TIDMHAR
RNS Number : 9185P
Harvard International PLC
10 October 2011
For immediate release
10 October 2011
Statement re Possible Offer
NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION IN WHOLE OR IN PART
IN OR INTO ANY JURISDICTION WHERE TO DO SO WOULD CONSTITUTE A
VIOLATION OF THE RELEVANT LAWS OF SUCH JURISDICTION
This is an announcement falling under Rule 2.4 of the City Code
and does not constitute an announcement of a firm intention to make
an offer or to pursue any other transaction under Rule 2.7 of the
City Code. Accordingly, Harvard Shareholders are advised that there
can be no certainty that a formal offer for Harvard will be
forthcoming, even in the event that the pre-conditions set out in
paragraph 3 below are satisfied or waived.
Possible Cash Offer
for
Harvard International plc ("Harvard")
by
Geeya Technology (HongKong) Limited ("Bidco")
a wholly owned direct subsidiary of
Chengdu Geeya Technology Co., Ltd ("Geeya")
1. Introduction
The directors of Bidco, Geeya and Harvard are pleased to
announce that agreement in principle has been reached between
Harvard, Geeya and Bidco on the terms of a Possible Offer for the
entire issued and to be issued share capital of Harvard by Bidco, a
wholly owned direct subsidiary of Geeya. Geeya reserves the right
to implement any Offer through another of its wholly owned
subsidiaries if it so chooses.
The pre-conditions set out in paragraph 3 will be required to be
satisfied or waived prior to any Offer being made.
This Announcement is made under Rule 2.4 of the City Code and
does not constitute an announcement of a firm intention to make an
offer or to pursue any other transaction under Rule 2.7 of the City
Code. Accordingly, Harvard Shareholders are advised that there can
be no certainty that a formal offer for Harvard by Geeya or Bidco
will be forthcoming, even in the event that the pre-conditions set
out in paragraph 3 below are satisfied or waived.
2. The Possible Offer
If the Possible Offer proceeds, Harvard Shareholders would
receive:
for each issued and to be issued Harvard Share 45 pence in
cash
The Possible Offer would value the entire existing issued share
capital of Harvard at approximately GBP23.1 million and would
represent a premium of 100 per cent. to the Closing Price of
Harvard Shares of 22.5 pence on AIM on 27 September 2011 (being the
last Business Day immediately prior to the date on which Harvard
announced that it had received an approach from Geeya that might
lead to an offer for Harvard)
Any offer for Harvard would be subject to terms and conditions
customary for a recommended offer subject to the City Code and
would also be conditional upon the approval of Geeya
shareholders.
The Harvard Directors, who have been so advised by Investec,
have indicated they are supportive of unanimously recommending the
Possible Offer. In providing advice to the Harvard Directors,
Investec has taken into account the Harvard Directors' commercial
assessment of the Possible Offer.
Commenting on the Possible Offer, Mr Zhou, Chairman of Geeya
said:
"We are delighted to announce the possible acquisition of
Harvard, which, if it proceeds, would represent a significant step
in the implementation of Geeya's strategy to expand our
geographical presence, gain retail exposure for our set-top boxes
and benefit from the value of Harvard's brands. We look forward to
working with Harvard's management and employees to finalise this
possible acquisition."
Commenting on the Possible Offer, Ms Bridget Blow, Chairman of
Harvard said:
"The approach from Geeya represents an attractive opportunity
for shareholders to realise a substantial premium to the current
share price and recognises the value of the company's brands (such
as Goodmans) and its investment in STB technology."
