21st Jun 2005 07:02
EMAP PLC21 June 2005 THIS ANNOUNCEMENT IS NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION IN OR INTO THE UNITED STATES, CANADA, AUSTRALIA OR JAPAN RECOMMENDED CASH OFFER AT 1,088 PENCE PER SHARE BY LAZARD & CO., LTD. ON BEHALF OF EMAP PLC FOR THE ENTIRE ISSUED AND TO BE ISSUED SHARE CAPITAL OF SCOTTISH RADIO HOLDINGS PLC NOT ALREADY OWNED BY EMAP PLC Highlights * Recommended cash offer at 1,088 pence per SRH Share. * Acquisition expected to be earnings enhancing in first full year. * Agreement with Johnston Press to sell Score Press for GBP 155 million. Summary The Boards of Emap plc ("Emap") and Scottish Radio Holdings plc ("SRH") arepleased to announce that they have agreed the terms of a recommended cash offerto be made by Lazard & Co., Ltd. ("Lazard") on behalf of Emap for the entireissued and to be issued share capital of SRH not already owned by Emap. The Offer: * will be 1,088 pence in cash for each SRH Share, valuing the entire issued share capital of SRH at approximately GBP 391 million. * represents a premium of: - 17 per cent. over the average middle market closing price in the 12 month period up to and including 31 March, 2005, the date immediately prior to the commencement of the Offer Period, of 926 pence per SRH Share; - 12 per cent. over the middle market price of 974 pence per SRH Share at the close of business on 31 March, 2005; and - 9 per cent. over the middle market price of 1,002 pence per SRH Share at the close of business on 20 June, 2005, the last practicable date before the making of this announcement. * represents a historic price/earnings multiple of 26.3 times adjusted earnings per share. In addition, SRH Shareholders remain entitled to receive the interim dividend of7.5 pence per SRH Share announced on 19 May, 2005, and payable on 1 July,2005. Emap currently owns 9,729,361 SRH Shares, representing approximately 27 percent. of SRH's issued share capital. Irrevocable undertakings to accept the Offer have been received from SRHdirectors in respect of 374,479 SRH Shares representing approximately 1 percent. of the issued share capital of SRH. Emap therefore owns or has received irrevocable undertakings to accept the Offerin respect of a total of 10,103,840 SRH Shares, representing approximately 28per cent. of the issued share capital of SRH. Commenting on the Offer, Emap's Chief Executive, Tom Moloney, said: "Radio is agood business, with strong medium term growth prospects. To compete moreeffectively, scale of audience and infrastructure will be increasinglyimportant. This transaction enables us to create the highest quality independentlocal radio business, reaching all of the UK's major conurbations and deliveringa strong position in the Republic of Ireland. This is an important step inEmap's radio strategy, one that creates real value and leaves us well placed tomake the digital step that will be so important in establishing leadership of UKcommercial radio." Commenting on the Offer, SRH's Chief Executive, David Goode, said: "CombiningEmap's radio business with SRH's network of 22 highly rated stations in the UKand Republic of Ireland will create a strong national radio group with excitingprospects. Score Press is a highly profitable and well run portfolio of weeklynewspapers. It represents a very valuable asset and a good fit with JohnstonPress's extensive newspaper interests. The Offer delivers significant value forour shareholders, enabling them to realise a premium in cash." A conference call for the press will be held on +44 (0)1452 561 263 at 8.00am on21 June, 2005. A conference call for analysts will be held on +44 (0)1452 561 263 at 9.00am on21 June, 2005. This summary should be read in conjunction with and is subject to the full textof the announcement. Appendix III to the attached announcement contains definitions of certainexpressions used in this summary. ENQUIRIES EmapTom Moloney +44 (0)20 7278 1452Ian Griffiths Lazard (Financial Adviser to Emap) +44 (0)20 7187 2000Nicholas ShottGiles Roshier Hoare Govett (Joint Broker to Emap) +44 (0)20 7678 8000Hugo FisherCaroline Griffiths Citigroup (Joint Broker to Emap) +44 (0)20 7986 4000David JamesAndrew Seaton Noble Grossart (Financial Adviser to Emap) +44 (0)131 226 7011Sir Angus Grossart Brunswick +44 (0)20 7404 5959Patrick HandleyEd Williams SRH +44 (0)141 565 2200David Goode Greenhill (Financial Adviser to SRH) +44 (0)20 7440 0400Simon BorrowsBrian Cassin Bridgewell (Broker to SRH) +44 (0)20 7003 3000Ian DigheBen Money-Coutts Gavin Anderson & Co +44 (0)20 7554 1400Byron OuseyKen Cronin FURTHER INFORMATION For further information on Emap and SRH, please see www.emap.com andwww.srhplc.com respectively. This announcement does not constitute an offer to sell or an invitation topurchase any securities or the solicitation of an offer to buy any securities,pursuant to the Offer or otherwise. The Offer will be made solely by the OfferDocument and the Form of Acceptance accompanying the Offer Document, which willcontain the full terms and conditions of the Offer, including details of how theOffer may be accepted. Lazard, which is regulated in the United Kingdom by the Financial ServicesAuthority, is acting for Emap plc and no one else in connection with the Offerand will not be responsible to anyone other than Emap plc for providing theprotections afforded to clients of Lazard nor for providing advice in relationto the Offer. Hoare Govett, which is regulated by the Financial Services Authority, is actingfor Emap plc and no one else in connection with the Offer and will not beresponsible to anyone other than Emap plc for providing the protections affordedto clients of Hoare Govett nor for providing advice in relation to the Offer. Citigroup, which is regulated by the Financial Services Authority, is acting forEmap plc and no one else in connection with the Offer and will not beresponsible to anyone other than Emap plc for providing the protections affordedto clients of Citigroup nor for providing advice in relation to the Offer. Noble Grossart, which is regulated by the Financial Services Authority, isacting for Emap plc and no one else in connection with the Offer and will not beresponsible to anyone other than Emap plc for providing the protections affordedto clients of Noble Grossart nor for providing advice in relation to the Offer. Greenhill, which is regulated by the Financial Services Authority, is acting forSRH plc and no one else in connection with the Offer and will not be responsibleto anyone other than SRH plc for providing the protections afforded to clientsof