30th Jan 2008 13:15
Kesa Electricals plc30 January 2008 30 January 2008 Proposed Sale of BUT to a consortium composed of Colony Capital, Goldman Sachs and Merchant Equity Partners for €550 million Further to the announcement made on 28 December 2007, Kesa Electricals plc (the"Company") confirms today the exchange of a Sale and Purchase Agreement for theproposed sale of the BUT Group (the Company's furniture and electricalsbusiness), to Decomeubles Partners SAS (a company backed by a consortiumcomposed of Colony Capital, Goldman Sachs and Merchant Equity Partners (togetherthe "Purchaser")) for €550 million enterprise value, subject to adjustment fordebt and other items (the "Disposal"). Jean-Noel Labroue, Chief Executive of KESA Electricals plc, said: "Having received some unsolicited offers of interest to acquire BUT in mid 2007it was felt to be an opportune time in BUT's development to consider its longterm position within the Group and to realise the value inherent in the BUTGroup." Highlights: The BUT Group is being sold to the Purchaser for a total cash consideration,payable on Completion by the Purchaser, of €550 million; (a) net of third party indebtedness;(b) net of cash;(c) net of intercompany debt between the BUT Group and the Retained Group; and(d) net of variations in normalised working capital, as at the date of Completion. The consideration will be adjusted accordingly ona euro for euro basis. The Disposal is also conditional on various conditions being satisfied, whichare more fully set out in footnote 1 below. The Sale and Purchase Agreement shall terminate if the conditions are not met by26 March 2008. In addition, Kesa is obliged to pay a termination indemnity tothe Purchaser of €5.5 million if Shareholders of the Company choose not toapprove the Disposal. The Disposal is expected to complete during March 2008. The Board has decided that, following the receipt of proceeds from the Disposal,it will put in place an on-market share repurchase programme to return aproportion of the net proceeds. The Company will remain flexible in relation tothe timing and amount of the share repurchases, taking into account Company'sshare price, balance sheet and cashflow, and any opportunities which might ariseto make bolt-on acquisitions on attractive terms. The circular containing further details of the Disposal, and including morespecific information on these proposals and setting out the notice of theExtraordinary General Meeting will be sent to Shareholders as soon aspracticable. Ends Contacts: Analysts Kesa Electricals plcSimon Ward +44 (0) 20 7269 1400 Media Kesa Electricals plcAnnabel Donaldson UK +44 (0) 20 7269 1400 FinsburyAlex Pettifer UK +44 (0) 20 7251 3801 Euro RSCGBenjamin Perret France +33 (0) 1 58 47 95 17 Basic Facts about KESA Electricals plc and BUT Kesa Electricals plc is a holding company with subsidiaries operating through796 stores in twelve European countries. It is Europe's third largest electricalretailing group by sales. The Group comprises four operating divisions: Darty (France), BUT (France),Comet (UK) and Other businesses which consists of Vanden Borre (Belgium), BCC(Holland), Datart (Czech Republic and Slovakia), Darty (Italy), Darty(Switzerland), Menaje del Hogar ( Spain and Portugal) and Darty (Turkey). Kesa Electricals' businesses share a trading philosophy based on threeprinciples: Best Price, Best Choice and Best Service. This distinctive customerproposition is designed to address the needs of a broad customer base, to createstrong customer brand loyalty and to deliver a business model that is bothprofitable and cash generative. This model has a track record of success withinKesa Electricals and is being rolled out across the Group's businesses in linewith changing customer aspirations, so as to differentiate Kesa Electricals'retail brands from those of its competitors. The Group's revenue for the year ended 31 January 2007 was £4,500.9 million andits profit before tax was £165.4 million, of which £595.7 million and £33.9million respectively were attributable to the BUT Group. As at 31 January 2007,the Group had net assets of £370.7 million and gross assets of £1,980.4 millionof which £380.7 million and £537.6 million respectively were attributable to theBUT Group. The Group's revenue for the six months ended 31 July 2007 was £2,044.2 millionand its profit before tax was £32.4 million, of which £276.1 million and £15.3million respectively were attributable to the BUT Group. As at 31 July 2007, theGroup had net assets of £347.3 million and gross assets of £1,963.9 million, ofwhich £394.6 million and £545.9 million were attributable to the BUT Group. Footnote 1This Disposal is conditional on the following being satisfied: (i) approval by any necessary national or supranational merger control authorities;(ii) approval from CECEI (the French banking regulatory body) in connection with the indirect acquisition by the Purchaser of BUT's 49 per cent. shareholding in its French subsidiary, FIDEM;(iii) clearance from the Luxembourg Commissariat aux Assurances and from the relevant Luxembourg Minister in connection with the indirect acquisition by the Purchaser of the Luxembourg BUT subsidiary, CAFINA;(iv) receipt by BUT from CETELEM of the waiver on the exercise by it of certain call option rights consequent upon the proposed change of control;(v) receipt by BUT from FIDEM of the waiver of certain termination rights consequent upon the proposed change of control;(vi) no material adverse change having occurred in the BUT Group business;(vii) the aggregate value of freehold properties, owned by BUT Group but in respect of which it has not, before completion, been possible to establish title as required under French law, not exceeding €53 million;(viii)receipt by the Purchaser by no later than 25th March 2008 of audited consolidated financial accounts for BUT SAS for the 12month period ended 31 January 2008; and(x) the passing of an ordinary resolution approving the Disposal by Shareholders of the Company at its Extraordinary General Meeting. This announcement is for information purposes only and does not constitute anoffer or invitation to acquire or dispose of any securities or investment advicein any jurisdiction. UBS Investment Bank is joint broker to KESA Electricals plc and has providedfinancial advice on the proposals announced today. Merrill Lynch International is joint broker to KESA Electricals plc and hasprovided financial advice on the proposals announced today. Lazard and Co., Limited, and Lazard Freres S.A.S.are acting for Kesa Electricalsplc and for no one else in connection with the Disposal and will not beresponsible to anyone other than Kesa Electricals plc for providing theprotections afforded to clients of Lazard and Co., Limited, and Lazard FreresS.A.S. or for affording advice in relation to the Disposal, the contents of thisdocument or any transaction, arrangement or other matter referred to in thisdocument. Overseas Shareholders should inform themselves about and observe any applicablelegal or regulatory requirements. If you are in any doubt about your position,you should consult your professional advisor in the relevant territory. This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
DRTY.L