20th Feb 2007 11:00
Not for release, publication or distribution directly or indirectly into theUnited States, Canada, Australia or Japan or to US persons (as defined in theUS Securities Act of 1933, as amended).SHIRE AGREES TO ACQUIRE NEW RIVER TO GAIN FULL CONTROL OF VYVANSE¢â€ž¢, ITS FUTURE FLAGSHIP PRODUCT FOR ADHD All cash transaction for $2.6 billion funded by $2.3 billion new debt facilities and approximately $800 million equity financing. FINAL
Basingstoke, UK - February 20, 2007 - Shire plc ("Shire" or the "Company") announces today that it has agreed toacquire New River Pharmaceuticals, Inc. ("New River") for $64per New River share, or approximately $2.6 billion for the fully diluted equityinterest, in an all cash transaction unanimously recommended by the Boards ofboth companies.In January 2005, Shire entered into a collaborative agreement with New River todevelop and co-promote NRP104, now known as VYVANSE¢â€ž¢ (lisdexamfetaminedimesylate), for Attention Deficit and Hyperactivity Disorder ("ADHD") beforePhase 2 data were available. In December 2006, New River received a secondapprovable letter for VYVANSE from the US Food and Drug Administration ("FDA")and, as previously announced, Shire plans to launch VYVANSE for the pediatricindication and file a supplemental New Drug Application ("sNDA") for the adultindication in the second quarter of 2007. Shire is confident that the finalterms of the expected FDA approval will provide a strong and differentiatedplatform for the successful launch of VYVANSE.The acquisition of New River will allow Shire to capture the full economicvalue of VYVANSE, and gain control of the future development andcommercialization of this product. This is consistent with Shire's alreadystated focus on the growing ADHD market and allows the Company to progress andbenefit from its successful strategy of acquiring, developing and marketingspecialty products. In addition, the acquisition will provide Shire with accessto potentially attractive new specialty drug candidates and technology.Shire plans to raise approximately $800 million by way of an accelerated bookbuilt private placing of ordinary shares to certain institutional investorsimmediately following this announcement to part-finance the acquisition. Theremainder of the purchase consideration will be funded by debt.The acquisition is structured as a tender offer for all outstanding shares ofNew River followed by a merger. The acquisition is subject to the approval ofShire's shareholders as well as the satisfaction of certain customaryconditions, including the tender of a majority of the outstanding New Rivershares on a fully-diluted basis and the expiration or earlier termination ofthe Hart-Scott-Rodino waiting period. We expect the tender offer to becommenced by March 2, 2007 and to close early in April 2007, unless extended.Mr R.J. Kirk, New River's CEO, who beneficially owns 50.2% of the totaloutstanding shares of New River common stock (or 46% on a fully diluted basis)has agreed pursuant to a tender and support agreement with Shire that he willtender his shares in the tender offer.
Shire Chief Executive Officer, Matthew Emmens, said:
"This is an important and complementary acquisition that gives us full controlof VYVANSE, a novel drug. We are confident and expect that the final labelingwill provide patients, parents and physicians with real benefits thatdifferentiate this compound from other ADHD products. It will enable us todrive the launch and future development of VYVANSE and gain the full economicbenefits of the drug. Based on VYVANSE's expected profile, we believe it hasthe potential to be the next generation stimulant product to ADDERALL XR‚®. Thisacquisition continues our leadership position in the growing US ADHD market,improves our operating margins, significantly enhances our earnings growth fromlate 2009 and delivers on our overall global growth strategy. The combined debtand equity financing announced today enables us to both acquire New River andretain the financial flexibility to make further acquisitions that willcontinue to drive Shire's growth."
Acquisition Rationale:
VYVANSE represents the future flagship product for ADHD
* Shire is confident in its ability to make VYVANSE the leading treatment in
the ADHD market and, as Shire has demonstrated historically, to transition
successfully the majority of patients from its current market leading
product (ADDERALL XR) to the next generation prodrug ADHD product (VYVANSE)
* VYVANSE, as a New Chemical Entity (NCE), represents an important innovation
in ADHD treatment with a favorable therapeutic profile for pediatric ADHD
patients
* In clinical studies designed to measure duration of effect, VYVANSE
provided significant efficacy compared to placebo for the full treatment
day, up to, through and including 6:00 pm
* In two clinical human drug abuse studies, VYVANSE produced subjective
responses on a scale of "Drug Liking Effects" (DLE) that were significantly
less than d-amphetamines in the case of oral administration and less in the
case of intravenous administration at equivalent dosages. DLE is used in
clinical abuse studies to measure relative preference among known substance
abusers
* VYVANSE has robust intellectual property with patent protection through to
June 2023 in the US and through to June 2024 in Europe
Opportunity to fully control development and commercialization strategy for V YVANSE
* Shire can leverage its ADHD expertise to maximize the value of VYVANSE's
development program, including pursuing further studies in ADHD and additional product indications * Establishes a single voice to the key opinion leaders for the product, based on Shire's already strong ADHD position in the US. Consistent marketing program to be delivered through a single experienced sales organization
* Enhances Shire's existing excellent relationship with ADHD physicians and
the patient community
* Opportunity to maximize VYVANSE's potential in North America and Europe
Attractive market opportunities
* Current US ADHD market worth $3.3 billion with current estimated yearly
market prescription volume growth at 4% which Shire expects to rise to 6%
with the introduction of new products * Major opportunity in adult ADHD market *
+ Currently makes up close to 40% of total ADHD prescriptions and adult
prescription volume grew 9% over 2005
+ Market data estimates that 75% of adult ADHD patient population in the
US remain undiagnosed, under-treated or untreated * Major opportunities for ADHD in growing European markets * + Shire plans to file VYVANSE for European approvals for pediatric indication in 2009
Acquisition allows Shire to capture fully the future profits of VYVANSE. It is expected to enhance significantly Shire's medium and long-term earnings per share (EPS) growth
* Significantly enhances Shire's operating margin through elimination of
VYVANSE's profit share and royalties
* Expected to be cash EPS and US GAAP EPS neutral in 2009 and significantly
earnings enhancing from late 2009 * Effective use of Shire's balance sheet and cash generation * Shire retains financial flexibility to make further acquisitions
Adds to Shire's product pipeline and broadens technology platform
* NRP290 (phase 2 for acute pain) * NRP409 (pre-clinical) for use in treatment of hypothyroidism
* Ownership of patented CARRIERWAVE¢â€ž¢ platform technology, with potential
application in reduced drug abusability
A circular providing further details of the acquisition and convening an Extraordinary General Meeting of Shire shareholders will be posted to Shire shareholders in due course.
Shire also announces today its results for the twelve months to December 31, 2006, which demonstrate the continued strong growth of its ADHD portfolio. Please refer to the separate press release.
Analysts' conference calls and presentation
A conference call will be held for analysts at 12noon GMT / 7am EDT today, February 20, 2007. Please dial USA / Canada toll free: 1 866 793 4279 or UK toll free 0800 358 2705 or Standard International Dial In: +44 (0) 20 8609 0205, password: 292846#.
