Offer for Biffa Plc

8th Feb 2008 07:00

WasteAcquisitionCo Limited08 February 2008 For immediate release 8 February 2008 Not for release, publication or distribution, in whole or in part, in or into or from any jurisdiction where to do so would constitute a violation of the relevant laws or regulations of such jurisdiction RECOMMENDED ACQUISITION of BIFFA PLC by WASTEACQUISITIONCO LIMITED to be effected by means of a scheme of arrangement under the Companies Acts Summary • The Boards of WasteAcquisitionco Limited ("Bidco") and BiffaPlc ("Biffa") are pleased to announce that they have reached agreement on theterms of a recommended acquisition of the entire issued and to be issued sharecapital of Biffa by Bidco, a newly incorporated company specifically formed forthe purpose of making the Acquisition which is owned indirectly by variousentities within the Montagu Funds and the GIP Funds and by UCIL. • Under the terms of the Acquisition, Biffa Shareholders willreceive 350 pence in cash for each Biffa Share they hold, valuing Biffa's fullydiluted share capital at approximately £1,231 million, and the existing issuedshare capital of Biffa at approximately £1,225 million. Acquisition highlights • The price of 350 pence per Biffa Share represents a premium of: - 42.9 per cent. to the average Closing Price of 244.8 pence per BiffaShare for the three month period to 22 November 2007, being the last BusinessDay prior to the commencement of the Offer Period; and - 34.4 per cent. to the Closing Price of 260.5 pence per Biffa Share on22 November 2007, being the last Business Day prior to the commencement of theOffer Period. • A Loan Note Alternative will also be made available to BiffaShareholders (other than Restricted Overseas Persons). • The Biffa Directors, who have been so advised by Citi, JPMorganCazenove and Tricorn Partners, consider the terms of the Acquisition to be fairand reasonable. In providing their advice to the Biffa Directors, Citi, JPMorganCazenove and Tricorn Partners have taken into account the Biffa Directors'commercial assessments. • The Biffa Directors consider the terms of the Acquisition to bein the best interests of Biffa Shareholders as a whole and accordingly haveunanimously agreed to recommend that Biffa Shareholders vote in favour of thespecial resolution relating to the Acquisition to be proposed at the EGM andvote in favour of the Scheme at the Court Meeting, as they have irrevocablyundertaken to do in respect of their own beneficial holdings, amounting inaggregate to 308,580 Biffa Shares, representing approximately 0.09 per cent. ofthe existing issued share capital of Biffa. Irrevocable undertakings • Bidco has received irrevocable undertakings to vote in favourof the Acquisition at: - the Court Meeting in respect of, in aggregate, 308,580 Biffa Shares,representing approximately 0.09 per cent. of the existing issued share capitalof Biffa; and - the EGM in respect of, in aggregate, 8,860,146 Biffa Shares,representing approximately 2.53 per cent. of the existing issued share capitalof Biffa. General • It is intended that the Acquisition will be implemented bymeans of a Court sanctioned scheme of arrangement under the Companies Acts. • The Scheme Document, containing further details of theAcquisition, will be posted to Biffa Shareholders as soon as practicable.Resolutions to approve the Scheme will be put to Biffa Shareholders at the CourtMeeting and the EGM. It is expected that the Court Meeting and the EGM toapprove the Scheme and the Capital Reduction will be held in March 2008. Subjectto the satisfaction or waiver of the Conditions, it is expected that the Schemewill become effective by the end of April 2008. Commenting on the Acquisition, Jason Gatenby of Montagu said: "We are delighted that the Board of Biffa has unanimously agreed to recommendour proposed acquisition of Biffa. Both the Montagu Funds and GIP Funds arelong-term investors and together we look forward to building on Biffa's leadingposition across all areas of the waste management value chain. Biffa meets thecriteria we look for in a business: it is a market leading business with a greatworkforce in a sector we understand well and where we have a demonstrable trackrecord of success. In GIP we have an outstanding partner who shares our visionfor the future of Biffa's business." Commenting on the Acquisition, Matthew Harris of GIP said: "We are very pleased to announce our joint offer for Biffa. The Acquisitionrepresents an attractive opportunity for GIP to invest in the UK wastemanagement industry and establish our presence in this key infrastructuresector. We believe that waste management represents a critical infrastructureservice and that the future prospects across the industry in the UK areexciting. Along with our experienced partner Montagu Private Equity, we lookforward to working with Biffa's management to build on the solid customerfranchise and market position that Biffa enjoys today." Commenting on the Acquisition, Bob Davies, Non-Executive Chairman of Biffa said: "We are pleased to have reached agreement with Montagu Private Equity and GIP.Their offer recognises considerable value inherent in our market position andintegrated business model, and I believe their investment plans will help Biffamaximise the opportunities presented by changing legislation to deliver growthinto the medium term." This summary should be read in conjunction with the full text of thisannouncement. The Acquisition will be subject to the Conditions which are setout in Appendix I to this announcement and the full conditions and further termsto be set out in the Scheme Document. Press enquiries For further information contact:BidcoJason Gatenby Tel: 020 7336 9955Matthew Harris Tel: 020 7883 3100 UBS Investment Bank Tel: 020 7567 8000(Joint financial adviser and broker to Bidco)Liam BeereJackie Lee Deutsche Bank Tel: 020 7545 8000(Joint financial adviser and broker to Bidco)Alan BrownRick HenryAlexis Maskell Merrill Lynch Tel: 020 7628 1000(Joint financial adviser and broker to Bidco)Kevin J SmithKarl Lim PricewaterhouseCoopers LLP Tel: 020 7583 5000(Joint financial adviser to Bidco)Malcolm WrenJon Raggett Maitland Tel: 020 7379 5151(Public relations adviser to Bidco)Peter Ogden Financial Dynamics Tel: 020 7831 3113(Public relations adviser to Bidco)Paul MarriottEdward Berry BiffaMartin Bettington Tel: 01494 556 400 (Chief Executive Officer) Citi Tel: 020 7986 4000(Joint financial adviser and broker to Biffa)Simon LindsayMark ToddCharles Lytle JPMorgan Cazenove Tel: 020 7588 2828(Joint financial adviser and broker to Biffa)Robert ConstantBarry Weir Tricorn Partners Tel: 020 7823 0888(Rule 3 adviser to Biffa)Justin Dowley Tulchan Tel: 020 7353 4200(Public relations adviser to Biffa)David TrenchardDavid Allchurch This announcement is not intended to and does not constitute, or form any partof, an offer to sell or an invitation to subscribe for or purchase anysecurities or the solicitation of any vote or approval in any jurisdictionpursuant to the Acquisition or otherwise. The Acquisition will be made solelythrough the Scheme Document, which will contain the full terms and conditions ofthe Acquisition (including details on how to vote in respect of theAcquisition). Any response in relation to the Acquisition should be made only onthe basis of the information contained in the Scheme Document or any otherdocument by which the Acquisition is made. Biffa Shareholders are advised toread carefully the formal documentation in relation to the Acquisition once ithas been despatched. This announcement does not constitute a prospectus orprospectus equivalent document. UBS is acting exclusively for Bidco and for no one else in connection with theAcquisition and will not regard any other person as its client nor beresponsible to anyone other than Bidco for providing the protections afforded toclients of UBS, nor for providing advice in relation to the Acquisition, thecontents of this announcement or any matter referred to herein. Deutsche Bank is authorised under German banking law (competent authority: BaFin- Federal Financial Supervising Authority) and regulated by the FinancialServices Authority for the conduct of UK business. Deutsche Bank is acting forBidco and no one else in connection with the Acquisition and will not beresponsible to anyone other than Bidco for providing the protections afforded toclients of Deutsche Bank, nor for providing advice in relation to theAcquisition, the contents of this announcement or any matter referred to herein. Merrill Lynch, which is authorised and regulated in the United Kingdom by theFinancial Services Authority is acting exclusively for Bidco and no one else inconnection with the Acquisition and will not be responsible to anyone other thanBidco for providing the protections afforded to clients of Merrill Lynch, norfor providing advice in relation to the Acquisition, the contents of thisannouncement or any matter referred to herein and the accompanying documents. PricewaterhouseCoopers LLP, which is authorised and regulated in the UnitedKingdom by the Financial Services Authority, is acting exclusively for Bidco andno one else in connection with the Acquisition and will not be responsible toanyone other than Bidco for providing the protections afforded to clients ofPricewaterhouseCoopers LLP or for giving advice in relation to the Acquisitionor any other matter referred to in this announcement. Citi, which is authorised and regulated in the United Kingdom by the FinancialServices Authority, is acting for Biffa and for no one else in relation to theAcquisition and will not be responsible to anyone other than Biffa for providingthe protections afforded to clients of Citi, nor for providing advice inrelation to the Acquisition, the contents of this announcement or any othermatter referred to herein. JPMorgan Cazenove, which is authorised and regulated in the United Kingdom bythe Financial Services Authority, is acting exclusively for Biffa and for no oneelse in relation to the Acquisition and will not regard any other person as itsclient nor be responsible to anyone other than Biffa for providing theprotections afforded to clients of JPMorgan Cazenove, nor for providing advicein relation to the Acquisition, the contents of this announcement or any othermatter referred to herein. Tricorn Partners LLP, which is authorised and regulated in the United Kingdom bythe Financial Services Authority, is acting exclusively for Biffa and no oneelse in connection with the Acquisition and this announcement and will not beresponsible to anyone other than Biffa for providing the protections afforded toclients of Tricorn Partners LLP nor for providing advice in connection with theAcquisition or this announcement or any matter referred to herein. Overseas persons The release, publication or distribution of this announcement in or intojurisdictions other than the United Kingdom may be restricted by law andtherefore persons into whose possession this announcement comes should informthemselves about, and observe, any applicable restrictions. Any failure tocomply with such restrictions may constitute a violation of the securities lawsof any such jurisdiction. This announcement has been prepared for the purpose ofcomplying with English law and the City Code and the information disclosed maynot be the same as that which would have been disclosed if this announcement hadbeen prepared in accordance with the laws of jurisdictions outside the UnitedKingdom. The Loan Notes that may be issued pursuant to the Acquisition have not been andwill not be registered under the US Securities Act or under the relevantsecurities laws of any state or territory or other jurisdiction of the UnitedStates. Accordingly, Loan Notes may not be offered or sold in the United States,except in a transaction not subject to, or in reliance on an exemption from, theregistration requirements of the US Securities Act and such state securitieslaws. Any Loan Notes which may be issued pursuant to the Acquisition have not been andwill not be registered under the relevant securities laws of Japan and anyrelevant clearances and registrations have not been, and will not be, obtainedfrom the securities commission of any province of Canada. No prospectus inrelation to the Loan Notes has been, or will be, lodged with, or registeredwith, the Australian Securities and Investments Commission, the JapaneseMinistry of Finance or the New Zealand Companies Office. Accordingly, unlessotherwise determined by Bidco and permitted by applicable law and regulation,the Loan Notes may not be offered, sold, resold, transferred, delivered ordistributed, directly or indirectly in or into Australia, Canada, Japan or NewZealand or any other jurisdiction where to do so would violate the laws of thatjurisdiction or would require registration thereof in such jurisdiction. Shareholders in the United States should note that the Scheme relates to theshares of a UK company and will be governed by English law. Neither the proxysolicitation nor the tender offer rules under the US Securities Exchange Act of1934, as amended, will apply to the Scheme. Moreover, the Scheme will be subjectto the disclosure requirements and practices applicable in the UK to schemes ofarrangement, which differ from the disclosure requirements of the US proxysolicitation rules and tender offer rules. Financial information included inthis announcement and the Scheme documentation has been or will have beenprepared in accordance with accounting standards applicable in the UK that maynot be comparable to financial information of US companies or companies whosefinancial statements are prepared in accordance with generally acceptedaccounting principles in the United States. If Bidco exercises its right toimplement the acquisition of the Biffa Shares by way of the Offer, the Offer, ifmade into the United States, will be made in compliance with applicable UStender offer and securities laws and regulations. If the Acquisition is carried out by way of the Offer and unless otherwisedetermined by Bidco or required by the City Code, and permitted by applicablelaw and regulation, the Offer will not be made, directly or indirectly, in orinto or from, or by use of the mail, or by any means or