RNS Number:6862D
European Forest Resources Acq Ltd
11 September 2007
Not for release, publication or distribution, in whole or in part, in or into
the United States, Canada, Australia or Japan.
FOR IMMEDIATE RELEASE
11 September 2007
Cash offer
by
European Forest Resources Acquisition Limited
for
Highland Timber P.L.C.
Summary
* The Board of European Forest Resources Acquisition Limited (the "Offeror")
today announces the terms of a cash offer (the "Offer") to be made by the
Offeror for the entire issued and to be issued ordinary share capital of
Highland Timber P.L.C. (the "Target" and the "Target Shares").
* The Offer will be 120 pence per Target Share in cash and values the issued
and to be issued share capital of the Target at approximately #14.8 million.
* The Offer represents:
(i) a premium of approximately 40 per cent. to the average Closing Price of
85.5 pence per Target Share in the six months preceding 19 June 2007, the
business day prior to the commencement of the Offer Period;
(ii) a premium of approximately 20.6 per cent. over the Closing Price of 99.5
pence per Target Share on 19 June 2007; and
(iii) a premium of approximately 17.6 per cent. over the Closing Price of 102
pence per Target Share on 10 September 2007, the business day immediately prior
to this announcement.
* The Offeror has an interest in acquiring UK forestry assets as part of its
long-term business plan and originally made an offer to acquire the Target's
forestry assets (the "Forests"). At the Target EGM held on 26 June 2007 the
Board's proposal to dispose of the Forests to FIM Timber Growth Fund IV ("FIM")
was not approved by the Target Shareholders and the Offeror then entered into
discussions with the Board of the Target about a recommended cash offer at an
indicative 110 pence per share, which would have given the Target Shareholders
the liquidity which the FIM offer did not provide.
* On 27 July 2007 the Target informed the Offeror that it had received an
improved conditional offer for the Forests from FIM in an amount of #12.5
million. The Offeror responded with an upward revision of its own indicative
offer for the entire share capital to 115 pence per Target Share, which the
Board of the Target indicated that they were minded to recommend to the Target
Shareholders and to accept irrevocably (in the absence of a materially higher
offer) in relation to their own holdings amounting to 36.4% of the outstanding
share capital of the Target. From that date until Friday 24 August 2007 the
Offeror and the Target and their respective advisers were engaged in finalising
and documenting the Offeror's recommended cash offer with a view to the offer
being announced by no later than 30 August 2007.
* In the event, without informing the Offeror, the Board of the Target pre-
empted the announcement of the proposed recommended cash offer for the Target by
announcing on 24 August 2007 that it had now accepted the #12.5 million offer
from FIM for the Forests and had given irrevocable undertakings to vote in
favour of a resolution to approve the disposal of the Forests at the EGM which
has now been called on 20 September 2007.
* The Offeror is surprised and disappointed by this sudden change of approach
by the Board of the Target for which it never received a satisfactory
explanation. The Offeror continues to believe that the Target Shareholders
would welcome an opportunity to receive cash for their Shares and notes that the
comments made by the Board of the Target on the subject of liquidity for the
Target Shareholders fall far short of a commitment to return all capital to
Shareholders within a specified timeframe. The Offeror believes that the Target
Shareholders would prefer liquidity now to the alternative being proposed by the
Board of the Target, which is that the Target Shareholders should continue to
hold shares in a shell company with an uncertain future and no business assets.
* With the support of a number of the Target Shareholders, who have given
irrevocable undertakings to accept the Offer in respect of 2,198,499 Target
Shares representing 18.68 per cent. of the outstanding share capital of the
Target, and have agreed to vote against the resolution to approve the FIM Offer
at the EGM to be held on 20 September 2007, the Offeror has therefore decided to
pursue its offer without the previously proposed recommendation of the Board of
the Target. The Offeror believes that the Offer provides immediate liquidity to
the Target Shareholders at an attractive price, while enabling it to pursue its
long term business plan in relation to UK forestry assets. It is therefore a
condition of the Offer that (i) the resolution to approve the FIM Offer is
defeated; and (ii) that none of the individual forests comprising the Forests is
sold or otherwise materially encumbered, or their value materially impaired,
prior to the Offer becoming or being declared unconditional in all respects.
* The Offer will be capable of being declared unconditional as to acceptances
at any level above 50 per cent. acceptance.
Commenting on the Offer, Lawrence Caperton, Director of the Offeror said:
"The acquisition of the Target represents an important strategic step in our
long-term business plan. We believe the Offer represents an excellent price for
the Target Shares and, importantly, offers a certain and immediate cash exit for
the Target's Shareholders, in contrast to the FIM Offer which leaves the Target
Shareholders invested in a cash shell."
Enquiries:
European Forest Resources Acquisition Limited
William Straker-Nesbit +44 20 7596 1000
Auden Capital LLP
Piers von Simson +44 20 3008 8830
This summary should be read in conjunction with the full text of the following
announcement. The conditions and certain further terms of the Offer are set out
in Appendix I to this announcement. Appendix II contains the definitions of
certain terms used in this announcement.
