Group of any shares or other securities in, or control of,
Essentially and all authorisations, orders, recognitions, grants, consents,
licences, confirmations, clearances, permissions and approvals reasonably deemed
necessary or appropriate by Chime or any member of the Wider Chime Group for or
in respect of the Offer considered necessary or appropriate by Chime or any
member of the Wider Chime Group for or in respect of the Offer including without
limitation, its implementation and financing, or the proposed acquisition of any
shares or other securities in, or control of, Essentially by any member of the
Wider Chime Group having been obtained in terms and in a form
reasonably satisfactory to Chime from all appropriate Third Parties or persons
with whom any member of the Wider Essentially Group has entered into contractual
arrangements and all such authorisations, orders, recognitions, grants,
consents, licences, confirmations, clearances, permissions and approvals
together with all material authorisations orders, recognitions, grants,
licences, confirmations, clearances, permissions and approvals necessary or
appropriate to carry on the business of any member of the Wider Essentially
Group which is material in the context of the Chime Group or the Essentially
Group as a whole remaining in full force and effect and all filings necessary
for such purpose having been made and there being no notice or intimation of any
intention to revoke or not to renew any of the same at the time at which the
Offer becomes otherwise unconditional and all necessary statutory or regulatory
obligations in any jurisdiction having been complied with;
(f) except as publicly announced by Essentially in accordance with the
Listing Rules, Disclosure Rules or Transparency Rules prior to 21 September
2009, no member of the Wider Essentially Group having, since 31 December 2008:
(i) save as between Essentially and wholly-owned subsidiaries of Essentially
or for Essentially Shares issued pursuant to the exercise of options granted
under the Essentially Share Scheme, issued, authorised or proposed the issue of
additional shares of any class;
(ii) save as between Essentially and wholly-owned subsidiaries of Essentially
or for the grant of options under the Essentially Share Option Scheme, issued or
agreed to issue, authorised or proposed the issue of securities convertible into
shares of any class or rights, warrants or options to subscribe for, or acquire,
any such shares or convertible securities;
(iii) other than to another member of the Essentially Group, recommended,
declared, paid or made or proposed to recommend, declare, pay or make any bonus,
dividend or other distribution whether payable in cash or otherwise, save for
the Essentially Interim Dividend;
(iv) save for intra-Essentially Group transactions, merged or demerged with
any body corporate or acquired or disposed of or transferred, mortgaged or
charged or created any security interest over any assets or any right, title or
interest in any asset (including shares and trade investments) or authorised or
proposed or announced any intention to propose any merger, demerger, acquisition
or disposal, transfer, mortgage, charge or security interest, in each case,
other than in the ordinary course of business;
(v) save for intra-Essentially Group transactions, made or authorised or
proposed or announced an intention to propose any change in its loan capital;
(vi) issued, authorised or proposed the issue of any debentures or (save for
intra-Essentially Group transactions), save in the ordinary course of business,
incurred or increased any indebtedness or become subject to any contingent
liability;
(vii) purchased, redeemed or repaid or announced any proposal to purchase,
redeem or repay any of its own shares or other securities or reduced or, save in
respect to the matters mentioned in sub-paragraph (i) above, made any other
change to any part of its share capital;
(viii) implemented, or authorised, proposed or announced its intention to
implement, any reconstruction, amalgamation, scheme, commitment or other
transaction or arrangement otherwise than in the ordinary course of business or
entered into or changed the terms of any contract with any director or senior
executive;
(ix) entered into or varied or authorised, proposed or announced its
intention to enter into or vary any contract, transaction or commitment (whether
in respect of capital expenditure or otherwise) which is of a long term, onerous
or unusual nature or magnitude or which is or could be materially restrictive on
the businesses of any member of the Wider Essentially Group or the Wider
Chime Group or which involves or could involve an obligation of such a nature or
magnitude or which is other than in the ordinary course of business and which is
material in the context of the Wider Essentially Group taken as a whole;
(x) (other than in respect of a member which is dormant and was solvent at
the relevant time) taken any corporate action or had any legal proceedings
