14th Mar 2008 07:00
Fenner PLC14 March 2008 14 March 2008 THIS ANNOUNCEMENT AND THE INFORMATION CONTAINED HEREIN IS NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, DIRECTLY OR INDIRECTLY, IN OR INTO THE UNITED STATES OF AMERICA, AUSTRALIA, CANADA OR JAPAN OR ANY JURISDICTION IN WHICH SUCH PUBLICATION OR DISTRIBUTION IS UNLAWFUL Fenner PLC ("Fenner" or "the Company") Placing of 15,657,910 new ordinary shares, acquisitions and trading update Introduction Fenner PLC ("Fenner" or the "Company"), the global engineer specialising in reinforced polymer technology, today announces it is placing up to 15,657,910 new ordinary shares of 25 pence each in the capital of the Company (the "Placing Shares") to institutional investors (the "Placing") representing in aggregate approximately 9.9 per cent. of the issued share capital of Fenner. The Company also updates on acquisitions and on trading up to 29th February2008, prior to the announcement of its interim results on Wednesday, 30th April2008. The Placing is being conducted by Hoare Govett Limited ("Hoare Govett") by way of an accelerated bookbuild (the "Bookbuilding"). The books will open withimmediate effect and pricing and allocations are expected to be announced today, 14th March 2008 shortly after the books have closed. Background to and reasons for the Placing Fenner has pursued a strategy for several years of growing the AdvancedEngineered Products ("AEP") Division by providing customer solutions using arange of advanced materials and related technologies to create value. This hasled to organic growth and the targeting of complementary bolt-on acquisitions. In the Conveyor Belting ("CB") division, market share has been grown through a targeted acquisition programme to enable Fenner to expand its global reach. From this base, the Group has continued its organic expansion through investmentin new wider-belt capability around the world complemented by an increasingrange of conveyor services. This in turn has led to the acquisition of anumber of service providers and offers a platform from which to exploit thegrowing energy and commodity markets. Since the start of the financial year, Fenner has continued its capitalinvestment programme to benefit from these markets with increased productcapability across the world. Organic investment has been complemented by a programme of bolt-on acquisitions in the AEP division and the addition of service businesses to enhance theoffering to our conveyor belting customers. So far the integration of these businesses across the Group has beenencouraging. The two small acquisitions, B-LOC and Spliceline, announced earlier this year, have already been integrated fully into the AEP and CB divisions respectively. In early February, the acquisition of Prodesco Inc, Pennsylvania, USA, wascompleted. This highly specialised technical textile structures business buildsupon the existing core weaving strengths. Additionally, the establishedposition in the medical devices market brings new opportunities in anattractive sector. In the short duration since joining the Fenner Group, theindications for this business are encouraging. Last week, Fenner made two acquisitions. It acquired substantially all of the operating assets and liabilities of Winfield Industries Inc, New York, USA. Thisleading supplier of performance-critical rollers for digital imagingapplications brings opportunities through common routes to market andoperational efficiencies. Fenner announces today that it has also acquired the entire issued share capitalof Northern Belting Specialists Pty Ltd from Amalia Austin and Colin Kranz for approximately AUS$5million. Northern Belting, which is based in Whyalla,Australia, is a service business specialising in belt splicing, rubber liningworks, mechanical and technical servicing and belting sales. Our previously announced major organic capital investment programmes have progressed satisfactorily. The integration of our seals business in Houston ontoa single site has been completed ahead of schedule with the synergies enhancing profits earlier than previously envisaged. Our other significant expansion plansin the CB division remain on schedule and are expected to improve next year's results. Today the Company announces that it plans a major investment of AUS$70 million to build a new "greenfield" manufacturing plant for steel cord conveyor belts at Kwinana, south of Perth. This facility will be the first new conveyor belt plantbuilt in Australia in over 60 years. Construction on a 4.6 ha site will begin in April 2008, with production expected to commence in the second quarter 2009. Fenner intends to maintain the momentum of its acquisition and developmentprogramme. On the acquisition front, there are a small number of companies withwhich Fenner is in advanced stages of negotiation. These are mostly small ormedium sized businesses which would be acquired wholly or substantiallyacquired for cash. As a result of the investment and acquisition programme, net borrowings at the end of February were approximately £110m. This also reflects the normalseasonality of cash flow, an increase as a result of foreign currencytranslation and an improvement as a result of tighter working capital. The purpose of the Placing is to finance Fenner's acquisition and development programme referred to whilst maintaining interest cover and debt at levels considered appropriate for the expansion of the Group. The Placing The Placing Shares will be issued credited as fully paid and will rank paripassu in all respects with the existing ordinary shares of Fenner, includingthe right to receive all dividends and other distributions declared, made orpaid after the date of issue. Application will be made to the UK Listing Authority and to London StockExchange plc for the new ordinary shares, to be admitted to the Official Listmaintained by the UK Listing Authority, and to be admitted to trading by LondonStock Exchange plc on its market for listed securities. It is expected thatsuch admissions will become effective by 8 a.m. on 19 th March 2008. The full terms and conditions of the Placing are set out in the appendix to this press release. Current trading update Further to the update in the combined AGM and Interim Management Statement on 9th January, the Group has continued to perform strongly. Customer demand for our products in our core businesses has remained robust with revenues and profits ahead of last year. In the Advanced Engineered Products division satisfactory progress has beenachieved. In particular, the Drives and Seals businesses have