Auden Capital LLP is an appointed representative of Mirabella Financial Services
LLP, which is authorised and regulated in the United Kingdom by the Financial
Services Authority, and is acting for the Offeror and no-one else in connection
with the Offer and will not be responsible to anyone other than the Offeror for
providing the protections afforded to clients of Auden Capital LLP or for
providing advice in relation to the Offer, or the contents of this announcement
or any matter referred to herein.
The Offer will not be made, directly or indirectly, in or into, or by the use of
the mails or any means of instrumentality (including, without limitation,
telephonically or electronically) of interstate or foreign commerce of, or any
facilities of a national securities exchange of the United States, Canada,
Australia or Japan. Accordingly, except as required by applicable law, copies
of this announcement are not being, and may not be, mailed or otherwise
forwarded, distributed or sent in, into or from the United States, Canada,
Australia or Japan. Persons receiving this announcement (including without
limitation nominees, trustees or custodians) must not forward, distribute or
send it into the United States, Canada, Australia or Japan.
The availability of the Offer to the Target Shareholders who are not resident in
the United Kingdom may be affected by the laws of the relevant jurisdictions.
In particular, the Offer will not be made directly or indirectly into the United
States, Canada, Australia or Japan. Shareholders who are not resident in the
United Kingdom should inform themselves about and observe any applicable
requirements.
This announcement does not constitute, or form any part of, any offer for, or
solicitation of any offer for, securities. Any acceptance or other response to
the Offer should be made on the basis of the information contained in the Offer
Document and the Form of Acceptance.
Rule 8 Notice
Under the provisions of Rule 8.3 of the Code, if any person is, or becomes,
"interested" (directly or indirectly) in 1% or more of any class of "relevant
securities" of the Target, all "dealings" in any "relevant securities" of the
Target (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 pm (London time) 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 the
Target, 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 Code, all "dealings" in "relevant
securities" of the Target by the Offeror or the Target, or by any of their
respective "associates", must be disclosed by no later than 12.00 noon (London
time) 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 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.
Not for release, publication or distribution, in whole or in part, in or into
the United States, Canada, Australia or Japan.
FOR IMMEDIATE RELEASE
11 September 2007
Cash offer
by
European Forest Resources Acquisition Limited
for
Highland Timber P.L.C.
1. Introduction
The Board of European Resources Acquisition Limited (the "Offeror") today
announces the terms of a cash offer (the "Offer") to be made by the Offeror for
the entire issued and to be issued ordinary share capital of Highland Timber
P.L.C. (the "Target" and the "Target Shares").
The Offeror has received irrevocable undertakings from certain Target
Shareholders to accept (or procure the acceptance of) the Offer in respect of,
in aggregate, 2,198,499 Target Shares, representing approximately 18.68 per
cent. of the issued share capital of the Target.
2. The Offer
The Offer, which will be subject to the conditions and further terms set out in
Appendix I to this announcement and to the full terms and conditions to be set
out in the Offer Document and the Form of Acceptance, will be made on the
following basis:
for each Target Share 120 pence in cash
The Offer values the issued and to be issued share capital of the Target at
approximately #14.8 million.
The Offer represents:
(i) a premium of approximately 40 per cent. to the average Closing Price of
85.5 pence per Target Share in the six months preceding 19 June 2007, the
business day prior to the commencement of the Offer Period;
(ii) a premium of approximately 20.6 per cent. over the Closing Price of 99.5
pence per Target Share on 19 June 2007, the business day prior to the
commencement of the Offer Period; and
(iii)a premium of approximately 17.6 per cent. to the Closing Price of 102 pence
per Target Share on 10 September 2007, the business day immediately prior to
this announcement.
The Target Shares will be acquired under the Offer fully paid and free from all
liens, equities, charges, encumbrances and other interests and together with all
rights attaching to them on or after the date of this announcement, including
the right to receive all dividends (if any) declared, made or paid on or after
the date of this announcement.
3. Irrevocable undertakings
The Offeror has received irrevocable undertakings from certain Target
Shareholders to accept the Offer in respect of, in aggregate 2,198,499 Target
Shares, representing 18.68 per cent of the Target's issued share capital.
Details of irrevocable undertakings obtained by the Offeror are set out in the
following table:
Target Shareholder providing the irrevocable undertaking Number of Target Shares held
Rathbone Nominees Limited (clients of Rathbone Investment 874,333
Management Limited)
Adam & Co. Nominees Limited (clients of Troy Asset Management 416,666
Limited)
Roy Nominees Limited (clients of Ruffer LLP) 415,500
Stockinvest Limited 242,000
Rulegale Nominees Limited and other clients of James Sharp & Co. 205,000
Ferlim Nominees Limited (clients of Rensburg Sheppards Investment 45,000
Management Limited)
These undertakings will cease to be binding only if the Offer lapses or is
withdrawn or if, at any time, before midnight on the fifth day after the date of
despatch of the Offer Document:
(a) an announcement is made by a third party of a firm intention to make
an offer for all of the Target Shares at a price equal to or greater than 132
pence per Target Share; or
(b) an offer for the Forests is received by the Target and notified to
the Offeror with a proposed price of #13,750,000 or more which, if accepted,
creates a legally binding contract;
unless within seven Business Days the Offeror announces a firm intention to make
a revised offer for all of the Target Shares not already owned by it (or by
persons acting in concert with it) for an improved consideration to that
available under the offer falling within (a) or (b) above.
