28th Nov 2007 09:50
Naarden, 28 November 2007 Press release
This is a joint press release of Stork N.V. and London Acquisition B.V. pursuant to the provisions of
Section 5, subsection 1, of the Dutch Decree on Public Offers (Besluit openbarebiedingen Wft). This is not a public announcement that a public offer is to bemade, but that conditional agreement has been reached on the terms andconditions of an offer agreement. Not for release, distribution or publication,in whole or in part, in the United States of America, Japan or Canada.
Intended recommended cash offer of EUR 48.40 per share for Stork
Sale of Stork Food Systems Highlights* London Acquisition B.V. ("the Offeror"), a holding company controlled by aconsortium of funds managed and advised by, or affiliated with, Candover ,Landsbanki Islands hf ("Landsbanki") and Eyrir Invest hf ("Eyrir"), intends tomake a recommended cash offer (the "Intended Offer") of EUR 48.40 (the "OfferPrice") per ordinary share in Stork N.V. ("Stork" or the "Company") whichrepresents a value of approximately EUR 1.5 billion;
* As an integral and inseparable part of the Intended Offer, Stork will sell its Food Systems division to Marel Food Systems hf ("Marel") for a purchase price of EUR 415 mln on a cash and debt free basis;
* The Supervisory Board, including the court appointed Extraordinary Supervisory Board members, and the Management Board of Stork fully and unanimously support and recommend the Intended Offer;
* The Stork Central Works Council has been informed and requested to review the Intended Offer;
* Stork's indirect shareholder LME eignarhaldsfĩlag ehf("LME"), beneficially owned by Eyrir Invest and Landsbanki, which owns approximately 43% of the issued ordinary share capital of Stork, has expressed its support for the Intended Offer and will, subject to the Offer having been declared unconditional, transfer part of its shares to London Acquisition and will tender the other part under the Intended Offer;
* Stork's shareholders Centaurus Capital Limited ("Centaurus") and Paulson &Co Inc. ("Paulson") have irrevocably committed to tender shares representingapproximately 33% of the issued shares in Stork under the Intended Offer, whenmade;
* All existing rights of the employees will be respected. There will be no direct negative consequences for the existing employment level of Stork as a result of the Intended Offer or the sale of Stork Food Systems.
Stork and the Offeror, a holding company incorporated in the Netherlands,jointly announce that conditional agreement has been reached between Stork andthe Offeror in connection with a public offer by the Offeror for all of theissued and outstanding ordinary share capital of Stork at an offer price of EUR48.40 in cash per ordinary share. The Offer Price is cum-dividend, whichreflects that Stork has committed not to declare any dividends or distributionson its shares prior to the settlement of the Intended Offer. The Offeror isaffiliated with and controlled by funds managed and advised by Candover. Eyrirand Landsbanki together will become shareholders in the Offeror. In addition, Stork and Marel jointly announce that, as an integral andinseparable part of the Intended Offer, they have reached agreement on the saleand purchase of Stork Food Systems at a purchase price of EUR 415 mln on a cashand debt free basis. As soon as possible after the Intended Offer has beendeclared unconditional, the sale of Stork Food Systems to Marel will beimplemented. The Supervisory Board, including the Extraordinary Supervisory Board membersappointed by the Enterprise Chamber of the Court of Appeals in Amsterdam, andthe Management Board of Stork conclude that, after giving consideration to thestrategic, financial and social aspects of the proposed transactions, theIntended Offer is in the best interest of its shareholders and otherstakeholders. They fully and unanimously support the Intended Offer andrecommend that shareholders tender their shares under the Intended Offer, whenmade.
