ISG PLC Change of Board recommendation (3168P)

TIDMISG

RNS Number : 3168P

ISG PLC

17 February 2016

NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN WHOLE OR IN PART, IN, INTO, OR FROM ANY JURISDICTION WHERE TO DO SO WOULD CONSTITUTE A VIOLATION OF THE RELEVANT LAWS OR REGULATIONS OF THAT JURISDICTION

ISG plc ("ISG" or the "Company")

Change of Board recommendation in response to announcement from Cathexis UK Holdings Limited ("Cathexis") that it has an interest in 48.4% of the issued share capital of ISG

Further to its circular of 5 February 2016, the Board of ISG, together with its advisers, has re-considered the revised offer from Cathexis of 171p per ISG Share (the "Offer") in light of today's Rule 8.1 announcement by Cathexis disclosing that it and its concert parties now have an interest in 48.4% of the issued share capital of the Company. This represents an increase of 9.4% from the level of 39.0% disclosed in yesterday's equivalent announcement.

At the time of publication of the Company's circular of 5 February 2016, Cathexis had announced that it owned 34.5% of the issued share capital of the Company and your Board stated that one of the factors that it had taken into account in its assessment of the Offer was the potential impact on Shareholders of actions that Cathexis could take as a result of having such a significant shareholding. Your Board noted specifically that should the Offer fail to become unconditional and lapse, Cathexis would remain a significant minority Shareholder and this level of shareholding may be used to influence the Group's strategy, the composition of the Board or the payment of dividends, to the potential detriment of Shareholders as a whole.

The Board has now re-assessed each of the factors that it set out in the Recommendation section of Part 1 of the circular of 5 February 2016 and, in doing so, has placed increased weight on the fact that, even if the Offer should fail to become unconditional and lapse, Cathexis would now be such a significant minority Shareholder that it would be extremely difficult and unlikely for other Shareholders to have influence in any Shareholder vote requiring a simple majority of those attending and voting (in person or by proxy). As such, Cathexis could take actions that may be to the potential detriment of Shareholders. The Board considers that it is in the best interests of the Company that the Company's ownership should be clear to all stakeholders including employees, clients, subcontractors and funders.

The Board, which has been so advised by Numis as to the financial terms of the Offer, continues to consider that the Offer undervalues the Company and its prospects. However, in view of Cathexis' significant shareholding and for the reasons stated above, the Board believes accepting the Offer to be in the best interests of the Shareholders as a whole and now unanimously recommends that Shareholders accept the Offer. In providing advice to the Directors, Numis has taken into account the Directors' commercial assessments.

ISG will be writing to Shareholders with its revised formal response to the Offer.

ALL ISG SHAREHOLDERS ARE NOW ADVISED TO ACCEPT THE OFFER

Enquiries:

ISG plc

 
David Lawther, Chief Executive Officer     020 7392 5250 
Jonathan Houlton, Group Finance Director

Numis

 
Michael Meade                     020 7260 1000 
Stuart Ord 
Ben Stoop 
 
  Instinctif 
Matthew Smallwood, Helen Tarbet   020 7457 2020

Disclaimer

Numis Securities Limited, which is authorised and regulated in the United Kingdom by the Financial Conduct Authority, is acting exclusively for ISG and no one else in connection with the Offer and the contents of this announcement and will not be responsible to anyone other than ISG for providing the protections afforded to its clients nor for providing advice in connection with the Offer or any matter referred to herein.

Publication on Website

A copy of this announcement will be available on the Company's website (www.isgplc.com) by no later than 12 noon (London time) on 18 February 2016. The content of the website referred to in this announcement is not incorporated into and does not form part of this announcement.

No Material Changes

Save for the change in recommendation set out in this announcement and the withdrawal of the letters of intent not to accept the Offer from the Directors of ISG, the Directors of ISG are not aware of any material changes to the information contained in the circular issued by the Company on 5 February 2016 in respect of the matters listed under Rule 27.2(c) of the Takeover Code.

Responsibility statement

The Directors of ISG accept responsibility for the information contained in this announcement. To the best of the knowledge and belief of the Directors, who have taken all reasonable care to ensure such is the case, the information contained in this announcement is in accordance with the facts and does not omit anything likely to affect the import of such information.

This information is provided by RNS

The company news service from the London Stock Exchange

END

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(END) Dow Jones Newswires

February 17, 2016 03:33 ET (08:33 GMT)

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