Akzo Nobel NV
13 August 2007
NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION (IN WHOLE OR IN PART) IN, INTO OR
FROM AUSTRALIA, CANADA OR JAPAN OR ANY OTHER JURISDICTION WHERE TO DO SO WOULD
CONSTITUTE A VIOLATION OF THE RELEVANT LAWS OF SUCH JURISDICTION
13 August 2007
RECOMMENDED CASH OFFER
FOR
IMPERIAL CHEMICAL INDUSTRIES PLC
BY
AKZO NOBEL N.V.
Summary
• The Board of Management and Supervisory Board of Akzo Nobel N.V. and
the Board of Imperial Chemical Industries PLC are pleased to announce that they
have reached agreement on the terms of a recommended cash offer by Akzo Nobel
for the entire issued and to be issued share capital of ICI, including the ICI
Shares underlying the ICI ADSs.
• Under the terms of the Transaction, ICI Shareholders will receive 670
pence in cash for every ICI Share.
• Before the Effective Date, ICI will declare a second ordinary interim
dividend in relation to the period from 1 July 2007 to 31 December 2007 of 5
pence per ICI Share, provided that, if the Effective Date falls prior to 31
December 2007, such dividend shall be paid pro rata by reference to where the
Effective Date falls between 1 July 2007 and 31 December 2007. For the
avoidance of doubt, ICI Shareholders registered as such on the relevant record
date will retain their entitlement to receive the first ordinary interim
dividend of 4.95 pence per ICI Share declared on 2 August 2007.
• The offer price of 670 pence for each ICI Share values the entire
existing issued ordinary share capital of ICI at approximately £8.0 billion, and
represents a premium of approximately:
• 22 per cent. to the Closing Price of 549 pence per ICI Share on 15
June 2007 (being the last Business Day prior to the announcement by ICI that it
had received an approach from Akzo Nobel);
• 35 per cent. to the average Closing Price of approximately 498 pence
per ICI Share for the six months ended 15 June 2007 (being the last Business Day
prior to the announcement by ICI that it had received an approach from Akzo
Nobel); and
• 44 per cent. to the Closing Price of 464 pence per ICI Share on 9
March 2007 (being the last Business Day prior to Akzo Nobel's announcement in
relation to the disposal of Organon BioSciences).
• ICI Shareholders (other than Restricted Overseas Persons) will have
the option of taking Loan Notes instead of cash.
• In connection with the acquisition of ICI, Akzo Nobel has entered into
an agreement with Henkel to sell all assets and liabilities comprising the
business divisions known within the ICI Group as the 'Adhesives Division' and
the 'Electronic Materials Division', both of which form part of the 'National
Starch' business of ICI, for £2.7 billion (€4.0 billion) in cash (calculated on
a debt and cash free basis and subject to certain adjustments). The transaction
with Henkel is not a condition to completion of Akzo Nobel's acquisition of ICI
and will be implemented following the Effective Date.
• Akzo Nobel believes that the Transaction, in combination with the
On-Sale, has a clear and compelling strategic and financial rationale for Akzo
Nobel, with significant benefits for its shareholders and other stakeholders:
• the Transaction provides the opportunity to create a global
leader in coatings and one of the largest specialty chemicals companies in the
world with complementary brands, assets and skills, and leading positions in
attractive specialty chemicals markets;
• the enlarged Akzo Nobel group will benefit from a diversified
and broad geographic presence, a significantly strengthened decorative coatings
business and highly attractive platforms for growth in emerging markets;
• Akzo Nobel estimates full run-rate annual pre-tax operating cost
savings in relation to the ICI paints business of €280 million (£189 million).
In addition, Akzo Nobel expects to achieve synergies from increased sales across
the combined portfolio; and
• the proposed acquisition of ICI in combination with the On-Sale
is expected to be: (i) as a whole, enhancing to earnings (see notes 1 and 2
below); (ii) generative of an internal rate of return meaningfully above Akzo
Nobel's weighted average cost of capital (defined as 8 per cent.); and (iii) EVA
positive in year three following the Transaction (see notes 1 and 2 below).
• Akzo Nobel views the appropriate capital structure for a specialty
chemicals business to be one that supports a solid investment grade rating.
Consistent with this objective, in addition to its existing share buyback
programme of approximately €1.6 billion (£1.1 billion), Akzo Nobel is
considering an additional return of capital to its shareholders of up to €3
billion (£2 billion) commencing in 2008, subject to shareholder approval,
completion of the sale of Organon BioSciences and completion of the On-Sale. It
is Akzo Nobel's intention to structure the additional return of capital in a tax
efficient manner for its shareholders generally.
• It is intended that the Transaction will be implemented by way of a
court-sanctioned scheme of arrangement under section 425 of the Companies Act
1985. It is expected that the Scheme Document will be posted to ICI
Shareholders on or around 24 September 2007.
• The Scheme will be put to Scheme Shareholders at the Court Meeting and
to ICI Shareholders at the ICI EGM. The Transaction is subject to the approval
of Akzo Nobel's shareholders and will be put to Akzo Nobel shareholders at the
Akzo Nobel EGM. Subject to the satisfaction of the Conditions, it is expected
that the Scheme will become effective during late November or early December
2007.
• The directors of ICI, who have been so advised by Merrill Lynch and
UBS, consider the terms of the Transaction to be fair and reasonable. In
providing their advice, Merrill Lynch and UBS have taken into account the
commercial assessments of the directors of ICI. In addition, the directors of
ICI consider the terms of the Transaction to be in the best interests of the ICI
Shareholders as a whole.
• Accordingly, the directors of ICI intend unanimously to recommend that
ICI Shareholders vote in favour of the Scheme and the resolutions to be proposed
at the Court Meeting and the ICI EGM (or, if the Transaction is implemented by
way of a takeover offer, that they accept or procure acceptance of such offer)
as they have irrevocably undertaken to do in respect of their own beneficial
shareholdings of 654,111 ICI Shares, representing (as at the date of this
announcement) approximately 0.055 per cent. of the existing issued share capital
of ICI.
• Commenting on today's announcement, Hans Wijers, CEO of Akzo Nobel,
said:
'I am delighted by this transaction which will be a transformational step in
implementing our strategy. We will create a leading global coatings and
specialty chemicals company with a diversified geographic presence and well
developed access to fast-growing markets in Asia-Pacific, particularly China and
Latin America. Through this combination, we will be able to realise significant
synergies and create value for our shareholders. At the same time, our
customers, employees, pension funds and other stakeholders will benefit from the
size and reach of the enlarged group. The pre-agreed on-sale of ICI's Adhesives
and Electronic Materials businesses to Henkel is entirely consistent with our
promise of financial discipline and provides the added benefit of being able to
return additional cash to our shareholders in the near future.'
• Commenting on the Transaction, John McAdam, CEO of ICI, said:
'The management and employees of ICI have done much to transform the performance
of ICI over the last few years, putting in place a clear strategy and strong
focus on operational excellence. ICI has leading market positions across its
businesses and competitive strengths in emerging economies in Asia and Latin
America, together with technically advanced products aligned to strong growth
trends. However, Akzo Nobel has today made a compelling offer which delivers
full value for ICI reflecting ICI's strong future growth prospects and strategic
opportunities. Accordingly, the ICI Board will be recommending shareholders
accept the 670 pence cash offer from Akzo Nobel as it believes it to be in their
best interests.'
Morgan Stanley is acting as financial adviser to Akzo Nobel. Merrill Lynch and
UBS are acting as joint financial advisers and joint corporate brokers to ICI.
Akzo Nobel is hosting an analyst presentation at 9.00 a.m. (London time) at the
Great Eastern Hotel, 40 Liverpool Street, London, EC2M 7QN. The analyst
presentation will be webcast live and can be accessed via Akzo Nobel's corporate
website at www.akzonobel.com. To participate in the live question and answer
session to be held after the presentation, analysts should dial +44 20 7190
1590. The webcast of the analyst presentation will also be available via Akzo
Nobel's corporate website at www.akzonobel.com after the presentation has
concluded.
Akzo Nobel is hosting a press presentation at 12.00 p.m. (London time) at the
Great Eastern Hotel, 40 Liverpool Street, London, EC2M 7QN. The press
presentation will be webcast live and can be accessed via Akzo Nobel's corporate
website at www.akzonobel.com. The webcast of the press presentation will also
be available via Akzo Nobel's corporate website at www.akzonobel.com after the
presentation has concluded.
This summary should be read in conjunction with, and is subject to, the full
text of the following announcement and the Appendices. Appendix I sets out the
Conditions and certain further terms of the Transaction. Appendix II contains
information on bases and sources used in this announcement, Appendix III
provides information in relation to certain irrevocable undertakings and
Appendix IV contains definitions of certain terms used in this announcement.
Notes:
1. Before purchase accounting for the Transaction.
2. This statement is not a profit forecast and should not be
interpreted to mean that future earnings per share will necessarily be greater
than those for the relevant preceding financial period.
Enquiries:
AKZO NOBEL
Dick Luijckx (Investor Relations) Tel: +31 26 366 4317
Tim van der Zanden (Financial Communications Officer Tel: +31 26 366 4343
(London))
Heleen van de Lustgraaf (Communications Manager (Holland)) Tel: +31 26 366 4343
MORGAN STANLEY & CO. LIMITED Tel: +44 207 425 8000
(Financial adviser to Akzo Nobel)
Simon Robey
Johannes Groeller
Jan Weber
SMITHFIELD
(PR adviser to Akzo Nobel)
John Kiely Tel: +44 207 360 4900
ICI
John Dawson (Vice President of Investor Relations & Corporate Tel: +44 207 009 5315
Communications)
Regina Kilfoyle (Director of Corporate Communications) Tel: +44 207 009 5410
MERRILL LYNCH Tel: +44 207 628 1000
(Financial adviser and corporate broker to ICI)
Matthew Greenburgh
Richard Taylor
Michael Findlay (Corporate Broking)
Ken McLaren
UBS INVESTMENT BANK Tel: +44 207 567 8000
(Financial adviser and corporate broker to ICI)
Robin Budenberg
Jonathan Bewes
Jackie Lee
James Archer
This announcement is not intended to and does not constitute or form any part of
an offer to sell, or an invitation to subscribe for or purchase, any securities
or the solicitation of any vote or approval in any jurisdiction pursuant to the
Transaction or otherwise. The Transaction will be made solely through the
Scheme Document, which will contain the full terms and conditions of the
Transaction (including details of how to vote in respect of the Transaction).
Any acceptance or other response to the Transaction should be made only on the
basis of the information in the Scheme Document. ICI Shareholders are advised
to read the formal documentation of the Transaction carefully once it has been
dispatched.
Morgan Stanley is acting exclusively for Akzo Nobel in connection with the
Transaction and no one else and will not be responsible to anyone other than
Akzo Nobel for providing the protections afforded to clients of Morgan Stanley
or for providing advice in relation to the Transaction or any other transaction,
arrangement or matter referred to in this announcement.
Merrill Lynch is acting exclusively for ICI in connection with the Transaction
and no one else and will not be responsible to anyone other than ICI for
providing the protections afforded to clients of Merrill Lynch or for providing
advice in relation to the Transaction or any other transaction, arrangement or
matter referred to in this announcement.
UBS is acting exclusively for ICI in connection with the Transaction and no one
else and will not be responsible to anyone other than ICI for providing the
protections afforded to clients of UBS or for providing advice in relation to
the Transaction or any other transaction, arrangement or matter referred to in
this announcement.
The availability of the Transaction to persons who are not resident in the UK,
the US or The Netherlands may be affected by the laws of the relevant
jurisdictions. Persons who are not so resident should inform themselves about,
and observe, any applicable requirements. Further details in relation to
overseas shareholders will be contained in the Scheme Document.
The release, publication or distribution of this announcement in jurisdictions
other than the UK, the US or The Netherlands may be restricted by law and
therefore any persons who are subject to the laws of any jurisdiction other than
the UK, the US or The Netherlands should inform themselves about, and observe,
any applicable requirements. Any failure to comply with the applicable
requirements may constitute a violation of the securities laws of any such
jurisdiction. This announcement has been prepared for the purpose of complying
with English law and the City Code and the information disclosed may not be the
same as that which would have been disclosed if this announcement had been
prepared in accordance with the laws of jurisdictions outside the UK.
