RNS Number:9060O
Mouchel plc
21 August 2003
Not for release, distribution or publication in or into the United States of
America, Canada, Japan or Australia.
Embargoed until 7.00 a.m.
21 August 2003
Proposed Merger of Mouchel plc and Parkman Group plc
to create Mouchel Parkman plc
* The boards of Mouchel and Parkman announce the terms of an all share
merger of the two companies to be effected by means of a recommended offer, to
be made by Cazenove on behalf of Mouchel, for the entire issued and to be issued
share capital of Parkman.
* The Offer is conditional on, amongst other things, the approval of
Mouchel Shareholders. Mouchel will also be seeking shareholder approval to
change its name to Mouchel Parkman plc, conditional on the Offer becoming or
being declared unconditional in all respects.
* The Merger has been unanimously recommended by the board of Parkman which
has been advised by Rothschild and Hoare Govett.
* The Offer will be 1.2305 New Mouchel Shares for each Parkman Share.
* The Merger terms are based on the recent relative market capitalisations
of the two companies. Upon completion of the Merger, Mouchel Shareholders will
hold approximately 58.9 per cent. and Parkman Shareholders will hold
approximately 41.1 per cent. of the issued share capital of the Combined Group.
* The Merger will enable both businesses to scale up significant parts of
their operations in the areas of highways, infrastructure and asset management.
The Combined Group will have a total order book of #704 million (excluding
possible extensions to term contracts). The Combined Group will be a more
forceful competitor in the market place and better placed to bid for, win and
participate in, larger outsourcing contracts and contracts that require an
element of private sector investment.
* The Directors of the Combined Group estimate that the Merger will lead to
a reduction in the annualised operating costs of the Combined Group of
approximately #2.0 million in the first full financial year following completion
of the Merger.
* The Directors of the Combined Group will be drawn equally from Mouchel
and Parkman. Richard Benton will continue as non-executive Chairman, Richard
Cuthbert will be appointed as Chief Executive and Kevin Young will remain as
Group Finance Director.
* Mouchel today announces a second interim dividend of 1.45 pence per
Mouchel Share payable on 3 October 2003 to Mouchel Shareholders on the register
as at 5 September 2003. Parkman Shareholders will not be eligible to receive
this second interim dividend.
* Parkman today announces an interim dividend of 0.77 pence per Parkman
Share payable on 3 October 2003 to Parkman Shareholders on the register as at 5
September 2003.
* Mouchel has received undertakings to accept the Offer from the Parkman
Directors and other Parkman Shareholders amounting in aggregate to 9,142,687
Parkman Shares, representing approximately 26.0 per cent. of Parkman's current
issued share capital.
* The Mouchel Directors and the No 1 ESOP have undertaken to vote in favour
of the Merger in respect of 11,442,672 Mouchel Shares, representing
approximately 18.5 per cent. of Mouchel's current issued share capital.
The above summary is to be read in conjunction with the full text of this
announcement.
Commenting on the Merger, Richard Benton, Chairman of Mouchel, said:
"The board of Mouchel is delighted to announce the proposed Merger, which will
create a dynamic force in the growing market for support services. The Combined
Group will have the critical mass, expertise and experience to exploit existing
and future opportunities for the benefit of shareholders, employees and
customers."
Richard Archer, Chairman of Parkman, said:
"I am delighted that we have been able to agree merger terms with Mouchel.
Parkman and Mouchel are highly complementary businesses. The Combined Group
will have outstanding people and greater financial resources. This enhanced
strength will allow Mouchel Parkman, as the new group will be called, to play a
significant role in winning and servicing longer term and larger contracts
across a growing range of sectors."
A presentation to analysts will be held at 9.30 a.m. today, 21 August 2003 at
the offices of Citigate Dewe Rogerson, 26 Finsbury Square, London EC2A 1SH.
Enquiries
Mouchel Richard Benton 020 7638 9571 until 2.00 p.m.
Kevin Young and 01932 337118 thereafter
Cazenove Nick Garrett 020 7588 2828
Citigate Dewe Rogerson Sue Pemberton 020 7638 9571
Rupert Steveney
Parkman Richard Archer 07785 356356
Richard Cuthbert 07850 836704
Rothschild Paul Simpson 0121 600 5252
Roger Hemming
Hoare Govett Andrew Osborne 020 7678 8000
Justin Jones
Sean Wegerhoff
Buchanan Richard Darby 020 7466 5000
Communications Suzanne Brocks
Cazenove, which is regulated in the United Kingdom by the Financial Services
Authority, is acting for Mouchel and for no one else in connection with the
Offer and will not be responsible to anyone other than Mouchel for providing the
protections afforded to clients of Cazenove nor for providing advice in relation
to the Offer or any matter referred to herein or in the Offer Document.
Rothschild, which is regulated in the United Kingdom by the Financial Services
Authority, is acting for Parkman and for no one else in connection with the
Offer and will not be responsible to anyone other than Parkman for providing the
protections afforded to clients of Rothschild nor for providing advice in
relation to the Offer or any matter referred to herein or in the Offer Document.
Hoare Govett, which is regulated in the United Kingdom by the Financial Services
Authority, is acting for Parkman and for no one else in connection with the
Offer and will not be responsible to anyone other than Parkman for providing the
protections afforded to clients of Hoare Govett nor for providing advice in
relation to the Offer or any matter referred to herein or in the Offer Document.
This announcement does not constitute, or form part of, any offer for, or any
solicitation of any offer for, securities. Any acceptance or other response to
the Offer should be made only on the basis of information referred to in the
Offer Document which Mouchel intends to despatch shortly to Parkman Shareholders
and, for information only, to holders of options under the Parkman Share Option
Schemes.
The availability of the Offer to persons not resident in the United Kingdom may
be affected by the law of the relevant jurisdiction. Such persons should inform
themselves about and observe any applicable requirements.
The Offer will not be made, directly or indirectly, in or into, or by use of the
mails, or by any means or instrumentality (including, but not limited to,
facsimile transmission or other electronic transmission, telex or telephone) of
interstate or foreign commerce, or any facilities of a national, state or other
securities exchange, of the United States, nor will it be made, directly or
indirectly, in or into Canada, Australia or Japan and will not be capable of
acceptance by any such use, means, instrumentality or facilities or from within
the United States, Canada, Australia or Japan. Accordingly, copies of this
announcement are not being, and must not be, mailed or otherwise distributed or
sent in or into or from, the United States, Canada, Australia or Japan.
This announcement is not an offer of securities for sale in the United States
and the New Mouchel Shares have not been, and will not be, registered under the
US Securities Act or under the securities laws of any state, district or other
jurisdiction of the United States, Canada, Australia or Japan and no regulatory
clearances in respect of the New Mouchel Shares have been, or will be, applied
for in any jurisdiction other than the UK. Accordingly, unless an exemption
under the US Securities Act or other relevant securities laws is applicable, the
New Mouchel Shares are not being, and may not be, offered, sold, resold,
delivered or distributed, directly or indirectly, in or into the United States,
Canada, Australia or Japan or to, or for the account or benefit of, any US
person or any person resident in Canada, Australia or Japan.
This announcement contains a number of forward-looking statements relating to
Mouchel, Parkman and the Combined Group with respect to, among others, the
following: financial condition; results of operations; the business of the
Combined Group; future benefits of the transaction; and management plans and
objectives. Mouchel and Parkman consider any statements that are not historical
facts as "forward-looking statements". They involve a number of risks and
uncertainties that could cause actual results to differ materially from those
suggested by the forward-looking statements. Important factors that could cause
actual results to differ materially from estimates or forecasts contained in the
forward-looking statements include, among others, the following possibilities:
future revenues are lower than expected; costs or difficulties relating to the
integration of the businesses of Mouchel and Parkman, or of other future
acquisitions, are greater than expected; expected cost savings from the
transaction or from other future acquisitions are not fully realised or realised
within the expected time frame; competitive pressures in the industry increase;
general economic conditions or conditions affecting the relevant industries,
whether internationally or in the places Mouchel and Parkman do business, are
less favourable than expected, and/or conditions in the securities market are
less favourable than expected.