instrumentality(including, without limitation, telex, facsimile transmission, telephone,internet or other forms of electronic communication) of interstate or foreigncommerce of, or by any facilities of a national securities exchange of, aRestricted Jurisdiction and the Offer cannot be accepted by any such use, meansor instrumentality or otherwise from or within a Restricted Jurisdiction.Accordingly, copies of this announcement are not being, and must not be, mailedor otherwise forwarded, distributed or sent in or into or from any suchjurisdiction where to do so would constitute a breach of the securities laws inthat jurisdiction. Persons receiving this announcement (including, withoutlimitation, custodians, nominees and trustees) should observe these restrictionsand should not send or distribute this announcement in, into or from any suchjurisdictions. No listing authority or equivalent has reviewed, approved or disapproved of thisannouncement or any of the proposals described herein. Forward looking statements This announcement, including information included or incorporated by referencein this announcement, may contain "forward-looking statements" concerning Biffaand Bidco. Generally, the words "will", "may", "should", "continue", "believes","expects", "intends", "anticipates" or similar expressions identifyforward-looking statements. The forward-looking statements involve risks anduncertainties that could cause actual results to differ materially from thoseexpressed in the forward-looking statements. Many of these risks anduncertainties relate to factors that are beyond the companies' abilities tocontrol or estimate precisely, such as future market conditions and thebehaviours of other market participants, and therefore undue reliance should notbe placed on such statements. Neither Bidco nor Biffa assumes any obligation anddoes not intend to update these forward-looking statements, except as requiredpursuant to applicable law. Nothing in this announcement is intended, or is to be construed, as a profitforecast or to be interpreted to mean that earnings per Biffa Share for thecurrent or future financial years, or those of the combined group, willnecessarily match or exceed the historical published earnings per Biffa Share. Dealing disclosure requirements Under the provisions of Rule 8.3 of the City Code, if any person is, or becomes,"interested" (directly or indirectly) in one per cent. or more of any class of "relevant securities" of Biffa, all "dealings" in any "relevant securities" ofBiffa (including by means of an option in respect of, or a derivative referencedto, any such "relevant securities") must be publicly disclosed by no later than3.30 pm (London time) on the Business Day following the date of the relevanttransaction. This requirement will continue until the Effective Date or when the"offer period" otherwise ends. If two or more persons act together pursuant toan agreement or understanding, whether formal or informal, to acquire an "interest" in "relevant securities" of Biffa, they will be deemed to be a singleperson for the purpose of Rule 8.3 of the City Code. Under the provisions of Rule 8.1 of the City Code, all "dealings" in "relevantsecurities" of Biffa by Bidco or by Biffa or by any of their respective "associates" for their own account during an "offer period", must be privatelyand publicly disclosed by no later than 12 noon (London time) on the BusinessDay following the date of the relevant transaction. A disclosure table, giving details of the companies in whose "relevantsecurities" "dealings" should be disclosed, and the number of such securities inissue, can be found on the Panel's website at www.thetakeoverpanel.org.uk. "Interests in securities" arise, in summary, when a person has long economicexposure, whether conditional or absolute, to changes in the price of "relevantsecurities". In particular, a person will be treated as having an "interest" byvirtue of the ownership or control of securities, or by virtue of any option inrespect of, or derivative referenced to, securities. Terms in quotation marks are defined in the City Code, which can also be foundon the Panel's website. If you are in any doubt as to whether or not you arerequired to disclose a "dealing" under Rule 8 of the City Code, you shouldcontact an independent financial adviser authorised under the Financial Servicesand Markets Act 2000 or consult the Panel's website or contact the Panel ontelephone number +44 (0) 20 7638 0129. In accordance with normal UK market practice, Bidco or its nominees or brokers(acting as agents) may from time to time make certain purchases of, orarrangements to purchase, Biffa Shares outside the United States, other thanpursuant to the Scheme, prior to the Scheme Effective Date. These purchases mayoccur either in the open market at prevailing prices or in private transactionsat negotiated prices. Any information about such purchases will be disclosed asrequired in the UK. For immediate release 8 February 2008 Not for release, publication or distribution, in whole or in part, in or into or from any jurisdiction where to do so would constitute a violation of the relevant laws or regulations of such jurisdiction RECOMMENDED ACQUISITION of BIFFA PLC by WASTEACQUISITIONCO LIMITED to be effected by means of a scheme of arrangement under the Companies Acts 1 Introduction The Boards of Bidco and Biffa are pleased to announce that they have reachedagreement on the terms of a recommended acquisition of the entire issued and tobe issued share capital of Biffa by Bidco, a newly incorporated companyspecifically formed for the purpose of making the Acquisition which is ownedindirectly by various entities within the Montagu Funds and the GIP Funds and byUCIL. 2 The Acquisition It is intended that the Acquisition will be implemented by means of a Courtsanctioned scheme of arrangement under the Companies Acts. Under the terms ofthe Scheme, which will be subject to the Conditions and further terms set out inthis announcement and to be set out in the Scheme Document, Scheme Shareholderswill, subject to elections under the Loan Note Alternative, receive: for each Biffa Share 350 pence in cash The price of 350 pence per Biffa Share represents a premium of: • 42.9 per cent. to the average Closing Price of 244.8 pence per BiffaShare for the three month period prior to 22 November 2007, being the lastBusiness Day prior to the commencement of the Offer Period; and • 34.4 per cent. to the Closing Price of 260.5 pence per Biffa Share on22 November 2007, being the last Business Day prior to the commencement of theOffer Period. The Acquisition values the fully diluted share capital of Biffa at approximately£1,231 million, and the existing issued share capital of Biffa at approximately£1,225 million. As an alternative to receiving some or all of the cash consideration, SchemeShareholders (other than Restricted Overseas Persons (who may not participate inthe Loan Note Alternative)) will, subject to the conditions and further termswhich will be set out in the Scheme Document and the Form of Election, be ableto elect to receive Loan Notes to be issued by Bidco (and guaranteed by HSBC) onthe following basis: for every £1 of cash consideration £1 nominal value of Loan Notes The Scheme Document, containing further details of the Acquisition, will beposted to Biffa Shareholders as soon as practicable. Resolutions to approve theScheme will be put to Biffa Shareholders at the Court Meeting and the EGM. It isexpected that the Court Meeting and the EGM to approve the Scheme and theCapital Reduction will be held in March 2008. Subject to the satisfaction orwaiver of the Conditions, it is expected that the Scheme will become effectiveby the end of April 2008. 3 Background to and reasons for the Acquisition The Montagu Private Equity funds are long established investors in the Europeanprivate equity market. Montagu Private Equity has significant sector expertisethrough its previous investment in Cory Environmental and has followed Biffaclosely since its demerger from Severn Trent. Global Infrastructure Partnersinvests in infrastructure assets and businesses on a global basis. GlobalInfrastructure Partners' investments include its acquisition, with an affiliateof American International Group, of London City Airport in December 2006.Montagu Private Equity and Global Infrastructure Partners plan to build onBiffa's position across all areas of the waste management value chain. UCIL isstrongly supportive of Montagu Private Equity's and Global InfrastructurePartners' objectives for Biffa. 4 Background to and reason for the recommendation On 26 November 2007, the Board of Biffa announced that it had rejected anindicative proposal of 330 pence per Biffa Share from Montagu Private Equity, onbehalf of the Montagu Funds, and HgCapital. On 7 December 2007, the Board ofBiffa received a revised proposal of 350 pence per Biffa Share, on the basis ofwhich the Board of Biffa agreed to give Montagu Private Equity and HgCapitalaccess to company information to complete their confirmatory due diligence. On 24 January 2008, the Board of Biffa announced that it had receivednotification that Montagu Private Equity continued to be interested in pursuinga cash offer for Biffa at a price of 350 pence per Biffa Share, on behalf of theMontagu Funds, and had agreed to work together with Global InfrastructurePartners to complete their due diligence. The Board of Biffa receivednotification that HgCapital no longer wished to pursue making an offer forBiffa. This announcement represents the successful conclusion of MontaguPrivate Equity and GIP's due diligence. After the announcement on 24 January 2008, the Board of Biffa and their advisersalso received approaches from third parties regarding their potential interestin making an offer for Biffa. The third parties have been given the same accessto due diligence information as Montagu Private Equity and Global InfrastructurePartners and continue to work on a possible offer for the Company. The Board ofBiffa has not received a proposal from any third party at this stage nor canthere be any certainty that a formal offer will ultimately be forthcoming fromany of them. On this basis, the Board of Biffa has decided to recommend theAcquisition. The price of 350 pence per Biffa Share offered by Bidco represents a 34.4 percent. premium to the Closing Price on 22 November 2007 and a 42.9 per cent.premium to the average Closing Price for the three month period to 22 November2007. In light of these premia, the Board of Biffa believes that the price of350 pence per Biffa Share takes proper account of Biffa's leading marketposition within the UK waste management industry and its future prospects, andrepresents an excellent opportunity for Biffa Shareholders to realise anattractive valuation in cash for their Biffa Shares. 5 Recommendation The Biffa Directors, who have been so advised by Citi, JPMorgan Cazenove andTricorn Partners, consider the terms of the Acquisition to be fair andreasonable, so far as Biffa Shareholders are concerned. In providing theiradvice to the Biffa Directors, Citi, JPMorgan Cazenove and Tricorn Partners havetaken into account the Biffa Directors' commercial assessments. The Biffa Directors consider the terms of the Acquisition to be in the bestinterests of Biffa Shareholders as a whole and accordingly have unanimouslyagreed to recommend that Biffa Shareholders vote in favour of the specialresolution relating to the Acquisition to be proposed at the EGM and vote infavour of the Scheme at the Court Meeting, as they have irrevocably undertakento do in respect of their own beneficial holdings, amounting in aggregate to308,580 Biffa Shares, representing approximately 0.09 per cent. of the existingissued share capital of Biffa. Further details of these arrangements are set outin Appendix III to this announcement. Although Citi and JPMorgan Cazenove are acting as lead financial advisers toBiffa, they have an existing relationship with a potential competing offeror forBiffa. Tricorn Partners is therefore acting as the independent financial adviserto Biffa for the purposes of providing independent advice to the Biffa Directorson the Acquisition under Rule 3 of the City Code. 6 Management and employees Bidco attaches great importance to the skills and experience of the existingmanagement and employees of Biffa. Bidco confirms that the existing employmentrights of all employees of Biffa, including pension rights, will be fullysafeguarded. Further, Bidco has no current intention to change the major locations of Biffa'splaces of business and no proposals currently exist to change the conditions ofemployment of any of Biffa's employees. 7 Pensions Bidco has been in discussions with the trustee of the Biffa Pension Scheme andagreement has been reached on a funding and security package which is acceptableto the trustee of the Biffa Pension Scheme. 