Wrap Text
PRESS RELEASE
23 November 2001
JACOBS HOLDINGS PLC
Proposed GBP30 million Subscription by The Bidvest Group Limited
Proposed Tender Offer to Shareholders to acquire up to 37,777,777 Existing
Shares at 22.5p per share
* Jacobs receives GBP30 million investment from Bid
Services
* Jacobs will now be able to unlock its potential
* Bid Services is a wholly owned subsidiary of The
Bidvest Group Limited, South Africa's largest
service company with a market capitalisation of
approximately R14.3 billion (GBP1.0 billion)
* Following the Subscription and the exercise of the
Subscriber's Option, Bid Services will hold 56.7 per
cent of Jacobs' issued share capital
* Tender Offer to Shareholders for up to 37,777,777
Existing Shares at 22.5p per Existing Share
Michael Kingshott, Managing Director of Jacobs, commented:
"We look forward to welcoming Bidvest as a major shareholder in Jacobs.
Their investment will enable us to unlock the full potential of Jacobs'
shipping and automotive businesses. Jacobs will also benefit from Bidvest's
plans to develop its European freight services activities."
Brian Joffe, Chairman of Bidvest, commented:
"We will be delighted to be able to welcome Jacobs into the Bidvest group
and look forward to assisting the Jacobs' directors in developing their
business. Through its relationship with Jacobs, Bidvest will be able to
service its customers' needs with a more comprehensive and efficient
logistics operation, from point of origin to final destination."
For further information, please contact:
Jacobs Holdings Plc: 020 7408 0123
Michael Kingshott, Managing Director
Bidvest:
Brian Joffe, Chairman 020 7493 4733
Jack Hochfeld, Group Corporate Finance
and Investor Relations
David Rosevear, Executive Director
Investec Henderson Crosthwaite: 020 7597 5970
James Grace, Director
Derek Rawlings, Assistant Director
College Hill: 020 7457 2020
Gareth David
Lisa Pearson
Introduction
Further to the announcement released on 15 November 2001, the Board of
Jacobs announces that it has entered into a conditional agreement with The
Bidvest Group Limited and its wholly owned subsidiary, Bid Services, to
raise approximately GBP30 million for the Company before expenses.
Under this agreement, Bid Services will subscribe for, and will be issued,
128,888,878 new Ordinary Shares at 22.5p per share. In addition, Bid
Services has been granted the Subscriber's Option, exercisable under certain
circumstances, over 5,000,000 new Ordinary Shares at 20p per share.
Following Completion and the exercise of the Subscriber's Option, Bid
Services will hold 133,888,878 Ordinary Shares which will represent
approximately 56.7 per cent of the Enlarged Share Capital.
In the light of the proposed change in control of the Company following
Completion, it is intended that Shareholders will be given the opportunity
to tender for sale their shares for cash. The Tender Offer will be limited
in aggregate to a maximum of 37,777,777 Existing Shares (representing
approximately 37.0 per cent. of the Existing Shares).
It is intended that Existing Shares tendered under the Tender Offer will be
placed with institutional and other investors, including certain directors
and employees of Bidvest. Further details of the Tender Offer (which is
conditional on the Subscription proceeding) are set out below.
The Subscription is conditional, inter alia, upon the approval of
Shareholders at the EGM. A circular containing information relating to the
proposed Subscription and the Tender Offer, as well as notice of the
Extraordinary General Meeting will be posted to Shareholders in due course,
together with Listing Particulars relating to Jacobs and the New Shares.
Background to the Proposals
The Company's interim statement for the six months ended 30 June 2001,
released on 1 August 2001, included the following statements:
"Although the Group is again profitable and growth is once more in prospect,
the Board is cognisant of the continuing need to strengthen the Group's
balance sheet, following the heavy losses incurred in 2000 arising from the
discontinued logistics business. Progress has been made with Group
indebtedness reducing to GBP39.5 million from GBP45.0 million as at 31
December 2000.
The Board is examining options available for financing the deferred
consideration of GBP9.0 million due to be paid early next year in respect of
the port facility at Dartford and also the financing of the proposed
development at Shellhaven. The Board is confident that the necessary
funding will be obtained."