started or threatened against it for its winding-up, dissolution or
reorganisation or for the appointment of a receiver, administrative receiver,
administrator, trustee or similar officer of all or any of its assets or
revenues or any analogous proceedings in any jurisdiction or had any such person
appointed;
(xi) entered into any contract, transaction or arrangement which would be
restrictive on the business of any member of the Wider Essentially Group or the
Wider Chime Group other than to a nature and extent which is normal in the
context of the business concerned;
(xii) waived or compromised any claim otherwise than in the ordinary course
of business;
(xiii) entered into any contract, commitment, arrangement or agreement
otherwise than in the ordinary course of business or passed any resolution or
made any Offer (which remains open for acceptance) with respect to or announced
any intention to, or to propose to, effect any of the transactions, matters or
events referred to in this condition;
(xiv) having made or agreed or consented to any change to:
(1) the terms of the trust deeds constituting the pension scheme(s)
established by any member of the Wider Essentially Group for its directors,
employees or their dependents;
(2) the contributions payable to any such scheme(s) or to the benefits which
accrue or to the pensions which are payable thereunder;
(3) the basis on which qualification for, or accrual or entitlement to, such
benefits or pensions are calculated or determined; or
(4) the basis upon which the liabilities (including pensions) of such pension
schemes are funded, valued or made; or
(xv) proposed, agreed to provide or modified the terms of any share option
scheme, incentive scheme or other benefit relating to the employment or
termination of employment of any person employed by the Wider Essentially Group,
and, for the purposes of paragraphs (iii), (iv), (v) and (vi) of this condition,
the term "Essentially Group" shall mean Essentially and its wholly-owned
subsidiaries;
(g) except as disclosed in the accounts for the year ended on 31 December
2008 or where not material in the context of the Wider Essentially Group taken
as a whole:
(i)no adverse change or deterioration having occurred in the business, assets,
financial or trading position or profits or prospects of any member of the Wider
Essentially Group;
(ii) no litigation, arbitration proceedings, prosecution or other legal
proceedings to which any member of the Wider Essentially Group is or may become
a party (whether as a plaintiff, defendant or otherwise) and no investigation by
any Third Party against or in respect of any member of the Wider Essentially
Group having been instituted announced or threatened by or against or remaining
outstanding in respect of any member of the Wider Essentially Group which in any
such case might be expected to adversely affect any member of the Wider
Essentially Group;
(iii) no contingent or other liability having arisen or become apparent to
Chime which would be likely to adversely affect any member of the Wider
Essentially Group; and
(iv) no steps having been taken which are likely to result in the withdrawal,
cancellation, termination or modification of any licence held by any member of
the Wider Essentially Group which is necessary for the proper carrying on of its
business;
(h)Chime not having discovered:
(i) that any financial, business or other information concerning the Wider
Essentially Group as contained in the information publicly disclosed at any time
by or on behalf of any member of the Wider Essentially Group is materially
misleading, contains a misrepresentation of fact or omits to state a fact
necessary to make that information not misleading;
(ii) that any member of the Wider Essentially Group, partnership, company or
other entity in which any member of the Wider Essentially Group has a
significant economic interest and which is not a subsidiary undertaking of
Essentially is subject to any liability (contingent or otherwise) which is not
disclosed in the annual report and accounts of Essentially for the year ended 31
December 2008; or
(iii) any information which affects the import of any information disclosed
at any time by or on behalf of any member of the Wider Essentially Group and
which is material in the context of the Wider Essentially Group taken as a
whole;
(i)Chime not having discovered that:
(i) any past or present member of the Wider Essentially Group has failed to
comply with any and/or all applicable legislation or regulations of any
jurisdiction with regard to the disposal, spillage, release, discharge, leak or
emission of any waste or hazardous substance or any substance likely to impair
the environment or harm human health or animal health or otherwise relating to
environmental matters, or that there has otherwise been any such disposal,
spillage, release, discharge, 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) any of which disposal,
spillage, release, discharge, leak or emission would be likely to give rise to
