TIDMCFGP
RNS Number : 0962B
United Farmers Holding Company
28 March 2013
NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION (IN WHOLE OR IN
PART) DIRECTLY OR INDIRECTLY IN, INTO OR FROM ANY JURISDICTION
WHERE TO DO SO WOULD CONSTITUTE A VIOLATION OF THE RELEVANT LAWS OF
SUCH JURISDICTION
For immediate release
28 March 2013
RECOMMENDED CASH OFFER
For
CONTINENTAL FARMERS GROUP PLC
By
UNITED FARMERS HOLDING COMPANY
to be effected by means of a scheme of arrangement under section
157 of the Isle of Man Companies Act 2006
Summary
-- The boards of United Farmers Holding Company (UFHC) and
Continental Farmers Group plc (CFG) are pleased to announce that
they have reached agreement on the terms of a recommended cash
offer pursuant to which UFHC will acquire all of the issued and to
be issued share capital of CFG. The Offer is to be effected by
means of a scheme of arrangement under section 157 of the Isle of
Man Companies Act 2006.
-- UFHC was incorporated under the laws of the Kingdom of Saudi
Arabia on 24 March 2013. UFHC is wholly-owned by Saudi Agricultural
and Livestock Investment Co., Saudi Grains and Fodder Holding LLC
and Almarai Company (the Consortium).
-- Under the terms of the Offer, if the Scheme becomes
effective, CFG Shareholders will receive 35 pence in cash for each
CFG Share and up to a further 2 pence in cash for each CFG Share by
way of Deferred Consideration (the Basic Offer) unless they elect
to receive 36 pence in cash for each CFG Share (the Cash
Alternative).
-- The Basic Offer excluding the Deferred Consideration values
the entire issued share capital of CFG on a fully diluted basis
(assuming awards vest in respect of 2,777,500 CFG Shares under the
2011 LTIP) at approximately GBP58.2 million. The Basic Offer
including the full amount of the Deferred Consideration values the
entire issued share capital of CFG on a fully diluted basis
(assuming awards vest in respect of 2,777,500 CFG Shares under the
2011 LTIP) at approximately GBP61.5 million. The Cash Alternative
values the entire issued share capital of CFG on a fully diluted
basis (assuming awards vest in respect of 2,777,500 CFG Shares
under the 2011 LTIP) at approximately GBP59.9 million.
-- The Cash Alternative represents a premium of 50.0 per cent.
to the Closing Price of 24.0 pence for each CFG Share on 27 March
2013, being the last Business Day before the date of this
announcement.
-- There is no certainty that any Deferred Consideration will
become payable under the Basic Offer. If the Scheme becomes
effective, CFG Shareholders who do not elect to receive the Cash
Alternative will be deemed to accept the Basic Offer and may only
receive 35 pence in cash for each CFG Share.
-- UFHC has received irrevocable undertakings and a letter of
intent to vote (or procure the voting) in favour of the Scheme in
relation to, in aggregate, 117,296,523 CFG Shares, representing
approximately 71.7 per cent. of the issued share capital of CFG on
27 March 2013 (being the last Business Day before the date of this
announcement). In addition to undertaking to vote in favour of the
Scheme, CFG Shareholders (including the CFG Directors), who hold,
are beneficially entitled to or control 68,528,454 CFG Shares,
representing approximately 41.9 per cent. of the issued share
capital of CFG on 27 March 2013 (being the last Business Day before
the date of this announcement), have irrevocably undertaken to
accept the Basic Offer.
-- The CFG Directors, who have been so advised by Deloitte,
consider the terms of the Offer to be fair and reasonable. In
providing advice to the CFG Directors, Deloitte has taken into
account the commercial assessments of the CFG Directors.
-- Accordingly, the CFG Directors intend to recommend
unanimously that CFG Shareholders vote in favour of the Scheme at
the Court Meeting, as the CFG Directors who beneficially own or
control, and can procure the voting of, CFG Shares have irrevocably
undertaken to do so in respect of their controlled holdings of, in
aggregate, 15,940,201 CFG Shares, representing approximately 9.8
per cent. of the issued share capital of CFG on 27 March 2013
(being the last Business Day before the date of this
announcement).
-- The Offer will require the approval of CFG Shareholders and
the sanction of the Court. The Offer will also be conditional on,
among other things, approval of the acquisition of CFG by UFHC
being received from the Antimonopoly Committee of Ukraine in a form
reasonably satisfactory to UFHC. The Scheme Document containing
further information about the Offer and notice of the Court Meeting
will be posted to CFG Shareholders as soon as practicable and, in
any event, within 28 days of the date of this announcement. It is
expected that the Scheme will become effective during June 2013,
subject to the satisfaction or waiver of the Conditions and to
certain further terms set out in Appendix 1 to this
announcement.
-- The long stop date by which the Scheme must become effective
(unless extended with the agreement of the parties to the Offer) is
30 September 2013. The Scheme will also lapse (unless the parties
to the Offer agree otherwise) if the Court Meeting does not take
place on or before the twenty second day after the expected date of
the Court Meeting to be set out in the Scheme Document. The Scheme
will also lapse (unless the parties to the Offer agree otherwise)
if the Scheme petition is not heard before the Court on or before
the twenty second day after the expected date of the Scheme
petition hearing to be set out in the Scheme Document.
-- Commenting on the Offer, Dr Khalid Al Malahy, director of UFHC, said:
"The investment strategy of UFHC is to make long-term
investments in the agricultural sector, with the principal
objective of developing sustainable sources of food, grain and
fodder on a global scale. UFHC firmly believes that it is
well-positioned to support the proposed growth of CFG, both
financially and through the experience of the consortium members in
the international agricultural markets."
-- Commenting on the Offer, Nicholas Parker, Chairman of CFG, said:
"The board of Continental Farmers Group plc is pleased to
recommend unanimously this offer from UFHC. The offer represents an
attractive premium to the current and historic share price of CFG
for shareholders. For the company, it brings access to substantial
capital and to the expertise of the members of the consortium in
the international agribusiness sector. The offer recognises that
the CFG business is highly scalable and represents an excellent
opportunity for CFG to accelerate the development of its
operations.
It is only 20 months since we listed and new investors joined to
support CFG's strategy for growth. In that period, under Mark
Laird's leadership, CFG has developed an outstanding farming
platform, which is reflected in the offer that we have received.
The CFG directors would like to thank the executive team and all
our people who have worked, and will continue to work, to make CFG
so successful. We would also thank our investors for their
commitment and trust. I would like personally to thank the board of
CFG for its constant support over many years."
This summary should be read in conjunction with, and is subject
to, the full text of this announcement (including its Appendices).
The Scheme will be subject to the Conditions and certain further
terms set out in Appendix 1 to this announcement and to the full
terms and conditions to be set out in the Scheme Document. Appendix
2 to this announcement contains details of the irrevocable
undertakings and a letter of intent received by UFHC in connection
with the Offer. Appendix 3 contains the sources and bases of
certain information contained in this summary and in the full text
of this announcement. Appendix 4 contains the definitions of
certain terms used in this summary and in the full text of this
announcement.
Enquiries
Maitland (PR adviser to UFHC) +44 (0)20 7379 5151
Neil Bennett
Brian Hudspith
Ernst & Young LLP (Financial adviser
to UFHC) +44 (0)20 7951 2000
Tim Medak
Mark Harrison
CFG +44 (0)7917 017818
Mark Laird (Chief Executive)
Dickson Minto (Financial adviser
to CFG) +44(0) 207 628 4455
Douglas Armstrong
Deloitte Corporate Finance (Rule
3 adviser to CFG) +44 (0)20 7936 3000
James Lewis
Gavin Hood
Craig Lukins
Davy (Nomad and ESM adviser to
CFG) +353 1 679 6363
John Frain
Anthony Farrell
Murray Consulting (PR adviser to
CFG) +353 876 909 735
Joe Heron
Further information
This announcement is for information purposes only and is not
intended to and does not constitute, or form part of, any offer,
invitation or the solicitation of an offer to purchase, otherwise
acquire, subscribe for, sell or otherwise dispose of any
securities, or the solicitation of any vote or approval in any
jurisdiction, pursuant to the Offer or otherwise.
The Offer will be made solely by means of the Scheme Document,
which will contain the full terms and conditions of the Offer,
including details of how to vote in respect of the Scheme. Any vote
in respect of the Scheme or other response in relation to the Offer
should be made only on the basis of the information contained in
the Scheme Document. CFG Shareholders are advised to read the
formal documentation in relation to the Offer carefully once it has
been despatched.
The statements contained in this announcement are made as at the
date of this announcement, unless some other time is specified in
relation to them.
Ernst & Young LLP, which is authorised and regulated in the
UK by the Financial Services Authority, is acting for UFHC and no
one else in connection with the Offer and will not regard any other
person (whether or not a recipient of this announcement) as a
client in relation to the Offer and will not be responsible to
anyone other than UFHC for providing the protections afforded to
its clients or for providing advice in relation to the Offer or any
matters referred to in this announcement.
Dickson Minto W.S., which is authorised and regulated in the
United Kingdom by the Financial Services Authority, is acting
exclusively for CFG and no one else in connection with the Offer
and will not be responsible to any person other than CFG for
providing the protections afforded to clients of Dickson Minto W.S.
or for providing advice in relation to the Offer, the contents of
this announcement or any matters referred to in this
announcement.
Deloitte Corporate Finance is acting for CFG and no one else in
connection with the Offer and will not be responsible to anyone
other than CFG for providing the protections afforded to clients of
Deloitte Corporate Finance or for providing advice in relation to
the Offer, the contents of this announcement or any matters
referred to in this announcement. Deloitte Corporate Finance is a
division of Deloitte LLP, which is authorised and regulated in the
United Kingdom by the Financial Services Authority in respect of
regulated activities. Deloitte Corporate Finance has given and not
withdrawn its written consent to the issue of this announcement
with the inclusion herein of the references to its name in the form
and context in which it appears.
Davy, which is authorised and regulated in Ireland by the
Central Bank of Ireland, is acting as nominated adviser and ESM
adviser to CFG under the AIM Rules and the ESM Rules respectively
and no one else in connection with the Offer and will not be
responsible to anyone other than CFG for providing the protections
afforded to clients of Davy or for providing advice in relation to
the Offer, the contents of this announcement or any other matters
referred to in this announcement.
Overseas jurisdictions
The availability of the Offer to CFG Shareholders who are not
resident in and citizens of the UK or the Isle of Man may be
affected by the laws of the relevant jurisdictions in which they
are located or of which they are citizens. Persons who are not
resident in the UK or the Isle of Man should inform themselves of,
and observe, any applicable legal or regulatory requirements of
their jurisdictions. Further details in relation to overseas
shareholders will be contained in the Scheme Document.
The release, publication or distribution of this announcement in
or into jurisdictions other than the UK or the Isle of Man may be
restricted by law and therefore any persons who are subject to the
laws of any jurisdiction other than the UK or the Isle of Man
should inform themselves about, and observe, any applicable
requirements. Any failure to comply with the applicable
restrictions may constitute a violation of the securities laws of
any such jurisdiction. To the fullest extent permitted by
applicable law, the companies and persons involved in the Offer
disclaim any responsibility or liability for violation of such
restrictions by any person.
This announcement has been prepared for the purposes of
complying with Isle of Man law, English law, the AIM Rules for
Companies, the ESM Rules for Companies and the Code and the
information disclosed may not be the same as that which would have
been disclosed if this announcement had been prepared in accordance
with the laws of jurisdictions outside the Isle of Man and
England.
The Offer will not be made, directly or indirectly, in, into or
from any jurisdiction where to do so would violate the laws in that
jurisdiction. Accordingly, copies of this announcement and formal
documentation relating to the Offer will not be, and must not be,
mailed or otherwise forwarded, distributed or sent in, into or from
any jurisdiction where to do so would violate the laws of that
jurisdiction.