Please call [ ] on [ ] or [ ] on [ ] if further details regarding the call are required.
There will also be a live audio webcast at www.Shire.com.
For further information please contact:
Investor Relations Clĩa Rosenfeld (Rest of the World) +44 1256 894 160 Eric Rojas and Brian Piper (North +1 484 595 8252 America) Media Jessica Mann (Rest of the World) +44 1256 894 280 Matt Cabrey (North America +1 484 595 8248 Joint BookrunnersMorgan Stanley (Peter Moorhouse) +44 207 677 2395Deutsche Bank (Charlie Foreman) +44 207 547 6843Goldman Sachs (Joshua Critchley) +44 207 774 3109
Shire plc
Shire's strategic goal is to become the leading specialty pharmaceuticalcompany that focuses on meeting the needs of the specialist physician. Shirefocuses its business on ADHD, human genetic therapies (HGT), gastrointestinal(GI) and renal diseases. The structure is sufficiently flexible to allow Shireto target new therapeutic areas to the extent opportunities arise throughacquisitions. Shire believes that a carefully selected portfolio of productswith a strategically aligned and relatively small-scale sales force willdeliver strong results.Shire's focused strategy is to develop and market products for specialtyphysicians. Shire's in-licensing, merger and acquisition efforts are focused onproducts in niche markets with strong intellectual property protection eitherin the US or Europe.
For further information on Shire, please visit the Company's website: www.Shire.com.
About New River
New River Pharmaceuticals Inc. is a specialty pharmaceutical company developingpharmaceuticals that are generational improvements of widely prescribed drugsin large and growing markets. New River was founded in 1996 by R.J. Kirk,Chairman and Chief Executive Officer, who is the principal shareholder with50.2% of the outstanding shares of New River common stock (46% on a fullydiluted basis).
New River is developing new molecular entities that are derivatives of public domain active compounds using its proprietary CARRIERWAVE technology.
New River currently has three active programs in clinical or pre-clinical development stages:
* VYVANSE, New River's principal product candidate, is under FDA review for
the treatment of ADHD in pediatric populations
* NRP290 (Phase 2) is being developed to treat acute pain and is intended to
be a safer, more abuse-resistant and more effective alternative to
currently marketed opioids
* NRP409 (pre-clinical) is being developed as a replacement or supplemental
therapy in patients with primary hypothyroidism and other indications
As at October 1, 2006 New River had total assets of $169,915,935. For the ninemonths ended October 1, 2006 New River reported collaboration revenues of$31,850,530 and recorded an operating loss of $12,375,644 (operating loss forfull year 2005: $31,751,617).The Management of New River comprises of R.J. Kirk, Chairman and ChiefExecutive, Krish Krishnan, Chief Operating Officer and Chief Financial Officer,Garen Z. Manvelian M.D., Chief Medical Officer, John K. Thottathil, Ph.D. -Chief Scientific Officer, Suma M. Krishnan, Vice President, ProductDevelopment, Samir D. Roy Ph.D, Vice President, Formulation and Manufacturing,Clifton R. Hendon II, Vice President, Finance and Controller, and James P.Shaffer, Vice President, Sales and Marketing.
Background to collaboration between New River and Shire
In January 2005 Shire entered into a collaborative agreement with New River forthe development of VYVANSE for the treatment of ADHD, before Phase 2 wereavailable for the drug. On 21 December 2006, the FDA issued a second approvableletter to New River for VYVANSE and, following this, Shire is preparing for theUS launch of the pediatric indication of VYVANSE in the second quarter of 2007.The US Prescription Drug User Fee Act date for the pediatric indication of thisdrug is 24 February 2007. The FDA has proposed that VYVANSE be classified as aSchedule II controlled substance under the US Controlled Substances Act. Thisproposal has been submitted to the US Drug Enforcement Administration (DEA) anda final scheduling decision is anticipated within two months of approval. OnceVYVANSE receives final scheduling designation by the DEA, it will be availablein three dosage strengths: 30 mg, 50 mg and 70 mg, all indicated for once-dailydosing.While both companies have jointly developed VYVANSE to date, a launch strategydriven by a single organization with substantial experience in the ADHD marketwill maximize the potential for the product. In particular, Shire'slongstanding patient and physician relationships established over the lastdecade through the ADDERALL franchise will be fully leveraged to ensure optimalpositioning of VYVANSE in North America and Europe.VYVANSE is an innovative drug that addresses significant medical need and itsunique technology could potentially limit the absorption to doses within thetherapeutic range and make it less suitable for abuse.
Shire has successfully commercialized specialty pharmaceutical products in the major pharmaceutical markets of North America and Europe and it expects to leverage this capability to realize the full potential of VYVANSE.
Shire's ADHD portfolio, VYVANSE's potential and market dynamics
The current US ADHD market is estimated to be worth $3.3 billion with yearlyprescription volume market growth at 4% in 2006 which Shire expects to rise to6% in 2007 with the introduction of new products. Shire also expects the marketto grow further in the future along with the expansion into new geographicareas and new patient populations.
Shire believes that there are major opportunities for ADHD in European markets and Shire plans to file VYVANSE for European approvals in 2009.
Market data estimates that 9.9 million adults in the US suffer from ADHD, andthat 75% of these people remain undiagnosed, under-treated or untreated. Theadult segment now makes up close to 40% of the new prescriptions written in themarket place.
VYVANSE has been developed for adult as well as for pediatric use. Shire expects to file the sNDA for the adult indication in Q2 2007. If accepted as a sNDA the review period is expected to be 180 days.
Shire has a leading position in the US ADHD market with ADDERALL XR andDAYTRANA¢â€ž¢, and also has two additional products in registration; SPD465 (highdose mixed-amphetamine salts for adults) and SPD503 (extended releaseguanfacine, non-stimulant agent for pediatric use). With VYVANSE expected toreplace ADDERALL XR, Shire's portfolio of ADHD products will have a widespreadposition in this growing market.
Financial impact
The acquisition of New River is expected to enhance significantly Shire's medium and long-term EPS growth. It will also allow Shire to fully capture the future profits of VYVANSE and improve operating margin performance.
The acquisition is expected to be cash EPS and US GAAP EPS neutral in 2009 and significantly earnings enhancing from late 2009.
It is anticipated that the value of the pediatric indication of VYVANSE(approximately $1bn) will be recognized as an intangible asset, together withan associated deferred tax liability of approximately $0.4bn on the balancesheet. The intangible asset will be amortized over its useful economic life(approximately 20 years). There will also be a one-time charge of approximately$2 bn on closing of the acquisition relating mainly to the write-off, under USGAAP, of the intangible asset value associated with the acquired in-process R&Dpipeline (including the adult indication), together with some integration andtransaction costs.
The financing announced today enables Shire to both acquire New River and retain financial flexibility to make further acquisitions in other areas that will continue to drive Shire's growth.