Not for release, distribution or publication in or into the United States of
America, Canada, Japan or Australia.
Embargoed until 7.00 a.m.
21 August 2003
Proposed Merger of Mouchel plc and Parkman Group plc
to create Mouchel Parkman plc
1. Introduction
The boards of Mouchel and Parkman announce that they have reached agreement on
the terms of an all share merger of the two companies to be effected by means of
a recommended offer, to be made by Cazenove on behalf of Mouchel, for the entire
issued and to be issued share capital of Parkman. The Merger terms are based on
the relative market capitalisations of the two companies during the 42 day
period ending the day before the date of this announcement. In the view of the
directors of Mouchel and Parkman, the Merger terms reflect the relative
contributions of Mouchel and Parkman to the profitability and prospects of the
Combined Group. Upon completion of the Merger, Mouchel Shareholders will hold
approximately 58.9 per cent. and Parkman Shareholders will hold approximately
41.1 per cent. of the issued share capital of the Combined Group.
2. The Offer
The Offer, which will be subject to the conditions and further terms set out
below and in Appendix I to this announcement and to the conditions and further
terms to be set out in full in the Offer Document and the Form of Acceptance,
will be made on the following basis:
for each Parkman Share 1.2305 New Mouchel Shares
and so in proportion for any other number of Parkman Shares held.
The Offer values the current issued share capital of Parkman at approximately
#78.3 million and each Parkman Share at 222.7 pence. For illustrative purposes,
the financial effects of acceptance of the Offer are set out in Appendix II to
this announcement.
Full acceptance of the Offer (assuming full exercise of options under the
Parkman Share Option Schemes and the issuance of Parkman Shares pursuant to
existing contractual obligations) would involve the issue of up to 46,063,625
New Mouchel Shares (representing approximately 42.6 per cent. of the enlarged
issued share capital of the Combined Group).
As fractions of New Mouchel Shares will not be allotted or issued to persons
accepting the Offer, fractional entitlements to New Mouchel Shares will be
aggregated and sold in the market and the net proceeds of sale will be retained
for the benefit of the Combined Group.
The Parkman Shares will be acquired pursuant to the Offer fully paid and free
from all liens, charges, equitable interests, encumbrances and rights of
pre-emption and any other interests of any nature whatsoever and together with
all rights now or hereafter attaching thereto including voting rights and the
right to receive all dividends or other distributions declared made or paid
after the date of the Offer, other than the Parkman interim dividend announced
today and referred to below, which will be paid on 3 October 2003 to Parkman
Shareholders on the register on 5 September 2003.
The New Mouchel Shares will be issued credited as fully paid and will rank pari
passu in all respects with existing Mouchel Shares and will be entitled to all
dividends and other distributions declared, made or paid after the date of the
Offer, save for the second interim dividend announced today and referred to
below, which will be paid on 3 October 2003 to Mouchel Shareholders on the
register on 5 September 2003.
3. Recommendation
The board of Parkman, which has been so advised by Rothschild and Hoare Govett,
its joint financial advisers, considers the terms of the Offer to be fair and
reasonable. In providing their advice to the board of Parkman, Rothschild and
Hoare Govett have taken into account the commercial assessments of the board of
Parkman. Accordingly, the board of Parkman will unanimously recommend Parkman
Shareholders to accept the Offer.
4. Irrevocable undertakings
The Parkman Directors, certain members of their families and certain members of
Parkman's senior management have entered into agreements with Mouchel pursuant
to which they have irrevocably undertaken to accept the Offer in respect of
their own beneficial holdings amounting in aggregate to 9,142,687 Parkman
Shares, representing approximately 26.0 per cent. of the current issued share
capital of Parkman. The terms of these irrevocable undertakings require
acceptance of the Offer even in the event of a higher competing offer being made
for Parkman by a third party, unless the Offer is withdrawn or lapses.
5. Background to, reasons for and benefits of the Merger
The general trend towards outsourcing and the UK government's agenda to improve
the quality of public services have provided opportunities for both Mouchel and
Parkman to grow rapidly in recent years. The two groups are at similar stages
of their strategic development, having built substantial outsourced managed
services businesses with highly visible future earnings streams. The two
companies entered into discussions earlier in the year to explore the potential
growth opportunities and benefits that a combination of the two businesses could
bring.
Both Mouchel and Parkman focus on a common strategy of building their
outsourcing businesses by winning quality, long term contracts from selected
large public and private sector clients. This is underpinned in each case by a
core consultancy business, which has been enhanced by the accumulation of niche
consultancy skills through selective strategic acquisitions. Both Mouchel and
Parkman provide a similar offering to clients in the areas of highways
management, infrastructure management and asset management and they operate in
largely common sectors in the UK such as road, rail, education and industry.
The combination of Mouchel and Parkman will therefore enable both businesses to
scale up significant parts of their operations. For example, following the
Merger, the Combined Group will become a key player in the management of local
government highways and property.
In addition, the two businesses operate in a number of complementary areas.
Whilst Mouchel has enjoyed particular success in the management of roads and
infrastructure, with a pre-eminent position in central government highway
management as a result of its six Highways Agency Super Agency contracts,
merging with Parkman will accelerate its move into new sectors such as water and
social housing management, as well as strengthening its position in rail and
education. Parkman brings particular strengths to the Combined Group in local
government outsourcing and strategic alliances, having recently been selected as
preferred bidder by Liverpool City Council as its private sector partner in a
joint venture providing "bundled" professional services. Another area in which
the two businesses complement each other is the combination of Parkman's
expertise in local authority highway management operations in London for TfL and
a number of the London local authorities, with Mouchel's local authority
highways activities elsewhere in the UK.
The Combined Group will have a total of 67 managed services contracts and a
total order book of #704 million on a run-rate basis and #590 million on an
advertised value basis (in each case, excluding possible extensions to term
contracts).
The Directors of the Combined Group believe that the combination of Mouchel's
expertise with that of Parkman will strengthen considerably the Combined Group's
proposition when bidding for new contracts and will enable the Combined Group to
deliver an enhanced service offering to the existing clients of Mouchel and
Parkman. Furthermore, the stronger balance sheet of the Combined Group will
make it a more forceful competitor in the marketplace and better placed to bid
for, win and participate in, larger outsourcing contracts and contracts that
require an element of private sector investment, such as the Highways Agency
PFMAC contracts and local authority roads PFI commissions. The Combined Group
will also be better placed to take advantage of strategic acquisition
opportunities to support the development of its managed services business as
they arise.
Based on the closing middle market prices on 20 August 2003 (being the last day
of dealings before the announcement of the Offer), the Combined Group would be
capitalised at approximately #190.6 million on a pro forma basis. The Directors
of the Combined Group believe that the Merger will raise the status and market
profile of the Combined Group and promote greater awareness than each of Mouchel
and Parkman currently enjoy. This increased awareness will, in the opinion of
the Directors of the Combined Group, allow it to build on Mouchel and Parkman's
existing ability to attract and retain new business.
The Merger will allow the Combined Group to draw upon the expertise and
experience of the boards and management teams of both groups. Richard Benton
and Kevin Young, the respective non-executive Chairman and Group Finance
Director of Mouchel will remain as non-executive Chairman and Group Finance
Director respectively of the Combined Group and Richard Cuthbert, the Chief
Executive of Parkman, will become Chief Executive of the Combined Group. As a
result, the Merger addresses succession planning at Mouchel following the
announcement in April 2003 that Jim Harding would be stepping down as Chief
Executive at the end of September 2003 on reaching his normal retirement age.
Given the shortage of experienced individuals in the industry, the Directors of
the Combined Group also believe that another important benefit of the Merger is
that it will enhance the Combined Group's ability to attract, recruit and retain
high calibre professionals.
The Directors of the Combined Group estimate that the Merger will lead to a
reduction in the annualised operating costs of the Combined Group of
approximately #2.0 million in the first full financial year following completion
of the Merger. The cost of achieving these savings is estimated to be
approximately #1.1 million. As a consequence, the Mouchel Directors believe
that the Merger will be earnings enhancing for Mouchel in the first full year
following completion of the Merger.