The Offer relates to shares of a company incorporated in the
Isle of Man and is proposed to be effected by means of a scheme of
arrangement under the laws of the Isle of Man. The scheme of
arrangement will relate to the shares of a company incorporated in
the Isle of Man that is a "foreign private issuer" as defined under
Rule 3b-4 under the US Securities Exchange Act of 1934, as amended
(the Exchange Act). A transaction effected by means of a scheme of
arrangement is not subject to proxy solicitation or tender offer
rules under the Exchange Act. Accordingly, the Offer is subject to
the disclosure requirements, rules and practices applicable in the
Isle of Man to schemes of arrangement, which differ from the
requirements of US proxy solicitation and tender offer rules.
Financial information included in the relevant documentation will
have been prepared in accordance with accounting standards
applicable to an Isle of Man company traded on AIM and ESM that may
not be comparable to the financial statements of companies
incorporated in the United States or companies whose financial
statements are prepared in accordance with generally accepted
accounting principles in the US. If UFHC exercises its right to
implement the acquisition of the CFG Shares by way of a Contractual
Offer, such offer will be made in compliance with applicable US
tender offer and securities laws and regulations, to the extent
applicable.
Forward-looking statements
This announcement contains statements which are, or may be
deemed to be, "forward-looking statements" which are prospective in
nature. All statements other than statements of historical fact may
be forward-looking statements. They are based on current
expectations and projections about future events, and are therefore
subject to risks and uncertainties which could cause actual results
to differ materially from the future results expressed or implied
by the forward-looking statements. Often, but not always,
forward-looking statements can be identified by the use of
forward-looking words such as "plans", "expects", "is expected",
"is subject to", "budget", "scheduled", "estimates", "forecasts",
"intends", "anticipates", "believes", "targets", "aims", "projects"
or words or terms of similar substance or the negative thereof, as
well as variations of such words and phrases or statements that
certain actions, events or results "may", "could", "should",
"would", "might" or "will" be taken, occur or be achieved. Such
statements are qualified in their entirety by the inherent risks
and uncertainties surrounding future expectations.
Such forward-looking statements involve risks and uncertainties
that could significantly affect expected results and are based on
certain key assumptions. Many factors could cause actual results to
differ materially from those projected or implied in any
forward-looking statements. Due to such uncertainties and risks,
readers are cautioned not to place undue reliance on such
forward-looking statements, which speak only as of the date of this
announcement. UFHC, each Consortium Group Member and each member of
the CFG Group, and their respective members, directors, officers,
employees, advisers and any person acting on their behalf,
expressly disclaim any intention or obligation to update or revise
any forward-looking or other statements contained in this
announcement, whether as a result of new information, future events
or otherwise, except as required by applicable law.
None of UFHC, the Consortium Group Members or any member of the
CFG Group or their respective members, directors, officers or
employees, advisers or any person acting on their behalf, provides
any representation, assurance or guarantee that the occurrence of
the events expressed or implied in any forward-looking statements
in this announcement will actually occur.
Except as expressly provided in this announcement, no
forward-looking or other statements have been reviewed by the
auditors of UFHC, any Consortium Group Member or CFG. All
subsequent oral or written forward-looking statements attributable
to UFHC, any Consortium Group Member or any member of the CFG Group
or any of their respective members, directors, officers, advisers
or employees or any person acting on their behalf are expressly
qualified in their entirety by the cautionary statement above.
No profit forecasts or estimates
Nothing contained in this announcement shall be deemed to be a
forecast, projection or estimate of the future financial
performance of CFG or the CFG Group, UFHC or any Consortium Group
Member, except where otherwise stated.
Disclosure requirements of the Code
Under Rule 8.3(a) of the Code, any person who is interested in
1% or more of any class of relevant securities of an offeree
company or of any paper offeror (being any offeror other than an
offeror in respect of which it has been announced that its offer
is, or is likely to be, solely in cash) must make an Opening
Position Disclosure following the commencement of the offer period
and, if later, following the announcement in which any paper
offeror is first identified. An Opening Position Disclosure must
contain details of the person's interests and short positions in,
and rights to subscribe for, any relevant securities of each of (i)
the offeree company and (ii) any paper offeror(s). An Opening
Position Disclosure by a person to whom Rule 8.3(a) applies must be
made by no later than 3.30 pm (London time) on the 10th business
day following the commencement of the offer period and, if
appropriate, by no later than 3.30 pm (London time) on the 10th
business day following the announcement in which any paper offeror
is first identified. Relevant persons who deal in the relevant
securities of the offeree company or of a paper offeror before the
deadline for making an Opening Position Disclosure must instead
make a Dealing Disclosure.
Under Rule 8.3(b) of the Code, any person who is, or becomes,
interested in 1% or more of any class of relevant securities of the
offeree company or of any paper offeror must make a Dealing
Disclosure if the person deals in any relevant securities of the
offeree company or of any paper offeror. A Dealing Disclosure must
contain details of the dealing concerned and of the person's
interests and short positions in, and rights to subscribe for, any
relevant securities of each of (i) the offeree company and (ii) any
paper offeror, save to the extent that these details have
previously been disclosed under Rule 8. A Dealing Disclosure by a
person to whom Rule 8.3(b) applies must be made by no later than
3.30 pm (London time) on the business day following the date of the
relevant dealing.
If two or more persons act together pursuant to an agreement or
understanding, whether formal or informal, to acquire or control an
interest in relevant securities of an offeree company or a paper
offeror, they will be deemed to be a single person for the purpose
of Rule 8.3.
Opening Position Disclosures must also be made by the offeree
company and by any offeror and Dealing Disclosures must also be
made by the offeree company, by any offeror and by any persons
acting in concert with any of them (see Rules 8.1, 8.2 and
8.4).
Details of the offeree and offeror companies in respect of whose
relevant securities Opening Position Disclosures and Dealing
Disclosures must be made can be found in the Disclosure Table on
the Takeover Panel's website at www.thetakeoverpanel.org.uk,
including details of the number of relevant securities in issue,
when the offer period commenced and when any offeror was first
identified. You should contact the Panel's Market Surveillance Unit
on +44 (0)20 7638 0129 if you are in any doubt as to whether you
are required to make an Opening Position Disclosure or a Dealing
Disclosure.
Rule 2.10 disclosure
In accordance with Rule 2.10, CFG confirms that it has
163,488,703 CFG Shares in issue and admitted to trading on AIM and
ESM as at the date of this announcement. The International
Securities Identification Number for CFG Shares is
IM00B50X9K63.
Information relating to CFG Shareholders
Please be aware that addresses, electronic addresses and certain
other information provided by CFG Shareholders, persons with
information rights and other relevant persons for the receipt of
communications from CFG may be provided to UFHC during the offer
period as requested under Section 4 of Appendix 4 to the Code, in
order to comply with Rule 2.12(c) of the Code.
Publication on website
A copy of this announcement will be made available on CFG's
website at www.continentalfarmersgroup.com by no later than 12 noon
(London time) on the Business Day following the date of this
announcement. For the avoidance of doubt, the contents of that
website are not incorporated into, and do not form part of, this
announcement.
Any person to whom this announcement is sent may request a hard
copy of this announcement (and any information incorporated by
reference in this announcement) by contacting Appleby Trust (Isle
of Man) Limited (the CFG registered agent) during business hours on
+44 (0)1624 647647 or by submitting a request in writing to Appleby
Trust (Isle of Man) Limited at 33-37 Athol Street, Douglas IM1 1LB,
Isle of Man. It is important to note that unless such a request is
made, a hard copy of this announcement and any such information
incorporated by reference in it will not be sent to any such
person. Any person to whom this announcement is sent may also
request that all future documents, announcements and information
sent to that person in relation to the Offer be in hard copy
form.
NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION (IN WHOLE OR IN
PART) DIRECTLY OR INDIRECTLY IN, INTO OR FROM ANY JURISDICTION
WHERE TO DO SO WOULD CONSTITUTE A VIOLATION OF THE RELEVANT LAWS OF
SUCH JURISDICTION
28 March 2013
RECOMMENDED CASH OFFER
For
CONTINENTAL FARMERS GROUP PLC
By
UNITED FARMERS HOLDING COMPANY
to be effected by means of a scheme of arrangement under section
157 of the Isle of Man Companies Act 2006
1. Introduction
The boards of UFHC and CFG are pleased to announce that they
have reached agreement on the terms of a recommended cash offer
pursuant to which UFHC will acquire the entire issued and to be
issued share capital of CFG. The Offer is to be effected by means
of a scheme of arrangement under section 157 of the Isle of Man
Companies Act 2006.
2. The Offer
(a) The Basic Offer
Under the Basic Offer, if the Scheme becomes effective, CFG
Shareholders will receive:
for each CFG Share 35 pence in cash and up to a further 2 pence
in cash
by way of Deferred Consideration
The Basic Offer excluding the Deferred Consideration values the
entire issued share capital of CFG on a fully diluted basis
(assuming awards vest in respect of 2,777,500 CFG Shares under the
2011 LTIP) at approximately GBP58.2 million. The Basic Offer
including the full amount of the Deferred Consideration values the
entire issued share capital of CFG on a fully diluted basis
(assuming awards vest in respect of 2,777,500 CFG Shares under the
2011 LTIP) at approximately GBP61.5 million.
There is no certainty that any Deferred Consideration will
become payable under the Basic Offer. If the Scheme becomes
effective, CFG Shareholders who do not elect to receive the Cash
Alternative will be deemed to accept the Basic Offer and may only
receive 35 pence in cash for each CFG Share.
(b) The Cash Alternative
Under the Cash Alternative, if the Scheme becomes effective, CFG
Shareholders will receive:
for each CFG Share 36 pence in cash
The Cash Alternative values the entire issued share capital of
CFG on a fully diluted basis (assuming awards vest in respect of
2,777,500 CFG Shares under the 2011 LTIP) at approximately GBP59.9
million.
The Cash Alternative represents a premium of 50.0 per cent. to
the Closing Price of 24.0 pence for each CFG Share on 27 March
2013, being the last Business Day before the date of this
announcement.
In order to accept the Cash Alternative, in addition to voting
in favour of the Scheme at the Court Meeting (either in person or
by proxy), a CFG Shareholder must make an election to accept the
Cash Alternative by completing the Form of Election in accordance
with the instructions to be set out in the Scheme Document.
Otherwise, if the Scheme becomes effective, any CFG Shareholder who
has not made such an election will be deemed to have accepted the
Basic Offer.
(c) The Deferred Consideration
Under the Basic Offer, each CFG Shareholder shall be entitled to
receive:
(i) 35 pence in cash for each CFG Share; and
(ii) Deferred Consideration of up to a further 2 pence in cash for each CFG Share.
The Deferred Consideration represents a basic contractual right
to receive further consideration under the Basic Offer upon the
registration of up to 7,000 ha of unregistered leasehold land
which, as at 20 March 2013, formed part of the CFG Group's land
bank in the Ukraine (the Relevant Land).
Leasehold land is legally registered, and title to leasehold
land is legally effective, in the Ukraine in the event of issuance
of a registration extract from the Ukraine State Real Property
Rights Register (the Ukraine Register) to the leaseholder. Due to
the upgrading of IT systems, it has not been possible to register
leasehold land on the Ukraine Register on a normal basis in recent
months.
As at 20 March 2013, the CFG Group held leases in respect of
approximately 33,000 ha of land in the Ukraine, of which
approximately 9,900 ha was held pursuant to unregistered leasehold
arrangements with individual lessors (the Existing Unregistered
Leases).
The amount of Deferred Consideration payable under the Basic
Offer will depend on the amount of Relevant Land which is legally
registered on the Ukraine Register during the period commencing on
1 May 2013 and ending on 31 October 2014 (the Registration Period).
The maximum amount of Deferred Consideration of 2 pence for each
CFG Share will be payable if at least 7,000 ha of Relevant Land is
registered during the Registration Period.
There is no certainty that the full amount of Deferred
Consideration will be paid to CFG Shareholders who accept the Basic
Offer and, if no Relevant Land is registered on the Ukraine
Register during the Registration Period, no Deferred Consideration
will be payable. In these circumstances, a CFG Shareholder who
accepts the Basic Offer would receive 35 pence in cash for each CFG
Share.