any liability (actual or contingent) on the part of any member of the Wider
Essentially Group and which is material in the context of the Wider Essentially
Group taken as a whole; or
(ii) there is, or is likely to be, for that or any other reason whatsoever,
any liability (actual or contingent) of any past or present member of the Wider
Essentially Group to make good, repair, reinstate or clean up any property or
any controlled waters now or previously owned, occupied, operated or made use of
or controlled by any such past or present member of the Wider Essentially Group,
under any environmental legislation, regulation, notice, circular or order of
any government, governmental, quasi-governmental, state or local government,
supranational, statutory or other regulatory body, agency, court, association or
any other person or body in any jurisdiction and which is material in the
context of the Wider Essentially Group taken as a whole; and
(j) after the Offer shall have become or has been declared unconditional as
to acceptances, Essentially Shareholders who have accepted the Offer and become
entitled to withdraw their acceptances pursuant to Section 87Q of the Financial
Services and Markets Act 2000 not withdrawing their acceptances in respect of
such number of Essentially Shares so that the Essentially Shares acquired or
agreed to be acquired by Chime or any of its wholly-owned subsidiaries, either
pursuant to the Offer or otherwise, will result in Chime and any of its
subsidiaries holding Essentially Shares which together carry less than 90 per
cent. (or such lower percentage as Chime may decide) of the voting rights then
normally exercisable at general meeting of Essentially.
For the purposes of these conditions the "Wider Essentially Group" means
Essentially and its subsidiary undertakings, associated undertakings and any
other undertaking in which Essentially and/or such undertakings (aggregating
their interests) have a significant interest and the "Wider Chime Group" means
Chime and its subsidiary undertakings, associated undertakings and any other
undertaking in which Chime and/or such undertakings (aggregating their
interests) have a significant interest and for these purposes "subsidiary
undertaking" and "undertaking" have the meanings given by the Companies Act
2006, "associated undertaking" has the meaning given by paragraph 19 of Schedule
6 to the Large and Medium-sized Companies and Groups (Accounts and Reports)
Regulations 2008 other than paragraph 19(1)(b) of Schedule 6 to those
Regulations which shall be excluded for this purpose, and "significant interest"
means a direct or indirect interest in ten per cent. or more of the equity share
capital (as defined in the Companies Act 2006).
Chime reserves the right to waive, in whole or in part, all or any of conditions
(a) to (j) above, except for conditions (a) and (b).
The Offer will lapse unless all the above conditions are fulfilled or (if
capable of waiver) waived or, where appropriate, determined by Chime to have
been or remain satisfied by midnight (London time) on the day which is 21 days
after the later of the first closing date of the Offer and the date on which
condition (a) is fulfilled (or in each such case such later date as Chime may,
with the consent of the Panel, decide). Chime shall be under no obligation to
waive or treat as satisfied any of conditions (c) to (j) (inclusive) by a date
earlier than the latest date specified above for the satisfaction thereof,
notwithstanding that the other conditions of the offer may at such earlier date
have been waived or fulfilled and that there are at such earlier date no
circumstances indicating that any of such conditions may not be capable of
fulfilment.If Chime is required by the Panel to make an offer for Essentially
Shares under the provisions of Rule 9 of the City Code, Chime may make such
alterations to any of the above conditions as are necessary to comply with the
provisions of that Rule.
The Offer will lapse if it is referred to the Competition Commission before 3.00
p.m. on the first closing date of the Offer or the date on which the Offer
becomes or is declared unconditional as to acceptances, whichever is the later.
If the Offer does so lapse, not only will the Offer cease to be capable of
further acceptance but also Essentially Shareholders and Chime will cease to be
bound by prior acceptances.
Chime reserves the right to elect (with the consent of the Panel) to implement
the Offer by way of a scheme of arrangement as it may determine in its absolute
discretion. In such event, such offer will be implemented on the same terms, so
far as applicable, as those which would apply to the Offer, subject to
appropriate amendments.
The availability of the Offer to persons not resident in the United Kingdom may
be affected by the laws of the relevant jurisdictions. Persons who are not
resident in the United Kingdom should inform themselves about and observe any
applicable requirements.