Any person (including, without limitation, any custodian, nominee or trustee)
who would, or otherwise intends to, or who may have a contractual or legal
obligation to, forward this announcement, the Scheme Document and/or any other
related document to any jurisdiction outside the UK, the US and The Netherlands
should inform themselves of, and observe, any applicable legal or regulatory
requirements of their jurisdiction.
The Loan Notes that may be issued pursuant to the Transaction have not been and
will not be registered under the US Securities Act or under the relevant
securities laws of any state, district or territory or other jurisdiction of the
US. Accordingly, Loan Notes may not be offered or sold in the US or to any US
Person or any ICI ADS Holder.
Loan Notes which may be issued pursuant to the Transaction have not been, and
will not be, registered under the relevant securities laws of Japan and any
relevant clearances and registrations have not been, and will not be, obtained
from the securities commission of Canada. No securities registration statement
in relation to the Loan Notes has been, or will be, filed with the Kanto local
finance bureau of Japan or any other local finance bureau of the Japanese
Ministry of Finance. No prospectus in relation to the Loan Notes has been, or
will be, lodged or registered with the Australian Securities and Investments
Commission, the Japanese Ministry of Finance or the Companies Office in New
Zealand. Accordingly, unless otherwise determined by Akzo Nobel and permitted
by applicable law and regulation, Loan Notes may not be offered, sold, resold,
transferred, delivered or distributed, directly or indirectly, in or into or to
persons in Australia, Japan or The Netherlands, or any other jurisdiction where
to do so would violate the laws of that jurisdiction or would require
registration thereof in such jurisdiction.
US Persons should note that the Scheme relates to the shares of a UK company
that is a 'foreign private issuer' as defined under Rule 3b-4 under the US
Exchange Act and will be governed by English law. Neither the proxy
solicitation nor the tender offer rules under the US Exchange Act will apply to
the Scheme. Moreover, the Scheme will be subject to the disclosure requirements
and practices applicable in the UK to schemes of arrangement, which differ from
the disclosure requirements of the US proxy solicitation rules and tender offer
rules. Financial information included in this announcement and the Scheme
documentation has been or will have been prepared in accordance with accounting
standards applicable in the UK that may not be comparable to the accounting
standards applicable to financial statements of US companies. If Akzo Nobel
exercises its right to implement the acquisition of the ICI Shares (including in
the form of ICI ADSs) by way of a takeover offer, the offer will be made in
compliance with applicable US tender offer and securities laws and regulations.
This announcement, including information included or incorporated by reference
in this announcement, may contain 'forward-looking statements' concerning Akzo
Nobel and ICI. These statements are based on the current expectations of the
management of ICI and Akzo Nobel and are naturally subject to uncertainty and
changes in circumstances. Generally, the words 'will', 'may', 'should', '
continue', 'believes', 'expects', 'intends', 'anticipates' or similar
expressions identify forward-looking statements. The forward-looking statements
involve risks and uncertainties that could cause actual results to differ
materially from those expressed in the forward-looking statements. Many of
these risks and uncertainties relate to factors that are beyond the companies'
abilities to control or estimate precisely, such as future market conditions and
the behaviour of other market participants. Other unknown or unpredictable
factors could also cause actual results to differ materially from those in the
forward looking statements. Therefore undue reliance should not be placed on
such statements. Akzo Nobel and ICI assume no obligation and do not intend to
update these forward-looking statements, whether as a result of new information,
future events or otherwise, except as required pursuant to applicable law.
Dealing Disclosure Requirements
Under the provisions of Rule 8.3 of the City Code, if any person is, or becomes,
'interested' (directly or indirectly) in one per cent. or more of any class of '
relevant securities' of ICI, all 'dealings' in any 'relevant securities' of ICI
(including by means of an option in respect of, or a derivative referenced to,
any such 'relevant securities') must be publicly disclosed by no later than 3.30
pm (London time) on the London business day following the date of the relevant
transaction. This requirement will continue until the date on which the Scheme
becomes effective or the offer becomes, or is declared, unconditional as to
acceptances, lapses or is otherwise withdrawn or on which the 'offer period'
otherwise ends. If two or more persons act together pursuant to an agreement or
understanding, whether formal or informal, to acquire an 'interest' in 'relevant
securities' of ICI, they will be deemed to be a single person for the purposes
of Rule 8.3 of the City Code.
Under the provisions of Rule 8.1 of the City Code, all 'dealings' in 'relevant
securities' of ICI by ICI or Akzo Nobel, or by any of their respective '
associates', must be disclosed by no later than 12.00 noon (London time) on the
London business day following the date of the relevant transaction.
A disclosure table, giving details of the companies in whose 'relevant
securities' 'dealings' should be disclosed, and the number of such securities in
issue, can be found on the Panel's website at www.thetakeoverpanel.org.uk.
'Interests in securities' arise, in summary, when a person has long economic
exposure, whether conditional or absolute, to changes in the price of
securities. In particular, a person will be treated as having an 'interest' by
virtue of the ownership or control of securities, or by virtue of any option in
respect of, or derivative referenced to, securities.
Terms in quotation marks are defined in the City Code, which can also be found
on the Panel's website. If you are in any doubt as to whether or not you are
required to disclose a 'dealing' under Rule 8 of the City Code, you should
consult the Panel.
NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION (IN WHOLE OR IN PART) IN, INTO OR
FROM AUSTRALIA, CANADA OR JAPAN OR ANY OTHER JURISDICTION WHERE TO DO SO WOULD
CONSTITUTE A VIOLATION OF THE RELEVANT LAWS OF SUCH JURISDICTION
13 August 2007
RECOMMENDED CASH OFFER
FOR
IMPERIAL CHEMICAL INDUSTRIES PLC
BY
AKZO NOBEL N.V.
1. Introduction
The Board of Management and Supervisory Board of Akzo Nobel N.V. and the Board
of Imperial Chemical Industries PLC are pleased to announce that they have
reached agreement on the terms of a recommended cash offer by Akzo Nobel for the
entire issued and to be issued share capital of ICI, including the ICI Shares
underlying the ICI ADSs.
In connection with the acquisition of ICI, Akzo Nobel has entered into an
agreement with Henkel to sell all assets and liabilities comprising the business
divisions known within the ICI Group as the 'Adhesives Division' and the '
Electronic Materials Division', both of which form part of the 'National Starch'
business of ICI, for £2.7 billion (€4.0 billion) in cash (calculated on a debt
and cash free basis and subject to certain adjustments). The transaction with
Henkel is not a condition to the completion of Akzo Nobel's acquisition of ICI
and will be implemented following the Effective Date.
2. The Transaction
It is intended that the Transaction will be implemented by way of a
court-sanctioned scheme of arrangement under section 425 of the Companies Act
1985. Under the terms of the Scheme, which will be subject to the Conditions
and further terms set out in this announcement and to be set out in the Scheme
Document, ICI Shareholders (other than the holders of Excluded Shares) will,
subject to elections under the Loan Note Alternative, be entitled to receive:
For each ICI Share
670 pence in cash
It is expected that ICI ADS Holders will receive the consideration in respect of
the ICI Shares underlying their ICI ADSs in US dollars from the Depositary in
accordance with the terms of the Deposit Agreement upon surrender of their ADSs.
As each ICI ADS represents four ICI Shares, this will result in:
For each ICI ADS
2,680 pence in cash
In addition, ICI will, before the Effective Date, declare a second ordinary
interim dividend in relation to the period from 1 July 2007 to 31 December 2007
of 5 pence per ICI Share, provided that, if the Effective Date falls prior to 31
December 2007, such dividend shall be paid pro rata by reference to where the
Effective Date falls between 1 July 2007 and 31 December 2007. For the
avoidance of doubt, ICI Shareholders registered as such on the relevant record
date will retain their entitlement to receive the first ordinary interim
dividend of 4.95 pence per ICI Share declared on 2 August 2007.
The offer price of 670 pence per ICI Share values the entire existing issued
share capital of ICI at approximately £8.0 billion and represents a premium of
approximately:
• 22 per cent. to the Closing Price of 549 pence per ICI Share on 15
June 2007 (being the last Business Day prior to the announcement by ICI that it
had received an approach from Akzo Nobel);
• 35 per cent. to the average Closing Price of approximately 498 pence
per ICI Share for the six months ended 15 June 2007 (being the last Business Day
prior to the announcement by ICI that it had received an approach from Akzo
Nobel); and
• 44 per cent. to the Closing Price of 464 pence per ICI Share on 9
March 2007 (being the last Business Day prior to Akzo Nobel's announcement in
relation to the disposal of Organon BioSciences).
ICI Shareholders (other than Restricted Overseas Persons) will have the option
of taking Loan Notes instead of cash.
The Scheme will be put to Scheme Shareholders at the Court Meeting and to ICI
Shareholders at the ICI EGM. The Transaction is subject to the approval of Akzo
Nobel's shareholders and will be put to Akzo Nobel shareholders at the Akzo
Nobel EGM. Subject to the satisfaction of the Conditions, it is expected that
the Scheme will become effective during late November or early December 2007.
3. Recommendation
The directors of ICI, who have been so advised by Merrill Lynch and UBS,
consider the terms of the Transaction to be fair and reasonable. In providing
their advice, Merrill Lynch and UBS have taken into account the commercial
assessments of the directors of ICI. In addition, the directors of ICI consider
the terms of the Transaction to be in the best interests of ICI Shareholders as
a whole.
Accordingly, the directors of ICI intend unanimously to recommend that ICI
Shareholders vote in favour of the Scheme and the resolutions to be proposed at
the Court Meeting and the ICI EGM (or, if the Transaction is implemented by way
of a takeover offer, that they accept or procure acceptance of such offer) as
they have irrevocably undertaken to do in respect of their own beneficial
shareholdings of 654,111 ICI Shares, representing (as at the date of this
announcement) approximately 0.055 per cent. of the existing issued share capital
of ICI.
4. Background to and reasons for the Transaction
Akzo Nobel believes that the Transaction, in combination with the On-Sale, has a
clear and compelling strategic and financial rationale for Akzo Nobel, with
significant benefits for its shareholders and other stakeholders. The
Transaction provides the opportunity for Akzo Nobel and ICI to create a global
leader in coatings with sales of approximately €9.8 billion (£6.6 billion),
complementary brands, assets and skills, and leading positions in attractive
specialty chemicals markets.
• The enlarged Akzo Nobel group will benefit from:
• a worldwide footprint with a presence in more than 80 countries
and the ability to serve customers worldwide;
• a leading position in many of the world's largest markets as a
foundation for earnings and cash flow stability;
• a significantly strengthened decorative coatings business with
pro forma combined sales of approximately €5.5 billion (£3.7 billion);
• well developed platforms in the world's fastest growing markets
in Asia-Pacific, particularly China and Latin America, which Akzo Nobel expects
will support enhanced future growth; and
• a management team with a track record of improving
profitability.
• Akzo Nobel estimates full run-rate annual pre-tax operating cost
savings in relation to the ICI paints business of €280 million (£189 million):
• these cost savings are expected to be predominantly based on
combined raw material procurement volumes (€65 million, £44 million),
streamlining of operations (€65 million, £44 million) and a reduction of other
expenses (including R&D and selling, general and administrative, corporate and
other) (€150 million, £101 million);
• the one-off expenses involved in obtaining such savings are
anticipated to be approximately €315 million (£213 million); and
• in addition, Akzo Nobel expects to achieve synergies from
increased sales across the combined portfolio.
• Through a rapid but considered integration, as well as the mutual
exchange of best practices in all functions, regions and market segments, the
enlarged Akzo Nobel group will strive to unlock value for shareholders and
create opportunities for customers and employees. Akzo Nobel believes that the
Transaction will further enhance its proven capability to execute a profitable
growth strategy. The Transaction is expected to be:
• as a whole, enhancing to earnings (see notes 1 and 2 below);
• generative of an internal rate of return meaningfully above Akzo
Nobel's weighted average cost of capital (defined as 8 per cent.); and
• EVA positive in year three following the Transaction, taking
into account the On-Sale, cost synergies after one-off expenses, existing
favourable tax attributes that Akzo Nobel estimates to result in a tax rate of
22 per cent. for the ICI businesses for the three year period following the
Transaction and break-up costs (see notes 1 and 2 below).