Greenhill nor for providing advice in relation to the Offer. Bridgewell, which is regulated by the Financial Services Authority, is actingfor SRH plc and no one else in connection with the Offer and will not beresponsible to anyone other than SRH plc for providing the protections affordedto clients of Bridgewell nor for providing advice in relation to the Offer. Unless otherwise determined by Emap, the Offer is not being, and will not be,made, directly or indirectly, in or into or by the use of the mails of, or byany means or instrumentality (including, without limitation, facsimiletransmission, telex, telephone or e-mail) of interstate or foreign commerce of,or by any facilities of a national securities exchange of, the United States,Canada, Australia or Japan and will not be capable of acceptance by any suchuse, means, instrumentality or facility or from within the United States,Canada, Australia or Japan. Accordingly copies of this announcement are notbeing, and must not be, directly or indirectly, mailed or otherwise forwarded,distributed or sent in, into or from the United States, Canada, Australia orJapan, and persons receiving this announcement (including custodians, nomineesand trustees) must not mail or otherwise distribute or send it in, into or fromsuch jurisdiction as doing so may invalidate any purported acceptance of theOffer. Any person (including, without limitation, any custodian, nominee ortrustees) who would, or otherwise intends to, or who may have a contractual orlegal obligation to forward this announcement and/or the Offer Document and/orany related document to any jurisdiction outside the United Kingdom shouldrefrain from doing so and seek appropriate professional advice before taking anyaction. RECOMMENDED CASH OFFER AT 1,088 PENCE PER SHARE BY LAZARD & CO., LTD. ON BEHALF OF EMAP PLC FOR THE ENTIRE ISSUED AND TO BE ISSUED SHARE CAPITAL OF SCOTTISH RADIO HOLDINGS PLC NOT ALREADY OWNED BY EMAP PLC 1. Introduction The Boards of Emap and SRH are pleased to announce that they have agreed the terms of a recommended cash offer to be made by Lazard on behalf of Emap for the entire issued and to be issued share capital of SRH not already owned by Emap. The Offer: * will be 1,088 pence in cash for each SRH Share, valuing the entire issued share capital of SRH at approximately GBP391 million. * represents a premium of: - 17 per cent. over the average middle market closing price in the 12 month period up to and including 31 March, 2005, the date immediately prior to the commencement of the Offer Period, of 926 pence per SRH Share; - 12 per cent. over the middle market price of 974 pence per SRH Share at the close of business on 31 March, 2005; and - 9 per cent. over the middle market price of 1,002 pence per SRH Share at the close of business on 20 June, 2005, the last practicable date before the making of this announcement. * represents a historic price/earnings multiple of 26.3 times adjusted earnings per share. In addition, SRH Shareholders remain entitled to receive the interim dividend of 7.5 pence per SRH Share announced on 19 May, 2005, and payable on 1 July, 2005. Emap has agreed to make available a limited amount of a non-transferable non-convertible loan note alternative (the "Loan Note") to enable qualifying shareholders to roll over gains for tax purposes. Full details of the Loan Note will be provided in the Offer Document. Emap currently owns 9,729,361 SRH Shares, representing approximately 27 per cent. of SRH's issued share capital. Irrevocable undertakings to accept the Offer have been received from SRH directors in respect of 374,479 SRH Shares representing approximately 1 per cent. of the issued share capital of SRH. Emap therefore owns or has received irrevocable undertakings to accept the Offer in respect of a total of 10,103,840 SRH Shares, representing approximately 28 per cent. of the issued share capital of SRH. 2. The Offer On behalf of Emap, Lazard will offer to acquire, on the terms and subject to the conditions summarised in Appendix I to this announcement and to be set out in full in the Offer Document and the Form of Acceptance, the entire issued and to be issued share capital of SRH not already owned by Emap on the following basis: for each SRH Share 1,088 pence in cash The Offer values the whole of the issued share capital of SRH at approximately GBP391 million. The SRH Shares to be acquired pursuant to the Offer will be acquired fully paid up and free from all liens, equities, charges, encumbrances, rights of pre-emption and any other third party rights or interests whatsoever and together with all rights now or hereafter attaching thereto, including voting rights and, without limitation, the right to receive and retain in full all dividends, interests and other distributions (if any) declared, made or paid on or after the date of this announcement save for the interim dividend referred to above. 3. Recommendation The directors of SRH, who have been so advised by Greenhill, consider the terms of the Offer to be fair and reasonable. In providing its advice to the directors of SRH, Greenhill has taken into account the commercial assessments of the directors of SRH. Accordingly, the directors of SRH are recommending SRH Shareholders to accept the Offer as they have undertaken to do themselves in respect of 374,479 SRH Shares, representing approximately 1 per cent. of the existing issued share capital of SRH. 4. Background to and reasons for the Offer The Board of Emap believes that the UK commercial radio sector provides attractive medium-term growth prospects. The industry is going through a period of structural transformation driven by the two key issues of consolidation and audience fragmentation. Consolidation Consolidation is happening among broadcasters and their advertising customers. The Board of Emap believes that commercial radio companies need to invest in strong brands and high quality programming in order to grow audience share and that this share growth will help increase advertising revenues. Consolidation of broadcasters will create the scale to enable this investment to take place. The media buying sector (Emap's and SRH's advertising customers) has also been consolidating. Five companies now represent approximately 88 per cent. of the UK's advertising spend. The Board of Emap believes that advertising agencies (and their customers) want "one stop shops" from which to source national advertising. It believes they will choose their media partners based on ease of purchase which will increasingly be driven by advertising