Given the good progress made by both companies in recent months and the benefits
of the Merger outlined above, the Directors of the Combined Group are confident
about the prospects of the Combined Group for the current financial year.
Nothing in this announcement should be construed as a profit forecast or be
interpreted to mean that the earnings per share of the Combined Group for the
current or future years would necessarily be greater than Mouchel's historic
earnings per share.
6. Information relating to the Mouchel Group and second interim dividend
Business
Mouchel is a professional services group supporting blue chip clients in
developing and managing their infrastructure assets. Mouchel's contracts range
from operational management of road networks, bridges and public buildings to
providing school improvement and support services in partnership with local
education authorities.
Mouchel provides public services to more than six million people in local
communities across the UK and has contracts for maintaining and developing
approximately 1,700 schools, 1,600 public buildings, 19,000 hectares of public
estate land, 29,000 kilometres of public roads and 4,500 bridges.
Mouchel delivers services through three business streams which work closely
together:
- Managed Services - operational management of services under long
term partnership contracts;
- Project Services - project management and specialist technical
services; and
- Management Consultancy - strategic infrastructure planning and
management advice.
The Group seeks to provide comprehensive services to support infrastructure
owners through the whole life cycle of their assets, ranging from strategic
planning to operational management.
Mouchel focuses on market sectors which have a significant infrastructure asset
base requiring:
- complex operational management;
- significant maintenance expenditure; and
- new solutions for management and funding.
Mouchel has specific technical expertise and client knowledge in its selected
market sectors: central and local government roads, local government property,
defence, rail, education, ports and marine, oil and gas, and waste.
Mouchel's long term managed services contracts provide a solid platform for
growth. It has an order book that had grown to #469 million on a run-rate basis
and #375 million on an advertised value basis (in each case, excluding future
extensions) as at 31 July 2003, a 20 per cent. increase on 31 July 2002 (on a
run-rate basis). The significant growth in the forward order book reflects the
strong visibility of revenues in the Mouchel Group's Managed Services business,
which accounts for approximately 94 per cent. of the Mouchel Group's forward
workload.
Mouchel floated on the London Stock Exchange in June 2002. For the year ended
31 July 2002, Mouchel reported pre-exceptional profit before tax and
amortisation of goodwill of #5.5 million and turnover of #102.4 million. For
the six months to 31 January 2003, Mouchel had turnover of #66.9 million and
profit before tax and amortisation of goodwill of #2.7 million. Mouchel employs
2,200 professional and support staff and operates from 15 principal offices in
the UK and a small number overseas.
Current trading
Mouchel issued the following pre-close trading update on 16 July 2003:
"Mouchel plc, the professional support services group, today reports on trading
for the year ending 31 July 2003, prior to entering its close period.
In Managed Services, the Group's primary business, activity levels continue to
increase as new contracts in highways and rail are brought on stream. We have
commenced the operation of the Area 13 contract, which was secured in January
2003. The sales pipeline remains buoyant and we continue to evaluate a number
of further opportunities for new business.
Overall, the Group continues to make good progress and, with the increased
activity levels referred to above, expects to report a very positive position at
the year end.
Richard Benton, Chairman of Mouchel plc, commented:
"I am really pleased with the progress made in the second half of the year in
all our areas of operations. I am confident that trading for the full year will
again reflect significant growth in the business and will see a strong and
secure order book for the coming year. We continue to evaluate a number of new
business opportunities and look to the future with continuing confidence." "
Second interim dividend
The Mouchel Directors today announce that a second interim dividend of 1.45
pence per Mouchel Share will be paid, in lieu of the final dividend, on 3
October 2003 to Mouchel Shareholders on the share register of Mouchel on 5
September 2003. The second interim dividend is being declared in respect of the
six months to 31 July 2003 and, together with the first interim dividend of 0.75
pence, makes a total dividend for the year to 31 July 2003 of 2.2 pence.
Parkman Shareholders will not be entitled to receive the second interim
dividend, although they will be entitled to receive all other future dividends
declared by the Combined Group.
7. Information relating to the Parkman Group and interim dividend
Business
Parkman is a multi-skilled professional services business that works extensively
with national, regional and local government, privatised utilities, rail
infrastructure operators, education authorities and in the defence sector,
providing a wide range of technical and managerial expertise.
The business concentrates on the provision of outsourced asset management and
support services together with consulting engineering services. Outsourcing
activities accounted for 62 per cent. of total turnover for the year ended 31
March 2003.
The Parkman Group provides its services to a range of public and private sector
clients across a number of markets including those set out below:
Outsourcing Consulting
Highways Highways
Rail Rail
Property and housing Environment
Water Water
Defence Property and housing
Education Land services
In the year ended 31 March 2003, over 90 per cent. of Parkman's turnover derived
from within the public and privatised utility and infrastructure sectors with
nearly 70 per cent. of this revenue being transport related and 15 per cent.
arising from water and environmental services.
In many cases, Parkman's outsourcing business relationships take the form of
joint ventures and other partnerships and increasingly include a combination of
services, all of which are characterised by long term contracts and a high
visibility of future workload which provides a strong base for the expansion of
the business.
The growing importance of long term outsourcing contracts to Parkman is
reflected in its order book which stood at over #235 million (on a run-rate
basis, excluding future extensions) as at 31 July 2003, more than double the
level at the same time in the prior year, demonstrating the strong visibility of
Parkman's business going forward.
Parkman has grown strongly since it floated on the London Stock Exchange in July
2001. For the year ended 31 March 2003, Parkman reported pre-tax profit (before
interest, amortisation of goodwill and exceptional finance charges) of #4.6
million (2002: #3.0 million) on net turnover of #57.6 million (2002: #45.8
million). Furthermore, since the year end, Parkman has announced that it has
been named as preferred bidder on a major outsourcing partnership contract with
Liverpool City Council to provide property and transport services. The contract
is worth some #100 million to Parkman over its initial ten year period and can
be extended for a further ten years. This will be the largest contract ever won
by the Parkman Group and is the first of what is expected to be a number of such
contracts of "bundled" services released by local authorities. Parkman employs
over 1,500 professional and support staff and operates from offices throughout
the UK, Ireland and overseas.
Current trading
At the time of Parkman's annual general meeting on 1 August 2003, the following
trading update was released:
"The first quarter of the current financial year has delivered continued growth
in activity levels in line with the Board's expectations. Turnover for the three
months ended 30 June 2003 was significantly ahead of the same period in the
previous year.
Order books are at new record levels of #235 million, compared to #96 million at
the same time last year, and our pipeline now exceeds #250 million. In addition,
the recent acquisition of Atkins Odlin will enable us to widen our service
offering and so create further opportunities for the Parkman Group.
We remain very confident of our prospects for the current financial year."
Interim dividend
The Parkman Directors have today announced an interim dividend of 0.77 pence
per Parkman Share which will be paid on 3 October 2003 to Parkman Shareholders
on the register of Parkman on 5 September 2003.
8. Board of the Combined Group and employees
The Directors of the Combined Group will be drawn equally from Mouchel and
Parkman as follows:
Non-executive Chairman Richard Benton Mouchel
Chief Executive Richard Cuthbert Parkman
Group Finance Director Kevin Young Mouchel
Non-executive Directors Richard Archer Parkman
Jim Harding Mouchel
Ian Knight Mouchel
Professor Sir Michael Lyons Parkman
Rodney Westhead Parkman
Upon the Offer becoming or being declared unconditional in all respects, Jim
Harding will resign as Chief Executive of Mouchel, but remain on the board of
the Combined Group as a non-executive director. At that time, Richard Cuthbert,
the current Chief Executive of Parkman will join the board of the Combined Group
as Chief Executive and Richard Archer, Professor Sir Michael Lyons and Rodney
Westhead will also join the board of the Combined Group as non-executive
directors. The remaining Parkman Directors have agreed to stand down from the
board of Parkman upon the Offer becoming or being declared unconditional in all
respects.