4. Information relating to the Offeror
The ultimate holding company of the Offeror is Louis Dreyfus SAS, which is the
principal holding company within the Offeror Group and was founded in France in
1851. The Offeror Group is present in over 55 countries, with major offices in
Beijing, Buenos Aires, Geneva, London, Paris, Sao Paulo, Singapore, Wilton
(Connecticut), Memphis (Tennessee) and Houston (Texas). Aggregate average
annual gross sales of the Offeror Group in recent years have exceeded US$25
billion. The Offeror Group is active in the growing, marketing and trading of
agricultural commodities (including grains, oilseeds, rice, sugar, coffee,
cotton and citrus fruits), the merchandising, trading, storage and transport of
natural gas, natural gas liquids, refined products, coal, plastic resins and
other petrochemicals, the production and trading of biofuels, the trading of
electricity, shipping (including the trading of ocean freight),
telecommunications and owning, developing and managing real estate.
5. Information relating to the Target
The Target Shares are admitted to trading on AIM. The Target owns five forests
in the UK, namely Myredykes, Corlae, Coed Ty Glas, Rhyd Y Felin and Nant Y
Cerdin (the "Forests"), which together represent the entirety of the Target's
non-cash assets. For the year ended 31 December 2006, the Target's audited
turnover was #273,000 and its audited operating profit was #577,000 after the
reversal of previous impairment of forests amounting to #728,000. As at 30 June
2007, the Target had net assets of #8.631 million of which #2.523 million were
cash balances.
6. Background to and reasons for the Offer
The Offeror has an interest in acquiring UK forestry assets as part of its
long-term business plan and originally made an offer to acquire the Forests. At
the Target EGM held on 26 June 2007 the Board's proposal to dispose of the
Forests to FIM Timber Growth Fund IV ("FIM") was not approved by the Target
Shareholders and the Offeror then entered into discussions with the Target Board
about a recommended cash offer at an indicative 110 pence per share, which would
have given the Target Shareholders the liquidity which the FIM offer did not
provide.
On 27 July 2007 the Target informed the Offeror that it had received an improved
conditional offer for the Forests from FIM in an amount of #12.5 million. The
Offeror responded with an upward revision of its own indicative offer for the
entire share capital to 115 pence per Target Share which the Board of the Target
indicated that they were minded to recommend to the Target Shareholders and to
accept irrevocably (in the absence of a materially higher offer) in relation to
their own holdings amounting to 36.4% of the outstanding share capital of the
Target. From that date until Friday 24 August 2007 the Offeror and the Target
and their respective advisers were engaged in finalising and documenting the
Offeror's recommended cash offer with a view to the offer being announced by no
later than 30 August 2007.
In the event, without informing the Offeror, the Board of the Target pre-empted
the announcement of the proposed recommended cash offer for the Target by
announcing on 24 August 2007 that it had now accepted the #12.5 million offer
from FIM for the Forests and had given irrevocable undertakings to vote in
favour of a resolution to approve the disposal of the Forests at the EGM which
has now been called on 20 September 2007.
The Offeror is surprised and disappointed by this sudden change of approach by
the Board of the Target for which it never received a satisfactory explanation.
The Offeror continues to believe that the Target Shareholders would welcome an
opportunity to receive cash for their Shares and notes that the comments made by
the Board of the Target on the subject of liquidity for the Target Shareholders
fall far short of a commitment to return all capital to Shareholders within a
specified timeframe. The Offeror believes that the Target Shareholders would
prefer liquidity now to the alternative being proposed by the Board of the
Target, which is that the Target Shareholders should continue to hold shares in
a shell company with an uncertain future and no business assets.
With the support of a number of Target Shareholders, who have given irrevocable
undertakings to accept the Offer in respect of 2,198,499 Target Shares
representing 18.68 per cent. of the outstanding share capital of the Target, and
have agreed to vote against the resolution to approve the FIM Offer at the EGM
to be held on 20 September 2007, the Offeror has therefore decided to pursue its
offer without the previously proposed recommendation of the Board of the Target.
The Offeror believes that the Offer provides immediate liquidity to the Target
Shareholders at an attractive price, while enabling it to pursue its long term
business plan in relation to UK forestry assets.