produced strongresults with a steady performance from the Hose operations. The Conveyor Belting division is performing well as the fundamentalcharacteristics of energy markets have increased the demand for our products andservices. We have benefited from a favourable mix of business. As a consequence, we anticipate reporting results for the half year ended 29th February 2008 at the top end of our expectations and view the future prospectsof Fenner with confidence. Mark Abrahams, Chief Executive said: "Fenner's performance has been good in the first half, our businesses are well placed in strong markets and we are confident about prospects. The fund raising announced today will help us continue the momentum of our acquisition and organic development programme and benefit from the many growth opportunities available to us across our markets." Enquiries: Fenner PLCMark Abrahams, Chief Executive 01482 626501Richard Perry, Finance Director Weber Shandwick Financial 020 7067 0700Nick OborneStephanie BadjonatHannah Marwood Hoare Govett 020 7678 8000Tim RowntreeJohn MacGowanJames Baker This announcement has been issued by Fenner and is the sole responsibility of Fenner. Neither Hoare Govett nor any of its affiliates and agents shall haveany liability for any information contained in this announcement. Thisannouncement is for information purposes only and does not constitute an offerto sell or an invitation to subscribe for or a solicitation of an offer to buyor subscribe for any securities in any jurisdiction including in which such anoffer or solicitation is unlawful and is not for distribution in or into,without limitation, the United Kingdom, the United Sates, Canada, Australia orJapan (the "Excluded Territories"),or to US persons (within the meaning ofRegulations of the United States Securities Act 1933 (as amended) (the"Securities Act")). The Placing Shares have not been and will not be registered under the SecuritiesAct or under the applicable securities laws of any state in the United States orany Excluded Territory and, unless an exemption under such act or laws isavailable may not be offered for sale or subscription or sold or subscribeddirectly or indirectly within the Excluded Territories or for the account orbenefit of any national, resident or citizen of the Excluded Territories. Nopublic offering of securities will be made in the United States. Thedistribution of this announcement in other jurisdictions may be restricted bylaw and therefore persons into whose possession this announcement comes shouldinform themselves about and observe any such restrictions. Any failure tocomply with these restrictions may constitute a violation of the securitieslaws of such jurisdictions. Hoare Govett, which is authorised and regulated by the Financial ServicesAuthority, is acting exclusively for Fenner and for no one else in connectionwith the Bookbuilding and the Placing and will not be responsible to anyoneother than Fenner for providing the protections afforded to clients of HoareGovett nor for providing advice in relation to the Placing or the Bookbuildingor any other matters referred to in this announcement. The contents of this announcement are not to be construed as legal, financial ortax advice. If necessary, each recipient of this announcement should consulthis, her or its own legal adviser, financial adviser or tax adviser for legal,financial or tax advice. This announcement contains certain statements that are or may be "forward-looking statements". These statements typically contain words such as"intends", "expects", "anticipates", "estimates" and words of similar import. All the statements other than statements of historical facts included in thisannouncement, including, without limitation, those regarding Fenner's financialposition, business strategy, plans and objectives of management for futureoperations (including development plans and objectives relating to Fenner'sproducts and services) are forward-looking statements. By their nature,forward-looking statements involve risk and uncertainty because they relate toevents and depend on circumstances that will occur in the future and thereforeundue reliance should not be placed on such forward-looking statements. Thereare a number of factors that could cause the actual results, performance orachievements of Fenner or those markets and economies to be materially differentfrom future results, performance or achievements expressed or implied by suchforward-looking statements. Such forward-looking statements are based on numerous assumptions regarding Fenner's present and future business strategiesand the environment in which Fenner will operate in the future and suchassumptions may or may not prove to be correct. Forward-looking statementsspeak only as at the date they are made. Neither Fenner nor Hoare Govett norany other person undertakes any obligation (other than, in the case of Fenner,pursuant to the Listing Rules and the Disclosure and Transparency Rules of theUK Listing Authority) to update publicly any of the information contained inthis announcement, including any forward-looking statements, in the light ofnew information, change in circumstances or future events. APPENDIX: TERMS AND CONDITIONS OF THE PLACING NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, DIRECTLY OR INDIRECTLY, IN OR INTOTHE UNITED STATES, CANADA, AUSTRALIA OR JAPAN IMPORTANT INFORMATION FOR PLACEES ONLY REGARDING THE PLACING MEMBERS OF THE PUBLIC ARE NOT ELIGIBLE TO TAKE PART IN THE PLACING. THISAPPENDIX AND THE TERMS AND CONDITIONS SET OUT HEREIN ARE DIRECTED ONLY ATPERSONS WHOSE ORDINARY ACTIVITIES INVOLVE THEM IN ACQUIRING, HOLDING, MANAGINGAND DISPOSING OF INVESTMENTS (AS PRINCIPAL OR AGENT) FOR THE PURPOSES OF THEIRBUSINESS AND WHO HAVE PROFESSIONAL EXPERIENCE IN MATTERS RELATING TO INVESTMENTSAND ARE (1) QUALIFIED INVESTORS AS DEFINED IN SECTION 86(7) OF FSMA, BEINGPERSONS FALLING WITHIN THE MEANING OF ARTICLE 2.1(e)(i), (ii) OR (iii) OFDIRECTIVE 2003/71/EC (THE "PROSPECTUS DIRECTIVE") AND (2) IN THE UNITED KINGDOMFALL WITHIN ARTICLE 19(5) OF THE FINANCIAL SERVICES AND MARKETS ACT 2000(FINANCIAL PROMOTION) ORDER 2005, AS AMENDED OR ARE PERSONS WHO FALL WITHINARTICLE 49(2)(a) TO (d) ("HIGH NET WORTH COMPANIES, UNINCORPORATED ASSOCIATIONS,ETC") OF THE ORDER (ALL SUCH PERSONS TOGETHER BEING REFERRED TO AS "RELEVANTPERSONS"). THIS APPENDIX AND THE TERMS AND CONDITIONS SET OUT HEREIN (AND THEANNOUNCEMENT OF WHICH IT FORMS PART) MUST NOT BE ACTED ON OR RELIED ON BYPERSONS WHO ARE NOT RELEVANT PERSONS. ANY INVESTMENT OR INVESTMENT ACTIVITY TOWHICH THIS