This Offer will be governed by English law and be subject to the jurisdiction of
the English courts, to the conditions set out below and in the formal Offer
Document and, in respect of Essentially Shares held in certificated form, the
Form of Acceptance. The Offer will comply with the applicable rules and
regulations of the Financial Services Authority and the London Stock Exchange
and the City Code.
Part B: Certain further terms of the Offer
No fractions of New Chime Shares will be issued to holders of Essentially
Shares. Any fractional entitlements to New Chime Shares will be rounded up or
down to the nearest whole number (with fractional entitlements to 0.5 or more of
a New Chime Share being rounded up).
The Offer will not be made, directly or indirectly, in or into, or by use of the
mails of, or by any means or instrumentality (including, without limitation,
facsimile transmission, telex, telephone, internet or e-mail) of interstate or
foreign commerce of, or of any facility of a national securities exchange of,
the United States, Canada, Jersey, Japan or Australia or any other jurisdiction
where to do so would constitute a violation of the laws of that jurisdiction and
the Offer will not be capable of acceptance by any such use, means,
instrumentality or facility or from within any such jurisdiction.Chime reserves
the right to deem a shareholder resident in such jurisdictions to have elected
for a particular form of consideration, or to have made no election at all, or
to offer such shareholder cash only by way of consideration, in each case in
connection with the Offer or any compulsory acquisition procedures. Chime
further reserves the right to meet the cash consideration due to such
shareholders either from its own reserves or by arranging, as it thinks fit, the
sale or allotment of the shares to which such shareholders would otherwise be
entitled and then remitting the cash proceeds of such sale or allotment, net of
expenses, to such shareholders instead.
The New Chime Shares to be issued pursuant to the Offer have not been and will
not be registered under the US Securities Act nor under any of the relevant
securities laws of Canada, Jersey, Japan or Australia. Accordingly, the New
Chime Shares may not be offered, sold or delivered, directly or indirectly, in
the United States, Canada, Jersey, Japan or Australia nor to any United States
person, except pursuant to exemptions from applicable requirements of any such
jurisdiction.
The New Chime Shares will be issued credited as fully paid and will rank pari
passu in all respects with the existing Chime Shares. Applications will be made
to the UKLA for the New Chime Shares to be admitted to the Official List and to
the London Stock Exchange for the New Chime Shares to be admitted to trading.
Essentially Shares which will be acquired under the Offer will be acquired fully
paid and free from all liens, equities, charges, encumbrances, options, rights
of pre-emption and any other third party rights and interests of any nature and
together with all rights now or hereafter attaching or accruing to them,
including voting rights and the right to receive and retain in full all
dividends and other distributions (if any) declared, made or paid on or after
the date of this announcement other than the Essentially Interim Dividend.
APPENDIX II
SOURCES OF INFORMATION AND BASES OF CALCULATION
In this announcement:
1. Unless otherwise stated:
* financial information relating to the Chime Group has been extracted or derived
(without any adjustment) from the audited annual report and accounts for
Chime for the year ended 31 December 2008 and Chime's announcement dated 25
August 2009 of its interim results for the six months ended 30 June 2009 (which
are unaudited); and
* financial information relating to the Essentially Group has been extracted or
derived (without any adjustment) from the audited annual report and accounts for
Essentially for the year ended 31 December 2008 and Essentially's announcement
dated 22 September 2009 of its interim results for the six months ended 30 June
2009 (which are unaudited).
2. The value of the Offer is calculated:
* by reference of the price of 177.75 pence per Chime Share, being the Closing
Price on 21 September 2009, the last Business Day prior to this announcement;
and
* on the basis of the fully diluted number of Essentially Shares in issue referred
to in paragraph 3 below.
3.As at the close of business on 21 September 2009, being the last Business Day
prior to the date of this announcement, Essentially had in issue
225,675,535 Essentially Shares and Chime had in issue 57,061,900 Chime Shares.
The International Securities Identification Number for Essentially Shares is
GB0032118878 and for Chime Shares is GB00B2QY9355.