The successful legal registration of Relevant Land will be
assessed quarterly during the Registration Period. Deferred
Consideration will be payable at quarterly intervals depending on
the amount of Relevant Land which has been legally registered
during the preceding quarter. Deferred Consideration will only be
payable at the end of a quarter if at least 1,750 ha of Relevant
Land has been legally registered during that quarter (or during any
previous quarters in respect of which no Deferred Consideration has
become payable because insufficient Relevant Land has been
registered (a Nil Consideration Quarter)). Subject to this
quarterly threshold of 1,750 ha (representing 0.5 pence of Deferred
Consideration for each CFG Share), the Deferred Consideration will
be payable on a straight-line basis in relation to Relevant Land
which is legally registered on the Ukraine Register during the
Registration Period. In respect of the final quarter of the
Registration Period, Deferred Consideration will be payable in
respect of the amount of Relevant Land which has been legally
registered on the Ukraine Register during that quarter (or during
any previous Nil Consideration Quarter), even if less than 1,750 ha
of Relevant Land has been registered, in aggregate, during the
Registration Period.
The formula for calculating the Deferred Consideration payable
under the Basic Offer is:
= Total amount (in ha) of x 2 pence
Relevant Land registered
on the Ukraine Register
during the Registration
Period (up to a maximum
of 7,000 ha)
--------------------------
Aggregate Deferred
Consideration under
the Basic Offer 7,000
The payment date for any Deferred Consideration which falls due
shall be 14 days after the end of the relevant quarter period
following the start of the Registration Period. Any Deferred
Consideration shall be paid to all CFG Shareholders who accept the
Basic Offer. If any payment date falls on a date prior to the
Effective Date, the relevant payment or payments of Deferred
Consideration shall be made to CFG Shareholders who accept the
Basic Offer 14 days after the Effective Date.
By way of example, if 50 ha of Relevant Land have been legally
registered on the Ukraine Register in the quarter period beginning
on 1 May 2013 and ending on 31 July 2013, no Deferred Consideration
will be payable on or before the first quarterly payment date of 14
August 2013. If a further 1,960 ha of Relevant Land have been
registered on the Ukraine Register in the second quarter period
ending on 31 October 2013 so that, in aggregate, 2,010 ha of
Relevant Land have been registered in the Registration Period up to
that date, Deferred Consideration of (2,010 ÷ 7,000) x 2 pence for
each CFG Share will be payable in cash on or before 14 November
2013 to each CFG Shareholder who accepts the Basic Offer. If a
further 3,290 ha of Relevant Land have then been legally registered
on the Ukraine Register in the third quarter period ending on 31
January 2014 so that, in aggregate, 5,300 ha of Relevant Land have
been legally registered in the Registration Period up to that date,
further Deferred Consideration of (3,290 ÷ 7,000) x 2 pence for
each CFG Share will be payable in cash on or before 14 February
2014 to each CFG Shareholder who accepts the Basic Offer. If in the
period between 1 February 2014 and 31 October 2014 (i.e. the end of
the Registration Period), a further 1,000 ha of Relevant Land have
then been legally registered on the Ukraine Register so that, in
aggregate, 6,300 ha of Relevant Land have been legally registered
in the Registration Period up to that date, Deferred Consideration
of (1,000 ÷ 7,000) x 2 pence for each CFG Share will be payable in
cash on or before 14 November 2014 to each CFG Shareholder who
accepts the Basic Offer.
This example is also described in the table below:
Quarter Total amount Total amount Deferred Consideration Cumulative Deferred Consideration
of Relevant of Relevant payable in respect payable in respect of
Land registered Land registered of each CFG each CFG Share during
during relevant during Registration Share for relevant Registration Period
quarter (ha) Period (ha) quarter
-------- ----------------- --------------------- ----------------------- ----------------------------------
1 50 50 0 0
-------- ----------------- --------------------- ----------------------- ----------------------------------
2,010/7,000
2 1,960 2,010 x 2 pence 2,010/7,000 x 2 pence
-------- ----------------- --------------------- ----------------------- ----------------------------------
3,290/7,000
3 3,290 5,300 x 2 pence 5,300/7,000 x 2 pence
-------- ----------------- --------------------- ----------------------- ----------------------------------
4 400 5,700 0 5,300/7,000 x 2 pence
-------- ----------------- --------------------- ----------------------- ----------------------------------
5 100 5,800 0 5,300/7,000 x 2 pence
-------- ----------------- --------------------- ----------------------- ----------------------------------
1,000/7,000
6 500 6,300 x 2 pence 6,300/7,000 x 2 pence
-------- ----------------- --------------------- ----------------------- ----------------------------------
As demonstrated in the table above, if in any relevant quarter
the amount of Relevant Land which has been legally registered on
the Ukraine Register does not exceed 1,750 ha, the amount of
Relevant Land legally registered during that quarter would be
carried forward and added to the amount of Relevant Land legally
registered during the next quarter for the purposes of calculating
any Deferred Consideration which might become payable.
The boards of UFHC and CFG will each nominate a representative
to oversee the registration process for Relevant Land and the
payment of any Deferred Consideration under the Basic Offer.
Further details of the Deferred Consideration mechanism will be
included in the Scheme Document.
3. Background to and reasons for the Offer
CFG fits well with UFHC's investment strategy. CFG has a high
quality land portfolio in the Ukraine and Poland, well-suited for
the growth of arable crops, to which CFG management has applied
advanced farming techniques to continually improve crop yields.
CFG's management team includes experienced farming professionals
with western European training and local language skills. The
management team has established good working relationships with
local, municipal and state authorities and customers in the Ukraine
and Poland which, when combined with the Consortium Members'
international expertise, will help develop additional opportunities
for CFG in the future.
CFG's business model is highly scalable and, in combination with
the highly fragmented nature of land ownership in Poland and
Ukraine, provides an opportunity to expand further its high quality
land bank and diversify the crops it grows. UFHC intends to work
alongside CFG's existing management team to deliver this growth,
including management's objective of increasing CFG's cropping area
in the Ukraine to 50,000 ha by 2015.
4. Recommendation
The CFG Directors, who have been so advised by Deloitte,
consider the terms of the Offer to be fair and reasonable. In
providing advice to the CFG Directors, Deloitte has taken into
account the commercial assessments of the CFG Directors.
Accordingly, the CFG Directors intend to recommend unanimously
that CFG Shareholders vote in favour of the Scheme at the Court
Meeting, as the CFG Directors who beneficially own or control, and
can procure the voting of, CFG Shares have irrevocably undertaken
to do in respect of their controlled holdings of, in aggregate,
15,940,201 CFG Shares, representing approximately 9.8 per cent. of
the issued share capital of CFG on 27 March 2013 (being the last
Business Day before the date of this announcement).
5. Background to and reasons for the recommendation
The CFG Directors have evaluated the Offer by UFHC on behalf of
CFG Shareholders as a whole. In deciding to recommend the Offer to
CFG Shareholders, the CFG Directors have taken into account a
number of factors, including those outlined below.
CFG has been farming in Poland since 1994 and the Ukraine since
2006. At an early stage in the business's development CFG
identified the potential of acquiring holdings of high quality land
and applying best practice in modern farming methods to produce a
superior yield with excellent margins. The Company has adopted a
proactive strategy of land acquisition and infrastructure
development. In the last four years, area under production has
increased to 26,122 ha and the Company has also made substantial
investments in machinery, buildings and the human capital needed to
grow the business. CFG has indicated that its target is to have
50,000 ha of land under planting by 2015. The Company has indicated
that it is on track to plant over 32,000 ha in the Ukraine and
3,300 ha in Poland in 2013, including land operated by CFG in joint
ventures with ED&F Man and RaboFarm. The growth that has been
achieved so far has required significant investment. In 2008 and
early 2009 the CFG Group raised EUR20 million of equity funding to
accelerate its expansion in the Ukraine. These funds were used to
advance the land lease programme, purchase modern machinery,
chemicals and fertiliser as well as investment in storage
facilities and for working capital purposes. The CFG IPO in 2011
raised a further EUR16.7 million. These funds have been used to
build a business of considerable scale. The Offer will provide CFG
with the access to capital necessary to allow it to expand upon the
strategy set out at the time of the IPO.
The Consortium Members bring substantial capital, expertise and
the benefits of access to their long track record in the
international agribusiness sector. UFHC will enable CFG to achieve
its goals and accelerate the development of its operations in a way
not available to CFG in its current form.
The CFG Directors consider that the Offer recognises this
potential and therefore presents an opportunity for CFG
Shareholders to realise an attractive cash price for their CFG
Shares. The Cash Alternative provides an attractive premium of 55.6
per cent. to the IPO price (23.1 pence for each CFG Share) when CFG
was admitted to trading on AIM in 2011.
6. Irrevocable undertakings and a letter of intent
In aggregate, UFHC has received irrevocable undertakings and a
letter of intent to vote in favour of the Scheme in relation to
117,296,523 CFG Shares, representing approximately 71.7 per cent.
of the share capital of CFG in issue on 27 March 2013 (being the
last Business Day before the date of this announcement), as
follows:
(a) CFG Shareholders (including the CFG Directors) who hold, are
beneficially entitled to or can control 111,553,797 CFG Shares in
aggregate, representing approximately 68.2 per cent. of the share
capital of CFG in issue on 27 March 2013 (being the last Business
Day before the date of this announcement) have executed irrevocable
undertakings to vote in favour of the Scheme; and
(b) a CFG Shareholder which is able to control 5,742,726 CFG
Shares, representing approximately 3.5 per cent. of the share
capital of CFG in issue on 27 March 2013 (being the last Business
Day before the date of this announcement) has also stated, on a
non-binding basis, that it intends to vote in favour of the
Scheme.
UFHC has received irrevocable undertakings from those of the CFG
Directors who hold or are beneficially entitled to CFG Shares to
vote in favour of the Scheme in respect of 15,940,201 CFG Shares,
representing approximately 9.8 per cent. of CFG's share capital in
issue on 27 March 2013 (being the last Business Day before the date
of this announcement).
Further details of these irrevocable undertakings and the letter
of intent (including the circumstances in which certain of them may
lapse) are set out in Appendix 2 to this announcement.
7. Information relating to CFG
CFG is a diversified agricultural producer whose principal
activity is the cultivation and distribution of arable crops. CFG's
principal farming operations are in the Lviv Oblast region, Western
Ukraine and the Vistula Delta region, Northern Poland. CFG's core
business is the production of oil seed rape, potatoes, wheat, sugar
beet and maize. CFG's crops are sold when harvested or stored in
CFG's storage facilities for later sale to the Ukrainian domestic
market, Russia and the European Union. CFG had approximately 26,100
ha under crop for the 2012 harvest (excluding hectares harvested
under joint ventures). The CFG Group employs approximately 170
permanent employees and up to 200 seasonal employees.
CFG Shares are traded on the Alternative Investment Market of
the London Stock Exchange (AIM: CFGP) and the Enterprise Securities
Market of the Irish Stock Exchange (ESM: CT3).
8. Current trading and prospects of CFG
On 28 March 2013, CFG announced its full year results for the 12
months ended 31 December 2012 which showed revenues of EUR31
million (2011: EUR25 million), EBITDA of EUR7.3 million (2011:
EUR6.7 million) and profit before tax of EUR1.9 million (2011:
EUR3.1 million).
During 2012 cropped area increased in line with the CFG's
strategic plan with a 42 per cent. rise to 26,122 ha.
CFG has already planted approximately 19,600 ha of winter
cereals for 2013 harvest, ahead of its growth strategy set out at
the time of listing. With good conditions at the time of planting
in Autumn 2012 and widespread snow cover throughout the winter,
CFG's crops in Poland and Western Ukraine are currently in
excellent health. CFG remains committed to its agronomy-led
approach to farming based on a strategy of precision planting and
expects this to continue delivering through improved yields and
better margins.