scale, audience reach and strength of brands. Fragmentation of Audiences The Board of Emap believes that the accelerating take up of digital broadcasting will result in audience fragmentation because listeners will benefit from a greater choice. Digital radio (radio stations broadcasting on DAB, Freeview, Satellite, Cable and Internet) is relatively new, but growing fast and consequently is becoming increasingly important for radio operators and their customers. The question is no longer "Will audiences migrate to digital?" but "At what rate will audiences migrate?" In an environment with more listener choice, the Board believes that scale, strong brands and distribution capacity across a wide variety of platforms will enable the combined radio businesses to compete more effectively. Excellent Combination Emap and SRH's radio businesses will create an independent local radio group with the ability to reach all major conurbations in the UK together with a strong position in the Republic of Ireland, which the Board of Emap believes will provide an enhanced service to listeners and advertisers. In particular, the Board of Emap believes that the complementary brands, skills and cultures of its and SRH's radio businesses will: * facilitate a smooth and rapid integration; * increase the reach of Emap's Big City Network through the addition of a further portfolio of strong heritage brands such as Clyde, Forth and Downtown; * create a stronger advertising offering by combining sales houses, enabling Emap to offer a "one stop shop" for its consolidating advertising customers; and * enhance the enlarged radio business's ability to successfully develop market-leading digital radio services. The Board of Emap believes that the acquisition of SRH will generate annualised cost savings of approximately GBP5million by the third full year of ownership at a cash cost of approximately GBP5million. It believes that the Acquisition will be immediately earnings enhancing on a normalised basis and will, over the medium term, deliver returns in line with the company's previously stated acquisition criteria. 5. Information on Emap Emap is a modern media business, with a portfolio of brands that bring people together. It creates "must-have" entertainment and information for customers across consumer magazines, radio, music television, the web, trade magazines and trade exhibitions. Emap's business activities focus around three main areas: * over 150 consumer magazines in the UK, France and around the world; * over 200 business to business events, magazines and conferences; and * 19 UK local analogue radio stations, seven digital music TV channels and one of the biggest digital radio networks in the UK. Emap employs around 5,500 people based in over 50 offices in the UK, France and around the world. Creativity is key and Emap prides itself on maintaining an edge by recruiting and developing creative people within a supportive environment. Emap's magazines, exhibitions and other products must constantly evolve to anticipate the changing demands and interests of its customers. Emap has an absolute commitment to invest in and develop existing products and research new ideas. In its audited accounts for the year ended 31 March, 2005, Emap's turnover was GBP1,068 million (2004: GBP1,050 million) on which it earned profit before taxation of GBP112 million (2004: GBP144 million). As at 31 March, 2005, Emap had net assets of GBP283 million. 6. Information on SRH SRH is a media company operating in the radio and local newspaper industries. The company was founded as Radio Clyde Limited in 1971 to bid for the Glasgow commercial radio licence, the third in the UK at the time. The company grew by acquiring competitors in the late 1980s and early 1990s and merged with Radio Forth in 1991. SRH acquired Morton Newspapers in 1995. Today, SRH's radio operations consist of 22 wholly-owned and two partly owned analogue radio services, one digital service and six digital radio multiplexes. These stations are principally located in Scotland (including Radio Clyde and Radio Forth) but also include radio stations in England and Wales (including Wave105FM and two stations under the Vibe brand), the Republic of Ireland (Today FM and FM104) and Northern Ireland (Downtown and Cool FM). SRH's regional press business, Score Press, consists of 45 local newspaper titles in Scotland, the Republic of Ireland and Northern Ireland with printing concentrated on 3 printing plants. SRH's titles include: the Angus County Press group in Scotland, the Morton Newspaper group in Northern Ireland, and the Kilkenny People in the Republic of Ireland. In its audited accounts for the year ended 30 September, 2004, SRH reported turnover of GBP96.3 million and profit on ordinary activities before taxation of GBP13.3 million. As at 30 September, 2004, SRH had net assets of GBP137.2 million. In its interim results to 31 March, 2005, SRH reported turnover of GBP51.9 million and a profit on ordinary activities before taxation of GBP8.7 million. As at 31 March, 2005, SRH had net assets of GBP134.6 million. 7. Emap's intentions regarding SRH's newspaper business Emap has entered into an agreement with Johnston Press under which Emap has agreed to procure the sale by SRH of such interests as SRH has in Score Press to Johnston Press following the acquisition by Emap of the whole of the issued share capital of SRH not already owned by Emap. Johnston Press has agreed to pay Emap GBP155million for such interests on a debt free/cash free basis. The Board believes that the transaction achieves a full and fair value for Score Press allowing Emap to acquire SRH as a pure play radio business. Completion of the agreement with Johnston Press is conditional on: (i) the Offer having been declared or having become unconditional in all respects in accordance with the requirements of the Code (subject to such derogations and waivers as the Panel may allow) prior to 31 December, 2005; and (ii) Emap not having waived the Offer condition referred to in paragraph (c) of Appendix I of this announcement (relating to obtaining clearance from the Irish Competition Authority in relation to the Offer). Under the agreement with Johnston Press, Emap has agreed that if SRH enters into any transaction involving the acquisition of any business, title, publication, fixed assets or shares in any company in relation to its newspapers business which requires the approval of SRH's shareholders then Emap will abstain from voting in relation to such transaction at the relevant meeting of SRH