Since the release of the Company's interim results, the Board has been faced
with a number of issues, the most material of which are:
(a) the need to make a GBP9.0 million payment to Blue
Circle in February 2002. This is the deferred
consideration for the acquisition of the port at
Dartford referred to above;
(b) the Group is not, at present, sufficiently profitable
overall both to service its current level of debt and
to finance the expansion of its existing businesses;
(c) there is an opportunity to build a new port at
Shellhaven and, subject to obtaining the necessary
planning consents, to realise the considerable
development value of the land at the existing port at
Dartford. However, this will require a larger equity
base notwithstanding the financial advantages of the
proposed joint ventures with P&O;
(d) the Group is presented with a number of expansion
opportunities for its existing businesses (such as
the new service to Dunkerque) which require capital
investment; and
(e) the current economic climate has greatly reduced the
probability that the Group would be able to dispose
of surplus assets within an acceptable time frame and
at acceptable values.
The Board has reviewed a number of options to address the issues set out
above, including:
(i) the sale of surplus assets, or of either the shipping
or the automotive divisions;
(ii) arranging new bank facilities possibly combined with
an equity fund raising; and
(iii) a sale of the Company as a whole.
The sale of surplus assets and/or divisions would be expected to raise
sufficient proceeds to address the Group's indebtedness. However, it
would, in the view of the Directors, result in a Company with greatly
reduced prospects.
While your Board is continuing discussions with its bankers to arrange new
banking facilities, it is by no means certain that it will be able to
arrange new facilities of sufficient size to enable the Group to make the
payment to Blue Circle as well as to meet its ongoing working capital
requirements. Even if new bank facilities are arranged, the Group would
still need to dispose of core businesses in order to reduce bank debt which
will remain too high, or alternatively some form of equity issue will be
required in addition to the new bank facilities. Your Board believes that,
in the absence of the Subscription, such an equity issue would only be
successful at a substantial discount to 19.5p, the closing mid-market share
price on 22 November 2001, the business day prior to the date of this
announcement.
The Board has received a number of approaches in respect of a potential
offer for the Company as a whole. However, none of the approaches offered
sufficient certainty within the limited timeframe available to refinance the
Group.
In October 2001, the Board received an approach from Bidvest which has
resulted in the Proposals set out in this announcement. The Board considers
that, in addition to the subscription of GBP30 million:
Bidvest can provide the Group with additional commercial, financial and
managerial expertise and opportunities to benefit from exposure to Bidvest;
Bid Services is subscribing for New Shares at a substantial premium to the
closing mid-market price of 15.5p per Ordinary Share on 10 October 2001, the
business day prior to the date negotiations first commenced. The Tender
Offer presents an opportunity for Shareholders, if they wish, to sell some
of their Existing Shares at the Subscription Price; and
once the Group is making an acceptable level of return, the Company's share
price should recover and enable Shareholders to realise the underlying value
of their shares. Therefore, while Shareholders' percentage holdings are
being diluted as a result of the Subscription, they still retain an
opportunity to participate in any recovery in the Group's trading.
Following Completion, Jacobs will be focused into three divisions: Freight
Services, Automotive Logistics and Property Outsourcing Services. The
initial intention is to refocus and restructure the businesses, including
cost saving initiatives which may involve disposal of non-core assets,
followed by a strategy of growth and acquisition. Jacobs intends to maintain
the listing of its Ordinary Shares on the Official List.
Following Completion, Jacobs' strategy will be to develop as an
international services business, particularly in freight services. The
Directors and Bidvest believe that the Group will be able to benefit, where
appropriate, from working with Bidfreight, Bidvest's freight business.
Current trading and prospects
The markets within which the Group's automotive and shipping businesses are
engaged remain difficult and highly competitive with continued pressure on
margins. The Group's businesses have remained competitive whilst maintaining
the quality of service required to meet growing customer requirements.
Progress has been made within each of the Group's business units although
the level of business in September of this year was disappointing and this
will impact adversely upon the year as a whole. Some signs of a recovery in
the level of business activity in October should help to alleviate to a
certain extent the adverse effect of events in September.
The overall results to be achieved by the Group for the second half of the
year will be largely dependent on the value received from the sale of
various surplus assets. However, the timing of these transactions is
uncertain and they may fall into the next financial year. In the meantime,
the Group continues to bear the cost of high borrowings and, therefore, debt
reduction remains a priority. Accordingly, it is unlikely that the Directors
will recommend the payment of a final dividend.