3. Pre-conditions to the Offer Announcement
The issue of an Offer Announcement by Geeya or Bidco pursuant to
Rule 2.7 of the City Code is subject to satisfaction or waiver of
the following pre-conditions:
i. the unanimous recommendation of the Harvard Directors of the
terms of any such Offer, having been advised by Investec that the
terms of such an Offer are fair and reasonable;
ii. the receipt of all necessary approvals from regulatory
authorities in China relating to the Offer, including the
following:
o project approval for outbound investment from the Development
and Reform Commission of Sichuan Province in China;
o approval for outbound investment from the Ministry of Commerce
of China at provincial level;
o approval for the remittance of foreign exchange out of China
from the State Administration of Foreign Exchange of China; and
o approval of the Possible Offer by the China Securities
Regulatory Commission.
iii. the receipt by Geeya of irrevocable commitments from the
Directors of Harvard in respect of their entire beneficial holdings
of Harvard shares to accept the Offer; and
iv. the approvals of the Offer by the board of directors of
Geeya and the Geeya shareholders at a general shareholders' meeting
of Geeya.
Geeya reserves the right to waive any of these pre-conditions,
but even if all of these pre-conditions are satisfied or waived,
there can be no certainty that a firm offer will be
forthcoming.
On 28 September 2011 Harvard announced that it had received an
approach from Geeya that might lead to a possible offer for
Harvard.
On 19 September 2011 changes to the City Code took effect
relating to the requirement for a potential offeror to "put up or
shut up" or obtain a deadline extension following a possible offer
announcement. These changes require that by no later than 5.00 p.m.
on the 28th day following a possible offer announcement (i.e. 26
October 2011) Geeya must, unless the Panel has consented to an
extension of this 28 day deadline, announce either a firm intention
to make an offer or that it does not intend to make an offer, in
which case the announcement will be treated as an announcement to
which Rule 2.8 of the City Code applies.
Geeya has informed Harvard that obtaining the regulatory
consents referred to above may take 4 months from the date of this
announcement, or potentially longer. In light of this, Harvard
confirms that it currently intends to approach the Panel for an
extension to this deadline in due course. This deadline will only
be extended with the consent of the Panel in accordance with Rule
2.6(c) of the City Code.
Where the Panel consents to an extension of the deadline,
Harvard shall make an announcement setting out the new deadline and
commenting on the status of negotiations between Harvard and Geeya
as well as the anticipated timetable for satisfying or waiving the
pre-conditions to Geeya Bidco announcing a firm intention to make
an offer.
Every effort is being made by Harvard and Geeya to ensure that
the period in which regulatory consents are obtained is as short as
possible.
4. Information on Geeya and Bidco
Geeya
Geeya is a public company admitted to trading on the Shenzhen
Stock Exchange in China. Geeya manufactures and supplies digital
television network equipment and its products include a full series
of digital TV products from head-end to terminal-end, including
digital television support systems and consumer digital appliances,
including digital set top boxes. Geeya was founded in 1999and is
based in Chengdu, China.
As at 31 December 2010, Geeya had consolidated total assets of
RMB809.9 million (approximately GBP79.4 million) and reported a net
profit for the year ended 31 December 2010 of RMB53.8 million
(approximately GBP5.1 million).
Geeya's current intention is to finance any Offer through a
combination of its existing cash resources and bank facilities.
Bidco
Bidco is a newly incorporated Hong Kong company formed for the
purpose of potentially making the Offer and is wholly owned by
Geeya.
5. Information on Harvard
Harvard is a public company admitted to trading on AIM (trading
symbol: HAR). Harvard operates within the global consumer
electronics market focusing on added value digital vision products,
such as TV set-top boxes and recorders, targeting specific local
market opportunities such as the UK's popular, free-to-air TV
services. In addition, Harvard markets a range of accessories for
Apple's iPod, iPhone and iPad products in the UK under the iLuv
brand. It is also a major supplier of digital vision, radio, and
other personal consumer electrical products in Australia. Harvard
has comprehensive product development, procurement and logistical
operations based in the UK, Hong Kong and China.
6. Reasons for the Possible Offer
Geeya currently sells its existing products to Chinese based
businesses and has very limited experience of product exporting and
no previous retail experience. It has, however, recently been
seeking to expand its geographical presence and gain retail
exposure for its set-top boxes.
The Possible Offer presents an opportunity for Geeya to address
both of these strategic aims as Harvard has strong business links
and significant sales with retailers in both the UK and
Australia.