8 Biffa Share Schemes Participants in the Biffa Share Schemes will be sent letters explaining theeffect of the Acquisition on their rights under each scheme and appropriateproposals will be made to such participants in due course. Options may be exercised and awards will vest under the Biffa Share Schemes asprovided for in the rules of these schemes. Awards under the Biffa Long Term Incentive Plan will vest on the date on whichthe Court Order sanctioning the Scheme is granted, to the extent that therelevant performance targets have been met and the remuneration committee willwaive time pro-rating if it considers there will be satisfactory performance forthe year ended 28 March 2008. Biffa Shares will be transferred to vested awardholders immediately after the Court Order sanctioning the Scheme is granted. Options under the Biffa Sharesave Scheme will be exercisable during the sixmonth period from the date on which the Court Order sanctioning the Scheme isgranted, to the extent of participants' accrued savings and interest under thelinked savings arrangements. To the extent that they are held by Biffa employees, options under the SevernTrent Sharesave Scheme will be exercisable during the six month period from theEffective Date, to the extent of participants' accrued savings and interestunder the linked savings arrangements provided the Scheme becomes effectivepursuant to its terms. Bidco and Biffa have agreed that Biffa will offer compensation to participantsin the Biffa Share Schemes which Bidco believes is significantly higher than thelevel of compensation (if any) that is typically offered in such circumstances. As a result of the Scheme, optionholders under the Biffa Sharesave Scheme andthe Severn Trent Sharesave Scheme will lose part of their options and theexercise of their options may be subject to income tax. These optionholders willbe compensated on a grossed-up basis for the gain that they would have realisedon the lost part of their options and for the approximate amount of tax that ispayable on the exercise of their options. Such compensation payments will beconditional on, in the case of the Biffa Sharesave Scheme, optionholdersexercising their options prior to and conditional on the grant of the CourtOrder sanctioning the Scheme; and in the case of the Severn Trent SharesaveScheme optionholders exercising their options at the end of the six-month periodfrom the Effective Date. The Scheme will extend to any Biffa Shares which are unconditionally allottedand issued and fully paid prior to the Scheme Record Time to satisfy theexercise of options and vesting of awards under the Biffa Share Schemes, but theScheme will not extend to any Biffa Shares allotted or issued at any time on orafter the Scheme Record Time. By virtue of the new article which is proposed tobe inserted into Biffa's Articles, Biffa Shares issued after the Scheme RecordTime, if any, will be automatically transferred to Bidco and/or its nominee(s)in return for the same consideration as Biffa Shareholders are entitled toreceive under the Scheme. Participants in the Biffa Share Incentive Plan will receive the sameconsideration under the Scheme as other Scheme Shareholders and will becompensated on a grossed-up basis for the approximate loss of any tax advantagerelating to their shares in this plan. Biffa employees who participate in the Severn Trent Share Incentive Plan will,in respect of their Biffa Shares, receive the same consideration under theScheme as other Scheme Shareholders for their Biffa Shares. No further grants will be made to Biffa employees under the Biffa Share Schemesbefore the Scheme Hearing, nor thereafter, provided the Scheme becomes effectivein accordance with its terms. 9 Information on Biffa Biffa is a leading UK integrated waste management business. Biffa operatesacross the breadth of the waste management value chain providing wastecollection, treatment and recycling, and disposal services to both local andnational customers in the industrial, commercial and municipal sectors. Further, Biffa: - is a leader in Industrial & Commercial collection with over 450national customers and around 75,000 local customers; - is one of the largest Landfill and Resource Recovery operators with 33landfill sites and 42 treatment and recycling centres across the UK; - has proven experience in developing alternative treatment and disposaltechnologies including energy from waste and mechanical and biologicaltreatment; and - has an established presence in the private finance initiative market. In the financial year ended 30 March 2007, Biffa's revenue and operating profitwere £742.7 million and £90.7 million, respectively. In the 26 week period ended28 September 2007 Biffa's revenue and operating profit were £395.0 million and£52.4 million respectively. 10 Information on Bidco, Montagu Private Equity, GIP andUCIL (a) Bidco Bidco is a limited liability company incorporated in England and Wales for thepurpose of making the Acquisition and is backed by the Montagu Funds, the GIPFunds and UCIL. Bidco is owned by a newly established limited liabilitypartnership (Wasteinvestments LLP) whose limited partnership interests are heldby: (i) various entities within the Montagu Funds; (ii) various entities within the GIP Funds; and (iii) UCIL. The directors of Bidco are Heidi Bryson and Raj Rao. Heidi Bryson is anappointee of Montagu Private Equity and Raj Rao is an appointee of GIP. Subject to any third party investment as described in paragraph 14 below,immediately following the Scheme becoming effective, the ordinary shares ofBidco will ultimately be held as to 43 per cent. by the Montagu Funds, 43 percent. by the GIP Funds and 14 per cent. by UCIL. The Bidco Group is being financed by approximately £306 million to be subscribedby the Montagu Funds, approximately £306 million to be subscribed by the GIPFunds and approximately £100 million to be subscribed by UCIL. In addition,£1,090 million will be provided under a bank facility from a consortium of thefollowing banks: Bank of Scotland Corporate; Barclays Capital, the investmentbanking division of Barclays Bank PLC; Credit Suisse, London Branch; HSBC Bankplc and The Royal Bank of Scotland plc. Please see paragraph 13 of thisannouncement for further information on the financing of the Acquisition. Bidco has not traded since its date of incorporation, nor has it entered intoany obligations, other than in connection with the implementation of theAcquisition. Further information on the Bidco Group will be set out in theScheme Document. (b) Montagu Private Equity Montagu Private Equity (which is authorised and regulated by the FinancialServices Authority) is an independent mid-market arranger of private equityfinance to European companies with over €3 billion of funds and assets undermanagement. It has offices in the UK, France and Germany and a representativeoffice in Sweden. Originally established in 1968 as a subsidiary of the Midland Bank, MontaguPrivate Equity was spun out of the HSBC Group in March 2003, when its managementacquired an 80.1 per cent. interest, leaving HSBC with a minority interest of19.9 per cent. Montagu Private Equity manages the Montagu Funds on a discretionary basis(subject to certain prescribed restrictions). The Montagu Funds comprise a corelimited partnership, Montagu III LP (which is the principal Montagu Fundinvesting in Bidco), and a series of parallel partnership vehicles, which investpro-rata in each of Montagu Private Equity's investments. As at the date of this announcement, the commitments of the investors in theMontagu Funds available for new investments are approximately €2,261 million ofwhich approximately 42 per cent. has been drawn. The investors in the MontaguFunds comprise UK and overseas institutional investors, such as pension fundsand insurance groups, private companies and private investors. In addition,partners, executives and professional staff of Montagu Private Equityparticipate in investments via the Montagu Funds. Montagu Private Equity has appointed Heidi Bryson as a director of each memberof the Bidco Group, including Bidco. (c) Global Infrastructure Partners GIP is a private equity fund which was established in 2006 to invest ininfrastructure assets and businesses in countries which are part of both theOrganisation for Economic Co-operation and Development as well as selectedemerging market countries. GIP targets investments in single assets, portfoliosof assets and operating businesses in the energy, transportation and water andwaste sectors, including power generation and transmission, natural gas storageand pipelines, waste, water, airports, sea ports and railroads. GIP's investmentprofessionals are based in New York, London and Hong Kong. GIP's total committed capital is currently approximately $4.1 billion, of whichapproximately 17 per cent. has been drawn. The investors in the GIP Fundscomprise institutional investors in North America, Europe, the Middle East andAsia, such as pension funds, insurance companies, sovereign wealth funds,financial institutions and high net worth individuals. Recent acquisitions by GIP include the following: • London City Airport, with an affiliate of American InternationalGroup; • a controlling interest in International Trade Logistics, aprivately-developed and owned container port and logistics business in BuenosAires, Argentina, in partnership with an affiliate of Port of SingaporeAuthority; • International Port Holdings Limited, a company which owns the rightsto operate and develop the port at Great Yarmouth in the UK; and • a controlling interest in East India Petroleum Limited, a petroleumliquids storage facility in India. Global Infrastructure Management LLC ("GIM") manages the GIP Funds on adiscretionary basis (subject to certain prescribed restrictions). The GIP Fundscomprise of several parallel funds which invest side by side on a pro-ratabasis. GIP has appointed Raj Rao as a director of each member of the Bidco Group,including Bidco. (d) UCIL UCIL was incorporated as a limited company in Scotland on 20 June 2005 and isultimately a wholly-owned subsidiary of HBOS. HBOS was formed from the merger ofHalifax Group plc and The Governor and Company of the Bank of Scotland inSeptember 2001 and is a diversified financial services company providing,amongst other things, corporate and treasury services in addition to retailbanking services to consumers and companies in the UK and overseas. UCIL operates as a holding company for investments arranged by Bank ofScotland's Fund Investments team, a part of Bank of Scotland's Corporatedivision within HBOS. The investments are made for HBOS's own account in a broadrange of business sectors and geographies, in transactions controlled by privateequity sponsors. Recent transactions by UCIL include the following investments: • approximately £13.5 million to fund the circa. £260 million offer bySandpiper Bidco Limited in July 2007 for C.I. Traders Limited, a Jersey companywhich was then listed on AIM; and • approximately £2.1 million to fund the circa. £53 million offer by2E2 Limited in March 2007 for Compel Group, which was then listed on AIM. Bank of Scotland is both an active investor in and lender to the private equitymarket. The Fund Investments team is engaged in the business of making limitedpartner commitments to private equity funds, making co-investments alongsideprivate equity sponsors, and providing additional debt facilities to privateequity market participants. The Fund Investments team has committed over £380million in a total of 19 co-investments. 11 Current trading and prospects of Biffa Biffa is today publishing its second Interim Management Statement as required bythe UK Listing Authority's Disclosure and Transparency Rules. The material events which have affected Biffa have been the subject ofannouncements made by Biffa on 19 December 2007, 24 January 2008 and 8 February2008. In the period from 29 September 2007 (the start of the second half of Biffa'sfinancial year) to 25 January 2008, the most recent date to which figures areavailable, the Biffa Group as a whole has continued to make good progress.However, as experienced in the first half of Biffa's financial year, the balanceof profits, compared to last year, is expected to be more weighted towardsResource Recovery and Landfill and Power Generation rather than Collection. Net debt at 25 January 2008 stood at £346.3 million. 12 Irrevocable undertakings Bidco has received irrevocable undertakings to vote in favour of the Acquisitionand the resolutions to be proposed: • at the Court Meeting from each of the Biffa Directors who hold BiffaShares, in respect of, in aggregate, 308,580 Biffa Shares, representingapproximately 0.09 per cent. of the existing issued share capital of Biffa; and • at the EGM from each of the Biffa Directors who hold Biffa Shares andWastebidco in respect of, in aggregate, 8,860,146 Biffa Shares, representingapproximately 2.53 per cent. of the existing issued share capital of Biffa. These undertakings are in respect of the Biffa Directors' and Wastebidco'saggregate entire beneficial holdings of Biffa Shares. These undertakings willcease to have any effect if the Scheme Document (or, if relevant, Offerdocument) is not posted within 28 days of the date of this announcement, theScheme fails or is withdrawn (or, if the Acquisition is implemented by way ofthe Offer, the Offer lapses or is withdrawn) or, in the case of the irrevocableundertakings given by the Biffa Directors, if the Implementation Agreementterminates. The consortium formed by Montagu Private Equity and HgCapital had established anacquisition vehicle named Wastebidco, owned by the Montagu Funds, funds managedby or advised by HgCapital and UCIL (which holds a passive interest) for thepurposes of its proposal and Wastebidco had (prior to HgCapital's withdrawal)acquired 8,551,566 Biffa Shares, representing approximately 2.44 per cent. ofthe existing issued share capital of Biffa. Wastebidco continues to hold theseshares and has signed an irrevocable undertaking to vote in favour of theAcquisition and the resolution to be proposed at the EGM in respect of its BiffaShares. As it is a connected party, it will not be entitled to vote at the CourtMeeting but will undertake to be bound by the provisions of the Scheme. Thisundertaking will cease to have any effect if the Scheme fails or is withdrawn(or, if the Acquisition is implemented by way of the Offer, the Offer lapses oris withdrawn). Further details of these arrangements are set out in Appendix III to thisannouncement. 13 Financing of the Acquisition The consideration payable under the Acquisition will be financed through acombination of equity and debt financing. The equity financing will be providedby the Montagu Funds, the GIP Funds and UCIL and the debt financing, consistingof facilities of £1,090 million, has been arranged and fully underwritten by aconsortium of the following banks: Bank of Scotland Corporate; Barclays Capital,the investment banking division of Barclays Bank PLC; Credit Suisse, LondonBranch; HSBC Bank plc and The Royal Bank of Scotland plc. Further details on thefinancing of the Acquisition will be set out in the Scheme Document. Deutsche Bank, Merrill Lynch and UBS confirm that they are satisfied thatsufficient resources are available to Bidco to satisfy full acceptance of theAcquisition in cash. 14 Third party investors Bidco is ultimately owned by a newly established limited liability partnership(Wasteinvestments LLP) in which the Montagu Funds, the GIP Funds and UCIL willinvest. Montagu Private Equity and Global Infrastructure Partners intend,during the course of the Acquisition, to seek third parties to invest inWasteinvestments LLP and thereby indirectly in Bidco alongside the members ofthe Bidco Consortium. Most sums to be invested by third parties are likely tocome from existing investors in the Montagu Funds or the GIP Funds, although itis possible that some funds may come from other third parties. However, MontaguPrivate Equity (through the Montagu Funds) and Global Infrastructure Partners(through the GIP Funds) intend to retain control over more than 50 per cent. ofWasteinvestments LLP's limited partnership interests when the Scheme becomeseffective. The maximum amount of Wasteinvestments LLP's limited partnership interests (andthereby Bidco's equity) that could be allocated to the control of any thirdparty investors equates to approximately 40 per cent. of Wasteinvestments LLP'slimited partnership interests at the time the Scheme becomes effective. 