7. Financing arrangements
The Offeror is a wholly owned indirect subsidiary of European Forest Resources
Limited, a limited company incorporated in Guernsey with a share capital of
Euro29,500,000. The Offeror will fund its cash purchase of the Target Shares under
the terms of the Offer with the proceeds of a loan from its immediate holding
company, European Forest Resources (U.K.) S.a r.l., (the "S.a r.l") a limited
company incorporated in Luxembourg. An amount sufficient to purchase 100 per
cent. of the Target Shares has been deposited by the S.a r.l in an escrow
account with Citibank N.A., London Branch, and such funds may not be withdrawn
for any reason other than to pay selling shareholders or to return the funds to
the Offeror if the Offer lapses or is withdrawn.
Auden Capital LLP is satisfied that the Offeror has the necessary financial
resources available to satisfy full acceptance of the Offer. Full acceptances
of the Offer would involve a maximum cash payment of approximately #14.8
million.
8. The Target Share options
The Offer will extend to any Shares issued or unconditionally allotted, and any
Treasury Shares unconditionally sold or transferred by the Target, in each case,
prior to the date on which the Offer closes (or such earlier date as the Offeror
may, subject to the Code, decide) as a result of the exercise of options granted
over the Shares. In the event that the Offer becomes or is declared
unconditional in all respects, it is intended that appropriate proposals will be
made to holders of options over Shares.
9. Disclosure of interests in Shares
The Offeror is the registered holder of 500 Target Shares, originally acquired
by an associated company at a price of 102 pence per Target Share on 31 May
2007.
Save as disclosed herein, neither the Offeror, nor any of its Directors, nor to
the best of the Offeror's knowledge and belief, any person acting in concert
with the Offeror is interested in or has any rights to subscribe for any Target
Shares or has borrowed or lent any Target Shares nor does any such person have
any short position whether conditional or absolute and whether in the money or
otherwise (including a short position under a derivative) or any arrangement in
relation to the Target Shares. For these purposes "interest" includes any long
economic exposure, whether conditional or absolute, to changes in the price of
securities and a person is 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 and "arrangement" includes any agreement to
sell or any delivery obligation or right to require another person to purchase
or take delivery of the Target Shares and also includes any indemnity or option
arrangement, any agreement or understanding, formal or informal, of whatever
nature relating to the Target Shares which may be an inducement to deal or
refrain from dealing in such securities.
10. Further details of the Offer
The Offeror is aware that the Board of the Target announced on 24 August 2007
that it had entered into a conditional contract to sell the Forests to FIM.
This contract is conditional upon the Target Shareholders approving the terms of
the acquisition at an extraordinary general meeting. The Offeror places a
significant premium on the Forests as a package. The Offeror considers that the
value of the Shares would, accordingly, be significantly lower if the Target
sold the Forests or any of the individual forests which together comprise the
Forests prior to the Offer being completed. Accordingly, it is a condition to
the Offer that (i) the resolution to approve the FIM Offer is defeated; and (ii)
that none of the individual forests comprising the Forests are sold or otherwise
materially encumbered, or their value materially impaired, prior to the Offer
becoming or being declared unconditional in all respects.
11. Compulsory acquisition, de-listing and cancellation of trading
It is understood that if the Offeror receives acceptances under the Offer in
respect of, and/or otherwise acquires, 90 per cent. or more of the Target Shares
to which the Offer relates, the Offeror will be entitled to exercise its rights
pursuant to the provisions of sections (974 to 991 of the Companies Act 2006) to
acquire compulsorily any remaining Target Shares on the same terms as the Offer.
In the event that the Offer is declared unconditional in all respects, the
Offeror reserves the right, but shall not be obliged, to seek a resolution
consenting to the cancellation of trading on AIM. The trading of the Target
Shares on AIM may be cancelled with the consent of shareholders representing at
least 75 per cent. of the Target's issued share capital. Cancellation may
therefore take effect notwithstanding that the Offeror may not be able to invoke
the provisions of the Companies Act 2006 to acquire compulsorily any Target
Shares not held by it. It is also understood that following the Offer becoming
or being declared unconditional in all respects and, following the cancellation
of trading on AIM, the Target will be re-registered as a private company under
the relevant provisions of the Companies Act 2006. Such cancellations would
significantly reduce the liquidity and marketability of any Target Shares in
respect of which valid acceptances of the Offer have not been received.
12. Documentation
The Offer Document will be posted to the Target Shareholders as soon as
practicable and in any event within 28 days of this announcement.
This announcement does not constitute an offer or an invitation to purchase any
securities.
The conditions and certain further terms of the Offer are set out in Appendix I
to this announcement. Appendix II contains the definitions of certain terms
used in this announcement.
Enquiries:
European Forest Resources Acquisition Limited
William Straker-Nesbit +44 20 7596 1000
Auden Capital LLP
Piers von Simson +44 20 3008 8830
Auden Capital LLP is an appointed representative of Mirabella Financial Services
LLP, which is authorised and regulated in the United Kingdom by the Financial
Services Authority, and is acting for the Offeror and no-one else in connection
with the Offer and will not be responsible to anyone other than the Offeror for
providing the protections afforded to clients of Auden Capital LLP or for
providing advice in relation to the Offer, or the contents of this announcement
or any matter referred to herein.