In addition, in common with many other quoted companies the introduction of
Financial Reporting Standard 17, the new accounting standard to be applied
to accounting for pension schemes, will require the Company to review the
value of the scheme assets and the related scheme liabilities within the
Group's defined benefit pension schemes. It is expected that a provision,
currently estimated at approximately GBP3.0 million, will have to be made as
at 31 December 2001. The Company is planning to adopt the new accounting
standard early in accordance with best practice.
Summary information on Bidvest
The Bidvest Group Limited is listed on the JSE Securities Exchange South
Africa ("JSE") and currently has a market capitalisation of approximately
R14.3 billion (GBP1.0 billion). By market capitalisation, The Bidvest Group
Limited is one of the largest industrial companies, and the largest service
company, listed on the JSE. Bidvest has achieved a compound EPS growth of
30.5 per cent per annum over the last 10 years, reporting revenues of R29.4
billion (GBP2.2 billion) and earnings of R1.1 billion (GBP80.3 million) in
the year to 30 June 2001.
Bidvest's strategy is to be invested in companies operating in the areas of
service, distribution and trading, which could encompass light
manufacturing. The businesses are managed on a decentralised basis with the
incentivisation of management being one of the key contributing factors to
Bidvest's success.
Bidvest has positioned its three divisions, Services, Food Service Products
and Commercial Products, within their own focused industry sectors to build
further critical mass to succeed not only in South Africa, but also
internationally as stand-alone entities. Bidvest is developing these
divisions as international businesses to generate long term sustainable
growth and shareholder value.
Bidfreight handles more than R100 billion (GBP7 billion) worth of trade
annually, which it believes is a significant proportion of South Africa's
imports and exports. Bidfreight terminals already provide one leg of the
import/export node of the logistics chain in South Africa, and Jacobs could,
with further development, provide other nodes in the United Kingdom and
Europe.
Relationship Agreement
Jacobs and The Bidvest Group Limited have entered into a Relationship
Agreement, conditional on Completion, to ensure that, although Bidvest is a
substantial shareholder of Jacobs, if Jacobs and Bidfreight (or any part of
Bidvest) trade with each other, all transactions will be at arm's length and
on a normal commercial basis, and that Jacobs will be capable of carrying on
its business independently of Bidvest and its associates. Bidvest has
agreed that it will not pursue any opportunity in relation to those
activities carried out by the Group in the markets in which the Group
operates without first offering that opportunity to Jacobs.
Use of proceeds
The net proceeds of the Subscription will, where appropriate, be used to
repay the Group's indebtedness (including the payment to Blue Circle
referred to above) and the balance will be placed on deposit pending
investment.
Terms of the Proposals
The Subscription
Subject, inter alia, to Shareholders' approval, Bid Services has agreed to
subscribe for 128,888,878 new Ordinary Shares at 22.5p per share and to
exercise the option referred to below to subscribe for 5,000,000 new
Ordinary Shares at 20p per share, so as to raise in aggregate approximately
GBP30 million before expenses (approximately GBP28.4 million after
expenses). Conditional on completion of the Subscription, Bid Services will
receive an underwriting commission of GBP600,000, being approximately 2 per
cent. of the value of the funds to be invested in Jacobs.
Subject to the result of the Tender Offer, The Bidvest Group Limited and/or
the Tender Offer Subscribers may also subscribe for Tender Subscription
Shares and Bid Services may subscribe for Further Subscription Shares.
Details are set out below.
As the Subscription would otherwise give rise to an obligation on the
Concert Party to make a general offer for all the Ordinary Shares under Rule
9 of the Code, the Subscription is conditional, inter alia, on independent
Shareholders approving on a poll a waiver of this requirement in general
meeting. For more information about the waiver of the requirement to make a
general offer under Rule 9 of the Code, Shareholders' attention is drawn to
the section below headed "The City Code on Takeovers and Mergers''.
The Subscription is also conditional, inter alia, on the passing of certain
other resolutions at the EGM and on Admission.
The Subscription will be financed by the existing cash reserves of Bidvest.
The Option
On entering into the Subscription Agreement, Bid Services has been granted
the Subscriber's Option, pursuant to which it may subscribe for up to
5,000,000 new Ordinary Shares at an exercise price of 20p per share, such
shares to be allotted following exercise of the Subscriber's Option. The
Subscriber's Option has been granted pursuant to the Directors' existing
authorities granted pursuant to sections 80 and 89 of the Act.