APPENDIX AND THE TERMS AND CONDITIONS SET OUT HEREIN RELATES ISAVAILABLE ONLY TO RELEVANT PERSONS AND WILL BE ENGAGED IN ONLY WITH RELEVANTPERSONS. PERSONS DISTRIBUTING THIS APPENDIX (AND THE ANNOUNCEMENT OF WHICH ITFORMS PART) MUST SATISFY THEMSELVES THAT IT IS LAWFUL TO DO SO. THIS APPENDIXDOES NOT ITSELF CONSTITUTE AN OFFER FOR SALE OR SUBSCRIPTION OF ANY SECURITIESIN FENNER PLC. THE PLACING SHARES HAVE NOT AND WILL NOT BE REGISTERED UNDER THE UNITED STATESSECURITIES ACT OF 1933 (THE "SECURITIES ACT") OR UNDER THE SECURITIES LAWS OFANY STATE OR OTHER JURISDICTION OF THE UNITED STATES, AND ABSENT REGISTRATIONMAY NOT BE OFFERED OR SOLD IN THE UNITED STATES EXCEPT PURSUANT TO AN EXEMPTIONFROM, OR AS A PART OF A TRANSACTION NOT SUBJECT TO, THE REGISTRATIONREQUIREMENTS OF THE SECURITIES ACT AND THE SECURITIES LAWS OF ANY STATE OR OTHERJURISDICTION OF THE UNITED STATES. EACH PLACEE SHOULD CONSULT WITH ITS OWN ADVISERS AS TO LEGAL, TAX, BUSINESS ANDRELATED ASPECTS OF A PURCHASE OF PLACING SHARES. This announcement and any offer if made subsequently is only addressed to anddirected at persons in member states of the European Economic Area ("EEA") whoare "qualified investors" within the meaning of Article 2(1)(e) of theProspectus Directive (Directive 2003/71/EC) ("Qualified Investors"). By participating in the Bookbuilding and the Placing, Placees will be deemed tohave read and understood this Appendix in its entirety, to be participating,making an offer and acquiring Placing Shares on the terms and conditionscontained herein and to be providing the representations, warranties,acknowledgements and undertakings contained herein. In particular each such Placee represents, warrants and acknowledges that it: 1. is a Relevant Person and undertakes that it will acquire, hold, manage ordispose of any Placing Shares that are allocated to it for the purposes of itsbusiness; 2. in the case of a Relevant Person in a member state of the EEA which hasimplemented the Prospectus Directive (each a "Relevant Member State") whoacquires any Placing Shares pursuant to the Placing: (i) it is a Qualified Investor; and (ii) in the case of any Placing Shares acquired by it as a financial intermediary, as that term is used in Article 3(2) of the Prospectus Directive, (a) the Placing Shares acquired by it in the Placing have not been acquired on behalf of, nor have they been acquired with a view to their offer or resale to,persons in any Relevant Member State other than Qualified Investors or in circumstances in which the prior consent of Hoare Govett has been given to theoffer or resale; or (b) where Placing Shares have been acquired by it on behalf of persons in any member state of the EEA other than Qualified Investors, the offer of those Placing Shares to it is not treated under the Prospectus Directive as having been made to such persons; and 3. is acquiring the Placing Shares for its own account or is acquiring thePlacing Shares for an account with respect to which it exercises sole investmentdiscretion, and that it (and any such account) is outside the United States, orit is a dealer or other professional fiduciary in the United States acting on adiscretionary basis for non-US beneficial owners (other than an estate ortrust), in reliance on Regulation S of the Securities Act ("Regulation S"). This announcement (including this Appendix) does not constitute an offer to sellor issue or the solicitation of an offer to buy or subscribe for Placing Sharesin any jurisdiction including, without limitation, the United Kingdom, theUnited States, Canada, Australia or Japan. This announcement and the informationcontained herein are not for publication or distribution, directly orindirectly, to persons in the United States, Canada, Australia, Japan or in anyjurisdiction in which such publication or distribution is unlawful. The Placing Shares referred to in this announcement have not been and will notbe registered under the Securities Act or with any securities regulatoryauthority of any State or other jurisdiction of the United States, and may notbe offered, sold or transferred within the United States except pursuant to anexemption from, or in a transaction not subject to, the registrationrequirements of the Securities Act. The Placing Shares are being offered andsold outside the United States in accordance with Regulation S. The Company hasnot and does not intend to offer any securities to the public in the UnitedStates. No money, securities or other consideration from any person inside theUnited States is being solicited and, if sent in response to the informationcontained in this announcement, will not be accepted. The distribution of this announcement and the Placing and/or issue of thePlacing Shares in certain jurisdictions may be restricted by law. No action hasbeen taken by the Company or Hoare Govett or any of their respectivesubsidiaries, branches, associates, holding companies (and subsidiaries of anysuch holding companies), officers, directors, supervisory board members,employees, representatives, controlling persons, shareholders or agents(together "Affiliates"), that would permit an offer of the Placing Shares orpossession or distribution of this announcement or any other offering orpublicity material relating to such Placing Shares in any jurisdiction whereaction for that purpose is required. Persons into whose possession thisannouncement comes are required by the Company and Hoare Govett to informthemselves about and to observe any such restrictions. In this Appendix, unless the context otherwise requires, the "Company" meansFenner plc and "Placee" includes a person (including individuals, funds orothers) on whose behalf a commitment to acquire Placing Shares has been given. No prospectus No prospectus or other offering document has been or will be submitted to beapproved by the Financial Services Authority (the "FSA") in relation to thePlacing and the Placees' commitments will be made solely on the basis of theinformation contained in this announcement, the Pricing Announcement (as thisterm is defined in paragraph 2 of the Principal Terms of the Bookbuilding andPlacing below) and any information publicly announced to a RegulatoryInformation Service by or on behalf of the Company on or prior to the date ofthis announcement (the "Publicly Available Information"). Each Placee, byparticipating in the Placing, agrees that it has neither received nor relied onany information, representation, warranty or statement made by or on behalf ofHoare Govett or the Company other than the Publicly Available Information andneither Hoare