TIDMAIEA
RNS Number : 6707Y
Airea PLC
03 December 2014
NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION DIRECTLY OR
INDIRECTLY, IN OR INTO, THE UNITED STATES, AUSTRALIA, NEW ZEALAND,
CANADA, JAPAN, THE REPUBLIC OF IRELAND OR THE REPUBLIC OF SOUTH
AFRICA OR INTO ANY OTHER JURISDICTION WHERE TO DO SO MIGHT
CONSTITUTE A VIOLATION OR BREACH OF ANY APPLICABLE LAW
AIREA plc ('the Company')
Proposed Tender Offer
The Company announces today a proposed tender offer to be made
by N+1 Singer to Qualifying Shareholders to purchase up to 10
million Ordinary Shares, representing 21.6 per cent. of the
Company's issued Ordinary Shares, at a fixed price of 12.25 pence
per Ordinary Share in accordance with the terms and conditions of
the Tender Offer set out in Part III of the Circular being sent to
Shareholders today.
The implementation of the Tender Offer requires the approval of
Shareholders and a Notice of General Meeting accompanies the
Circular which convenes a General Meeting to be held at the offices
of Eversheds LLP at Bridgewater Place, Water Lane, Leeds LS11 5DR
at 11.00 a.m. on 19 December 2014. The Resolution to approve the
purchase of Ordinary Shares pursuant to the Tender Offer at a fixed
price of 12.25 pence per Ordinary Share will be proposed at the
General Meeting.
The Tender Offer
The key points of the Tender Offer are as follows:
-- The Board is proposing the Tender Offer in order to provide a
guaranteed liquidity event for all Qualifying Shareholders, to
reduce administrative costs in relation to the shareholder base of
the Company, by potentially reducing the number of Shareholders,
and to increase earnings per share through the reduction of the
total number of Ordinary Shares in issue.
-- The Tender Offer will be structured in order to allow Small
Shareholders, with 1,000 Ordinary Shares or less, to dispose of
their entire holding of Ordinary Shares without being scaled back.
Such Small Shareholders must tender all or none of their Ordinary
Shares.
-- Each Qualifying Shareholder who is not a Small Shareholder
may offer to tender none, some or all of their Ordinary Shares,
subject to the Minimum Tender Size (of 1,000 Ordinary Shares).
-- In the event that total valid applications exceed 10,000,000
Ordinary Shares, after having accepted applications from Small
Shareholders in full, the remaining individual applications from
Qualifying Shareholders will be scaled back pro rata to the size of
their applications.
-- If approved, the Tender Offer will be funded from the
Company's existing cash resources. The Overdraft will be utilised
to fund the working capital requirements of the Company and its
Subsidiaries going forward.
Expected Timetable of Principal Events
Commencement of Tender Offer 4 December 2014
Latest time and date for receipt 11.00 a.m. on 17 December
of Forms of Proxy for General 2014
Meeting
General Meeting 11.00 a.m. on 19 December
2014
Latest time and date for receipt 1.00 p.m. on 7 January 2015
of Tender Forms and TTE Instructions
Record Date for Tender Offer 5.00 p.m. on 7 January 2015
Announcement of take-up under by 7.00 a.m. on 9 January
Tender Offer 2015
Purchase of Ordinary Shares under 9 January 2015
Tender Offer
CREST accounts credited with 20 January 2015
proceeds due under the Tender
Offer
Latest date for despatch of cheques 20 January 2015
for certificated Ordinary Shares
pursuant to the Tender Offer
Balance certificates despatched 20 January 2015
in respect of Ordinary Shares
Definitions in this announcement are the same as those used in
the Circular.
Copies of the Circular are available from the Company and on the
Company's website at http://www.aireaplc.com/.
The Tender Offer is not being made, directly or indirectly, in
or into, or by any means or instrumentality of interstate or
foreign commerce of, or any facilities of a national securities
exchange of, the United States, Canada, Australia, New Zealand,
Japan, the Republic of Ireland or the Republic of South Africa or
any other Restricted Jurisdiction. Copies of the Tender Form are
not being and must not be mailed or otherwise distributed or sent
in or into the United States, Canada, Australia, New Zealand,
Japan, the Republic of Ireland or the Republic of South Africa
including to Shareholders with registered addresses in these
jurisdictions or to persons whom the Company knows to be trustees,
nominees or custodians holding Ordinary Shares for such
persons.