4. Unless otherwise stated, all prices and Closing Prices for Essentially
Shares and Chime Shares are closing middle market quotations derived from the
London Stock Exchange.
5. The premium calculations to the price per Essentially Share have been
calculated by reference to:
* a price of 4 pence per Essentially Share, being the Closing Price on
21 August 2009, the last Business Day prior to Essentially announcing that it
was in discussions regarding a potential offer; and
* a price of 7.5 pence per Essentially Share, being the Closing Price on 21
September 2009, the last Business Day prior to this announcement.
APPENDIX III
SCHEDULE OF IRREVOCABLE UNDERTAKINGS AND LETTERS OF INTENT
Details of the irrevocable undertakings provided to Chime to accept the Offer
are as follows:
+-----------------------+----------------------+-------------+----------------+
| Party | Beneficial Owner | Number of | Percentage of |
| | (if different to the | Essentially | Essentially |
| | party to the | Shares | issued share |
| | irrevocable | | capital |
| | undertaking) | | |
+-----------------------+----------------------+-------------+----------------+
| Kalihi Trust | Warren Alcock | 3,932,324 | 1.75 |
+-----------------------+----------------------+-------------+----------------+
| Tim Berg | | 1,485,583 | 0.66 |
+-----------------------+----------------------+-------------+----------------+
| Richard Battersby | | 787,653 | 0.35 |
+-----------------------+----------------------+-------------+----------------+
| James Butterfield | | 250,000 | 0.11 |
+-----------------------+----------------------+-------------+----------------+
| Cenkos Channel | John Byfield | 290,909 | 0.13 |
| Islands Nominees | | | |
| Company Limited | | | |
+-----------------------+----------------------+-------------+----------------+
| Pershing Nominees | John Byfield1 | 31,450,063 | 13.94 |
| PSL981 | | | |
+-----------------------+----------------------+-------------+----------------+
| Bart Campbell | | 8,082,894 | 3.58 |
+-----------------------+----------------------+-------------+----------------+
| Ian Childs | | 4,676,910 | 2.07 |
+-----------------------+----------------------+-------------+----------------+
| Vasco Gomes | | 6,052,470 | 2.68 |
+-----------------------+----------------------+-------------+----------------+
| Chris Jones | | 6,602,694 | 2.93 |
+-----------------------+----------------------+-------------+----------------+
| David Ligertwood | | 7,987,181 | 3.54 |
+-----------------------+----------------------+-------------+----------------+
| Mike Lilley | | 4,676,910 | 2.07 |
+-----------------------+----------------------+-------------+----------------+
| Dwight Mighty | | 573,636 | 0.25 |
+-----------------------+----------------------+-------------+----------------+
| Allan Reeves | | 3,530,097 | 1.56 |
+-----------------------+----------------------+-------------+----------------+
| Waimoana City Trust | Lewis Thompson | 3,934,970 | 1.74 |
+-----------------------+----------------------+-------------+----------------+
| Kevin Vandrau | | 2,820,927 | 1.25 |
+-----------------------+----------------------+-------------+----------------+
| Matthew Vandrau | | 2,820,928 | 1.25 |
+-----------------------+----------------------+-------------+----------------+
| Total | | 89,956,148 | 39.86 |
+-----------------------+----------------------+-------------+----------------+
1 John Byfield is a beneficiary of the discretionary trust which holds these
shares.
Details of the non-binding letters of intent provided to Chime to accept the
Offer are as follows:
+------------------------------------------+----------------+----------------+
| Party | Number of | Percentage of |
| | Essentially | Essentially |
| | Shares | issued share |
| | | capital |
+------------------------------------------+----------------+----------------+
| AXA Framlington, the judgemental equity | 8,470,139 | 3.75 |
| division of AXA Investment Managers UK | | |
| Limited | | |
+------------------------------------------+----------------+----------------+
| Bluehone Investors LLP | 4,492,892 | 1.76 |
+------------------------------------------+----------------+----------------+
| Octopus Investments Limited | 7,905,305 | 3.50 |
+------------------------------------------+----------------+----------------+
| Rensburg AIM VCT plc2 | 7,136,806 | 3.16 |
+------------------------------------------+----------------+----------------+
| Total | 28,005,142 | 12.41 |
+------------------------------------------+----------------+----------------+
2 Rensburg AIM VCT plc has confirmed its intention to accept the Offer, provided
a higher offer is not forthcoming during the Offer Period.