Govett, the Company nor any person acting on such person's behalfnor any of their Affiliates has or shall have any liability for any Placee'sdecision to accept this invitation to participate in the Placing based on anyother information, representation, warranty or statement. Each Placeeacknowledges and agrees that it has relied on its own investigation of thebusiness, financial or other position of the Company in accepting aparticipation in the Placing. Nothing in this paragraph shall exclude theliability of any person for fraudulent misrepresentation. Details of the Placing Agreement and the Placing Shares Hoare Govett has entered into a placing agreement (the "Placing Agreement") withthe Company under which Hoare Govett has undertaken, on the terms and subject tothe conditions set out in the Placing Agreement, to arrange and underwrite thePlacing. The Placing Shares will, when issued, be credited as fully paid and will rankpari passu in all respects with the existing issued ordinary shares of 25 penceper share in the capital of the Company (the "Ordinary Shares"), including theright to receive all dividends and other distributions declared, made or paid inrespect of such Ordinary Shares after the date of issue of the Placing Shares. Application for admission to listing and trading Application will be made to the FSA for admission of the Placing Shares to theofficial list maintained by the FSA (the "Official List") and to London StockExchange plc for admission to trading of the Placing Shares on London StockExchange plc's main market for listed securities (together "Admission"). It isexpected that Admission will take place on or before 19th March 2008 and thatdealings in the Placing Shares on London Stock Exchange plc's main market forlisted securities will commence at the same time. Bookbuilding Hoare Govett will today commence the Bookbuilding to determine demand forparticipation in the Placing by Placees. This Appendix gives details of theterms and conditions of, and the mechanics of participation in, the Placing. Nocommissions will be paid to Placees or by Placees in respect of any PlacingShares. Hoare Govett and the Company shall be entitled to effect the Placing by suchalternative method to the Bookbuilding as they may, in their sole discretion,determine. Principal terms of the Bookbuilding and Placing 1. Hoare Govett (whether through itself or any of its Affiliates) is arrangingthe Placing as an agent of the Company. Participation in the Placing will onlybe available to persons who may lawfully be, and are, invited by Hoare Govett toparticipate. Hoare Govett and its Affiliates are entitled to participate asprincipal in the Placing. 2. The Bookbuilding will establish a single price (the "Placing Price") payableto Hoare Govett by all Placees. The Placing Price and the aggregate proceeds tobe raised through the Placing will be agreed between Hoare Govett and theCompany following completion of the Bookbuilding and any discount to the marketprice of the ordinary shares of the Company admitted to the Official List and totrading on London Stock Exchange plc's main market for listed securities will bedetermined in accordance with the Listing Rules of the UK Listing Authority. ThePlacing Price will be announced (the "Pricing Announcement") on a RegulatoryInformation Service following completion of the Bookbuilding. 3. To bid in the Bookbuilding, Placees should communicate their bid by telephoneto their usual sales contact at Hoare Govett. Each bid should state the numberof shares in the Company which a prospective Placee wishes to acquire at eitherthe Placing Price which is ultimately established by the Company and HoareGovett or at prices up to a price limit specified in its bid. Bids may be scaleddown by Hoare Govett on the basis referred to in paragraph 6 below. Hoare Govettis arranging the Placing as agent of the Company. 4. The Bookbuilding is expected to close no later than 3.00 p.m. (GMT) on 14thMarch 2008 but may be closed earlier or later at the discretion of Hoare Govett.Hoare Govett may, in agreement with the Company, accept bids that are receivedafter the Bookbuilding has closed. The Company reserves the right to reduce orseek to increase the amount to be raised pursuant to the Placing, in itsdiscretion. 5. Allocations will be confirmed orally by Hoare Govett as soon as practicablefollowing the close of the Bookbuilding. Hoare Govett's oral confirmation of anallocation will give rise to a legally binding commitment by the Placeeconcerned, in favour of Hoare Govett and the Company, under which it agrees toacquire the number of Placing Shares allocated to it on the terms and subject tothe conditions set out in this Appendix and the Company's Memorandum andArticles of Association. 6. Subject to paragraph 4 above, Hoare Govett may choose to accept bids, eitherin whole or in part, on the basis of allocations determined at its discretion(in agreement with the Company) and may scale down any bids for this purpose onsuch basis as it may determine. Hoare Govett may also, notwithstandingparagraphs 4 and 5 above, subject to the prior consent of the Company (a)allocate Placing Shares after the time of any initial allocation to any personsubmitting a bid after that time and (b) allocate Placing Shares after theBookbuilding has closed to any person submitting a bid after that time. 7. A bid in the Bookbuilding will be made on the terms and subject to theconditions in this Appendix and will be legally binding on the Placee on behalfof which it is made and, except with Hoare Govett's consent, will not be capableof variation or revocation after the time at which it is submitted. Each Placeewill have an immediate, separate, irrevocable and binding obligation, owed toHoare Govett, to pay to it (or as it may direct) in cleared funds an amountequal to the product of the Placing Price and the number of Placing Shares suchPlacee has agreed to acquire. 8. Except as required by law or regulation, no press release or otherannouncement will be made by Hoare Govett or the Company using the name of anyPlacee (or its agent), in its capacity as Placee (or agent), other than withsuch Placee's prior written consent. 9. Irrespective of the time at which a Placee's allocation(s) pursuant to thePlacing is/are confirmed, settlement for all Placing Shares to be acquiredpursuant to the Placing will be required to be made at the same time, on thebasis explained below under "Registration and Settlement". 