shareholders unless Emap (a) obtains the prior written approval of Johnston Press, and (b) votes in accordance with Johnston Press's instructions. In the last financial year to 30 September, 2004, Score Press reported revenues and operating profit of GBP35.1 million and GBP11.2 million respectively. As at 30 September, 2004, Score Press had net assets of GBP55.5 million. The proceeds from this disposal will be used by Emap to reduce its debt. 8. Undertakings to accept the Offer Emap has received irrevocable undertakings to accept (or procure the acceptance of) the Offer from those SRH directors who own SRH Shares in respect of their entire beneficial shareholdings. These irrevocable undertakings are legally binding and are given in respect of 374,479 SRH Shares representing in aggregate approximately 1 per cent. of the issued share capital of SRH. Such undertakings will cease to be binding if the Offer Document is not posted within 28 days of this announcement (or such later date as Emap determines with the consent of the Panel), the Offer lapses or is withdrawn. 9. Management and Employees Emap has given assurances to the Board of SRH that the existing employment rights (including pension rights) of the management and employees of SRH will be fully safeguarded. The sale of Score Press to Johnston Press will not affect those rights. 10. SRH Share Option Schemes The Offer will extend to any SRH Share unconditionally allotted or issued (including any which are so allotted or issued pursuant to the exercise of existing options granted under the SRH Share Option Schemes) whilst the Offer remains open for acceptance (or by such earlier date, not being earlier than the date on which the Offer becomes or is declared unconditional as to acceptances or, such later date as Emap may, subject to the Code and with the consent of the Panel, determine). Emap will make appropriate proposals to the participants in the SRH Share Option Schemes (to the extent such options have not been exercised or lapsed) subject to the offer becoming or being declared unconditional in all respects. 11. Disclosure of interests in SRH Emap currently owns 9,729,361 SRH Shares, representing approximately 27 per cent. of SRH's issued share capital. Save for the disclosure of Emap's interest in SRH referred to above, neither Emap, nor, so far as the Directors of Emap are aware, any person acting in concert with it, owns or controls any SRH Shares or any securities convertible or exchangeable into SRH Shares or any rights to subscribe for or purchase, or options (including traded options) in respect of, or derivatives referenced to, any such shares ("Relevant SRH Securities") nor does any such person have any arrangement in relation to Relevant SRH Securities. For these purposes "arrangement" includes any indemnity or option arrangement, any agreement or understanding, formal or informal, of whatever nature, relating to Relevant SRH Securities which may be an inducement to deal or refrain from dealing in such securities. Emap has not made any enquiries in this respect of certain parties who may be deemed by the Panel to be acting in concert with it for the purposes of the Offer. 12. Compulsory acquisition and cancellation of listing If Emap receives acceptances under the Offer in respect of, and/or otherwise acquires 90 per cent., or more of the SRH Shares to which the Offer relates, Emap intends to exercise its rights pursuant to the provisions of sections 428 to 430F of the Companies Act to acquire compulsorily the remaining SRH Shares on the same terms as the Offer. If the Offer becomes or is declared unconditional in all respects, Emap also intends to procure that SRH applies to the UK Listing Authority for the cancellation for the listing of SRH Shares on the Official List and to the London Stock Exchange for the cancellation of the admission to trading of SRH Shares on its market for listed securities. It is anticipated that such cancellation of listing and trading will take effect no earlier than 20 business days after the Offer becomes or is declared unconditional in all respects. 13. Overseas Shareholders The making and availability of the Offer outside, or to citizens, residents or nationals of jurisdictions outside, the United Kingdom ("overseas shareholders"), may be affected by the laws of the relevant jurisdictions. Overseas shareholders should fully acquaint themselves with and observe any applicable legal requirements. Further details in relation to overseas shareholders will be contained in the Offer Document. Unless otherwise determined by Emap, the Offer is not being, and will not be, made, directly or indirectly, in or into or by the use of the mails of, or by any means or instrumentality (including, without limitation, facsimile transmission, telex, telephone or e-mail) of interstate or foreign commerce of, or by any facilities of a national securities exchange of, the United States, Canada, Australia or Japan and will not be capable of acceptance by any such use, means, instrumentality or facility or from within the United States, Canada, Australia or Japan. Accordingly copies of this announcement are not being mailed, and must not be mailed, or otherwise forwarded, distributed or sent in, into or from the United States, Canada, Australia or Japan (including to SRH Shareholders with registered addresses in the United States, Canada, Australia or Japan or to persons whom Emap or its agent knows to be custodians, nominees or trustees holding SRH Shares for such persons) and persons receiving this announcement (including, without limitation, custodians, nominees and trustees) must not distribute or send this announcement in, into or from the United States, Canada, Australia or Japan or use the United States, Canadian, Australian or Japanese mails or any such means or instrumentality for any purpose directly or indirectly in connection with the Offer. Doing so may render invalid any purported acceptance of the Offer. 