Pursuant to the Subscription Agreement and subject to Completion and
Admission becoming effective, Bid Services has undertaken to exercise the
Subscriber's Option immediately prior to Completion. In the event that the
resolutions are not approved at the EGM and the Subscription does not
proceed to Completion or if the Subscription Agreement is terminated for
force majeure, then the Subscriber's Option will lapse, save where an
announcement has been made prior to the EGM of a potential competing
proposal for Jacobs.
For the purposes of the arrangements between Jacobs and Bidvest referred to
within this announcement, a potential competing proposal means an offer or a
tender offer, scheme of arrangement, recapitalisation or other transaction
for or in respect of some or all of the Ordinary Shares made by a party
other than The Bidvest Group Limited or its subsidiaries and includes,
without limitation, an announcement of such a transaction (whether or not
subject to any pre-conditions) made in accordance with Rules 2.4 or 2.5 of
the City Code. In the event that the Subscriber's Option becomes capable of
exercise, following the announcement of such a competing proposal, it may be
exercised at any time prior to 31 July 2002, at which time it will lapse to
the extent not previously exercised.
Tender Offer
In the light of the change of control of the Company upon Completion, the
Board acknowledges that some Shareholders may not wish to retain some of
their shareholdings in the Company. Accordingly, The Bidvest Group Limited
has agreed, conditionally on Completion, to make a cash offer to purchase or
to procure the purchase of up to 37,777,777 Existing Shares off market, at
the Tender Offer Price, representing approximately 37.0 per cent of the
Existing Shares. Jacobs has agreed, conditional on Completion of the
Subscription, to pay The Bidvest Group Limited an underwriting fee of
GBP85,000, being approximately 1 per cent of the value of the Tender Offer
Shares at the Tender Offer Price. It is not intended that Bidvest will
itself purchase any shares pursuant to the Tender Offer. Accepting
Shareholders will be entitled to receive the Tender Offer Price of 22.5p per
share less an amount equal to 0.5 per cent of such amount, representing
stamp duty payable.
Each Shareholder who validly accepts the Tender Offer will be allocated a
"guaranteed application" of approximately 37.0 per cent of their holding, to
the extent that they wish to tender at least such a percentage of their
holding. Shareholders may apply to sell shares in excess of their
guaranteed application, the "excess application".
In the event that more than 37,777,777 Existing Shares are tendered in
aggregate, each Shareholder's excess application will be scaled back pro
rata. Shareholders' valid applications up to and including their guaranteed
applications of 37.0 per cent into the Tender Offer will be accepted in
full.
It is intended that any Existing Shares validly tendered pursuant to the
Tender Offer will be acquired by, or placed with the placees, comprising
institutional and other investors including certain directors and employees
of Bidvest.
Certain of the Proposed Directors have agreed to acquire or subscribe for
Ordinary Shares under the Tender Offer. Assuming holders of Existing Shares
elect for the maximum number of 37,777,777 Existing Shares, the following
Proposed Directors will acquire the following Ordinary Shares under the
Tender Offer:
Brian Joffe 1,600,000
Rodger Graham 88,889
Lindsay Ralphs 444,444
David Rosevear 320,000
In aggregate, the directors and employees of Bidvest have agreed to
subscribe for 8,195,111 Ordinary Shares, including those Ordinary Shares set
out in the table directly above.
Certain Directors have indicated that they will not accept the Tender Offer
in respect of their aggregate shareholdings. Further details of the
Directors' intentions will be set out in the circular to Shareholders
referred to below. The Tender Offer will not extend to the Subscription
Shares or, to the extent allotted, the Option Shares. If, for any reason,
the Subscription is not completed, the Tender Offer will lapse.
Further details of the Tender Offer, including the procedures for
acceptance, will be set out in a tender offer announcement to be included in
a circular to be sent to Shareholders shortly.
Further Subscription Shares
To the extent that the number of the Ordinary Shares tendered by
Shareholders is less than 18,888,888 Existing Shares, Jacobs will issue to
The Bidvest Group Limited or to the Tender Offer Subscribers, and The
Bidvest Group Limited or the Tender Offer Subscribers will subscribe, at the
Tender Offer Price for the Tender Subscription Shares, being such additional
new Ordinary Shares as will ensure that The Bidvest Group Limited or the
Tender Offer Subscribers receive not less than 18,888,888 Ordinary Shares in
aggregate, whether pursuant to the Tender Offer or otherwise.
