Recommended All-Share Merger
NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION IN WHOLE OR IN PART, IN, INTO OR FROM ANY JURISDICTION WHERE TO DO SO WOULD CONSTITUTE A VIOLATION OF THE RELEVANT LAWS OF SUCH JURISDICTION
9 November 2012
FOR IMMEDIATE RELEASE
RECOMMENDED ALL-SHARE MERGER OF
LONDON & STAMFORD PROPERTY PLC ("LONDON & STAMFORD")
and
METRIC PROPERTY INVESTMENTS PLC ("METRIC")
to be effected by means of a Scheme of Arrangement
under Part 26 of the Companies Act 2006
Summary
· The boards of directors of London & Stamford and Metric are pleased to announce that they have reached agreement on the terms of a recommended merger pursuant to which London & Stamford will acquire the entire issued and to be issued ordinary share capital of Metric. The Merger is to be effected by means of a scheme of arrangement under Part 26 of the Companies Act.
· Under the terms of the Merger, Metric Shareholders will be entitled to receive:
0.94 New Ordinary Shares for each Metric Ordinary Share,
resulting in Metric Shareholders owning 25 per cent. and London & Stamford Shareholders owning 75 per cent. of the Enlarged Share Capital.
· On the basis of the Closing Price per Ordinary Share of 117 pence on 5 November 2012, the Merger values each Metric Ordinary Share at 110 pence and the entire issued and to be issued share capital of Metric at approximately £209.0 million.
· The Merger represents a premium of approximately:
· 18 per cent. to the Closing Price per Metric Ordinary Share of 93 pence on 5November 2012 (being the last Business Day prior to the commencement of the Offer Period); and
· 24 per cent. to the six-month average price per Metric Ordinary Share of 89 pence (being the average Closing Price for the six-month period ended on 5 November 2012, being the last Business Day prior to the commencement of the Offer Period).
· London & Stamford is also announcing its intention, following completion of the Merger, to undertake a return of capital of £100 million to shareholders of the Enlarged Company. The proposed Tender Offer, to the extent taken up, would deliver a more efficient capital structure, whilst leaving sufficient resources for the Enlarged Group to execute its business plan. Eligible Shareholders will be invited to tender, in aggregate, up to 88,573,959 Ordinary Shares, representing approximately 12 per cent. of the Enlarged Share Capital, at a price not less than 112.9 pence per share which equates to pro forma EPRA NAV of the Enlarged Group, as at 30 September 2012 (excluding goodwill arising upon the Merger). Full details of the Tender Offer, including the price per share at which tendered shares will be purchased, will be sent to Eligible Shareholders following completion of the Merger. If the Tender Offer is not taken up in full, the Enlarged Company will keep those funds for reinvestment and continue to review the appropriate balance sheet structure, relative to the opportunities within the property market.
· Upon completion of the Merger, the Enlarged Group will benefit from:
o being a top ten UK REIT with a liquid listing;
o greater deal flow in wider markets with significant capacity to invest, enhanced by strong joint venture relationships;
o broader access to capital and new debt markets;
o a market leading management team with an excellent cultural fit;
o a UK business strategy focused on:
§ commercial/residential property in the London economic area;
§ out of town retail investment and selected development; and
§ opportunistic acquisitions with strong cash flows;
o an intensive approach to asset management;
o a focus on income and growth to support a sustainable dividend;
o firm disciplines in acquiring and recycling assets; and
o a balanced board of directors supported by an experienced Executive Committee.
· Following completion of the Merger, the board of directors of the Enlarged Group will be drawn from the boards of directors of both companies and will include (a) Patrick Vaughan, Chief Executive of London & Stamford, as Executive Chairman, (b) Andrew Jones, Chief Executive of Metric, as Chief Executive and (c) Martin McGann, Finance Director of London & Stamford, as Finance Director. Sue Ford has informed the Metric Board that she intends to retire from her role as Finance Director following completion of the Merger. In addition, the Enlarged Group's board of directors will comprise eight non-executive directors drawn equally from London & Stamford and Metric's existing non-executive directors. Raymond Mould and Richard Crowder have advised the London & Stamford Board that they intend to retire from their respective roles as Chairman and non-executive director of London & Stamford following completion of the Merger.
· The Metric Directors, who have been so advised by J.P. Morgan Cazenove, consider the terms of the Merger to be fair and reasonable. In providing advice to the Metric Directors, J.P. Morgan Cazenove has taken into account the commercial assessments of the Metric Directors.