The Offer will not be made, directly or indirectly, in or into, or by the use of
the mails or any means of instrumentality (including, without limitation,
telephonically or electronically) of interstate or foreign commerce of, or any
facilities of a national securities exchange of the United States, Canada,
Australia or Japan. Accordingly, except as required by applicable law, copies
of this announcement are not being, and may not be, mailed or otherwise
forwarded, distributed or sent in, into or from the United States, Canada,
Australia or Japan. Persons receiving this announcement (including without
limitation nominees, trustees or custodians) must not forward, distribute or
send it into the United States, Canada, Australia or Japan.
The availability of the Offer to Shareholders who are not resident in the United
Kingdom may be affected by the laws of the relevant jurisdictions. In
particular, as described in Appendix I, the Offer will not be made directly or
indirectly into the United States, Canada, Australia or Japan. Shareholders who
are not resident in the United Kingdom should inform themselves about and
observe any applicable requirements.
Shareholders are strongly advised to read the formal documentation in relation
to the Offer once it has been despatched.
This announcement does not constitute, or form any part of, any offer for, or
solicitation of any offer for, securities. Any acceptance or other response to
the Offer should be made on the basis of the information contained in the Offer
Document and the Form of Acceptance.
Rule 8 Notice
Under the provisions of Rule 8.3 of the Code, if any person is, or becomes,
"interested" (directly or indirectly) in 1% or more of any class of "relevant
securities" of the Target all "dealings" in any "relevant securities" of the
Target (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 pm (London time) 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 the
Target 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 Code, all "dealings" in "relevant
securities" of the Target by the Offeror or the Target, or by any of their
respective "associates", must be disclosed by no later than 12.00 noon (London
time) 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 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.
APPENDIX I
CONDITIONS AND CERTAIN FURTHER TERMS OF THE OFFER
The Offer, which will be made by the Offeror will comply with the Code and will
be governed by English law and be subject to the jurisdiction of the courts of
England. The Offer will be made on the terms and conditions to be set out in
the Offer Document.
1. CONDITIONS OF THE OFFER
The Offer will be subject to the following conditions:
(a) valid acceptances being received (and not, where permitted, withdrawn) by
3.00 p.m. on the first closing date of the Offer (or such later time(s) and/or
date(s) as the Offeror may, subject to the rules of the Code, decide) in respect
of not less than 50 per cent. in nominal value of the Shares to which the Offer
relates, provided that this condition will not be satisfied unless the Offeror
and/or any of its wholly-owned subsidiaries shall have acquired or agreed to
acquire, whether pursuant to the Offer or otherwise, Shares carrying, in
aggregate, more than 50 per cent. of the voting rights then exercisable at a
general meeting of the Target, including for this purpose to the extent (if any)
required by the Panel, any such voting rights attaching to any Shares that may
be unconditionally allotted or issued before the Offer becomes or is declared
unconditional as to acceptances whether pursuant to the exercise of any
outstanding conversion or subscription rights or otherwise, and for this
purpose:
(i) the expression "Shares to which the Offer relates" shall be construed in
accordance with sections 974-991 of the Companies Act 2006;
(ii) the expression "shares that may be unconditionally allotted or issued"
shall include any Treasury Shares which are unconditionally transferred or sold
by the Target; and
(iii) shares which have been unconditionally allotted but not issued shall be
deemed to carry the voting rights which they will carry on being entered into
the register of members of the Target;
(b) the resolution required to be put to the Target Shareholders, pursuant to
the AIM Rules or otherwise, to approve the terms of the FIM Offer is defeated;
(c) none of the individual forests which together comprise the Target's
Forests being sold or otherwise materially encumbered or their value materially
impaired;
(d) no government or governmental, quasi-governmental, supranational,
statutory, administrative or regulatory body, authority, court, trade agency,
association, institution, environmental body or any other person or body in any
jurisdiction (each a "Relevant Authority") having decided to take, instituted,
implemented or threatened any action, proceedings, suit, investigation, enquiry
or reference, or made, proposed or enacted any statute, regulation, order or
decision or taken any other steps and there not continuing to be outstanding any
statute, regulation, order or decision, which would or might:
(i) make the Offer or the acquisition of any Shares, or control of the Target
by the Offeror void, illegal or unenforceable or otherwise materially restrict,
restrain, prohibit, delay or interfere with the implementation thereof, or
impose material additional conditions or obligations with respect thereto, or
require material amendment thereof or otherwise challenge or interfere
therewith;
(ii) require or prevent the divestiture by the Target or any of its
subsidiaries or subsidiary undertakings or any associated undertaking or any
company of which 20 per cent. or more of the voting capital is held by the
Target or any partnership, joint venture, firm or company in which the Target
may be interested (the "wider Target Group") or by the Offeror or any of its
subsidiaries or subsidiary undertakings or any associated undertaking or any
company of which 20 per cent. or more of the voting capital is held by the
Offeror Group or any partnership, joint venture, firm or company in which any
member of the Offeror Group may be interested (the "wider Offeror 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 own any of their assets or property;
(iii) impose any limitation on or result in a delay in the ability of any
member of the wider Target Group or the wider Offeror Group to acquire or to