• Akzo Nobel views the appropriate capital structure for a specialty
chemicals business to be one which supports a solid investment grade rating.
Consistent with this objective, in addition to its existing share buyback
programme of approximately €1.6 billion (£1.1 billion), Akzo Nobel is
considering an additional return of capital to its shareholders of up to €3
billion (£2 billion) commencing in 2008, subject to shareholder approval and to
completion of the sale of Organon BioSciences and the completion of the On-Sale.
It is Akzo Nobel's intention to structure the additional return of capital in a
tax efficient manner for its shareholders generally.
5. Background to and reasons for the recommendation
Since 2003, the ICI management team has transformed ICI through the successful
implementation of an operational and strategic restructuring programme designed
to refocus the group around its core businesses to generate sustainable
profitable growth and significant improvements in cash flow. As a result, over
this period, ICI has delivered consistent improvements in return on capital
employed and significant total shareholder returns.
During 2006, ICI made significant progress in focusing ICI's portfolio on its
coatings, adhesives and starch businesses through the disposals of Uniqema and
Quest. The disposal proceeds and the significant reduction in the net pension
deficit delivered a much stronger balance sheet allowing the continued
investment in strengthening the competitive positions of the core businesses.
In February 2007 ICI set out an updated strategy reinforcing ICI's vision of
achieving leadership in formulation science through focusing on three strategic
objectives; accelerating profitable growth, improving operational effectiveness
and developing a culture of sustainable improvement. During the first six
months of 2007, the ICI Group made good progress developing and implementing
plans to deliver the revised strategy.
On 6 August 2007, following two prior approaches and discussions between the
parties, the directors of ICI announced that they had received an indicative
proposal from Akzo Nobel under which Akzo Nobel would acquire ICI for 670 pence
per share in cash. In addition, ICI Shareholders registered as such on the
relevant record date would receive ICI's first interim dividend of 4.95 pence
per share announced on 2 August 2007, together with a second ordinary interim
dividend of 5 pence per share, provided that, if the completion date fell prior
to 31 December 2007, such dividend would be paid pro rata by reference to where
the completion date fell between 1 July 2007 and 31 December 2007. The proposal
was subject to a number of pre-conditions, including completion of due
diligence. The directors of ICI agreed that Akzo Nobel could undertake certain
due diligence alongside further detailed negotiations regarding the
pre-conditions and conditions to an offer, resulting in the Transaction that is
being recommended by the directors of ICI. Notwithstanding the significant
achievements of ICI over past years, the directors of ICI believe that the offer
price of 670 pence per share reflects ICI's strong future prospects and growth
opportunities and represents an opportunity for ICI's Shareholders to receive an
attractive cash premium now and is therefore in the best interests of its
shareholders as a whole. Accordingly, the directors of ICI intend unanimously
to recommend that ICI Shareholders vote in favour of the Scheme.
6. Proposed transaction with Henkel
In connection with the Transaction, Akzo Nobel has entered into a binding
agreement to sell certain shares and assets comprising the business divisions
known within the ICI Group as the Adhesives Division and the Electronic
Materials Division, both of which form part of the National Starch business of
ICI, to Henkel for £2.7 billion (€4.0 billion) in cash (calculated on a cash and
debt free basis and subject to certain adjustments, including a working capital
adjustment and an adjustment for pension liabilities). The transaction with
Henkel is not a condition to completion of the Transaction and will be
implemented following the Effective Date.
Akzo Nobel estimates that the separation of the Adhesives Division and the
Electronic Materials Division will result in total break-up costs of £280
million (€414 million), including tax, which will be borne by Akzo Nobel.
Akzo Nobel believes that the On-Sale has a compelling rationale as it:
• enables Akzo Nobel and Henkel to each focus on the businesses that
offer them most synergies thereby meeting their respective stated strategic and
financial objectives;
• allows Akzo Nobel to make an offer of 670 pence in cash for each ICI
Share. Pro forma for full run-rate synergies, the implied LTM EBITDA
acquisition multiple under the terms of the Transaction (for the businesses
other than the Adhesives Division and the Electronic Materials Division to be
sold pursuant to the On-Sale) is approximately equal to the implied LTM EBITDA
acquisition multiple of Akzo Nobel's first proposal for all of ICI's businesses
of 600 pence in cash for each ICI Share; and
• allows Akzo Nobel to return further cash to its shareholders from the
consideration to be received.
The On-Sale Agreement with Henkel is conditional only upon the Scheme becoming
effective and certain mandatory antitrust clearances being obtained by Henkel.
Completion of the On-Sale Agreement (including payment of the purchase price)
will occur four months after the Effective Date if the clearance required under
the HSR Act has been obtained or at such later date as such clearance is
obtained (or earlier than four months if all antitrust clearances, including
under the HSR Act, are obtained before that time). Assets will be transferred
to Henkel as relevant clearances are received or, if such clearances are not
ultimately received, any assets which cannot be transferred to Henkel will be
sold to a permitted third party. This arrangement will not apply whilst the
clearance required under the HSR Act remains outstanding. In these
circumstances, Henkel will be required to do everything it can to obtain that
clearance and to complete the On-Sale Agreement within ten months of the
Effective Date.
In addition to the On-Sale Agreement, Henkel has entered into a standstill
agreement with Akzo Nobel under which Henkel has agreed, among other things, not
to, and to procure that no member of its group or any person acting in concert
with it will, acquire any interest in the securities of ICI. Henkel's
obligations under the standstill agreement are subject to customary exclusions
and expire upon the earlier of the Effective Date and the Transaction lapsing in
accordance with its terms.
7. Akzo Nobel's intentions for ICI
A successful integration of ICI's coatings business is key to creating a leading
global coatings business with enhanced scale and significantly added value in
high growth coatings markets.
Akzo Nobel has agreed to sell the Adhesives Division and the Electronic
Materials Division to Henkel. The remaining National Starch businesses, while
providing attractive near term growth and margin potential, will be reviewed in
due course. These businesses reported revenues of £768 million (€1,135 million)
and an EBITDA of £137 million (€202 million) for the financial year ended 31
December 2006.
8. Management, employees and locations
Akzo Nobel attaches great importance to the skills and experience of the
existing management and employees of ICI who will be critical to the success of
the enlarged Akzo Nobel group. The employees and management of ICI will benefit
from Akzo Nobel's 'Talent Factory' initiative which provides worldwide best
practice HR processes to all businesses and their employees. Akzo Nobel fully
understands that the value of the Transaction is dependent on the motivation,
commitment and performance of ICI's employees. It is Akzo Nobel's intention to
employ the best talents in the enlarged Akzo Nobel group.
Akzo Nobel confirms that the existing employment rights, including pension
rights, of all management and employees of ICI will be fully safeguarded. In
addition, Akzo Nobel recognises that ICI has a longstanding practice of seeking
to protect employee terms and conditions in the context of its previous
divestments. In light of this, Akzo Nobel has confirmed to ICI that:
• for a period of two years from the Effective Date, ICI employees will
continue to enjoy terms relating to redundancy and retirement benefits that are
as favourable in overall terms as those that apply as at the date of this
announcement; and
• for a period of four years from the Effective Date, ICI employees
will, subject to any changes necessary to facilitate the integration of the
combined workforce and harmonisation of their terms and conditions, continue to
enjoy other terms and conditions that are as favourable in overall terms as
those that apply as at the date of this announcement.
Henkel has given similar assurances in respect of the employees of the Adhesives
Division and the Electronic Materials Division.
Akzo Nobel will continue to be headquartered in The Netherlands.
9. ICI Pension Schemes
Akzo Nobel has reached agreement with ICI Pensions Trustee Limited, the trustee
of the ICI Pension Fund (UK). The terms of this agreement include an
undertaking by Akzo Nobel that it will, following the Effective Date, guarantee
the due performance by ICI of all its obligations to make payments to the ICI
Pension Fund (UK) in accordance with the terms of the agreement and an
understanding in relation to the future determination of the liabilities and
funding of the ICI Pension Fund (UK).
No specific arrangements have been entered into with the trustees or managing
entities of any of ICI's other retirement benefit schemes. However, Akzo Nobel
has confirmed to ICI that, following the Effective Date, a member of the
enlarged Akzo Nobel group with adequate financial standing will be bound by
those obligations in respect of such retirement benefit schemes as bind members
of the ICI Group at the date of this announcement.
10. ICI Share Schemes
Participants in the ICI Share Schemes will be contacted regarding the effect of
the Transaction on their rights under these schemes and appropriate proposals
will be made to such participants in due course.
Further details of these proposals will be set out in the Scheme Document.
11. Financing
Akzo Nobel has obtained committed bank facilities for the purposes of the
Transaction, which have been arranged by ABN AMRO Bank N.V., Barclays Capital
(the investment banking division of Barclays Bank PLC), BNP Paribas, Citigroup
Global Markets Limited, Deutsche Bank AG, London Branch, HSBC Bank plc, ING Bank
N.V., Morgan Stanley Bank International Limited and Societe Generale Corporate &
Investment Banking. Morgan Stanley is satisfied that the necessary financial
resources are available to Akzo Nobel to enable it to satisfy in full the cash
consideration payable under the Scheme.
It is intended that these facilities will primarily serve as a bridge to the
cash proceeds Akzo Nobel is expecting from its proposed sale of Organon
BioSciences to Schering-Plough and under the On-Sale Agreement entered into with
Henkel. The sale of Organon BioSciences is expected to complete before the end
of this year and will generate cash proceeds of approximately €11 billion.
The cash consideration payable by Akzo Nobel following the completion of the
Transaction will be commensurately reduced by an issue of Loan Notes pursuant to
elections under the Loan Note Alternative.
Further information on the financing of the Transaction will be set out in the
Scheme Document.
12. Information on ICI
ICI is one of the world's major coatings, adhesives, starch and synthetic
polymers businesses. ICI products today include a wide range of industrial
adhesives, specialty starches for the food industry, high performance polymers
for personal care products, innovative adhesives for the electronics and
packaging markets as well as a wide range of decorative coatings and specialty
products for domestic use and in the construction industry, including coatings
products marketed under the Dulux and Glidden brands. Around 36 per cent. of
ICI's sales from continued operations are made in emerging markets in Asia
Pacific and Latin America, with approximately 33 per cent. in North America and
approximately 31 per cent. in Europe and elsewhere.
For the financial year ended 31 December 2006, ICI reported revenues of £4,845
million (2005: £4,601 million) and profits before taxation of £355 million
(2005: £397 million). As of 30 June 2007, ICI had net cash of £271 million
(£329 million of net debt as of 31 December 2006) and total equity of £1,012
million (£(189) million as of 31 December 2006). ICI is listed on the London
Stock Exchange and is a member of the FTSE100 Index, FTSE4Good Index and the Dow
Jones Sustainability Index.
13. Information on Akzo Nobel
Akzo Nobel, headquartered in The Netherlands, serves customers throughout the
world with coatings and chemicals. Akzo Nobel employs approximately 43,000
people in these two business segments and conducts its activities with operating
subsidiaries in more than 80 countries.
In addition, Akzo Nobel currently owns a human and animal healthcare subsidiary,
Organon BioSciences. Akzo Nobel announced on 12 March 2007 that it had received
an offer for this business from Schering-Plough for approximately €11 billion in
cash. Shareholder approval has been obtained for the divestiture of this
business and Akzo Nobel expects this transaction to complete before the end of
this year, after consultation with social partners, and clearance from
regulatory bodies.
For the financial year ended 31 December 2006, Akzo Nobel reported revenues of
€13,737 million (2005: €13,000 million), and profits of €1,182 million (2005:
€998 million). As of 30 June 2007, Akzo Nobel had shareholders' equity of
€3,956 million (€4,144 million as of 31 December 2006) and invested capital of
€8,127 million (€8,060 million as of 31 December 2006). Akzo Nobel is a Global
Fortune 500 company and is listed on Euronext Amsterdam and the NASDAQ, although
Akzo Nobel has announced that it intends to delist from the NASDAQ. It is also
included in the FTSE4Good Index and the Dow Jones Sustainability Index.
14. Information on Henkel
Established more than 130 years ago, Henkel is a leading producer of home care,
personal care, and adhesives technologies products and ranks among the Fortune
Global 500 companies. In the year ended 31 December 2006, Henkel generated
revenues of €12,740 million and operating profit of €1,298 million. Henkel has
approximately 52,000 employees worldwide and its brands and technologies are
sold in more than 125 countries.
