3rd Aug 2005 12:13
Compagnie de Saint-Gobain03 August 2005 Not for release, publication or distribution, in whole or in part, in, into orfrom Australia, Canada or Japan 3 August 2005 SAINT-GOBAIN CASH OFFER of 720 pence for each BPB Share by BNP PARIBAS and UBS INVESTMENT BANK on behalf of the offeror a wholly-owned subsidiary of SAINT-GOBAIN and (in the United States) by the Offeror for BPB PLC Summary • The board of Saint-Gobain announces the terms of a cash offer for the entire issued and to be issued ordinary share capital of BPB. The Offer will be made outside the United States by BNP Paribas and UBS on behalf of the Offeror, a wholly owned subsidiary of Saint-Gobain, and inside the United States by the Offeror. • The Offer of 720 pence in cash for each BPB Share, valuing the entire issued and to be issued ordinary share capital of BPB at approximately £3,677 million, provides BPB Shareholders with an opportunity to realise value in cash at a very significant premium. • The Offer represents a premium of approximately - 40.5 per cent. to the closing price of 512.5 pence for each BPB Share on 20 July 2005, the last trading day prior to commencement of the Offer Period; and - 43.3 per cent. to the average closing price of 502.5 pence for each BPB Share for the three months prior to and including 20 July 2005, the last trading day prior to commencement of the Offer Period. • The Offer represents a multiple of - 18.9 times earnings per share before exceptional items and goodwill amortisation; and - 9.8 times EBITDA for the year ended 31 March 2005. • The multiples compare favourably with other transactions in the sector. • The acquisition of BPB sits at the core of Saint-Gobain's strategy. The board of Saint-Gobain strongly believes an acquisition of BPB by Saint-Gobain will provide significant benefits: - there is an excellent business case for a combination of Saint-Gobain's and BPB's businesses, from both a product and geographic perspective. In particular, the Enlarged Group will have a broader global footprint from which to offer customers a wider range of products and solutions; - the Enlarged Group will be present in all key global building materials markets with product offerings across a broad range of high growth product segments, particularly insulation and plasterboard, and will offer attractive development opportunities. BPB's strong presence in the North American plasterboard market complements Saint-Gobain's wall siding, roofing and insulation products portfolio in that region. In Europe, the Enlarged Group will benefit from further scale in building materials manufacturing and be able to develop its presence in Central and Eastern Europe. The respective footholds of BPB and Saint-Gobain in Asia will provide the Enlarged Group with a platform for further expansion in high growth, emerging markets; - the combined industrial, commercial, technical and marketing excellences, directed at the same client base (contractors, distributors and installers) in the newbuild and renovation markets, will improve the Enlarged Group's ability to fully benefit from market growth opportunities; - as part of the Enlarged Group, BPB will benefit from the financial strength and geographic spread of a large international group; - the partnership between Saint-Gobain and BPB will enable the Enlarged Group to enhance top-line growth and generate cost synergies through a combined product offering and the sharing of commercial, operational and logistics best practices. Commenting on the Offer, Saint-Gobain said: "We are very disappointed that the Board of BPB has taken the attitude it hastaken. We have tried three times to engage BPB in meaningful negotiation andhave failed to do so. In both the press announcement of Friday 22 July and theannouncement that was put out this morning by BPB, our approach was described as"unwelcome", but we very much doubt it is unwelcome to BPB Shareholders. In theface of this inability to reach a private agreement, Saint-Gobain now has nooption other than to put its proposal to BPB Shareholders. As the offer of Saint-Gobain is in cash, the issue for BPB Shareholders is thefair value of BPB. Saint-Gobain has considered this issue very carefully andbelieves that, based on the information available to it including that releasedtoday, 720 pence per share fully and fairly values the company. It is now up tothe Board and management of BPB to put substance to its statement thatSaint-Gobain's proposal substantially undervalues BPB. We look forward to thejustification of this statement. It is a matter of real regret that we have toconduct this price discussion in public." This summary should be read in conjunction with, and is subject to, the fulltext of the attached announcement. The Offer will be subject to the conditionsset out in Appendix I and to the full terms and conditions set out in the OfferDocument and Form of Acceptance. Enquiries Saint-Gobain (for analysts and investors) Florence Triou-Teixeira, Head of IR Tel: +33 1 47 62 45 19Alexandre Etuy, Deputy Head of IR Tel: +33 1 47 62 37 15 BNP Paribas (joint financial adviser to Saint-Gobain) Oliver Ellingham Tel: +44 20 7595 2000Thierry Dormeuil Tel: +33 1 42 98 12 34 UBS Investment Bank (joint financial adviser and broker to Saint-Gobain) Liam Beere Tel: +44 20 7567 8000Charles-Henri Le Bret Tel: +33 1 48 88 30 30 Brunswick (PR adviser to Saint-Gobain) John Sunnucks Tel: +44 20 7404 5959Sophie Fitton Tel: +44 20 7404 5959 Investor Communications Analyst/investor presentation: Time: 1:00 p.m. (London time) today Venue: Butchers Hall, 87 Bartholomew Close, London EC1A 7EB Dial-in: +44 20 7947 5011; replay from 2:00 p.m. (London time) Live webcast: www.saint-gobain.com; replay at 6:00 p.m. (London time) Media briefing: Time: 3:00 p.m. (London time) today Venue: Butchers Hall, 87 Bartholomew Close, London EC1A 7EB Terms used in this summary shall have the meaning given to them in Appendix II.The Offer Document and the Form of Acceptance will be posted to BPB Shareholders(other than to persons with addresses in Restricted Jurisdictions), as soon aspracticable and, in any event, within 28 days of this announcement unlessotherwise agreed with the Panel. This announcement does not constitute an offer to sell or an invitation topurchase any securities or the solicitation of an offer to subscribe for or buyany securities, pursuant to the Offer or otherwise. The Offer will be madesolely by the Offer Document and the Form of Acceptance accompanying the OfferDocument, which will contain the full terms and conditions of the Offer,including details of how the Offer may be accepted. BNP Paribas and UBS are acting exclusively for Saint-Gobain and