12th Jul 2005 17:36
Regent Inns PLC12 July 2005 12 July 2005 Regent Inns plc ("Regent Inns" or "the Company") Update on offer discussions with Urbium plc The board of Regent Inns announces that it has this morning written to the Boardof Urbium plc ("Urbium") setting out the terms of a final* proposed offer ("theFinal* Offer") for the entire issued and to be issued share capital of Urbium.The Final* Offer will not be increased. The Final* Offer, if made, would be satisfied by the payment of 438.75 pence incash and the issue of 6.8312 new Regent shares in exchange for each Urbiumshare. Based on the mid-market closing price of 78.5 pence for a Regent share on11 July 2005, the Final* Offer values each Urbium share at 975 pence per share,with the cash consideration of 438.75 pence representing 45 per cent. of theoffer price and the share element valued at 536.25 pence representing 55 percent. of the value of the offer. A mix and match facility will also be providedto allow Urbium shareholders to elect to receive different proportions of cashand shares. Based on the mid-market closing price of 78.5 pence for a Regent share on 11July 2005, the Final* Offer represents a premium of approximately 54 per cent.over the closing price of 635 pence per Urbium share on 7 June 2005, the lastbusiness day prior to the commencement of the offer period. Furthermore, thecash component of the Final* Offer represents an increase of more than 78 percent. over the value of the cash alternative contained in Regent Inns' earlierproposal of 820 pence per Urbium share referred to in its statement of 8 June2005. The Final* Offer is subject to certain pre-conditions including completion ofdue diligence, a condition of the lenders to Regent Inns whose support has beenagreed in principle in relation to the funding of the cash component of theFinal* Offer. This pre-condition may not be waived. Regent Inns will not require an equity fundraising to finance the cash elementof the Final* Offer. The board of Regent Inns requested a response to its Final* Offer by 3.00 p.m.this afternoon. No such response has been received. The board of Regent Inns nowbelieves that the terms of its Final* Offer should be made known to Urbiumshareholders. The Final* Offer remains available for consideration by the boardof Urbium. The submission of the Final* Offer by Regent Inns this morning follows anearlier request by Urbium to the Panel on Takeovers and Mergers ("the TakeoverPanel") to impose a deadline for the announcement of a formal offer, nowdetermined as 21 July 2005. On 27 June 2005, Regent Inns submitted to the boardof Urbium on a confidential basis a revised proposal at 930 pence per share, 45per cent. of which was to be to be satisfied in cash and 55 per cent. of whichwas to be satisfied by the issue of new Regent Inns shares. The board of Urbiumconsidered this proposal for 9 days before rejecting it on 6 July 2005. Theboard of Regent Inns now believes that it is appropriate to inform Urbiumshareholders of the terms of its Final* Offer in order that a timely outcome canbe arrived at without further unnecessary delay. Regent Inns will not be able to proceed to the making of a formal offer withoutthe board of Urbium granting access to information to enable the Company toperform the due diligence investigations necessary prior to announcing a formaloffer. The board of Regent Inns believes that the Final* Offer represents an attractiveprice for Urbium shareholders, particularly in light of the following: • the trading statement released by Urbium on 4 July 2005, which referred to negative or flat like-for-like sales across its estate for the first half of its current financial year and the expectation that retail conditions will continue to be challenging for the whole of 2005; • the positive pre-close trading statement issued by Regent Inns on 7 July 2005 in relation to the 52 weeks ended 2 July 2005; and • the dilutive effect of the number of options over shares that have been awarded by the board of Urbium to its directors and employees (representing approximately 14.9 per cent. of Urbium's existing issued share capital**). This announcement does not represent a firm intention by Regent Inns to make anoffer for the purposes of the City Code on Takeovers and Mergers (the "CityCode"). There can be no certainty that an offer will ultimately be made, even ifthe pre-condition referred to above is satisfied. Regent Inns reserves the right to increase the Final* Offer if a Rule 2.5announcement in relation to Urbium is made by a third party. In accordance with Rule 2.4 of the City Code, Regent Inns reserves the right toreduce the share element of the Final* Offer for Urbium and/or to reduce thecash element of the Final* Offer, in either case where the offer is recommendedby the board of Urbium. Bob Ivell, Executive Chairman of Regent Inns said: "I believe that the Final* Offer should be very attractive to Urbiumshareholders in current circumstances. I am concerned that previous delays inresponding to our proposals and the refusal to enter into discussions by theUrbium board, combined with its own request to the Takeover Panel to impose adeadline of 21 July for a formal offer, may serve to frustrate the creation ofvalue for both sets of shareholders." Enquiries: Regent Inns 020 8375 3000Bob Ivell, Executive Chairman Close Brothers 020 7655 3100Richard Grainger / Christopher Lewey Panmure Gordon 020 7459 3600Tim Linacre Merlin 020 7653 6620Vanessa Maydon / Rebecca Penney The directors of Regent accept responsibility for the information contained inthis announcement. To the best of the knowledge and belief of the directors ofRegent (who have taken all reasonable care to ensure that such is the case), theinformation contained in this announcement is in accordance with the facts anddoes not omit anything likely to affect the import of such information.Close Brothers Corporate Finance Limited ("Close Brothers"), which is regulatedin the United Kingdom by The Financial Services Authority, is acting for Regentand no-one else in connection with the matters referred to in this announcementand will not be responsible to anyone other than Regent for providing theprotections afforded to customers of Close Brothers or for providing advice inrelation to the matters set out in this announcement or any transaction orarrangement referred to herein. Panmure Gordon & Co, which is regulated in the United Kingdom by The FinancialServices Authority, is acting for Regent and for no-one else in connection withthe matters referred to in this announcement and will not be responsible toanyone other than Regent for providing the protections afforded to customers ofPanmure Gordon & Co or for providing advice in connection with the matters setout in this announcement or any transaction or arrangement referred to herein. * Regent Inns reserves the right to increase the Final* Offer if a Rule 2.5 announcement in relation to Urbium is made by a third party. ** Sources and bases: The statement that options represent "approximately 14.9 per cent. of Urbium's existing issued share capital" is based on Urbium's Rule 2.10 announcement of 9 June 2005 (where Urbium disclosed that its current issued share capital comprised 10,374,289 ordinary shares) and the number of options disclosed in Urbium's 2004 Annual Report (1,369,098 options), with the addition of the options awarded on 23 May 2005 (183,333 options), less the shares issued to satisfy the exercise of options on 11 March 2005 (4,444 shares) and 23 March 2005 (2,352 shares). This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
REG.L