7. Current trading of Harvard
In its annual report for the year ended 31 March 2011, Harvard
reported a profit before tax of GBP0.9 million on turnover of
GBP61.2 million and had net assets of GBP19.6 million as at 31
March 2011.
8. Support for the Possible Offer by the Harvard Directors
The Harvard Directors, who have been so advised by Investec,
have indicated they are supportive of unanimously recommending the
Possible Offer. In providing advice to the Harvard Directors,
Investec has taken into account the Harvard Directors' commercial
assessment of the Possible Offer.
9. Background to and reason for the Harvard Directors' support
for the Possible Offer
In May 2011, discussions commenced between Harvard and Geeya. A
meeting between the Chief Executive Officer of Harvard and the
Chairman of Geeya in July 2011 subsequently lead to proposals from
Geeya for the Possible Offer.
If the Possible Offer proceeds to a formal Offer, it will
provide an opportunity for Harvard Shareholders to realise their
investment in Harvard at a significant premium to the current
market price, payable in cash.
10. Break Fee Agreement
Geeya and Harvard have entered into an agreement providing for
the payment to Harvard of a break fee of GBP500,000 (such sum to be
paid into escrow within 30 days of the release of this
announcement) if, inter alia, a formal offer document is not posted
to Harvard shareholders by Geeya on or before 30 March 2012.
11. General
The implications of the Possible Offer for Overseas Shareholders
may be affected by the laws of the relevant jurisdiction. Any
persons who are subject to the laws of any jurisdiction other than
the UK should inform themselves about and observe any applicable
requirements. It is the responsibility of each Overseas Shareholder
to satisfy himself as to the full observance of the laws of the
relevant jurisdiction in connection therewith, including the
obtaining of any governmental, exchange control or other consents
which may be required, or the compliance with other necessary
formalities which are required to be observed and the payment of
any issue, transfer or other taxes due in such jurisdiction.
This announcement and any Offer will be governed by English law
and will be subject to the jurisdiction of the English courts. This
announcement and any Offer will be subject to the applicable
requirements of the City Code.
Appendix I to this announcement provides details of the basis of
calculations and sources of certain information included in this
announcement.
Appendix II to this announcement contains definitions of certain
terms used in this announcement.
In accordance with Rule 30.4 of the City Code, a copy of this
announcement will be published on the following website:
www.harvardplc.com
Enquiries:
Harvard International plc
Bridget Blow, Chairman
Mike Ashley, Chief Executive Officer 020 8238 7650
Investec, financial adviser, nominated
adviser and corporate broker to
Harvard
James Grace 020 7597 4000
Seymour Pierce, financial adviser
to Geeya and Bidco
Jonathan Wright
Tom Sheldon 020 7107 8000
Seymour Pierce, which is authorised and regulated in the United
Kingdom by the Financial Services Authority, is acting exclusively
as financial adviser to Geeya and Bidco and no-one else in
connection with the Possible Offer and will not be responsible to
anyone other than Geeya and Bidco for providing the protections
afforded to clients of Seymour Pierce or for providing advice in
relation to the Possible Offer, the contents of this announcement
or any other matter referred to herein. Neither Seymour Pierce nor
any of its affiliates owes or accepts any duty, liability or
responsibility whatsoever (whether direct or indirect, whether in
contract, in tort, under statute or otherwise) to any person who is
not a client of Seymour Pierce in connection with this
announcement, any statement contained herein or otherwise.
Investec, which is authorised and regulated in the United
Kingdom by the Financial Services Authority, is acting exclusively
as financial adviser to Harvard and no-one else in connection with
the Possible Offer and will not be responsible to anyone other than
Harvard for providing the protections afforded to clients of
Investec or for providing advice in relation to the Possible Offer,
the contents of this announcement or any other matter referred to
herein. Neither Investec nor any of its affiliates owes or accepts
any duty, liability or responsibility whatsoever (whether direct or
indirect, whether in contract, in tort, under statute or otherwise)
to any person who is not a client of Investec in connection with
this announcement, any statement contained herein or otherwise.