Mouchel has confirmed that the existing employment rights, including pension
rights, of the management and employees of Parkman will be fully safeguarded.
9. Lock-ups
Richard Archer (Chairman of Parkman), Richard Preece (Company Secretary of
Parkman), Ian Howitt (Finance Director of Parkman) and Graham Kilner (previously
Business Expansion Director of Parkman) have agreed to restrictions on dealings
in their holdings of New Mouchel Shares broadly equivalent to those to which the
Mouchel Directors and certain other Mouchel Shareholders are currently subject
("Existing Mouchel Restrictions"). Consequently, they have undertaken with each
of Cazenove and the Company that they will not, without the prior consent of
Cazenove, subject to the Offer becoming or being declared unconditional in all
respects and to certain limited exceptions, dispose of any New Mouchel Shares at
any time except as follows:
(i) as to 50 per cent. between the date on which the Mouchel Group's
preliminary results for the financial year ended 31 July 2003 are announced and
the date on which the Mouchel Group's preliminary results for the financial year
ending 31 July 2004 are announced (the "Release Date");
(ii) as to the remainder, after the Release Date; and
(iii) as to their entire holding, in the event that the restricted
shareholder's employment is terminated.
The Existing Mouchel Restrictions have also been amended to reflect the
exceptions set out in (i), (ii) and (iii) above.
10. Parkman Share Option Schemes
The Offer will extend to any Parkman Shares unconditionally issued or allotted
while the Offer remains open for acceptance (or by such earlier date as Mouchel
may, subject to the City Code or with the consent of the Panel, determine)
including any such shares allotted or issued pursuant to the exercise of Parkman
Options. Mouchel intends to make proposals to the holders of Parkman Options to
roll-over their Parkman Options into options over Mouchel Shares subject to the
Offer becoming or being declared unconditional in all respects. The proposed
new options over Mouchel shares will be on no less favourable terms and
conditions than those of the existing Parkman Options.
11. Mouchel Extraordinary General Meeting
Given the size of the proposed transaction, in order to implement the Offer it
will be necessary for the Mouchel Shareholders to approve the Offer and to
authorise an increase in the share capital of Mouchel and the allotment of the
New Mouchel Shares. An Extraordinary General Meeting will be convened for this
purpose. At the Extraordinary General Meeting, Mouchel will also seek approval
for the Company to change its name to Mouchel Parkman plc, conditional on the
Offer becoming or being declared unconditional in all respects. The circular
containing the notice of Extraordinary General Meeting will be sent to Mouchel
Shareholders shortly.
The Mouchel Directors will unanimously recommend Mouchel Shareholders to vote in
favour of the resolutions set out in the notice of Extraordinary General
Meeting, as they have undertaken to do in respect of their own beneficial
shareholdings amounting to 2,935,380 Mouchel Shares, representing approximately
4.7 per cent. of Mouchel's current issued share capital. In addition, the No 1
ESOP has undertaken the vote in favour of the resolutions set out in the notice
of Extraordinary General Meeting in respect of 8,507,292 Mouchel shares held in
that trust, representing approximately 13.7 per cent. of Mouchel's current
issued share capital. In total, therefore, undertakings have been given in
respect of 11,442,672 Mouchel Shares, representing approximately 18.5 per cent.
of Mouchel's current issued share capital.
12. Delisting and compulsory acquisition
If the Offer becomes or is declared unconditional in all respects, Mouchel
intends to procure the making of an application by Parkman to delist the Parkman
Shares from the Official List and to cancel trading on the London Stock
Exchange's market for listed securities. It is anticipated that cancellation of
listing and trading will take effect no earlier than 20 Business Days after the
Offer becomes or is declared unconditional in all respects. Delisting would
significantly reduce the liquidity and marketability of any Parkman Shares not
assented to the Offer.
If Mouchel receives acceptances under the Offer in respect of, and/or otherwise
acquires, 90 per cent. or more of the Parkman Shares to which the Offer relates,
Mouchel intends to exercise its rights pursuant to the provisions of sections
428 to 430F (inclusive) of the Companies Act to acquire compulsorily the
remaining Parkman Shares.
13. Listing, dealings and settlement
Application will be made to the UK Listing Authority for the New Mouchel Shares
to be admitted to the Official List and application will be made to the London
Stock Exchange for the New Mouchel Shares to be admitted to trading on the
London Stock Exchange's market for listed securities. It is expected that
Admission will become effective and that dealings for normal settlement in the
New Mouchel Shares will commence on the London Stock Exchange at 8.00 a.m. on
the first dealing day following the date on which the Offer becomes or is
declared unconditional in all respects (subject only to the condition relating
to Admission contained in paragraph 1(c) of Appendix I to this announcement).
14. Inducement fees
It has been agreed between Mouchel and Parkman that Parkman will pay Mouchel a
fee of #600,000 if the board of Parkman withdraws its recommendation of the
Offer or if, prior to the withdrawal or lapse of the Offer, a higher competing
offer for Parkman is announced and such offer subsequently becomes or is
declared unconditional in all respects or is otherwise completed or implemented.
It has also been agreed between Mouchel and Parkman that Mouchel will pay
Parkman a fee of #600,000 if the Mouchel Shareholders do not pass the
resolutions to approve the Offer and to create and authorise the issue of the
New Mouchel Shares, which are to be proposed at the Extraordinary General
Meeting of Mouchel.
15. Securities in issue
As at 7.00 a.m on 21 August 2003 Mouchel has 62,000,000 ordinary shares of 0.25
pence in issue (ISIN number GB0031696858) and Parkman has 35,171,239 ordinary
shares of 1 pence in issue (ISIN number GB0030605843).
16. General
Neither Mouchel, nor any of its directors, nor, so far as Mouchel is aware, any
person deemed to be acting in concert with it, owns or controls any Parkman
Shares or has any option to acquire any Parkman Shares, or has entered into any
derivative referenced to securities of Parkman which remains outstanding.
The Offer will be on the terms and subject to the conditions set out herein and
in Appendix I and to be set out in the Offer Document and Form of Acceptance.
It is intended that the Offer Document (including a letter of recommendation
from the Chairman of Parkman), Forms of Acceptance and Listing Particulars will
be despatched shortly to Parkman Shareholders. Listing Particulars and a
circular explaining the Offer and convening an Extraordinary General Meeting to
seek approval for the Offer, to increase the authorised share capital of
Mouchel, to authorise the Mouchel Directors to issue the New Mouchel Shares and
to approve the change of Mouchel's name to Mouchel Parkman plc will also be
despatched to Mouchel Shareholders shortly.
Appendix III contains the sources and bases for certain information set out in
this announcement.
Appendix IV contains the definitions used in this announcement.
Cazenove, which is regulated in the United Kingdom by the Financial Services
Authority, is acting for Mouchel and for no one else in connection with the
Offer and will not be responsible to anyone other than Mouchel for providing the
protections afforded to clients of Cazenove nor for providing advice in relation
to the Offer or any matter referred to herein or in the Offer Document.
Rothschild, which is regulated in the United Kingdom by the Financial Services
Authority, is acting for Parkman and for no one else in connection with the
Offer and will not be responsible to anyone other than Parkman for providing the
protections afforded to clients of Rothschild nor for providing advice in
relation to the Offer or any matter referred to herein or in the Offer Document.
Hoare Govett, which is regulated in the United Kingdom by the Financial Services
Authority, is acting for Parkman and for no one else in connection with the
Offer and will not be responsible to anyone other than Parkman for providing the
protections afforded to clients of Hoare Govett nor for providing advice in
relation to the Offer or any matter referred to herein or in the Offer Document.
This announcement does not constitute, or form part of, any offer for, or any
solicitation of any offer for, securities. Any acceptance or other response to
the Offer should be made only on the basis of information referred to in the
Offer Document which Mouchel intends to despatch shortly to Parkman Shareholders
and, for information only, to holders of options under the Parkman Share Option
Schemes.