In the event that the Company issues Tender Subscription Shares to The
Bidvest Group Limited or the Tender Offer Subscribers under the terms of the
Subscription Agreement, Bid Services will have the right to subscribe for
such number of Further Subscription Shares at the Subscription Price as will
ensure that Bid Services' aggregate holding of shares remains at
approximately 56.7 per cent of the Enlarged Share Capital.
Shareholders should note that although the Tender Offer is conditional on
Completion, the Subscription will proceed (subject to Shareholders' approval
and Admission) whether or not the Tender Offer proceeds.
Board changes
The current Board of Jacobs comprises the following members:
Sir Wilfrid Newton CBE - (Non-Executive Chairman) was a Non-Executive
Director of HSBC Holdings Plc and HSBC Bank Plc. He was previously the
Chairman of London Underground, the Hong Kong Mass Transit Railway, the Hong
Kong Futures Exchange and London Regional Transport. He was appointed
Chairman of Jacobs in 1994.
Michael Kingshott - (Managing Director) was previously Chairman of Sally
Ferries, and also co-founded Sheertruck International Limited and Seaking
Limited, a vehicle pre-delivery inspection specialist. He joined Jacobs as
Managing Director in 1994. On Completion, Michael Kingshott will become
Executive Deputy Chairman.
Stephen Hepplewhite - (Executive Director) has been Managing Director of
Jacobs' Shipping Division since 19 November 1998, and was previously
Managing Director of the speciality business of Hays Group Plc. He was
appointed to the Board of Jacobs on 9 June 2000.
Paul Pascan - (Finance Director) joined Jacobs in 1994 as a Non-Executive
Director and was appointed Finance Director in 1997. Prior to this, he was
Finance Director at Sally Ferries.
David Curtis - (Non-Executive Director) was previously a Director of SG
Hambros Limited. He joined the Board of Jacobs in 1997.
Michael Blackburn - (Non-Executive Director) was previously Chief Executive
of Halifax Plc. He is currently Deputy Chairman of Town Centre Securities
Plc and is also a Non-Executive Director of George Wimpey Plc and DFS
Furniture Company Plc. He was appointed to the Board of Jacobs in May 1999.
Eric Worrall - (Part-time Executive Director) joined the Board of Jacobs in
May 1999 with a customer development and relationship role. He is also a
Director of Messenger Leisure Limited. On Completion, Eric Worrall will
step down as part-time Executive Director and become a Non-Executive
Director.
Sir Wilfred Newton, Michael Blackburn and David Curtis have agreed to step
down from the Board on Completion.
On Completion, it is intended that the following new appointments will be
made to the Board:
Brian Joffe - (Proposed Non-Executive Chairman) is Executive Chairman of The
Bidvest Group Limited and has served as Executive Chairman since he founded
Bid Corporation Limited in 1988. He has thirty years of international
commercial experience.
Ian Spry - (Proposed Executive Director) joined Jacobs in April 1993 and is
currently Managing Director of Sheertruck International, a division of
Jacobs. He has extensive operational and commercial experience within the
vehicle distribution industry and is also responsible for the Group's
vehicle preparation centres.
Mark Stafford - (Proposed Executive Director) is the Managing Director of
Specialist Operations for Ontime Automotive, a division of Jacobs, and is
responsible for the majority of Jacobs' automotive services. Before joining
Jacobs, he worked as commercial manager at Rolls-Royce and Bentley Motor
cars and General Manager Worldwide Sales for Aston Martin.
David Winduss - (Proposed Executive Director) joined Jacobs as Group
Financial Controller and is currently Managing Director of Arcade Traffic
Management Limited. He previously worked in the property departments of
Tarmac plc and Hanson plc, after qualifying as a chartered accountant.
Stephen Bender - (Proposed Non-Executive Director) has sixteen years'
experience as a UK accountant including audit, commercial financial
management, and acquisition investigations. He was appointed to the board
of Bidvest (UK) Limited in June 2000.
