Andor Technology plc Response to possible offer from Oxford Instruments (7867S)

TIDMAND TIDMOXIG

RNS Number : 7867S

Andor Technology plc

12 November 2013

NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION IN WHOLE OR IN PART IN OR INTO ANY JURISDICTION WHERE TO DO SO WOULD CONSTITUTE A VIOLATION OF ANY RELEVANT LAWS OR REGULATIONS OF THAT JURISDICTION

Andor Technology plc - Response To Possible Offer from Oxford Instruments plc

The Board of Andor Technology plc ("Andor") notes today's announcement by Oxford Instruments plc ("Oxford Instruments") pursuant to Rule 2.4 of the City Code on Takeovers and Mergers (the "Code"), that it is considering a possible offer for all the issued and to be issued share capital of Andor.

Andor first received an indicative cash offer from Oxford Instruments on 9 July 2013. Since then, Andor has co-operated with Oxford Instruments in the provision of commercial and financial due diligence as well as engaging in multiple face-to-face meetings. To date, these discussions have resulted in a 19% increase in the indicative cash offer price per share to 500p (subject to due diligence), during which time Andor's share price has increased by over 30%(1) . Shareholders should be aware that the most recent indicative proposal, received on 8 November 2013 and as considered by the Board of Andor, attached below, contains the following:

   --      An indicative offer price of up to 500p per Andor share

-- Oxford Instruments reserves the right to make an offer on less favourable terms to Andor shareholders, subject to certain conditions

-- Oxford Instruments reserves the right to introduce forms of consideration other than cash and/or vary the proposed mix of consideration in any offer; and

-- The indicative offer is subject to the pre-condition, amongst others, that Oxford Instruments finalises its due diligence.

The Board of Andor is disappointed that, having only made the indicative proposal on 8 November, Oxford Instruments has chosen to make today's announcement, which the Board of Andor considers to be premature and unhelpful in light of ongoing discussions. Given the level of uncertainty and conditionality, the Board of Andor felt that it could not properly consider the proposal, but it did confirm to Oxford Instruments that it remained willing to continue discussions to explore whether a definitive, acceptable offer might be found that was in the interests of Andor shareholders.

Shareholders should note that there can be no certainty that an offer will be made nor as to the terms contained therein.

The Board of Andor remains committed to our long term strategy of delivering growth through continued investment in innovation. We are focussed on expanding our addressable markets and utilising our strong cash generation to target strategic acquisitions that further accelerate growth. As per our trading update on 2 October 2013 for the financial year ended 30 September 2013, we now expect full year order intake to be at record levels and, since the year-end, we have completed two acquisitions that are strategically aligned with our business plan. While we remain committed to our internal plans, the Board of Andor confirms, in respect of this potential offer, that it is willing to consider any proposal which maximises value for its shareholders, while minimising conditionality and execution risk.

In accordance with Rule 2.6(a) of the Code, Oxford Instruments must, by not later than 5.00 p.m. on 10 December 2013, either announce a firm intention to make an offer for Andor in accordance with Rule 2.7 of the Code or announce that it does not intend to make an offer, in which case the announcement will be treated as a statement to which Rule 2.8 of the Code applies. This deadline will only be extended with the consent of the Takeover Panel ("the Panel") in accordance with Rule 2.6(c) of the Code.

Andor shareholders will be kept informed of relevant developments and a further announcement will be made as appropriate.

In accordance with Rule 2.10 of the Code, Andor confirms that, at the close of business on 11 November 2013, it had 32,020,496 ordinary shares of 2 pence each in issue and admitted to trading on the AIM market of the London Stock Exchange.

This announcement has been made without the consent of Oxford Instruments.

The International Securities Identification Number for the Andor ordinary shares is GB00B043J741.