APPENDIX IV
DEFINITIONS
In this announcement, the following definitions apply unless the context
requires otherwise:
+--------------------------+-----------------------------------------------+
| "Acquisition" | means the proposed acquisition by Chime of |
| | the entire issued and to be issued ordinary |
| | share capital of Essentially to be |
| | implemented by means of the Offer, or, if |
| | Chime so determines in its absolute |
| | discretion, by means of the Scheme; |
+--------------------------+-----------------------------------------------+
| "AIM" | means the AIM Market of the London Stock |
| | Exchange; |
+--------------------------+-----------------------------------------------+
| "Alternative Proposal" | means an offer or possible offer or proposal |
| | put forward by any Third Party which is not |
| | acting in concert with Chime in respect of, |
| | or for all or a significant proportion (being |
| | in excess of 25 per cent. when aggregated |
| | with shares already held by the Third Party |
| | and anyone acting in concert (as defined in |
| | the City Code) with it) of, the entire issued |
| | and to be issued share capital of Essentially |
| | or the sale or possible sale of the whole or |
| | any substantial part of the assets of the |
| | Essentially Group or a transaction which is |
| | otherwise inconsistent with the Offer |
| | becoming Effective, in each case howsoever it |
| | is proposed that such offer, proposal or |
| | transaction be implemented (whether legally |
| | binding or not and whether or not |
| | pre-conditional); |
+--------------------------+-----------------------------------------------+
| "Australia" | means the Commonwealth of Australia, its |
| | territories and possessions and all areas |
| | subject to its jurisdiction and any political |
| | sub-division thereof; |
+--------------------------+-----------------------------------------------+
| "Business Day" | means any day (other than a Saturday or |
| | Sunday) on which banks generally are open for |
| | business in London (other than solely for |
| | settlement and trading in euro); |
+--------------------------+-----------------------------------------------+
| "Canada" | means Canada, its provinces and territories |
| | and all areas subject to its jurisdiction or |
| | any political sub-division thereof; |
+--------------------------+-----------------------------------------------+
| "Cenkos" | means Cenkos Securities plc; |
+--------------------------+-----------------------------------------------+
| "certificated" or "in | means recorded on the relevant register of |
| certificated form" | the relevant company as being held in |
| | certificated form and title to which may be |
| | transferred by means of a stock transfer |
| | form; |
+--------------------------+-----------------------------------------------+
| "Chime" | means Chime Communications plc, a public |
| | limited company registered in Essentially and |
| | Wales (no. 01983857); |
+--------------------------+-----------------------------------------------+
| "Chime Board" or "Chime | means the board of directors of Chime; |
| Board of Directors" | |
+--------------------------+-----------------------------------------------+
| "Chime Directors" or | means the directors of Chime, and "Chime |
| "Directors of Chime" | Director" means any one of them; |
+--------------------------+-----------------------------------------------+
| "Chime Interim Dividend" | means the interim dividend of 1.60 pence per |
| | Chime Share announced by Chime on 25 August |
| | 2009; |
+--------------------------+-----------------------------------------------+
| "Chime Group" | means Chime and its subsidiary undertakings; |
+--------------------------+-----------------------------------------------+
| "Chime Shareholders" | means the holders of Chime Shares; |
+--------------------------+-----------------------------------------------+
| "Chime Shares" | means ordinary shares of 25 pence each in the |
| | capital of Chime (including, if the context |
| | requires, the New Chime Shares); |
+--------------------------+-----------------------------------------------+
| "City Code" | means the City Code on Takeovers and Mergers |
| | of the United Kingdom; |
+--------------------------+-----------------------------------------------+
| "Closing Price" | means the closing middle market price of a |
| | relevant share in pounds sterling as |
| | published in the Official List of the London |
| | Stock Exchange; |
+--------------------------+-----------------------------------------------+
| "EEA State" | means a Member State of the European Economic |
| | Area, being the European Union, Iceland, |
| | Norway and Liechtenstein; |
+--------------------------+-----------------------------------------------+