15. Irrevocable undertakings
Akzo Nobel has received undertakings to vote in favour of the Transaction and
the resolutions to be proposed at the Court Meeting and the ICI EGM from the
directors of ICI in respect of 654,111 ICI Shares, representing approximately
0.055 per cent. of the existing issued share capital of ICI. These undertakings
are in respect of their aggregate entire beneficial holdings of ICI Shares.
These undertakings will cease to have any effect if the Scheme fails or is
withdrawn (or, if the Transaction is implemented by way of a takeover offer, the
offer lapses or is withdrawn).
Further details of these irrevocable undertakings are set out in Appendix III to
this announcement.
16. Structure of the Transaction
It is intended that the Transaction will be effected by means of a
court-sanctioned scheme of arrangement between ICI and the Scheme Shareholders
under section 425 of the Companies Act 1985.
The purpose of the Scheme is to provide for Akzo Nobel to become the owner of
the whole of the issued share capital of ICI. This is to be achieved by the
cancellation (or, in relation to the Loan Note Elected Shares, the transfer) of
the Scheme Shares and the application of the reserve arising from such
cancellation in paying up in full a number of new ICI Shares (which is equal to
the number of Scheme Shares cancelled) and issuing the same to Akzo Nobel, in
consideration for which Scheme Shareholders, including ICI ADS Holders, will
receive consideration on the basis set out in paragraph 2 of this announcement.
The Loan Note Elected Shares will be acquired by Akzo Nobel fully paid with full
title guarantee and free from all liens, equitable interests, charges,
encumbrances, rights of pre-emption and other third party rights of any nature
whatsoever and together with all rights attaching to them, including the right
to receive and retain all dividends and distributions (if any) declared, made or
paid after the date of this announcement (other than the Interim Dividends).
The Scheme is subject to the Conditions and certain further terms referred to in
Appendix I to this announcement and to be set out in the Scheme Document. In
particular, the Scheme requires the approval of holders of Scheme Shares by the
passing of a resolution at the Court Meeting. That resolution must be approved
by a majority in number of the ICI Shareholders present, entitled to vote and
voting at the Court Meeting (or at any adjournment thereof), either in person or
by proxy, representing not less than three-fourths in value of all ICI Shares
which are voted at the Court Meeting (or at any adjournment thereof).
Implementation of the Scheme will also require the passing of the Special
Resolution at the ICI EGM, which will be held immediately after the Court
Meeting.
Following the Meetings, the Scheme must be sanctioned and the Reduction
confirmed by the Court, and will only become effective on delivery to the
Registrar of Companies of:
• a copy of the Scheme Court Order; and
• a copy of the Reduction Court Order,
and, in the case of the Reduction Court Order, it being registered by the
Registrar of Companies together with the minute of the Reduction attached
thereto.
Upon the Scheme becoming effective, it will be binding on all ICI Shareholders,
irrespective of whether or not they attended or voted at the Court Meeting or
the ICI EGM.
The Scheme will contain a provision for ICI to consent, on behalf of all persons
concerned, to any modification of or addition to the Scheme or to any condition
that the Court may approve or impose. ICI has been advised that it is unlikely
that the Court would impose any condition to the Scheme that might be material
to the interests of ICI Shareholders unless ICI Shareholders were informed in
advance.
ICI ADS Holders are expected to be given the opportunity to instruct the
Depositary how to vote the ICI Shares underlying their ICI ADSs. ICI ADS
Holders are expected to receive their consideration through the facilities of
the Depositary under the Deposit Agreement. It is expected that the ICI ADS
programme will be terminated following the Effective Date.
Further details of the Scheme, including the timetable for its implementation,
will be set out in the Scheme Document (which, due in part to the limited
availability of Court dates, is expected to be posted to ICI Shareholders on or
around 24 September 2007). An announcement as to the exact posting date will be
made as and when appropriate.
17. Loan Note Alternative
As an alternative to some or all of the cash consideration which would otherwise
be receivable under the Scheme, ICI Shareholders (other than Restricted Overseas
Persons, who may not participate in the Loan Note Alternative) will, subject to
the conditions and further terms which will be set out in the Scheme Document
and the form of election for the Loan Note Alternative, be able to elect to
receive Loan Notes to be issued by Akzo Nobel on the following basis:
For every £1 of cash consideration £1 nominal value of Loan
Notes
Up to a maximum amount of £1.25 billion of Loan Notes in aggregate nominal value
will be available under the Loan Note Alternative. To the extent that ICI
Shareholders validly elect to receive Loan Notes pursuant to the Loan Note
Alternative which in aggregate nominal value exceed such amount, the entitlement
of each ICI Shareholder who so validly elects will be scaled down pro rata to
the number of ICI Shares in respect of which he has elected for the Loan Note
Alternative. The Loan Notes will be issued credited as fully paid, in amounts
and integral multiples of £1 and the balance of any entitlement that is not a
whole multiple of £1 will be disregarded and not issued. If the Loan Notes are
issued by a subsidiary of Akzo Nobel, the issuer's obligations under the Loan
Notes as to principal and interest will be guaranteed by Akzo Nobel or cash
collateralised. The Loan Notes will in all cases be issued by the sole
acquiring company (or otherwise issued in a way that does not prejudice the
interests of the holders of the Loan Notes, in particular with respect to
rollover relief).
The Loan Notes will bear interest at a rate of 0.50 per cent. below six-month
sterling LIBOR to be determined on the first business day of each interest
period. Interest will be payable by half-yearly instalments in arrear on 30 June
and 31 December in each year. The first payment of interest will be made on the
first payment date which falls more than six months after the date of issue of
the Loan Notes. On the first payment date, interest will be paid in respect of
the period from (and including) the date of issue of the relevant Loan Notes to
(but excluding) the first payment date.
Unless Akzo Nobel decides otherwise, no Loan Notes will be issued unless, on or
before the Effective Date, the aggregate nominal value of all Loan Notes to be
issued as a result of valid election for the Loan Note Alternative is £20
million or more. If such aggregate nominal value is less than £20 million, any
such election shall, unless Akzo Nobel decides otherwise, be void and the
relevant ICI Shareholders will be deemed to have elected to receive cash.
The issuer may redeem all (but not some only) of the Loan Notes (so long as they
have been in issue for at least six months) if the aggregate nominal value of
the outstanding Loan Notes falls below the higher of £10 million and 15 per
cent. of the Loan Notes issued. The issuer may purchase any Loan Notes which
have been in issue for more than six months at a price by tender available to
all holders of Loan Notes alike, or otherwise by agreement with any holders of
Loan Notes. The Loan Notes will be redeemable, on not less than 14 days'
notice, in whole or in part for cash at par, together with any accrued interest,
at the option of noteholders on any payment date between the first payment date
and the payment date which next follows the fifth anniversary of the Effective
Date (both dates inclusive). The Loan Notes may be redeemed in minimum
denominations of £1,000 or, if lower, the holder's entire holding of Loan Notes.
If not previously redeemed, the final redemption date will be the payment date
which next follows the fifth anniversary of the Effective Date. Any Loan Notes
outstanding on the final redemption date will be redeemed at par together with
any accrued interest on that date.
The Loan Notes will be transferable but no application will be made for them to
be listed on, or dealt on, any stock exchange or other trading facility. If
Akzo Nobel elects to implement the Transaction by making a takeover offer, Akzo
Nobel will decide at the time of election whether (and, if so, to what extent)
the Loan Notes will be transferable.
Loan Notes that may be issued pursuant to the Scheme have not been and will not
be registered under the US Securities Act or under the relevant securities laws
of any state or territory or other jurisdiction of the United States.
Accordingly, the Loan Notes may not be offered, sold or resold in the United
States, except in a transaction not subject to, or in reliance on an exemption
from, the registration requirements of the US Securities Act and the relevant
securities laws of any state or territory or other jurisdiction of the United
States.
Unless Akzo Nobel otherwise determines, the relevant clearances and
registrations have not been, nor will they be, sought or obtained, nor have any
steps been taken, nor will any steps be taken, to enable the Loan Notes to be
publicly offered in compliance with applicable securities laws of Australia,
Japan or any other jurisdiction. Accordingly, the Loan Notes (subject to certain
exceptions) may not be offered, sold, resold, transferred, or delivered,
directly or indirectly, in, into or from Australia or Japan or any other
jurisdiction where to do so would violate the laws of that jurisdiction or would
require registration thereof in such jurisdiction.
The Loan Note Alternative will be conditional upon the Scheme becoming
unconditional and effective and will remain open for election until the deadline
which will be stated in the Scheme Document.
The Loan Notes and the relevant Loan Note instrument will be governed by, and
construed in accordance with, English law and will be direct unsecured and
unsubordinated obligations of the issuer.
The terms of the Loan Notes will be such that the Loan Notes will not constitute
qualifying corporate bonds for individuals for the purposes of UK taxation. Full
details of the Loan Notes and the Loan Note Alternative will be contained in the
Scheme Document.
18. Non-Solicitation Agreement
ICI and Akzo Nobel have entered into the Non-Solicitation Agreement, the
principal terms of which are set out below.
ICI has undertaken:
• not to solicit, encourage, initiate or otherwise seek to procure any
competing proposal (including by disclosing due diligence information), or to
enter into any communications, discussions, negotiations, correspondence or
arrangement with a view to soliciting any competing proposal; and
• to notify Akzo Nobel if: (i) ICI or any other member of the ICI Group
(or any of its or their agents or advisers) receives a proposal or approach from
a third party (or a revised proposal or renewed contact from a third party that
has previously made a proposal or approach) in relation to any competing
proposal which is notified to the ICI Board, and to keep Akzo Nobel informed as
to the progress of such competing proposal (such notification to include details
as to price, form of consideration, timetable and conditionality); and (ii) ICI
receives any request for information under Rule 20.2 of the City Code, such
notification to Akzo Nobel to be made within 24 hours after the ICI Board has
been notified of any such proposal or request.
These obligations will fall away if, among other things, the Scheme lapses or
otherwise fails to complete.
Such obligations do not: (i) preclude ICI or any other member of the ICI Group
(or any of its or their agents or advisers) from providing to any potential
offeror any information required to be provided to it under Rule 20.2 of the
City Code; or (ii) inhibit the directors of ICI from taking any actions
following receipt of a competing proposal made by a third party without ICI's
solicitation to the extent that to do so would, in the reasonable opinion of the
directors of ICI (having taken independent legal advice), be required in order
for them to comply with their fiduciary and directors' duties to ICI and any
duties arising under the City Code.
19. Implementation Agreement
ICI and Akzo Nobel have entered into the Implementation Agreement, which
contains certain obligations in relation to the implementation of the Scheme and
the conduct of ICI's business prior to the Effective Date or the termination of
such agreement. In particular, the Implementation Agreement contains the terms
summarised below.
ICI will pay an inducement fee to Akzo Nobel if:
• a competing proposal is announced (whether under Rule 2.4 or 2.5 of
the City Code) prior to the withdrawal, lapse, termination or other failure of
the Transaction and that competing proposal is subsequently completed;
• the Scheme Document does not contain the unanimous and unqualified
recommendation of the ICI Board to vote in favour of the Scheme and the
resolutions to be proposed at the Court Meeting and the ICI EGM or, if ICI
elects to implement the Transaction by means of a takeover offer, the offer
document does not contain the unanimous and unqualified recommendation of the
ICI Board to accept such offer, and, in either case, the Transaction does not
become effective;
• the ICI Board withdraws, qualifies or adversely modifies its
recommendation to ICI Shareholders and the Transaction does not become
effective; or
• if the Transaction is implemented by means of the Scheme and the
resolutions to be proposed at the Court Meeting and the ICI EGM have been passed
by the requisite majorities, the ICI Board does not, except as agreed by Akzo
Nobel, seek to obtain the Scheme Court Order and the Reduction Court Order or
does not file the Court Orders, together with the minute of the Reduction, with
the Registrar of Companies by 12 noon on the Business Day next following the day
that the Reduction Court Order is granted.