the Offeror inconnection with the Offer and no one else, and will not be responsible to anyoneother than Saint-Gobain and the Offeror for providing the protections affordedto respective clients of BNP Paribas and UBS nor for providing advice inrelation to the Offer or any other matter referred to herein. Copies of this announcement and any documentation relating to the Offer are notbeing, and must not be, directly or indirectly, mailed or otherwise forwarded,distributed or sent in or into or from any Restricted Jurisdiction and personsreceiving such documents (including custodians, nominees and trustees) must notmail or otherwise forward, distribute or send it in or into or from a RestrictedJurisdiction. The Offer (unless otherwise determined by the Offeror andpermitted by applicable law and regulation), will not be made, directly orindirectly, in or into, a Restricted Jurisdiction and the Offer will not becapable of acceptance from or within any Restricted Jurisdiction. The ability of BPB Shareholders who are not resident in and citizens of theUnited Kingdom to accept the Offer may be affected by the laws of the relevantjurisdictions in which they are located or of which they are citizens. Suchpersons should inform themselves of, and observe, any applicable legal orregulatory requirements of their jurisdictions. Further details in relation tooverseas shareholders will be contained in the Offer Document. The Offer in the United States is made solely by the Offeror and neither BNPParibas, UBS nor any of their respective affiliates is making the Offer into theUnited States. In accordance with normal UK market practice and pursuant to an exemptive orderfrom the SEC, the Offeror, Saint-Gobain or their nominees or brokers (acting asagents) may from time to time make certain purchases of, or arrangements topurchase, BPB Shares outside the United States, other than pursuant to theOffer, before or during the period in which the Offer remains open foracceptance. These purchases may occur either in the open market at prevailingprices or in private transactions at negotiated prices. Any information aboutsuch purchases will be disclosed as required in the UK and communicated in theUS by way of an announcement by or on behalf of the Offeror. This announcement, including information included or incorporated by referencein this announcement, contains "forward-looking statements" concerningSaint-Gobain and BPB. Information in this announcement relating to BPB has beencompiled from published sources. Generally, the words "will", "may", "should","continue", "believes", "expects", "intends", "anticipates" or similarexpressions identify forward-looking statements. These forward-lookingstatements involve risks and uncertainties that could cause actual results todiffer materially from those expressed in the forward-looking statements. Manyof these risks and uncertainties relate to factors that are beyond thecompanies' ability to control or estimate precisely, such as future marketconditions and the behaviour of other market participants. Although we believethat the expectations reflected in such forward-looking statements arereasonable, we can give no assurance that such expectations will prove to havebeen correct. We caution you not to place undue reliance on theseforward-looking statements, which speak only as of the date of this documentand, except as otherwise required by law, Saint-Gobain does not undertake toupdate any of the forward-looking statements set out herein. Not for release, publication or distribution, in whole or in part, in, into orfrom Australia, Canada or Japan 3 August 2005 SAINT-GOBAIN CASH OFFER of 720 pence for each BPB Share by BNP PARIBAS and UBS INVESTMENT BANK on behalf of the offeror a wholly-owned subsidiary of SAINT-GOBAIN and (in the United States) by the Offeror for BPB PLC 1. Introduction The board of Saint-Gobain announces the terms of a cash offer for the entireissued and to be issued ordinary share capital of BPB. The Offer will be madeoutside the United States by BNP Paribas and UBS on behalf of the Offeror, awholly owned subsidiary of Saint-Gobain, and inside the United States by theOfferor. 2. The Offer Under the Offer, which will be subject to the conditions and further terms setout in Appendix I and those to be set out in the Offer Document and Form ofAcceptance, BPB Shareholders will receive: for each BPB Share 720 pence in cash The Offer of 720 pence in cash for each BPB Share, valuing the entire issued andto be issued ordinary share capital of BPB at approximately £3,677 million,provides BPB Shareholders with an opportunity to realise value in cash at a verysignificant premium. • The Offer represents a premium of approximately - 40.5 per cent. to the closing price of 512.5 pence for each BPB Share on 20 July 2005, the last trading day prior to commencement of the Offer Period; and - 43.3 per cent. to the average closing price of 502.5 pence for each BPB Share for the three months prior to and including 20 July 2005, the last trading day prior to commencement of the Offer Period. • The Offer represents a multiple of - 18.9 times earnings per share before exceptional items and goodwill amortisation; and - 9.8 times EBITDA for the year ended 31 March 2005. The multiples compare favourably with other transactions in the sector. BPB Shares will be acquired by or on behalf of the Offeror pursuant to the Offerfully paid and free from all liens, charges, equitable interests, encumbrances,rights of pre-emption and any other third party rights of any nature whatsoeverand together with all rights now or hereafter attaching to such sharesincluding, without limitation, the right to receive in full all dividends (otherthan the final dividend for the year ended 31 March 2005 to be paid on 19 August2005) and other distributions (if any) declared, paid or made on or after thedate of this announcement. If any dividend (other than the final dividend forthe year ended 31 March 2005 to be paid on 19 August 2005) or other distributionis declared, paid or made on or after the date of this announcement, the Offerorreserves the right to reduce the Offer Price by the amount of such dividend ordistribution. The sources and bases of certain financial information contained in thisannouncement are set out in Appendix III. 3. Background to and reasons for the Offer The acquisition of BPB sits at the core of Saint-Gobain's strategy. The boardof Saint-Gobain strongly believes an acquisition of BPB by Saint-Gobain willprovide significant benefits: • There is an excellent business case for a combination of Saint-Gobain's and BPB's businesses, from both a product and geographic perspective. In particular, the Enlarged