18th Jul 2007 07:01
Trace Group PLC18 July 2007 18 July 2007 NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION IN, INTO OR FROM THE UNITED STATES,CANADA, AUSTRALIA OR JAPAN Trace Group plc("Trace" or the "Company") Response of Trace to the Revised Cash Offer from Tulip Holdings Limited ("Tulip") The Company announces that it is today sending a document to Trace Shareholdersin response to the revised cash offer from Tulip in which Daniel Chapchal,Chairman, on behalf of the Trace Independent Directors (being Mr. DanielChapchal, Professor David Begg, Mr. Colin Clarke and Mr. Robin Woodall) hasstated as follows: "I am writing to you, on behalf of the Trace Independent Directors, in responseto Tulip's revised offer document and to outline our reasons for recommendingthat you reject Tulip's revised cash offer of 156 pence per Trace Share (the "Tulip Revised Offer"). As you are aware, the Trace Independent Directors havegiven their recommendation to the increased cash offer of 180 pence per TraceShare (the "Recommended Increased Offer") from Microgen plc ("Microgen"). Ourposition with regard to the Recommended Increased Offer from Microgen remainsunchanged. In order to facilitate an understanding of our position, I would first like toset out the sequence of events that has taken place over the last few months: • On 20 April 2007, the Board of Tulip and the Trace Independent Directors announced that they had reached agreement on the terms of a recommended proposal for the acquisition of Trace by Tulip at a price of 135 pence in cash per Trace Share. • On 25 May 2007, the Board of Microgen and the Trace Independent Directors announced the terms of a recommended cash offer of 155 pence per Trace Share, as subsequently made by Microgen in its offer document posted on 1 June 2007, for the entire issued and to be issued ordinary share capital of Trace. • On 13 June 2007, Tulip announced its revised offer of 156 pence in cash per Trace Share, as subsequently made by Tulip in its offer document posted on 10 July 2007. • On 15 June 2007, the Board of Microgen and the Trace Independent Directors announced that they had agreed the terms of a recommended increased cash offer of 180 pence per Trace Share, as subsequently made by Microgen in its offer document posted on 20 June 2007. The Tulip Revised Offer has not been recommended by the Trace IndependentDirectors and the position of the Trace Independent Directors remains unchangedwith regard to the Recommended Increased Offer from Microgen. TraceShareholders should be aware that the Recommended Increased Offer from Microgenof 180 pence in cash per Trace Share is 24 pence per share greater than theTulip Revised Offer of 156 pence in cash per Trace Share, representing asubstantial premium of 15.4 per cent. When considering its decision to recommend Microgen's increased offer of 180pence in cash per Trace Share, the Trace Independent Directors were givenassurances by the Board of Microgen that, following the Recommended IncreasedOffer from Microgen becoming or being declared unconditional in all respects,the existing contractual and statutory employment rights, including pensionrights, of the directors, management and employees of Trace would be fullysafeguarded. Microgen has also stated that, in the event that Microgen acquiressufficient shares in Trace to cancel Trace's listing on the Official List (thatis to say greater than 75 per cent of the voting share capital of Trace), Traceemployees will be given the opportunity, should they so wish, to transfer ontoMicrogen's standard terms and conditions of employment which will provideemployees with salaries, profit share, bonus schemes, share option plans andother benefits in line with existing Microgen staff. Trace Shareholders should also be aware that Microgen has acquired 3,680,000Trace Shares, representing approximately 25.83 per cent of the Trace Shares. Microgen announced on 16 July 2007, the second closing date of its RecommendedIncreased Offer, that it had received valid acceptances in respect of 2,507,002Trace Shares, representing approximately 17.59 per cent of the Trace Shares. The valid acceptances include 1,127,880 Trace Shares, representing approximately7.92 per cent of the Trace Shares, received pursuant to an irrevocablecommitment from Herald Investment Management Limited and 10,000 Trace Shares,representing approximately 0.07 per cent of the Trace Shares, received pursuantto an undertaking from me to procure acceptance of the Recommended IncreasedOffer from Microgen of the Trace Shares held in my SIPP. In addition, Microgenhas also received an undertaking to accept its Recommended Increased Offer fromColin Clarke, one of the Trace Independent Directors, in respect of the1,426,453 Trace Shares (representing 10.01 per cent of the Trace Shares) ownedby him and his connected parties upon the lapsing of his existing irrevocablecommitment to the Tulip Revised Offer. Such lapsing will occur in the event thatthe Tulip Revised Offer lapses or is withdrawn. Therefore, on 16 July 2007,Microgen announced that, in aggregate, it owned or had received validacceptances in respect of a total of 6,187,002 Trace Shares, representingapproximately 43.42 per cent of the Trace Shares which it is entitled to counttowards the satisfaction of the acceptance condition under its RecommendedIncreased Offer. The Recommended Increased Offer from Microgen of 180 pence in cash per TraceShare is 24 pence per share greater than the Tulip Revised Offer of 156 pence incash per Trace Share, representing a substantial premium of 15.4 per cent. TheTrace Independent Directors, who have been so advised by Shore Capital andCorporate Limited, consider the terms of the Recommended Increased Offer fromMicrogen to be fair and reasonable. In providing advice to the Trace IndependentDirectors, Shore Capital and Corporate Limited has taken into account the TraceIndependent Directors' commercial assessments. Accordingly the Trace Independent Directors unanimously urge Trace Shareholdersnot to accept the Tulip Revised Offer and they recommend that all TraceShareholders accept the Recommended Increased Offer from Microgen." Press Enquiries: Trace Group plc Telephone: +44 (0) 20 7825 1000Daniel ChapchalDavid Begg Shore Capital and Corporate Limited Telephone: +44 (0) 20 7408 4090(Financial adviser to Trace)Alex BorrelliPascal Keane Shore Capital and Corporate Limited, which is authorised and regulated in theUnited Kingdom by the Financial Services Authority, is acting exclusively forTrace Group plc and no one else in connection with the Recommended IncreasedOffer and will not be responsible to anyone other than Trace Group plc forproviding the protections afforded to clients of Shore Capital and CorporateLimited nor for providing advice in relation to the Recommended Increased Offer,or the contents of this announcement or any matter referred to herein. Dealing disclosure requirements Under the provisions of Rule 8.3 of the Takeover Code (the "Code"), if anyperson is, or becomes, "interested" (directly or indirectly) in 1% or more ofany class of "relevant securities" of Trace, all "dealings" in any "relevantsecurities" of that company (including by means of an option in respect of, or aderivative referenced to, any such "relevant securities") must be publiclydisclosed by no later than 3.30 pm (London time) on the London business dayfollowing the date of the relevant transaction. This requirement will continueuntil the date on which the Recommended Increased Offer becomes, or is declared,unconditional as to acceptance, lapses or is otherwise withdrawn or on which 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 Trace they will be deemed to be a singleperson for the purpose of Rule 8.3 of the Code. Under the provisions of Rule 8.1 of the Code, all "dealings" in "relevantsecurities" of Trace by Microgen or Tulip or Trace or by any of their respective"associates" must be disclosed by no later than 12.00 noon (London time) on theLondon business day 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 ofsecurities. 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 reference to, securities. Terms in quotation marks are defined in the Code, which can also be found on thePanel's website. If you are in any doubt as to whether or not you are requiredto disclose a "dealing" under Rule 8, you should consult the Panel. This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
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