Akzo Nobel will pay an inducement fee to ICI if:
• Akzo Nobel fails to use its reasonable endeavours to make available
the Akzo Nobel Documentation by an agreed date;
• the Akzo Nobel Documentation does not contain the unanimous and
unqualified recommendation of the Board of Management and/or the Supervisory
Board to vote in favour of the resolution to be proposed at the Akzo Nobel EGM
to approve the Transaction; or
• following the despatch of the Akzo Nobel Documentation and on or prior
to the date of the Akzo Nobel EGM, the Board of Management and the Supervisory
Board withdraw, qualify or adversely modify their recommendation to Akzo Nobel
shareholders or otherwise seek to cancel the Akzo Nobel EGM and, as a
consequence, the Transaction is not approved by Akzo Nobel's shareholders.
The inducement fee payable by ICI or Akzo Nobel, as the case may be, is an
amount (including any applicable VAT) equal to one per cent. of the value of the
Transaction calculated by reference to the price per ICI Share set out in this
announcement (or, if the price is revised, the price per ICI Share last offered
by Akzo Nobel) and the fully diluted share capital of ICI.
As set out in Appendix I to this announcement, the Transaction is subject to the
receipt of certain antitrust clearances. Akzo Nobel has agreed to use its best
endeavours to procure that these antitrust clearances are obtained, which
includes agreeing to make any disposals or giving any undertakings or agreeing
to any conditions that may be required by any relevant antitrust authority.
In addition, Akzo Nobel has agreed that, if the Transaction does not become
effective for reasons other than the failure to receive required antitrust
clearances, a material adverse change having occurred in the business or
financial position of the ICI Group or the ICI Shareholders not passing the
required resolutions at the Court Meeting and the EGM, Akzo Nobel will reimburse
ICI for costs and expenses incurred in respect of or in connection with the
Transaction up to a maximum of £50 million.
Further information regarding the Implementation Agreement will be set out in
the Scheme Document.
20. Delisting and re-registration
Prior to the Scheme becoming effective, ICI will make an application to the
London Stock Exchange to cancel trading in the ICI Shares on its market for
listed securities and to the UK Listing Authority to cancel the listing of the
ICI Shares from the Official List on the Effective Date.
On the Effective Date, share certificates in respect of the ICI Shares will
cease to be valid and entitlements to ICI Shares held within the CREST system
will be cancelled. It is also proposed that, following the Effective Date and
after its shares are delisted, ICI will be re-registered as a private limited
company.
21. Disclosure of interests in ICI
Except as disclosed below, as at the close of business on 10 August 2007 (being
the last Business Day prior to the date of this announcement), neither Akzo
Nobel nor any of its directors nor, so far as Akzo Nobel is aware, any party
acting in concert with Akzo Nobel (i) has any interest in or right to subscribe
for relevant ICI securities or (ii) has any short positions in respect of
relevant ICI securities (whether conditional or absolute and whether in the
money or otherwise), including any short position under a derivative, any
agreement to sell or any delivery obligation or right to require another person
to take delivery, or (iii) has borrowed or lent any relevant ICI securities
(save for any borrowed shares which have been on-lent or sold):
Party Interest in ICI securities
Morgan Stanley Long 1,136,743
Short 502,513
Net 634,230
Lehman Brothers Long 237,495
Short 25,805
Net 211,690
'Interests in securities' is further explained in the paragraph headed 'Dealing
Disclosure Requirements' below.
22. Overseas shareholders
The availability of the Transaction to ICI Shareholders who are not resident in
the UK, the US or The Netherlands may be affected by the laws of their relevant
jurisdiction. Such persons should inform themselves of, and observe, any
applicable legal or regulatory requirements of their jurisdiction. ICI
Shareholders who are in any doubt regarding such matters should consult an
appropriate independent professional adviser in the relevant jurisdiction
without delay.
The Loan Note Alternative will not be available to Restricted Overseas Persons.
Such persons will only be entitled to receive cash consideration, and will not
be eligible to receive Loan Notes as consideration pursuant to the Loan Note
Alternative.
23. General
Akzo Nobel reserves the right to elect to implement the acquisition of the ICI
Shares by way of a takeover offer as an alternative to the Scheme. Any such
takeover offer will be subject to a 90 per cent. acceptance condition or such
lesser percentage, being more than 50 per cent., as Akzo Nobel may decide
(subject to the consent of the Panel) and be implemented on the same terms
(subject to appropriate amendments), so far as applicable, as those which would
apply to the Scheme and in compliance with applicable laws and regulations.
Further, if sufficient acceptances of such offer are received and/or sufficient
ICI Shares are otherwise acquired, it is the intention of Akzo Nobel to apply
the provisions of Chapter 3 of Part 28 of the Companies Act 2006 to acquire
compulsorily any outstanding ICI Shares to which such offer relates.
The Transaction may be effected by one or more Subsidiaries of Akzo Nobel in
addition to or in place of Akzo Nobel. Details of any such Subsidiaries will be
included in the Scheme Document. References to Akzo Nobel in this announcement
(including in relation to the identity of the issuer of the Loan Notes) should
be construed accordingly.
The Transaction will be subject to the Conditions and certain further terms set
out in Appendix I and the further terms and conditions to be set out in the
Scheme Document.
The bases and sources of certain information contained in this announcement are
set out in Appendix II. Further details of the irrevocable undertakings are set
out in Appendix III and certain terms used in this announcement are defined in
Appendix IV.
The Scheme will be governed by English law. The Scheme will be subject to the
applicable requirements of the City Code, the Panel, the London Stock Exchange
and the UK Listing Authority.
The Scheme Document is expected to be posted to ICI Shareholders on or around 24
September 2007.
Notes:
1. Before purchase accounting for the Transaction.
2. This statement is not a profit forecast and should not be
interpreted to mean that future earnings per share will necessarily be greater
than those for the relevant preceding financial period.
Enquiries:
AKZO NOBEL
Dick Luijckx (Investor Relations) Tel: +31 26 366 4317
Tim van der Zanden (Financial Communications Officer Tel: +31 26 366 4343
(London))
Heleen van de Lustgraaf (Communications Manager (Holland)) Tel: +31 26 366 4343
MORGAN STANLEY & CO. LIMITED Tel: +44 207 425 8000
(Financial adviser to Akzo Nobel)
Simon Robey
Johannes Groeller
Jan Weber
SMITHFIELD
(PR adviser to Akzo Nobel)
John Kiely Tel: +44 207 360 4900
ICI
John Dawson (Vice President of Investor Relations & Tel: +44 207 009 5315
Corporate Communications)
Regina Kilfoyle (Director of Corporate Communications) Tel: +44 207 009 5410
MERRILL LYNCH Tel: +44 207 628 1000
(Financial adviser and corporate broker to ICI)
Matthew Greenburgh
Richard Taylor
Michael Findlay (Corporate Broking)
Ken McLaren
UBS LIMITED Tel: +44 207 567 8000
(Financial adviser and corporate broker to ICI)
Robin Budenberg
Jonathan Bewes
Jackie Lee
James Archer
This announcement is not intended to and does not constitute or form any part of
an offer to sell, or an invitation to subscribe for or purchase, any securities
or the solicitation of any vote or approval in any jurisdiction pursuant to the
Transaction or otherwise. The Transaction will be made solely through the
Scheme Document, which will contain the full terms and conditions of the
Transaction (including details of how to vote in respect of the Transaction).
Any acceptance or other response to the Transaction should be made only on the
basis of the information in the Scheme Document. ICI Shareholders are advised to
read the formal documentation of the Transaction carefully once it has been
dispatched.
Morgan Stanley is acting exclusively for Akzo Nobel in connection with the
Transaction and no one else and will not be responsible to anyone other than
Akzo Nobel for providing the protections afforded to clients of Morgan Stanley
or for providing advice in relation to the Transaction or any other transaction,
arrangement or matter referred to in this announcement.
Merrill Lynch is acting exclusively for ICI in connection with the Transaction
and no one else and will not be responsible to anyone other than ICI for
providing the protections afforded to clients of Merrill Lynch or for providing
advice in relation to the Transaction or any other transaction, arrangement or
matter referred to in this announcement.
UBS is acting exclusively for ICI in connection with the Transaction and no one
else and will not be responsible to anyone other than ICI for providing the
protections afforded to clients of UBS or for providing advice in relation to
the Transaction or any other transaction, arrangement or matter referred to in
this announcement.
The availability of the Transaction to persons who are not resident in the UK,
the US or The Netherlands may be affected by the laws of the relevant
jurisdictions. Persons who are not so resident should inform themselves about,
and observe, any applicable requirements. Further details in relation to
overseas shareholders will be contained in the Scheme Document.
The release, publication or distribution of this announcement in jurisdictions
other than the UK, the US or The Netherlands may be restricted by law and
therefore any persons who are subject to the laws of any jurisdiction other than
the UK, the US or The Netherlands should inform themselves about, and observe,
any applicable requirements. Any failure to comply with the applicable
requirements may constitute a violation of the securities laws of any such
jurisdiction. This announcement has been prepared for the purpose of complying
with English law and the City Code and the information disclosed may not be the
same as that which would have been disclosed if this announcement had been
prepared in accordance with the laws of jurisdictions outside the UK.
Any person (including, without limitation, any custodian, nominee or trustee)
who would, or otherwise intends to, or who may have a contractual or legal
obligation to, forward this announcement, the Scheme Document and/or any other
related document to any jurisdiction outside the UK, the US and The Netherlands
should inform themselves of, and observe, any applicable legal or regulatory
requirements of their jurisdiction.
The Loan Notes that may be issued pursuant to the Transaction have not been and
will not be registered under the US Securities Act or under the relevant
securities laws of any state, district or territory or other jurisdiction of the
US. Accordingly, Loan Notes may not be offered or sold in the US or to any US
Person or any ICI ADS Holder.
Loan Notes which may be issued pursuant to the Transaction have not been, and
will not be, registered under the relevant securities laws of Japan and any
relevant clearances and registrations have not been, and will not be, obtained
from the securities commission of Canada. No securities registration statement
in relation to the Loan Notes has been, or will be, filed with the Kanto local
finance bureau of Japan or any other local finance bureau of the Japanese
Ministry of Finance. No prospectus in relation to the Loan Notes has been, or
will be, lodged or registered with the Australian Securities and Investments
Commission, the Japanese Ministry of Finance or the Companies Office in New
Zealand. Accordingly, unless otherwise determined by Akzo Nobel and permitted
by applicable law and regulation, Loan Notes may not be offered, sold, resold,
transferred, delivered or distributed, directly or indirectly, in or into or to
persons in Australia, Japan or The Netherlands, or any other jurisdiction where
to do so would violate the laws of that jurisdiction or would require
registration thereof in such jurisdiction.
US Persons should note that the Scheme relates to the shares of a UK company
that is a 'foreign private issuer' as defined under Rule 3b-4 under the US
Exchange Act and will be governed by English law. Neither the proxy
solicitation nor the tender offer rules under the US Exchange Act will apply to
the Scheme. Moreover, the Scheme will be subject to the disclosure requirements
and practices applicable in the UK to schemes of arrangement, which differ from
the disclosure requirements of the US proxy solicitation rules and tender offer
rules. Financial information included in this announcement and the Scheme
documentation has been or will have been prepared in accordance with accounting
standards applicable in the UK that may not be comparable to the accounting
standards applicable to financial statements of US companies. If Akzo Nobel
exercises its right to implement the acquisition of the ICI Shares (including in
the form of ICI ADSs) by way of a takeover offer, the offer will be made in
compliance with applicable US tender offer and securities laws and regulations.
This announcement, including information included or incorporated by reference
in this announcement, may contain 'forward-looking statements' concerning Akzo
Nobel and ICI. These statements are based on the current expectations of the
management of ICI and Akzo Nobel and are naturally subject to uncertainty and
changes in circumstances. Generally, the words 'will', 'may', 'should', '
continue', 'believes', 'expects', 'intends', 'anticipates' or similar
expressions identify forward-looking statements. The forward-looking statements
involve risks and uncertainties that could cause actual results to differ
materially from those expressed in the forward-looking statements. Many of
these risks and uncertainties relate to factors that are beyond the companies'
abilities to control or estimate precisely, such as future market conditions and
the behaviour of other market participants, Other unknown or unpredictable
factors could also cause actual results to differ materially from those in the
forward looking statements. Therefore undue reliance should not be placed on
such statements. Akzo Nobel and ICI assume no obligation and do not intend to
update these forward-looking statements, whether as a result of new information,
future events or otherwise, except as required pursuant to applicable law.
