RNS Number:4908H
Mallett PLC
14 February 2003

Mallett PLC ("Mallett")

14 February 2003

Response to Tender Offer


Mallett PLC has today written to shareholders with regard to the tender offer
announced to the London Stock Exchange on 6 February 2003 by Trefick Limited.

The following is the main written text of the letter sent to shareholders:

"Tender Offer by Trefick Limited ("Trefick")

On 6 February 2003, Trefick announced an unsolicited and unwelcome Tender Offer
to acquire up to 7.4 per cent. of the issued share capital of Mallett. This
Tender Offer is an opportunistic attempt to take advantage of uncertain current
stock market conditions in order to acquire your shares at a price which
undervalues Mallett shares and does not allow you to receive the final dividend
for the year ended 31 December 2002.

I am writing to advise you that your Board, which has been advised by Close
Brothers, unanimously recommends that you do not accept the Tender Offer.

The Tender Offer

You recently have received a document from Trefick which seeks to acquire your
shares at a price of 225 pence.

This document was posted following an announcement to the London Stock Exchange
on 6 February 2003 that Trefick had made a Tender Offer to acquire up to
1,015,610 ordinary shares in Mallett, representing 7.4 per cent. of its issued
share capital, at 225 pence per share. As at 6 February 2003, Trefick owned
3,110,607 ordinary shares, representing 22.5 per cent of the issued share
capital of the Company. Should the Tender Offer be successful, Trefick would own
29.9 per cent. of the issued share capital of the Company.

Trefick

The intentions of Trefick in relation to Mallett are not clear and, so far as
the Board is aware, Trefick has no previous experience of the market for high
quality antiques.

Under the Tender Offer, Trefick is seeking to acquire the maximum number of
shares it can obtain without being obliged by the City Code to launch a takeover
offer for the whole of the Company's share capital. The Tender Offer document
states that "Trefick has no intention of making a general (takeover) offer for a
controlling stake in Mallett PLC". This is inconsistent with impressions gained
by members of the Board. Shareholders should note that, pursuant to the City
Code, Trefick's statement in its document will prevent such a takeover offer
from being made only for a period of up to six months.

Trefick gives no reason for you to tender your shares in its Tender Offer
document. It is clear that Trefick appreciates the true value of Mallett's
shares - you should not sell your shares in Mallett to Trefick on the cheap.



Why you should ignore the Tender Offer

In recommending that you ignore the Tender Offer by Trefick, the Directors have
taken into account the factors set out below:


Mallett's strong market position and trading record


Mallett has a strong market position and an excellent reputation and track
record as one of the world's leading international dealers in high quality
antique furniture, glass and works of art.


These qualities are reflected in the strong trading record of the Company, which
expects to report on 18 February 2003 its preliminary results for the year ended
31 December 2002. These are expected to show a profit on ordinary activities
before taxation of not less than #5.0 million (2001: #4.328 million) and
earnings per share of not less than 25 pence (2001: 21.46 pence) - an increase
of at least 16.5 per cent.


These results illustrate the strong sales and trading skills of the management
team at Mallett and have been achieved against the background of a challenging
trading environment and in contrast to results reported by other antique
dealers.


In line with these strong results, the Board expects to declare a final dividend
of 6.8 pence per share, making a total dividend for the year of 9.2 pence - an
increase of 12.1 per cent. from the previous year. Shareholders should note that
they will not receive the final dividend of 6.8 pence if they accept the Tender
Offer.


Mallett's prospects


The planned opening of a new shop on Madison Avenue in New York is a significant
development for the Company and is expected to take place on schedule in April
2003. The New York shop will improve the Company's ability to serve its
substantial and growing number of American clients.


The strong results for 2002 were achieved in a challenging trading environment
and were aided by a small number of very substantial transactions. Despite the
uncertain and volatile outlook and the increase in the Company's cost base, the
Board is confident in the continuing global market for the finest antiques.


Net asset position


Mallett has strong asset backing, with net assets per share increasing every
year since its flotation in 1987.


The Company has an outstanding stock of antiques for resale and has valuable
property interests through its ownership of a long lease at Bourdon House, 2
Davies Street, London, the leasehold of 141 New Bond Street, London and the
leasehold at 929 Madison Avenue, New York. Your Board believes that Mallett's
assets are worth considerably in excess of their book value. As at 30 June 2002,
the Company had net book assets of #27.6 million representing 200 pence per
share and at 31 December 2002 will have net book assets in excess of this
figure.


The small premium offered by the Trefick Tender Offer


The Tender Offer of 225p represents a premium of only 5.4 per cent. over the
average mid-market price of a Mallett ordinary share over the six month period
immediately prior to the announcement of the Tender Offer.


Mallett's authority to repurchase shares


Shareholders are reminded that the Board has authority to repurchase up to 10
per cent. of its share capital in the market. It is intended that the Board will
seek to renew this authority at the forthcoming annual general meeting currently
scheduled for May 2003.


Following the announcement of preliminary results, which is expected to take
place on 18 February 2003, your Board will consider using its existing authority
to repurchase shares in the market, subject to prevailing market conditions and
the availability and price of Mallett shares. The Company's existing authority
permits it to purchase up to 10 per cent. of its issued share capital at a
premium of up to 5 per cent. above the average middle market quotation of a
Mallett share at the close of business on the five business days immediately
preceding the date of any purchase.


Recommendation


The Directors will not be accepting the Tender Offer in respect of any of their
holdings and have also received indications in writing from other shareholders
that they will not be accepting the Tender Offer. The total of these shares
represents 60.8 per cent. of Mallett's issued share capital not already owned by
Trefick.


Your Board, which has been advised by Close Brothers, unanimously recommends
that shareholders do not accept the Tender Offer. In providing advice to the
Board, Close Brothers has relied on the commercial assessments of the Board."


Enquiries:

Mallett PLC      Peter Dixon      020 7499 7411


Close Brothers      Mark Wrightson      020 7655 3100

Christopher Lewey




Close Brothers Corporate Finance Limited, which is regulated in the United
Kingdom for the conduct of investment business by the Financial Services
Authority, is acting exclusively for Mallett PLC in connection with the matters
described herein and no-one else and will not be responsible to anyone other
than Mallett PLC for providing the protections afforded to customers of Close
Brothers Corporate Finance Limited, nor for providing advice in relation to the
matters described herein nor on any other matter.


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            The company news service from the London Stock Exchange
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