| "Effective" | means in the context of the Acquisition, when |
| | the Offer has been declared or has become |
| | unconditional in all respects in accordance |
| | with the requirements of the City Code; |
+--------------------------+-----------------------------------------------+
| "Effective Date" | means the date on which the Acquisition |
| | becomes Effective; |
+--------------------------+-----------------------------------------------+
| "Enlarged Group" | means the Chime Group including the |
| | Essentially Group following the Effective |
| | Date; |
+--------------------------+-----------------------------------------------+
| "EPL Advisory" | means EPL Advisory LLP; |
+--------------------------+-----------------------------------------------+
| "Essentially" | means Essentially Group Limited; |
+--------------------------+-----------------------------------------------+
| "Essentially Board" | means the board of directors of Essentially; |
+--------------------------+-----------------------------------------------+
| "Essentially Directors" | means the directors of Essentially, and |
| or "Directors of | "Essentially Director" means any one of |
| Essentially" | them; |
+--------------------------+-----------------------------------------------+
| "Essentially Group" | means Essentially and its subsidiaries and |
| | subsidiary undertakings at the relevant time; |
+--------------------------+-----------------------------------------------+
| "Essentially Interim | means the interim dividend of 0.36 pence per |
| Dividend" | Essentially Share announced by the |
| | Essentially Directors on the date of this |
| | announcement; |
+--------------------------+-----------------------------------------------+
| "Essentially | means holders of Essentially Shares; |
| Shareholders" | |
+--------------------------+-----------------------------------------------+
| "Essentially Shares" | means ordinary shares of 0.1 pence each in |
| | the capital of Essentially; |
+--------------------------+-----------------------------------------------+
| "Essentially Share | means the Essentially Group Share Option |
| Scheme" | Plan; |
+--------------------------+-----------------------------------------------+
| "Exclusivity Period" | means the period which commences on |
| | 21 September 2009 and continues until the |
| | earlier of the date when Chime's Offer lapses |
| | or is withdrawn or the date on which the |
| | Offer becomes or is declared unconditional as |
| | to acceptances; |
+--------------------------+-----------------------------------------------+
| "Financial Services | means the UK Financial Services Authority; |
| Authority" | |
+--------------------------+-----------------------------------------------+
| "Form of Acceptance" | means the form of acceptance relating to the |
| | Offer which will accompany the Offer |
| | Document; |
+--------------------------+-----------------------------------------------+
| "FSMA" | means the Financial Services and Markets Act |
| | 2000, as amended; |
+--------------------------+-----------------------------------------------+
| "Japan" | means Japan, its cities, prefectures, |
| | territories and possessions; |
+--------------------------+-----------------------------------------------+
| "Jersey" | means the island of Jersey and its |
| | dependencies; |
+--------------------------+-----------------------------------------------+
| "Listing Rules" | means the listing rules of the UKLA; |
+--------------------------+-----------------------------------------------+
| "London Stock Exchange" | means London Stock Exchange plc or its |
| | successor(s); |
+--------------------------+-----------------------------------------------+
| "London time" | means Greenwich Mean Time (GMT time) or when |
| | applicable British Summer Time (BST time); |
+--------------------------+-----------------------------------------------+
| "Management Incentive | means the incentive scheme being offered to |
| Scheme" | certain members of Essentially management; |
+--------------------------+-----------------------------------------------+
| "New Chime Shares" | means Chime Shares proposed to be issued |
| | fully paid to Essentially Shareholders |
| | pursuant to the Offer; |
+--------------------------+-----------------------------------------------+
| "Numis" | means Numis Securities Limited with |
| | registered address 10 Paternoster Square, |
| | London EC4M 7LT; |
+--------------------------+-----------------------------------------------+
| "Offer" | means the recommended offer to be made by |
| | Chime to acquire the entire issued and to be |
| | issued ordinary share capital of Essentially |
| | and, where the context admits, any subsequent |
| | revision, variation, extension or renewal of |