The availability of the Offer to persons not resident in the United Kingdom may
be affected by the laws of the relevant jurisdiction. Such persons should
inform themselves about and observe any applicable requirements.
The Offer will not be made, directly or indirectly, in or into, or by use of the
mails, or by any means or instrumentality (including, without limitation,
facsimile or other electronic transmission, telex or telephone) of interstate or
foreign commerce, or of any facility of a national, state, or other securities
exchange, of the United States, Canada, Australia or Japan and will not be
capable of acceptance by any such use, means, instrumentality or facility or
from within the United States, Canada, Australia or Japan. Accordingly, copies
of this announcement are not being, and must not be mailed or otherwise
distributed or sent in or into or from, the United States, Canada, Australia or
Japan. This announcement is not an offer of securities for sale in the United
States and the New Mouchel Shares have not been, and will not be, registered
under the US Securities Act or under the laws of any state, district or other
jurisdiction of the United States, and the relevant clearances have not been and
will not be obtained from the relevant authorities in Canada, Australia or
Japan. Accordingly, unless an exemption under the US Securities Act or other
relevant securities laws is applicable, the New Mouchel Shares may not be
offered, sold, resold, delivered or distributed, directly or indirectly, in or
into the United States, Canada, Australia or Japan or to, or for the account or
benefit of, any US person or person resident in Canada, Australia or Japan.
This announcement contains a number of forward-looking statements relating to
Mouchel, Parkman and the Combined Group with respect to, among others, the
following: financial condition; results of operations; the businesses of the
Combined Group; future benefits of the transaction; and management plans and
objectives. Mouchel and Parkman consider any statements that are not historical
facts as "forward-looking statements". They involve a number of risks and
uncertainties that could cause actual results to differ materially from those
suggested by the forward-looking statements. Important factors that could cause
actual results to differ materially from estimates or forecasts contained in the
forward-looking statements include, among others, the following possibilities:
future revenues are lower than expected; costs or difficulties relating to the
integration of the businesses of Mouchel and Parkman, or of other future
acquisitions, are greater than expected; expected cost savings from the
transaction or from other future acquisitions are not fully realised or realised
within the expected time frame; competitive pressures in the industry increase;
general economic conditions or conditions affecting the relevant industries,
whether internationally or in the places Mouchel and Parkman do business, are
less favourable than expected, and/or conditions in the securities market are
less favourable than expected.
APPENDIX I
The Offer, which will be made by Cazenove on behalf of Mouchel, will comply with
the applicable rules and regulations of the UK Listing Authority, the London
Stock Exchange and the City Code, will be governed by English law and will be
subject to the jurisdiction of the courts of England. In addition it will be
subject to the terms and conditions set out in the Offer Document and related
Form of Acceptance.
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 Mouchel may, subject to the rules of the City Code or
with the consent of the Panel, decide) in respect of not less than 90 per cent.
(or such lesser percentage as Mouchel may decide) in nominal value of the
Parkman Shares to which the Offer relates, provided that this condition will not
be satisfied unless Mouchel (together with its wholly owned subsidiaries) shall
have acquired or agreed to acquire (pursuant to the Offer or otherwise) Parkman
Shares carrying in aggregate more than 50 per cent. of the voting rights then
exercisable at a general meeting of Parkman, (including for this purpose, to the
extent (if any) required by the Panel) any voting rights attaching to any
Parkman Shares that are unconditionally allotted or issued before the Offer
becomes or is declared unconditional as to acceptances whether pursuant to the
exercise of any outstanding subscription or conversion rights or otherwise.
For the purposes of this condition:
(i) Parkman Shares which have been unconditionally allotted
shall be deemed to carry the voting rights they will carry upon issue; and
(ii) the expression "Parkman Shares to which the Offer relates"
shall be construed in accordance with sections 428 to 430F of the Companies Act;
(b) the passing at an extraordinary general meeting of Mouchel (or at
any adjournment of the meeting) of such resolution or resolutions as are, in the
opinion of Mouchel, reasonably necessary to approve, effect or implement the
Offer;
(c) the UK Listing Authority agreeing to admit the New Mouchel
Shares to the Official List and such admission becoming effective in accordance
with paragraph 7.1 of the Listing Rules and the London Stock Exchange agreeing
to admit the New Mouchel Shares to trading and the admission becoming effective
in accordance with the Admission and Disclosure Standards or (if Mouchel so
determines and subject to the consent of the Panel) the UK Listing Authority and
the London Stock Exchange agreeing to admit such shares to listing and trading
respectively;
(d) it being established to the satisfaction of Mouchel that:
(i) neither the proposed acquisition of Parkman by any member
of the Wider Mouchel Group nor any matters or arrangements arising therefrom or
related thereto will be referred to the Competition Commission in the United
Kingdom;
(ii) it is not and will not be necessary, in order to avoid any
such reference to the Competition Commission, for any member of the Wider
Mouchel Group or member of the Wider Parkman Group to give undertakings to the
Office of Fair Trading except where any such undertakings are on terms which
Mouchel in its entire discretion considers satisfactory; and
(iii) there has been no statement or intervention by the United
Kingdom Office of Fair Trading or the Secretary of State indicating that it is
necessary or desirable for any aspect of the proposed acquisition of Parkman or
any matters or arrangements arising therefrom or related thereto to be altered,
amended or modified except on terms which Mouchel in its entire discretion
considers satisfactory.
(e) no Third Party having decided to take, institute or threaten any
action, proceeding, suit, investigation, enquiry or reference, or having
required any action to be taken or otherwise having done anything or having
enacted, made or proposed any statute, regulation, decision or order and there
not continuing to be outstanding any statute, regulation, decision or order
which would or might:
(i) make the Offer, its implementation or the acquisition or
proposed acquisition of any Parkman Shares by any member of the Wider Mouchel
Group void, unenforceable or illegal or restrict, prohibit, delay or otherwise
interfere with the implementation of, or impose additional conditions or
obligations with respect to, or otherwise challenge or require amendment of the
Offer or the acquisition of any Parkman Shares by any member of the Wider
Mouchel Group;
(ii) require, prevent or delay the divestiture or alter the
terms envisaged for such divestiture by any member of the Wider Mouchel Group or
by any member of the Wider Parkman Group of all or any part of their respective
businesses, assets or properties or impose any limitation on their ability to
conduct their respective businesses or to own any of their respective assets or
properties; to an extent which is material in the context of the Parkman Group
taken as a whole or the Mouchel Group taken as a whole (as the case may be);
(iii) impose any limitation on, or result in a delay in, the
ability of any member of the Wider Mouchel Group to acquire or hold or to
exercise effectively, directly or indirectly, all or any rights of ownership of
shares or other securities (or the equivalent) in Parkman or on the ability of
any member of the Wider Parkman Group or any member of the Wider Mouchel Group
to hold or exercise effectively any rights of ownership of shares or other
securities in or to exercise management control over any member of the Wider
Parkman Group;
(iv) require any member of the Wider Mouchel Group or the Wider
Parkman Group to acquire or offer to acquire any shares or other securities (or
the equivalent) in any member of the Wider Parkman Group or any asset owned by
any third party (other than in the implementation of the Offer);
(v) require, prevent or delay a divestiture, by any member of
the Wider Mouchel Group of any shares or other securities (or the equivalent) in
Parkman;
(vi) result in any member of the Wider Parkman Group ceasing to
be able to carry on business under any name which it presently does so to an
extent which is material in the context of the Parkman Group taken as a whole;
(vii) impose any material limitation on the ability of any member