Rodger Graham - (Proposed Non-Executive Director) has twenty years'
experience in the textile industry and eleven years in the freight industry.
He is presently Chairman of Bidfreight Terminals and was appointed to the
board of The Bidvest Group Limited in 2000.
Joe Pamensky - (Proposed Non-Executive Director) is the longest serving Non-
Executive Director of The Bidvest Group Limited with over forty years
experience in the financial, insurance and banking industries and is the
recipient of a number of business awards. He serves as a Non-Executive
Director on the boards of numerous public and private companies, both in and
outside South Africa.
Lindsay Ralphs - (Proposed Non-Executive Director) joined The Bidvest Group
Limited as Operations Director in 1992. In 1994 he was appointed Managing
Director of Steiner, a hygiene services business, and Chairman of Bidserv
following the acquisition of Prestige, a cleaning services business.
David Rosevear - (Proposed Non-Executive Director) has twenty five years of
diverse South African and international executive experience. With Bidvest
he was previously Chairman of the food manufacturing division, before
transferring as Chairman of the freight division in 1998. He remains
involved in Bidvest's corporate finance activities. He was appointed to the
board of The Bidvest Group Limited in March 1992.
Messrs Spry, Stafford and Winduss are existing employees of the Group and
their terms of employment will not change. Eric Worrall and the other
Proposed Directors will be appointed as new non-executive directors under
appointment letters and those appointments will be capable of termination at
will by either party. The remuneration payable to Eric Worrall and each
Proposed Director (other than Messrs Spry, Stafford and Winduss, whose
remuneration will remain unchanged) will be GBP18,000 per annum. It is
intended that further non-executive directors of Jacobs will be appointed in
due course.
It is envisaged that at Completion, The Bidvest Group Limited will enter
into a consultancy agreement to provide the services of the Proposed Non-
Executive Directors or other employees of Bidvest as Jacobs and The Bidvest
Group Limited may agree.
Arrangements between Bidvest and Jacobs
Under the terms of the Subscription Agreement, Jacobs has agreed to pay Bid
Services a commitment fee of GBP230,000 in the event that the Subscription
does not proceed to Completion, either as a result of the resolutions not
being approved at the EGM, or as a result of a competing offer, being
announced prior to the EGM or if the Subscription Agreement is terminated as
a result of a breach of covenant or warranty by the Company.
The Bidvest Group Limited has undertaken that, in the event that a de-
listing of Ordinary Shares is procured by The Bidvest Group Limited or Bid
Services or the board of directors of Jacobs at any time whilst Bidvest or
parties acting in concert with it (as defined in the Subscription Agreement)
controls a majority of the votes normally exercisable at general meetings of
the Company, The Bidvest Group Limited will procure that it and its concert
parties will, subject to waiver by way of ordinary resolution of the
Shareholders (Bidvest and any concert parties not voting on any such
resolution), make an offer to acquire all of the remaining issued Ordinary
Shares of the Company, not already owned by Bidvest (or its concert
parties), at a price not less than the mid-market price prevailing of an
Ordinary Share (as derived from the London Stock Exchange Daily Official
List) on the date immediately prior to the first announcement of the
intention to de-list the Ordinary Shares.
The City Code on Takeovers and Mergers
Under Rule 9 of the Code, when any person or group of persons acquires
shares carrying 30 per cent or more of the voting rights of a company, such
a person or group of persons is normally required to extend a general offer
to that company's shareholders to acquire the remaining equity share
capital.
Following Completion, and assuming that the Subscriber's Option is exercised
in full, Bid Services will have acquired 133,888,878 Ordinary Shares
representing approximately 56.7 per cent of the Enlarged Share Capital. This
percentage interest will not change as a result of the Tender Offer, by
virtue of the arrangements for the Further Subscription Shares described
above.