9. Information relating to the Consortium
(a) SALIC was established by the Public Investment Fund of the
Kingdom of Saudi Arabia for the purposes of making international
investments in the agribusiness sector. SALIC is a substantial
company with a paid-up share capital of SAR 3 billion (GBP530
million) and has seven board members, employing seven people on its
management team. PIF, which is wholly-owned by the Government of
Saudi Arabia, was established in 1971 for the purpose of providing
financial support to commercial projects which are strategically
significant for the development of the Saudi Arabian economy. PIF
holds significant interests in a wide range of companies,
principally in the financial, agricultural, transportation,
industrial and real estate sectors.
(b) SGAF is 95 per cent. owned by Sheikh Sulaiman Al Rajhi and
is part of the Al Rajhi group in the Kingdom of Saudi Arabia. SGAF
makes diversified investments in agriculture and
agriculture-related sectors on a global scale. SGAF is currently a
very significant importer of grain and fodder into Saudi Arabia. In
recent years, SGAF has forged strategic alliances and joint
ventures with agribusiness partners in the Ukraine.
(c) Almarai is a public company listed on Tadawul (the Saudi
Stock Exchange). Almarai is a major integrated consumer food group
in the Middle East operating in a range of sectors including dairy,
fruit juices, bakery, poultry and infant formula. Almarai has a
strong market presence in Saudi Arabia and the neighbouring Gulf
Co-operation Council countries. Almarai is the largest integrated
dairy company in the world, with a market capitalisation of
approximately SAR 26.6 billion (GBP4.6 billion) and turnover in
2012 of SAR 9.9 billion (GBP1.75 billion). As part of its vertical
integration strategy, it also owns and operates arable farms in
Argentina. Almarai is a well-recognised brand that was ranked
number 4 in Forbes's list of 'Top-40 Arab Brands' and identified by
both Credit Suisse and the FT as "a brand for tomorrow". Almarai
employs 26,000 people.
10. Information relating to UFHC
UFHC was incorporated under the laws of the Kingdom of Saudi
Arabia on 24 March 2013. UFHC is owned as to 34 per cent. by SALIC,
33 per cent. by SGAF and 33 per cent. by Almarai.
11. Management and employees
UFHC attaches great importance to the skills and experience of
the current management and employees of CFG, and confirms that
their existing employment rights (including pension rights) will be
fully safeguarded.
UFHC is focused on retaining the expertise of the existing CFG
management team following completion of the Offer.
12. CFG long-term incentive plan
The Scheme will extend to any CFG Shares which are
unconditionally allotted or issued and fully paid (or credited as
fully paid) before the record date of the Scheme, including CFG
Shares issued pursuant to awards under the 2011 LTIP. Participants
in the 2011 LTIP will be contacted regarding the effect of the
Scheme on their rights under the 2011 LTIP, and appropriate
proposals will be made to such participants in due course in
respect of those rights under the 2011 LTIP that have already
vested or will vest as a consequence of the Scheme becoming
effective.
It is currently proposed that a new cash-based incentive
arrangement will be implemented for key personnel under which the
potential reward will be linked to the achievement of appropriate
performance targets.
13. Financing
The cash consideration payable by UFHC to CFG Shareholders under
the Offer will be financed by the existing cash resources of the
Consortium.
Ernst & Young LLP, as financial adviser to UFHC, is
satisfied that sufficient resources are available to UFHC to
satisfy, in full, the cash consideration payable to CFG
Shareholders under the terms of both the Basic Offer and the Cash
Alternative.
14. Structure of the Offer
It is intended that the Offer will be implemented by way of a
Court-sanctioned scheme of arrangement, between CFG and the CFG
Shareholders, under section 157 of the Isle of Man Companies Act
2006.
The purpose of the Scheme is to provide for UFHC to become the
holder of the entire issued and to be issued share capital of CFG.
To become effective, the Scheme will require approval by a majority
in number of CFG Shareholders who are present and voting (either in
person or by proxy) at the Court Meeting, representing at least 75
per cent. in value of the CFG Shares voted.
The Scheme will also be subject to the Conditions and further
terms set out in Appendix 1 to this announcement and the more
detailed terms to be set out in the Scheme Document and the Form of
Election. These Conditions provide that the Offer will lapse if the
Scheme does not become effective by 5.00 p.m. on the Long Stop
Date. The Scheme will also lapse (unless the parties to the Offer
agree otherwise) if the Court Meeting does not take place on or
before the twenty second day after the expected date of the Court
Meeting to be set out in the Scheme Document. The Scheme will also
lapse (unless the parties to the Offer agree otherwise) if the
Scheme petition is not heard before the Court on or before the
twenty second day after the expected date of the Scheme petition
hearing to be set out in the Scheme Document.
Once the necessary approval from CFG Shareholders has been
obtained, the Scheme must be sanctioned by the Court. After the
Scheme has been sanctioned by the Court, the Court Order will
become effective provided that a certified copy of the Court Order,
together with a copy of the Scheme and any accompanying documents,
is delivered to the Isle of Man Companies Registry within seven
days of the date of the Court Order.
Once the Court Order becomes effective, the Scheme will be
binding on all CFG Shareholders, irrespective of whether or not
they attended or voted at the Court Meeting (and if they attended
and voted, whether or not they voted in favour). However, the
Scheme will not become effective until all other Conditions have
been satisfied or (where applicable) waived. Subject to
satisfaction or (where applicable) waiver of the other Conditions,
the Scheme is expected to become effective during June 2013. On the
Effective Date, share certificates in respect of CFG Shares will
cease to be valid and entitlements to CFG Shares held within the
CREST system will be cancelled.
CFG Shares will be acquired by UFHC pursuant to the Scheme fully
paid and free from all liens, charges, equities, encumbrances,
rights of pre-emption and any other interests of any nature
whatsoever and together with all rights attaching thereto,
including voting rights and the rights to receive and retain in
full all dividends and other distributions declared, made or paid
on or after the Effective Date.
UFHC reserves the right, subject to the consent of the Panel, to
elect to implement the Offer by way of a Contractual Offer. Subject
to the receipt of such consent, in such event the Offer would be
implemented on substantially the same terms, subject to appropriate
amendments (including, without limitation, an acceptance condition
set at 90 per cent. (or such lesser percentage, being more than 50
per cent., as UFHC may decide) of the CFG Shares to which the
Contractual Offer relates and of the voting rights carried by those
CFG Shares).
The Scheme Document will include full details of the Scheme,
together with the notice of the Court Meeting. The Scheme Document
will also contain the expected timetable for the Offer and will
specify the necessary actions to be taken by CFG Shareholders. The
Scheme Document, together with the Form of Proxy and the Form of
Election, will be posted to CFG Shareholders and, for information
only, to persons with information rights and to holders of awards
granted under the CFG 2011 LTIP as soon as practicable and, in any
event, within 28 days of the date of this announcement. It is
expected that the Court Meeting (subject to the approval of the
Court) will be held in late May 2013.
15. Offer-related arrangement
The Consortium Members and CFG entered into a confidentiality
agreement on 22 January 2013 pursuant to which each Consortium
Member has undertaken to keep confidential information relating to
CFG and not to disclose it to third parties (other than to
permitted recipients) unless required by law or regulation. This
confidentiality agreement includes a six month standstill period
restricting certain dealings in CFG Shares by the Consortium
Members, and non-solicitation undertakings by the Consortium
Members in respect of senior CFG employees.
16. De-listing
Prior to the Court Meeting, CFG intends to notify AIM and ESM
that it wishes to cancel the admission of its shares to trading,
with effect as of or shortly following the Effective Date. AIM and
ESM require a minimum of twenty Business Days' advance notice of
the preferred cancellation date.
Cancellation will be effected by dealing notices to be
disseminated by AIM and ESM through the Regulatory News Service
operated by the London Stock Exchange. On the Effective Date, CFG
will become a wholly-owned subsidiary of UFHC and share
certificates in respect of CFG Shares will cease to be valid and
entitlements to CFG Shares held within the CREST system will be
cancelled.
17. Disclosure of interests in relevant securities
As at the close of business on 27 March 2013, being the last
Business Day before the date of this announcement, save for the
irrevocable undertakings and the letter of intent referred to in
paragraph 6 above, UFHC, the Consortium Members, their respective
directors and, so far as UFHC is aware, persons acting, or deemed
to be acting, in concert with UFHC:
(a) had no interest in, or right to subscribe for, relevant securities of CFG;
(b) had no short position (whether conditional or absolute and
whether in the money or otherwise), including any short position
under a derivative, any agreement to sell or any delivery
obligation or right to require another person to purchase or take
delivery of, relevant securities of CFG;
(c) had not procured an irrevocable commitment or letter of
intent to accept or vote in favour of the Offer in respect of
relevant securities of CFG; or
(d) had not borrowed or lent any CFG Shares.
Furthermore, no arrangement exists with UFHC or any person
acting in concert with UFHC in relation to the CFG Shares. For
these purposes, "arrangement" includes any indemnity or option
arrangement, any agreement or any understanding, formal or
informal, of whatever nature, relating to CFG Shares, which may be
an inducement to deal or refrain from dealing in such
securities.
18. Documents on display
Copies of the following documents will be published by no later
than 12 noon (London time) on the Business Day following the date
of this announcement on CFG's website at
www.continentalfarmersgroup.com:
(a) the irrevocable undertakings and letter of intent referred
to in paragraph 6 above and summarised in Appendix 2 to this
announcement;
(b) the confidentiality agreement referred to in paragraph 15 above; and
(c) this announcement.
19. General
The Offer will be subject to the Conditions and certain further
terms set out in Appendix 1 to this announcement and to the more
detailed terms to be set out in the Scheme Document when
published.
The Scheme will be governed by the law of the Isle of Man and
will be subject to the jurisdiction of the courts of the Isle of
Man. The Scheme will be subject to the applicable requirements of
the Code, the London Stock Exchange, the Irish Stock Exchange and
is conditional, among other things, on approval by the AMC in a
form reasonably satisfactory to UFHC.
Certain terms used in this announcement are defined in Appendix
4.
Enquiries
Maitland (PR adviser to UFHC) +44 (0)20 7379 5151
Neil Bennett
Brian Hudspith
Ernst & Young LLP (Financial adviser
to UFHC) +44 (0)20 7951 2000
Tim Medak
Mark Harrison
CFG +44 (0)7917 017818
Mark Laird (Chief Executive)
Dickson Minto (Financial adviser
to CFG) +44(0) 207 628 4455
Douglas Armstrong
Deloitte Corporate Finance (Rule
3 adviser to CFG) +44 (0)20 7936 3000
James Lewis
Gavin Hood
Craig Lukins
Davy (Nomad and ESM adviser to
CFG) +353 1 679 6363
John Frain
Anthony Farrell
Murray Consulting (PR adviser to
CFG) +353 876 909 735
Joe Heron
Further information
This announcement is for information purposes only and is not
intended to and does not constitute, or form part of, any offer,
invitation or the solicitation of an offer to purchase, otherwise
acquire, subscribe for, sell or otherwise dispose of any
securities, or the solicitation of any vote or approval in any
jurisdiction, pursuant to the Offer or otherwise.
The Offer will be made solely by means of the Scheme Document,
which will contain the full terms and conditions of the Offer,
including details of how to vote in respect of the Scheme. Any vote
in respect of the Scheme or other response in relation to the Offer
should be made only on the basis of the information contained in
the Scheme Document. CFG Shareholders are advised to read the
formal documentation in relation to the Offer carefully once it has
been despatched.
The statements contained in this announcement are made as at the
date of this announcement, unless some other time is specified in
relation to them.
Ernst & Young LLP, which is authorised and regulated in the
UK by the Financial Services Authority, is acting for UFHC and no
one else in connection with the Offer and will not regard any other
person (whether or not a recipient of this announcement) as a
client in relation to the Offer and will not be responsible to
anyone other than UFHC for providing the protections afforded to
its clients or for providing advice in relation to the Offer or any
matters referred to in this announcement.