Additional New River products
NRP290, New River's most advanced compound (Phase 2) after VYVANSE, is a Conditionally Bioreversible Derivative (CBD) of hydrocodone, an opioid widely used in combination with other non-opioid analgesics to treat acute pain
* Acute pain usually lasts for a short time, typically not more than a month.
Treatment for acute pain may consist of non-opioid analgesics and
non-steroidal anti-inflammatory drugs. In more severe cases of acute pain,
opioids are commonly prescribed. While opioids are the most effective drugs
available for treating pain, there is increasing concern with respect to
their potential for abuse and propensity for addiction * Repeated administration of opioids, including hydrocodone, can create psychological addiction as well as increased tolerance resulting in the potential for overdose. Overdose can result in respiratory depression, coma, hypotension, cardiac arrest and death
* On June 28, 2005, New River filed an Investigational New Drug Application
(IND) with the FDA. On September 12, 2005, New River presented the results
of its first clinical trial on NRP290. Further clinical development is
ongoing
NRP409 (pre-clinical) is being developed as a replacement or supplemental therapy in patients with primary hypothyroidism and other indications
* New River's CARRIERWAVE triiodothyronine (T3) hormone is being developed as
a replacement or supplemental therapy in patients with primary hypothyroidism and other indications. The leading thyroid Hormone Replacement Therapies (HRTs) are based on tetraiodothyronine (T4), and require deiodination within the patient to convert to the more active
hormone (T3). Patients demonstrate significant variability in their ability
to convert the T4 hormone in the HRT into T3. This variability can arise as
a function of age, stress or a variety of medical conditions. Commercially
approved drugs based on T3, however, engender certain safety risks, most
notably cardiovascular in nature
* NRP409 will mark a significant improvement in thyroid HRT by reducing the
variability of the more active hormone's availability, while reducing the
safety risk associated with other T3 based therapies
* New River filed an IND for NRP409 in the second quarter of 2006
New River patented technology
In addition to the above products, the acquisition provides Shire access to NewRiver's CARRIERWAVE technology. This proprietary technology enables the designof proprietary compounds consisting of active pharmaceutical ingredients boundto adjuvants. The adjuvants are comprised of various substances such aspeptides, amino acids, lipids and nucleic acids. New River believes that thebreakdown of the active from the adjuvant occurs at specifically targeted sitesof enzymatic activity in the body. In the case of its current CARRIERWAVEcompounds, the site of enzymatic activity is primarily in the gastrointestinaltract. At the target site, enzymes hydrolyze or cleave the adjuvant from theactive pharmaceutical ingredient, releasing the active pharmaceuticalingredient into circulation.New River believes that the CARRIERWAVE technology has particular applicationin overcoming the drawbacks associated with drugs of abuse and addiction, likeamphetamines and opioids while providing efficacy similar to currently marketedversions. CBDs are intended for oral delivery. In the case of amphetamines andopioids, they are designed to limit the release of the active pharmaceuticalingredient from the CBD at greater than therapeutically prescribed amounts, andto be inactive when administered other than orally.
Terms of the Transaction
The acquisition will be effected pursuant to a merger agreement (MergerAgreement). Under the terms of the Merger Agreement, a subsidiary of Shire willcommence a tender offer for all outstanding shares of New River common stock ata price of $64 per share in cash no later than March 2, 2007. Following thecompletion of the tender offer, any remaining shares of New River will beacquired in a cash merger at the same price. The transaction values New River'sshare capital as of the date of the Merger Agreement, at $2.6 billion on afully diluted basis. The acquisition price represents a premium ofapproximately: * 10% to New River's closing share price of $58.35 on February 16, 2007 (being the last business day prior to this announcement); and * 14% to $55.92, the average New River closing share price over the four weeks prior to the date of this announcement.
The transaction has been unanimously recommended by the boards of both companies.
The acquisition is structured as a tender offer for all outstanding shares ofNew River followed by a merger. The acquisition is subject to the approval ofShire's shareholders as well as the satisfaction of certain customaryconditions, including the tender of a majority of the outstanding New Rivershares on a fully-diluted basis and the expiration or earlier termination ofthe Hart-Scott-Rodino waiting period. We expect the tender offer to becommenced by March 2, 2007 and to close early in April 2007, unless extended.The Merger Agreement contains provisions relating to the payment of break feesby Shire and New River. New River is obliged to pay Shire $70 million andreimburse Shire for up to $8 million in expenses in the event that the mergeris terminated in specified circumstances. Shire is obliged to pay New River $70million and reimburse New River for up to $8 million in expenses in the eventthat the Merger Agreement is terminated as a result of, among other things, (i)Shire shareholders not approving the acquisition, (ii) the board of directorsof Shire changing its recommendation in respect of the transaction, or (iii)the board of directors of Shire not complying with its obligations under theMerger Agreement to convene an Extraordinary General Meeting of Shireshareholders.R.J. Kirk, New River's CEO, owns 50.2% of the outstanding shares of New Rivercommon stock (46% on a fully diluted basis), has agreed, pursuant to a tenderand support agreement with Shire that, he will tender his shares in the tenderoffer. If the Merger Agreement is terminated, however, including by reason ofNew River accepting an offer from a third party that the New River board ofdirectors deems to be superior to the transactions contemplated by the MergerAgreement, the tender and support agreement also terminates.
Financing of the Transaction
The total consideration for the acquisition of New River amounts toapproximately $2.6 billion in cash. Shire has entered into new bank facilitiesof $2.3 billion to provide part of the finance for the acquisition. This newfacility is conditional upon, amongst other things, approval being given byShire shareholders at an Extraordinary General Meeting for the Shire Group toexceed the limit on its aggregate borrowings set out in Shire's Articles ofAssociation.Shire also intends to raise approximately $800 million through a privateplacing of new Shire ordinary shares of 5p each (the "Placing Shares") arrangedand fully underwritten by Goldman Sachs, Morgan Stanley and Deutsche Bank (the"Placing").The Placing will be executed by way of an accelerated book built placing to belaunched immediately following this announcement. The Placing will be conductedin accordance with the terms and conditions set out in the Appendix to thisannouncement.Based on the closing price of Shire shares on the London Stock Exchange on 19February 2007 of ‚£10.75, an $800m equity issue would result in the issue ofapproximately 38 million Placing Shares, representing approximately 7.5% of thecurrent outstanding ordinary share capital of Shire. The Placing will bestructured as a private placement of shares in the United Kingdom andinternationally. Goldman Sachs, Morgan Stanley and Deutsche Bank will beconducting the Placing as joint lead managers and book runners. The bookbuilding process is expected to close today at 9.00pm GMT, and pricing andallocation announced thereafter but may be closed earlier or later at thediscretion of Goldman Sachs, Morgan Stanley and Deutsche Bank.
The placing price of the Placing Shares will be determined by Goldman Sachs, Morgan Stanley and Deutsche Bank at the close of the book build process and announced as soon as practicable following such determination.