15 Structure of the Acquisition It is intended that the Acquisition will be effected by means of a Courtsanctioned scheme of arrangement between Biffa and the Scheme Shareholders underthe Companies Acts. This procedure involves an application by Biffa to the Courtto sanction the Scheme and to confirm the cancellation of the Scheme Shares(other than Loan Note Elected Shares). Scheme Shareholders on Biffa's registerof members at the Scheme Record Time will receive cash or Loan Notes on thebasis described in paragraph 2 above. The Scheme will result in Biffa becoming awholly-owned subsidiary of Bidco. The implementation of the Scheme will be subject to the Conditions and certainfurther terms referred to in Appendix I to this announcement and to be set outin the Scheme Document. To become effective, the Scheme requires, amongst otherthings, the following events to occur: • a resolution to approve the Scheme is passed by a majority in numberof the Scheme Shareholders present, entitled to vote and voting at the CourtMeeting (or at any adjournment thereof), either in person or by proxy,representing not less than seventy-five per cent. in value of the shares votedat the Court Meeting (or at any adjournment thereof); • the special resolution to implement the Scheme is passed at the EGM;and • the Scheme is sanctioned and the associated Capital Reductionconfirmed by the Court and office copies of the Court Orders are delivered tothe Registrar and, in the case of the Capital Reduction, such Court Ordertogether with the minute of the Capital Reduction is registered by theRegistrar. Upon the Scheme becoming effective, it will be binding on all BiffaShareholders, irrespective of whether or not they attended or voted at the CourtMeeting or the EGM (and if they attended and voted, whether or not they voted infavour). Further details of the Scheme will be contained in the Scheme Document, whichwill be posted to Biffa Shareholders as soon as practicable. 16 Loan Note Alternative Up to a maximum amount of £150,000,000 of Loan Notes in aggregate nominal valuewill be available under the Loan Note Alternative. To the extent that BiffaShareholders validly elect to receive Loan Notes pursuant to the Loan NoteAlternative which in aggregate nominal value exceed such amount, the entitlementof each Biffa Shareholder who so validly elects will be scaled down pro rata tothe number of Biffa Shares in respect of which he has elected for the Loan NoteAlternative. The Loan Notes will be issued by Bidco, credited as fully paid, in amounts andintegral multiples of £1 and the balance of any entitlement that is not a wholemultiple of £1 will be disregarded and not issued. The Loan Notes are intendedto be Non-Qualifying Corporate Bonds and will constitute direct, unsecured andunsubordinated obligations of Bidco. The Loan Notes will be guaranteed as toprincipal and interest for one Interest Period only by HSBC or such alternativeguarantor substituted in accordance with the terms of the Loan Note Instrument.The Loan Notes will bear interest at a rate of 0.75 per cent. below six-monthsterling LIBOR to be determined on the first Business Day of each InterestPeriod. Interest will be payable by half-yearly instalments in arrears (less anytax) on each Interest Payment Date in respect of the relevant Interest Period.The first payment of interest will be made on the First Interest Payment Date.On the First Interest Payment Date, interest will be paid in respect of theperiod from (and including) the date of issue of the relevant Loan Notes to (butexcluding) the First Interest Calculation Date. The Loan Notes will beredeemable, on not less than 20 Business Days' prior written notice to expire onthe First Interest Calculation Date or any subsequent Interest Calculation Date,in whole or in part (in a minimum amount of £100 and in integral multiples of£100 or, if less, the remaining principal amount of the Loan Notes owned by thatNoteholder) for cash at par, together with any interest accrued thereon (subjectto any deduction or withholding required by law), at the option of theNoteholders and in the event of such notice such reduction monies will be repaidon the Interest Payment Date next following the expiry of such notice. Unless Bidco decides otherwise, no Loan Notes will be issued by Bidco unless, onor before the Effective Date, the aggregate nominal value of all Loan Notes tobe issued as a result of valid elections for the Loan Note Alternative exceeds£10,000,000. If such aggregate nominal value is less than £10,000,000, any suchelection shall, unless Bidco decides otherwise, be void and the relevant BiffaShareholders will be deemed to have elected for cash. Bidco may redeem all (butnot some only) of the Loan Notes (so long as they have been in issue for atleast 6 months) if (i) the aggregate nominal value of the Loan Notes in issuefalls below £10,000,000; or (ii) there remains in issue no more than 10 percent. of the principal amount of the Loan Notes issued to those Noteholders whohad validly elected to take up the Loan Note Alternative. If not previouslyredeemed, the Loan Notes will be redeemed on the Redemption Date. Any Loan Notesoutstanding on the Redemption Date will be redeemed at par together with anyaccrued interest (subject to any deduction or withholding required by law) onthat date. The Loan Notes will not be transferable save to Permitted Transfereesand no application will be made for them to be listed on, or dealt on, any stockexchange or other trading facility. Loan Notes that may be issued pursuant to the Acquisition have not been and willnot be registered under the US Securities Act or under the relevant securitieslaws of any state or territory or other jurisdiction of the United States.Accordingly, Loan Notes may not be offered or sold in the United States, exceptin a transaction not subject to, or in reliance on, an exemption from theregistration requirements of the US Securities Act and state securities laws. Unless Bidco otherwise determines, the relevant clearances and registrationshave not been, nor will they be, sought or obtained, nor have any steps beentaken, nor will any steps be taken, to enable the Loan Notes to be publiclyoffered in compliance with applicable securities laws of the United States,Australia, Canada, Japan or New Zealand (or any province or territory thereof,if applicable) or any other jurisdiction. Accordingly, the Loan Notes (subjectto certain exceptions) may not be offered, sold, resold, transferred, ordelivered, directly or indirectly, in, into or from, the United States,Australia, Canada, Japan or New Zealand or any other jurisdiction where to do sowould violate the laws of that jurisdiction or would require registrationthereof in such jurisdiction. The Loan Note Alternative will be conditional upon the Scheme becoming effectiveand will remain open for election until the Loan Note Deadline. The Loan Notes and the Loan Note Instrument will be governed by, and construedin accordance with, English law and will be unsecured obligations of Bidco,ranking pari passu with its other unsecured obligations apart from those whichare preferred by any insolvency or other similar law or any law relating tocreditors' rights generally. Further details of the Loan Notes and the Loan Note Alternative will becontained in the Scheme Document. 17 Non-Solicitation and Inducement Fee Agreement Biffa has agreed to pay Bidco an inducement fee equal to one per cent. of thetotal consideration payable for the Biffa Shares (on a fully diluted basis)being equivalent to approximately £12.31 million (inclusive of any value addedtax payable, except to the extent that any such value added tax is recoverableby Biffa) if: (i) the Board of Biffa withdraws, or adversely modifies orqualifies its recommendation of the Acquisition, and the Scheme or Offer (as thecase may be) does not succeed; or (ii) a Third Party Transaction is subsequently announced whichultimately is successful. The Board of Biffa and its lead financial advisers, Citi and JPMorgan Cazenove,consider the inducement fee and the circumstances in which it may become payableto be in the best interests of Biffa and Biffa Shareholders. 18 Implementation Agreement Biffa and Bidco have entered into the Implementation Agreement which provides,inter alia, for the implementation of the Scheme in accordance with an agreedindicative timetable and related matters and contains certain assurances andconfirmations between the parties, including provisions to implement the Schemeon a timely basis and governing the conduct of the business of the Biffa Group. The Implementation Agreement terminates in certain circumstances, including: • upon notice from Bidco to Biffa following a material breach by Biffaof certain of its obligations relating to the conduct of its business; or • upon notice from one party to the other, if the Biffa Directors do notrecommend the Scheme or such recommendation is withdrawn, modified or qualified;or • upon notice from Bidco to Biffa, following the announcement andsuccessful completion of a Third Party Transaction; or • if the Court declines or refuses to sanction the Scheme, or the CourtOrder sanctioning the Scheme is not granted, or any resolutions required toapprove and implement the Scheme at the EGM or at the Court Meeting are notpassed; or • upon notice from one party to the other, if at any time after theapproval of the Scheme by the Scheme Shareholders at the Court Meeting butbefore the grant of the Court Order, the Biffa Directors, in exercise of theirfiduciary duties, decides not to proceed with the Scheme. Further, Biffa has undertaken to not (directly or indirectly) solicit approachesfrom any persons in respect of or in connection with a Third Party Transaction. 19 Delisting and re-registration Prior to the Scheme becoming effective, and subject to applicable requirementsof the London Stock Exchange and the Financial Services Authority, Biffa willapply to the London Stock Exchange for the Biffa Shares to cease to be admittedto trading and to the Financial Services Authority for the listing of BiffaShares to be cancelled from the Official List, in each case to take effect onthe next Business Day following the Effective Date. Subject to the Scheme becoming effective, share certificates in respect of BiffaShares will cease to be valid on the Effective Date and should be destroyed. Inaddition, on the Effective Date, entitlements to Biffa Shares held within theCREST system will be cancelled. It is also proposed that, following theEffective Date and after its shares are delisted, Biffa will be re-registered asa private limited company. 20 Disclosure of interests in Biffa As at the close of business on 6 February 2008, being the latest practicabledate prior to this announcement, save as disclosed below, neither Bidco (nor anyof its directors) nor any other member of the Bidco Group, nor, so far as Bidcois aware and save as described below, any person deemed by the Panel to beacting in concert with Bidco, owns or controls any Biffa Shares or anysecurities convertible or exchangeable into Biffa Shares (including pursuant toany long exposure, whether conditional or absolute, to changes in the prices ofsecurities) or any rights to subscribe for or purchase the same, or holds anyoptions (including traded options) in respect of, or has any option to acquire,any Biffa Shares or has entered into any derivatives referenced to, Biffa Shares("Relevant Biffa Securities") which remain outstanding, nor does any such personhold any short positions in relation to Relevant Biffa Securities (whetherconditional or absolute and whether in the money or otherwise), including anyshort position under a derivative, any agreement to sell or any deliveryobligation or right to require another person to purchase or take delivery, nordoes any such person have any arrangement in relation to Relevant BiffaSecurities. An "arrangement" also includes any indemnity or option arrangementand any agreement or understanding, formal or informal, of whatever nature,relating to Relevant Biffa Securities which may be an inducement to deal orrefrain from dealing in such securities. As at the close of business on 6 February 2008, being the latest practicabledate prior to this announcement: (i) members of the Montagu Private Equity group(including the Montagu Funds and all their portfolio companies deemed to beacting in concert with Bidco) and their respective directors (together withtheir close relatives and related trusts) were interested in a total of 127,266Biffa Shares (excluding the Montagu Funds' interest in the Biffa Shares held byWastebidco), representing approximately 0.036 per cent. of the existing issuedshare capital of Biffa; (ii) members of the HBOS Group were interested in a total of 3,781,922Biffa Shares (excluding any non-discretionary interests and UCIL's interest inthe Biffa Shares held by Wastebidco), representing approximately 1.081 per cent.of the existing issued share capital of Biffa; (iii) members of the Deutsche Bank group were interested in a total of468,600 Biffa Shares, representing approximately 0.134 per cent. of the existingissued share capital of Biffa; (iv) members of the Merrill Lynch group were interested in a total of60,000 Biffa Shares, representing approximately 0.017 per cent. of the existingissued share capital of Biffa; and (v) Wastebidco was interested in a total of 8,551,566 Biffa Shares,representing approximately 2.44 per cent. of the existing issued share capitalof Biffa. It has not been possible, prior to this announcement, to ascertain all of theinterests (if more than the interests disclosed in this announcement) of suchrelevant persons in Biffa Shares. Any such additional interest(s) will bediscussed with the Panel and, if appropriate, will be disclosed to BiffaShareholders in the Scheme Document. 