Dickson Minto W.S., which is authorised and regulated in the
United Kingdom by the Financial Services Authority, is acting
exclusively for CFG and no one else in connection with the Offer
and will not be responsible to any person other than CFG for
providing the protections afforded to clients of Dickson Minto W.S.
or for providing advice in relation to the Offer, the contents of
this announcement or any matters referred to in this
announcement.
Deloitte Corporate Finance is acting for CFG and no one else in
connection with the Offer and will not be responsible to anyone
other than CFG for providing the protections afforded to clients of
Deloitte Corporate Finance or for providing advice in relation to
the Offer, the contents of this announcement or any matters
referred to in this announcement. Deloitte Corporate Finance is a
division of Deloitte LLP, which is authorised and regulated in the
United Kingdom by the Financial Services Authority in respect of
regulated activities. Deloitte Corporate Finance has given and not
withdrawn its written consent to the issue of this announcement
with the inclusion herein of the references to its name in the form
and context in which it appears.
Davy, which is authorised and regulated in Ireland by the
Central Bank of Ireland, is acting as nominated adviser and ESM
adviser to CFG under the AIM Rules and the ESM Rules respectively
and no one else in connection with the Offer and will not be
responsible to anyone other than CFG for providing the protections
afforded to clients of Davy or for providing advice in relation to
the Offer, the contents of this announcement or any other matters
referred to in this announcement.
Overseas jurisdictions
The availability of the Offer to CFG Shareholders who are not
resident in and citizens of the UK or the Isle of Man may be
affected by the laws of the relevant jurisdictions in which they
are located or of which they are citizens. Persons who are not
resident in the UK or the Isle of Man should inform themselves of,
and observe, any applicable legal or regulatory requirements of
their jurisdictions. Further details in relation to overseas
shareholders will be contained in the Scheme Document.
The release, publication or distribution of this announcement in
or into jurisdictions other than the UK or the Isle of Man may be
restricted by law and therefore any persons who are subject to the
laws of any jurisdiction other than the UK or the Isle of Man
should inform themselves about, and observe, any applicable
requirements. Any failure to comply with the applicable
restrictions may constitute a violation of the securities laws of
any such jurisdiction. To the fullest extent permitted by
applicable law, the companies and persons involved in the Offer
disclaim any responsibility or liability for violation of such
restrictions by any person.
This announcement has been prepared for the purposes of
complying with Isle of Man law, English law, the AIM Rules for
Companies, the ESM Rules for Companies and the Code and the
information disclosed may not be the same as that which would have
been disclosed if this announcement had been prepared in accordance
with the laws of jurisdictions outside the Isle of Man and
England.
The Offer will not be made, directly or indirectly, in, into or
from any jurisdiction where to do so would violate the laws in that
jurisdiction. Accordingly, copies of this announcement and formal
documentation relating to the Offer will not be, and must not be,
mailed or otherwise forwarded, distributed or sent in, into or from
any jurisdiction where to do so would violate the laws of that
jurisdiction.
The Offer relates to shares of a company incorporated in the
Isle of Man and is proposed to be effected by means of a scheme of
arrangement under the laws of the Isle of Man. The scheme of
arrangement will relate to the shares of a company incorporated in
the Isle of Man that is a "foreign private issuer" as defined under
Rule 3b-4 under the US Securities Exchange Act of 1934, as amended
(the Exchange Act). A transaction effected by means of a scheme of
arrangement is not subject to proxy solicitation or tender offer
rules under the Exchange Act. Accordingly, the Offer is subject to
the disclosure requirements, rules and practices applicable in the
Isle of Man to schemes of arrangement, which differ from the
requirements of US proxy solicitation and tender offer rules.
Financial information included in the relevant documentation will
have been prepared in accordance with accounting standards
applicable to an Isle of Man company traded on AIM and ESM that may
not be comparable to the financial statements of companies
incorporated in the United States or companies whose financial
statements are prepared in accordance with generally accepted
accounting principles in the US. If UFHC exercises its right to
implement the acquisition of the CFG Shares by way of a Contractual
Offer, such offer will be made in compliance with applicable US
tender offer and securities laws and regulations, to the extent
applicable.
Forward-looking statements
This announcement contains statements which are, or may be
deemed to be, "forward-looking statements" which are prospective in
nature. All statements other than statements of historical fact may
be forward-looking statements. They are based on current
expectations and projections about future events, and are therefore
subject to risks and uncertainties which could cause actual results
to differ materially from the future results expressed or implied
by the forward-looking statements. Often, but not always,
forward-looking statements can be identified by the use of
forward-looking words such as "plans", "expects", "is expected",
"is subject to", "budget", "scheduled", "estimates", "forecasts",
"intends", "anticipates", "believes", "targets", "aims", "projects"
or words or terms of similar substance or the negative thereof, as
well as variations of such words and phrases or statements that
certain actions, events or results "may", "could", "should",
"would", "might" or "will" be taken, occur or be achieved. Such
statements are qualified in their entirety by the inherent risks
and uncertainties surrounding future expectations.
Such forward-looking statements involve risks and uncertainties
that could significantly affect expected results and are based on
certain key assumptions. Many factors could cause actual results to
differ materially from those projected or implied in any
forward-looking statements. Due to such uncertainties and risks,
readers are cautioned not to place undue reliance on such
forward-looking statements, which speak only as of the date of this
announcement. UFHC, each Consortium Group Member and each member of
the CFG Group, and their respective members, directors, officers,
employees, advisers and any person acting on their behalf,
expressly disclaim any intention or obligation to update or revise
any forward-looking or other statements contained in this
announcement, whether as a result of new information, future events
or otherwise, except as required by applicable law.
None of UFHC, the Consortium Group Members or any member of the
CFG Group or their respective members, directors, officers or
employees, advisers or any person acting on their behalf, provides
any representation, assurance or guarantee that the occurrence of
the events expressed or implied in any forward-looking statements
in this announcement will actually occur.
Except as expressly provided in this announcement, no
forward-looking or other statements have been reviewed by the
auditors of UFHC, any Consortium Group Member or CFG. All
subsequent oral or written forward-looking statements attributable
to UFHC, any Consortium Group Member or any member of the CFG Group
or any of their respective members, directors, officers, advisers
or employees or any person acting on their behalf are expressly
qualified in their entirety by the cautionary statement above.
No profit forecasts or estimates
Nothing contained in this announcement shall be deemed to be a
forecast, projection or estimate of the future financial
performance of CFG or the CFG Group, UFHC or any Consortium Group
Member, except where otherwise stated.
Disclosure requirements of the Code
Under Rule 8.3(a) of the Code, any person who is interested in
1% or more of any class of relevant securities of an offeree
company or of any paper offeror (being any offeror other than an
offeror in respect of which it has been announced that its offer
is, or is likely to be, solely in cash) must make an Opening
Position Disclosure following the commencement of the offer period
and, if later, following the announcement in which any paper
offeror is first identified. An Opening Position Disclosure must
contain details of the person's interests and short positions in,
and rights to subscribe for, any relevant securities of each of (i)
the offeree company and (ii) any paper offeror(s). An Opening
Position Disclosure by a person to whom Rule 8.3(a) applies must be
made by no later than 3.30 pm (London time) on the 10th business
day following the commencement of the offer period and, if
appropriate, by no later than 3.30 pm (London time) on the 10th
business day following the announcement in which any paper offeror
is first identified. Relevant persons who deal in the relevant
securities of the offeree company or of a paper offeror before the
deadline for making an Opening Position Disclosure must instead
make a Dealing Disclosure.
Under Rule 8.3(b) of the Code, any person who is, or becomes,
interested in 1% or more of any class of relevant securities of the
offeree company or of any paper offeror must make a Dealing
Disclosure if the person deals in any relevant securities of the
offeree company or of any paper offeror. A Dealing Disclosure must
contain details of the dealing concerned and of the person's
interests and short positions in, and rights to subscribe for, any
relevant securities of each of (i) the offeree company and (ii) any
paper offeror, save to the extent that these details have
previously been disclosed under Rule 8. A Dealing Disclosure by a
person to whom Rule 8.3(b) applies must be made by no later than
3.30 pm (London time) on the business day following the date of the
relevant dealing.
If two or more persons act together pursuant to an agreement or
understanding, whether formal or informal, to acquire or control an
interest in relevant securities of an offeree company or a paper
offeror, they will be deemed to be a single person for the purpose
of Rule 8.3.
Opening Position Disclosures must also be made by the offeree
company and by any offeror and Dealing Disclosures must also be
made by the offeree company, by any offeror and by any persons
acting in concert with any of them (see Rules 8.1, 8.2 and
8.4).
Details of the offeree and offeror companies in respect of whose
relevant securities Opening Position Disclosures and Dealing
Disclosures must be made can be found in the Disclosure Table on
the Takeover Panel's website at www.thetakeoverpanel.org.uk,
including details of the number of relevant securities in issue,
when the offer period commenced and when any offeror was first
identified. You should contact the Panel's Market Surveillance Unit
on +44 (0)20 7638 0129 if you are in any doubt as to whether you
are required to make an Opening Position Disclosure or a Dealing
Disclosure.
Rule 2.10 disclosure
In accordance with Rule 2.10, CFG confirms that it has
163,488,703 CFG Shares in issue and admitted to trading on AIM and
ESM as at the date of this announcement. The International
Securities Identification Number for CFG Shares is
IM00B50X9K63.
Information relating to CFG Shareholders
Please be aware that addresses, electronic addresses and certain
other information provided by CFG Shareholders, persons with
information rights and other relevant persons for the receipt of
communications from CFG may be provided to UFHC during the offer
period as requested under Section 4 of Appendix 4 to the Code, in
order to comply with Rule 2.12(c) of the Code.
Publication on website
A copy of this announcement will be made available on CFG's
website at www.continentalfarmersgroup.com by no later than 12 noon
(London time) on the Business Day following the date of this
announcement. For the avoidance of doubt, the contents of that
website are not incorporated into, and do not form part of, this
announcement.
Any person to whom this announcement is sent may request a hard
copy of this announcement (and any information incorporated by
reference in this announcement) by contacting Appleby Trust (Isle
of Man) Limited (the CFG registered agent) during business hours on
+44 (0)1624 647647 or by submitting a request in writing to Appleby
Trust (Isle of Man) Limited at 33-37 Athol Street, Douglas IM1 1LB,
Isle of Man. It is important to note that unless such a request is
made, a hard copy of this announcement and any such information
incorporated by reference in it will not be sent to any such
person. Any person to whom this announcement is sent may also
request that all future documents, announcements and information
sent to that person in relation to the Offer be in hard copy
form.
Appendix 1
Conditions and certain further terms of the SCHEME
Part A: Conditions to the Scheme
1. The Scheme will be subject to the following Conditions:
(a) the Court Meeting taking place on or before the date that is
the twenty second day after the expected date of the Court Meeting
to be set out in the Scheme Document (or such later date (if any)
as UFHC and CFG may agree);
(b) the approval of the Scheme by a majority in number of the
CFG Shareholders who are present and vote, whether in person or by
proxy, at the Court Meeting and who represent not less than 75 per
cent. in value of the CFG Shares voted by those CFG
Shareholders;
(c) the Scheme petition being heard at the Court on or before
the date that is the twenty second day after the expected date of
the Scheme petition hearing to be set out in the Scheme Document
(or such later date (if any) as UFHC and CFG may agree);
(d) the sanction of the Scheme (with or without modification but
subject to any modification being on terms acceptable to UFHC and
CFG) by the Court and the delivery of a certified copy of the Court
Order, together with a copy of the Scheme and any accompanying
documents, to the Isle of Man Companies Registry within seven days
of the date of the Court Order; and
(e) the Scheme becoming effective on or before 5.00 p.m. on the Long Stop Date.