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 Shire,including the right to receive all dividends and other distributions declared,made or paid in respect of such ordinary shares after the date of issue of thePlacing Shares. The Company reserves the right to reduce or seek to increasethe amount to be raised pursuant to the Placing, at its discretion.Application will be made for the Placing Shares to be admitted to the OfficialList maintained by the Financial Services Authority and to be admitted totrading by the London Stock Exchange plc on its market for listed securities("Admission"). Admission is expected to take place on or before 26 February2007.The Placing is not conditional upon the completion of the acquisition or theapproval of Shire's shareholders. Shire currently intends that, if theacquisition is not completed, the proceeds from the Placing will be returned toshareholders in the most efficient manner.
On the assumption that the Placing proceeds, the Company has undertaken, subject to certain limited exceptions, not to issue any additional shares for a period of 40 days.
The Appendix to this announcement sets out further information and terms and conditions of the Placing.
Financial information and current results
Shire today announced its preliminary results for the 2006 financial year. In2006, Shire achieved total revenues of $1,796 million and net income of $278million. Fully diluted earnings per ordinary share for 2006 were 54.6 cents. Asof December 31, 2006 Shire had $1,127 million in cash and cash equivalents. For2007 guidance and further information please refer to Shire's 2006 year endearnings release or visit: www.Shire.com.
Goldman Sachs and Morgan Stanley acted as financial advisors to Shire in relation to the acquisition.
Additional Information
The tender offer described in this press release has not yet commenced, andthis press release is neither an offer to purchase nor a solicitation of anoffer to sell New River common stock. Investors and security holders are urgedto read both the tender offer statement and the solicitation/recommendationstatement regarding the tender offer described in this report when they becomeavailable because they will contain important information. The tender offerstatement will be filed by a subsidiary of Shire with the Securities andExchange Commission (SEC), and the solicitation/recommendation statement willbe filed by New River with the SEC. Investors and security holders may obtain afree copy of these statements (when available) and other documents filed byShire or New River with the SEC at the website maintained by the SEC atwww.sec.gov. The tender offer statement and related materials may be obtainedfor free by directing such requests to Shire at Hampshire InternationalBusiness Park, Chineham, Basingstoke, Hampshire, England, RG24 8EP, attention:Investor Relations. The solicitation/recommendation statement and such otherdocuments may be obtained by directing such requests to New River at 1881 GroveAvenue, Radford, Virginia 24141, attention: Director of CorporateCommunications.
General
This announcement is for information only and does not constitute an offer orinvitation to acquire or dispose of any securities or investment advice in anyjurisdiction. Past performance is no guide to future performance and personsneeding advice should consult an independent financial adviser.The information contained in this announcement is not for release, publicationor distribution, directly or indirectly in or into the United States, Canada,Australia or Japan or to US persons. This announcement is not an offer to buyor acquire any securities in the capital of Shire in the United States, Canada,Australia or Japan or any jurisdiction in which such offer or solicitation isunlawful and should not be relied upon in connection with any decision toacquire the Placing Shares or any other securities in the capital of Shire. ThePlacing Shares have not and will not be registered under the US Securities Actof 1933, as amended, or under the laws of any state of the United States andmay not be offered or sold directly or indirectly, in the United States or to,absent registration or an exemption from registration. In addition, the PlacingShares may not be offered or sold to, or for the account or benefit of, USpersons (i) as part of their distribution or (ii) otherwise until 40 days afterthe closing date of the offering, except in either case in accordance withRegulation S under the US Securities Act of 1933. Terms used herein have themeanings given to them by Regulation S under the US Securities Act of 1933.There will be no public offering of securities in the United States, the UnitedKingdom or anywhere else.This announcement is only addressed to and directed at persons in member statesof the European Economic Area ('EEA') who are 'qualified investors' within themeaning of Article 2(1)(e) of the Prospectus Directive (Directive 2003/71/EC)('Qualified Investors'). Any person in the EEA who initially acquires anysecurities in the Placing or to whom any offer of securities is made will bedeemed to have acknowledged and agreed that they are such a Qualified Investor.In the case of any securities acquired by a financial intermediary as that termis used in Article 3(2) of the Prospectus Directive, such financialintermediary will also be deemed to have represented, acknowledged and agreedthat the securities acquired by it in the Placing have not been acquired on anon-discretionary basis on behalf of, nor have they have been acquired with aview to their offer or resale to, persons in circumstances which may give riseto an offer of securities to the public other than their offer or resale in arelevant member state to Qualified Investors or in circumstances in which theprior consent of Goldman Sachs, Morgan Stanley and Deutsche Bank has beenobtained to each such proposed offer or resale.No prospectus has been or will be published in connection with the Placing.
"SAFE HARBOR" STATEMENT UNDER THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995
Statements included herein that are not historical facts are forward-lookingstatements. Such forward-looking statements involve a number of risks anduncertainties and are subject to change at any time. In the event such risks oruncertainties materialize, Shire's results could be materially affected. Therisks and uncertainties include, but are not limited to: risks associated withthe inherent uncertainty of pharmaceutical research, product development,manufacturing and commercialization; the impact of competitive products,including, but not limited to the impact of those on Shire's ADHD franchise;patents, including but not limited to, legal challenges relating to Shire'sADHD franchise; government regulation and approval, including but not limitedto the expected product approval dates of SPD503 (guanfacine extended release)(ADHD), SPD465 (extended release of mixed amphetamine salts) (ADHD), andVYVANSE (NRP104) (lisdexamfetamine dimesylate) (ADHD), including its schedulingclassification by the Drug Enforcement Administration in the United States;Shire's ability to complete, and achieve anticipated benefits from theacquisition of New River Pharmaceuticals; Shire's ability to secure newproducts for commercialization and/or development; and other risks anduncertainties detailed from time to time in Shire's filings with the Securitiesand Exchange Commission.Statements regarding future earnings or earnings per share or the growth ofeither of these should not be interpreted to mean that earnings or earnings pershare will necessarily be greater in any financial period than for the relevantpreceding financial period.Goldman Sachs, Morgan Stanley and Deutsche Bank, are acting exclusively forShire and no one else in relation to the matters described in this announcementand will not be responsible to anyone other than Shire for providing theprotections afforded to customers of Goldman Sachs, Morgan Stanley or DeutscheBank or for providing advice in relation to the matters referred to in this