Dealing Disclosure Requirements
Under the provisions of Rule 8.3 of the City Code, if any person is, or becomes,
'interested' (directly or indirectly) in one per cent. or more of any class of '
relevant securities' of ICI, all 'dealings' in any 'relevant securities' of ICI
(including by means of an option in respect of, or a derivative referenced to,
any such 'relevant securities') must be publicly disclosed by no later than 3.30
pm (London time) on the London business day following the date of the relevant
transaction. This requirement will continue until the date on which the Scheme
becomes effective or the offer becomes, or is declared, unconditional as to
acceptances, lapses or is otherwise withdrawn or on which the 'offer period'
otherwise ends. If two or more persons act together pursuant to an agreement or
understanding, whether formal or informal, to acquire an 'interest' in 'relevant
securities' of ICI, they will be deemed to be a single person for the purposes
of Rule 8.3 of the City Code.
Under the provisions of Rule 8.1 of the City Code, all 'dealings' in 'relevant
securities' of ICI by ICI or Akzo Nobel, or by any of their respective '
associates', must be disclosed by no later than 12.00 noon (London time) on the
London business day following the date of the relevant transaction.
A disclosure table, giving details of the companies in whose 'relevant
securities' 'dealings' should be disclosed, and the number of such securities in
issue, can be found on the Panel's website at www.thetakeoverpanel.org.uk.
'Interests in securities' arise, in summary, when a person has long economic
exposure, whether conditional or absolute, to changes in the price of
securities. In particular, a person will be treated as having an 'interest' by
virtue of the ownership or control of securities, or by virtue of any option in
respect of, or derivative referenced to, securities.
Terms in quotation marks are defined in the City Code, which can also be found
on the Panel's website. If you are in any doubt as to whether or not you are
required to disclose a 'dealing' under Rule 8 of the City Code, you should
consult the Panel.
APPENDIX I
CONDITIONS AND CERTAIN FURTHER TERMS OF THE TRANSACTION
The Transaction is conditional upon the Scheme becoming unconditional and
becoming effective, subject to the provisions of the City Code, by not later
than 31 March 2008 or such later date (if any) as Akzo Nobel and ICI may agree
and the Panel and the Court may allow, save that Akzo Nobel and ICI have agreed
to extend such date until at least 30 April 2008 (the 'Longstop Date') if it is
reasonably likely on 15 March 2008 that the Transaction can be completed by the
Longstop Date.
Part A: Conditions to the Scheme
1. The Scheme will be subject to the following conditions:
(a) the approval of the Scheme by a majority in number representing
three-fourths or more in value of the holders of the ICI Shares (or the relevant
class or classes thereof) present and voting, either in person or by proxy, at
the Court Meeting and at any separate class meeting which may be required by the
Court (or at any adjournment of any such meeting);
(b) the resolution or resolutions required to approve and implement the
Scheme being duly passed by the requisite majority at the ICI EGM (or at any
adjournment thereof) and not subsequently revoked;
(c) the sanction of the Scheme by the Court (with or without
modification, but subject to any modification being on terms acceptable to Akzo
Nobel acting reasonably), and an office copy of the Scheme Court Order being
filed with the Registrar of Companies in England and Wales; and
(d) the confirmation of the Reduction by the Court (with or without
modification, but subject to any modification being on terms acceptable to Akzo
Nobel acting reasonably), and an office copy of the Reduction Court Order and
minute of such reduction attached thereto being filed with, and registered by,
the Registrar of Companies in England and Wales.
2. The Transaction is conditional upon the passing at the Akzo Nobel
EGM (or at any adjournment thereof) of such resolution or resolutions as are
necessary to approve the Transaction and the acquisition of ICI Shares by Akzo
Nobel.
3. ICI and Akzo Nobel have agreed that, subject as stated in
paragraph 4 below, the necessary actions to make the Scheme effective will not
be taken unless the following conditions (as amended if appropriate) have been
satisfied or waived:
(a) insofar as the Transaction constitutes, or is deemed to
constitute, a concentration with a Community dimension within the scope of the
Regulation:
(i) the European Commission having declared the proposed Transaction
to be compatible with the common market under Article 6(1)(b) or Article 8(2) of
the Regulation, or a decision being deemed to have been taken under Article 10
(6) of the Regulation;
(ii) in the event that any request has been made by one or more
European Union Member States under Article 9(2) of the Regulation and/or one or
more parties to the agreement on the European Economic Area (the 'EEA Agreement
') with regard to Article 6(1) of Protocol 24 of the EEA Agreement:
(A) the European Commission indicating that it does not intend to refer the
proposed acquisition of ICI by Akzo Nobel (or any part thereof) to any competent
authority of any such European Union Member State or party to the EEA Agreement
in accordance with Article 9(3)(b) of the Regulation or Article 6(1) of Protocol
24 of the EEA Agreement, as the case may be; or
(B) in the event that the European Commission refers the proposed
acquisition of ICI by Akzo Nobel (or any part thereof) to the competent
authority of any such European Union Member State or party to the EEA Agreement,
where the national merger control rules require clearance to be obtained before
the proposed acquisition can be consummated, the Relevant Authority having
confirmed in writing, that it does not oppose the proposed acquisition of ICI by
Akzo Nobel (or any part thereof) under the applicable national laws;
(b) all necessary filings having been made under the United States
Hart-Scott-Rodino Antitrust Improvements Act of 1976 (as amended) and the
regulations promulgated thereunder and the applicable waiting periods having
expired, lapsed or been terminated in each case in respect of the Transaction;
(c) an advance ruling certificate shall have been issued in respect of the
Transaction or the applicable waiting period established under the Competition
Act (Canada) shall have expired or been waived or terminated and there shall not
be in effect any temporary restraining order, preliminary or permanent
injunction, statute, rule, regulation, order or decree enacted, entered,
promulgated, issued or enforced by any Relevant Authority which prohibits,
restricts or makes illegal the completion of the Transaction or any stated
intention by any Relevant Authority to seek a temporary restraining order,
preliminary or permanent injunction, order or decree restricting or making
illegal the completion of the Transaction;
(d) approval by the Relevant Authority or all or any relevant waiting
periods having expired, lapsed or been terminated as appropriate in respect of
any mandatory merger control consent which would otherwise have the effect of
making unlawful or otherwise prohibiting the Transaction where it has been
agreed between Akzo Nobel and ICI that a merger control notification should be
made;
(e) since 31 December 2006 and save as fairly disclosed in ICI's annual
report and accounts for the year then ended or as publicly announced by ICI
prior to the date of this announcement (by delivery of an announcement to a
Regulatory Information Service) or as fairly disclosed by or on behalf of ICI to
Akzo Nobel or its advisers prior to the date hereof, there being no provision of
any material agreement, arrangement, licence, permit, lease or other instrument
to which any member of the Wider ICI 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 Transaction or the proposed acquisition of any shares or
other securities in ICI or because of a change in the control or management of
any member of the Wider ICI Group or otherwise, would or might reasonably be
expected to result in, in each case to an extent which is material in the
context of the Wider ICI Group 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 inhibited
or being capable of becoming or being withdrawn or inhibited;
(ii) any such agreement, arrangement, licence, permit, lease or
instrument or the rights, liabilities, obligations or interests of any such
member thereunder being terminated or adversely modified or affected or any
obligation or liability arising or any adverse action being taken or arising
thereunder;
(iii) any assets or interests of, or any asset the use of which is
enjoyed by, 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 or could cease to be available to any such member;
(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 affected;
(vi) the value of, or the financial or trading position or prospects
of, any such member being prejudiced or adversely affected;
(vii) any such member ceasing to be able to carry on business under any
name under which it presently does so;
(viii) the creation of any liability (actual or contingent) by any such
member other than in the ordinary course of business; or
(ix) any liability of any such member to make any severance,
termination, bonus or other payment to any of its five senior executives,
and, except as aforesaid, no event having occurred which, under any provision of
any agreement, arrangement, licence, permit, lease or other instrument to which
any member of the Wider ICI Group is a party would reasonably be expected to
result in any of the events or circumstances as are referred to in
sub-paragraphs (i) to (ix) of this paragraph (e), in any such case, to an extent
which is material in the context of the Wider ICI Group as a whole;
(f) (excluding antitrust or merger control clearances in respect of
the Transaction, in relation to which the Conditions set out in paragraphs 3(a)
to 3(d) (inclusive) above only shall apply) since 31 December 2006 and save as
fairly disclosed in ICI's annual report and accounts for the year then ended or
as publicly announced by ICI prior to the date of this announcement (by delivery
of an announcement to a Regulatory Information Service) or as fairly disclosed
by or on behalf of ICI to Akzo Nobel or its advisers prior to the date hereof,
no government or governmental, quasi-governmental, supranational, statutory,
regulatory, or investigative body, court, trade agency, association, institution
or any other similar 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 having
enacted, made or proposed any statute, regulation, decision or order, or having
taken any other steps which would or might reasonably be expected to, to an
extent that is material in the context of the Wider ICI Group taken as a whole
and/or, in the case of paragraphs (i) and (iii) below, in the context of the
Wider Akzo Nobel Group taken as a whole:
(i) require, prevent or delay the divestiture, or alter the terms
envisaged for any proposed divestiture by any member of the Wider Akzo Nobel
Group or any member of the Wider ICI Group of all or any portion of their
respective businesses, assets or property or 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 material assets or properties (or any part
thereof);
(ii) require, prevent or delay the divestiture by any member of the
Wider Akzo Nobel Group of any shares or other securities in ICI;
(iii) impose any material limitation on, or result in a material delay
in, the ability of any member of the Wider Akzo Nobel 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 ICI 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 ICI Group;
(v) make the Transaction or its implementation or the acquisition or
proposed acquisition by Akzo Nobel or any member of the Wider Akzo Nobel Group
of any shares or other securities in, or control of, ICI void, illegal, and/or
unenforceable under the laws of any jurisdiction, or otherwise directly or
indirectly materially restrain, restrict, prohibit, 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 Akzo Nobel Group or the Wider ICI
Group to acquire or offer to acquire any shares or other securities (or the
equivalent) or interest in any member of the Wider ICI Group or the Wider Akzo
Nobel Group owned by any third party (other than in the implementation of the
Transaction);
(vii) impose any limitation on the ability of any member of the Wider
ICI Group to integrate or 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 ICI 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 Scheme or the acquisition or proposed acquisition
of any ICI Shares having expired, lapsed or been terminated;
(g) (excluding antitrust or merger control clearances in respect of
the Transaction, in relation to which the Conditions set out in paragraphs 3(a)
to (d) (inclusive) above only shall apply) all mandatory notifications, filings
or applications having been made in connection with the Transaction and all
statutory or regulatory obligations in any material jurisdiction having been
complied with in connection with the Transaction or the acquisition by any
member of the Wider Akzo Nobel Group of any shares or other securities in, or
control of, ICI and all mandatory authorisations, orders, recognitions, grants,
consents, licences, confirmations, clearances, permissions and approvals
required by Akzo Nobel or any member of the Wider Akzo Nobel Group for or in
respect of the Transaction or the proposed acquisition of any shares or other
securities in, or control of, ICI by any member of the Wider Akzo Nobel Group
having been obtained in terms and in a form reasonably satisfactory to Akzo
Nobel from all appropriate Third Parties or persons with whom any member of the
Wider ICI Group has entered into contractual arrangements and all such mandatory
authorisations, orders, recognitions, grants, consents, licences, confirmations,
clearances, permissions and approvals necessary to carry on the business of any
member of the Wider ICI Group remaining in full force and effect and all
mandatory filings necessary for such purpose having been made and there being no
notice of any intention to revoke, suspend, restrict or not to renew any of the
same at the time at which the Scheme becomes effective and all mandatory
statutory or regulatory obligations in any jurisdiction having been complied
with;
(h) since 31 December 2006, save as fairly disclosed in ICI's annual
report and accounts for the year then ended or as publicly announced by ICI
prior to the date of this announcement (by delivery of an announcement to a
Regulatory Information Service) or as fairly disclosed by or on behalf of ICI to
Akzo Nobel or its advisers prior to the date hereof, no member of the Wider ICI
Group having, in each case to an extent which is material in the context of the
Wider ICI Group as a whole:
(i) save to other members of the ICI Group or to third parties,
provided that the issue preserves the ICI Group's percentage interest in such
member of the Wider ICI Group as at 31 December 2006 or for ICI Shares issued
pursuant to the exercise of options or the vesting of awards, in each case
granted under the ICI Share Schemes, issued or agreed to issue, or authorised
the issue of additional shares of any class;
(ii) save to other members of the ICI Group or to third parties,
provided, in any such case, that the issue preserves the ICI Group's percentage
interest in such member of the Wider ICI Group as at 31 December 2006 or for the
grant or exercise of options or the grant or vesting of awards under the ICI
Share Schemes, issued or agreed to issue, or 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) other than to another member of the ICI Group or a third party,
provided that the dividend or distribution is pro rata to that party's existing
interest in such member of the Wider ICI Group as at the date of this
announcement recommended, declared, paid or made any bonus, dividend or other
distribution (whether payable in cash or otherwise) save, to the extent
applicable, in relation to the Interim Dividends. For the avoidance of doubt,
this paragraph does not relate to any payments of remuneration to or in respect
of employees;
(iv) other than in the ordinary course of its business, 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 of a
material value or any right, title or interest in any asset of a material value
(including shares and trade investments) or authorised, or announced any
intention to propose any such merger, demerger, acquisition or disposal,
transfer, mortgage, charge or security interest, other than a transaction
between:
(A) members of the ICI Group; or
(B) in the case of a merger, demerger, acquisition,
disposal or transfer of any shares, a member of the ICI Group and a third party,
provided that such transaction preserves the ICI Group's existing interest in
such member of the Wider ICI Group as at the date of this announcement;
(v) save for intra-ICI Group transactions, made, authorised or
announced an intention to propose any change in its loan capital;
(vi) issued or authorised the issue of any debentures or, other than in
the ordinary course of its business, incurred or increased any indebtedness or
become subject to any contingent liability, in each case other than as between
members of the ICI Group.