21 Overseas Shareholders The availability of the Acquisition to Biffa Shareholders who are not residentin the United Kingdom may be affected by the laws of the relevant jurisdictionsin which they are located. Persons who are not resident in the United Kingdomshould inform themselves about, and observe, applicable legal or regulatoryrequirements in their jurisdiction. The Loan Note Alternative will not be available to Restricted Overseas Persons.Such persons will only be entitled to receive cash consideration and will not beeligible to elect to receive Loan Notes as consideration pursuant to the LoanNote Alternative. 22 General The Acquisition will be made subject to the Conditions and on the termscontained in Appendix I to this announcement and on the further terms andconditions to be set out or referred to in the Scheme Document. The Scheme willbe governed by English law and subject to the applicable rules and regulationsof the London Stock Exchange, the City Code, the Panel and the FinancialServices Authority. Appendix I to this announcement contains the Conditions and certain furtherterms of the Acquisition. Appendix II to this announcement contains details ofthe bases of calculations and sources of the financial information set out inthis announcement. Appendix III to this announcement contains details of theirrevocable undertakings that have been provided to Bidco. Appendix IV to thisannouncement contains definitions of certain expressions used in thisannouncement. The Scheme Document, together with the Forms of Proxy and (where applicable) theForm of Election, will be posted to Biffa Shareholders as soon as practicable. Press enquiries For further information contact:BidcoJason Gatenby Tel: 020 7336 9955Matthew Harris Tel: 020 7883 3100 UBS Investment Bank Tel: 020 7567 8000(Joint financial adviser and broker to Bidco)Liam BeereJackie Lee Deutsche Bank Tel: 020 7545 8000(Joint financial adviser and broker to Bidco)Alan BrownRick HenryAlexis Maskell Merrill Lynch Tel: 020 7628 1000(Joint financial adviser and broker to Bidco)Kevin J SmithKarl Lim PricewaterhouseCoopers LLP Tel: 020 7583 5000(Joint financial adviser to Bidco)Malcolm WrenJon Raggett Maitland Tel: 020 7379 5151(Public relations adviser to Bidco)Peter Ogden Financial Dynamics Tel: 020 7831 3113(Public relations adviser to Bidco)Paul MarriottEdward Berry BiffaMartin Bettington Tel: 01494 556 400 (Chief Executive Officer) Citi Tel: 020 7986 4000(Joint financial adviser and broker to Biffa)Simon LindsayMark ToddCharles Lytle JPMorgan Cazenove Tel: 020 7588 2828(Joint financial adviser and broker to Biffa)Robert ConstantBarry Weir Tricorn Partners Tel: 020 7823 0888(Rule 3 adviser to Biffa)Justin Dowley Tulchan Tel: 020 7353 4200(Public relations adviser to Biffa)David TrenchardDavid AllchurchStephen Malthouse This announcement is not intended to and does not constitute, or form any partof, an offer to sell or an invitation to subscribe for or purchase anysecurities or the solicitation of any vote or approval in any jurisdictionpursuant to the Acquisition or otherwise. The Acquisition will be made solelythrough the Scheme Document, which will contain the full terms and conditions ofthe Acquisition (including details on how to vote in respect of theAcquisition). Any response in relation to the Acquisition should be made only onthe basis of the information contained in the Scheme Document or any otherdocument by which the Acquisition is made. Biffa Shareholders are advised toread carefully the formal documentation in relation to the Acquisition once ithas been despatched. This announcement does not constitute a prospectus orprospectus equivalent document. UBS is acting exclusively for Bidco and for no one else in connection with theAcquisition and will not regard any other person as its client nor beresponsible to anyone other than Bidco for providing the protections afforded toclients of UBS, nor for providing advice in relation to the Acquisition, thecontents of this announcement or any matter referred to herein. Deutsche Bank is authorised under German banking law (competent authority: BaFin- Federal Financial Supervising Authority) and regulated by the FinancialServices Authority for the conduct of UK business. Deutsche Bank is acting forBidco and no one else in connection with the Acquisition and will not beresponsible to anyone other than Bidco for providing the protections afforded toclients of Deutsche Bank, nor for providing advice in relation to theAcquisition, the contents of this announcement or any matter referred to herein. Merrill Lynch, which is authorised and regulated in the United Kingdom by theFinancial Services Authority, is acting exclusively for Bidco and no one else inconnection with the Acquisition and will not be responsible to anyone other thanBidco for providing the protections afforded to clients of Merrill Lynch, norfor providing advice in relation to the Acquisition, the contents of thisannouncement or any matter referred to herein and the accompanying documents. PricewaterhouseCoopers LLP, which is authorised and regulated in the UnitedKingdom by the Financial Services Authority, is acting exclusively for Bidco andno one else in connection with the Acquisition and will not be responsible toanyone other than Bidco for providing the protections afforded to clients ofPricewaterhouseCoopers LLP or for giving advice in relation to the Acquisitionor any other matter referred to in this announcement. Citi, which is authorised and regulated in the United Kingdom by the FinancialServices Authority, is acting for Biffa and for no one else in relation to theAcquisition and will not be responsible to anyone other than Biffa for providingthe protections afforded to clients of Citi, nor for providing advice inrelation to the Acquisition, the contents of this announcement or any othermatter referred to herein. JPMorgan Cazenove, which is authorised and regulated in the United Kingdom bythe Financial Services Authority, is acting exclusively for Biffa and for no oneelse in relation to the Acquisition and will not regard any other person as itsclient nor be responsible to anyone other than Biffa for providing theprotections afforded to clients of JPMorgan Cazenove, nor for providing advicein relation to the Acquisition, the contents of this announcement or any othermatter referred to herein. Tricorn Partners LLP, which is authorised and regulated in the United Kingdom bythe Financial Services Authority, is acting exclusively for Biffa and no oneelse in connection with the Acquisition and this announcement and will not beresponsible to anyone other than Biffa for providing the protections afforded toclients of Tricorn Partners LLP nor for providing advice in connection with theAcquisition or this announcement or any matter referred to herein. Overseas persons The release, publication or distribution of this announcement in or intojurisdictions other than the United Kingdom may be restricted by law andtherefore persons into whose possession this announcement comes should informthemselves about, and observe, any applicable restrictions. Any failure tocomply with such restrictions may constitute a violation of the securities lawsof any such jurisdiction. This announcement has been prepared for the purpose ofcomplying with English law and the City Code and the information disclosed maynot be the same as that which would have been disclosed if this announcement hadbeen prepared in accordance with the laws of jurisdictions outside the UnitedKingdom. The Loan Notes that may be issued pursuant to the Acquisition have not been andwill not be registered under the US Securities Act or under the relevantsecurities laws of any state or territory or other jurisdiction of the UnitedStates. Accordingly, Loan Notes may not be offered or sold in the United States,except in a transaction not subject to, or in reliance on an exemption from, theregistration requirements of the US Securities Act and such state securitieslaws. Any Loan Notes which may be issued pursuant to the Acquisition have not been andwill not be registered under the relevant securities laws of Japan and anyrelevant clearances and registrations have not been, and will not be, obtainedfrom the securities commission of any province of Canada. No prospectus inrelation to the Loan Notes has been, or will be, lodged with, or registeredwith, the Australian Securities and Investments Commission, the JapaneseMinistry of Finance or the New Zealand Companies Office. Accordingly, unlessotherwise determined by Bidco and permitted by applicable law and regulation,the Loan Notes may not be offered, sold, resold, transferred, delivered ordistributed, directly or indirectly in or into Australia, Canada, Japan or NewZealand or any other jurisdiction where to do so would violate the laws of thatjurisdiction or would require registration thereof in such jurisdiction. Shareholders in the United States should note that the Scheme relates to theshares of a UK company and will be governed by English law. Neither the proxysolicitation nor the tender offer rules under the US Securities Exchange Act of1934, as amended, will apply to the Scheme. Moreover, the Scheme will be subjectto the disclosure requirements and practices applicable in the UK to schemes ofarrangement, which differ from the disclosure requirements of the US proxysolicitation rules and tender offer rules. Financial information included inthis announcement and the Scheme documentation has been or will have beenprepared in accordance with accounting standards applicable in the UK that maynot be comparable to financial information of US companies or companies whosefinancial statements are prepared in accordance with generally acceptedaccounting principles in the United States. If Bidco exercises its right toimplement the acquisition of the Biffa Shares by way of the Offer, if made intothe United States, the Offer will be made in compliance with applicable UStender offer and securities laws and regulations. If the Acquisition is carried out by way of the Offer and unless otherwisedetermined by Bidco or required by the City Code, and permitted by applicablelaw and regulation, the Offer will not be made, directly or indirectly, in orinto or from, or by use of the mail, or by any means or instrumentality(including, without limitation, telex, facsimile transmission, telephone,internet or other forms of electronic communication) of interstate or foreigncommerce of, or by any facilities of a national securities exchange of, aRestricted Jurisdiction and the Offer cannot be accepted by any such use, meansor instrumentality or otherwise from or within a Restricted Jurisdiction.Accordingly, copies of this announcement are not being, and must not be, mailedor otherwise forwarded, distributed or sent in or into or from any suchjurisdiction where to do so would constitute a breach of the securities laws inthat jurisdiction. Persons receiving this announcement (including, withoutlimitation, custodians, nominees and trustees) should observe these restrictionsand should not send or distribute this announcement in, into or from any suchjurisdictions. No listing authority or equivalent has reviewed, approved or disapproved of thisannouncement or any of the proposals described herein. Forward looking statements This announcement, including information included or incorporated by referencein this announcement, may contain "forward-looking statements" concerning Biffaand Bidco. Generally, the words "will", "may", "should", "continue", "believes","expects", "intends", "anticipates" or similar expressions identifyforward-looking statements. The forward-looking statements involve risks anduncertainties that could cause actual results to differ materially from thoseexpressed in the forward-looking statements. Many of these risks anduncertainties relate to factors that are beyond the companies' abilities tocontrol or estimate precisely, such as future market conditions and thebehaviours of other market participants, and therefore undue reliance should notbe placed on such statements. Bidco assumes no obligation and does not intend toupdate these forward-looking statements, except as required pursuant toapplicable law. Nothing in this announcement is intended, or is to be construed, as a profitforecast or to be interpreted to mean that earnings per Biffa Share for thecurrent or future financial years, or those of the combined group, willnecessarily match or exceed the historical published earnings per Biffa Share. Dealing disclosure requirements Under the provisions of Rule 8.3 of the City Code, if any person is, or becomes,"interested" (directly or indirectly) in one per cent. or more of any class of "relevant securities" of Biffa, all "dealings" in any "relevant securities" ofBiffa (including by means of an option in respect of, or a derivative referencedto, any such "relevant securities") must be publicly disclosed by no later than3.30 pm (London time) on the Business Day following the date of the relevanttransaction. This requirement will continue until the Effective Date or when the"offer period" otherwise ends. If two or more persons act together pursuant toan agreement or understanding, whether formal or informal, to acquire an "interest" in "relevant securities" of Biffa, they will be deemed to be a singleperson for the purpose of Rule 8.3 of the City Code. Under the provisions of Rule 8.1 of the City Code, all "dealings" in "relevantsecurities" of Biffa by Bidco or by Biffa or by any of their respective "associates" for their own account during an "offer period", must be privatelyand publicly disclosed by no later than 12 noon (London time) on the BusinessDay following the date of the relevant transaction. A disclosure table, giving details of the companies in whose "relevantsecurities" "dealings" should be disclosed, and the number of such securities inissue, can be found on the Panel's website at www.thetakeoverpanel.org.uk. "Interests in securities" arise, in summary, when a person has long economicexposure, whether conditional or absolute, to changes in the price of "relevantsecurities". In particular, a person will be treated as having an "interest" byvirtue of the ownership or control of securities, or by virtue of any option inrespect of, or derivative referenced to, securities. Terms in quotation marks are defined in the City Code, which can also be foundon the Panel's website. If you are in any doubt as to whether or not you arerequired to disclose a "dealing" under Rule 8 of the City Code, you shouldcontact an independent financial adviser authorised under the Financial Servicesand Markets Act 2000 or consult the Panel's website or contact the Panel ontelephone number +44 (0) 20 7638 0129. Appendix I: Conditions of the Acquisition The Acquisition will be conditional upon the Scheme becoming unconditional andbecoming effective, subject to the City Code, by not later than 30 September2008 or such later date (if any) as Bidco and Biffa may agree and (if required)the Court may allow. Part A: Conditions to the Scheme 1. The Scheme will be conditional upon: (a) the approval of the Scheme by a majority in numberrepresenting 75 per cent. or more in value of the Biffa Shareholders present,entitled to vote and voting, either in person or by proxy, at the Court Meeting,or at any adjournment thereof; (b) the resolution(s) required to approve and implement theScheme being duly passed by the requisite majority at the EGM, or at anyadjournment thereof; and (c) the sanction (with or without modification, and any suchmodification to be on terms agreed by Bidco and Biffa) of the Scheme andconfirmation of the Capital Reduction by the Court and office copies of theCourt Orders and the minute of such reduction being delivered for registrationto the Registrar and, in relation to the Capital Reduction, being registered bythe Registrar. 