announcement.AppendixAPPENDIX
Important information on the Placing
NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, DIRECTLY OR INDIRECTLY, IN OR INTO THE UNITED STATES, CANADA, AUSTRALIA OR JAPAN OR TO US PERSONS (AS DEFINED IN THE US SECURITIES ACT OF 1933)
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 TOINVESTMENTS AND ARE (1) QUALIFIED INVESTORS AS DEFINED IN SECTION 86(7) OF THEFINANCIAL SERVICES AND MARKETS ACT 2000 ("FSMA"), BEING PERSONS FALLING WITHINTHE MEANING OF ARTICLE 2.1(e)(i), (ii) OR (iii) OF DIRECTIVE 2003/71/EC (THE"PROSPECTUS DIRECTIVE") AND (2) IN THE UNITED KINGDOM FALL WITHIN ARTICLE 19(5)OF THE FINANCIAL SERVICES AND MARKETS ACT 2000 (FINANCIAL PROMOTION) ORDER2005, AS AMENDED (THE "ORDER") OR ARE PERSONS WHO FALL WITHIN ARTICLE 49(2)(a)TO (d) ("HIGH NET WORTH COMPANIES, UNINCORPORATED ASSOCIATIONS, ETC") OF THEORDER (ALL SUCH PERSONS TOGETHER BEING REFERRED TO AS "RELEVANT PERSONS"). THISAPPENDIX AND THE TERMS AND CONDITIONS SET OUT HEREIN MUST NOT BE ACTED ON ORRELIED ON BY PERSONS WHO ARE NOT RELEVANT PERSONS. ANY INVESTMENT OR INVESTMENTACTIVITY TO WHICH THIS APPENDIX AND THE TERMS AND CONDITIONS SET OUT HEREINRELATES IS AVAILABLE ONLY TO RELEVANT PERSONS AND WILL BE ENGAGED IN ONLY WITHRELEVANT PERSONS. THIS APPENDIX DOES NOT ITSELF CONSTITUTE AN OFFER FOR SALE ORSUBSCRIPTION OF ANY SECURITIES IN SHIRE PLC.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 conditions contained 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 has implemented the Prospectus Directive (each a "Relevant Member State") who acquires 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 financialintermediary, as that term is used in Article 3(2) of the Prospectus Directive,(i) the Placing Shares acquired by it in the Placing have not been acquired onbehalf 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 incircumstances in which the prior consent of Morgan Stanley & Co. InternationalLimited, Goldman Sachs International and Deutsche Bank AG, London Branch(together, the "Banks") has been given to the offer or resale; or (ii) wherePlacing Shares have been acquired by it on behalf of persons in any memberstate of the EEA other than Qualified Investors, the offer of those PlacingShares to it is not treated under the Prospectus Directive as having been madeto such persons; and3. is acquiring the Placing Shares for its own account or is acquiring thePlacing Shares for an account with respect to which it exercises soleinvestment discretion, and that it (and any such account) is outside the UnitedStates, is not, and is not held by, a US person; or if it is not outside theUnited States, it is a qualified institutional buyer ("QIB") as defined in Rule144A under the US Securities Act of 1933 (the "Securities Act").This announcement (including this Appendix) does not constitute an offer tosell or issue or the solicitation of an offer to buy or subscribe for PlacingShares in any jurisdiction including, without limitation, the United Kingdom,the United States, Canada, Australia or Japan. This announcement and theinformation contained herein is not for publication or distribution, directlyor indirectly, to US persons or to persons in the United States, Canada,Australia, Japan or in any jurisdiction in which such publication ordistribution 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 or to, or for theaccount or benefit of, US persons except pursuant to an exemption from, or in atransaction not subject to, the registration requirements of the SecuritiesAct. Any offering to be made in the United States will be made to a limitednumber of QIBs pursuant to an exemption from registration under the SecuritiesAct or in a transaction not involving any public offering. The Placing Sharesare being offered and sold outside the United States to persons who are not USpersons in accordance with Regulation S under the Securities Act.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, the Banks, or any of their respective Affiliates,that would permit an offer of the Placing Shares or possession or distributionof this announcement or any other offering or publicity material relating tosuch Placing Shares in any jurisdiction where action for that purpose isrequired. Persons into whose possession this announcement comes are required bythe Company and the Banks to inform themselves about and to observe any suchrestrictions.
In this Appendix, unless the context otherwise requires, the "Company" means Shire plc and "Placee" includes a person (including individuals, funds or others) 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 and anyinformation publicly announced to a Regulatory Information Service by or onbehalf of the Company on or prior to the date of this announcement (the"Publicly Available Information"). In relation to such Publicly AvailableInformation, Placees are advised that the preliminary results announcement madeby the Company on the date of this announcement contains details of arestatement of the Company's 2005 US GAAP results. In addition, Placees shouldnot rely on the Company's US GAAP financial statements contained in its AnnualReport on Form 10-K for the year ended December 31, 2005 and its QuarterlyReports on Form 10-Q for the periods ended March 31, June 30, and September 30,2006. Each Placee, by participating in the Placing, agrees that it has neitherreceived nor relied on any information, representation, warranty or statementmade by or on behalf of any of the Banks or the Company other than the PubliclyAvailable Information and none of the Banks, the Company nor any person actingon such person's behalf nor any of their Affiliates has or shall have anyliability for any Placee's decision to accept this invitation to participate inthe Placing based on any other information, representation, warranty orstatement. Each Placee acknowledges and agrees that it has relied on its owninvestigation of the business, financial or other position of the Company inaccepting a participation in the Placing. Nothing in this paragraph shallexclude the liability of any person for fraudulent misrepresentation.
Details of the Placing Agreement and the Placing Shares
The Banks have entered into a placing agreement (the "Placing Agreement") withthe Company under which the Banks have undertaken, on the terms and subject tothe conditions set out in the Placing Agreement, acting severally, and notjointly or jointly and severally, to arrange and underwrite the Placing.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 5 penceper share in the capital of the Company, including the right to receive alldividends and other distributions declared, made or paid in respect of suchordinary 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 the LondonStock Exchange for admission to trading of the Placing Shares on the LondonStock Exchange's market for listed securities (together "Admission"). It isexpected that Admission will take place on or before 26 February 2007 and thatdealings in the Placing Shares on the London Stock Exchange's main market forlisted securities will commence at the same time.
Bookbuilding
The Banks will today commence the Bookbuilding to determine demand for participation in the Placing by Placees. This Appendix gives details of the terms and conditions of, and the mechanics of participation in, the Placing. No commissions will be paid to Placees or by Placees in respect of any Placing Shares.
The Banks and the Company shall be entitled to effect the Placing by such alternative method to the Bookbuilding as they may, in their sole discretion, determine.
Principal terms of the Bookbuilding and Placing
1. Participation in the Placing will only be available to persons who may lawfully be, and are, invited to participate by the Banks. Each of the Banks is entitled to enter bids in the Bookbuilding.