N+1 Singer, which is authorised and regulated in the United
Kingdom by the Financial Conduct Authority, is acting as nominated
adviser and broker to the Company in connection with the matters
described in the Circular. N+1 Singer will not be responsible to
anyone other than the Company for providing the protections
afforded to customers of N+1 Singer or for advising any other
person on the arrangements described in the Circular. N+1 Singer
has not authorised the contents of, or any part of, this
announcement or the Circular and no liability whatsoever is
accepted by N+1 Singer for the accuracy of any information or
opinions contained in this announcement or the Circular or for the
omission of any information. N+1 Singer, as nominated adviser and
broker to the Company, owes certain responsibilities to the London
Stock Exchange which are not owed to the Company or the
Directors.
For further information, please contact:
AIREA plc
Neil Rylance, Chief Executive Officer 01924 266561
Roger Salt, Finance Director
N+1 Singer
Richard Lindley 020 7496 3000
James White
Background to and reasons for the Tender Offer
The Company has approximately 1,240 Shareholders, overwhelmingly
comprising private investors, of whom approximately 460
Shareholders own 1,000 Ordinary Shares or less. Certain small
holdings are of a size which are uneconomic to trade because of
associated dealing costs. There is little liquidity in the Ordinary
Shares, with market makers quoting prices in units of only 5,000
Ordinary Shares. The average number of trades per day over the last
12 months was approximately 1.5 and the average number of Ordinary
Shares traded per month over the last 12 months was 353,840,
representing approximately 0.8 per cent. of the issued share
capital of the Company.
The Board is proposing the Tender Offer in order to provide a
guaranteed liquidity event for all Qualifying Shareholders, to
reduce administrative costs in relation to the shareholder base of
the Company, by potentially reducing the number of Shareholders,
and to increase earnings per share through the reduction of the
total number of Ordinary Shares in issue.
The Tender Offer will be structured in order to allow Small
Shareholders, with 1,000 Ordinary Shares or less, to dispose of
their entire holding of Ordinary Shares without being scaled back.
Such Small Shareholders must tender all or none of their Ordinary
Shares.
If approved, the Tender Offer will be funded from the Company's
existing cash resources. The Overdraft will be utilised to fund the
working capital requirements of the Company and its Subsidiaries
going forward. The Overdraft replaces a similar overdraft facility
which the Company and certain of its Subsidiaries had with
Clydesdale Bank Plc.
The Pension Scheme Trustees and the Company have separately
obtained advice that the Tender Offer may be detrimental to the
Pension Scheme. It is not thought by such advisors, however, that
such detriment will be material and, as such, clearance from the
Pensions Regulator is not required. The Company has though agreed
to grant a legal mortgage (in order to secure liabilities to the
Pension Scheme Trustees of up to GBP1.25 million) over the Victoria
Mills property owned by the Company's subsidiary, Burmatex Limited,
in favour of the Pension Scheme Trustees in order to mitigate such
potential detriment.
Current Trading
In the announcement of the results for the year to 30 June 2014,
the Company reported an improvement in trading in the second half
of the financial year following a difficult first six months,
resulting in increased underlying profitability for the year as a
whole.
The trading environment has been in line with the expectations
expressed in the results statement. The Eurozone continues to
struggle to break out of a pattern of stagnation, and the UK public
sector remains squeezed by austerity. However, UK private
construction new build and refurbishment performance has been more
robust. Against this market backdrop the success achieved in the
second half of the last financial year has been maintained and the
dip in sales seen in the first half of last year reversed.
The Board does not detect any fundamental changes in the outlook
for the markets that we serve, and competition for business is
likely to remain fierce. However, there is no reason to believe
that the performance achieved through the second half of the last
financial year and in the current financial period cannot be
sustained.
Tender Offer
Summary of Tender Offer
As explained above, N+1 Singer has agreed to provide Qualifying
Shareholders with the opportunity to sell their Ordinary Shares,
pursuant to the Tender Offer, which N+1 Singer will purchase, as
principal. The Company has agreed that, upon receipt of written
notice from N+1 Singer, it shall repurchase the Ordinary Shares
acquired by N+1 Singer pursuant to the Tender Offer and any
Ordinary Shares so purchased shall be cancelled. The Tender Offer
is subject to the conditions set out in the Repurchase Agreement
being fulfilled.
A letter from N+1 Singer containing further details relating to
the Tender Offer and the terms and conditions of the Tender Offer
are set out in Parts II and III of the Circular, respectively.
Under the terms of the Tender Offer, the price to be paid for each
Ordinary Share subject to the Tender Offer is 12.25 pence. This
represents a premium of 4.3 per cent. over the closing
middle-market price of an Ordinary Share on 2 December 2014, being
the latest practicable date prior to the date of the Circular, and
a premium of 4.4 per cent. over the average closing middle-market
price of an Ordinary Share over the three months to 30 November
2014.