Group will have a broader global footprint from which to offer customers a wider range of products and solutions; • The Enlarged Group will be present in all key global building materials markets with product offerings across a broad range of high growth product segments, particularly insulation and plasterboard, and will offer attractive development opportunities. BPB's strong presence in the North American plasterboard market complements Saint-Gobain's wall siding, roofing and insulation products portfolio in that region. In Europe, the Enlarged Group will benefit from further scale in building materials manufacturing and be able to develop its presence in Central and Eastern Europe. The respective footholds of BPB and Saint-Gobain in Asia will provide the Enlarged Group with a platform for further expansion in high growth, emerging markets; • The combined industrial, commercial, technical and marketing excellences, directed at the same client base (contractors, distributors and installers) in the newbuild and renovation markets, will improve the Enlarged Group's ability to fully benefit from market growth opportunities; • As part of the Enlarged Group, BPB will benefit from the financial strength and geographic spread of a large international group; • The partnership between Saint-Gobain and BPB will enable the Enlarged Group to enhance top-line growth to generate and cost synergies through a combined product offering and the sharing of commercial, operational and logistics best practices. Saint-Gobain intends to integrate BPB into its current organisational structureas a new division within the Construction Products business. Saint-Gobain willwork proactively with BPB to enable a smooth and rapid integration of the twocompanies and minimise disruption to BPB. Saint-Gobain has an existing closeworking relationship with BPB through its joint venture in insulation productsin the United Kingdom and Ireland and Saint-Gobain hopes that the BPB managementteam will continue to oversee the further development of this new division.Saint-Gobain has a track record of successfully integrating large acquiredbusinesses. 4. Information on Saint-Gobain Saint-Gobain is a leading global manufacturer of high-technology materials,which include the production, processing and distribution of materials, such asglass, ceramics, plastics and cast iron. Saint-Gobain operates in 49 countriesworldwide and fields a workforce of over 180,000. Saint-Gobain is listed on the stock markets in Paris, London, Frankfurt, Zurich,Brussels and Amsterdam with a stock market capitalisation of approximately €17.0billion as at 1 August 2005. In the year ended 31 December 2004, Saint-Gobainreported consolidated revenue of €32.0 billion (2003: €29.6 billion) andoperating profit of €2.6 billion (2003: €2.4 billion). As at 31 December 2004,Saint-Gobain had shareholders' equity of €11.8 billion (2003: €11.3 billion) andnet debt of €5.6 billion (2003: €5.7 billion). 5. Information on BPB BPB is the world leader in the supply of plasterboard and gypsum plasters, and amajor supplier of insulation, ceiling tiles and related products for interiors,serving growing markets for building systems in over 50 countries. It operatesmore than 130 manufacturing sites and employs more than 12,500 people worldwide. BPB's annual plasterboard sales volume represents nearly 20 per cent. of aworld market of some 6.5 billion square metres, where demand is exhibitinglong-term average annual growth of about 5 per cent. In the year ended 31 March 2005, BPB reported group revenue of £2,317 million(2004: £2,171 million) and group operating profit of £272 million (2004: £202million). As at 31 March 2005, BPB had shareholders' equity of £945 million(2004: £819 million) and net debt of £422 million (2004: £495 million). 6. Directors, management and employees If the Offer becomes or is declared unconditional in all respects, the existingemployment rights, including pension rights, of all employees of the BPB Groupwill be fully safeguarded. 7. BPB Share Option Schemes The Offer will extend to any BPB Shares which are unconditionally allotted orissued pursuant to the exercise of the existing options under the BPB ShareOption Schemes while the Offer remains open for acceptance (or such earlier dateas Saint-Gobain or the Offeror may decide subject to the rules of the Code).Appropriate proposals will be made to participants in the BPB Share OptionSchemes in due course. 8. Financing of the Offer The cash consideration payable to BPB Shareholders under the terms of the Offerwill be provided from new facilities provided under the Credit FacilitiesAgreement. 9. Overseas shareholders The availability of the Offer to persons who are not resident in and citizens ofthe United Kingdom may be affected by the laws of their relevant jurisdiction.Such persons should inform themselves of, and observe, any applicable legal orregulatory requirements of their jurisdiction. Further details in relation tooverseas shareholders will be contained in the Offer Document. Notwithstanding the foregoing, the Offeror retains the right to permit the Offerto be accepted and any sale of securities pursuant to the Offer to be completedif, in its sole discretion, it is satisfied that the transaction in question canbe undertaken in compliance with applicable law and regulation. 10. Delisting and compulsory acquisition Once the Offeror has acquired or agreed to acquire, by virtue of itsshareholdings and acceptances of the Offer, issued share capital carrying 75 percent. or more of the voting rights of BPB, it intends to procure that BPB willapply for cancellation, respectively, of the trading in BPB Shares on the LondonStock Exchange's market for listed securities and the listing of BPB Shares fromthe Official List. A notice period of not less than 20 Business Days prior tothe cancellation will commence either on the Offeror attaining 75 per cent. ormore of the voting rights as described above or on the first date of the issueof compulsory acquisition notices under Sections 428 to 430F of the CompaniesAct. Delisting would significantly reduce the liquidity and marketability ofany BPB Shares not assented to the Offer. If the Offeror receives acceptances of the Offer in respect of, and/or otherwiseacquires, 90 per cent. or more of the BPB Shares to which the Offer relates, theOfferor intends to exercise its rights pursuant to the provisions of Sections428 to 430F of the Companies Act to acquire the remaining BPB Shares to whichthe Offer relates. 