2. Subject as stated in Part B below and to the requirements of
the Panel in accordance with the Code, UFHC and CFG have agreed
that the Scheme will be subject to the following additional
Conditions:
Ukraine anti-trust approval
(a) approval of the acquisition of CFG by UFHC being received
from the AMC in a form reasonably satisfactory to UFHC;
Notifications, waiting periods and authorisations
(b) other than in relation to the matter referred to in
Condition 2(a), all material notifications, filings or applications
which are necessary or reasonably considered appropriate in
connection with the Offer having been made 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 having
been complied with in each case in respect of the Offer and all
Authorisations deemed necessary or reasonably appropriate by UFHC
in any jurisdiction for or in respect of the Offer and, except
pursuant to section 160 of the Isle of Man Companies Act 2006, the
acquisition or the proposed acquisition of any shares or other
securities in, or control or management of, CFG or any other member
of the CFG Group by UFHC having been obtained in terms and in a
form reasonably satisfactory to UFHC from all appropriate Third
Parties or (without prejudice to the generality of the foregoing)
from any person or bodies with whom any Consortium Group Member or
any member of the CFG Group has entered into contractual
arrangements and all such Authorisations necessary, appropriate or
desirable to carry on the business of any member of the CFG 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 wholly unconditional and there
being no notice or intimation of an intention to revoke, suspend,
restrict, modify or not to renew such Authorisations;
General anti-trust and regulatory
(c) other than in relation to the matter referred to in
Condition 2(a), no anti-trust regulator or Third Party having given
notice of a decision to take, institute, implement or threaten any
action, proceeding, suit, investigation, inquiry or reference (and
in each case, not having withdrawn the same), or having required
any action to be taken or otherwise having done anything, or having
enacted, made or proposed any statute, regulation, decision, order
or change to published practice (and in each case, not having
withdrawn the same) and there not continuing to be outstanding any
statute, regulation, decision or order which would or might
reasonably be expected to (in any case which is material in the
context of the Offer):
(i) require, prevent or materially delay or affect the
divestiture or materially prejudice the terms envisaged for such
divestiture by any Consortium Group Member or by any member of the
CFG Group of all or any material part of their respective
businesses, assets or property or of any CFG Shares or other
securities in CFG or impose any limitation on the ability of all or
any of them to conduct their businesses (or any part thereof) or to
own, control or manage any of their assets or properties (or any
part thereof) to an extent which is material in the context of the
relevant Consortium Group Member or member of the CFG Group (as the
case may be) taken as a whole;
(ii) except pursuant to section 160 of the Isle of Man Companies
Act 2006, require any Consortium Group Member or any member of the
CFG Group to acquire or offer to acquire any shares, other
securities (or the equivalent) or interest in any member of the CFG
Group or any asset owned by any Third Party (other than in the
implementation of the Offer);
(iii) impose any limitation on, or result in a delay in, the
ability of any Consortium Group Member directly or indirectly to
acquire, hold or to exercise effectively all or any rights of
ownership in respect of shares or other securities in CFG or on the
ability of any member of the CFG Group or any Consortium Group
Member directly or indirectly to hold or exercise effectively all
or any rights of ownership in respect of shares or other securities
(or the equivalent) in, or to exercise voting or management control
over, any member of the CFG Group to an extent which is material in
the context of the CFG Group or the relevant Consortium Group
Member (as the case may be) taken as a whole;
(iv) otherwise adversely affect any or all of the business,
assets, financial or trading position, profits or prospects of any
member of the CFG Group or any Consortium Group Member to an extent
which is material in the context of the CFG Group or the relevant
Consortium Group Member (as the case may be) taken as a whole;
(v) result in any member of the CFG Group or any Consortium
Group Member ceasing to be able to carry on business under any name
under which it presently carries on business;
(vi) make the Offer or its implementation, or the acquisition or
proposed acquisition of any shares or other securities in or
control of CFG by any Consortium Group Member, void, unenforceable
and/or illegal under the laws of any relevant jurisdiction, or
otherwise, directly or indirectly, prevent or prohibit, restrict,
restrain, or delay the same or otherwise interfere with the Offer
or its implementation, or impose material additional conditions or
obligations with respect to, or otherwise impede, interfere or
require amendment of the Offer or the acquisition or proposed
acquisition of any shares or other securities in or control of CFG
by any Consortium Group Member to an extent which is material in
the context of the Offer;
(vii) require, prevent or materially delay a divestiture by any
Consortium Group Member of any shares or other securities (or the
equivalent) in any member of the CFG Group or any Consortium Group
Member to an extent which is material in the context of the CFG
Group or relevant Consortium Group Member (as the case may be)
taken as a whole; or
(viii) impose any limitation on the ability of any Consortium
Group Member or any member of the CFG Group to conduct or integrate
all or any part of its business with all or any part of the
business of any other Consortium Group Member and/or the CFG Group
to an extent which is material in the context of the CFG Group or
the relevant Consortium Group Member (as the case may be) taken as
a whole,
and all applicable waiting and other time periods (including any
extensions thereof) during which any such anti-trust regulator or
Third Party could decide to take, institute, implement or threaten
any such action, proceeding, suit, investigation, enquiry or
reference or take any other step under the laws of any jurisdiction
in respect of the Offer having expired, lapsed or been
terminated;
Certain matters arising as a result of arrangement, agreement,
etc.
(d) except as Disclosed, there being no provision of any
arrangement, agreement, lease, licence, franchise, permit or other
instrument to which any member of the CFG Group is a party or by or
to which any such member or any of its assets is or may be bound,
entitled or subject or any event or circumstance which, as a
consequence of the Offer or because of a change in the control of
CFG or any other member of the CFG Group, could or might reasonably
be expected to result in (in any case to an extent which is or
would be material in the context of the CFG Group taken as a
whole):
(i) any monies borrowed by, or any other indebtedness, actual or
contingent, of, or any grant available to, any member of the CFG
Group being or becoming repayable, or capable of being declared
repayable, immediately or before its or their stated maturity date
or repayment date, or the ability of any such member to borrow
monies or incur any indebtedness being withdrawn or inhibited or
being capable of becoming or being withdrawn or inhibited;
(ii) 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 CFG Group or any such
mortgage, charge or other security interest (whenever created,
arising or having arisen) becoming enforceable;
(iii) any such arrangement, agreement, lease, licence,
franchise, permit or other instrument being terminated or the
rights, liabilities, obligations or interests of any member of the
CFG Group therein being adversely modified or adversely affected or
any obligation or liability arising or any adverse action being
taken or arising thereunder;
(iv) any liability of any member of the CFG Group to make any
severance, termination, bonus or other payment to any of its
directors or other officers;
(v) the rights, liabilities, obligations, interests or business
of any member of the CFG Group under any such arrangement,
agreement, lease, licence, franchise, permit or other instrument,
or the interests or business of any member of the CFG Group in or
with any other person, body, firm or company (or any agreement or
arrangement relating to any such interests or business) being or
becoming capable of being terminated, or adversely modified or
affected or any onerous obligation or liability arising or any
adverse action being taken thereunder;
(vi) any member of the CFG Group ceasing to be able to carry on
business under any name under which it presently carries on
business;
(vii) the value of, or the financial or trading position or
prospects of, any member of the CFG Group being prejudiced or
adversely affected; or
(viii) the creation or acceleration of any liability (actual or
contingent) by any member of the CFG Group other than trade
creditors or other liabilities incurred in the ordinary course of
business,
and no event having occurred which, under any provision of any
arrangement, agreement, lease, licence, franchise, permit or other
instrument to which any member of the CFG Group is a party or by or
to which any such member or any of its assets are bound, entitled
or subject, would be expected to result in any of the events or
circumstances as are referred to in Conditions 2(d)(i) to
2(d)(viii) (in each case to an extent which is material in the
context of the CFG Group taken as a whole);
Certain events occurring since 31 December 2011
(e) except as Disclosed, no member of the CFG Group having since 31 December 2011:
(i) issued or agreed to issue, or authorised or proposed or
announced its intention to authorise or propose 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, securities or
convertible securities (except, where relevant, as between CFG and
wholly-owned subsidiaries of CFG or between the wholly-owned
subsidiaries of CFG and except for the issue of CFG Shares on the
exercise of employee share options or vesting of employee share
awards in the ordinary course under the 2011 LTIP);
(ii) recommended, declared, paid or made or proposed to
recommend, declare, pay or make any bonus, dividend or other
distribution (whether payable in cash or otherwise) or dividends
(or other distributions whether payable in cash or otherwise) other
than any lawfully paid or made by any wholly-owned subsidiary of
CFG to CFG or any of its wholly-owned subsidiaries;
(iii) other than pursuant to the Offer (and except for
transactions between CFG and its wholly-owned subsidiaries or
between the wholly-owned subsidiaries of CFG and transactions in
the ordinary course of business) implemented, effected, authorised
or proposed or announced its intention to implement, effect,
authorise or propose any merger, demerger, reconstruction,
amalgamation, scheme, commitment, acquisition or disposal of assets
or shares or loan capital (or the equivalent thereof) in any
undertaking or undertakings in any such case to an extent which is
material in the context of the CFG Group taken as a whole;
(iv) (except for transactions between CFG and its wholly-owned
subsidiaries or between the wholly-owned subsidiaries of CFG)
disposed of, or transferred, mortgaged or created any security
interest over any asset or any right, title or interest in any
asset or authorised, proposed or announced any intention to do so
which in any case is material in the context of the CFG Group taken
as a whole;
(v) (except for transactions between CFG and its wholly-owned
subsidiaries or between the wholly-owned subsidiaries of CFG)
issued, authorised or proposed or announced an intention to
authorise or propose the issue of, or made any change in or to the
terms of, any debentures or become subject to any contingent
liability or incurred or increased any indebtedness which in any
case is material in the context of the CFG Group taken as a
whole;
(vi) entered into or varied or authorised, proposed or announced
its intention to enter into or vary any material contract,
arrangement, agreement, transaction or commitment (whether in
respect of capital expenditure or otherwise) except in the ordinary
course of business which is of a long term, unusual or onerous
nature or magnitude or which involves an obligation of a nature or
magnitude which is likely to be restrictive on the business of any
member of the CFG Group and which in any case is material in the
context of the CFG Group taken as a whole;
(vii) entered into or varied the terms of, or made any offer
(which remains open for acceptance) to enter into or vary to a
material extent the terms of, any contract, service agreement,
commitment or arrangement with any director or senior executive of
any member of the CFG Group save as agreed by UFHC;
(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
CFG Group save as agreed by UFHC;
(ix) purchased, redeemed or repaid or announced any proposal to
purchase, redeem or repay any of its own shares or other securities
or reduced or, except in respect of the matters mentioned in
sub-paragraph 2(e)(i) above, made any other change to any part of
its share capital, save as agreed by UFHC;
(x) waived, compromised or settled any claim (other than in the
ordinary course of business) which is material in the context of
the CFG Group taken as a whole;
(xi) terminated or varied the terms of any agreement or
arrangement between any member of the CFG Group and any other
person in a manner which would have a material adverse effect on
the financial position of the CFG taken as a whole;
(xii) other than pursuant to the Offer and as envisaged in
accordance with the terms of the Scheme, made any alteration to its
memorandum or articles of association or other incorporation
documents in each case which is material in the context of the
Offer;
(xiii) except in relation to changes made or agreed as a result
of, or arising from, changes to legislation, made or agreed or
consented to any change to the terms of the trust deeds and rules
constituting the pension scheme(s) established for its directors,
employees or their dependants or any material change to 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 upon which the liabilities (including
pensions) of such pension schemes are funded or made, or agreed or
consented to, in each case which is material in the context of the
CFG Group taken as a whole;
(xiv) been unable, or admitted in writing that it is unable, to
pay its debts or commenced negotiations with one or more of its
creditors with a view to rescheduling or restructuring any of its