N+1 Singer has agreed to accept in full all valid tenders made
by Small Shareholders. Each Small Shareholder must tender either
all or none of their Ordinary Shares in order for such tenders to
be valid and all such valid tenders will be accepted in full.
Each Qualifying Shareholder who is not a Small Shareholder may
offer to tender none, some or all of their Ordinary Shares, subject
to the Minimum Tender Size (being 1,000 Ordinary Shares). In the
event that total valid applications exceed 10,000,000 Ordinary
Shares, after having accepted valid applications from Small
Shareholders in full, the remaining individual applications from
Qualifying Shareholders will be scaled back pro rata to the size of
their applications.
Shareholders should note that there is no obligation for
Qualifying Shareholders to sell any of their Ordinary shares.
Summary of Repurchase Agreement
On 2 December 2014, the Company entered into the Repurchase
Agreement with N+1 Singer. Under the terms of the Repurchase
Agreement the parties have agreed that, subject to certain
conditions, including:
(a) the Tender Offer becoming unconditional in all respects and
not lapsing or terminating in accordance with its terms; and
(b) an amount equal to the Tender Price multiplied by the
maximum number of Ordinary Shares capable of being tendered being
paid by the Company to N+1 Singer;
N+1 Singer shall purchase on-market at the Tender Price the
Ordinary Shares successfully tendered. The Company has agreed that
conditional on N+1 Singer or an affiliate becoming the registered
and beneficial owner of the Ordinary Shares tendered pursuant to
the Tender Offer by no later than 31 January 2015, upon receipt of
written notice from N+1 Singer, it shall repurchase the Ordinary
Shares acquired by N+1 Singer pursuant to the Tender Offer.
Procedure for Tendering Ordinary Shares
Qualifying Shareholders may offer to sell Ordinary Shares in the
Tender Offer at a fixed price of 12.25 pence per Ordinary Share in
accordance with Part III of the Circular. The procedure for
tendering Ordinary Shares depends on whether your Ordinary Shares
are held in certificated or uncertificated form and is summarised
below.
If you are in any doubt as to the procedure for acceptance,
please contact the Receiving Agent either:
-- by telephone on 0871 664 0321 from within the UK or +44 20
8639 3399 if calling from outside the UK. Lines are open between
9.00 a.m. and 5.30 p.m. (London time) Monday to Friday. Calls to
the 0871 664 0321 number cost 10 pence per minute (including VAT)
plus your service provider's network extras. Calls to the helpline
from outside the UK will be charged at applicable international
rates. Different charges may apply to calls from mobile telephones
and calls may be recorded and randomly monitored for security and
training purposes. The helpline cannot provide advice on the merits
of the proposals set out in the Circular nor give any financial,
legal or tax advice; or
-- at the address set out below. You are reminded that, if you
are a CREST sponsored member, you should contact your CREST sponsor
before taking any action.
Ordinary Shares held in certificated form
Qualifying Shareholders who hold Ordinary Shares in certificated
form and wish to tender some or all of their Ordinary Shares, on
the terms set out in Part III of the Circular, should complete the
Tender Form in accordance with the instructions set out therein and
in Part III of the Circular, and return the completed Tender Form
by post to, Capita Asset Services, Corporate Actions, The Registry,
34 Beckenham Road, Beckenham, Kent BR3 4TU or by hand (during
normal business hours only) to Capita Asset Services, to arrive no
later than 1.00 p.m. on 7 January 2015.
Qualifying Shareholders who hold their Ordinary Shares in
certificated form must also return the share certificate(s) and/or
other document(s) of title in respect of the Ordinary Shares
tendered with their Tender Form.
Ordinary Shares in uncertificated form
Qualifying Shareholders who hold Ordinary Shares in
uncertificated form (that is, in CREST) and who wish to tender some
or all of their Ordinary Shares, on the terms set out in Part III
of the Circular, should send a TTE Instruction and follow the
procedures set out in Part III of the Circular in respect of
tendering uncertificated Ordinary Shares.
Completed Tender Forms and/or TTE Instructions (as appropriate)
must be received by the Receiving Agent no later than 1.00 p.m. on
7 January 2015. Qualifying Shareholders should note that Ordinary
Shares, once tendered, may not be sold, transferred, charged or
otherwise disposed of other than in accordance with the Tender
Offer.