14. Offer documentation The Offer Document and the Form of Acceptance will be posted to SRH Shareholders (other than SRH Shareholders with addresses in the United States, Canada, Australia or Japan) as soon as practicable. In deciding whether or not to accept the Offer in respect of their SRH Shares, SRH Shareholders should rely on the information contained in, and procedures described in, the Offer Document and Form of Acceptance. The conditions of the Offer are set out in full in Appendix I to this announcement. Appendix III to this announcement contains definitions of certain expressions used in this announcement. ENQUIRIES EmapTom Moloney +44 (0)20 7278 1452Ian Griffiths Lazard & Co. (Financial Adviser to Emap) +44 (0)20 7187 2000Nicholas ShottGiles Roshier Hoare Govett (Joint Broker to Emap) +44 (0)20 7678 8000Hugo FisherCaroline Griffiths Citigroup (Joint Broker to Emap) +44 (0)20 7986 4000David JamesAndrew Seaton Noble Grossart (Financial Adviser to Emap) +44 (0)131 226 7011Sir Angus Grossart Brunswick +44 (0)20 7404 5959Patrick HandleyEd Williams SRH +44 (0)141 565 2200David Goode Greenhill (Financial Adviser to SRH) +44 (0)20 7440 0400Simon BorrowsBrian Cassin Bridgewell (Broker to SRH) +44 (0)20 7003 3000Ian DigheBen Money-Coutts Gavin Anderson & Co +44 (0)20 7554 1400Byron OuseyKen Cronin FURTHER INFORMATION For further information on Emap and SRH please see www.emap.com andwww.srhplc.com respectively. Lazard, which is regulated in the United Kingdom by the Financial ServicesAuthority, is acting for Emap plc and no one else in connection with the Offerand will not be responsible to anyone other than Emap plc for providing theprotections afforded to clients of Lazard nor for providing advice in relationto the Offer. Hoare Govett, which is regulated by the Financial Services Authority, is actingfor Emap plc and no one else in connection with the Offer and will not beresponsible to anyone other than Emap plc for providing the protections affordedto clients of Hoare Govett nor for providing advice in relation to the Offer.Citigroup, which is regulated by the Financial Services Authority, is acting forEmap plc and no one else in connection with the Offer and will not beresponsible to anyone other than Emap plc for providing the protections affordedto clients of Citigroup nor for providing advice in relation to the Offer. Noble Grossart, which is regulated by the Financial Services Authority, isacting for Emap plc and no one else in connection with the Offer and will not beresponsible to anyone other than Emap plc for providing the protections affordedto clients of Noble Grossart nor for providing advice in relation to the Offer. Greenhill, which is regulated by the Financial Services Authority, is acting forSRH plc and no one else in connection with the Offer and will not be responsibleto anyone other than SRH plc for providing the protections afforded to clientsof Greenhill nor for providing advice in relation to the Offer. Bridgewell, which is regulated by the Financial Services Authority, is actingfor SRH plc and no one else in connection with the Offer and will not beresponsible to anyone other than SRH plc for providing the protections affordedto clients of Bridgewell nor for providing advice in relation to the Offer. This announcement does not constitute an offer to sell or an invitation topurchase any securities or the solicitation of an offer to buy any securities,pursuant to the Offer or otherwise. The Offer will be made solely by the OfferDocument and the Form of Acceptance accompanying the Offer Document, which willcontain the full terms and conditions of the Offer, including details of how theOffer may be accepted. Unless otherwise determined by Emap, the Offer is not being, and will not be,made, directly or indirectly, in or into or by the use of the mails of, or byany means or instrumentality (including, without limitation, facsimiletransmission, telex, telephone or e-mail) of interstate or foreign commerce of,or by any facilities of a national securities exchange of, the United States,Canada, Australia or Japan and will not be capable of acceptance by any suchuse, means, instrumentality or facility or from within the United States,Canada, Australia or Japan. Accordingly copies of this announcement are notbeing, and must not be, directly or indirectly, mailed or otherwise forwarded,distributed or sent in, into or from the United States, Canada, Australia orJapan, and persons receiving this announcement (including custodians, nomineesand trustees) must not mail or otherwise distribute or send it in, into or fromsuch jurisdiction as doing so may invalidate any purported acceptance of theOffer. Any person (including, without limitation, any custodian, nominee ortrustees) who would, or otherwise intends to, or who may have a contractual orlegal obligation to forward this announcement and/or the Offer Document and/orany related document to any jurisdiction outside the United Kingdom shouldrefrain from doing so and seek appropriate professional advice before taking anyaction. The Panel wishes to draw attention to certain UK dealing disclosure requirementsfollowing the announcement of the Offer. The offer period is deemed to commenceat the time when an announcement is made of a proposed or possible offer, withor without terms. The disclosure requirements are set out in more detail in Rule 8 of the Code.Under the provisions of Rule 8.3 of the Code any person who, alone or actingtogether with any other person(s) pursuant to an agreement or understanding(whether formal or informal) to acquire or control relevant securities of SRH,owns or controls, or becomes the owner or controller, directly or indirectly, ofone per cent. or more of any class of securities of SRH is required to disclose,by not later than 12.00 noon (London time) on the business day following thedate of the relevant transaction, dealings in such securities of that company(or in any option in respect of, or derivative referenced to, any suchsecurities) during the period to the date on which the offer becomes or isdeclared unconditional as to acceptances or lapses or is otherwise withdrawn.Under the provisions of Rule 8.1 of the Code, all dealings in relevantsecurities of SRH by Emap or SRH, or by any of their respective "associates"(within the meaning of the Code) must also be disclosed. If you are in any doubtas to the application of Rule 8 to you, please contact an independent financialadviser authorised under the Financial Services and Markets Act 2000, consultthe Panel's website at www.thetakeoverpanel.org.uk or contact the Panel ontelephone number +44 20 7638 0129; fax +44 20 7236 7013. Appendix I Conditions and further terms of the Offer The Offer will be subject to the following conditions:- (a) valid acceptances being received (and not, where permitted, withdrawn) by not later than 3.00 p.m. on the first closing date of the Offer (or such later time(s) and/or date(s) as Emap may, with the consent of the Panel or in accordance with the Code, decide) in respect of not less than 90 per cent. (or such lower percentage as Emap may decide) in nominal value of the SRH Shares to which the Offer