Following Completion, and assuming that the Subscriber's Option is exercised
in full and that the maximum of 37,777,777 Ordinary Shares are tendered
under the Tender Offer, the Concert Party will have acquired 159,861,767
Ordinary Shares representing approximately 67.7 per cent of the Enlarged
Share Capital. It should be noted that, since Old Mutual Securities Limited
is acting as financial adviser to The Bidvest Group Limited in relation to
the Proposals, the Concert Party's holding includes the 17,777,778 Ordinary
Shares to be acquired by Old Mutual Asset Managers (South Africa) (PTY)
Limited. Since The Bidvest Group Limited will be making the Tender Offer,
it is possible, should the maximum number of shares be tendered under the
Tender Offer and each of the placees renege on their commitments to acquire
the Tender Offer Shares, that The Bidvest Group Limited will have to acquire
all of the Tender Offer Shares. Under this, albeit unlikely, scenario, it
is possible that the Concert Party will have acquired 171,666,655 Ordinary
Shares representing approximately 72.7 per cent of the Enlarged Share
Capital. The Panel will be asked to agree, subject to a resolution being
approved by independent Shareholders on a poll at the EGM, to waive any
obligation on the Concert Party to make a general offer for all the Ordinary
Shares under Rule 9 of the Code as a result of the Subscription and the
exercise of the Subscriber's Option.
It should be noted that following the Subscription, Bidvest's shareholding
in the Company will exceed 50 per cent of the voting rights of the Company.
Bidvest, therefore, will be able to increase its shareholding without
incurring any further obligation under Rule 9 of the Code to make a general
offer to the shareholders of the Company so long as its shareholding remains
greater than 50 per cent.
Extraordinary General Meeting
To enable the Subscription to proceed, it is necessary, inter alia, for
Shareholders to waive any requirement under the Code for the Concert Party
to make a general offer, as noted above, to increase the authorised share
capital of the Company and to give the Board the necessary authority to
allot the New Shares. Accordingly, an EGM will be convened for as soon as
possible to consider and, if thought fit, approve the requisite resolutions.
It is not expected that the EGM will be convened later than 2 January 2002.
Application for Admission
The New Shares will, when issued, rank pari passu in all respects with the
Existing Shares including the right to receive all dividends hereafter
declared, made or paid on the issued share capital of the Company.
Applications will be made for the New Shares to be admitted to the Official
List and to trading on the London Stock Exchange's market for listed
securities. Admission is expected to take place and dealings in the New
Shares are expected to commence on 3 January 2002.
Despatch of Circular and Listing Particulars
A circular to Shareholders setting out full details of the Proposals and
convening the EGM, together with Listing Particulars, will be despatched to
Shareholders as soon as practicable. The circular will contain full details
of the expected timetable of events.
Definitions
The following definitions apply throughout this announcement unless the
context otherwise requires:
"Act" the Companies Act 1985 (as
amended)
"Admission" admission of the New Shares to
(i) the Official List and (ii)
trading on the London Stock
Exchange's market for listed
securities.
"Blue Circle" Blue Circle Industries PLC, a
subsidiary of Lafarge SA
"Bidvest" The Bidvest Group Limited and
its subsidiaries.
"Bid Services" Bid Services Division Limited, a
wholly owned subsidiary of
Bidvest
"Code" or "City Code" the City Code on Takeovers and
Mergers
"Completion" completion of the Subscription
"Concert Party" Bidvest, Old Mutual Asset
Managers (South Africa) (PTY)
Limited and certain directors
and employees of Bidvest to be
named in the circular referred
to in this announcement
"Directors" or "Board" the existing directors of Jacobs
"Enlarged Share the share capital of Jacobs as
Capital" enlarged by the issue of the New
Shares
"Existing Shares" the 102,317,460 Ordinary Shares
in issue at the date of this
announcement
"EGM" or "Extraordinary the extraordinary general
General Meeting" meeting of the Company to be
convened as soon as practicable
to approve, inter alia, the
Subscription
"Further Subscription the 24,717,312 new Ordinary
Shares" Shares which may be subscribed
by Bid Services at the
Subscription Price, depending on
the number of Tender
Subscription Shares issued
"Investec" Investec Bank (UK) Limited
"Investec Henderson Investec Henderson Crosthwaite,
Crosthwaite" a division of Investec
"Jacobs" or the Jacobs Holdings plc
"Company"
"Jacobs Group" or Jacobs and its subsidiaries
"Group"
"Listing Particulars" the listing particulars relating
to Jacobs and the New Shares to
be published shortly in
connection with the Subscription
"London Stock Exchange" London Stock Exchange plc