indebtedness, 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, in
each case which is material in the context of the CFG Group taken
as a whole;
(xv) (other than in respect of a member of the CFG Group which
is dormant and was solvent at the relevant time) taken or proposed
any steps, corporate action or had any legal proceedings instituted
or threatened against it in relation to the suspension of payments,
a moratorium of any indebtedness, its winding-up (voluntary or
otherwise), dissolution, reorganisation or for the appointment of a
receiver, administrator, manager, administrative receiver, trustee
or similar officer of all or any material part of its assets or
revenues or any analogous or equivalent steps or proceedings in any
jurisdiction or appointed any analogous person in any jurisdiction
or had any such person appointed, in each case which is material in
the context of the CFG Group taken as a whole;
(xvi) (except for transactions between CFG and its wholly-owned
subsidiaries or between the wholly-owned subsidiaries of CFG) made,
authorised, proposed or announced an intention to propose any
change in its loan capital, in each case which is material in the
context of the CFG Group taken as a whole;
(xvii) entered into, implemented or authorised the entry into,
any joint venture, asset or profit sharing arrangement, partnership
or merger of business or corporate entities, in each case which is
material in the context of the CFG Group taken as a whole;
(xviii) entered into any licence or other disposal of
intellectual property rights of any member of the CFG Group which
are material in the context of the CFG Group and outside the normal
course of business; or
(xix) entered into any agreement, arrangement, commitment or
contract or passed any resolution or made any offer (which remains
open for acceptance) with respect to or announced an intention to,
or to propose to, effect any of the transactions, matters or events
referred to in this Condition 2(e);
No adverse change, litigation, regulatory enquiry or similar
(f) except as Disclosed, since 31 December 2011 there having been:
(i) no adverse change and no circumstance having arisen which
would or might be reasonably expected to result in any adverse
change in, the business, assets, financial or trading position or
profits or prospects or operational performance of any member of
the CFG Group which in any case is material in the context of the
CFG Group taken as a whole;
(ii) no litigation, arbitration proceedings, prosecution or
other legal proceedings (including, without limitation, with regard
to intellectual property rights owned or used by the CFG Group)
having been threatened, announced or instituted by or against or
remaining outstanding against or in respect of, any member of the
CFG Group or to which any member of the CFG Group is or may become
a party (whether as claimant, defendant or otherwise), in each case
which might reasonably be expected to have a material adverse
effect on the CFG Group taken as a whole or in the context of the
Offer;
(iii) no enquiry, review or investigation by, or complaint or
reference to, any Third Party against or in respect of any member
of the CFG Group having been threatened, announced or instituted or
remaining outstanding by, against or in respect of any member of
the CFG Group, in each case which might reasonably be expected to
have a material adverse effect on the CFG Group taken as a whole or
in the context of the Offer;
(iv) no contingent or other liability having arisen or become
apparent to UFHC or increased other than in the ordinary course of
business which would or might reasonably be expected to adversely
affect the business, assets, financial or trading position or
profits or prospects of any member of the CFG Group to an extent
which is material in the context of the CFG Group taken as a whole
or in the context of the Offer; and
(v) 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 CFG Group which is necessary for the proper carrying on of its
business and the withdrawal, cancellation, termination or
modification of which might reasonably be expected to have a
material adverse effect on the CFG Group taken as a whole or in the
context of the Offer;
No discovery of certain matters regarding information,
liabilities and environmental issues
(g) except as Disclosed, UFHC not having discovered:
(i) that any financial, business or other information concerning
the CFG Group Disclosed by or on behalf of any member of the CFG
Group before the date of this announcement is misleading, contains
a misrepresentation of any fact, or omits to state a fact necessary
to make that information not misleading, to an extent which in any
such case is material in the context of the CFG Group taken as a
whole;
(ii) that any member of the CFG Group or any partnership,
company or other entity in which any member of the CFG Group has a
significant economic interest and which is not a subsidiary
undertaking of CFG is, otherwise than in the ordinary course of
business, subject to any liability, contingent or otherwise and
which is material in the context of the CFG Group taken as a whole
or in the context of the Offer;
(iii) that any past or present member of the CFG Group has not
complied in any material respect with all applicable legislation,
regulations or other requirements of any jurisdiction or any
Authorisations relating to the use, treatment, storage, carriage,
disposal, discharge, spillage, release, leak or emission of any
waste or hazardous substance or any substance likely to impair the
environment (including any property) or harm human or animal health
or otherwise relating to environmental matters or the health and
safety of humans, which noncompliance would be likely to give rise
to any liability including any penalty for non-compliance (whether
actual or contingent) on the part of any member of the CFG Group
which in any case is material in the context of the CFG Group taken
as a whole;
(iv) that there has been a material disposal, discharge,
spillage, accumulation, release, leak, emission or the migration,
production, supply, treatment, storage, transport or use of any
waste or hazardous substance or any substance likely to impair the
environment (including any property) or harm human or animal health
which (whether or not giving rise to non-compliance with any law or
regulation), would be likely to give rise to any liability (whether
actual or contingent) on the part of any member of the CFG Group
which in any case is material in the context of the CFG Group taken
as a whole;
(v) that there is or is reasonably likely to be any obligation
or liability (whether actual or contingent) or requirement to make
good, remediate, repair, reinstate or clean up any property, asset
or any controlled waters currently or previously owned, occupied,
operated or made use of or controlled by any past or present member
of the CFG Group (or on its behalf), or in which any such member
may have or previously have had or be deemed to have had an
interest, under any environmental legislation, common law,
regulation, notice, circular, Authorisation or order of any Third
Party in any jurisdiction or to contribute to the cost thereof or
associated therewith or indemnify any person in relation thereto
which in any case is material in the context of the CFG Group taken
as a whole;
(vi) that circumstances exist (whether as a result of making the
Offer or otherwise) which would be reasonably likely to lead to any
Third Party instituting (or whereby any member of the CFG Group
would be likely to be required to institute) an environmental audit
or take any steps which would in any such case be reasonably likely
to result in any actual or contingent liability to improve or
install new plant or equipment or to make good, repair, reinstate
or clean up any property of any description or any asset now or
previously owned, occupied or made use of by any past or present
member of the CFG Group (or on its behalf) or by any person for
which a member of the CFG Group is or has been responsible, or in
which any such member may have or previously have had or be deemed
to have had an interest, which in any case is material in the
context of the CFG Group taken as a whole; or
(vii) that circumstances exist whereby a person or class of
persons have or is reasonably likely to have any legitimate claim
or claims in respect of any product or process, or materials used
therein, now or previously manufactured, sold, supplied or carried
out by any past or present member of the CFG Group which in each
case is material in the context of the CFG Group taken as a
whole.
Part B: Certain further terms of the Scheme and the Offer
1. Subject to the requirements of the Panel, UFHC reserves the
right to waive, in whole or in part, all or any of Conditions 2(a)
to 2(g) (inclusive).
2. The Scheme will not become effective unless the Conditions
have been fulfilled or (if capable of waiver) waived or, where
appropriate, have been determined by UFHC to be or remain satisfied
by no later than the Long Stop Date.
3. If UFHC is required by the Panel to make an offer for CFG
Shares under the provisions of Rule 9 of the Code, UFHC may make
such alterations to any of the above Conditions and terms of the
Offer as are necessary to comply with the provisions of that
Rule.
4. UFHC reserves the right to elect, with the consent of the
Panel and with CFG's prior written consent, to implement the Offer
by way of a Contractual Offer. In such event, the acquisition will
be implemented on substantially the same terms subject to
appropriate amendments (including, without limitation, an
acceptance condition set at 90 per cent. (or such lesser percentage
being more than 50 per cent. as UFHC may decide) of the shares to
which the Contractual Offer relates and of the voting rights
carried by those shares), so far as applicable, as those which
would apply to the Scheme.
The availability of the Scheme to persons not resident in the
United Kingdom or the Isle of Man may be affected by the laws of
the relevant jurisdictions. Persons who are not resident in the
United Kingdom or the Isle of Man should inform themselves about
and observe any applicable requirements.
The Scheme is not being made, directly or indirectly, in, into
or from, or by use of the mails of, or by any means of
instrumentality (including, but not limited to, facsimile, e-mail
or other electronic transmission, telex or telephone) of interstate
or foreign commerce of, or of any facility of a national, state or
other securities exchange of, any jurisdiction where to do so would
violate the laws of that jurisdiction.
Under Rule 13.5 of the Code, UFHC may not invoke a Condition to
the Offer so as to cause the Offer not to proceed, to lapse or to
be withdrawn unless the circumstances which give rise to the right
to invoke the condition are of material significance to UFHC in the
context of the Offer. The Condition contained in paragraph 1 of
Part A is not subject to this provision of the Code.
CFG Shares will be acquired by UFHC pursuant to the Scheme fully
paid and free from all liens, charges, equities, encumbrances,
rights of pre-emption and any other interests of any nature
whatsoever and together with all rights attaching thereto,
including voting rights and the rights to receive and retain in
full all dividends and other distributions declared, made or paid
on or after the Effective Date.
The Scheme will be governed by the law of the Isle of Man and
will be subject to the jurisdiction of the Isle of Man courts and
to the more detailed terms to be set out in the Scheme Document.
The Scheme will be subject to the applicable requirements of the
Code, the Panel, the London Stock Exchange, the Irish Stock
Exchange and is conditional, among other things, on approval by the
AMC in a form acceptable to UFHC.
Except with the consent of the Panel, the cash consideration for
the Offer shall be sent to CFG Shareholders within 14 days of the
Effective Date. If the Offer lapses or is withdrawn, all documents
of title and other documents lodged with any form of election will
be returned as soon as practicable (and in any event within 14 days
of such lapsing or withdrawal) and the receiving agent will
immediately give instructions for the release of securities held in
escrow.
Appendix 2
Irrevocable undertakings and Letter of intent
Part A: Irrevocable undertakings
(a) The following persons have given irrevocable undertakings to
vote in favour of the Scheme at the Court Meeting and to accept the
Basic Offer (or to procure such vote and acceptance) as
follows:
Name Number of CFG Shares Percentage of issued
share capital of CFG
(%)
---------------------------- --------------------- ----------------------
Nicholas Sherren Parker 663,820 0.41
---------------------------- --------------------- ----------------------
Julia Caroline Hamilton
Parker 153,189 0.09
---------------------------- --------------------- ----------------------
James Edward Hamilton
Parker 1,174,451 0.72
---------------------------- --------------------- ----------------------
Sarah Mary Hamilton
Parker 304,879 0.19
---------------------------- --------------------- ----------------------
Lucie Camilla Hamilton
Parker 304,879 0.19
---------------------------- --------------------- ----------------------
Crescent Trustees Limited
P301390 Acct (as trustee
of Nicholas Parker's
SIPP) 1,187,767 0.73
---------------------------- --------------------- ----------------------
Mark Charles Laird 11,629,845 7.11
---------------------------- --------------------- ----------------------
Sir Malcolm Leslie Rifkind 30,000 0.02
---------------------------- --------------------- ----------------------
Peter Eric Priestley 3,616,536 2.21
---------------------------- --------------------- ----------------------
Gerardine O'Connor 7,413,851 4.53
---------------------------- --------------------- ----------------------
Keith Dawson 2,408,892 1.47
---------------------------- --------------------- ----------------------
Origin International
Enterprises BV 39,640,345 24.25
---------------------------- --------------------- ----------------------
TOTAL 68,528,454 41.92
---------------------------- --------------------- ----------------------
In addition to the irrevocable undertakings with respect to CFG
Shares above:
(i) The irrevocable undertaking given by Mark Laird extends to
any CFG Shares issued to him under the 2011 LTIP. Awards over
2,212,000 CFG Shares have been made to Mark Laird under the 2011
LTIP of which awards over up to 1,106,000 CFG Shares are expected
to vest if the Scheme becomes effective.
(ii) Alastair Stewart, a CFG Director who currently holds no CFG
Shares, has irrevocably undertaken to accept the Offer in respect
of any CFG Shares issued to him pursuant to the 2011 LTIP. Awards
over 763,000 CFG Shares have been made to Alastair Stewart under
the 2011 LTIP of which awards over up to 381,500 CFG Shares are
expected to vest if the Scheme becomes effective.