relates, provided that this condition shall not be satisfied unless Emap and/or any of its wholly-owned subsidiaries shall have acquired or agreed to acquire, whether pursuant to the Offer or otherwise, shares in SRH carrying in aggregate more than 50 per cent. of the voting rights then normally exercisable at general meetings of SRH; and provided further that this condition shall be capable of being satisfied only at a time when all other conditions have been satisfied or waived. For the purposes of this condition: (i) shares which have been unconditionally allotted but not issued before the Offer becomes or is declared unconditional as to acceptances, whether pursuant to the exercise of any outstanding subscription or conversion rights or otherwise, shall be deemed to carry the voting rights they will carry on being entered into the Register of Members of SRH; and (ii) the expression "SRH Shares to which the Offer relates" shall be construed in accordance with sections 428 to 430F of the Companies Act. (b) the Office of Fair Trading or the appropriate Minister in the United Kingdom indicating, in terms satisfactory to Emap, that the proposed acquisition of SRH by Emap or any matter arising therefrom (including but not limited to any public interest consideration) or related thereto will not be referred to the Competition Commission and the deadline for appealing such a decision to the Competition Appeals Tribunal having expired. (c) obtaining clearance in respect of the Offer from the Irish Competition Authority pursuant to a determination under sections 21(2)(a) (provided no direction is made by the Minister for Enterprise, Trade and Employment under section 23(2) of the Competition Act), 22(3)(a) or 22(3)(c) of the Competition Act and by the Minister for Enterprise, Trade and Employment pursuant to an order under sections 23(4)(a) or 23(4)(b) of the Competition Act or, where no such determination or order is issued, the periods specified in section 21(2), 19(1)(d) or 23(a) of the Competition Act having elapsed. (d) Ofcom confirming in writing, in terms satisfactory to Emap (acting reasonably), that it will not as a consequence whether direct or indirect of the Acquisition of any shares in and/or control of SRH by Emap: (i) vary in any material respect, suspend, revoke, reduce the licence period of, or impose a financial penalty pursuant to, any Licence; (ii) vary in any material respect the terms or conditions of the issue of any Licence to be granted by Ofcom to any member of the SRH Group or the Emap Group which has been awarded or offered to any member of the SRH Group or the Emap Group prior to 20 June, 2005; or (iii) take any action or refrain from taking any action that it would otherwise have taken, or require Emap or SRH to take any action or refrain from taking any action, in connection with any Licence(s), which would have a material adverse effect on the wider SRH Group or the wider Emap Group in each case taken as a whole and such confirmation not being subsequently revoked or adversely varied prior to the Offer becoming or being declared to be unconditional in all respects. (e) the BCI confirming in writing, in terms satisfactory to Emap (acting reasonably), that it will not as a consequence whether direct or indirect of the Acquisition of any shares in and/or control of SRH by Emap: (i) vary in any material respect, suspend, revoke, reduce the term of, or impose a financial penalty pursuant to, any Sound Broadcasting Contract; (ii) vary in any material respect the terms or conditions of the issue of any Sound Broadcasting Contract to be granted by the BCI to any member of the SRH Group which has been awarded or offered to any member of the SRH Group prior to 20 June, 2005; or (iii) take any action or refrain from taking any action that it would otherwise have taken, or require Emap or SRH to take any action or refrain from taking any action, in connection with any Sound Broadcasting Contract, which would have a material adverse effect on the wider SRH Group taken as a whole; and such confirmation not being subsequently revoked or adversely varied prior to the Offer becoming or being declared to be unconditional in all respects. (f) except as disclosed by or on behalf of SRH to Emap or its advisers or as publicly announced pursuant to the Listing Rules or on behalf of SRH in either such case prior to the release of this announcement, there being no provision of any agreement, arrangement, licence, permit or other instrument to which any member of the wider SRH Group is a party or by or to which any such member or any of its assets may be bound, entitled or subject, which in consequence of the Offer or the proposed acquisition of any shares or other securities in SRH or because of a change in the control or management of SRH or otherwise, could or might result in (to an extent material in the context of the wider SRH Group taken as a whole): (i) any monies borrowed by or any other indebtedness (actual or contingent) of, or grant available to any such member, being or becoming repayable or capable of being declared repayable immediately or earlier than their or its stated maturity date or repayment date or the ability of any such member to borrow monies or incur any indebtedness being withdrawn or materially inhibited or being capable of becoming or being withdrawn or materially inhibited; (ii) any such agreement, arrangement, licence, permit or instrument or the rights, liabilities, obligations or interests of any such member thereunder being terminated or adversely modified or adversely affected or any onerous obligation or onerous liability arising or any adverse action being taken or arising thereunder; (iii) any assets or interests of any such member being or falling to be disposed of or charged or any right arising under which any such asset or interest could be required to be disposed of or charged; (iv) the creation or enforcement of any mortgage, charge or other security interest over the whole or any part of the business, property or assets of any such member; (v) the rights, liabilities, obligations or interests of any such member in, or the business of any such member with, any person, firm or body (or any arrangement or arrangements relating to any such interest or business) being terminated, adversely modified or adversely affected; (vi) the financial or trading position or prospects being adversely affected; (vii) any such member ceasing to be able to carry on business under any name under which it presently does so; or (viii) the creation of any