"New Shares" the Subscription Shares, the
Tender Subscription Shares (to
the extent the same are issued
and allotted), the Further
Subscription Shares (to the
extent the same are issued and
allotted) and the Option Shares
(to the extent the Subscriber's
Option is exercised)
"Official List" the Official List of the UKLA
"Option Deed" the deed executed by Jacobs
dated 23 November 2001 pursuant
to which Jacobs has granted to
Bid Services the Subscriber's
Option
"Option Shares" up to 5,000,000 new Ordinary
Shares, the subject of the
Subscriber's Option
"Ordinary Shares" ordinary shares of 20p each in
the capital of Jacobs
"P&O" Peninsular and Oriental Steam
Navigation Company
"Panel" the Panel on Takeovers and
Mergers
"Proposals" together, the Subscription and
the Tender Offer
"Proposed Directors" the new directors proposed to be
appointed to the Board of Jacobs
on Completion
"Qualifying Shareholders on the register of
Shareholders" members on the record date of
the Tender Offer
"Relationship the relationship agreement
Agreement" entered into between Jacobs and
The Bidvest Group Limited dated
23 November 2001
"Relevant Securities" Ordinary Shares and securities
convertible into, or
exchangeable for, rights to
subscribe for, options in
respect of and derivatives
referenced to, any of the
foregoing
"Shareholders" holders of Ordinary Shares
"Subscriber's Option" the options granted to Bid
Services to subscribe for all or
part of the Option Shares at 20p
per Option Share pursuant to the
Option Deed
"Subscription" the proposed subscription for
the Subscription Shares and (if
appropriate) the Further
Subscription Shares
"Subscription the conditional agreement
Agreement" between Jacobs, Bid Services and
The Bidvest Group Limited dated
23 November 2001 relating to the
Subscription
"Subscription Price" 22.5p per Subscription Share and
(to the extent issued) per
Further Subscription Share
"Subscription Shares" the 128,888,878 new Ordinary
Shares proposed to be issued to
Bid Services at the Subscription
Price pursuant to the
Subscription
"Tender Offer" the proposed cash offer to be
made by Investec to purchase or
procure purchasers for up to
37,777,777 Existing Shares at
the Tender Offer Price
"Tender Offer Price" 22.5p (gross) per Existing Share
"Tender Offer Shares" the 37,777,777 Existing Shares
which are the subject of the
Tender Offer
"Tender Offer persons procured by The Bidvest
Subscribers" Group Limited to subscribe
Tender Subscription Shares
"Tender Subscription up to 18,888,888 new Ordinary
Shares" Shares to be issued to The
Bidvest Group Limited or the
Tender Offer Subscribers at the
Subscription Price, depending on
the level of acceptances of the
Tender Offer
"UKLA" or "UK Listing the Financial Services Authority
Authority" Limited in its capacity as the
competent authority for the
purposes of Part IV of the
Financial Services Act 1986
"United Kingdom" or the United Kingdom of Great
"UK" Britain and Northern Ireland
The Directors, whose names are set out above, accept responsibility for the
information contained in this announcement other than as set out in the
paragraph directly below. To the best of the knowledge and belief of the
Directors (who have taken all reasonable care to ensure that such is the
case), the information contained herein is in accordance with the facts and
does not omit anything likely to affect the import of such information.
The executive directors of The Bidvest Group Limited and the directors of
Bid Services, accept responsibility for the information contained in this
announcement relating to Bidvest and the directors of The Bidvest Group
Limited. To the best of the knowledge and belief of the executive directors
of The Bidvest Group Limited and the directors of Bid Services (who have
taken all reasonable care to ensure that such is the case), the information
contained herein for which they are responsible is in accordance with the
facts and does not omit anything likely to affect the import of such
information.
Investec Henderson Crosthwaite, a division of Investec Bank (UK) Limited
which is regulated in the UK by The Securities and Futures Authority
Limited, is acting for Jacobs in connection with the Proposals and is not
acting for any person other than Jacobs and will not be responsible to
anyone other than Jacobs for providing the protections accorded to customers
of Investec Henderson Crosthwaite or for providing advice in connection to
the Proposals.
Old Mutual Securities Limited which is regulated in the UK by The Securities
and Futures Authority Limited, is acting for The Bidvest Group Limited and
Bid Services in connection with the Proposals and is not acting for any
person other than The Bidvest Group Limited and Bid Services and will not be
responsible to anyone other than The Bidvest Group Limited for providing the
protections accorded to customers of Old Mutual Securities Limited or for
providing advice in connection with the Proposals.
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