hold or to exercise effectively any rights of ownership of shares or loans or
securities convertible into shares in any member of the wider Target Group or of
the wider Offeror Group held or owned by it or to exercise management control
over any member of the wider Target Group or of the wider Offeror Group to an
extent which is material in the context of the wider Target Group taken as a
whole or, as the case may be, the wider Offeror Group taken as a whole;
(iv) require any member of the wider Offeror Group or the wider Target Group
to acquire or offer to acquire any shares or other securities in any member of
the wider Target Group where such acquisition would be material in the context
of the wider Offeror Group taken as a whole; or
(v) otherwise materially and adversely affect the assets, business, profits
or prospects of any member of the wider Offeror Group or of any member of the
wider Target Group;
and all applicable waiting and other time periods during which any such Relevant
Authority could decide to take, institute, implement or threaten any such
action, proceeding, suit, investigation, enquiry or reference having expired,
lapsed or been terminated;
(e) all necessary notifications and filings having been made, all applicable
waiting periods (including any extensions thereof) under any applicable
legislation or regulations of any jurisdiction having expired, lapsed or been
terminated, in each case in respect of the Offer and the acquisition of any
Shares, or of control of the Target, by the Offeror, and all authorisations,
orders, recognitions, grants, consents, licences, confirmations, clearances,
permissions and approvals ("Authorisations") necessary or appropriate in any
jurisdiction for, or in respect of, the Offer and the proposed acquisition of
any Shares, or of control of the Target, by the Offeror and to carry on the
business of any member of the wider Offeror Group or of the wider Target Group
having been obtained, in terms and in a form satisfactory to the Offeror, from
all appropriate Relevant Authorities and from any persons or bodies with whom
any member of the wider Offeror Group or the wider Target Group has entered into
contractual arrangements and all such Authorisations remaining in full force and
effect at the time at which the Offer becomes unconditional in all respects and
the Offeror having no knowledge of an intention or proposal to revoke, suspend
or modify or not to renew any of the same and all necessary statutory or
regulatory obligations in any jurisdiction having been complied with;
(f) except as publicly announced by the Target prior to the date hereof (by
the delivery of an announcement to a Regulatory Information Service), there
being no provision of any arrangement, agreement, licence, permit or other
instrument to which any member of the wider Target Group is a party or by or to
which any such member or any of their assets is or may be bound, entitled or be
subject to and which, in consequence of the Offer or the acquisition or proposed
acquisition of any Shares, or control of the Target, by the Offeror or
otherwise, would or might, to an extent which is material in the context of the
wider Target Group taken as a whole, result in:
(i) any monies borrowed by, or other indebtedness actual or contingent of,
any such member of the wider Target Group being or becoming repayable or being
capable of being declared immediately or prior to its or their stated maturity
or the ability of any such member to borrow monies or incur any indebtedness
being inhibited or becoming capable of being withdrawn;
(ii) 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 or any such security (whenever arising or having arisen) being
enforced or becoming enforceable;
(iii) any such arrangement, agreement, licence or instrument being terminated
or adversely modified or any action being taken of an adverse nature or any
obligation or liability arising thereunder;
(iv) any assets of any such member being disposed of or charged, or right
arising under which any such asset could be required to be disposed of or
charged, other than in the ordinary course of business;
(v) the interest or business of any such member of the wider Target Group in
or with any firm or body or person, or any agreements or arrangements relating
to such interest or business, being terminated or adversely modified or
affected;
(vi) any such member ceasing to be able to carry on business under any name
under which it presently does so;
(vii) the creation of liabilities (actual or contingent) by any such member;
or
(viii) the financial or trading position of any such member being prejudiced or
adversely affected,
and no event having occurred which, under any provision of any arrangement,
agreement, licence or other instrument to which any member of the wider Target
Group is a party, 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 paragraphs (i) to (viii) of this condition (f);
(g) except as publicly announced by the Target prior to the date hereof (by
the delivery of an announcement to a Regulatory Information Service), no member
of the wider Target Group having, since 31 December 2006:
(i) issued, agreed to issue or proposed the issue of additional shares or
securities of any class, or securities convertible into, or exchangeable for or
rights, warrants or options to subscribe for or acquire, any such shares,
securities or convertible securities (save as between the Target and wholly-
owned subsidiaries of the Target and save for options granted, and for any
Shares allotted upon exercise of options over Shares granted before the date
hereof), or redeemed, purchased or reduced any part of its share capital;
(ii) sold or transferred or agreed to sell or transfer any Treasury Shares;
(iii) recommended, declared, paid or made or proposed to recommend, declare,
pay or make any bonus, dividend or other distribution other than to the Target
or a wholly-owned subsidiary of the Target;
(iv) agreed, authorised, proposed or announced its intention to propose any
merger or demerger or acquisition or disposal of assets or shares which are
material in the context of the wider Target Group taken as a whole (other than
in the ordinary course of trading) or to any material change in its share or
loan capital;
(v) issued, authorised or proposed the issue of any debentures or incurred
any indebtedness or contingent liability;