Jan Kalff, Chairman of the Supervisory Board of Stork:
"I am delighted that after two months of intensive and constructive discussions we have been able to reach agreement with Candover, LME, and Centaurus &
Paulson on an offer for all Stork shares, allowing the company to get out ofthe current deadlock. Stork Food Systems can look forward to a good future withMarel, whilst Candover will take Stork to the next phase in its development"The Intended Offer is an all-cash offer for all of the issued and outstandingordinary share capital of Stork. Based on the Offer Price of EUR 48.40 perordinary share, the Intended Offer is valued at approximately EUR 1.5 billion.The Offer Price represents:
* a premium of 15% relative to the closing share price of EUR 42.21 of an ordinary share on 18 June 2007, the last trading day prior to 19 June 2007, the day on which Stork first announced that it was in discussions with Candover regarding a possible offer;
* a premium of 23% relative to the average closing price of an ordinary shareduring the last three months prior to to 19 June 2007, the day on which Storkfirst announced that it was in discussions with Candover regarding a possibleoffer;
* a premium of 9% relative to the closing share price of EUR 44.55 of an ordinary share on 27 November 2007, the last trading day prior to 28 November 2007, the date of this press release;
The aggregate value of the proposed transaction is approximately EUR 1.6 billion, including net financial indebtedness. This implies a multiple of approximately 10 times 2006 normalised EBITDA (EUR 162 million).
The Intended Offer will have a number of advantages for Stork, its shareholders, employees, customers and other stakeholders:
* The proposed transaction creates a more stable environment for the Company.It will enable management to focus on the daily business again and will createmore certainty for employees and customers;
* The Intended Offer enables current shareholders to realise certain and immediate value in cash for their shares at an attractive price.
* Candover has extensive experience and a strong track record in the industrial sector and has the resources to support management teams in growing their businesses;
* The Offeror supports management's strategy of growing the remaining businesses autonomously and by selective acquisitions;
* The Offeror has addressed criteria of the Supervisory Board to structure thefinancial leverage in such a way, that it provides the financial flexibilityneeded for growth in the next stage of the development of the Company;
Sjoerd Vollebregt, CEO of Stork, said:
"The situation around Stork became more and more complex. I'm pleased that wejointly succeeded to find a solution that is realistic and feasible. This offeras well as the subsequent sale of Food Systems to a well known and reputablestrategic buyer will put an end the turbulent situation in which the companyhas found itself for almost two years."
Marek Gumienny, Managing Director of Candover, said:
"We are delighted that we have been able to reach an agreement that will allowus to push ahead with our plans to invest in Stork - a company with greatbusinesses and strong positions in growth markets. We believe this is the bestway forward to end what has been a prolonged period of uncertainty for thebusiness and all its stakeholders. We believe that under our proposed dealStork will remain well positioned to take advantage of its existing strengthsand future opportunities." Social aspects
The Offeror supports Stork's growth strategy. The Intended Offer as such is notexpected to adversely affect the existing employment level and employmentconditions of Stork other than a limited number of redundancies at Storkholding level as a direct result of the delisting of Stork. The Offeror will,if and when the Intended Offer is made and declared unconditional, respect allexisting rights of the employees of the Company. The Offeror has agreed that itwill comply with the regulations with respect to the employee co-determinationregulations (medezeggenschap), as well as the arrangements entered into byStork and the unions, including the existing social plans and collective labouragreements. In addition the Offeror will respect the existing obligationsregarding pension rights of Stork's employees. The Offeror shall have discussions with Stork's Central Works Council to assistStork in obtaining a Central Works Council's advice. The Offeror will support,that in connection with this advice process, the undertakings set out abovewill be laid down in a covenant to be entered into with Stork's Central WorksCouncil.
Stork will continue to operate as an independent entity
The present members of the Management Board will stay in office. As iscustomary in this type of transaction, members of the senior management teamwill be invited after settlement of the Intended Offer to invest in the companyalongside the funds managed and advised by or affiliated with Candover, EyrirInvest and Landsbanki. If the Intended Offer is declared unconditional, the present Supervisory Boardmembers will resign and new Supervisory Board members will be appointed. Thenew Supervisory Board will initially comprise of five members, with anindependent chairman and one member nominated by the Central Works Council.After Settlement of the Offer, one additional person shall be nominated by theSupervisory Board forappointment by the first general meeting of shareholders to be held afterSettlement. This person shall be nominated upon recommendation by the CentralWorks Council of Stork and shall be deemed to be independent (as such notion isdescribed in the Dutch corporate governance rules). If the Intended Offer is declared unconditional, it is intended that Stork'slisting on the Official Market of Euronext Amsterdam N.V. will be terminated assoon as possible. Furthermore, London Acquisition expects to apply legalpossibilities contemplated by the Dutch Civil Code in order to acquire allshares by minority shareholders, in the event it acquires 95% of the shares, ortake such other steps to terminate the listing and/or acquire shares not beingtendered, including effecting a legal merger (juridische fusie).