of the Wider Mouchel Group or any member of the Wider Parkman Group to integrate
or co-ordinate all or any part of its business with all or any part of the
business of any other member of the Wider Mouchel Group and/or the Wider Parkman
Group; or
(viii) otherwise affect the business, assets, profits or prospects
of any member of the Wider Mouchel Group or any member of the Wider Parkman
Group in a manner which is adverse to and material in the context of the Mouchel
Group taken as a whole or the Parkman Group taken as a whole (as the case may
be);
and all applicable waiting and other time periods during which any such Third
Party could decide to take, institute or threaten any such action, proceeding,
suit, investigation, enquiry or reference or otherwise intervene having expired,
lapsed, or been terminated;
(f) all necessary notifications and filings having been made in
connection with the Offer and all necessary waiting periods (including any
extensions thereof) under any applicable legislation or regulation of any
jurisdiction having expired, lapsed or been terminated (as appropriate) and all
statutory and regulatory obligations in any jurisdiction in connection with the
Offer having been complied with and all Authorisations necessary or appropriate
in any jurisdiction for or in respect of the Offer and the acquisition or the
proposed acquisition of any shares or other securities in or control of Parkman
by any member of the Wider Mouchel Group having been obtained in terms and in a
form reasonably satisfactory to Mouchel from all appropriate Third Parties or
(without prejudice to the generality of the foregoing) from any person or bodies
with whom any member of the Wider Parkman Group or the Wider Mouchel Group has
entered into contractual arrangements and all such Authorisations necessary or
appropriate to carry on the business of any member of the Wider Parkman Group in
any jurisdiction having been obtained and all such Authorisations remaining in
full force and effect at the time at which the Offer becomes otherwise
unconditional and there being no notice or intimation of an intention to revoke,
suspend, restrict, modify or not to renew such Authorisations;
(g) except as fairly disclosed in writing to Mouchel prior to 21
August 2003 or as disclosed in the Parkman Annual Accounts or as publicly
announced to a Regulatory Information Service by or on behalf of Parkman before
21 August 2003 there being no provision of any arrangement, agreement, licence,
permit, lease or other instrument to which any member of the Wider Parkman Group
is a party or by or to which any such member or any of its assets is or may be
bound or be subject or any event or circumstance which could, as a consequence
of the Offer or the acquisition or the proposed acquisition by any member of the
Wider Mouchel Group of any shares or other securities (or the equivalent) in
Parkman or because of a change in the control or management of any member of the
Wider Parkman Group or otherwise, could or might reasonably be expected to
result in, to an extent which is material in the context of the Parkman Group
taken as a whole:
(i) any monies borrowed by, or any other indebtedness, actual
or contingent, of any member of the Wider Parkman Group being or becoming
repayable, or capable of being declared repayable, immediately or prior to its
or their stated maturity, or the ability of any such member to borrow monies or
incur any indebtedness being withdrawn or inhibited;
(ii) the rights, liabilities, obligations, interests or
business of any member of the Wider Parkman Group or any member of the Wider
Mouchel Group under any such arrangement, agreement, licence, permit, lease or
instrument or the interests or business of any member of the Wider Parkman Group
or any member of the Wider Mouchel Group in or with any other firm or company or
body or person (or any agreement or arrangements relating to any such business
or interests) being terminated or adversely modified or affected or any onerous
obligation or liability arising or any adverse action being taken thereunder;
(iii) any member of the Wider Parkman Group ceasing to be able
to carry on business under any name under which it presently does so;
(iv) any assets or interests of, or any asset the use of which is
enjoyed by, any member of the Wider Parkman Group being or falling to be
disposed of or charged or any right arising under which any such asset or
interest could be required to be disposed of or charged or could cease to be
available to any member of the Wider Parkman Group otherwise than in the
ordinary course of business;
(v) 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 member of the Wider Parkman Group;
(vi) the value of, or the financial or trading position or
prospects of any member of the Wider Parkman Group being prejudiced or adversely
affected;
(vii) the creation of any liability (actual or contingent) by any
member of the Wider Parkman Group; or
(viii) any liability of any member of the Wider Parkman Group to
make any severance, termination, bonus or other payment to any of the directors
or other officers of the Wider Parkman Group;
(h) except as disclosed in the Parkman Annual Accounts or as
publicly announced to a Regulatory Information Service by or on behalf of
Parkman before 21 August 2003 or as fairly disclosed in writing to Mouchel
before 21 August 2003, no member of the Wider Parkman Group having since 31
March 2003 (except for the interim dividend of 0.77 pence per Parkman Share
announced on 21 August 2003):
(i) issued or agreed to issue or authorised or proposed the
issue of additional shares of any class, or securities or securities convertible
into, or exchangeable for, or rights, warrants or options to subscribe for or
acquire, any such shares or convertible securities (save as between Parkman and
wholly-owned subsidiaries of Parkman and save for the issue of Parkman Shares on
the exercise of options granted before the date of this announcement in the
ordinary course);
(ii) recommended, declared, paid or made or proposed to
recommend, declare, pay or make any bonus, dividend or other distribution other
than a distribution by a wholly owned subsidiary within the Parkman Group
(except for the interim dividend of 0.77 pence per Parkman Share announced on 21
August 2003);
(iii) merged with or demerged or acquired any body corporate,
partnership or business or acquired or disposed of, or, other than in the
ordinary course of business, transferred, mortgaged or charged or created any
security interest over, any assets or any right, title or interest in any asset
(including shares and trade investments) or authorised, proposed or announced
any intention to do so;
(iv) made, authorised, proposed or announced an intention to
propose any change in its loan capital;
(v) issued, authorised or proposed the issue of any debentures
or incurred or increased any indebtedness or contingent liability to an extent
which is material in the context of the Parkman Group;
(vi) entered into or varied or announced its intention to enter
into or vary any contract, transaction, arrangement or commitment (whether in
respect of capital expenditure or otherwise) which is of a long term, unusual or
onerous nature, or which involves or could involve an obligation of a nature or
magnitude which is, in any such case, material in the context of the Parkman
Group or which is or is likely to be materially restrictive on the business of
any member of the Wider Parkman Group or the Wider Mouchel Group;
(vii) entered into or varied the terms of any service agreement
with any director of the Wider Parkman Group;
(viii) proposed, agreed to provide or modified the terms of any
share option scheme, incentive scheme, or other benefit relating to the
employment or termination of employment of any employee of the Wider Parkman
Group which, taken as a whole, are material in the context of the Parkman Group
taken as a whole taken as a whole;
(ix) made or agreed or consented to any significant change to the
terms of the trust deeds constituting the pension schemes established for its
directors, employees or their dependants or the benefits which accrue, or to the
pensions which are payable, thereunder, or to the basis on which qualification
for, or accrual or entitlement to, such benefits or pensions are calculated or
determined or to the basis on which the liabilities (including pensions) of such
pension schemes are funded or made, or agreed or consented to any change to the
trustees involving the appointment of a trust corporation;
(x) implemented, effected or authorised, proposed or announced
its intention to implement, effect, authorise or propose any reconstruction,
amalgamation, commitment, scheme or other transaction or arrangement otherwise
than in the ordinary course of business;
(xi) purchased, redeemed or repaid or proposed the purchase,
redemption or repayment of any of its own shares or other securities or reduced
or made any other change to any part of its share capital;
(xii) waived or compromised any claim otherwise than in the
ordinary course of business which is material in the context of the Parkman
Group taken as a whole;
(xiii) made any alteration to its memorandum or articles of
association or other incorporation documents;
(xiv) taken or proposed any corporate action or had any legal