2. Biffa and Bidco have agreed that, save as stated in Part B of thisAppendix I, the necessary actions to make the Scheme effective will not be takenunless conditions 1(a) and 1(b) above have been fulfilled and the followingconditions (as amended if appropriate) are satisfied or where relevant waived: (a) insofar as the Acquisition falls within the scope of CouncilRegulation (EC) 139/2004 (the "Regulation"): (i) the European Commission having issued a decision pursuant toArticle 6(1)(b) of the Regulation, or having been deemed to have issued adecision, declaring the Acquisition compatible with the common market; or (ii) the European Commission taking a decision (or being deemed to havetaken a decision) to refer the whole or part of the Acquisition to the competentauthorities of one or more Member States under Article 9(3) of the Regulationand each such authority taking a decision with equivalent effect to paragraph 2(a)(i) above and with respect to any part of the Acquisition retained by theEuropean Commission, the European Commission taking a decision with equivalenteffect to paragraph 2(a)(i) in respect of that part of the Acquisition; (b) (excluding antitrust or merger control clearances in respectof the Acquisition, in relation to which paragraph 2(a) above shall apply) since30 March 2007 and save as Disclosed, no central bank, government orgovernmental, quasi-governmental, supranational, statutory, regulatory,environmental or investigative body, court, trade agency, association,institution or any other body or person whatsoever in any relevant jurisdiction(each a "Third Party") having given notice of a decision to take, institute,implement or threaten any action, proceeding, suit, investigation, enquiry orreference, or having enacted, made or proposed any statute, regulation, decisionor order, or having taken any other steps which would or would reasonably beexpected to: (i) require, prevent or delay the divestiture, or alter the termsenvisaged for any proposed divestiture by any member of the Wider Bidco Group orany member of the Wider Biffa Group of all or any portion of their respectivebusinesses, assets or property or impose any limitation on the ability of any ofthem to conduct their respective businesses (or any of them) or to own any oftheir respective material assets or properties (or any part thereof) which inany such case is material in the context of the Wider Biffa Group taken as awhole; (ii) result in a material delay in the ability of Bidco, or render itunable, to acquire a material portion of the Biffa Shares or require adivestiture by Bidco or any member of the Wider Bidco Group of a material numberof shares in Biffa; (iii) impose any material limitation on, or result in a material delayin, the ability of any member of the Wider Bidco Group, directly or indirectly,to acquire or to hold or to exercise effectively any rights of ownership inrespect of shares or loans or securities convertible into shares or any othersecurities (or the equivalent) in any member of the Wider Biffa Group or theability of any member of the Wider Biffa Group or Bidco to hold or exerciseeffectively any rights of ownership of shares, loans or other securities, whichis material in the context of the Wider Biffa Group, or to exercise managementcontrol over any member of the Wider Biffa Group; (iv) make the Acquisition or its implementation or the acquisition orproposed acquisition by Bidco or any member of the Wider Bidco Group of theBiffa Shares void, illegal, and/or unenforceable under the laws of anyjurisdiction, or otherwise, directly or indirectly, restrain, restrict,prohibit, materially delay or otherwise materially interfere with the same, orimpose additional material conditions or obligations with respect thereto, orotherwise materially challenge or interfere therewith; (v) other than in connection with the Acquisition, require any memberof the Wider Bidco Group or the Wider Biffa Group to offer to acquire any sharesor other securities (or the equivalent) or interest in any member of the WiderBiffa Group or the Wider Bidco Group owned by any third party; (vi) impose any limitation that is material in the context of thebusiness of the Wider Biffa Group on the ability of any member of the WiderBidco Group or Wider Biffa Group to coordinate the business of any member of theWider Biffa Group, or any part of it, with the businesses of any other membersof the Wider Bidco Group and/or members of the Wider Biffa Group; (vii) result in any member of the Wider Biffa Group ceasing to be able tocarry on business under any name under which it presently does so; or (viii) otherwise materially adversely affect any or all of the businesses,assets, prospects or profits of any member of the Wider Biffa Group or the WiderBidco Group, and all applicable waiting and other time periods during which any such ThirdParty could institute, implement or threaten any action, proceeding, suit,investigation, enquiry or reference or any other step under the laws of anyjurisdiction in respect of the Scheme or the acquisition or proposed acquisitionof any Biffa Shares having expired, lapsed or been terminated; (c) (excluding antitrust or merger control clearances in respectof the Acquisition, in relation to which paragraph 2(a) above shall apply), allnecessary material notifications and filings have been made in connection withthe Acquisition and all statutory and regulatory obligations in connection withthe Acquisition in any relevant jurisdiction having been complied with and allmaterial authorisations, orders, recognitions, grants, consents, clearances,confirmations, certificates, licences, permission and approvals ("Authorisations") necessary or appropriate in any relevant jurisdiction for, or in respect of,the Acquisition and the acquisition or the proposed acquisition of the BiffaShares by Bidco or any member of the Wider Bidco Group in terms reasonablysatisfactory to Bidco having been obtained from all appropriate Third Parties,all or any applicable waiting and other time periods having expired, lapsed orbeen terminated (as appropriate) and all such Authorisations (together with allmaterial Authorisations necessary or appropriate to carry on the business of anymember of the Wider Biffa Group) remaining in full force and effect at the timeat which the Acquisition becomes otherwise unconditional and there being nonotice of any intention to revoke, suspend, restrict, amend or not to renew anysuch Authorisations; (d) save as Disclosed, there being no provision of anyagreement, arrangement, licence, permit or other instrument to which any memberof the Wider Biffa Group is a party or by or to which any such member or any ofits assets may be bound, entitled or subject, which in consequence of the makingof the Acquisition or the proposed acquisition by Bidco or any member of theWider Bidco Group of any shares or other securities (or the equivalent) in Biffaor because of a change in the control or management of any member of the WiderBiffa Group or otherwise, would or would reasonably be expected to result in (ineach case to an extent which is material in the context of the Wider Biffa Groupas a whole): (i) any monies borrowed by or any other indebtedness (actual orcontingent) of, or grant available to, any member of the Wider Biffa Group beingor becoming repayable or capable of being declared repayable immediately orearlier than their or its stated maturity date or repayment date or the abilityof any such member to borrow monies or incur any indebtedness being withdrawn orinhibited or adversely affected or being capable of becoming or being withdrawnor inhibited or adversely affected; (ii) any such agreement, arrangement, licence, permit or instrument orthe rights, liabilities, obligations or interests of any member of the WiderBiffa Group thereunder being terminated or adversely modified or affected or anyobligation or liability arising or any action being taken thereunder; (iii) (other than in the ordinary course of business) any assets orinterests of any member of the Wider Biffa Group being or falling to be disposedof or any assets or interests of any such member being or falling to be chargedor any right arising under which any such asset or interest could be required tobe disposed of or charged; (iv) the creation or enforcement of any mortgage, charge or othersecurity interest over the whole or any part of the business, property or assetsof any member of the Wider Biffa Group or any such security (whenever arising)becoming enforceable; (v) the rights, liabilities, obligations or interests of any member ofthe Wider Biffa Group in, or the business of any such member with, any person,firm or body (or any arrangement or arrangements relating to any such interestor business) being terminated, materially adversely modified or affected; (vi) the value of any member of the Wider Biffa Group or its financialor trading position, profits or prospects being prejudiced or adverselyaffected; (vii) any member of the Wider Biffa Group ceasing to be able to carry onbusiness under any name under which it presently does so; or (viii) (other than in the ordinary course of business) the creation of anyliability (actual or contingent) by any member of the Wider Biffa Group, and no event having occurred which, under any provision of any agreement,arrangement, licence, permit or other instrument to which any member of theWider Biffa Group is a party or by which any such member or all or any of itsassets may be bound, entitled or subject would or would reasonably be expectedto result in any of the events or circumstances as are referred to insub-paragraphs (i) to (viii) of this paragraph (d) (in each case to an extentwhich is material in the context of the Wider Biffa Group as a whole), except inso far as such event is a consequence of the Acquisition or the proposedacquisition of any share or other securities in Biffa or a change of control ormanagement of Biffa; (e) save as Disclosed, and except in so far as such event is aconsequence of the Acquisition, since 30 March 2007 no member of the Wider BiffaGroup having: (i) save as between Biffa and wholly-owned subsidiaries of Biffa("intra-Biffa Group transactions") and save for Biffa Shares issued pursuant tothe exercise of options granted under the Biffa Share Schemes, issued orauthorised the issue of additional shares of any class or redeemed, purchased orreduced or announced any intention to do so or made any other change to any partof its share capital; (ii) save for intra-Biffa Group transactions and save for the grant ofoptions under the Biffa Share Schemes, issued or agreed to issue or authorisedor agreed to authorise securities convertible into shares of any class orrights, warrants or options to subscribe for, or acquire, any such shares orconvertible securities; (iii) other than lawfully to another member of the Wider Biffa Group,recommended, declared, paid or made or proposed to recommend, declare, pay ormake any bonus, dividend or other distribution whether payable in cash orotherwise; (iv) save for intra-Biffa Group transactions, implemented, effected,authorised or announced its intention to implement, effect, or authorise anymerger, demerger, reconstruction, amalgamation, scheme, commitment oracquisition or disposal of assets or shares (or the equivalent thereof) in anyundertaking or undertakings; (v) save for intra-Biffa Group transactions and other than in theordinary course of business, disposed of, or transferred, mortgaged or createdany security interest over any asset or any right, title or interest in anyasset that is material in the context of the Biffa Group taken as a whole orauthorised, proposed or announced any intention to do so; (vi) save for intra-Biffa Group transactions, made or authorised orannounced an intention to propose any change in its loan capital; (vii) save for intra-Biffa Group transactions, issued or authorised theissue of any debentures or, other than in the ordinary course of business,incurred or increased any indebtedness or become subject to any contingentliability; (viii) purchased, redeemed or repaid or announced any proposal to