liability, actual or contingent, by any such member; and no event having occurred which, under any provision of any agreement, arrangement, licence, permit or other instrument to which any member of the wider SRH Group is a party or by or to which any such member or any of its assets may be bound, entitled or subject, could reasonably be considered likely to result in any of the events or circumstances as are referred to in sub-paragraphs (i) to (viii) of this paragraph (f) to an extent material in the context of the wider SRH Group taken as a whole. (g) no government or governmental, quasi-governmental, supranational, statutory, regulatory, environmental or investigative body, court, trade agency, association, institution or any other body or person whatsoever in any jurisdiction (each a "Third Party") having decided to take, institute, implement or threaten any action, proceeding, suit, investigation, enquiry or reference, or enacted, made or proposed any statute, regulation, decision or order, or having taken any other steps which would or might reasonably be expected to: (i) require, prevent or materially delay the divestiture, or materially alter the terms envisaged for any proposed divestiture by any member of the wider Emap Group or any member of the wider SRH Group of all or any material portion of their respective businesses, assets or property or (to an extent which is material in the context of the wider Emap Group and/or the wider SRH Group taken as a whole) impose any limitation on the ability of any of them to conduct their respective businesses (or any of them) or to own any of their respective assets or properties or any part thereof; (ii) require, prevent or materially delay the divestiture by any member of the wider Emap Group of any shares or other securities in SRH; (iii) impose any limitation in any material respect on, or result in a material delay in, the ability of any member of the wider Emap Group directly or indirectly to acquire or to hold or to exercise effectively any rights of ownership in respect of shares or loans or securities convertible into shares or any other securities (or the equivalent) in any member of the wider SRH Group or the wider Emap Group or to exercise management control over any such member; (iv) otherwise adversely affect the business, assets, profits or prospects of any member of the wider Emap Group or of any member of the wider SRH Group in a manner which is material in the context of the wider Emap Group or the wider SRH Group, in each case taken as a whole; (v) make the Offer or its implementation or the acquisition or proposed acquisition by Emap or any member of the wider Emap Group of any shares or other securities in, or control of SRH void, illegal, and/ or unenforceable under the laws of any jurisdiction, or otherwise, directly or indirectly, restrain, restrict, prohibit, materially delay or otherwise interfere with the same, or impose material additional conditions or obligations with respect thereto, or otherwise materially challenge or interfere therewith; (vi) require any member of the wider Emap Group or the wider SRH Group to offer to acquire any shares or other securities (or the equivalent) or interest in any member of the wider SRH Group or the wider Emap Group owned by any third party; (vii) impose any material limitation on the ability of any member of the wider SRH Group to co-ordinate its business, or any part of it, with the businesses of any other members; or (viii) result in any member of the wider SRH Group ceasing to be able to carry on business under any name under which it presently does so; and all applicable waiting and other time periods during which any such Third Party could institute, implement or threaten any action, proceeding, suit, investigation, enquiry or reference or any other step under the laws of any jurisdiction in respect of the Offer or the acquisition or proposed acquisition of any SRH Shares having expired, lapsed or been terminated. (h) all necessary filings or applications having been made in connection with the Offer and all statutory or regulatory obligations in any jurisdiction having been complied with in connection with the Offer or the acquisition by any member of the wider Emap Group of any shares or other securities in, or control of, SRH and all authorisations, orders, recognitions, grants, consents, licences, confirmations, clearances, permissions and approvals reasonably deemed necessary or appropriate by Emap or any member of the wider Emap Group (in each case acting reasonably) in respect of the Offer or the proposed acquisition of any shares or other securities in, or control of, SRH by any member of the wider Emap Group having been obtained in terms and in a form satisfactory to Emap (acting reasonably) from all appropriate Third Parties or persons with whom any member of the wider SRH Group has entered into contractual arrangements and all such authorisations, orders, recognitions, grants, consents, licences, confirmations, clearances, permissions and approvals together with all material authorisations, orders, recognitions, grants, licences, confirmations, clearances, permissions and approvals necessary or considered appropriate by Emap (acting reasonably) to carry on the business of any member of the wider SRH Group which is material in the context of the wider SRH Group taken as a whole remaining in full force and effect and all filings necessary for such purpose having been made and there being no notice or intimation of any intention to revoke or not to renew any of the same at the time at which the Offer becomes otherwise unconditional and all necessary statutory or regulatory obligations in any jurisdiction having been complied with. (i) except as disclosed in SRH's annual report and accounts for the year ended 30 September, 2004 or in SRH's unaudited interim results for the half year ended 31 March, 2005 or as publicly announced by SRH prior to the release of this announcement, no member of the wider SRH Group having, since 30 September, 2004: (i) save as for SRH Shares issued pursuant to the exercise of options granted under the SRH Share Option Schemes, issued, authorised or proposed the issue of additional shares of any class; (ii) save as for the grant of options under the SRH Share Option Schemes, issued or agreed to issue, authorised or proposed the issue of securities convertible into shares of any class or rights, warrants or options to subscribe for, or acquire, any such shares or convertible securities; (iii) recommended, declared, paid or made