 
 Enquiries: 
                                                             +44 (0) 28 9023 
 Andor Technology           Conor Walsh, Chief Executive      7126 
                            Alan Lilley, Finance Director 
 
                            Matt Dixon / Tracey Bowditch     +44 (0) 20 7831 
 FTI Consulting              / Jessica Liebmann               3113 
 
 Jefferies International 
  (Financial Adviser        Dominic Lester / Tariq           +44 (0)20 7029 
  to Andor)                  Hussain                          8000 
 Investec 
  (Nominated Adviser 
  & Corporate Broker        Keith Anderson / Dominic         +44 (0) 20 7597 
  to Andor)                  Emery                            4000

Jefferies International Limited, which is authorised and regulated in the United Kingdom by the Financial Conduct Authority, is acting exclusively for Andor and no one else in connection with matters described in this announcement and will not be responsible to anyone other than Andor for providing the protections afforded to clients of Jefferies International Limited nor for providing advice in relation to matters described in this announcement.

Investec Investment Banking, a division of Investec Bank plc, which is authorised by the Prudential Regulation Authority and regulated in the United Kingdom by the Prudential Regulation Authority and the Financial Conduct Authority, is acting exclusively for Andor and no one else in connection with matters described in this announcement and will not be responsible to anyone other than Andor for providing the protections afforded to clients of Investec Investment Banking nor for providing advice in relation to matters described in this announcement.

Dealing and Disclosure requirements of the City Code of Takeovers and Mergers (the "Code")

Under Rule 8.3(a) of the Code, any person who is interested in 1% or more of any class of relevant securities of an offeree company or of any securities exchange offeror (being any offeror other than an offeror in respect of which it has been announced that its offer is, or is likely to be, solely in cash) must make an Opening Position Disclosure following the commencement of the offer period and, if later, following the announcement in which any securities exchange offeror is first identified. An Opening Position Disclosure must contain details of the person's interests and short positions in, and rights to subscribe for, any relevant securities of each of (i) the offeree company and (ii) any securities exchange offeror(s). An Opening Position Disclosure by a person to whom Rule 8.3(a) applies must be made by no later than 3.30 pm (London time) on the 10th business day following the commencement of the offer period and, if appropriate, by no later than 3.30 pm (London time) on the 10th business day following the announcement in which any securities exchange offeror is first identified. Relevant persons who deal in the relevant securities of the offeree company or of a securities exchange offeror prior to the deadline for making an Opening Position Disclosure must instead make a Dealing Disclosure.

Under Rule 8.3(b) of the Code, any person who is, or becomes, interested in 1% or more of any class of relevant securities of the offeree company or of any securities exchange offeror must make a Dealing Disclosure if the person deals in any relevant securities of the offeree company or of any securities exchange offeror. A Dealing Disclosure must contain details of the dealing concerned and of the person's interests and short positions in, and rights to subscribe for, any relevant securities of each of (i) the offeree company and (ii) any securities exchange offeror, save to the extent that these details have previously been disclosed under Rule 8. A Dealing Disclosure by a person to whom Rule 8.3(b) applies must be made by no later than 3.30 pm (London time) on the business day following the date of the relevant dealing.

If two or more persons act together pursuant to an agreement or understanding, whether formal or informal, to acquire or control an interest in relevant securities of an offeree company or a securities exchange offeror, they will be deemed to be a single person for the purpose of Rule 8.3.

Opening Position Disclosures must also be made by the offeree company and by any offeror and Dealing Disclosures must also be made by the offeree company, by any offeror and by any persons acting in concert with any of them (see Rules 8.1, 8.2 and 8.4).

Details of the offeree and offeror companies in respect of whose relevant securities Opening Position Disclosures and Dealing Disclosures must be made can be found in the Disclosure Table on the Takeover Panel's website at www.thetakeoverpanel.org.uk, including details of the number of relevant securities in issue, when the offer period commenced and when any offeror was first identified. You should contact the Panel's Market Surveillance Unit on +44 (0)20 7638 0129 if you are in any doubt as to whether you are required to make an Opening Position Disclosure or a Dealing Disclosure.