purchase,redeem or repay any of its own shares or other securities or reduced or, save inrespect to the matters mentioned in sub-paragraph (i) of this paragraph (e)above, made any other change to any part of its share capital; (ix) implemented, authorised, or announced its intention to implement,any reconstruction, amalgamation, scheme, commitment or other transaction orarrangement or entered into or changed the terms or announced its intention toenter into or to change the terms of any contract with any director or seniorexecutive in each case otherwise than, in the ordinary course of business; (x) entered into or varied or authorised, or announced its intention toenter into or vary any contract, transaction or commitment (whether in respectof capital expenditure or otherwise) which is of a long term, onerous or unusualnature or magnitude or which is or could reasonably be expected to be materiallyrestrictive on the businesses of any member of the Wider Biffa Group or theWider Bidco Group or which involves or could reasonably be expected to involvean obligation of such a nature, in each case which is material in the context ofthe Wider Biffa Group or Wider Bidco Group taken as a whole; (xi) (other than in respect of a member which is dormant and was solventat the relevant time) taken any corporate action or had any legal proceedingsstarted or threatened against it for its winding-up (voluntary or otherwise),dissolution or reorganisation or for the appointment of a receiver,administrative receiver, administrator, trustee or similar officer of all or anymaterial part of its assets or revenues or any analogous proceedings in anyjurisdiction or had any such person, or analogous person in any jurisdiction,appointed; (xii) been unable or admitted in writing that it is unable to pay its debtsor having stopped or suspended (or threatened to stop or suspend) payment of itsdebts generally or ceased or threatened to cease carrying on all or asubstantial part of its business or waived, compromised or settled any claimotherwise than in the ordinary course of business and in each case which ismaterial in the context of the Wider Biffa Group taken as a whole; (xiii) (save as disclosed on a publicly available register) made anyalterations to its memorandum or articles of association; (xiv) entered into any contract, commitment, arrangement or agreement otherthan in the ordinary course of business or passed any resolution or made anyoffer (which remains open for acceptance) with respect to or announced anyintention to, or to propose to, effect any of the transactions, matters orevents referred to in this condition; (xv) terminated or varied the terms of any agreement or arrangementbetween any member of the Wider Biffa Group and any other person in a mannerwhich would or might reasonably be expected to have a material adverse effect onthe financial position or the prospects of the Wider Biffa Group taken as awhole; (xvi) proposed, agreed to provide or modified the terms of any share optionscheme, incentive scheme or other benefit relating to the employment ortermination of employment of any person employed by the Wider Biffa Group; or (xvii) made or agreed or consented to any change to: (1) the terms of the trust deeds constituting the pension scheme(s)established by any member of the Wider Biffa Group for its directors, employeesor their dependents; (2) the contributions payable to any such scheme(s) or to the benefits whichaccrue or to the pensions which are payable thereunder; (3) the basis on which qualification for, or accrual or entitlement to, suchbenefits or pensions is calculated or determined; or (4) the basis upon which the liabilities (including pensions) of such pensionschemes are funded or valued; except for changes to contributions consequent upon, and use of the valuationand funding basis in, the actuarial valuation of the Biffa Pension Scheme as at31 March 2006; (f) since 30 March 2007 and save as Disclosed and which ineach case is material in the context of the Wider Biffa Group taken as a whole: (i) no adverse change or deterioration having occurred in thebusiness, assets, financial or trading position or profits or prospects of anymember of the Wider Biffa Group; (ii) no litigation, arbitration proceedings, prosecution or other legalproceedings to which any member of the Wider Biffa Group is or may become aparty (whether as a claimant, respondent or otherwise) and (other than as aresult of the Acquisition) no investigation by any Third Party against or inrespect of any member of the Wider Biffa Group having been instituted, announcedor threatened by or against or remaining outstanding in respect of any member ofthe Wider Biffa Group; (iii) no contingent or other liability having arisen or become apparentto Bidco which would be likely to adversely affect any member of the Wider BiffaGroup; or (iv) no steps having been taken which are likely to result in thewithdrawal, cancellation, termination or modification of any licence held by anymember of the Wider Biffa Group which is necessary or desirable for the propercarrying on of its business; (g) since 30 March 2007 and save as Disclosed and which in eachcase is material in the context of the Wider Biffa Group taken as a whole, Bidconot having discovered: (i) that any financial, business or other information concerning theWider Biffa Group as contained in the information publicly disclosed at any timeby or on behalf of any member of the Wider Biffa Group is misleading, contains amisrepresentation of fact or omits to state a fact necessary to make thatinformation not misleading, and which was not subsequently corrected before thedate of this announcement by public disclosure; (ii) that any member of the Wider Biffa Group, partnership, company orother entity in which any member of the Wider Biffa Group has a significanteconomic interest and which is not a subsidiary undertaking of the Wider BiffaGroup is subject to any liability (contingent or otherwise); or (iii) any information which affects the import of any informationdisclosed at any time by or on behalf of any member of the Wider Biffa Group; (h) save as Disclosed, Bidco not having discovered that: (i) any past or present member of the Wider Biffa Group has failed tocomply with any and/or all applicable legislation or regulation, of anyjurisdiction with regard to the use, treatment, handling, storage, disposal,spillage, release, discharge, leak or emission of any waste or hazardoussubstance or any substance likely to impair the environment or harm human healthor animal health or otherwise relating to environmental matters, or that therehas otherwise been any such use, treatment, handling, storage, disposal,spillage, release, discharge, leak or emission (whether or not the sameconstituted a non-compliance by any person with any such legislation orregulations, and wherever the same may have taken place) any of which use,treatment, handling, storage, disposal, spillage, release, discharge, leak oremission would be reasonably likely to give rise to any liability (actual orcontingent, civil or criminal) on the part of any member of the Wider BiffaGroup and which is material in the context of the Wider Biffa Group taken as awhole; or (ii) there is, or is likely to be, for that or any other reasonwhatsoever, any liability (actual or contingent) of any past or present memberof the Wider Biffa Group to make good, repair, reinstate or clean up orotherwise assume responsibility for any property or any controlled waters now orpreviously owned, occupied, operated or made use of or controlled by any suchpast or present member of the Wider Biffa Group, under any environmentallegislation, regulation, notice, circular or order of any government,governmental, quasi-governmental, state or local government, supranational,statutory or other regulatory body, agency, court, association or any otherperson or body in any jurisdiction and which is material in the context of theWider Biffa Group taken as a whole. Part B: Waiver of Conditions and further terms of the Acquisition Subject to the requirements of the Panel, Bidco reserves the right to waive, inwhole or in part, all or any of the above conditions, except condition 1 andcondition 2(a). Bidco shall be under no obligation to waive or treat assatisfied any of the Conditions by a date earlier than the last date specifiedabove for the fulfilment of that Condition notwithstanding that the otherConditions of the Acquisition may, at such earlier date, have been waived orfulfilled and that there are, at such earlier date, no circumstances indicatingthat any of such conditions may not be capable of fulfilment or waiver. Bidco reserves the right to elect to implement the Acquisition by way of theOffer. In such event, the Offer will be implemented on the same terms (subjectto appropriate amendments, including (without limitation) an acceptancecondition set at ninety per cent. (or such lesser percentage, being more thanfifty per cent., as Bidco may decide) of the shares to which the Offer wouldrelate), so far as applicable, as those which would apply to the Scheme. If Bidco is required by the Panel to make an offer for Biffa Shares under theprovisions of Rule 9 of the City Code, Bidco may make such alterations to theConditions as are necessary to comply with the provisions of that rule. The Acquisition will lapse and the Scheme will not become effective if theEuropean Commission initiates proceedings under Article 6(1)(c) of CouncilRegulation (EC) 139/2004 (the "Regulation") or there is a reference to theCompetition Commission following a referral by the European Commission underArticle 9.1 of the Regulation to a competent authority in the United Kingdombefore the date of the Court Meeting. The Scheme will be governed by English law and is subject to the jurisdiction ofthe English courts. The Scheme will comply with the applicable rules andregulations of the Financial Services Authority, London Stock Exchange and theCity Code. Biffa Shares will be acquired under the Acquisition fully paid and free from allliens, equitable interests, charges, encumbrances and rights of pre-emption andany other interests of any nature whatsoever and together with all rightsattaching thereto. Any new Biffa Shares issued to Bidco or its nominee(s)pursuant to the Scheme will be issued on the same basis. Appendix II: Bases of calculations and sources of information (a) As at the close of business on 7 February 2008, being the lastBusiness Day prior to the date of this announcement, there were 349,871,336Biffa Shares in issue and a further 1,841,701 Biffa Shares which may be issuedpursuant to the Biffa Share Schemes, subject to certain vesting conditions beingsatisfied. (b) The value attributed to the existing issued share capital ofBiffa is based upon the 349,871,336 Biffa Shares in issue on 7 February 2008(being the latest practicable date prior to this announcement). (c) The value attributed to the fully diluted share capital of Biffais based upon the 349,871,336 Biffa Shares in issue on 7 February 2008 (beingthe latest practicable date prior to this announcement), adjusted for thedilutive effect of the Biffa Shares which may be issued pursuant to the BiffaShare Schemes (not adjusted for proceeds received pursuant to the exercise ofoptions under the Biffa Share Schemes). (d) The premia implied by the offer price have been calculated basedon Closing Prices derived from the London Stock Exchange on the relevant datesand as supplied by Datastream. (e) Unless otherwise stated, the financial information concerningBiffa has been extracted from the Annual Report or from the unaudited interimfinancial statements of the Biffa Group for the 26 week period ended 28September 2007. (f) The International Securities Identification Number for BiffaShares is GBOOB129PL77. Appendix III: Details of irrevocable undertakings Irrevocable undertakings as described in paragraph 12 of this announcement inrespect of the number of Biffa Shares set out below have been given to Bidco. Name of Biffa Shareholder Total number of Biffa Percentage of existing Shares issued share capital of Biffa (%)Martin Bettington 80,999 0.02Robert Davies 140,000 0.04Timothy Lowth 69,087 0.02Roger Payne 15,000 0.004Angela Risley 3,494 0.001Wastebidco Limited 8,551,566 2.44Total 8,860,146 2.53 Appendix IV: Definitions The following definitions apply throughout this announcement, unless the contextotherwise requires: "Acquisition" the proposed acquisition by Bidco of the entire issued and to be issued share capital of Biffa to be implemented by means of the Scheme or, should Bidco so elect, by means of the Offer "Annual Report" the annual report and accounts of Biffa for the year ended 30 March 2007 "Australia" the Commonwealth of Australia, its possessions, territories and all areas subject to its jurisdiction and any political subdivision thereof "Bidco" WasteAcquisitionco Limited, a company registered in England and Wales with company number 6409675 "Bidco Consortium" Montagu Private Equity and the Montagu Funds, Global Infrastructure Partners and the GIP Funds, UCIL and all other persons (if any) who from time to time acquire or become directly or indirectly interested in the issued share capital of Bidco "Bidco Group" Bidco and its direct and indirect holding companies and entities (excluding, for the avoidance of doubt, the Montagu Funds, the GIP Funds and UCIL) "Biffa" Biffa Plc, a company registered in England and Wales with company number 4081901 "Biffa Directors" the existing board of directors of Biffa "Biffa Group" Biffa and its subsidiaries and subsidiary undertakings "Biffa Pension Scheme" the Biffa Pension Scheme governed by rules appended to a deed dated 30 March 2007 (as amended) "Biffa Shareholder(s)" holder(s) of Biffa Shares "Biffa Shares" the ordinary shares of 10 pence each in the capital of Biffa "Biffa Share Schemes" the Biffa Long Term Incentive Plan, Biffa Sharesave Scheme, Biffa Share Incentive Plan and, to the extent that Biffa employees participate in them, the Severn Trent Sharesave Scheme and the Severn Trent Share Incentive Plan "Board" the existing board of directors of Biffa or Bidco as the case may be "Business Day" any day other than a Saturday or a Sunday or public holiday when