2. The Bookbuilding will establish a single price (the Placing Price) payableto the Banks by all Placees whose bids are successful. The Placing Price andthe aggregate proceeds to be raised through the Placing will be agreed betweenthe Banks and the Company following completion of the Bookbuilding and anydiscount to the market price of the ordinary shares of the Company will bedetermined in accordance with the Listing Rules and IPC guidelines. The PlacingPrice will be announced (the "Pricing Announcement") on a RegulatoryInformation Service following the completion of the Bookbuilding.3. To bid in the Bookbuilding, Placees should communicate their bid bytelephone to their usual sales contact at Morgan Stanley & Co. InternationalLimited, Goldman Sachs International or Deutsche Bank AG, London Branch. Eachbid should state the number of shares in the Company which a prospective Placeewishes to acquire at either the Placing Price which is ultimately establishedby the Company and the Banks or at prices up to a price limit specified in itsbid. Bids may be scaled down by the Banks on the basis referred to in paragraph7 below. Each of Morgan Stanley & Co. International Limited, Goldman SachsInternational and Deutsche Bank AG, London Branch is arranging the Placingseverally, and not jointly, or jointly and severally, as agent of the Company.4. The Bookbuilding is expected to close no later than 9.00 p.m. (GMT) on 20February 2007 but may be closed earlier or later at the discretion of theBanks. The Banks may, in agreement with the Company, accept bids that arereceived after the Bookbuilding has closed. The Company reserves the right toreduce or seek to increase the amount to be raised pursuant to the Placing, inits discretion.5. Allocations will be confirmed orally by the relevant Bank as soon aspracticable following the close of the Bookbuilding. The relevant Bank's oralconfirmation of an allocation will give rise to a legally binding commitment bythe Placee concerned, in favour of the relevant Bank and the Company, underwhich it agrees to acquire the number of Placing Shares allocated to it on theterms and subject to the conditions set out in this Appendix and the Company'sMemorandum and Articles of Association.
6. The Company will make a further announcement following the close of the Bookbuilding detailing the number of such shares to be issued and the price at which such shares have been placed.
7. Subject to paragraphs 4 and 6 above, the Banks may choose to accept bids,either in whole or in part, on the basis of allocations determined at itsdiscretion (in agreement with the Company) and may scale down any bids for thispurpose on such basis as they may determine. They may also, notwithstandingparagraphs 4 to 6 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.8. 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 the relevant Bank's consent will not becapable of variation or revocation after the time at which it is submitted.Each Placee will have an immediate, separate, irrevocable and bindingobligation, owed to the relevant Bank, to pay to it (or as it may direct) incleared funds an amount equal to the product of the Placing Price and thenumber of Placing Shares such Placee has agreed to acquire. Each Placee'sobligations will be owed to the Company and to the relevant Bank.
9. Except as required by law or regulation, no press release or other announcement will be made by the Banks or the Company using the name of any Placee (or its agent), in its capacity as Placee (or agent), other than with such Placee's prior written consent.
10. 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".
11. All obligations under the Bookbuilding and Placing will be subject to fulfilment 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".
12. By participating in the Bookbuilding each Placee will agree that its rights and obligations in respect of the Placing will terminate only in the circumstances described below and will not be capable of rescission or termination by the Placee.
13. To the fullest extent permissible by law, none of the Banks nor any oftheir Affiliates shall have any liability to Placees (or to any other personwhether acting on behalf of a Placee or otherwise). In particular, none of theBanks nor any of their Affiliates shall have any liability (including, to theextent permissible by law, any fiduciary duties) in respect of the Banks'conduct of the Bookbuilding or of such alternative method of effecting thePlacing as the Banks 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 the relevant Bank. Each Placee will be deemed to agree that itwill do all things necessary to ensure that delivery and payment is completedin accordance with either the standing CREST or certificated settlementinstructions which they have in place with the relevant Bank.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 the Banks and is expected to occur on or before 26February 2007. 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 andthe Banks may agree that the Placing Shares should be issued in certificatedform. The Banks reserve the right to require settlement for the Placing Shares,and to deliver the Placing Shares to Placees, by such other means as they deemnecessary if delivery or settlement to Placees is not practicable within theCREST 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 the relevant Bank may selltheir Placing Shares on their behalf and retain from the proceeds, for its ownaccount and benefit, an amount equal to the Placing Price of each share soldplus any interest due. Placees will, however, remain liable for any shortfallbelow the Placing Price and for any stamp duty or stamp duty reserve tax(together with any interest or penalties) which may arise upon the sale oftheir Placing Shares on 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 copied and delivered immediately to the relevant person within that organisation.
Conditions of the Placing
The Placing is conditional upon the Placing Agreement becoming unconditional and not having been terminated in accordance with its terms.
The obligations of the Banks under the Placing Agreement are, and the Placing is, conditional on, inter alia:
(a) Admission occurring no later than 8 a.m. (London time) on 26 February 2007(or such later time and/or date as may be agreed between the Company and theBanks, not being later than 1 March 2007);(b) (save to the extent not materially adverse in the Placing) the warrantiesgiven by the Company in the Placing Agreement being true and accurate and notmisleading in any respect on and as of the date of the Placing Agreement and atany time prior to Admission; and
(c) the fulfilment by the Company of its obligations under the Placing Agreement which are required to be performed or satisfied on or prior to Admission, save to the extent that any non-compliance is not material in the context of the Placing.
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 the Banks may agree), or the PlacingAgreement is terminated in accordance with its terms, the Placing will lapseand the Placee's rights and obligations shall cease and terminate at such timeand each Placee agrees that no claim can be made by or on behalf of the Placee(or any person on whose behalf the Placee is acting) in respect thereof.By participating in the Bookbuilding Process, each Placee agrees that itsrights and obligations cease and terminate only in the circumstances describedabove and under "Termination of the Placing" below and will not be capable ofrescission or termination by it.The Banks may, at their joint agreement and discretion and upon such terms asthey jointly think fit, waive compliance by the Company, or extend the time and/or date for fulfilment by the Company, with the whole or any part of any ofthe Company's obligations in relation to the conditions in the PlacingAgreement, save that certain conditions including the condition relating toAdmission referred to in paragraph (a) above may not be waived. Any suchextension or waiver will not affect Placees' commitments as set out in thisAppendix .None of the Banks nor any of their Affiliates nor 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
The Banks may, at their absolute discretion (acting in good faith), by jointnotice in writing to the Company, terminate the Placing Agreement at any timeprior to Admission if, inter alia:(a) they become aware that the Company is in breach of any of its obligationsunder the Placing Agreement save to the extent that any breach is not, in theopinion of the Banks (acting in good faith), material in the context of thePlacing; or(b) they become aware that any of the warranties given by the Company in thePlacing Agreement is, or if repeated at any time up to and including Admission(by reference to the facts and circumstances then existing) would be, untrue,inaccurate, incorrect or misleading, save to the extent not materially adversein the context of the Placing; or(c) there has been a material adverse change, or development reasonably likelyto involve a material adverse change, in the condition (financial, operational,legal or otherwise) or in the earnings, business affairs, solvency or prospectsof the Company or the Group, whether or not arising in the ordinary course ofbusiness, since the date of the Placing Agreement; or
(d) there has been or, in the opinion of the Banks, it is reasonably likely that there will occur:
(i) any material adverse change in the international financial, political, economic or stock market conditions,
(ii) any outbreak or escalation of hostilities, war, act of terrorism or declaration of emergency or martial law or other calamity or crisis; or
(iii) trading in any securities of the Company has been suspended or limited bythe London Stock Exchange on any exchange or over-the-counter market, or iftrading generally on the NASDAQ National Market, the New York Stock Exchange,the London Stock Exchange, the Toronto Stock Exchange has been suspended orlimited; or
(iv) a material disruption has occurred in commercial banking or securities settlement or clearance services in the United States, Canada or in Europe; or
(v) the application of the Company for Admission is withdrawn or refused by the FSA or the London Stock Exchange; or
(vi) a banking moratorium has been declared by the United States, Canada, the United Kingdom or New York Authorities,
in each case the effect of which (either singly or together with any of theevents in (i) to (vi) above) is such as would in the opinion of the Banks(acting in good faith) make it impracticable or inadvisable to market thePlacing Shares or to enforce contracts for sale of the Placing Shares or wouldbe likely to prejudice the success of the Placing or dealings in the PlacingShares in the secondary market.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 theBanks that the exercise by the Company or the Banks of any right of terminationor any other right or other discretion under the Placing Agreement shall bewithin the absolute discretion of the Company or the Banks (as the case may be)and that neither the Company nor the Banks need make any reference to suchPlacee and that neither the Company, the Banks nor any of their respectiveAffiliates shall have any liability to such Placee (or to any other personwhether acting on behalf of a Placee or otherwise) whatsoever in connectionwith 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 the Banksfollowing the close of the Bookbuilding.