· Accordingly, the Metric Directors intend unanimously to recommend that Metric Shareholders vote in favour of the Scheme at the Metric Court Meeting and vote in favour of the Metric Resolution to be proposed at the Metric General Meeting as they have irrevocably undertaken to do in respect of their own beneficial holdings of 6,101,914 Metric Ordinary Shares representing, in aggregate, approximately 3.2 per cent. of the ordinary share capital of Metric in issue on 8 November 2012 (being the latest practicable date prior to this announcement).
· The Scheme is conditional on, among other things, certain approvals by London & Stamford Shareholders and Metric Shareholders and the sanction of the Scheme by the Court. In order to become effective, the Scheme must be approved by a majority in number of Metric Shareholders voting at the Metric Court Meeting, representing not less than 75 per cent. in value of the Metric Shares that are voted. It is expected that the Scheme Document will be posted as soon as is reasonably practicable and in any event within 28 days of this announcement, and that, subject to the satisfaction, or where relevant waiver, of all relevant conditions, the Scheme will become effective by the end of January 2013 and the Proposals completed by the end of February 2013.
· The London & Stamford Directors intend to recommend that London & Stamford Shareholders vote in favour of the resolutions to be proposed at the London & Stamford General Meeting, as they have irrevocably undertaken to do in respect of their own beneficial holdings, to the extent that they are permitted to vote on such resolutions. The London & Stamford Directors have therefore undertaken to vote in favour of the resolutions to be proposed at the London & Stamford General Meeting in respect of 40,212,932 Ordinary Shares in aggregate (save for the proposed resolution in relation to the Existing Management Incentive Agreement, where their undertakings are in respect of 100,000 Ordinary Shares in aggregate).
· Further details of these irrevocable undertakings are set out in Appendix 3 to this announcement.
· The Metric Directors and the London & Stamford Directors have undertaken, if the Merger becomes Effective, not to accept the Tender Offer in respect of any of their own beneficial holdings of Ordinary Shares, representing, in aggregate, 6 per cent. of the Enlarged Issued Share Capital, save to the extent required to pay liabilities incurred as a result of exercise of options triggered by the Merger or other tax liabilities.
· London & Stamford is a UK focused real estate investment trust. London & Stamfordinvests in residential and commercial property, including office and distribution real estate assets, all of which are located in the UK. As at 5 November 2012 (being the last practicable date prior to the commencement of the Offer Period), London & Stamford had a market capitalisation of £635.1 million and, as at 30 September 2012, had Net Assets of £609.8 million and an EPRA NAV of 114 pence per Ordinary Share.
· Metric is a UK retail focused real estate investment trust. Metric was established to assemble a portfolio of freehold and long leasehold retail properties throughout the UK and Ireland. As at 5 November 2012 (being the last practicable date prior to the commencement of the Offer Period), Metric had a market capitalisation of £176.7 million and, as at 30 September 2012, had net assets of £200.1 million and an EPRA NAV of 107 pence per share.
· Following completion of the Merger, London & Stamfordand Metric intend to merge their operations into a single unified business, under a unified board structure and senior management team. London & Stamford and Metric have conducted a general review of the operations, assets and employees of the other and this has led to the identification of potential synergies resulting from the Merger, based on the centralisation of London & Stamford's and Metric's operating functions, which is expected to yield annual cost savings.
· Following completion of the Merger, the Enlarged Group will have gross property assets (including its shares in joint ventures) of £993 million (based on 30 September 2012 property valuations). Upon completion of the Merger and assuming the Tender Offer is taken up in full (at 112.9 pence per share for illustrative purposes), the pro forma net asset value of the Enlarged Group, as at 30 September 2012, is £711 million. The Pro Forma EPRA NAV per share is 114.3 pence.
· It is intended that, following completion of the Merger, the Enlarged Company will operate under a new name, LondonMetric Property Plc, will remain listed on the London Stock Exchange and have a new ticker, LMP.L. on the London Stock Exchange.
· Commenting on the Merger, Raymond Mould, Chairman of London & Stamford, said:
"This transaction merges two terrific companies both with well let property portfolios and reunites a highly experienced management team that has the proven ability to identify and crystallise value through opportunistic transactions. A combination of London & Stamford and Metric has the potential to create significant shareholder value for all parties and brings considerable benefits for both sets of shareholders. I am delighted to have this opportunity to hand over the keys of an excellent real estate portfolio to an experienced and well trusted team, chaired by Patrick Vaughan who has been my business partner and friend for over 40 years, and have no doubt that they will build upon the considerable success that has been achieved to date."