10. All obligations under the Bookbuilding and Placing will be subject tofulfilment of the conditions referred to below under "Conditions of the Placing"and to the Placing not being terminated on the basis referred to below under"Termination of the Placing". 11. By participating in the Bookbuilding each Placee will agree that its rightsand obligations in respect of the Placing will terminate only in thecircumstances described below and will not be capable of rescission ortermination by the Placee. 12. To the fullest extent permissible by law, neither Hoare Govett nor any ofits Affiliates shall have any liability to Placees (or to any other personwhether acting on behalf of a Placee or otherwise). In particular, neither HoareGovett nor any of its Affiliates shall have any liability (including, to theextent permissible by law, any fiduciary duties) in respect of Hoare Govett'sconduct of the Bookbuilding or of such alternative method of effecting thePlacing as Hoare Govett and the Company may agree. Registration and Settlement If Placees are allocated any Placing Shares in the Placing they will be sent acontract note or electronic confirmation which will confirm the number ofPlacing Shares allocated to them, the Placing Price and the aggregate amountowed by them to Hoare Govett. Each Placee will be deemed to agree that it willdo all things necessary to ensure that delivery and payment is completed inaccordance with either the standing CREST or certificated settlementinstructions which they have in place with Hoare Govett. Settlement of transactions in the Placing Shares following Admission will takeplace within the CREST system. Settlement through CREST will be on a T+3 basisunless otherwise notified by Hoare Govett and is expected to occur on or before19th March 2008. Settlement will be on a delivery versus payment basis. However,in the event of any difficulties or delays in the admission of the PlacingShares to CREST or the use of CREST in relation to the Placing, the Company andHoare Govett may agree that the Placing Shares should be issued in certificatedform. Hoare Govett reserves the right to require settlement for the PlacingShares, and to deliver the Placing Shares to Placees, by such other means as itdeems necessary if delivery or settlement to Placees is not practicable withinthe CREST system or would not be consistent with regulatory requirements in aPlacee's jurisdiction. Interest is chargeable daily on payments not received on the due date inaccordance with the arrangements set out above, in respect of either CREST orcertificated deliveries, at the rate of 2 percentage points above prevailingLIBOR. If Placees do not comply with their obligations Hoare Govett may sell theirPlacing Shares on their behalf and retain from the proceeds, for its own accountand benefit, an amount equal to the Placing Price of each share sold plus anyinterest due. Placees will, however, remain liable for any shortfall below thePlacing Price and for any stamp duty or stamp duty reserve tax (together withany interest or penalties) which may arise upon the sale of their Placing Shareson their behalf. If Placing Shares are to be delivered to a custodian or settlement agent,Placees must ensure that, upon receipt, the conditional contract note is copiedand delivered immediately to the relevant person within that organisation. Conditions of the Placing The Placing is conditional upon the Placing Agreement becoming unconditional andnot having been terminated in accordance with its terms. The obligations of Hoare Govett under the Placing Agreement are, and the Placingis, conditional on (inter alia): (a) Admission taking place by not later than 8.00 a.m. on 19th March 2008; (b) the Company having complied with all its obligations under the PlacingAgreement (to the extent such obligations fall to be performed prior toAdmission) in all respects which are material in the context of the Placing; (c) each of the warranties given by the Company under the Placing Agreement (the"Warranties") and any statement made in any of the Marketing Documents (beingcertain marketing documents including this announcement and the presentation inthe agreed form used by the Company for the purposes of marketing the Placing)not being untrue, inaccurate or misleading prior to Admission in any respectwhich is material in the context of the Placing when made, nor becoming untrue,inaccurate or misleading in any respect which is material in the context of thePlacing by reference to the facts and circumstances existing at the time; (d) in the good faith opinion of Hoare Govett there not having occurred prior toAdmission a material adverse change (whether or not foreseeable at the date ofthe Placing Agreement) in, or any development reasonably likely to involve aprospective material adverse change in or affecting, the condition (financial,operational, legal or otherwise) or the earnings or business affairs or businessprospects of the Group, whether or not arising in the ordinary course ofbusiness; (e) the Company delivering to Hoare Govett on the day prior to the expected dateof Admission a certificate confirming certain matters (including that none ofthe Warranties was untrue, inaccurate or misleading at the date of the PlacingAgreement or has at any time since that date become untrue, inaccurate ormisleading by reference to the facts and circumstances existing since thatdate); and (e) the Company allotting the Placing Shares, prior to and conditional only onAdmission, in accordance with the terms of the Placing Agreement. If the conditions in the Placing Agreement are not satisfied or waived inaccordance with the Placing Agreement within the stated time periods (or suchlater time and/or date as the Company and Hoare Govett may agree), or thePlacing Agreement is terminated in accordance with its terms, the Placing willlapse and the Placee's rights and obligations shall cease and terminate at suchtime and each Placee agrees that no claim can be made by or on behalf of thePlacee (or any person on whose behalf the Placee is acting) in respect thereof.By participating in the Bookbuilding, each Placee agrees that its rights andobligations cease and terminate only in the circumstances described above andunder "Termination of the Placing" below and will not be capable of rescissionor termination by it. Hoare Govett may, in its absolute discretion and on such terms as it thinksappropriate, waive fulfilment, in whole or in part, of any or all of theconditions to the Placing Agreement (to the extent permitted by law orregulations) by giving notice in writing to the Company. Any such extension orwaiver will not affect Placees' commitments as set out in this Appendix. None of