Representations and further terms
By submitting a bid in the Bookbuilding, each prospective Placee (and any person acting on such Placee's behalf) represents, warrants, acknowledges and agrees 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, agreementsand undertakings 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. if the Placing Shares were offered to it in the United States, it representsand warrants that in making its investment decision, (i) it has consulted itsown independent advisers or otherwise has satisfied itself concerning, withoutlimitation, the effects of United States federal, state and local income taxlaws and foreign tax laws generally and the US Employee Retirement IncomeSecurity Act of 1974, the US Investment Company Act of 1940 and the SecuritiesAct, (ii) it has had access to such financial and other information (includingthe business, financial condition, prospects, creditworthiness, status andaffairs of the Company, the Placing and the Placing Shares, as well as theopportunity to ask questions) concerning the Company, the Placing and thePlacing Shares that it believes is necessary or appropriate in order to make aninvestment decision in respect of the Company and the Placing Shares and (iii)it is aware and understands that an investment in the Placing Shares involves aconsiderable degree of risk and no US federal or state or non-US agency hasmade any finding or determination as to the fairness for investment or anyrecommendation or endorsement of the Placing Shares;4. (i) it has made its own assessment of the Company, the Placing Shares andthe terms of the Placing based on Publicly Available Information, (ii) none ofthe Banks, their respective Affiliates or the Company has made anyrepresentation to it, express or implied, with respect to the Company, thePlacing or the Placing Shares or the accuracy, completeness or adequacy of thePublicly Available Information and (iii) it has conducted its own investigationof the Company, the Placing and the Placing Shares, satisfied itself that theinformation is still current and relied on that investigation for the purposesof its decision to participate in the Placing;5. the content of this announcement is exclusively the responsibility of theCompany and that none of the Banks nor any person acting on their 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, warrantyor statement contained in this announcement, the Publicly Available Informationor otherwise. Nothing in this Appendix shall exclude any liability of anyperson for fraudulent misrepresentation;6. 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, (i) not in the United States and not a US person acquiring the PlacingShares in an 'offshore transaction' in accordance with Rule 903 or Rule 904 ofRegulation S under the Securities Act or (ii) a QIB acquiring the PlacingShares in accordance with an exemption from registration under the SecuritiesAct who has returned an "investor letter" substantially in the form provided,and has such knowledge and experience in financial and business matters as tobe capable of evaluating the merits and risks of an investment in the PlacingShares, will not look to the banks for all or part of any such loss it maysuffer, is able to bear the economic risk of an investment in the PlacingShares, is able to sustain a complete loss of the investment in the PlacingShares and has no need for liquidity with respect to its investment in thePlacing Shares and represents and, in the case of (ii) above, warrants that itis acquiring the Placing Shares for its own account or for one or more accountsas to each of which it exercises sole investment discretion and each of whichis a QIB, for investment purposes and not with a view to any distribution orfor resale in connection with, the distribution thereof in whole or in part, inthe United States;7. the Placing Shares have not been registered or otherwise qualified for offerand sale nor will a prospectus be cleared in respect of any of the PlacingShares under the securities laws of the United States, Australia, Canada orJapan and, subject to certain exceptions, may not be offered, sold, taken up,renounced or delivered or transferred, directly or indirectly, within theUnited States, Australia, Canada or Japan, or to, or for the account or benefitof, US persons;
8. it and/or each person on whose behalf it is participating:
(i) is entitled to acquire Placing Shares pursuant to the Placing under the laws of 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 andto perform its obligations in relation thereto;9. 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 to persons that are not USpersons in offshore transactions (each as defined in Regulation S under theSecurities Act) and to QIBs in accordance with an exemption from, ortransaction not subject to, the registration requirements under the SecuritiesAct;
10. the Placing Shares offered and sold in the United States are "restricted securities" within the meaning of Rule 144(a)(3) under the Securities Act;
11. so long as the Placing Shares are "restricted securities" within the meaning of Rule 144(a)(3) under the Securities Act, it will not deposit the Placing Shares into any unrestricted depositary receipt facility maintained by any depositary bank in respect of the Company's Ordinary Shares and it understands that the Placing Shares will not settle or trade through the facilities of DTC, the NYSE, NASDAQ or any other US exchange or clearing system;
12. 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 under the Securities Act provided that a) as part of thedistribution at any time, and b) otherwise until the end of the distributioncompliance period no such offer or sale will be made to, or for the account orbenefit of US persons; (ii) pursuant to an exemption from, or a transaction notsubject to, registration under the Securities Act (if available), (iii)pursuant to an effective registration statement under the Securities Act andthat, in each such case, such offer, sale, pledge, or transfer will be made inaccordance with any applicable securities laws of any state of the UnitedStates;13. if it is acquiring Placing Shares for the account of one or more QIBs, ithas full power to make the acknowledgements, representations, warranties andagreements herein on behalf of each such account;
14. if it is a pension fund or investment company, its acquisition of Placing Shares is in full compliance with applicable laws and regulations;
15. no representation has been made as to the availability of any other exemption under the Securities Act for the reoffer, resale, pledge or transfer of the Placing Shares;
16. participation in the Placing is on the basis that it is not and will not bea client of any of the Banks and that the Banks have no duties orresponsibilities to a Placee for providing protections afforded to theirrespective clients or for providing advice in relation to the Placing nor inrespect of any representations, warranties, undertakings or indemnitiescontained in the Placing Agreement;
17. it will make payment to the Banks in accordance with the terms and conditions of this announcement on the due times and dates set out in this announcement, failing which the relevant Placing Shares may be placed with others on such terms as the Banks determine;
18. the person who it specifies for registration as holder of the PlacingShares will be (i) the Placee or (ii) a nominee of the Placee, as the case maybe. The Banks and the Company will not be responsible for any liability tostamp duty 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 oneof the Banks who will hold them as nominee on behalf of the Placee untilsettlement in accordance with its standing settlement instructions with it;19. the allocation, allotment, issue and delivery to it, or the personspecified by it for registration as holder, of Placing Shares will not giverise to a stamp duty or stamp duty reserve tax liability under (or at a ratedetermined under) any of sections 67, 70, 93 or 96 of the Finance Act 1986(depository receipts and clearance services) and that it is not participatingin the Placing as nominee or agent for any person or persons to whom theallocation, allotment, issue or delivery of Placing Shares would give rise tosuch a liability;20. 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;21. 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 disposingof investments (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) of the Financial Services and Markets Act 2000 (the "FSMA");