Irrevocable undertakings from LME, Centaurus & Paulson, and Stork management
Stork's shareholder LME holding indirectly 13,617,690 shares representingapproximately 43% of the issued share capital, supports the Intended Offer. LMEwill, subject to the Offer having been declared unconditional, transfer part ofits shares to London Acquisition and will tender the other part under theIntended Offer.
Stork's shareholders, Centaurus and Paulson have irrevocably undertaken to tender shares representing approximately 33% of the issued share capital of Stork under the Intended Offer, if the Intended Offer is made.
In addition, Messrs. Vollebregt, SchĦnfeld, Bouland and Van den Driest, membersof Stork's Management Board and Supervisory Board, have irrevocably undertakento tender their shares under the Intended Offer, if the Intended Offer is made.None of the other board members own Stork shares.
Thus the aggregate number of shares in Stork committed to the Offeror represents approximately 77% of Stork's issued and outstanding share capital.
Procedure Enterprise Chamber
Provided the Intended Offer is declared unconditional and settled, Centaurusand Paulson will support a request to the Enterprise Chamber of the Court ofAppeals that the enquiry initiated by the Enterprise Chamber into the affairsof Stork (enquĻteverzoek) should be terminated.
Kees van Lede, Extraordinary Supervisory Board member of Stork, said:
"The Extraordinary Supervisory Board members welcome the intended offer announced today and the commitment of major shareholders to tender their shares. This offer has been made possible by a constructive dialogue between all parties involved. The proposed outcome is in the best interest of all stakeholders of Stork: shareholders, customers and employees alike."
Conditions precedent to making the Intended Offer and declaring it unconditional
As conditions precedent to making the Intended Offer and declaring itunconditional, the customary conditions for this kind of transactions willapply. Amongst these will be regulatory approvals, the continuation of certaincontracts relating to Stork's business in view of change of control provisionsand the condition that at least 95% of the issued and outstanding share capitalof Stork has been tendered under the Intended Offer, which condition may bewaived by the Offeror as it deems appropriate in case less than 95% but morethan 80% of the issued and outstanding share capital of Stork has been tenderedunder the Intended Offer. In addition, the Intended Offer is conditional on theirrevocable undertakings by Centaurus, Paulson and LME and the sale andpurchase agreement relating to the sale of Stork Food Systems not having beenterminated. Saleof Stork Food SystemsThe sale of Stork Food Systems is an integral and inseparable part of theIntended Offer. In case the Intended Offer would not be made, or declaredunconditional, the sale and purchase agreement relating to Stork Food Systemswill terminate. In addition, customary conditions for this kind of transactionswill apply. Amongst these will be Stork shareholders approval, regulatoryapprovals and Central Works Council advice being obtained. Stork will askapproval for the sale of SFS from its shareholders at the extraordinaryshareholders meeting that will be held in connection with the Intended Offer,when made. Marel supports the strategy of Stork Food Systems. The sale of Stork FoodSystems as such is not expected to adversely affect the existing employmentlevel and employment conditions of Stork Food Systems. Marel will respect allexisting rights of the employees of Stork Food Systems. Marel has agreed thatit will comply with the regulations with respect to the employeeco-determination regulations (medezeggenschap), as well as the arrangementsentered into by Stork and the unions, including the existing social plans andcollective labour agreements, with respect to Stork Food Systems. In additionMarel will respect the existing obligations regarding pension rights of theemployees of Stork Food Systems. In accordance with the procedure agreed with the Central Works Council, Storkand Marel shall - as part of the advice process outlined above - havediscussions with Stork's Central Works Council to obtain the Central WorksCouncil's advice on the sale of Stork Food Systems. Marel will support, that inconnection with this advice process, the undertakings set out above will belaid down in a covenant to be entered into with the Works Council of Stork