Hoare Govett or any of its Affiliates or the Company shall have anyliability to any Placee (or to any other person whether acting on behalf of aPlacee or otherwise) in respect of any decision any of them may make as towhether or not to waive or to extend the time and/or date for the satisfactionof any condition to the Placing nor for any decision any of them may make as tothe satisfaction of any condition or in respect of the Placing generally. Termination of the Placing Hoare Govett has the right, in its absolute discretion, to terminate the PlacingAgreement prior to Admission in certain circumstances, including (inter alia)if: (a) any of the Warranties or any statement made in any of the MarketingDocuments being untrue, inaccurate or misleading in any respect which ismaterial in the context of the Placing when made or becoming untrue, inaccurateor misleading in any respect which is material in the context of the Placing byreference to the facts and circumstances existing from time to time or anymatter arises which might reasonably be expected to give rise to a claim underthe indemnity contained in the Placing Agreement; or (b) the Company not having complied with all of its obligations under thePlacing Agreement (to the extent such obligations fall to be performed prior toAdmission) in any respect which is material in the context of the Placing; or (c) in the good faith opinion of Hoare Govett, any material adverse change,whether or not foreseeable at the date of the Placing Agreement, in, or anydevelopment reasonably likely to involve a prospective material adverse changein or affecting, the condition (financial, operational, legal or otherwise) orthe earnings or business affairs or business prospects of the Group, whether ornot arising in the ordinary course of business having occurred; or (d) any of the following: (i) any material adverse change in the financial markets in the United States,the United Kingdom, any member of the European Union or the internationalfinancial markets, any outbreak of hostilities or escalation of hostilities orother calamity or crisis, any change or development involving a prospectivechange in national or international political, financial or economic conditions,or currency exchange rates, in each case the effect of which is such as to makeit, in the good faith judgment of Hoare Govett, impracticable or inadvisable tomarket the Placing Shares and to proceed with the Placing in the mannercontemplated in the Marketing Documents or to enforce contracts for sale of thePlacing Shares or which may materially and adversely affect the success of thePlacing or dealings in the Placing Shares following Admission; or (ii) any suspension or limitation in the trading in any securities of theCompany being imposed by the London Stock Exchange on any exchange orover-the-counter market, or if trading generally on the New York Stock Exchange,the NASDAQ National Market or the London Stock Exchange has been suspended orlimited, or minimum or maximum prices for trading have been fixed, or maximumranges for prices have been required, by any of such exchanges or by such systemor by order of any governmental authority, or a material disruption has occurredin commercial banking or securities settlement or clearance services in theUnited States or in Europe; or (iii) the declaration of a banking moratorium by US or UK authorities; or (iv) a material adverse change or a prospective material adverse changeoccurring since the date of the Placing Agreement in UK taxation affecting theOrdinary Shares or the transfer of the Ordinary Shares (otherwise than as setout in the Marketing Documents) or the imposition of exchange controls by theUnited States or the United Kingdom. If the Placing Agreement is terminated in accordance with its terms, the rightsand obligations of each Placee in respect of the Placing as described in thisannouncement (including this Appendix) shall cease and terminate at such timeand no claim can be made by any Placee in respect thereof. By participating in the Placing, each Placee agrees with the Company and HoareGovett that the exercise by the Company or Hoare Govett of any right oftermination or any other right or other discretion under the Placing Agreementshall be within the absolute discretion of the Company or Hoare Govett (as thecase may be) and that neither the Company nor Hoare Govett need make anyreference to such Placee and that neither the Company, Hoare Govett nor any oftheir respective Affiliates shall have any liability to such Placee (or to anyother person whether acting on behalf of a Placee or otherwise) whatsoever inconnection with any such exercise. By participating in the Placing, each Placee agrees that its rights andobligations terminate only in the circumstances described above and will not becapable of rescission or termination by it after oral confirmation by HoareGovett following the close of the Bookbuilding. Representations and further terms By submitting a bid in the Bookbuilding, each prospective Placee (and any personacting on such Placee's behalf) represents, warrants, acknowledges, undertakesand agrees (for itself and for any such prospective Placee) that: 1. it has read this announcement (including this Appendix) in its entirety andthat its purchase of the Placing Shares is subject to and based upon all theterms, conditions, representations, warranties, acknowledgements, agreements andundertakings and other information contained herein; 2. it has not received a prospectus or other offering document in connectionwith the Placing and acknowledges that no prospectus or other offering documenthas been or will be prepared in connection with the Placing; 3. (i) it has made its own assessment of the Company, the Placing Shares and theterms of the Placing based on Publicly Available Information; (ii) none of HoareGovett, its Affiliates or the Company has made any representation to it, expressor implied, with respect to the Company, the Placing or the Placing Shares orthe accuracy, completeness or adequacy of the Publicly Available Information;and (iii) it has conducted its own investigation of the Company, the Placing andthe Placing Shares, satisfied itself that the information is still current andrelied on that investigation for the purposes of its decision to participate inthe Placing; 4. the content of this announcement is exclusively the responsibility of theCompany and that neither Hoare Govett nor any person acting on its behalf isresponsible for or has or shall have any liability for any information orrepresentation relating to the