proceedings instituted or threatened against it for its winding-up (voluntary or
otherwise), dissolution, reorganisation or for the appointment of any
administrator, administrative receiver, trustee or similar officer of all or any
of its assets or revenues or any analogous proceedings in any jurisdiction or
appointed any analogous person in any jurisdiction;
(xv) 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; or
(xvi) entered into any contract, commitment, agreement or
arrangement or passed any resolution with respect to or announced an intention
to effect or propose any of the transactions, matters or events referred to in
this paragraph;
(i) except as disclosed in the Parkman Annual Accounts or as
publicly announced to a Regulatory Information Service by or on behalf of
Parkman before 21 August 2003 or as fairly disclosed in writing to Mouchel
before 21 August 2003, since 31 March 2003:
(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 Parkman Group to an extent which is material in the context of the
Parkman Group taken as a whole;
(ii) no litigation, arbitration proceedings, prosecution or
other legal proceedings having been threatened, announced or instituted by or
against or remaining outstanding against any member of the Wider Parkman Group
or to which any member of the Wider Parkman Group is or may become a party
(whether as plaintiff or defendant or otherwise) and no enquiry or investigation
by or complaint or reference to any Third Party against or in respect of any
member of the Wider Parkman Group having been threatened, announced or
instituted or remaining outstanding, against or in respect of any member of the
Wider Parkman Group which, in any such case, is reasonably likely adversely to
affect any member of the Wider Parkman Group to an extent which is material in
the context of the Parkman Group taken as a whole;
(iii) no contingent or other liability having arisen or become
apparent to Mouchel which is reasonably likely adversely to affect the business,
assets, financial or trading position or profits or prospects of any member of
the Wider Parkman Group to an extent which is material to the Parkman Group
taken as a whole; and
(iv) no steps having been taken and no omissions having been made
which are likely to result in the withdrawal, cancellation, termination or
modification of any licence held by any member of the Wider Parkman Group, which
is necessary for the proper carrying on of its business;
(j) except as fairly disclosed to Mouchel in writing prior to 21
August 2003 Mouchel not having discovered:
(i) that any financial, business or other information
concerning the Wider Parkman Group publicly disclosed or disclosed to any member
of the Wider Mouchel Group at any time by or on behalf of any member of the
Wider Parkman Group which is material in the context of the acquisition of
Parkman by any member of Mouchel Group is misleading, contains a
misrepresentation of fact or omits to state a fact necessary to make the
information contained therein not misleading in any case to an extent which is
material in the context of the Parkman Group taken as a whole;
(ii) that any member of the Wider Parkman Group is subject to
any liability, contingent or otherwise, which is not disclosed in the Parkman
Annual Accounts, and which is material in the context of the Parkman Group; or
(iii) any information which affects the import of any
information disclosed to Mouchel at any time by or on behalf of any member of
the Wider Parkman Group to an extent which is adverse and material in the
context of the Parkman Group taken as a whole;
(k) in relation to any release, emission, accumulation, discharge,
disposal or other fact or circumstance which has caused or might impair the
environment (including property) or harm human health, no past or present member
of the Wider Parkman Group, in a manner or to an extent which is material in the
context of the Offer, (i) having committed any violation of any laws, statutes,
regulations, notices or other requirements of any Third Party and/or (ii) having
incurred any liability (whether actual or contingent) to any Third Party; and/or
(iii) being likely to incur any liability (whether actual or contingent), or be
required, to make good, remediate, repair, re-instate or clean up the
environment (including any property).
Mouchel reserves the right to waive in whole or in part all or any of conditions
(d) to (k) inclusive. Conditions (b) to (k) inclusive must be satisfied as at,
or waived (where possible) on or before, the 21st day after the later of the
first closing date of the Offer and the date on which condition (a) is fulfilled
(or, in each case, such later date as the Panel may agree). Mouchel shall be
under no obligation to waive, to determine to be or treat as fulfilled any of
conditions (b) to (k) inclusive by a date earlier than the date specified above
for the fulfilment thereof notwithstanding that the other conditions of the
Offer may at such earlier date have been waived or fulfilled and that there are
at such earlier date no circumstances indicating that any of such conditions may
not be capable of fulfilment.
If Mouchel is required by the Panel to make an offer for Parkman Shares under
the provisions of Rule 9 of the City Code, Mouchel may make such alterations to
the terms and conditions of the Offer as are necessary to comply with the
provisions of that Rule.
2. Further terms of the Offer
The Offer will lapse if is referred to the Competition Commission before the
later of 3.00 p.m. on the first closing date of the Offer and the date on which
the Offer becomes or is declared unconditional as to acceptances. If the Offer
so lapses, the Offer will cease to be capable of further acceptance and persons
accepting the Offer and Mouchel will cease to be bound by acceptances submitted
on or before the time when the Offer lapses.
The Offer will not be made, directly or indirectly, in or into, or by use of the
mails or by any means or instrumentality (including but not limited to,
facsimile transmission or other electronic transmission, telex or telephone) of
interstate or foreign commerce, or any facilities of a national, state or other
securities exchange, of the United States, nor will it be made, directly or
indirectly in or into Canada, Australia or Japan and will not be capable of
acceptance by any such use, means, instrumentality or facilities or from within
the United States, Canada, Australia or Japan. Accordingly, copies of this
announcement are not being, and must not be mailed or otherwise distributed or
sent in or into or from, the United States, Canada, Australia or Japan.
This announcement is not an offer of securities for sale in the United States
and the New Mouchel Shares have not been, and will not be, registered under the
US Securities Act or under the securities laws of any state, district or other
jurisdiction of the United States, or of Canada, Australia or Japan and no
regulatory clearances in respect of the New Mouchel Shares have been, or will
be, applied for in any jurisdiction other than the UK. Accordingly, unless an
exemption under the US Securities Act or other relevant securities laws is
applicable, the New Mouchel Shares are not being, and may not be, offered, sold,
resold, delivered or distributed, directly or indirectly, in or into the United
States, Canada, Australia or Japan or to, or for the account or benefit of, any
US person or person resident in Canada, Australia or Japan.
APPENDIX II
Financial effects of acceptance of the Offer
The following tables set out, for illustrative purposes only, and on the bases
and assumptions set out in the notes below, the financial effects of acceptance
of the Offer on capital value and gross income for an accepting holder of 100
Parkman Shares if the Offer becomes or is declared unconditional in all
respects:
Decrease in capital value
#
Market value of 123 Mouchel Shares (Note 1) 222.63
Market value of 100 Parkman Shares (Note 2) 236.00
Decrease in capital value 13.37
This represents a decrease of 5.7 per cent.
Increase in gross income
Gross dividend income on 123 Mouchel Shares (Note 3) 2.71
Gross dividend income on 100 Parkman Shares (Note 4) 1.65
Increase in gross income 1.06
This represents an increase of 64.2 per cent.
Notes
1. Based on the closing middle market quotation of 181 pence per Mouchel
Share as derived from the Daily Official List on 20 August 2003, the last
dealing day prior to the date of this announcement.
2. Based on the closing middle market quotation of 236 pence per Parkman
Share as derived from the Daily Official List on 20 August 2003, the last
dealing day prior to the date of this announcement.
3. The gross dividend income on Mouchel Shares is based on the second
interim dividend of 1.45 pence per Mouchel Share announced today in lieu of a
final dividend and the interim dividend of 0.75 pence per share paid on 23 May
2003.
4. The gross dividend income on Parkman Shares is based on the final
dividend of 1.1 pence per Parkman Share paid for the financial year ended 31
March 2003 and the interim dividend of 0.55 pence per share paid on 17 January
2003.
5. No account has been taken of any liability for taxation or the
treatment of fractions of Mouchel Shares in assessing the financial effects of
acceptances of the Offer.