(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 or scheme otherwise than in the
ordinary course of its business, in each case other than as:
(A) members of the ICI Group; or
(B) a member of the ICI Group and a third party,
provided that such transaction preserves the ICI Group's existing interest in
such member of the Wider ICI Group as of the date of this announcement;
(ix) entered into or changed the terms of any contract with any
director or senior executive of ICI, otherwise than in the ordinary course of
its business;
(x) entered into or varied or authorised, or announced its intention
to enter into or vary any contract, transaction, arrangement or commitment
(whether in respect of capital expenditure or otherwise) which is of a long
term, onerous or unusual nature or magnitude or which is or could reasonably be
expected to be materially restrictive on the businesses of any member of the
Wider ICI Group or the Wider Akzo Nobel Group (other than to a nature and extent
which is normal in the context of the business concerned) or which involves or
could reasonably be expected to involve an obligation of such a nature or
magnitude or which is other than in the ordinary course of its business and
which is material in the context of the Wider ICI Group or the Wider Akzo Nobel
Group taken as a whole;
(xi) proposed, agreed to provide or modified the terms of any share
option scheme or incentive scheme or, other than in the ordinary course of its
business, materially altered any other benefit relating to the employment or
termination of employment of any employee of the Wider ICI Group, otherwise than
as agreed in writing between Akzo Nobel and ICI;
(xii) made or agreed or consented to any change to:
(A) the terms of the trust deeds constituting the pension scheme(s)
established by any member of the Wider ICI Group for its directors, employees or
their dependents;
(B) the contributions payable to any such scheme(s) or to the benefits
which accrue or to the pensions which are payable thereunder;
(C) the basis on which qualification for, or accrual or entitlement to,
such benefits or pensions are calculated or determined; or
(D) the basis upon which the liabilities (including pensions) of such
pension schemes are funded or valued;
(xiii) other than in respect of any body corporate which is dormant and
was solvent at the relevant time, taken or proposed any corporate action or had
any legal proceedings instituted 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
material part of its assets or revenues or any analogous proceedings in any
jurisdiction or had any such person appointed;
(xiv) been unable, or admitted in writing that it is unable, to pay its
debts or commenced negotiations with one or more of its creditors with a view to
rescheduling or restructuring any of its indebtedness, or having stopped or
suspended (or threatened to stop or suspend) payment of its debts generally or
ceased or threatened to cease carrying on all or a substantial part of its
business;
(xv) waived or compromised any claim otherwise than in the ordinary
course of its business and of an amount which is immaterial in the context of
the business of the Wider ICI Group taken as a whole;
(xvi) made any material alteration to its memorandum or articles of
association or other incorporation documents; or
(xvii) 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 sub-paragraphs (iii), (iv), (v), (vi) and (viii) of
this condition, the term 'ICI Group' shall mean ICI and its wholly-owned
subsidiaries;
(i) since 31 December 2006 and save as fairly disclosed in the
accounts of ICI for the year then ended and save as publicly announced to a
Regulatory Information Service by or on behalf of ICI prior to the date hereof
and save as fairly disclosed by or on behalf of ICI to Akzo Nobel or its
advisers prior to the date hereof:
(i) no adverse change or deterioration having occurred in the
business, assets, financial or trading position or profits or prospects or
operational performance of any member of the Wider ICI Group which in any case
is material in the context of the Wider ICI Group taken as a whole;
(ii) so far as ICI is aware no litigation, arbitration proceedings,
prosecution or other legal proceedings to which any member of the Wider ICI
Group is or may become a party (whether as a claimant, defendant or otherwise)
and (other than as a result of the Transaction) no enquiry or investigation by,
or complaint or reference to, any Third Party against or in respect of any
member of the Wider ICI Group having been instituted, announced or threatened by
or against or remaining outstanding in respect of any member of the Wider ICI
Group which in any such case might reasonably be expected to adversely and
materially affect any member of the Wider ICI Group;
(iii) no contingent or other liability in respect of any member of the
Wider ICI Group having arisen or become apparent to ICI which is material in the
context of the Wider ICI Group taken as a whole; and
(iv) no steps having been taken which are reasonably likely to result
in the withdrawal, cancellation, termination or modification of any licence or
authorisation held by any member of the Wider ICI Group which is material in the
context of the Wider ICI Group taken as a whole;
(j) since 31 December 2006 and save as fairly disclosed in ICI's
annual report and accounts for the year then ended or as publicly announced by
ICI prior to the date of this announcement (by delivery of an announcement to a
Regulatory Information Service) or as fairly disclosed by or on behalf of ICI to
Akzo Nobel or its advisers prior to the date hereof, Akzo Nobel not having
discovered:
(i) that any financial, business or other information concerning the
Wider ICI Group as contained in the information publicly disclosed at any time
by or on behalf of any member of the Wider ICI Group is materially misleading,
contains a material misrepresentation of fact or omits to state a material fact
necessary to make that information not misleading, to an extent which, in any
such case, is material in the context of the ICI Group taken as a whole, and
which was not subsequently corrected before the date of this announcement by
disclosure either by delivery of an announcement to a Regulatory Information
Service, or otherwise by fair disclosure to Akzo Nobel; or
(ii) that any member of the Wider ICI Group or any partnership,
company or other entity in which any member of the Wider ICI Group has a
significant economic interest and which is not a subsidiary undertaking of ICI
is subject to any material liability (contingent or otherwise) which is not
disclosed in the annual report and accounts of ICI for the year ended 31
December 2006; or
(iii) any information which affects the import of any information
disclosed at any time by or on behalf of any member of the Wider ICI Group and
which is material in the context of the Wider ICI Group taken as a whole; and
(k) save as fairly disclosed in ICI's annual report for the year ended
31 December 2006 or provided for in the accounts of ICI for the year ended 31
December 2006 and save as publicly announced to a Regulatory Information Service
by or on behalf of ICI prior to the date hereof and save as fairly disclosed by
or on behalf of ICI to Akzo Nobel or its advisers prior to the date hereof, Akzo
Nobel not having discovered that:
(i) any past or present member of the Wider ICI 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 health or animal health or otherwise relating to
environmental matters, or that there has otherwise been any such disposal,
spillage, release, discharge, leak or emission (whether or not the same
constituted a non-compliance by any person with any such legislation or
regulations, and wherever the same may have taken place) any of which disposal,
spillage, release, discharge, leak or emission would be reasonably likely to
give rise to any liability (actual or contingent) on the part of any member of
the Wider ICI Group which is material in the context of the Wider ICI Group
taken as a whole;
(ii) there is, or is likely to be, for that or any other reason
whatsoever, any liability (actual or contingent) of any past or present member
of the Wider ICI Group to make good, repair, reinstate or clean up any property
or any controlled waters now or previously owned, occupied, operated or made use
of or controlled by any such past or present member of the Wider ICI Group,
under any environmental legislation, regulation, notice, circular or order of
any government, governmental, quasi-governmental, state or local government,
supranational, statutory or other regulatory body, agency, court, association or
any other similar person or body in any jurisdiction which is material in the
context of the Wider ICI Group taken as a whole; or
(iii) circumstances exist whereby a person or class of persons would be
reasonably likely to have a claim or claims in respect of any product or process
of manufacture or materials used therein now or previously manufactured, sold or
carried out by any past or present member of the Wider ICI Group, which claim or
claims would be reasonably likely to have an adverse affect on any member of the
Wider ICI Group which is material in the context of the Wider ICI Group taken as
a whole.
4. Subject to the requirements of the Panel, Akzo Nobel reserves the
right to waive, in whole or in part, all or any of the above conditions, except
Condition 1. Akzo Nobel reserves the right to elect (with the consent of the
Panel, where necessary) to implement the acquisition of the entire issued and to
be issued share capital of ICI by way of a takeover offer (as such term is
defined in Part 28 of the Companies Act 2006). In such event, such offer will
be implemented on the same terms, so far as applicable, as those which would
apply to the Scheme, subject to appropriate amendments to reflect the change in
method of effecting the Transaction, including (without limitation and subject
to the consent of the Panel) an acceptance condition set at 90 per cent. (or
such lesser percentage, being more than 50 per cent., as Akzo Nobel may decide)
of: (i) the shares to which such offer relates; and (ii) the voting rights
normally exercisable at a general meeting of ICI, including, for this purpose,
any such voting rights attaching to ICI Shares that are unconditionally allotted
or issued before the takeover offer becomes or is declared unconditional as to
acceptances, whether pursuant to the exercise of any outstanding subscription or
conversion rights or otherwise.
5. If Akzo Nobel is required by the Panel to make an offer for ICI
Shares under the provisions of Rule 9 of the City Code, Akzo Nobel may make such
alterations to any of the above conditions as are necessary to comply with the
provisions of that Rule.
6. Save with the consent of the Panel, the Scheme will not proceed
if the European Commission initiates proceedings under Article 6(1)(c) of the
Regulation or the Transaction is referred to the Competition Commission in the
United Kingdom, in either case before the date on which the resolutions are
passed at the Court Meeting (or, in the case of a takeover offer under paragraph
4 above, before 1.00 p.m. on the first closing date of the takeover offer or the
date on which the takeover offer becomes or is declared unconditional as to
acceptances, whichever is the later).
7. The Transaction may be effected by one or more Subsidiaries of
Akzo Nobel in addition to or in place of Akzo Nobel. Details of any such
Subsidiaries will be included in the Scheme Document. References to Akzo Nobel
in this announcement should be construed accordingly.
8. The Scheme will be governed by English law and be subject to the
jurisdiction of the English courts, to the conditions set out above and the
further terms set out below and to be set out in the Scheme Document and the
Form of Proxy. The Scheme will comply with the applicable rules and regulations
of the FSA, the London Stock Exchange and the City Code.
Part B: Certain further terms of the Transaction
The ICI Shares will be acquired pursuant to the Transaction fully paid and free
from all liens, charges, equitable interests, encumbrances, rights of
pre-emption and any other rights and interests of any nature whatsoever and
together with all rights now and hereafter attaching thereto, including voting
rights and the right to receive and retain in full all dividends and other
distributions (if any) declared, made or paid on or after the date hereof other
than the Interim Dividends.
APPENDIX II
BASES AND SOURCES OF INFORMATION
In this announcement:
(a) An exchange rate of €1.478 to £1 has been used, being the €/£
exchange rate as at close of business on 10 August 2007. Sourced from Bloomberg.