(vi) acquired any material asset;
(vii) entered into or varied or announced its intention to enter into or vary
any contract, arrangement or commitment (whether in respect of capital
expenditure or otherwise) which is of a long-term or unusual nature or involves
or could involve an obligation of a nature or magnitude;
(viii) entered into or proposed or announced its intention to enter into any
reconstruction, amalgamation, transaction or arrangement (otherwise than in the
ordinary course of business);
(ix) taken any action nor having had any steps taken or legal proceedings
started or threatened against it for its winding-up or dissolution or for it to
enter into any arrangement or composition for the benefit of its creditors, or
for the appointment of a receiver, administrator, trustee or similar officer if
it or any of its assets (or any analogous proceedings or appointment in any
overseas jurisdiction);
(x) been unable, or admitted in writing that it is unable, to pay its debts
or having stopped or suspended (or threatened to stop or suspend) payment of its
debts generally or ceased or threatened to cease carrying on all or a
substantial part of its business;
(xi) entered into or varied or made any offer to enter into or vary the terms
of any service agreement or arrangement with any of the Directors of the Target;
(xii) waived, compromised or settled any claim which is material in the context
of the wider Target Group; or
(xiii) entered into or made an offer (which remains open for acceptance) to
enter into any agreement, arrangement or commitment or passed any resolution
with respect to any of the transactions or events referred to in this paragraph
(g);
(h) since 31 December 2006, except as publicly announced by the Target prior
to the date hereof (by the delivery of an announcement to a Regulatory
Information Service);
(i) there having been no adverse change in the business, assets, financial or
trading position or profits or prospects of any member of the wider Target
Group;
(ii) prior to the date hereof no litigation, arbitration proceedings,
prosecution or other legal proceedings having been instituted, announced or
threatened by or against or remaining outstanding against any member of the
wider Target Group and no enquiry or investigation by or complaint or reference
to any Relevant Authority against or in respect of any member of the wider
Target Group having been threatened, announced or instituted or remaining
outstanding; and
(iii) no contingent or other liability having arisen or been incurred which
might reasonably be expected to materially and adversely affect any member of
the wider Target Group;
(i) the Offeror not having discovered that, save as publicly announced by the
Target prior to the date hereof (by the delivery of an announcement to a
Regulatory Information Service):
(i) the financial, business or other information concerning the wider Target
Group which has been disclosed at any time by or on behalf of any member of the
wider Target Group whether publicly (by the delivery of an announcement to a
Regulatory Information Service) or to the Offeror or its professional advisers,
either contains a material misrepresentation of fact or omits to state a fact
necessary to make the information contained therein not materially misleading;
or
(ii) any member of the wider Target Group is subject to any liability,
contingent or otherwise, which is not disclosed in the annual report and
accounts of the Target for the financial year ended 31 December 2006 and which
is material in the context of the wider Target Group taken as a whole;
(iii) any past or present member of the wider Target Group has not complied
with all applicable legislation or regulations of any jurisdiction or any notice
or requirement of any Relevant Authority with regard to the storage, disposal,
discharge, spillage, leak or emission of any waste or hazardous substance or any
substance likely to impair the environment or harm human health which non-
compliance would be likely to give rise to any liability (whether actual or
contingent) which is material in the context of the wider Target Group taken as
a whole on the part of any member of the wider Target Group;
(iv) there has been a disposal, spillage, emission, discharge or leak of waste
or hazardous substance or any substance likely to impair the environment or harm
human health on, or from, any land or other asset now or previously owned,
occupied or made use of by any past or present member of the wider Target Group,
or which any such member may now or previously have had an interest, would be
likely to give rise to any liability (whether actual or contingent) which is
material in the context of the wider Target Group taken as a whole on the part
of any member of the wider Target Group;
(v) there is or is likely to be any obligation or liability (whether actual
or contingent) which is material in the context of the wider Target Group taken
as a whole to make good, repair, reinstate or clean up any property now or
previously owned, occupied or made use of by any past or present member of the
wider Target Group or in which any such member may now or previously have had an
interest under any environmental legislation or regulation or notice, circular
or order of any Relevant Authority in any jurisdiction; or
(vi) circumstances exist whereby a person or class of persons would be likely
to have any claim or claims in respect of any product or process of manufacture,
or materials used therein, now or previously manufactured, sold or carried out
by any past or present member of the wider Target Group which claim or claims
would be likely to affect adversely any member of the wider Target Group in a
manner which is material in the context of the wider Target Group taken as a
whole.
The Offeror reserves the right to waive, in whole or in part, all or any of
conditions (b) to (i) inclusive. The Offeror also reserves the right, subject
to the consent of the Panel, to extend the time allowed under the Code for
satisfaction of condition (a) until such time as conditions (b) to (i) have been
satisfied, fulfilled or, to the extent permitted, waived. If the Offeror is
required by the Panel to make an offer for Shares under the provisions of Rule 9
of the Code, the Offeror may make such alterations to the above conditions,
including condition (a) above, as are necessary to comply with the provisions of
that Rule.