11. Dealing disclosure requirements Under the provisions of Rule 8.3 of the City Code, any person who, alone oracting together with any other person(s) pursuant to an agreement orunderstanding (whether formal or informal) to acquire or control relevantsecurities of BPB, owns or controls, or becomes the owner or controller,directly or indirectly, of one per cent. or more of any class of securities ofBPB is required to disclose, by not later than 12.00 noon (London time) on theLondon Business Day following the date of the relevant transaction, dealings insuch securities of that company (or in any option in respect of, or derivativereferenced to, any such securities) during the period to the date on which theoffer becomes or is declared unconditional as to acceptances or lapses or isotherwise withdrawn. Under the provisions of Rule 8.1 of the City Code, all dealings in relevantsecurities of BPB by the Offeror or BPB, or by any of their respective "associates" (within the meaning of the City Code) must also be disclosed. If you are in any doubt as to the application of Rule 8 to you, please contactan independent financial adviser authorised under the Financial Services andMarkets Act 2000, consult the Panel's website at www.thetakeoverpanel.org.uk orcontact the Panel on telephone number +44 (0) 207 638 0129; fax number +44 (0)207 236 7013. 12. General The Offer Document and the Form of Acceptance will be posted to BPB Shareholders(other than to persons with addresses in Restricted Jurisdictions), within 28days of the date of this announcement unless agreed otherwise with the Panel.In deciding where or not to accept the Offer in respect of their BPB Shares, BPBShareholders should rely on the information contained in, and proceduresdescribed in, the Offer Document and Form of Acceptance. UBS AG and its affiliates, who are acting in concert with the Offeror, hold2,167,122 BPB Shares. BNP Paribas and its affiliates, who are acting in concertwith the Offeror, hold (through BNP Paribas Arbitrage SNC) a long position of8,000,000 BPB Shares as a hedge in relation to an open interest in an equityswap (entered into on 5 July 2005 with a maturity date of 5 September 2005) thatconsists of a basket of shares which includes 8,000,000 BPB Shares. Save as set out in the paragraph above, neither the Offeror nor, so far as theOfferor is aware, any other person acting in concert with the Offeror, owns orcontrols any BPB Shares or any securities convertible or exchangeable into BPBShares or any rights to subscribe for or purchase the same, or holds any options(including traded options) in respect of, or has any option to acquire, any BPBShares or has entered into any derivatives referenced to BPB Shares ("RelevantBPB Securities") which remain outstanding, nor does any such person have anyarrangement in relation to Relevant BPB Securities. For these purposes, "arrangement" includes any indemnity or option arrangement, any agreement orunderstanding, formal or informal, of whatever nature, relating to Relevant BPBSecurities which may be an inducement to deal or refrain from dealing in suchsecurities. In view of the requirement for confidentiality, the Offeror has notmade any enquiries in respect of certain parties who may be deemed by the Panelto be acting in concert with it for the purposes of the Offer. The Credit Facilities Agreement provides that, save as required otherwise by thePanel, (i) Conditions 2 to 4 to the Offer as set out in Appendix 1 may only bewaived or treated as satisfied with the prior written consent of BNP Paribas andUBS and (ii) Conditions 5 to 11 of the Offer as set out in Appendix 1 may onlybe waived or treated as satisfied with the prior written consent of the MajorityLenders. Information in this announcement relating to BPB has been compiled frompublished sources. As at 9:00 a.m. (London time) on 3 August 2005, BPB had 502,209,200 ordinaryshares of 50 pence in issue (ISIN number GB0000687078). Enquiries Saint-Gobain (for analysts and investors) Florence Triou-Teixeira, Head of IR Tel: +33 1 47 62 45 19Alexandre Etuy, Deputy Head of IR Tel: +33 1 47 62 37 15 BNP Paribas (joint financial adviser to Saint-Gobain) Oliver Ellingham Tel: +44 20 7595 2000Thierry Dormeuil Tel: +33 1 42 98 12 34 UBS Investment Bank (joint financial adviser and broker to Saint-Gobain) Liam Beere Tel: +44 20 7567 8000Charles-Henri Le Bret Tel: +33 1 48 88 30 30 Brunswick (PR adviser to Saint-Gobain) John Sunnucks Tel: +44 20 7404 5959Sophie Fitton Tel: +44 20 7404 5959 Terms used in this announcement shall have the meaning given to them in AppendixIII. The Offer Document and the Form of Acceptance will be posted to BPBShareholders (other than to persons with addresses in Restricted Jurisdictions),as soon as practicable and, in any event, within 28 days of this announcementunless otherwise agreed with the Panel. This announcement does not constitute an offer to sell or an invitation topurchase any securities or the solicitation of an offer to subscribe for or buyany securities, pursuant to the Offer or otherwise. The Offer will be madesolely by the Offer Document and the Form of Acceptance accompanying the OfferDocument, which will contain the full terms and conditions of the Offer,including details of how the Offer may be accepted. BNP Paribas and UBS are acting exclusively for Saint-Gobain and the Offeror inconnection with the Offer and no one else, and will not be responsible to anyoneother than Saint-Gobain and the Offeror for providing the protections affordedto respective clients of BNP Paribas and UBS nor for providing advice inrelation to the Offer or any other matter referred to herein. Copies of this announcement and any documentation relating to the Offer are notbeing, and must not be, directly or indirectly, mailed or otherwise forwarded,distributed or sent in or into or from a Restricted Jurisdiction and personsreceiving such documents (including custodians, nominees and trustees) must notmail or otherwise forward, distribute or send it in or into or from a RestrictedJurisdiction. The Offer (unless otherwise determined by the Offeror andpermitted by applicable law and regulation), will not be made, directly orindirectly, in or into, a Restricted Jurisdictions and the Offer will not becapable of acceptance from or within any Restricted Jurisdiction. The ability of BPB Shareholders who are not resident in and citizens of theUnited Kingdom to accept the Offer may be affected by the laws of the relevantjurisdictions in which they are located or of which are citizens. Such personsshould inform themselves of, and observe, any applicable requirements. Furtherdetails in relation to overseas shareholders will be contained in the OfferDocument. The Offer in the United States is made solely by the Offeror and neither BNPParibas, UBS nor any of their respective affiliates is making the Offer into