Appendix III
Sources and bases
In this announcement:
1. unless otherwise stated, financial information relating to
Mouchel has been extracted from the audited financial statements of Mouchel for
the relevant financial year or from Mouchel's interim results;
2. unless otherwise stated, financial information relating to
Parkman has been extracted from the audited financial statements of Parkman for
the relevant financial year or from Parkman's interim results and trading update
released on 1 August 2003;
3. the source for the closing middle market quotation of
Mouchel Shares and Parkman Shares is the Daily Official List;
4. the value of the Offer is #78.3 million which is based on
35,171,239 Parkman Shares in issue on 20 August 2003, an exchange ratio of
1.2305 and the middle market quotation of 181 pence per Mouchel Share, as
derived from the Daily Official List at the close of business on 20 August 2003
(being the last dealing day before the date of this announcement);
5. the value of Mouchel's, Parkman's or the Combined Group's
order book on an "advertised value basis" is based on the value of the contracts
entered into by Mouchel, Parkman or the Combined Group, as the case may be, as
advertised by the relevant entity inviting the tender at the time of tender;
6. the value of Mouchel's, Parkman's or the Combined Group's
order book on a "run-rate basis" is based on the advertised value of each
contract together with the expected growth in revenue of the relevant contract
over and above the advertised value;
7. the net turnover of Parkman excludes recharges under certain
service contracts where Parkman is obliged to procure services from third
parties and recharge them to clients at cost including related overheads;
8. the number of New Mouchel Shares to be issued pursuant to
the Offer, being up to 46,063,625 (assuming full acceptance of the Offer, full
exercise of options under the Parkman Share Option Schemes and issuance of
Parkman Shares pursuant to contractual obligations) is based on 35,171,239
Parkman Shares in issue, 2,113,645 Parkman Options outstanding on 20 August 2003
and 150,000 Parkman Shares to be issued pursuant to existing contractual
obligations;
9. the Combined Group's pro forma market capitalisation of
#190.6 million is based on 105,278,210 Mouchel Shares (being the aggregate of
62,000,000 Mouchel Shares in issue as at 20 August 2003 and 43,278,210 New
Mouchel Shares to be issued pursuant to the Offer, save in respect of the
exercise of Parkman Options and any issue of Parkman Shares pursuant to existing
contractual obligations) and the middle market quotation of 181 pence, as
derived from the Daily Official List, for a Mouchel Share on 20 August 2003
(being the last day of dealings prior to the date of this announcement); and
10. the number of Mouchel Shares in respect of which the No 1 ESOP
has undertaken to vote in favour of the resolutions to be proposed to the
Mouchel Extraordinary General Meeting is based on the shares held by the trust
as at 20 August 2003. The number of shares held by the trust may reduce as a
result of any exercise of options under any of the Mouchel Share Schemes.
APPENDIX IV
Definitions
The following definitions apply throughout this press release unless the context
requires otherwise:
"Admission" the admission of the New Mouchel Shares by the UK Listing Authority
to the Official List and to trading on the London Stock Exchange
"Admission and Disclosure Standards" the rules issued by the London Stock Exchange in relation to the
admission to trading of, and continuing requirements for, securities
admitted to the London Stock Exchange
"Authorisations" Authorisations, orders, grants, recognitions, confirmations,
consents, licences, clearances, certificates, permissions and
approvals
"Business Day" a day (excluding Saturdays, Sundays and public holidays) on which
banks are open for business in the City of London
"Cazenove" Cazenove & Co. Ltd
"certificated" or "in certificated in relation to a share or other security, a share or other security
form" title to which it is recorded in the relevant register of the share
or other security as being held in certificated form (that is, not
in CREST)
"City Code" The City Code on Takeovers and Mergers
"Combined Group" the Mouchel Group as enlarged by the Merger
"Companies Act" the Companies Act 1985 (as amended)
"CREST" the relevant system (as defined in the Regulations in respect of
which CRESTCo Limited is the operator)
"Daily Official List" the Daily Official List of the London Stock Exchange
"Directors of the Combined Group" the Mouchel Directors, Richard Archer, Richard Cuthbert, Professor
Sir Michael Lyons and Rodney Westhead
"Form of Acceptance" the form of acceptance and authority for use by Parkman Shareholders
who hold their Parkman Shares in certificated form in connection
with the Offer
"Hoare Govett" Hoare Govett Limited
"Listing Particulars" the listing particulars relating to Mouchel in respect of the New
Mouchel Shares to be issued in connection with the Offer
"Listing Rules" the listing rules made by the UK Listing Authority under section 74
of the Financial Services and Markets Act 2000
"London Stock Exchange" London Stock Exchange plc or its successor
"Managing Agent" Managing agent contracts let by the Highways Agency. The managing
agent is responsible for the management of the maintenance and
improvement of a trunk road network on behalf of the Highways Agency
"Managing Agent Contractor" Managing agent contractor contracts let by the Highways Agency. The
managing agent contractor is responsible for the design, management
and execution of all work on a trunk road network on behalf of the
Highways Agency
"Merger" the proposed merger of Mouchel and Parkman to be effected by means
of the Offer
"Mouchel" or "Company" Mouchel plc
"Mouchel Directors" the directors of Mouchel
"Mouchel Group" or "Group" Mouchel and its subsidiary undertakings and, where the context
permits, each of them
"Mouchel Shareholder(s)" holder(s) of Mouchel Shares
"Mouchel Shares" ordinary shares of 0.25 pence each in Mouchel
"New Mouchel Shares" the Mouchel Shares proposed to be issued credited as fully paid
pursuant to the Offer
"No 1 ESOP" the Mouchel Employee Share Ownership Plan trust established on 19
October 1995
"Mouchel Share Schemes" the Mouchel Sharesave Scheme, the Mouchel International Sharesave
Scheme, the Mouchel Approved Executive Share Option Scheme and the
Mouchel Unapproved Executive Share Option Scheme
"Offer" the recommended offer to be made by Cazenove on behalf of Mouchel to
acquire all the Parkman Shares on the terms and subject to the
conditions set out in the Offer Document and the Form of Acceptance
and, where the context admits, any subsequent revision, variation,
extension or renewal thereof
"Offer Document" the document containing the formal terms and conditions of the Offer
"Official List" the official list maintained by the UK Listing Authority
"PFI" private finance initiative - a form of public private partnership
which involves large amounts of capital expenditure and has a
financing requirement. The risks of financing, constructing and
operating the project are transferred from the UK government to the
private sector
"PFMAC" or "Private Finance Managing private finance managing agent contractor contracts let by the
Agent Contractor" Highways Agency. A proposed extension of the Managing Agent
Contractor contracts let by the Highways Agency, where finance will
be provided by the private sector
"Panel" The Panel on Takeovers and Mergers
"Parkman" Parkman Group plc
"Parkman Annual Accounts" the annual report and accounts of Parkman for the year ended 31
March 2003
"Parkman Directors" the directors of Parkman
"Parkman Group" Parkman and its subsidiary undertakings and, where the context
permits, each of them
"Parkman Options" options over Parkman Shares pursuant to the Parkman Share Option
Schemes
"Parkman Share Option Schemes" the Parkman Group 2001 Approved Share Option Plan, the Parkman Group
2001 Executive Share Option Plan and the Parkman Group 2001
Sharesave Plan
"Parkman Shareholder(s)" holder(s) of Parkman Shares
"Parkman Shares" the existing unconditionally allotted or issued and fully paid
ordinary shares of 1 pence each in the share capital of Parkman and
any further such shares which are unconditionally allotted or issued
prior to the date on which the Offer closes (or such earlier date,
not being earlier than the date on which the Offer becomes
unconditional as to acceptances or, if later, the first closing date
of the Offer, as Mouchel may determine) as a result of the exercise
of Parkman Options or otherwise
"Regulatory Information Service" a regulatory information service of the UK Listing Authority
"Rothschild" N M Rothschild and Sons Limited
"Securities Act" The United States Securities Act of 1933, as amended and the rules
and regulations promulgated thereunder
"subsidiary undertaking" and " shall be construed in accordance with the Companies Act (but for
associated undertaking" this purpose ignoring paragraph 20(i)(b) of Schedule 4A of the
Companies Act
"TfL" Transport for London
"Third Party" a government, governmental, quasi-governmental, supranational,
statutory, regulatory or investigative body, trade agency, court,
professional association, or any other body or person in any
jurisdiction
"UK" the United Kingdom
"UK Listing Authority" the Financial Services Authority acting in its capacity as the
competent authority for the purposes of Part VI of the Financial
Services and Markets Act 2000
"United States" or "US" the United States of America, its possessions and territories and
any area subject to its jurisdiction and any political division
thereof
"Wider Mouchel Group" the Mouchel Group and associated undertakings and any other body
corporate, partnership, joint venture or person in which Mouchel and
such undertakings (aggregating their interests) have an interest of
more than 20 per cent. of the voting or equity capital or the
equivalent
"Wider Parkman Group" the Parkman Group and associated undertakings and any other body
corporate, partnership, joint venture or person in which Parkman and
such undertakings (aggregating their interests) have an interest of
more than 20 per cent. of the voting or equity capital or the
equivalent
All times referred to are London times unless otherwise stated.
This information is provided by RNS
The company news service from the London Stock Exchange
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