FoodSystems. Further stepsParties will take further steps in the coming weeks to finalize thedocumentation relating to the Intended Offer, subsequently the Offer will bemade and the offer memorandum will be published. It is currently expected thatthis will take place mid December 2007. The Netherlands Authority for the Financial Markets, Euronext Amsterdam N.V.,the Secretary of the Social Economic Council and the competent competitionauthorities and other relevant authorities such as the Committee of ForeignInvestment in the United States have been or will be informed of the IntendedOffer and, where relevant, will be requested to provide clearance in respect ofthe transaction. The Works Council of Stork has been notified and will be askedfor advice. Indicative timetablePublication of Offer Memorandum Mid December 2007
Extraordinary General Meeting of Shareholders End December 2007/
Early January 2008 Closing of the Intended Offer January 2008Closing of the sale of Stork Food Systems As soon as possible after the Closing of the Intended Offer AdvisorsABN Amro Bank N.V. is acting as financial adviser and De Brauw BlackstoneWestbroek N.V. is acting as legal adviser to Stork. Kempen & Co is acting asfinancial adviser and Nauta Dutilh and Stibbe as legal advisers to theSupervisory Board of Stork. Barons Financial Services and Goldman SachsInternational are acting as financial adviser and Clifford Chance is acting
aslegal adviser to the Offeror. Goldman Sachs International, which is regulated in the United Kingdom by theFinancial Services Authority, is acting for the Offeror and no one else inconnection with the Offer and will not be responsible to anyone other than theOfferor for providing the protections afforded to clients of Goldman SachsInternational nor for providing advice in connection with the Offer. Landsbanki Corporate Finance is acting as financial advisor and Allen & Overyis acting as legal advisor for LME and Marel. Landsbanki, which is regulated inIceland by the Icelandic Financial authority (FME), is acting for LME and Mareland no one else in connection with the Offer and will not be responsible toanyone other than LME and Marel for providing advice in connection with the
offer. About StorkStork supplies systems, components and services in which the specialised Storkknow¢â‚¬â€œhow in technology and production processes is applied. Its core activitiesare Aerospace, Food Systems and Technical Services.
Stork has a history of more than 180 years, making it one of the oldest industrial companies in the Netherlands. Its foundations are technological capability, innovation and professionalism. The company achieved a turnover of ¢â€š¬ 2 billion and a net result of ¢â€š¬ 150 million in 2006 with 12,714 employees.
About CandoverCandover is a leading provider of private equity for large European buyouts. Founded in 1980, Candover has invested in 134 transactions with a value of over¢â€š¬40 billion. Investment in deals by Candover is provided in two forms, fromCandover Investments plc, a publicly quoted investment trust, and from fundsmanaged by Candover Partners Limited, a wholly owned subsidiary. In November 2005, Candover raised the ¢â€š¬3.5bn Candover 2005 Fund which has madeeight investments to date: the buyout of Alma Consulting Group, the Europeanleader in cost reduction and tax recovery services, the $565m buyout of CapitalSafety Group, the leading global player in the fall protection market, thebuyout of Parques Reunidos, a leading operator of regional attraction parks,the buyout of Ferretti, a leading manufacturer of high performance luxury motoryachts, the ¢â€š¬1bn acquisition of Hilding Anders, a leading European mattress andbeds manufacturer, the acquisition of UK mail services company DX Services plcand merger with Secure Mail Services, the ¢â€š¬450 million buyout of Norwegiancable TV operator UPC Norway, and the ¢â€š¬480 million buyout of EurotaxGlass'sGroup, a leading provider of automotive data and intelligence services.
The Candover Group has four offices in London, Madrid, Milan and Paris. Candover Partners is authorised and regulated by the Financial Services Authority in the UK.
For more information, see www.candover.com.