or proposed to recommend, declare, pay or make any bonus, dividend or other distribution whether payable in cash or otherwise; (iv) merged or demerged with any body corporate or acquired or disposed of or transferred, mortgaged or charged or created any security interest over any assets or any right, title or interest in any asset (including shares and trade investments) or authorised or proposed or announced any intention to propose any merger, demerger, acquisition or disposal, transfer, mortgage, charge or security interest, in each case; (v) made or authorised or proposed or announced an intention to propose any change in its loan capital; (vi) issued, authorised or proposed the issue of any debentures or save in the ordinary course of business incurred or increased any indebtedness or become subject to any contingent liability; (vii) purchased, redeemed or repaid or announced any proposal to purchase, redeem or repay any of its own shares or other securities or reduced or, save in respect to the matters mentioned in sub-paragraph (i) above, made any other change to any part of its share capital; (viii) implemented, or authorised, proposed or announced its intention to implement, any reconstruction, amalgamation, scheme, commitment or other transaction or arrangement or entered into or changed the terms of any contract with any director or senior executive; (ix) entered into or varied or authorised, proposed or announced its intention to enter into or vary any contract, transaction or commitment (whether in respect of capital expenditure or otherwise) which is otherwise than in the ordinary course of business and which is of a long term, onerous or unusual nature or magnitude or which is or could reasonably be considered to be restrictive on the businesses of any member of the wider SRH Group or the wider Emap Group or which involves or could involve an obligation of such a nature or magnitude in a manner which is material in the context of the wider SRH Group; (x) taken any corporate action or had any legal proceedings started or threatened against it for its winding-up, dissolution or reorganisation or for the appointment of a receiver, administrative receiver, administrator, trustee or similar officer of all or any of its assets or revenues or any analogous proceedings in any jurisdiction or had any such person appointed; (xi) entered into any contract, transaction or arrangement which would be restrictive on the business of any member of the wider SRH Group or the wider Emap Group; (xii) waived or compromised any claim otherwise than of an immaterial amount in the ordinary course of business; or (xiii) entered into any contract, commitment, arrangement or agreement or passed any resolution or made any offer (which remains open for acceptance) with respect to or announced any intention to, or to propose to, effect any of the transactions, matters or events referred to in this condition; and, for the purposes of paragraphs (ix) and (xi) of this condition, the term "SRH Group" shall mean SRH and its wholly-owned subsidiaries. (j) since 30 September, 2004 and save as disclosed in SRH's accounts for the year then ended or SRH's unaudited interim results for the half year ended 31 March, 2005 and save as publicly announced in accordance with the Listing Rules by SRH prior to the release of this announcement: (i) no adverse change or deterioration having occurred in the business, assets, financial or trading position or profits or prospects of any member of the wider SRH Group which is material in the context of the wider SRH Group taken as a whole; (ii) no litigation, arbitration proceedings, prosecution or other legal proceedings to which any member of the wider SRH Group is or may become a party (whether as a plaintiff, defendant or otherwise and excluding minor debt recovery actions in the ordinary course of business) and no investigation by any Third Party against or in respect of any member of the wider SRH Group having been instituted, announced or threatened by or against or remaining outstanding in respect of any member of the wider SRH Group which, in any case, is material in the context of the wider SRH Group taken as a whole; (iii) no contingent or other liability having arisen or become apparent to Emap which in each case is material in the context of the wider SRH Group taken as a whole; and (iv) no steps having been taken which are likely to result in the withdrawal, cancellation, termination or material modification of any licence held by any member of the wider SRH Group. (k) except as disclosed in SRH's annual report and accounts for the year ended 30 September, 2004 or in SRH's unaudited interim results for the half year ended 31 March, 2005 or as publicly announced by SRH prior to 20 June, 2005, Emap not having discovered: (i) that any financial, business or other information concerning the wider SRH Group as contained in the information publicly disclosed at any time by or on behalf of any member of the wider SRH Group is misleading in any material respect, contains a material misrepresentation of fact or omits to state a fact necessary to make that information not misleading in any material respect; (ii) that any member of the wider SRH Group or any partnership, company or other entity in which any member of the wider SRH Group has, in each case, a significant economic interest and which is not a subsidiary undertaking of SRH, is subject to any liability (contingent or otherwise) which in each case is material in the context of the wider SRH Group taken as a whole and which is not disclosed in the annual report and accounts of SRH for the year ended 30 September, 2004 or in the unaudited interim results of SRH for the half year to 31 March, 2005; or (iii) any information which materially affects the import of any information disclosed at any time by or on behalf of any member of the wider SRH Group. (l) except as disclosed in SRH's annual report and accounts for the year ended 30 September, 2004 or in SRH's unaudited interim results for the half year ended 31 March, 2005 or as publicly announced by SRH prior to 20 June, 2005, Emap not having discovered that: (i) any past or present member of the wider SRH Group has failed to comply with any and/or all applicable legislation or regulation, of any jurisdiction with regard to the disposal, spillage, release, discharge, leak or emission of any waste or hazardous substance or any substance likely to impair the environment or harm human healthRelated Shares:
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