(iii) The irrevocable undertaking given by Keith Dawson extends
to any CFG Shares issued to him under the 2011 LTIP. Awards over
240,000 CFG Shares have been made to Keith Dawson under the 2011
LTIP of which awards over up to 120,000 CFG Shares are expected to
vest if the Scheme becomes effective.
The undertakings referred to above shall only lapse if: (i) the
Scheme Document (or, if UFHC elects to implement the Offer by way
of a Contractual Offer, the offer document relating to the
Contractual Offer) is not published within 28 days of the date of
this announcement (or such longer period as UFHC, with the consent
of the Panel, determines); or (ii) in the event that the Offer is
implemented by way of a Contractual Offer, the Offer lapses or is
withdrawn; or (iii) in the event that the Offer is implemented by
way of a Scheme, the Scheme terminates or lapses in accordance with
its terms or otherwise becomes incapable of becoming effective,
provided that UFHC has not, within seven days of the Scheme having
so terminated or lapsed, announced in accordance with Rule 2 of the
Code that it intends to implement the Offer by way of a Contractual
Offer.
(b) The following persons have given irrevocable undertakings to
vote in favour of the Scheme at the Court Meeting and to elect to
receive the Cash Alternative (or to procure such vote and election)
as follows:
Name Number of CFG Shares Percentage of issued
share capital of CFG
(%)
--------------------------------- --------------------- ----------------------
Artemis Investment Management
LLP 12,349,694 7.55
--------------------------------- --------------------- ----------------------
F&C Management Limited
and F&C Investment Business
Limited 8,814,713 5.39
--------------------------------- --------------------- ----------------------
Rockhopper Investments
Limited 6,016,220 3.68
--------------------------------- --------------------- ----------------------
Polar Capital European
Forager Fund Ltd 5,742,726 3.51
--------------------------------- --------------------- ----------------------
Kleinwort Benson Investors
Dublin Limited and Kleinwort
Benson Investors International
Limited 5,259,264 3.22
--------------------------------- --------------------- ----------------------
Zurich Life Assurance
plc 4,842,726 2.96
--------------------------------- --------------------- ----------------------
TOTAL 43,025,343 26.32
--------------------------------- --------------------- ----------------------
The undertakings referred to above shall only lapse if: (i) the
Scheme Document (or, if UFHC elects to implement the Offer by way
of a Contractual Offer, the offer document relating to the
Contractual Offer) is not published within 28 days of the date of
this announcement (or such longer period as UFHC, with the consent
of the Panel, determines); or (ii) in the event that the Offer is
implemented by way of a Contractual Offer, the Offer lapses or is
withdrawn; or (iii) in the event that the Offer is implemented by
way of a Scheme, the Scheme terminates or lapses in accordance with
its terms or otherwise becomes incapable of becoming effective,
provided that UFHC has not, within seven days of the Scheme having
so terminated or lapsed, announced in accordance with Rule 2 of the
Code that it intends to implement the Offer by way of a Contractual
Offer; or (iv) a third party announces a cash offer (or a cash
alternative to a securities exchange offer) exceeding 39.6 pence
for each CFG Share.
Part B: Letter of intent
The following person has given a letter of intent to vote (or to
procure the voting) in favour of the Scheme at the Court Meeting as
follows:
Name Number of CFG Shares Percentage of issued
share capital of CFG
(%)
----------------------- --------------------- ----------------------
BGF World Agriculture
Fund 5,742,726 3.51
----------------------- --------------------- ----------------------
In the event that either (i) the Scheme Document is not sent to
CFG Shareholders within 28 days of the date of this announcement or
(ii) the Scheme does not become effective on or before 30 September
2013, the letter of intent referred to above shall automatically
lapse.
Appendix 3
Sources and Bases
1. Unless otherwise stated, financial information relating to
the CFG Group has been extracted or derived (without any
adjustment) from the audited annual report and accounts for CFG for
the year ended 31 December 2011 and CFG's announcement dated 28
March 2013 of its final results for the year ended 31 December 2012
(which are unaudited).
2. The value of the Offer is calculated by reference to the
price of 24.0 pence for each CFG Share, being the Closing Price on
27 March 2013, being the last Business Day before the date of this
announcement and on the basis of the fully diluted number of CFG
Shares in issue referred to in paragraph 4 below.
3. As at the close of business on 27 March 2013, being the last
Business Day before the date of this announcement, CFG had in issue
163,488,703 CFG Shares. The International Securities Identification
Number for CFG Shares is IM00B50X9K63.
4. The fully diluted share capital of CFG (being 166,266,203 CFG
Shares) is calculated on the basis of the number of issued CFG
Shares referred to in paragraph 3 above and assuming that awards
vest in respect of 2,777,500 CFG Shares under the 2011 LTIP.
5. Unless otherwise stated, all prices and closing prices for
CFG Shares are closing middle market quotations derived from the
London Stock Exchange Daily Official List.
Appendix 4
Definitions
The following definitions apply throughout this document unless
the context requires otherwise:
GBP, GBP, Sterling, pence or p the lawful currency of the UK
EUR Euro
2011 LTIP the CFG Long Term Incentive Plan
2011
AIM the Alternative Investment Market
of the London Stock Exchange
Almarai Almarai Company, a joint stock
company incorporated under the
laws of the Kingdom of Saudi Arabia
with commercial registration number
1010084223
AMC Antimonopoly Committee of Ukraine
Authorisations material authorisations, orders,
recognitions, grants, consents,
clearances, confirmations, certificates,
licences, permissions and approvals
Basic Offer the offer of 35 pence in cash for
each CFG Share plus the Deferred
Consideration (if any)
Business Day a day on which the London Stock
Exchange is open for business
Cash Alternative the offer of 36 pence in cash for
each CFG Share (with no entitlement
to any Deferred Consideration)
CFG Continental Farmers Group plc,
incorporated under the laws of
the Isle of Man with registration
number 2692V
CFG Directors the directors of CFG
CFG Group CFG, its subsidiaries and subsidiary
undertakings from time to time
CFG Shareholders holders of CFG Shares
CFG Shares the ordinary shares of EUR0.01
each in CFG
Closing Price the closing middle market quotation
of a CFG Share as derived from
the AIM appendix to the Daily Official
List
Code the City Code on Takeovers and
Mergers published by the Panel
Company CFG
Conditions the conditions to the implementation
of the Offer (including the Scheme)
as set out in Appendix 1 to this
announcement and to be set out
in the Scheme Document
Consortium SALIC, SGAF and Almarai
Consortium Group Member a Consortium Member, its parent
undertaking (if any) or any of
its subsidiaries, subsidiary undertakings
and associates
Consortium Members any of SALIC, SGAF and Almarai
Contractual Offer the implementation of the Offer
by means of a takeover offer under
section 974 of the UK Companies
Act, rather than by means of the
Scheme
Court the High Court of Justice of the
Isle of Man
Court Meeting the meeting of CFG Shareholders,
intended to be convened by the
Court, to approve the Scheme
Court Order the order of the Court sanctioning
the Scheme
CREST the relevant system (as defined
in the Uncertificated Securities
Regulations 2001 (SI 2001/3755))
in respect of which Euroclear UK
& Ireland limited is the operator
(as defined in such regulations)
in accordance with which securities
may be held and transferred in
uncertificated form
Daily Official List the Daily Official List of the
London Stock Exchange
Davy J&E Davy, trading as Davy including
its affiliate Davy Corporate Finance
Limited
Deferred Consideration up to a further 2 pence in cash
for each CFG Share payable under
the Basic Offer which is contingent
upon the amount of Relevant Land
registered on the Ukraine Register
during the Registration Period
Deloitte or Deloitte Corporate Deloitte Corporate Finance, a division
Finance of Deloitte LLP whose registered
office is at 2 New Street Square,
London EC4A 3BZ, United Kingdom,
Rule 3 adviser to CFG
Disclosed (a) disclosed in the annual report
and accounts of CFG for the period
ended 31 December 2011, (b) Publicly
Announced, (c) disclosed in this
announcement or (d) fairly disclosed
to UFHC, its officers or employees,
or its financial, legal or tax
advisers (specifically in their
capacity as UFHC's advisers in
relation to the Offer) by or on
behalf of CFG before the date of
this announcement
EBITDA earnings before interest, tax,
depreciation and amortisation
Effective Date the date on which all Conditions
to the Scheme are satisfied or
(where applicable) waived
ESM the Enterprise Securities Market
of the Irish Stock Exchange
Exchange Act US Securities Exchange Act of 1934
Existing Unregistered Leases unregistered leases of land in
the Ukraine leased by the CFG Group
as at 20 March 2013 from individuals
which are itemised in a schedule
agreed between UFHC and the CFG
Directors and initialled for identification
purposes by or on behalf of the
Consortium and the CFG Directors
Form of Election the form of election which will
accompany the Scheme Document under
which CFG Shareholders can elect
to accept the Cash Alternative
instead of the Basic Offer
Form of Proxy the form of proxy in connection
with the Court Meeting, which shall
accompany the Scheme Document
ha hectares
Irish Stock Exchange Irish Stock Exchange Limited
London Stock Exchange London Stock Exchange plc
Long Stop Date 30 September 2013 (or such later
date as UFHC and CFG may agree
and, if required, the Panel and
the Court may allow)
Nil Consideration Quarter any quarter period within the Registration
Period in respect of which no Deferred
Consideration has become payable
because insufficient Relevant Land
has been legally registered on
the Ukraine Register
Nomad AIM nominated adviser to the Company
Offer the offer for the entire issued
and to be issued share capital
of CFG by UFHC, to be implemented
by way of a Scheme or a Contractual
Offer, comprising the Basic Offer
and the Cash Alternative
Panel the Panel on Takeovers and Mergers
PIF Public Investment Fund of the Kingdom
of Saudi Arabia
Publicly Announced specifically disclosed in any public
announcements by CFG to any Regulatory
Information Service before the
date of this announcement
Registration Period the period commencing on 1 May
2013 and ending on 31 October 2014
Regulatory Information Service a service approved by the London
Stock Exchange for the distribution
to the public of AIM announcements
and included within the list maintained
on the London Stock Exchange's
website
Relevant Land land leased by the CFG Group which
forms part of the Existing Unregistered
Leases
Rule the relevant Rule of the Code
SALIC Saudi Agricultural and Livestock
Investment Co., a joint stock company
incorporated under the laws of
the Kingdom of Saudi Arabia with
commercial registration number
1010333057
SAR Saudi riyal
Scheme the scheme of arrangement proposed
to be made under section 157 of
the Isle of Man Companies Act 2006
between CFG and the CFG Shareholders
in connection with the Offer, with
or subject to any modification,
addition or condition approved
or imposed by the Court and agreed
to by UFHC and CFG
Scheme Document the document to be sent to, among
others, CFG Shareholders containing
and setting out, among other things,
the full terms and conditions of
the Scheme and containing the notice
convening the Court Meeting
SGAF Saudi Grains and Fodder Holding
LLC, a limited liability company
incorporated under the laws of
the Kingdom of Saudi Arabia with
commercial registration number
1010256569
Third Party a central bank, government or governmental,
quasi-governmental, supranational,
statutory, regulatory, environmental
or investigative body or authority,
court, trade agency, professional
association, institution, employee
representative body or any other
body or person whatsoever in any
jurisdiction
UFHC United Farmers Holding Company,
a company incorporated under the
laws of the Kingdom of Saudi Arabia
with commercial registration number
1010367910
UK or United Kingdom United Kingdom of Great Britain
and Northern Ireland
UK Companies Act Companies Act 2006
Ukraine Register the Ukraine State Real Property
Rights Register
US United States of America
For the purposes of this announcement, subsidiary, subsidiary
undertaking, wholly-owned subsidiary, parent undertaking,
undertaking and associate have the meanings given by sections 1152,
1159, 1161 and 1162 of the UK Companies Act.
References to an enactment include references to that enactment
as amended, replaced, consolidated or re-enacted by or under any
other enactment before or after the date of this announcement.
All references to time in this announcement are to London time
unless otherwise stated.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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