2. FURTHER TERMS OF THE OFFER
(a) The Offer will extend to all Shares unconditionally allotted or issued on
the date on which the Offer is made, and any further Shares unconditionally
allotted or issued, and any Treasury Shares unconditionally sold or transferred
by the Target, in each case, while the Offer remains open for acceptance (or
such earlier date or dates as the Offeror may decide).
(b) The Shares are to be acquired by the Offeror fully paid and free from all
liens, charges and encumbrances, rights of pre-emption and any other third party
rights of any nature whatsoever and together with all rights attaching thereto,
including the right to all dividends or other distributions declared, paid or
made after the date hereof.
APPENDIX II
DEFINITIONS
The following definitions apply throughout this announcement unless the context
requires otherwise:
"AIM" the market of that name operated by the London Stock Exchange
"AIM Rules" the rules applicable to AIM as published by the London Stock
Exchange from time to time
"Australia" the Commonwealth of Australia, its states, territories and
possessions
"Board" as the context requires, the board of directors of the Target or
the board of directors of the Offeror
"Business Day" a day on which the commercial banks are open for business in
London
"Canada" Canada, its provinces and territories and all areas subject to
its jurisdiction and any political sub-division thereof
"Code" the City Code on Takeovers and Mergers
"Closing Price" the middle market price of the relevant shares at the close of
business on the day which such price relates, as derived from
the daily official list of the London Stock Exchange
"Companies Act 1985" the Companies Act 1985
"Companies Act 2006" the Companies Act 2006
"Directors" as the context requires, the members of the Board of the Target
or the members of the Board of the Offeror
"FIM Offer" the conditional agreement between the Target and FIM Timber
Growth Fund IV to acquire the Forests as announced by the Target
on 24 August 2007 and any subsequent amendment or variation
thereof
"Forests" the Target's UK forestry assets, named Myredykes, Corlae, Coed
Ty Glas, Rhyd Y Felin and Nant Y Cerdin
"Form of Acceptance" the form of acceptance and authority for use by the Target
Shareholders in connection with the Offer
"Japan" Japan, its cities and prefectures, territories and possessions
"Listing Rules" the listing rules issued by the UK Listing Authority pursuant to
Part VI of the Financial Services and Markets Act 2000
"London Stock Exchange" London Stock Exchange plc
"Offer" the recommended cash offer to be made by the Offeror to acquire
all of the Shares not already held by the Offeror on the terms
and subject to the conditions to be set out in a formal offer
document and the form of acceptance relating thereto, and
including, where the context so requires, any subsequent
revision, variation, extension or renewal of such offer
"Offer Document" the document to be posted to Shareholders on behalf of the
Offeror containing the terms and conditions of the Offer
"Offer Period" the period commencing on (and including) 20 June 2007 until
whichever of the following times and dates shall be the latest:
(i) 3.00 p.m. on the first closing date of the Offer;
and
(ii) the earlier of:
(a) the time and date at which the Offer lapses; and
(b) the time and date at which the Offer becomes
unconditional as to acceptances
"Offer Price" 120 pence per Share
"Offeror" European Forest Resources Acquisition Limited of Queensberry
House, 3 Old Burlington Street, London W1S 3LD
"Offeror Group" the Offeror, European Forest Resources (U.K.) S.a r.l., European
Forest Resources Limited, Louis Dreyfus SAS and their respective
subsidiaries and subsidiary undertakings
"Panel" the Panel on Takeovers and Mergers
"Regulatory Information Service" a Regulatory Information Service that is approved by the
Financial Services Authority and is on the list maintained by
the Financial Services Authority in LR App 3 to the Listing
Rules
"subsidiary" and "subsidiary undertaking" have the meanings given to them in the Companies Act 1985
"Target Shares" or Shares" the existing unconditionally allotted or issued and fully paid
ordinary shares of 50 pence each in the capital of the Target
and any further such shares which are unconditionally allotted
or issued and fully paid, and any Treasury Shares
unconditionally sold or transferred by the Target, in each case,
before the date on which the Offer closes (or such earlier date
(s) as the Offeror may, subject to the Code, determine),
including any such shares so unconditionally allotted or issued
pursuant to the exercise of options granted over Shares
"Target Shareholders" or "Shareholders" holders of Shares
"Treasury Shares" shares held as treasury shares as defined in section 162A(3) of
the Companies Act 1985
"UK" or "United Kingdom" the United Kingdom of Great Britain and Northern Ireland
"UK Listing Authority" the Financial Services Authority as the competent authority
under Part VI of the Financial Services and Markets Act 2000
"United States" the United States of America, its territories and possessions,
any state of the United States of America, the District of
Columbia, and all other areas subject to its jurisdiction
"#" or "Sterling" pounds sterling, the lawful currency for the time being of the
UK and references to "pence" and "p" shall be construed
accordingly
END
This information is provided by RNS
The company news service from the London Stock Exchange
END
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