22. it is a qualified investor as defined in section 86(7) of FSMA, being a person falling within Article 2.1(e)(i), (ii) or (iii) of the Prospectus Directive;
23. 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;24. 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;25. 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 personswhose ordinary activities involve them acquiring, holding, managing ordisposing of investments (as principal or agent) for the purpose of theirbusiness or otherwise in circumstances which have not resulted and which willnot result in an offer to the public in any member state of the EuropeanEconomic Area within the meaning of the Prospectus Directive (which meansDirective 2003/71/EC and includes any relevant implementing measure in anymember state);26. it has complied with its obligations in connection with money launderingand terrorist financing under the Proceeds of Crime Act 2002, the Terrorism Act2000, and the Money Laundering Regulations (2003) (the "Regulations") and, ifmaking payment on behalf of a third party, that satisfactory evidence has beenobtained and recorded by it to verify the identity of the third party asrequired by the Regulations;
27. the Company, the Banks and others will rely upon the truth and accuracy of the foregoing representations, warranties, acknowledgements and agreements;
28. the Placing Shares will be issued subject to the terms and conditions of this Appendix; and
29. this Appendix and all documents into which this Appendix is incorporated byreference or otherwise validly forms a part will be governed by and construedin accordance with English law. All agreements to acquire shares pursuant tothe Bookbuilding and/or the Placing will be governed by English law and theEnglish courts shall have exclusive jurisdiction in relation thereto exceptthat proceedings may be taken by the Company or the Banks in any jurisdictionin which the relevant Placee is incorporated or in which any of its securitieshave a quotation 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 the Banksharmless 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 toPlacees (or the persons for whom Placees are contracting as agent) free ofstamp duty and stamp duty reserve tax in the UK relates only to their allotmentand issue to Placees, or such persons as they nominate as their agents, directfrom the Company for the Placing Shares in question. Such agreement assumesthat the Placing Shares are not being acquired in connection with arrangementsto issue depositary receipts or to transfer the Placing Shares into a clearanceservice. If there were any such arrangements, or the settlement related toother dealings in the Placing Shares, stamp duty or stamp duty reserve tax maybe payable, for which neither the Company nor the Banks would be responsible.If this is the case, it would be sensible for Placees to take their own adviceand they should notify the relevant Bank accordingly. In addition, Placeesshould note that they will be liable for any capital duty, stamp duty and allother stamp, issue, securities, transfer, registration, documentary or otherduties or taxes (including any interest, fines or penalties relating thereto)payable outside the UK by them or any other person on the acquisition by themof any Placing Shares or the agreement by them to acquire any Placing Shares.The representations, warranties, acknowledgements and undertakings contained inthis Appendix are given to the Banks for itself and on behalf of the Companyand are irrevocable.The Banks are acting exclusively for the Company and no one else in connectionwith the Bookbuilding and the Placing and the Banks will not be responsible toanyone (including Placees) other than the Company for providing the protectionsafforded to their respective clients or for providing advice in relation to theBookbuilding or the Placing or any other matters referred to in this pressannouncement.
Each Placee and any person acting on behalf of the Placee acknowledges that none of the Banks owes fiduciary or other duties to any Placee in respect of any representations, warranties, undertakings or indemnities in the Placing Agreement.
Each Placee and any person acting on behalf of the Placee acknowledges and agrees that each of the Banks may (at its absolute discretion) satisfy its obligations to procure Placees by itself agreeing to become a Placee in respect of some or all of the Placing Shares or by nominating any connected or associated person to do so.
When a Placee or any person acting on behalf of the Placee is dealing with anyof the Banks, any money held in an account with any Bank on behalf of thePlacee and/or any person acting on behalf of the Placee will not be treated asclient money within the meaning of the relevant rules and regulations of theFinancial Services Authority which therefore will not require the Banks tosegregate such money, as that money will be held by it under a bankingrelationship and not as trustee.
Past performance is no guide to future performance and persons needing advice should consult an independent financial adviser.
All times and dates in this announcement may be subject to amendment. The relevant Bank will notify Placees and any persons acting on behalf of the Placees of any changes.
DEFINITIONS
In this announcement, unless the context otherwise requires:
"Affiliate" means in respect of a person, any holding company or subsidiary undertaking of such person or any subsidiary undertaking of any such holding company, or any of their respective associated undertakings;
"Banks" means Morgan Stanley, Goldman Sachsl and Deutsche Bank;
"Bookbuilding" means the process to be carried out by the Banks to establish demand at different prices from potential Placees for the Placing Shares;
"Deutsche Bank" means Deutsche Bank AG, London Branch;
"Goldman Sachs" means Goldman Sachs International;
"Group" means the Company and its subsidiary undertakings;
"Listing Rules" means the listing rules produced by the FSA under Part VI of the FSMA and forming part of the FSA's Handbook of rules and guidance, as amended from time to time;
"London Stock Exchange" means London Stock Exchange plc;
"Morgan Stanley" means Morgan Stanley & Co. International Limited;
"New River" means means New River Pharmaceuticals, Inc.;
"Ordinary Shares" means ordinary shares of 5p each in the capital of the Company;
"Placees" means persons (including individuals, funds or others) on whose behalf a commitment to acquire Placing Shares has been given and Placee means any one of them;
"Placing Price" means the price per Ordinary Share at which the Placing Shares are to be placed with Placees;
"QIB" means qualified institutional buyer within the meaning of Rule 144A of the Securities Act;
"Regulation S" means Regulation S promulgated under the Securities Act;
"Regulatory Information Service" means any of the regulatory information services included within the list maintained on the London Stock Exchange's website;
"Securities Act" means the United States Securities Act of 1933;
"Shire" means Shire plc a public limited company incorporated under the laws of England and Wales;
"United Kingdom" or "UK" means the United Kingdom of Great Britain and Northern Ireland;
"US GAAP" means generally accepted accounting principles in the United States;
"United States" means the United States of America, its territories and possessions, any State of the United States and the District of Columbia; and
"US person" is used as defined in Regulation S under the Securities Act.
References to "$" are to the lawful currency of the United States.
Hampshire International Business Park Chineham Basingstoke Hampshire RG24 8EP United Kingdom Tel +44 (0)1256 894000 Fax +44 (0)1256 894708 www.shire.com Press Release
Registered in England 5492592Registered Office as above
SHIRE PLCRelated Shares:
Shire