theUnited States. In accordance with normal UK market practice and pursuant to an exemptive orderfrom the SEC, the Offeror, Saint-Gobain or their nominees or brokers (acting asagents) may from time to time make certain purchases of, or arrangements topurchase, BPB Shares outside the United States, other than pursuant to theOffer, before or during the period in which the Offer remains open foracceptance. These purchases may occur either in the open market at prevailingprices or in private transactions at negotiated prices. Any information aboutsuch purchases will be disclosed as required in the UK and communicated in theUS by way of an announcement by or on behalf of the Offeror. This announcement, including information included or incorporated by referencein this announcement, contains "forward-looking statements" concerningSaint-Gobain and BPB. Information in this announcement relating to BPB has beencompiled from published sources Generally, the words "will", "may", "should", "continue", "believes", "expects", "intends", "anticipates" or similarexpressions identify forward-looking statements. These forward-lookingstatements involve risks and uncertainties that could cause actual results todiffer materially from those expressed in the forward-looking statements. Manyof these risks and uncertainties relate to factors that are beyond thecompanies' ability to control or estimate precisely, such as future marketconditions and the behaviour of other market participants. Although we believethat the expectations reflected in such forward-looking statements arereasonable, we can give no assurance that such expectations will prove to havebeen correct. We caution you not to place undue reliance on theseforward-looking statements, which speak only as of the date of this documentand, except as otherwise required by law, Saint-Gobain does not undertake toupdate any of the forward-looking statements set out herein. APPENDIX I CONDITIONS AND FURTHER TERMS OF THE OFFER The Offer will comply with the City Code and will be governed by English law andbe subject to the jurisdiction of the English courts. In addition, the Offerwill be subject to the terms and conditions set out below and in the Form ofAcceptance: 1 valid acceptances of the Offer being received (and not, wherepermitted, withdrawn) by no later than 3.00 pm (London time) on the firstclosing date of the Offer (or such later time(s) and/or date(s) as the Offerormay, subject to the rules of the Code, decide) in respect of not less than 90per cent. (or such lesser percentage as the Offeror may decide) of the BPBShares to which the Offer relates, provided that this condition will not besatisfied unless the Offeror and/or any member of the Offeror Group shall haveacquired or agreed to acquire (whether pursuant to the Offer or otherwise) BPBShares carrying in aggregate more than 50 per cent. of the voting rightsnormally exercisable at a general meeting of BPB. For the purposes of thisCondition: 1.1 BPB Shares which have been unconditionally allotted shall be deemed tocarry the voting rights which they will carry upon issue; 1.2 the expression "BPB Shares to which the Offer relates" shall beconstrued in accordance with Sections 428 to 430F of the Companies Act; and 1.3 valid acceptances shall be deemed to have been received in respect ofBPB Shares which are treated for the purposes of section 429(8) of the CompaniesAct as having been acquired or contracted to be acquired by the Offeror byvirtue of acceptances of the Offer; 2 in the event that the Offer constitutes a concentration with aCommunity dimension within the scope of Council Regulation (EC) 139/2004 (the "Regulation"): 2.1 the European Commission having confirmed, in terms satisfactory to theOfferor, that it does not intend to initiate proceedings under Article 6(1)(c)of the Regulation in respect of the Offer or any aspect of the Offer; 2.2 in the event that a request under Article 9(2) of the Regulation has beenmade by a European Union or EFTA state, either: 2.2.2 the European Commission having confirmed, in terms satisfactory to theOfferor, that it does not intend to refer the Offer or any aspect of the Offerto the competent authorities of such a European Union or EFTA state inaccordance with Article 9(3) of the Regulation; or 2.2.2 in the event the European Commission, in accordance with Article 9(3) ofthe Regulation, refers the Offer or any aspect of the Offer to the competentauthorities of such a European Union or EFTA state, that competent authorityindicating, in terms satisfactory to the Offeror, that it does not intend toinitiate second phase proceedings (as provided for under the national laws ofthe relevant European Union or EFTA state) in respect of the Offer or any aspectof the Offer; 3 all required filings having been made under the United StatesHart-Scott-Rodino Antitrust Improvements Act of 1976 (as amended) and the rulesand regulations thereunder and all applicable waiting periods having expired orbeen terminated as appropriate, in each case in connection with the Offer or anyaspect of the Offer; 4 to the extent that the Offer constitutes a concentration or isotherwise subject to merger control approval in any jurisdiction not mentionedin Conditions 2 or 3 above and the approval of the competent agency in thatjurisdiction is required before the Offeror can consummate the Offer, thereceipt of evidence, in a form and substance satisfactory to the Offeror, thatin relation to the Offer and the acquisition of any shares in, or control of,the Offeree by the Offeror or any member of the Offeror's Group, all or anyapplicable waiting and/or other time periods have expired, lapsed or beenterminated and any approvals have been obtained, unconditionally or, if subjectto conditions, on terms satisfactory to the Offeror; 5 no central bank, government or governmental, quasi-governmental,supranational, statutory, regulatory or investigative body, trade agency, court,professional association, or any other such body or person in any jurisdiction(each a "Third Party") having given notice of a decision to take, institute orthreaten any action, proceeding, suit, investigation, enquiry or reference, orhaving required any action to be taken, or otherwise having done anything, orhaving enacted, made or proposed any statute, regulation, decision or orderwhich would: 5.1 make the Offer, its implementation or the acquisition or proposedacquisition of any BPB Shares by the Offeror or any member of the Wider OfferorGroup void, unenforceable or illegal, or restrict, prohibit or delay to amaterial extent or otherwise materially interfere with the implementation of, orimpose material additional conditions or obligations with