Company contained in this announcement or thePublicly Available Information nor will be liable for any Placee's decision toparticipate in the Placing based on any information, representation, warranty orstatement contained in this announcement, the Publicly Available Information orotherwise. Nothing in this Appendix shall exclude any liability of any personfor fraudulent misrepresentation; 5. it is not, and at the time the Placing Shares are acquired will not be, aresident of Australia, Canada or Japan, and each of it and the beneficial ownerof the Placing Shares is, and at the time the Placing Shares are acquired willbe outside the United States and acquiring the Placing Shares in an 'offshoretransaction' in accordance with Rule 903 or Rule 904 of Regulation S; 6. the Placing Shares have not been registered or otherwise qualified, and willnot be registered or otherwise qualified, for offer and sale nor will aprospectus be cleared in respect of any of the Placing Shares under thesecurities laws of the United States, Australia, Canada or Japan and, subject tocertain exceptions, may not be offered, sold, taken up, renounced or deliveredor transferred, directly or indirectly, within the United States, Australia,Canada or Japan; 7. it and/or each person on whose behalf it is participating: (i) is entitled to acquire Placing Shares pursuant to the Placing under the lawsof all relevant jurisdictions; (ii) has fully observed such laws; (iii) has capacity and authority and is entitled to enter into and perform itsobligations as an acquirer of Placing Shares and will honour such obligations;and (iv) has obtained all necessary consents and authorities (including, withoutlimitation, in the case of a person acting on behalf of a Placee, all necessaryconsents and authorities to agree to the terms set out or referred to in thisAppendix) to enable it to enter into the transactions contemplated hereby and toperform its obligations in relation thereto; 8. the Placing Shares have not and will not be registered under the SecuritiesAct, or under the securities laws of any state of the United States, and arebeing offered and sold on behalf of the Company in offshore transactions (asdefined in Regulation S) in accordance with an exemption from, or transactionnot subject to, the registration requirements under the Securities Act; 9. it will not reoffer, sell, pledge or otherwise transfer the Placing Sharesexcept (i) in an offshore transaction in accordance with Rule 903 or 904 ofRegulation S; (ii) pursuant to an exemption from, or a transaction not subjectto, registration under the Securities Act (if available); or (iii) pursuant toan effective registration statement under the Securities Act and that, in eachsuch case, such offer, sale, pledge or transfer will be made in accordance withany applicable securities laws of any state of the United States; 10. if it is a pension fund or investment company, its acquisition of PlacingShares is in full compliance with applicable laws and regulations; 11. no representation has been made as to the availability of any otherexemption under the Securities Act for the reoffer, resale, pledge or transferof the Placing Shares; 12. participation in the Placing is on the basis that it is not and will not bea client of Hoare Govett and that Hoare Govett has no duties or responsibilitiesto a Placee for providing protections afforded to its clients or for providingadvice in relation to the Placing nor in respect of any representations,warranties, undertakings or indemnities contained in the Placing Agreement; 13. it will make payment to Hoare Govett in accordance with the terms andconditions of this announcement on the due times and dates set out in thisannouncement, failing which the relevant Placing Shares may be placed withothers on such terms as Hoare Govett determines; 14. the person who it specifies for registration as holder of the Placing Shareswill be (i) the Placee or (ii) a nominee of the Placee, as the case may be.Hoare Govett and the Company will not be responsible for any liability to stampduty or stamp duty reserve tax resulting from a failure to observe thisrequirement. It agrees to acquire Placing Shares pursuant to the Placing on thebasis that the Placing Shares will be allotted to a CREST stock account of HoareGovett who will hold them as nominee on behalf of the Placee until settlement inaccordance with its standing settlement instructions with it; 15. the allocation, allotment, issue and delivery to it, or the person specifiedby it for registration as holder, of Placing Shares will not give rise to astamp duty or stamp duty reserve tax liability under (or at a rate determinedunder) any of sections 67, 70, 93 or 96 of the Finance Act 1986 (depositoryreceipts and clearance services) and that it is not participating in the Placingas nominee or agent for any person or persons to whom the allocation, allotment,issue or delivery of Placing Shares would give rise to such a liability; 16. it and any person acting on its behalf falls within Article 19(5) and/or 49(2) of the Financial Services and Markets Act 2000 (Financial Promotion) Order2005, as amended, and undertakes that it will acquire, hold, manage and (ifapplicable) dispose of any Placing Shares that are allocated to it for thepurposes of its business only; 17. it has not offered or sold and will not offer or sell any Placing Shares topersons in the United Kingdom prior to Admission except to persons whoseordinary activities involve them in acquiring, holding, managing or disposing ofinvestments (as principal or agent) for the purposes of their business orotherwise in circumstances which have not resulted and which will not result inan offer to the public in the United Kingdom within the meaning of section 85(1)FSMA; 18. it is a qualified investor as defined in section 86(7) of FSMA, being aperson falling within Article 2.1(e)(i), (ii) or (iii) of the ProspectusDirective; 19. it has only communicated or caused to be communicated and it will onlycommunicate or cause to be communicated any invitation or inducement to engagein investment activity (within the meaning of section 21 of the FSMA) relatingto Placing Shares in circumstances in which section 21(1) of the FSMA does notrequire approval of the communication by an authorised person; 20. it has complied and it will comply with all applicable provisions of theFSMA with respect to anything done by it or on its behalf in relation to thePlacing Shares in, from or otherwise involving the United Kingdom; 21. it has not offered or sold and will not offer or sell any Placing