(b) Unless otherwise stated, financial information concerning Akzo
Nobel has been extracted from the annual report and accounts of Akzo Nobel for
the year ended 31 December 2006 and from the announcement of Akzo Nobel's second
quarter and half year results for the period ended 30 June 2007.
(c) Unless otherwise stated, financial information concerning ICI has
been extracted from the annual report and accounts of ICI for the year ended 31
December 2006 and from the announcement of ICI's second quarter and half year
results for the period ended 30 June 2007.
(d) The value of the issued share capital of ICI is based upon
1,195,385,083 ICI Shares. ICI announced on 8 August 2007 that, for the purposes
of Rule 2.10 of the City Code, there were 1,195,385,083 ICI Shares in issue, the
ISIN number for which is GB0004594973.
(e) The market prices of ICI Shares are closing, middle-market
quotations derived from the Daily Official List.
(f) The average Closing Price of ICI Shares over the six months ended
15 June 2007 is derived from data provided by Bloomberg.
(g) The estimated operating cost savings and synergies have been
calculated on the basis of the existing cost and operating structures of the
Akzo Nobel Group and the ICI Group. Such estimates are, by their nature,
subject to uncertainty and changes in circumstances.
APPENDIX III
DETAILS OF IRREVOCABLE UNDERTAKINGS
The directors of ICI have given irrevocable undertakings to vote in favour of
the Scheme and the resolutions at the Court Meeting and the ICI EGM in relation
to the following ICI Shares:
Name Number of ICI Shares % of Issued Share Capital
Adri Baan 18,000 0.0015
Alan Brown 1,305 0.0001
Lord Butler 1,636 0.0001
Peter Ellwood 56,154 0.0047
Joseph Gorman 14,624 0.0012
David Hamill 96,542 0.0081
Rick Haythornthwaite 12,791 0.0011
John McAdam 439,459 0.0368
Baroness Noakes 13,600 0.0011
Total 654,111 0.0547
APPENDIX IV
DEFINITIONS
The following definitions apply throughout this announcement unless the context
otherwise requires:
'Akzo Nobel' Akzo Nobel N.V.
'Akzo Nobel Documentation' the notice of the Akzo Nobel EGM and the information package to be
prepared by Akzo Nobel and made available to Akzo Nobel shareholders in
respect of the Akzo Nobel EGM
'Akzo Nobel EGM' the general meeting of Akzo Nobel Shareholders (including any
adjournment thereof) to be convened in connection with the Transaction
and the related On-Sale
'Akzo Nobel Group' Akzo Nobel, its Subsidiaries and Subsidiary Undertakings
'Associated Undertaking' has the meaning given in Schedule 4A of the Companies Act 1985
'Australia' the Commonwealth of Australia, its states, territories and possessions
and all areas subject to its jurisdiction or any sub-division thereof
'Business Day' a day (other than a Saturday or a Sunday) on which banks in London are
open for business (other than solely for trading and settlement in euro)
'Canada' Canada, its provinces, territories and all areas subject to its
jurisdiction and any political sub-division thereof
'City Code' the City Code on Takeovers and Mergers issued by the Panel from time to
time
'Closing Price' the closing middle market quotation
'Conditions' the conditions to the implementation of the Transaction (including the
Scheme), which are set out in Appendix I of this announcement
'Court Meeting' the meeting (and any adjournment thereof) of holders of Scheme Shares
convened by order of the Court under section 425 of the Companies Act
1985 to consider and vote on the Scheme
'Court Orders' the Scheme Court Order and/or the Reduction Court Order, as the case may
be
'Court' the High Court of Justice in England and Wales
'CREST' the relevant system in respect of which Euroclear UK & Ireland Limited
is the Operator (each as defined in the Regulations)
'Deposit Agreement' the amended and restated deposit agreement dated 15 June 2004, as
amended, between ICI and the Depositary
'Depositary' Citibank, N.A.
'Effective Date' the day on which the Scheme becomes effective in accordance with its
terms
'Excluded Shares' any ICI Shares beneficially owned by any ICI employee trust or any
member of the Akzo Nobel Group or any ICI Shares held in treasury by ICI
'Forms of Proxy' the forms of proxy for use by ICI Shareholders at the ICI EGM and the
Court Meeting
'FSA' Financial Services Authority
'Henkel' Henkel KGaA
'HSR Act' means the United States Hart-Scott-Rodino Antitrust Improvements Act of
1976 (as amended)
'ICI' Imperial Chemical Industries PLC
'ICI ADS' an American Depositary Share representing four ICI Shares
'ICI ADS Holders' the holders of ADSs, from time to time
'ICI Board' the board of directors of ICI;
'ICI EGM' the extraordinary general meeting of ICI Shareholders (including any
adjournment thereof) to be convened in connection with the Transaction
'ICI Group' ICI, its Subsidiaries and Subsidiary Undertakings
'ICI Shareholders' or ' holders of ICI Shares
Shareholders'
'ICI Shares' ordinary shares of £1 each in the capital of ICI, including those
represented by ICI ADSs
'ICI Share Schemes' the 2004 Executive Share Option Plan, the 1994 Senior Staff Share Option
Scheme, the UK Sharesave Scheme, the Performance Growth Plan 2007, the
Performance Growth Plan 2004, the Performance Growth Plan 2000, the
Performance Share Plan and the Restricted Share Plan, in each case, of
ICI
'Implementation Agreement' the implementation agreement between ICI and Akzo Nobel dated 13 August
2007
'Interim Dividends' the interim dividends of:
(a) 4.95 pence per ICI Share declared by the directors of ICI
on 2 August 2007, which is expected to be paid on 5 October 2007 to ICI
Shareholders on the register of members on 24 August 2007; and
(b) 5.00 pence per ICI Share in respect of the period 1 July
2007 to 31 December 2007, provided that if the Effective Date falls
prior to 31 December 2007, such dividend will be paid pro rata by
reference to where the Effective Date falls between 1 July 2007 and 31
December 2007
'Japan' Japan, its cities, prefectures, territories and possessions and all
areas subject to its jurisdiction or any sub-division thereof
'Listing Rules' the listing rules made by the FSA under section 73A of the Financial
Services and Markets Act 2000, as amended from time to time
'Loan Note Alternative' the alternative whereby ICI Shareholders (other than Restricted Overseas
Persons) may elect, subject to certain limitations and conditions, to
receive Loan Notes instead of some or all of the cash consideration to
which they would otherwise be entitled under the Transaction
'Loan Note Elected Shares' Scheme Shares (if any) in respect of which valid elections have been
made under the Loan Note Alternative in accordance with its terms
'Loan Notes' the loan notes to be issued by Akzo Nobel or a wholly owned subsidiary
of it pursuant to the Loan Note Alternative
'London Stock Exchange' London Stock Exchange plc
'Meetings' the Court Meetings and the ICI EGM
'Merrill Lynch' Merrill Lynch International
'Morgan Stanley' Morgan Stanley & Co. Limited
'Non-Solicitation Agreement' the non-solicitation agreement between ICI and Akzo Nobel dated 13
August 2007
'On-Sale' the on-sale of the Adhesives Division and the Electronic Materials
Division to Henkel pursuant to the On-Sale Agreement
'On-Sale Agreement' the agreement between Akzo Nobel and Henkel to sell all assets and
liabilities comprising the business divisions known within the ICI Group
as the Adhesives Division and the Electronic Materials Division, both of
which form part of the National Starch business of ICI, following
completion of the Transaction
'Organon BioSciences' Organon BioSciences N.V.
'Panel' the Panel on Takeovers and Mergers
'Reduction' the proposed reduction of capital under section 137 of the Companies Act
1985 provided for by the Scheme
'Reduction Court Hearing' the hearing by the Court of the petition to confirm the Reduction
'Reduction Court Order' the order of the Court, granted at the Reduction Court Hearing,
confirming the Reduction
'Regulation' means Council Regulation (EC) 139/2004 (as amended)
'Regulations' the Uncertificated Securities Regulations 2001
'Regulatory Information Service' any information services authorised from time to time by the FSA for the
purpose of disseminating regulatory announcements
'Relevant Authority' means any central bank, ministry, governmental, quasi-governmental
(including the European Union), supranational, statutory, regulatory or
investigative body or authority (including any national or supranational
antitrust or merger control authority), national, state, municipal or
local government (including any subdivision, court, administrative
agency or commission or other authority thereof), private body
exercising any regulatory, taxing, importing or other authority, trade
agency, association, institution or professional or environmental body
or any other person or body whatsoever in any relevant jurisdiction;
'Restricted Overseas Person' (a) any US Person;
(b) any ICI ADS Holder;
(c) any person (including an individual, partnership,
unincorporated syndicate, limited liability company, unincorporated
organisation, trust, trustee, executor, administrator or other legal
representative) in or resident in, or any person whom Akzo Nobel
believes to be in or resident in, Australia or Japan (or any custodian,
nominee or trustee for such person); and
(d) any person in any other jurisdiction (other than persons in
the UK) whom Akzo Nobel is advised to treat as a restricted overseas
person in order to observe the laws of such jurisdiction or to avoid the
requirement to comply with any governmental or other consent or any
registration, filing or other formality which Akzo Nobel regards as
unduly onerous
'Scheme' the scheme of arrangement under section 425 of the Companies Act 1985 to
be proposed by ICI to the ICI Shareholders in connection with the
Transaction, with or subject to any modification, addition or condition
approved or imposed by the Court and agreed by ICI and Akzo Nobel
'Scheme Court Hearing' the hearing by the Court of the petition to sanction the Scheme
'Scheme Court Order' the order of the Court, granted at the Scheme Court Hearing, sanctioning
the Scheme under section 425 of the Companies Act 1985
'Scheme Document' the document to be addressed to, among others, ICI Shareholders
containing, among other things, the Scheme, and the notices of the
Meetings
'Scheme Shareholders' holders of Scheme Shares
'Scheme Shares' the ICI Shares:
(a) in issue at the date of the Scheme;
(b) (if any) issued after the date of the Scheme and prior to
the voting record time in respect of the Court Meeting; and
(c) (if any) issued on or after the voting record time in
respect of the Court Meeting and at or prior to the record time for the
Reduction in respect of which the original or any subsequent holders
thereof are bound by the Scheme or in respect of which the holder
thereof shall have agreed in writing to be bound by the Scheme,
in each case other than the Excluded Shares (if any)
'Special Resolution' the special resolution to approve, among other things, the cancellation
of the entire issued share capital of ICI (other than the Loan Note
Elected Shares), the alteration of ICI's articles of association and
such other matters as may be necessary to implement the Scheme and the
delisting of ICI Shares
'Subsidiary' has the meaning given in section 736 of the Companies Act 1985
'Subsidiary Undertaking' has the meaning given in section 258 of the Companies Act 1985
'Transaction' the proposed acquisition of the ICI Shares by Akzo Nobel to be effected
by means of the Scheme (or, should Akzo Nobel so elect, by means of a
takeover offer)
'UBS' or 'UBS Investment Bank' UBS Limited
'UK' or 'United Kingdom' the United Kingdom of Great Britain and Northern Ireland
'US' or 'United States' The United States of America, its territories and possessions, any state
or political subdivision of the United States of America and the
District of Columbia
'US Exchange Act' the US Securities Exchange Act of 1934, as amended
'US Person' a US person, as defined in Regulation S under the US Securities Act or a
person resident in the US
'US Securities Act' the US Securities Act of 1933, as amended
'Wider ICI Group' the ICI Group and Associated Undertakings of ICI and any other body
corporate, partnership, joint venture or person in which ICI and such
undertakings (aggregating their interests) have a direct or indirect
interest of 10 per cent. or more of the voting or equity capital or the
equivalent
'Wider Akzo Nobel Group' the Akzo Nobel Group and Associated Undertakings of Akzo Nobel and any
other body corporate, partnership, joint venture or person in which Akzo
Nobel and such undertakings (aggregating their interests) have a direct
or indirect interest of 10 per cent. or more of the voting or equity
capital or the equivalent
'£' or 'Sterling' pounds Sterling, or the lawful currency of the UK from time to time
'$' or 'US Dollars' the lawful currency of the US from time to time
'€' or 'Euro' the lawful currency of the member states of the European Union
that adopt the single currency in accordance with the EC Treaty
All references to time in this announcement are to London time unless otherwise
stated.
CD072240044
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