The release, distribution or publication of this announcement in
jurisdictions other than the UK may be restricted by law and
therefore any persons who are subject to the laws of any
jurisdiction other than the UK should inform themselves about and
observe any applicable requirements. Copies of this announcement
and any documentation relating to the Possible Offer are not being,
and must not be, directly or indirectly, mailed or otherwise
forwarded, distributed or sent in or into or from any Restricted
Jurisdiction and persons receiving such documents (including
custodians, nominees and trustees) must not mail or otherwise
forward, distribute or send such documents in or into or from a
Restricted Jurisdiction. Any Offer, if it proceeds (unless
otherwise determined by Geeya and Bidco and permitted by applicable
law and regulation) will not be made, directly or indirectly, in or
into, or by the use of the mails, or by any means of
instrumentality (including without limitation, telephonically or
electronically) of interstate or foreign commerce of, or any
facilities of a national securities exchange of any Restricted
Jurisdiction, and such Offer will not be capable of acceptance from
or within any Restricted Jurisdiction.
This announcement is not intended to and does not constitute or
form any part of an offer to sell or an invitation to purchase or
the solicitation of an offer to subscribe for any securities or the
solicitation of any vote or approval in any jurisdiction pursuant
to the Possible Offer, any subsequent Offer or otherwise. If it
proceeds, any Offer will be made solely on the terms set out in the
Offer Document.
This announcement, including information included or
incorporated by reference in this announcement, may contain
"forward-looking statements" concerning Harvard, Geeya and Bidco.
Generally, the words "anticipate", "believe", "continue",
"estimate", "expect", "forecast", "intend", "may", "plan",
"project", "should" and "will" or similar expressions identify
forward-looking statements. Such statements reflect the relevant
company's current views with respect to future events and are
subject to risks and uncertainties that could cause the actual
results to differ materially from those expressed in the
forward-looking statements. Many of these risks and uncertainties
relate to factors that are beyond the companies' abilities to
control or estimate precisely, such as changes in general economic
and business conditions, changes in currency exchange rates and
interest rates, lack of acceptance of new exchange rates and
interest rates, introduction of competing products or services,
lack of acceptance of new products or services, changes in business
strategy and the behaviour of other market participants and
therefore undue reliance should not be placed on such statements.
Neither Harvard, Geeya or Bidco nor their respective affiliates
undertakes any obligation to update publicly or revise
forward-looking statements, whether as a result of new information,
future events or otherwise, except to the extent legally
required.
The Bidco Directors and the Geeya Directors accept
responsibility for the information contained in this announcement
other than information relating to Harvard, the Harvard Directors
and members of their immediate families, related trusts and persons
connected with them (within the meaning of section 252 of the
Act).
To the best of the knowledge and belief of each of the Bidco
Directors and the Geeya Directors (each of whom has taken all
reasonable care to ensure that such is the case), the information
contained in this announcement for which they are responsible is in
accordance with the facts and does not omit anything likely to
affect the import of such information.
The Harvard Directors accept responsibility for the information
contained in this announcement relating to Harvard, the Harvard
Directors and members of their immediate families and persons
connected with them (within the meaning of section 252 of the Act)
(save in each case for information on Bidco's future plans for
Harvard and its management and employees).
To the best of the knowledge and belief of the Harvard Directors
(each of whom has taken all reasonable care to ensure that such is
the case), the information contained in this announcement for which
they are responsible is in accordance with the facts and does not
omit anything likely to affect the import of such information.
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 prior to
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.
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 Requirement
In accordance with Rule 2.10 of the City Code, Harvard confirms
that, as of the date of the announcement, it has in issue
51,275,685 ordinary shares of 10 pence each (excluding ordinary
shares held in treasury). The International Securities
Identification Number ("ISIN") number of the ordinary shares is
GB0000130756.
APPENDIX I
BASES AND SOURCES OF INFORMATION
1. The value attributed to the entire issued share capital of
Harvard is based upon the 51,275,685 Harvard Shares in issue as at
the date of this announcement.