respect to, orotherwise materially challenge or require material amendment of, the Offer orthe acquisition of any BPB Shares by the Offeror; 5.2 result in a material delay in the ability of the Offeror, or render theOfferor unable, to acquire some or all of the BPB Shares or require adivestiture by the Offeror or any member of the Wider Offeror Group of any BPBShares; 5.3 require, prevent or delay the divestiture, or alter the terms envisagedfor any proposed divestiture, by the Offeror or any member of the Wider OfferorGroup or by any member of the Wider BPB Group of all or any part of theirrespective businesses, assets or properties, or impose any limitation on theirability to conduct their respective businesses (or any of them) or to own theirrespective assets or properties or any part of them, to an extent in any suchcase which is material in the context of the Offer; 5.4 impose any limitation on, or result in a material delay in, the abilityof the Offeror or any member of the Wider Offeror Group to acquire or to hold orto exercise effectively, directly or indirectly, all rights of ownership ofshares, loans or other securities (or the equivalent) in BPB or the ability ofany member of the Wider BPB Group or the Offeror to hold or exercise effectivelyany rights of ownership of shares, loans or other securities in or in anyrespect which is material in the context of the Wider BPB Group to exercisemanagement control over any member of the Wider BPB Group; 5.5 save pursuant to the Offer or to Part XIIIA of the Companies Act,require any member of the Wider Offeror Group or of the Wider BPB Group toacquire or offer to acquire any shares or other securities (or the equivalent)in, or any asset owned by, any member of the Wider BPB Group owned by any thirdparty; 5.6 result in any member of the Wider BPB Group ceasing to be able to carryon business under any name which it presently does so, the consequences of whichwould be material in the context of the Wider BPB Group; 5.7 impose any limitation that is material in the context of the business ofthe Wider BPB Group on the ability of any member of the Wider Offeror Group orthe Wider BPB Group to integrate or co-ordinate the business of any member ofthe Wider BPB Group, or any part of it, with that of any member(s) of the WiderOfferor Group and/or any other member of the Wider BPB Group; 5.8 otherwise adversely affect the business, assets, liabilities, or profitsor prospects of any member of the Wider Offeror Group or of the Wider BPB Group,to an extent in any such case which is material in the context of the Wider BPBGroup taken as a whole, and all applicable waiting and other time periods duringwhich any such Third Party could take, institute or threaten any such action,proceeding, suit, investigation, enquiry or reference or otherwise so intervenehaving expired, lapsed or been terminated; 6 all necessary material notifications and filings having beenmade in connection with the Offer and all statutory and regulatory obligationsin connection with the Offer in any jurisdiction having been complied with andall material authorisations, orders, recognitions, grants, consents, clearances,confirmations, certificates, licences, permissions and approvals ("Authorisations") deemed reasonably necessary or appropriate by the Offeror inany jurisdiction for, or in respect of, the Offer and the acquisition or theproposed acquisition of the BPB Shares by the Offeror or any member of theOfferor Group having been obtained in terms reasonably satisfactory to theOfferor from all appropriate Third Parties, all or any applicable waiting andother time periods have expired, lapsed or been terminated (as appropriate) andall such Authorisations (together with all material Authorisations deemedreasonably necessary or appropriate to carry on the business of any member ofthe Wider BPB Group) remaining in full force and effect at the time at which theOffer becomes otherwise unconditional and there being no notice of any intentionto revoke, suspend, restrict, amend or not to renew any such Authorisations; 7 save as publicly announced by BPB prior to the date of thisannouncement, there being no provision of any arrangement, agreement, lease,licence, permit or other instrument to which any member of the Wider BPB Groupis a party or by or to which any such member or any of its assets is or may bebound or be subject, which as a consequence of the Offer or the acquisition orthe proposed acquisition by the Offeror or any member of the Wider Offeror Groupof any shares or other securities (or the equivalent) in BPB or because of achange in the control or management of any member of the Wider BPB Group orotherwise, would result in: 7.1 any monies borrowed by, or any other indebtedness, actual or contingent,of, any member of the Wider BPB Group being or becoming repayable, or beingcapable of being declared repayable immediately or prior to their or its statedmaturity, or the ability of any such member to borrow monies or incur anyindebtedness being withdrawn or inhibited; 7.2 the creation or enforcement of any mortgage, charge or other securityinterest, over the whole or any part of the business, property or assets of anymember of the Wider BPB Group or any such mortgage, charge or other securityinterest (whenever arising or having arisen) becoming enforceable; 7.3 any such arrangement, agreement, lease, licence, permit or otherinstrument being terminated or adversely modified or affected or any onerousobligation or liability arising or any adverse action being taken thereunder; 7.4 (other than in the ordinary course of business) any assets or interestsof any member of the Wider BPB Group being or falling to be disposed of orcharged or any right arising under which any such asset or interest could berequired to be disposed of or charged; 7.5 any such member of the Wider BPB Group ceasing to be able to carry onbusiness under any name under which it presently does so; or 7.6 the value or financial or trading position, profits or prospects of BPBor any member of the Wider BPB Group being prejudiced or adversely affected; or 7.7 the creation of any liability (actual or contingent) by any member ofthe Wider BPB Group, in each case, to an extent which is material in the contextof the Wider BPB Group taken as a whole; 8 save as disclosed in the Annual Report, publicly announcedthrough a Regulatory Information Service prior to the date of this announcement,no member of the Wider BPB Group having since 18 May 2005: 8.1 issued or agreed to issue or authorised or proposed or announced itsintention to authorise or propose the issue of additional shares of any class,or securities convertible into, or exchangeable