About Landsbanki IslandsLandsbanki is a growing European bank with total assets of ISK 2,847 billion(EUR 32.4 bn) at 30 September 2007 and a market capitalisation of ISK 440billion (EUR 5.0 bn) at 14 November 2007. Through its extensive distributionnetwork of 2,499 employees in 17 countries including the Netherlands,Landsbanki is set to deliver targeted financial services based on localexpertise for mid-cap corporates in Europe. Landsbanki provides retail andcorporate banking, investment banking, capital markets services, assetmanagement and wealth management for private banking clients. Landsbanki'sunique product line includes access to both debt and equity markets and itsresearch department is among the most comprehensive in Europe, including some90 analysts covering close to 900 European stocks. Headquartered in Reykjavik, Iceland, Landsbanki Islands hf. is traded on theOMX Nordic Exchange Iceland under the symbol . Landsbanki is rated byMoody's (Aa3 / P-1 / C / Stable) and Fitch (A / F1 / B/C / Stable). About Eyrir Invest
Eyrir Invest is an international investment company where the main emphasis is on investments in listed companies in Europe.
Eyrir Invest's mission is to increase shareholders' value by active ownershipand trading of equities and other securities. Eyrir Invest places greatemphasis on participating in operations and strategic planning of the businessit invests in.
Eyrir Invest was founded in mid-year 2000 and has a proven track record. Eyrir Invest's "buy and build" strategy has since its foundation increased shareholders value well above its targeted annual return of 20%.
Eyrir Invest's total portfolio amounts to ¢â€š¬ 420 million. The company is financially solid and is equally funded through equity and other long-term financing.
About Marel Food Systems
Marel Food Systems is one of the world's leading innovators of high-tech equipment for the food processing industry.
Marel Food Systems provides advanced equipment to all segments of the foodprocessing industry, increasing the quality and value of fish, meat, poultryand other prepared food products around the world. The company's innovativesolutions - from single machines to turnkey processing plants - always resultin significant additional value for processors, retailers and end consumers.Marel Food Systems operates in 22 countries and has a network of agents anddistributors covering over 40 countries worldwide. The company stays on thecutting edge by investing far more than the industry average in research andproduct development.Marel Food Systems is one of the largest providers of food processing machinesand systems in the world. Marel Food Systems consists of four main businessunits that are complementary to each other: Marel ehf., in Iceland, AEWDelford Systems Ltd. in the UK, Carnitech A/S in Denmark and ScanvaegtInternational A/S in Denmark. Together the four brands supply a complete rangeof processing equipment to all sectors of the food processing industry.
This press release is also published in the Dutch language. In the event of any inconsistency, this English language version will prevail above the Dutch language version.
RestrictionsThe distribution of this communication may, in some countries, be restricted bylaw or regulation. Accordingly, persons who come into possession of thisdocument should inform themselves of and observe these restrictions. To thefullest extent permitted by applicable law, The Offeror and Stork disclaim anyresponsibility or liability for the violation of any such restrictions by anyperson. Any failure to comply with these restrictions may constitute aviolation of the securities laws of that jurisdiction. Neither the Offeror, norStork nor any of their advisers assumes any responsibility for any violation byany person of any of these restrictions. Any Stork shareholder who is in anydoubt as to his position should consult an appropriate professional adviser
without delay.
For further information please contact:
Stork N.V.:Dick KorsTel: +31 (0) 35 - 695 75 75Candover:Marek GumiennyTel: +44 (0) 20 7489 9848orTulchan CommunicationsSusanna Voyle, Peter HewerTel: +44 (0) 20 7353 4200 LME:
Van Luyken Communicatie Adviseurs
Attn. Jan Hendrik WiggersTel +31 (0) 653 325095 Marel Food Systems:Stella Bjƒ¶rg Kristinsdƒ³ttirPhone: +354-563-8205Mobile: +354-825-8205
E-mail: [email protected]
Conference call:
Conference call/ webcast analyst : 10.00 CET
Conference call/ webcast press : 11.00 CET
details on www.stork.com
Candover means Candover Investments plc and / or one or more of its subsidiaries, including Candover Partners Limited as Manager of the Candover 2005 Fund.
CANDOVER INVESTMENTS PLCRelated Shares:
CDI.L