2. Unless otherwise stated, all prices for Harvard Shares are
the closing middle market quotation derived from AIM on the
relevant date.
3. References to a percentage of Harvard Shares are based on the
number of Harvard Shares in issue as set out in paragraph 1
above.
4. The exchange rates used to convert Renminbi into Sterling are
GBP1:RMB10.1961 for Geeya's 2010 consolidated net assets and
GBP1:RMB10.4489 for Geeya's 2010 net profit.
APPENDIX II
DEFINITIONS
In this announcement, unless the context otherwise requires, the
following expressions have the following meanings:
Act the Companies Act 2006 including any
statutory modification or re-enactment
thereof from time to time in force
------------------------- --------------------------------------------
AIM the AIM market operated by the London
Stock Exchange
Bidco Geeya Technology (HongKong) Limited
Bidco Directors the Directors of Bidco at the date
of this announcement
Business Day a day (other than a Saturday or a
Sunday) on which clearing banks are
generally open for the transaction
of usual banking business in the City
of London
City Code the City Code on Takeovers and Mergers
China The People's Republic of China
Closing Price the closing middle market quotation
of a share as derived from AIM
Conditions the conditions to the implementation
of the Offer and the Possible Offer
to be set out in any Offer Announcement
and 'Condition' means any one of them
Geeya Chengdu Geeya Technology Co., Ltd
Geeya Directors the directors of Geeya at the date
of the announcement
Harvard or the Company Harvard International plc
Harvard Directors the Directors of Harvard at the date
of this announcement
Harvard Shareholders holders of Harvard Shares
Harvard Shares the fully paid ordinary shares of
10 pence each in the capital of Harvard
Investec Investec Bank plc, which is authorised
and regulated in the UK by the Financial
Services Authority to carry on investment
business, as financial adviser to
Harvard
London Stock Exchange London Stock Exchange plc
Offer if an Offer Announcement is released,
the proposed recommended cash offer
by Bidco on the Principal Terms for
the entire issued and to be issued
ordinary share capital of Harvard,
including, where the context so requires,
any subsequent revision, variation,
extension or renewal thereof
Offer Announcement an announcement by Geeya or Bidco
of a firm intention to make an offer
for the entire issued and to be issued
share capital of Harvard on the Principal
Terms under Rule 2.7 of the City Code
Offer Document In relation to any Offer Announcement,
the document to be sent to Harvard
Shareholders and others which will
contain the terms and conditions of
the Offer and certain information
about Harvard, Bidco and Geeya
Offer Period has the meaning given to it in the
City Code
Overseas Shareholders Harvard Shareholders who are resident
in, ordinarily resident in, or citizens
of, jurisdictions outside the UK
Panel the Panel on Takeovers and Mergers
Possible Offer the possible Offer contemplated by
Bidco
Pounds or GBP pounds sterling, the lawful currency
of the UK
Principal Terms in relation to any Offer Announcement,
the Offer referred to in such announcement
being on terms that (i) the price
payable for each Harvard Share is
no less than 45 pence per Harvard
Share, (ii) such price is payable
in cash; and (iii) the Offer is subject
to the Conditions
Restricted Jurisdiction subject always to the requirements
of Rule 30.3 of the City Code in relation
to the distribution of offer documentation
to jurisdictions outside the UK, any
jurisdiction where extension of the
Possible Offer would violate the law
of that jurisdiction
RMB Renminbi, the lawful currency of China
Seymour Pierce Seymour Pierce Limited, which is authorised
and regulated in the UK by the Financial
Services Authority to carry on investment
business, as financial adviser to
Geeya and Bidco
UK or the United Kingdom the United Kingdom of Great Britain
and Northern Ireland (and its dependent
territories)
The expressions 'subsidiary', 'subsidiary undertaking',
'undertaking' and 'associated undertaking' have the meanings given
by the Act including any statutory modification or re-enactment of
them for the time being in force. All references to time in this
document are to London time.
Words importing the singular shall include the plural and vice
versa, and words importing the masculine gender shall include the
feminine or neutral gender.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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