for, or rights, warrants oroptions to subscribe for or acquire, any such shares or convertible securities(save as between BPB and wholly-owned subsidiaries of BPB and save for the issueof BPB Shares to employees on the exercise of options granted under, or thegrant of options under, the BPB Share Option Schemes); 8.2 recommended, declared, paid or made or proposed to recommend, declare,pay or make any bonus issue, dividend or other distribution whether payable incash or otherwise other than dividends (or other distributions whether payablein cash or otherwise) lawfully paid or made to another member of the BPB Group; 8.3 (save for intra-BPB Group transactions) implemented, effected,authorised, proposed or announced its intention to implement, effect, authoriseor propose any merger, demerger, reconstruction, amalgamation, scheme,commitment or acquisition or disposal of assets or shares (or the equivalentthereof) in any undertaking or undertakings that is material in the context ofthe BPB Group taken as a whole or any change in its share or loan capital; 8.4 (save for intra-BPB Group transactions) disposed of, or transferred,mortgaged or created any security interest over any asset or any right, title orinterest in any asset that is material in the context of the BPB Group taken asa whole or authorised, proposed or announced any intention to do so; 8.5 (save for intra-BPB Group transactions) issued, authorised or proposedor announced an intention to authorise or propose, the issue of any debenturesor (save for intra-BPB Group transactions or transactions under existing creditarrangements) incurred any indebtedness or contingent liability which ismaterial in the context of the BPB Group as a whole; 8.6 entered into or varied or authorised, proposed or announced itsintention to enter into or vary any contract, arrangement, agreement,transaction or commitment (whether in respect of capital expenditure orotherwise) which is of a long term, unusual or onerous nature or magnitude orwhich involves or is reasonably likely to involve an obligation of such a natureor magnitude which is, in any such case, or which is or is likely to berestrictive on the business of any member of the Wider BPB Group, which is, inany such case, material in the context of the Wider BPB Group; 8.7 entered into or varied to a material extent or authorised, proposed orannounced its intention to enter into or vary to a material extent the terms of,or make any offer (which remains open for acceptance) to enter into or vary to amaterial extent the terms of, any service agreement with any director or, savefor salary increases, bonuses or variations of terms in the ordinary course,senior executive of BPB; 8.8 purchased, redeemed or repaid or announced a proposal to purchase,redeem or repay any of its own shares or other securities (or the equivalent) orreduced or made any other change to or proposed the reduction or other change toany part of its share capital, save for any shares allotted upon the exercise ofoptions granted under the BPB Share Option Schemes or as between BPB andwholly-owned subsidiaries of BPB; 8.9 waived, compromised or settled any claim which is material in thecontext of the BPB Group as a whole; 8.10 terminated or varied the terms of any agreement or arrangement between anymember of the BPB Group and any other person in a manner which would or mightreasonably be expected to have a material adverse effect on the financialposition or prospects of the BPB Group taken as a whole; 8.11 (save as disclosed on publicly available registers) made any alteration toits memorandum or articles of association; 8.12 made or agreed or consented to any significant change to the terms of thetrust deeds constituting the pension schemes established for its directors and/or employees and/or their dependants or to the benefits which accrue, or to thepensions which are payable, thereunder, or to the basis on which qualificationfor or accrual or entitlement to such benefits or pensions are calculated ordetermined or to the basis upon which the liabilities (including pensions) ofsuch pension schemes are funded or made, or agreed or consented to any change tothe trustees involving the appointment of a trust corporation; 8.13 been unable, or admitted in writing that it is unable, to pay its debts orhaving 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 any business which is material in the context of the BPBGroup as a whole; 8.14 (other than in respect of a member which is dormant and was solvent at therelevant time) taken or proposed any corporate action or had any action orproceedings or other steps instituted against it for its winding-up (voluntaryor otherwise), dissolution or reorganisation or for the appointment of areceiver, administrator, administrative receiver, trustee or similar officer ofall or any material part of its assets or revenues or any analogous proceedingsin any jurisdiction or appointed any analogous person in any jurisdiction; or 8.15 entered into any agreement, arrangement or commitment or passed anyresolution or made any proposal or announcement with respect to, or to effect,any of the transactions, matters or events referred to in this Condition 8; 9 since 18 May 2005, save as disclosed in the Annual Report, orexcept as publicly announced by BPB (by the delivery of an announcement to aRegulatory Information Service), in each case prior to the date of thisannouncement, there having been: 9.1 no material adverse change in the business, assets, financial or tradingposition or profits or prospects of any member of the Wider BPB Group; or 9.2 no litigation, arbitration proceedings, prosecution or other legalproceedings having been announced or instituted by or against or remainingoutstanding against or in respect of any member of the Wider BPB Group and noenquiry or investigation by or complaint or reference to any Third Party againstor in respect of any member of the Wider BPB Group having been threatened,announced or instituted or remaining outstanding, against or in respect of anymember of the Wider BPB Group and which in any such case might reasonably beexpected to adversely affect any member of the Wider BPB Group; or 9.3 no contingent or other liability having arisen or become apparent to anymember of the Wider Offeror Group which might reasonably be expected toadversely affect any member of the Wider BPB Group; 10 save as publicly announced by the delivery of an announcement to aRegulatory Information Service prior to the date of this announcement or asotherwise disclosed in the Annual Report, the Offeror not having discovered: 10.1 that the financial, business or other information concerning the Wider BPBGroup