Notes

(1) Based on Andor's mid-market closing price on 11 November 2013 of 400.0 pence per share and Andor's mid-market closing price on 9 July 2013 of 302.25 pence per share, as provided by the London Stock Exchange.

Oxford Instruments plc

Tubney Woods, Abingdon,

Oxon OX13 5QX UK

Tel: +44 (0) 1865 393200

Fax: +44 (0) 1865 393351

Email: info.oiplc@oxinst.com

www.oxford-instruments.com

8 November 2013

The Board of Directors

Andor Technology plc ("Andor")

7 Millennium Way

Springvale Business Park

Belfast, BT12 7AL

(by e-mail)

Dear Sirs,

We are writing in relation to the recent discussions that have taken place between Oxford Instruments plc ("Oxford Instruments") and Andor in relation to a possible offer by Oxford Instruments of 500 pence in cash per Andor share, described in more detail below.

Our indicative proposal

We are pleased to set out below the terms of our indicative proposal:

-- Offer price of up to 500 pence per share in cash. The key assumptions underpinning this offer price are:

   1)   no dividend is declared or paid by Andor after the date of this letter; and

2) the fully diluted share capital of Andor is no more than 33.2 million shares and that no further options will be granted after the date of this letter.

   --      Our offer is subject to the completion of satisfactory confirmatory due diligence.

-- A firm offer would need to be approved by Oxford Instruments' board of directors. Based on our understanding of Andor's results for the year ended 30 September 2013, the transaction would be a class 2 transaction for Oxford Instruments and would not require Oxford Instruments' shareholder approval.

-- Oxford Instruments does not foresee any relevant competitive overlaps between Oxford Instruments and Andor. Accordingly, any merger filings that may be necessary should only be technical and should not cause any delays or uncertainty.

-- Any offer, if made, will be financed from existing cash resources and the proceeds of debt facilities that have been arranged by Oxford Instruments. These facilities have already been substantially agreed with the respective providers and are capable of completion in a number of days. The terms of the debt facilities have been negotiated to ensure that our financial adviser will be able at the appropriate time to give the necessary confirmation to Andor shareholders as to the certainty of funds under the offer.

-- Finally, our indicative offer is predicated on the basis that it will have the unanimous and unqualified recommendation of the Andor board of directors.

Next steps

We envisage working together with Andor to finalise our due diligence and make a recommended 2.7 announcement on 2 December.

In the near term, we envisage making a joint 2.4 announcement, in a form to be agreed between us, that Oxford Instruments and Andor are working together towards a recommended transaction based on an indicative all-cash offer price of 500 pence per share at the time of the publication of Oxford Instruments interim results on Tuesday, 12 November 2013. A draft of the announcement for your review is attached.

Status of this letter

For the avoidance of doubt, this letter does not amount to a commitment by Oxford Instruments to proceed with this indicative proposal nor a commitment by Andor to recommend the indicative proposal. Neither does our summary of our indicative offer set out above constitute an offer or evidence a firm intention to make an offer within the meaning of the City Code on Takeovers and Mergers.

This letter is not intended to create legally binding obligations on either Andor or Oxford Instruments, in particular, as to any course of action that either Andor or Oxford Instruments believes to be necessary or appropriate having regard to the legal or regulatory obligations of Andor or Oxford Instruments or their respective directors.

We would be grateful if you could respond to this letter by no later than noon on 11 November 2013.