Although the Tender Form (in respect of certificated Ordinary
Shares) must be returned by 1.00 p.m. on 7 January 2015, the
purchase by N+1 Singer of the Ordinary Shares tendered by
Qualifying Shareholders will not be effected until on or about 9
January 2015. Upon having returned a Tender Form, a Qualifying
Shareholder is deemed to accept that their tender application may
not be withdrawn or cancelled before that date.
Terms and conditions and full details of the procedure for
tendering Ordinary Shares are set out in Part III of the Circular
and (for Qualifying Shareholders holding Ordinary Shares in
certificated form) in the Tender Form.
General Meeting
Implementation of the Tender Offer requires the approval of
Shareholders at a General Meeting. Accordingly, a notice is set out
at the end of the Circular convening the General Meeting to be held
at the offices of Eversheds LLP at Bridgewater Place, Water Lane,
Leeds LS11 5DR at 11.00 a.m. on 19 December 2014.
The Resolution will be proposed at the General Meeting as a
special resolution to seek Shareholder approval for the Company to
make on-market purchases of up to a maximum of 10,000,000 Ordinary
Shares from N+1 Singer at a fixed price of 12.25 pence per Ordinary
Share pursuant to the Tender Offer. The authority sought will
expire on 19 June 2015.
Action to be taken by Shareholders
General Meeting
Your vote is important. Whether or not Shareholders plan to
attend the General Meeting, they are encouraged to sign, date and
return the Form of Proxy in accordance with the instructions
contained thereon so as to arrive at Capita Registrars as soon as
possible and, in any event, no later than 11.00 a.m. on 17 December
2014, by posting the Form of Proxy or delivering it by hand (during
normal business hours only) to Capita Asset Services, PXS, The
Registry, 34 Beckenham Road, Beckenham, Kent BR3 4TU. If
Shareholders hold their Ordinary Shares in uncertificated form
(i.e. in CREST), they may appoint a proxy by completing and
transmitting a CREST Proxy Instruction in accordance with the
procedures set out in the CREST Manual so that it is received by
the Registrar (under CREST participant RA10) by no later than 11.00
a.m. on 17 December 2014.
Tender Offer
If you are a Qualifying Shareholder and wish to participate in
the Tender Offer, you should follow the procedure for acceptance
set out in Part III of the Circular and the further terms and
conditions set out in Part III of the Circular.
Irrevocable Undertakings
The Company has received irrevocable undertakings from
Shareholders in respect of a total of 8,905,721 Ordinary Shares
(representing 19.3 per cent. of the total issued Ordinary Shares)
to vote or procure that Ordinary Shares held on their account are
voted in favour of the Resolution.
Each of the Directors has undertaken irrevocably to the Company
and N+1 Singer that they will either not accept the Tender Offer or
procure that the Tender Offer is not accepted in respect of their
aggregate holding of 4,780,721 Ordinary Shares, representing
approximately 10.3 per cent. of the total issued Ordinary
Shares.
Overseas Shareholders
The Tender Offer is not available to Shareholders with an
address in the United States, Canada, Australia, New Zealand, the
Republic of Ireland, the Republic of South Africa or Japan or any
other Restricted Jurisdiction. Overseas Shareholders should note
that they should satisfy themselves that they have fully observed
any applicable legal requirements under the laws of their relevant
jurisdiction if they tender Ordinary Shares in the Tender
Offer.
The attention of Shareholders who are not resident in the United
Kingdom is drawn to the section headed "Overseas Shareholders" in
Part III of the Circular.
Taxation
A general summary of the UK taxation implications of the Tender
Offer is set out in further detail in Part IV of the Circular.
Shareholders are encouraged to seek further tax advice if they are
in doubt as to their tax position.
Recommendation
The Directors believe that the Tender Offer is in the best
interests of Shareholders as a whole. The Directors therefore
unanimously recommend that you vote in favour of the Resolution as
they intend to do in respect of their own interests in 4,780,721
Ordinary Shares in aggregate, representing approximately 10.3 per
cent. of the Ordinary Shares currently in issue. The Directors and
persons associated or connected with them have undertaken not to
accept the Tender Offer in respect of their respective interests in
4,780,721 Ordinary Shares in aggregate, representing approximately
10.3 per cent. of the Ordinary Shares currently in issue.
The Directors and N+1 Singer make no recommendation to
Shareholders in relation to participation in the Tender Offer
itself. Whether or not Shareholders decide to tender all or any of
their Ordinary Shares will depend, among other things, on their
view of the Company's prospects and their own individual
circumstances, including their tax position. Shareholders are
recommended to consult their duly authorised independent advisers
and make their own decision.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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