banks generally are open in London for general banking business "Canada" Canada, its possessions and territories and all areas subject to its jurisdiction and any political subdivision thereof "Capital Reduction" the reduction of Biffa's share capital provided for by the Scheme "Citi" Citigroup Global Markets Limited "City Code" the City Code on Takeovers and Mergers "Closing Price" the middle market price of a Biffa Share at the close of business on the day to which such price relates, as derived from the London Stock Exchange for that day "Companies Acts" the Companies Act 1985 and/or the Companies Act 2006, as applicable "Competition Commission" the body established under the Competition Act 1998 "Conditions" the conditions to the implementation of the Acquisition (including the Scheme), which are set out in Appendix I to this announcement "Cory Environmental" Cory Environmental Management Limited, 2 Coldbath Square, London EC1R 5HL "Court" the High Court of Justice in England and Wales "Court Meeting" the meeting of Biffa Shareholders to be convened pursuant to an order of the Court under the Companies Acts for the purposes of considering and, if thought fit, approving the Scheme (with or without modification) and any adjournment thereof "Court Order(s)" the order of the Court sanctioning the Scheme under the Companies Acts and the order of the Court confirming the Capital Reduction under the Companies Acts respectively, or where the context requires, either of them "Credit Suisse Group" a global financial services company headquartered in Zurich, Switzerland with shares listed in Switzerland and on the New York Stock Exchange "CREST" the relevant system (as defined in the CREST Regulations) in respect of which Euroclear UK & Ireland Limited is the operator (as defined in the CREST Regulations) "CREST Regulations" the Uncertificated Securities Regulations 2001 (SI 2001 No. 3755) "Deutsche Bank" Deutsche Bank AG, London Branch "Disclosed" means (i) as disclosed in the Annual Report; or (ii) as publicly announced by Biffa (by the delivery of an announcement to an authorised Regulatory Information Service) prior to the date of this announcement; or (iii) as fairly disclosed by or on behalf of Biffa to Bidco or its advisers on or prior to the date of this announcement "Effective Date" the date on which the Scheme becomes effective pursuant to its terms or, should Bidco elect to implement the Acquisition by means of the Offer, the date on which the Offer becomes or is declared unconditional in all respects "EGM" the extraordinary general meeting of Biffa Shareholders (and any adjournment thereof) to be convened in connection with the Acquisition, notice of which will be set out in the Scheme Document "Excluded Shares" any Biffa Shares, which at the relevant time are registered in the name of, or beneficially owned by Bidco, or which Bidco acquires or becomes beneficially interested in from time to time "Family Trust" as regards any individual, a trust under which no immediate beneficial interest in any of the Loan Notes is for the time being vested in any person other than the individual or Relatives of the individual and by virtue of which no voting or other rights attaching thereto are or may become liable to be exercisable by or as directed by or subject to the consent of any person other than the individual and Relatives of the individual or the trustees as trustees of such trust "First Interest Calculation Date" 31 December 2008 "First Interest Payment Date" the first Interest Payment Date following the First Interest Calculation Date "Form of Election" the form of election to be sent to Scheme Shareholders by or on behalf of Biffa pursuant to which a Scheme Shareholder (other than a Restricted Overseas Person) may make an election under the Loan Note Alternative in respect of some or all of their Scheme Shares "Forms of Proxy" the forms of proxy for use at the EGM and the Court Meeting "GIM" Global Infrastructure Management LLC, a Delaware limited liability company "GIP" or "Global Infrastructure Partners" the trading name of the GIP Funds "GIP Funds" Global Infrastructure Partners - A1, L.P., Global Infrastructure Partners - B, L.P. and Global Infrastructure Partners - C, L.P., each a Guernsey limited partnership managed by GIM "HBOS" HBOS plc "HBOS Group" HBOS, its subsidiaries and subsidiary undertakings from time to time, or any of them, as the context requires "HgCapital" the trading name of Hg Pooled Management Limited, a company registered in England and Wales with company number 2055886 "HSBC" HSBC Bank plc "HSBC Group" HSBC, its subsidiaries and subsidiary undertakings from time to time, or any of them, as the context requires "Implementation Agreement" the implementation agreement dated on or about the date of this announcement between Biffa and Bidco pursuant to which, amongst other things, the parties have agreed to implement the Scheme "Interest Calculation Date" 30 June and 31 December in each year but not 30 June 2008, subject always to clause 3.1 of the Loan Note Instrument "Interest Payment Date" the 14th day following each Interest Calculation Date "Interest Period" each of the periods from (and including) the date of issue of the Loan Notes to the relevant Noteholders to (and including) the day immediately before the First Interest Calculation Date and from (and including) the First Interest Calculation Date or any subsequent Interest Calculation Date to (and including) the day immediately before the next following Interest Calculation Date "Japan" Japan, its cities, prefectures, territories and possessions "JPMorgan Cazenove" JPMorgan Cazenove Limited "LIBOR" London interbank offered rate "Loan Note Alternative" the alternative whereby Scheme Shareholders (other than Restricted Overseas Persons) may elect, subject to certain limitations and conditions, to receive Loan Notes instead of some or all of the cash consideration to which they would otherwise be entitled under the Acquisition "Loan Note Deadline" 3.00 p.m. on the Business Day immediately prior to the Scheme Hearing or as agreed between Biffa and Bidco "Loan Note Instrument" the loan note instrument constituting the Loan Notes to be executed as a deed by Bidco "Loan Notes" the loan notes to be issued by Bidco pursuant to the Loan Note Alternative "Loan Note Elected Shares" Scheme Shares in respect of which the holder has validly elected to participate in the Loan Note Alternative"London Stock Exchange" London Stock Exchange plc "Merrill Lynch" Merrill Lynch International "Montagu Funds" Montagu III LP, Montagu III GmBH & Co KG and Montagu Investor LP, each managed or advised by Montagu Private Equity "Montagu Private Equity" Montagu Private Equity LLP, a limited liability partnership registered in England with number OC319972 "Non-Qualifying Corporate Bond" a debt instrument which is not a "qualifying corporate bond" as defined in section 117 of the Taxation and Chargeable Gains Act 1992 for purposes other than those of corporation tax "Non-Solicitation and Inducement Fee the non-solicitation and inducement fee agreement dated 25Agreement" January 2008, as novated, between Bidco and Biffa "Noteholder(s)" holder(s) of the Loan Notes "Offer Period" the period commencing on 23 November 2007 "Offer" should Bidco elect to make the Acquisition by way of a takeover offer (as that term is defined in the Companies Acts), the recommended cash offer to be made by Bidco to acquire all of the issued and to be issued Biffa Shares not already owned by Bidco and its associates and, where the context admits, any subsequent revision, variation, extension or renewal of such offer "Official List" the Official List of the UK Listing Authority "Panel" the Panel on Takeovers and Mergers "Permitted Transferee" in relation to any Noteholder, a Relative of the Noteholder or the trustees of a Family Trust of the Noteholder or of a Relative of the Noteholder "£" UK pounds sterling, the lawful currency of the United Kingdom "Redemption Date" the first Interest Payment Date which falls after the fifth (5th) anniversary of the Effective Date "Registrar" the Registrar of Companies in England and Wales "Regulatory Information Service" any of the services set out in Schedule 12 to the listing rules of the UK Listing Authority"Relative" in relation to any Noteholder, any parent, child, illegitimate child, step-child (including in each case by adoption) or spouse of that person and references to a "spouse" include a civil partner under the UK Civil Partnership Act 2004 "Restricted Jurisdiction" the United States, Australia, Canada, Japan or New Zealand or any other jurisdiction where extension or acceptance of the Acquisition would violate the law of, or regulation applicable to, that jurisdiction "Restricted Overseas Persons" (i) a person who is in, or resident in, Australia, Canada, New Zealand or Japan; (ii) any person whom Bidco believes to be in, or resident in, Australia, Canada, New Zealand or Japan; (iii) any person holding Biffa Shares as custodian, nominee or trustee for persons in, or resident in, Australia, Canada, New Zealand or Japan; (iv) US Persons; and (v) persons in, or resident in, any other jurisdiction who Bidco determines should be ineligible to apply for the Loan Note Alternative because of any prohibition or restriction or the need to comply with any governmental or other consent or any registration, filing or other formality unless such person can satisfy Bidco (in Bidco's absolute discretion) that to comply with such consent, registration, filing or other formality would not be unduly onerous. For the purposes of this definition, "person" includes an individual, corporation, partnership, unincorporated syndicate, limited liability company, unincorporated organisation, trust, trustee, executor, administrator or other legal representative "Scheme" the proposed scheme of arrangement under the Companies Acts between Biffa and the Scheme Shareholders, the full terms of which will be set out in the Scheme Document "Scheme Document" the document to be sent to Biffa Shareholders containing and setting out the Scheme and the notices convening the Court Meeting and the EGM "Scheme Hearing" the Court hearing at which the order of the Court sanctioning the Scheme under the Companies Acts is expected to be granted "Scheme Record Time" 6.00 p.m. on the Business Day immediately prior to the Effective Date "Scheme Shareholders" holders of the Scheme Shares "Scheme Shares" (i) the Biffa Shares in issue at the date of the Scheme Document; (ii) any Biffa Shares issued after the date of the Scheme Document and before the Voting Record Time; and (iii) any Biffa Shares issued at or after the Voting Record Time and before the Scheme Record Time either on terms that the original or any subsequent holders of such shares are to be bound by the Scheme or in respect of which their holders are, or have agreed in writing, to be bound by the Scheme, in each case other than the Excluded Shares"Severn Trent" Severn Trent Plc, a company registered in England and Wales with company number 2366619 "Third Party Transaction" a proposal in respect of an offer, scheme of arrangement, merger or business combination or similar transaction, or any revisions thereof, proposed by a third party which is not acting in concert with Bidco and is not a joint offeror of Bidco and the purpose of which is to enable that third party (or any other person) to acquire all or a significant proportion (being 30 per cent., or more when aggregated with shares already held by the third party and anybody acting in concert with that third party) of the issued ordinary share capital of Biffa, or all or a significant proportion (being 30 per cent., or more) of its undertaking, assets or business "Tricorn Partners" Tricorn Partners LLP "UBS" or "UBS Investment Bank" UBS Limited, 1 Finsbury Avenue, London EC2M 2PP "UCIL" Uberior Co-Investments Limited, a company incorporated in Scotland (Registered Number SC286372) whose registered office is at Level 1, Citymark, 150 Fountainbridge, Edinburgh EH3 9PE, an indirect wholly owned subsidiary of HBOS "UK Listing Authority" the Financial Services Authority acting in its capacity as the competent authority for the purposes of Part VI of the Financial Services and Markets Act 2000 (as amended) "United Kingdom" or "UK" the United Kingdom of Great Britain and Northern Ireland "United States" or "US" the United States of America, its territories and possessions, any State of the United States of America and the District of Columbia "US Person" a US person as defined in Regulation S of the US Securities Act "US Securities Act" US Securities Act of 1933, as amended "Voting Record Time" the date and time to be fixed by the Court for determining entitlement to vote at the Court Meeting or any adjournment thereof (to be set out in the notice of Court Meeting) "Wastebidco" Wastebidco Limited, a company incorporated in England and Wales with registered number 6344144 which was established by Montagu Private Equity and HgCapital and in whom the shareholders are the Montagu Funds, funds managed by HgCapital and UCIL "Wider Bidco Group" Bidco and its subsidiary undertakings, associated undertakings and any other undertaking in which Bidco and/or such undertakings (aggregating their interests) have a significant interest "Wider Biffa Group" Biffa and its subsidiary undertakings, associated undertakings and any other undertaking or partnership in which Biffa and/or such undertakings (aggregating their interests) have a significant interest All the times referred to in this announcement are to London times. For these purposes "subsidiary undertaking", "associated undertaking" and "undertaking" have the meanings given by the Companies Act 1985; other thanparagraph 20(1)(b) of Schedule 4A to the Companies Act 1985 which shall beexcluded for this purpose and "significant interest" means a direct or indirectinterest in ten per cent. or more of the equity share capital (as defined inCompanies Act 1985). Words importing the singular shall include the plural and vice versa. This information is provided by RNS The company news service from the London Stock Exchange

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Related Shares:

BIFF.L