Shares topersons in the European Economic Area prior to Admission except to persons whoseordinary activities involve them in acquiring, holding, managing or disposing ofinvestments (as principal or agent) for the purpose of their business orotherwise in circumstances which have not resulted and which will not result inan offer to the public in any member state of the European Economic Area withinthe meaning of the Prospectus Directive (which means Directive 2003/71/EC andincludes any relevant implementing measure in any member state); 22. it has complied with its obligations in connection with money laundering andterrorist financing under the Proceeds of Crime Act 2002, the Terrorism Act 2000and the Money Laundering Regulations (2003) (the "Regulations") and, if makingpayment on behalf of a third party, that satisfactory evidence has been obtainedand recorded by it to verify the identity of the third party as required by theRegulations; 23. the Company, Hoare Govett and others will rely upon the truth and accuracyof the foregoing representations, warranties, acknowledgements and agreements; 24. if it is a financial intermediary as that term is used in Article 3(2) of the Prospectus Directive, the Placing Shares purchased by it in thePlacing have not been acquired on a non-discretionary basis on behalf of, norhave they been acquired with a view to their offer or resale to, persons in amember state of the European Economic Area which has implemented the ProspectusDirective other than Qualified Investors, or, in the circumstances in which theprior written consent of Hoare Govett has been given to the offer or resale; 25. the Placing Shares will be issued subject to the terms and conditions ofthis Appendix; and 26. this Appendix and all documents into which this Appendix is incorporated byreference or otherwise validly forms a part will be governed by and construed inaccordance with English law. All agreements to acquire shares pursuant to theBookbuilding and/or the Placing will be governed by English law and the Englishcourts shall have exclusive jurisdiction in relation thereto except thatproceedings may be taken by Hoare Govett in any jurisdiction in which therelevant Placee is incorporated or in which any of its securities have aquotation on a recognised stock exchange. By participating in the Placing, each Placee (and any person acting on suchPlacee's behalf) agrees to indemnify and hold the Company and Hoare Govettharmless from any and all costs, claims, liabilities and expenses (includinglegal fees and expenses) arising out of or in connection with any breach of therepresentations, warranties, acknowledgements, agreements and undertakings inthis Appendix and further agrees that the provisions of this Appendix shallsurvive after completion of the Placing. Please also note that the agreement to allot and issue Placing Shares to Placees(or the persons for whom Placees are contracting as agent) free of stamp dutyand stamp duty reserve tax in the UK relates only to their allotment and issueto Placees, or such persons as they nominate as their agents, directly by theCompany. Such agreement assumes that the Placing Shares are not being acquiredin connection with arrangements to issue depositary receipts or to transfer thePlacing Shares into a clearance service. If there were any such arrangements, orthe settlement related to other dealings in the Placing Shares, stamp duty orstamp duty reserve tax may be payable, for which neither the Company nor HoareGovett would be responsible. If this is the case, it would be sensible forPlacees to take their own advice and they should notify Hoare Govettaccordingly. In addition, Placees should note that they will be liable for anycapital duty, stamp duty and all other stamp, issue, securities, transfer,registration, documentary or other duties or taxes (including any interest,fines or penalties relating thereto) payable outside the UK by them or any otherperson on the acquisition by them of any Placing Shares or the agreement by themto acquire any Placing Shares. The representations, warranties, acknowledgements and undertakings contained inthis Appendix are given to Hoare Govett for itself and on behalf of the Companyand are irrevocable. Hoare Govett is acting exclusively for the Company and no one else in connectionwith the Bookbuilding and the Placing, and Hoare Govett will not be responsibleto anyone (including any Placees) other than the Company for providing theprotections afforded to its clients or for providing advice in relation to theBookbuilding or the Placing or any other matters referred to in thisannouncement. Each Placee and any person acting on behalf of the Placee acknowledges thatHoare Govett owes no fiduciary or other duties to any Placee in respect of anyrepresentations, warranties, undertakings or indemnities in the PlacingAgreement. Each Placee and any person acting on behalf of the Placee acknowledges andagrees that Hoare Govett may (at its absolute discretion) satisfy itsobligations to procure Placees by itself agreeing to become a Placee in respectof some or all of the Placing Shares or by nominating any connected orassociated person to do so. When a Placee or any person acting on behalf of the Placee is dealing with HoareGovett, any money held in an account with Hoare Govett on behalf of such Placeeand/or any person acting on behalf of such Placee will not be treated as clientmoney within the meaning of the relevant rules and regulations of the FSA whichtherefore will not require Hoare Govett to segregate such money, as that moneywill be held by it under a banking relationship and not as trustee. Past performance is no guide to future performance and persons needing adviceshould consult an independent financial adviser. Each Placee and each personacting on behalf of the Placee acknowledges that neither Hoare Govett, nor anyof its Affiliates, is making any recommendations to it, advising it regardingthe suitability of any transactions it may enter into in connection with thePlacing nor providing advice in relation to the Placing nor in respect of anywarranties, representations, undertakings or indemnities contained in thePlacing Agreement nor the exercise or performance of Hoare Govett's rights andobligations thereunder including any rights to waive or vary any conditions orexercise any termination rights. All times and dates in this announcement may be subject to amendment. HoareGovett will notify Placees and any persons acting on behalf of the Placees ofany changes. This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
Fenner PLC