| | such offer; |
+--------------------------+-----------------------------------------------+
| "Offer Document" | means the document to be sent to Essentially |
| | Shareholders which will include, inter alia, |
| | the terms and conditions of the Offer; |
+--------------------------+-----------------------------------------------+
| "Official List" | means the list maintained by the UK Listing |
| | Authority in accordance with section 74(1) of |
| | FSMA for the purposes of Part VI of FSMA, or |
| | any corresponding list maintained by a |
| | competent authority for listing in another |
| | EEA State; |
+--------------------------+-----------------------------------------------+
| "Overseas Shareholders" | means Essentially Shareholders who are |
| | resident in, ordinarily resident in, or |
| | citizens of, jurisdictions outside the United |
| | Kingdom (including where the context |
| | requires, US Persons) and persons acting on a |
| | non-discretionary basis (as agent, or |
| | nominee, custodian, trustees or otherwise) |
| | for or on behalf of such persons; |
+--------------------------+-----------------------------------------------+
| "Panel" | means the United Kingdom Panel on Takeovers |
| | and Mergers; |
+--------------------------+-----------------------------------------------+
| "Pounds", "GBP", "pounds | means the lawful currency of the United |
| sterling", "sterling", | Kingdom; |
| "p" and "pence" | |
+--------------------------+-----------------------------------------------+
| "Prospectus" | means a prospectus under the Prospectus Rules |
| | to be issued by Chime containing information |
| | on Chime and the New Chime Shares; |
+--------------------------+-----------------------------------------------+
| "Prospectus Rules" | means the Prospectus Rules made by the UK |
| | Listing Authority acting under Part VI of |
| | FSMA (as set out in the FSA handbook), as |
| | amended from time to time; |
+--------------------------+-----------------------------------------------+
| "Scheme" | means, should the Acquisition be implemented |
| | by way of a scheme, a scheme of arrangement |
| | under Article 125 of the Companies (Jersey) |
| | Law 1991 (as amended) between Essentially |
| | and holders of Essentially Shares with or |
| | subject to any modification, addition or |
| | condition approved or imposed by the Royal |
| | Court of Jersey; |
+--------------------------+-----------------------------------------------+
| "subsidiary" | has the meaning given in section 1159 of the |
| | Companies Act 2006; |
+--------------------------+-----------------------------------------------+
| "subsidiary undertaking" | has the meaning given in section 1162 of the |
| | Companies Act 2006; |
+--------------------------+-----------------------------------------------+
| "Third Party" | means any |
| | party or |
| | parties |
| | other than |
| | Chime; |
+--------------------------+-----------------------------------------------+
| "UKLA" or "UK Listing | means the UK Listing Authority, being the |
| Authority" | Financial Services Authority acting in its |
| | capacity as the competent authority for the |
| | purposes of Part IV of FSMA; |
+--------------------------+-----------------------------------------------+
| "United Kingdom" or "UK" | means the United Kingdom of Great Britain and |
| | Northern Ireland; |
+--------------------------+-----------------------------------------------+
| "United States" or "US" | means the United States of America, its |
| | territories and possessions, any State of the |
| | United States of America and the District of |
| | Columbia; |
+--------------------------+-----------------------------------------------+
| "US Persons" | means Essentially Shareholders that have a |
| | registered address in the United States and |
| | beneficial owners of Essentially Shares that |
| | are natural persons, resident in or that are |
| | legal persons organised under the laws of the |
| | United States; and |
+--------------------------+-----------------------------------------------+
| "US Securities Act" | means the US Securities Act of 1933, as |
| | amended from time to time, and the rules and |
| | regulations promulgated thereunder. |
+--------------------------+-----------------------------------------------+
Unless otherwise stated, all times referred to in this announcement are
references to London time.
Any reference to any provision of any legislation shall include any amendment,
modification, re-enactment or extension thereof.
Words importing the singular shall include the plural and vice versa, and words
importing the masculine gender shall include the feminine or neutral gender.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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