publicly announced or disclosed at any time by or on behalf of any memberof the Wider BPB Group is misleading, contains a misrepresentation of fact oromits to state a fact necessary to make the information contained therein notmisleading and which is, in any case, material in the context of the Wider BPBGroup; or 10.2 that any member of the Wider BPB Group or partnership, company or otherentity in which any member of the Wider BPB Group has a significant economicinterest and which is not a subsidiary undertaking of BPB is subject to anyliability, contingent or otherwise, which is material in the context of theWider BPB Group taken as a whole; and 11 in relation to any release, emission, discharge, disposal or otherfact or circumstance which causes or might reasonably be expected to causepollution of the environment or harm to human health, no past or present memberof the Wider BPB Group having, in any manner or to an extent which is materialin the context of the Wider BPB Group (i) committed any violation of any laws,statutes, ordinances or regulations of any Third Party and/or (ii) incurred anyliability (whether actual or contingent) with respect thereto. For the purposes of the Conditions set out in this Appendix 1: (i) "parent undertaking", "subsidiary undertaking", "associated undertaking" and "undertaking" have the meanings given by the Companies Act 1985, but forthis purpose ignoring paragraph 20(1)(b) of Schedule 4A of the Companies Act1985; and (ii) "substantial interest" means a direct or indirect interest in 20 percent. or more of the voting equity capital of an undertaking. The Offeror reserves the right to waive, in whole or in part, all or any of theabove Conditions 2 to 11. If the Offeror is required by the Panel to make an offer for BPB Shares underthe provisions of Rule 9 of the Code, the Offeror may make such alterations toany of the above conditions including Condition 1 above, as are necessary tocomply with the provisions of that Rule. The Offer will lapse unless all of the conditions set out above have beenfulfilled or, where permitted, waived or, where appropriate, have beendetermined by the Offeror to be or remain satisfied, by midnight on the 21st dayafter the later of the first closing date of the Offer and the date on whichCondition 1 is fulfilled (or in each case such later date as the Offeror may,with the consent of the Panel, decide). The Offeror shall be under noobligation to waive (if capable of waiver), to determine to be or remainsatisfied or to treat as fulfilled any of Conditions 2 to 11 (inclusive) by adate earlier than the latest date specified above for the fulfilment of thatcondition. The Offer will lapse (unless otherwise agreed by the Panel) if, before the laterof 3.00 p.m. on the first closing date of the Offer and the date when the Offerbecomes or is declared unconditional as to acceptances: (i) the European Commission initiates proceedings under Article 6(1)(c) ofCouncil Regulation (EC) 139/2004 (the "Regulation"); or (ii) following a referral by the European Commission under Article 9.1 of theRegulation to a competent authority in the United Kingdom, there is a subsequentreference to the Competition Commission. If the Offer so lapses, the Offer will cease to be capable of further acceptanceand accepting BPB Shareholders and the Offeror shall cease to be bound by Formof Acceptance submitted before the time when the Offer lapses. APPENDIX II DEFINITIONS The following definitions apply throughout this announcement, unless the contextrequires otherwise. "Annual Report" the annual report and accounts of BPB for the year ended 31 March 2005 "Authorisations" has the meaning given to it in condition 6 of Appendix I "BNP Paribas" BNP Paribas S.A. "Board of BPB" the board of directors of BPB "BPB" BPB PLC "BPB Group" BPB and its subsidiaries and subsidiary undertakings "BPB Shareholders" holders of BPB Shares "BPB Shares" the existing unconditionally allotted or issued and fully paid (or credited as fully paid) ordinary shares of 50 pence each in the capital of BPB and any further such shares which may be issued or unconditionally allotted (including pursuant to the exercise of options granted prior to the date hereof under the BPB Share Schemes) prior to the date on which the Offer closes or, subject to the provisions of the City Code, by such earlier date as the Offeror may decide "BPB Share Option Schemes" the employee share plans operated by BPB relating to BPB Shares "Business Day" a day, not being a public holiday, Saturday or Sunday, on which clearing banks in London are open for normal business "Closing Price" the closing quotation of a share derived from the Daily Official List "City Code"or "Code" the City Code on Takeovers and Mergers "Companies Act" the Companies Act 1985 (as amended) "Credit Facilities Agreement" the agreement dated 3 August 2005 between amongst others Saint-Gobain and, as mandated lead arrangers, BNP Paribas and UBS Limited under which the new facilities to satisfy the cash consideration under the Offer will be provided by BNP Paribas and UBS Limited "Daily Official List" the Daily Official List of the London Stock Exchange "EBITDA" earnings before interest, tax, depreciation and amortisation "Enlarged Group" Saint-Gobain, its subsidiaries and its subsidiary undertakings, following the Offer being declared unconditional in all respects "Form of Acceptance" the form of acceptance, election and authority relating to the Offer which will accompany the Offer Document "London Stock Exchange" London Stock Exchange plc "Majority Lenders" those lenders at any time whose commitments under the Credit Facilities Agreement aggregate more than 66.66 per cent. of the total commitments under the Credit Facilities Agreement "Offer" the cash offer to be made by BNP Paribas and UBS on behalf of the Offeror outside the US and by the Offeror in the US, to acquire the BPB Shares on the terms and subject to the conditions to be set out in the Offer Document and the Form of Acceptance including, where the context so requires, any subsequent revision, variation, extension or renewal of such offer "Offer Document" the document containing the terms and conditions of the Offer and, where appropriate, any other document(s) containing terms and conditions of the Offer constituting the full terms and conditions of the Offer "Offeror" Saint-Gobain Aldwych Limited, a wholly-owned subsidiary of Saint-Gobain, which is incorporated in England and Wales "Offeror Group" the Offeror and its subsidiaries and subsidiary undertakings "Offer Period" the period beginning on and including 21 July 2005 and ending on the latest of: (i) the first closingRelated Shares:
Saint Gobain Or