Yours faithfully,

Chairman

Oxford Instruments plc

Draft form of Announcement

Embargoed until 7:00 am on 12 November 2013

NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION (IN WHOLE OR IN PART) IN, INTO OR FROM ANY JURISDICTION WHERE TO DO SO WOULD CONSTITUTE A VIOLATION OF THE RELEVANT LAWS OF SUCH JURISDICTION

This is an announcement falling under Rule 2.4 of the City Code on Takeovers and Mergers (the "Code") and does not constitute an announcement of a firm intention to make an offer or to pursue any other transaction under Rule 2.7 of the Code. Accordingly, Andor Technology plc shareholders are advised that there can be no certainty that a formal offer for Andor Technology plc will be forthcoming, even in the event that the pre-conditions in this announcement are satisfied or waived.

For immediate release 12 November 2013

Oxford Instruments plc - Possible Offer for Andor Technology plc

The boards of Oxford Instruments plc ("Oxford Instruments" or the "Company") and Andor Technology plc ("Andor") today announce that they are currently working toward a recommended cash offer of 500 pence per share for the entire issued and to be issued share capital of Andor (the "Indicative Offer").

Oxford Instruments considers that the acquisition of Andor has significant industrial and commercial logic and that Andor would benefit from being part of the Oxford Instruments group. Andor's product portfolio is highly complementary to Oxford Instruments' Nanotechnology Tools division. Both Andor and Oxford Instruments have strong capabilities in selling to academic customers and, together, the companies could offer a unique range of instrumentation to scientific users as well as leverage a more powerful distribution network. The enlarged group would benefit from the considerable strength that exists in both R&D teams and strong technical management. In addition, Oxford Instruments fully recognises the value of Andor's Belfast base with its highly skilled workforce and believes the cultural fit between Andor and Oxford Instruments is strong.

The Indicative Offer represents:

-- a premium of 69% to the Andor closing share price of 296.0 pence as of 8 July 2013(1), being the day prior to Oxford Instruments' initial approach to Andor;

-- a premium of [--]% to the Andor closing share price of [--] pence as of 11 November 2013(2) , being the last trading day prior to the date of this announcement;

-- a premium of [--]% to the volume weighted average traded share price of Andor of [--] pence over the period of 90 days ended on 11 November 2013(3) ; and

-- a premium of [--]% to the average closing share price of Andor of [--] pence over the period of 90 days ended on 11 November 2013(4) .

Oxford Instruments and Andor have been in discussions since 9 July 2013, when Oxford Instruments sent a letter to the Chairman of Andor setting out the strategic rationale for the transaction and an indicative proposal of 420 pence per share in cash, subject to due diligence. That proposal, which was based solely on a review of publicly available information, represented a premium of 42% to the Andor closing share price as of 8 July 2013(1) . On 7 September 2013, Oxford Instruments informed Andor that it was prepared to increase its indicative proposal to 470 pence per Andor share, subject to due diligence. This revised price represented a premium of 59% to the closing Andor share price the day before Oxford Instruments' initial proposal on 9 July 2013(1) and a 29% premium to the Andor closing price on 6 September 2013(5). Andor subsequently granted access to commercial and financial due diligence to Oxford Instruments in early October. Following access to due diligence and Andor's recently announced acquisitions; Oxford Instruments has increased its indicative proposal to 500 pence per Andor share.

The making of any offer is subject to the following pre-conditions:

   i.    Oxford Instruments finalising due diligence;

ii. the unanimous and unqualified recommendation by the board of Andor in respect of any offer by Oxford Instruments; and

iii. each member of the board of Andor giving irrevocable undertakings to accept any offer in respect of all of their Andor shares.

Oxford Instruments reserves the right to waive any or all of the pre-conditions described in this announcement. Even if all of these pre-conditions are satisfied or waived, there can be no certainty that a firm offer will be forthcoming.

Further, Oxford Instruments reserves the right to make an offer on less favourable terms than those set out in this announcement in the event that:

i. an agreement and recommendation in respect of such terms is reached with the board of Andor; or

   ii.    there is an announcement of: 
   b)   a firm intention to make an offer by a third party for Andor at a lower price; or 
   c)   a possible offer by a third party for Andor at a lower price; or 
   d)   an approach by a third party for Andor at a lower price; or

iii. Andor announces, declares, pays or makes any dividend or distribution to Andor shareholders at any time, in which case there will be an equivalent reduction in Oxford Instruments' offer price; or

iv. the issued and to be issued share capital of Andor is greater than the 33.2 million shares that has been assumed, such that the pro rata entitlement per Andor share is lower than 500 pence.

In addition, Oxford Instruments reserves the right to introduce other forms of consideration and/or vary the proposed mix of consideration in any offer.

Rule 2.6(a) of the Code, requires that Oxford Instruments, by not later than 5.00 p.m. on 10 December 2013 (the "relevant deadline"), either announces a firm intention to make an offer for Andor in accordance with Rule 2.7 of the Code or announces that it does not intend to make an offer, in which case the announcement will be treated as a statement to which Rule 2.8 of the Code applies. This deadline can be extended with the consent of the Takeover Panel in accordance with Rule 2.6(c) of the Code.

Notes

(1) Based on Andor's mid-market closing price on 8 July 2013 of 296.0 pence per share, as provided by the London Stock Exchange.

(2) Based on Andor's mid-market closing price on 11 November 2013 of [--] pence per share, as provided by the London Stock Exchange.

(3) Based on [--] pence per Andor share, being the volume weighted average share price of Andor calculated using the price and volume of each Andor share trade between 14 August 2013 and 11 November 2013 as provided by the London Stock Exchange.

(4) Based on [--] pence per Andor share, being an arithmetic average of Andor's daily mid-market closing price between 14 August 2013 and 11 November 2013 as provided by the London Stock Exchange.

(5) Based on Andor's mid-market closing price on 6 September 2013 of 365.0 pence per share, as provided by the London Stock Exchange.

Enquiries

 
 Oxford Instruments        Jonathan Flint, Chief   Tel: +44 1865 393200 
  plc                       Executive 
                            Kevin Boyd, Group 
                            Finance Director 
 Evercore                  Bernard Taylor          Tel: +44 20 7653 6000 
  (Financial Adviser        Julian Oakley 
  to Oxford Instruments)

A copy of this announcement will be available at www.oxford-instruments.com. The content of the website referred to in this announcement is not incorporated into and does not form part of this announcement.

Dealing Disclosure Requirements

An Opening Position Disclosure must contain details of the person's interests and short positions in, and rights to subscribe for, any relevant securities of each of (i) the offeree company and (ii) any securities exchange offeror(s). An Opening Position Disclosure by a person to whom Rule 8.3(a) applies must be made by no later than 3.30 pm (London time) on the 10th business day following the commencement of the offer period and, if appropriate, by no later than 3.30 pm (London time) on the 10th business day following the announcement in which any securities exchange offeror is first identified. Relevant persons who deal in the relevant securities of the offeree company or of a securities exchange offeror prior to the deadline for making an Opening Position Disclosure must instead make a Dealing Disclosure.

Details of the offeree and offeror companies in respect of whose relevant securities Opening Position Disclosures and Dealing Disclosures must be made can be found in the Disclosure Table on the Takeover Panel's website at www.thetakeoverpanel.org.uk, including details of the number of relevant securities in issue, when the offer period commenced and when any offeror was first identified. If you are in any doubt as to whether you are required to make an Opening Position Disclosure or a Dealing Disclosure, you should contact the Panel's Market Surveillance Unit on +44 (0)20 7638 0129.

Evercore, the marketing name for Evercore Partners International LLP, which is authorised in the United Kingdom by the Prudential Regulation Authority and regulated by the Financial Conduct Authority, is acting exclusively for Oxford Instruments and no one else in connection with the matters referred to in this announcement, and will not be responsible to anyone other than Oxford Instruments for providing the protections afforded to its clients or for providing advice in relation to the matters referred to in this announcement.

This information is provided by RNS

The company news service from the London Stock Exchange

END

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