· Commenting on the Merger, Andrew Jones, Chief Executive of Metric, said:
"The proposed merger will create a larger REIT with scale, diversity and liquidity and brings together deep real estate knowledge, financial resources and management skills. Organisations across the world are deleveraging and we believe that this will continue to bring attractively priced assets to the market. We are excited by the prospect of being strongly positioned, with London & Stamford, to exploit these opportunities as they arise across the market."
This summary should be read in conjunction with, and is subject to, the full text of the following announcement and the Appendices.
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Credit Suisse, which is authorised and regulated in the United Kingdom by the Financial Services Authority, is acting exclusively for London & Stamford and no one else in connection with the Proposals and will not be responsible to anyone other than London & Stamford for providing the protections afforded to clients of Credit Suisse or for providing advice in connection with the Proposals, the content of this announcement or any matter or arrangement referred to herein. Neither Credit Suisse nor any of its subsidiaries, branches or affiliates, owes or accepts any duty, liability or responsibility whatsoever (whether direct or indirect, whether in contract, in tort, under statute or otherwise) to any person who is not a client of Credit Suisse in connection with this announcement, any statement contained herein or otherwise.
Peel Hunt, which is authorised and regulated in the United Kingdom by the Financial Services Authority, is acting exclusively for London & Stamford and no one else in connection with the Proposals and will not be responsible to anyone other than London & Stamford for providing the protections afforded to clients of Peel Hunt or for providing advice in connection with the Proposals, the content of this announcement or any matter or arrangement referred to herein. Neither Peel Hunt nor any of its subsidiaries, branches or affiliates, owes or accepts any duty, liability or responsibility whatsoever (whether direct or indirect, whether in contract, in tort, under statute or otherwise) to any person who is not a client of Peel Hunt in connection with this announcement, any statement contained herein or otherwise.
J.P. Morgan Limited, which conducts its UK investment banking business as J.P. Morgan Cazenove, which is authorised and regulated in the United Kingdom by the Financial Services Authority, is acting exclusively for Metric and no one else in connection with the Merger, and will not be responsible to anyone other than Metric for providing the protections afforded to clients of J.P. Morgan Cazenove or for providing advice in connection with the Merger or any matter or arrangement referred to herein. Neither J.P Morgan Cazenove nor any of its subsidiaries, branches or affiliates, owes or accepts any duty, liability or responsibility whatsoever (whether direct or indirect, whether in contract, in tort, under statute or otherwise) to any person who is not a client of J.P Morgan Cazenove in connection with this announcement, any statement contained herein or otherwise.
Oriel Securities, which is authorised and regulated in the United Kingdom by the Financial Services Authority, is acting exclusively for Metric and no one else in connection with the Merger, and will not be responsible to anyone other than Metric for providing the protections afforded to clients of Oriel Securities or for providing advice in connection with the Merger or any matter or arrangement referred to herein. Neither Oriel Securities nor any of its subsidiaries, branches or affiliates, owes or accepts any duty, liability or responsibility whatsoever (whether direct or indirect, whether in contract, in tort, under statute or otherwise) to any person who is not a client of Oriel Securities in connection with this announcement, any statement contained herein or otherwise.
This announcement is for information purposes only and is not intended to and does not constitute or form part of an offer to sell or subscribe for or any invitation to purchase or subscribe for any securities or the solicitation of an offer to buy any securities, pursuant to the Merger or otherwise. The Merger will be made solely by means of the Scheme Document which will contain the full terms and conditions of the Merger, including details of how to vote in respect of the Scheme.
Any approval, decision or other response to the Merger should be made only on the basis of the information in the Scheme Document and Combined Circular and Prospectus. Metric Shareholders are strongly advised to read the formal documentation in relation to the Merger once it has been despatched. It is expected that the Scheme Document (including notices of the Metric Shareholder Meetings) together with the relevant Forms of Proxy and Combined Circular and Prospectus, will be posted to Metric Shareholders as soon as is reasonably practicable and in any event within 28 days of this announcement, unless otherwise agreed with the Panel.
Metric will prepare the Scheme Document to be distributed to Metric Shareholders. Metric and London & Stamford urge Metric Shareholders to read the Scheme Document and Combined Circular and Prospectus when they become available because they will contain important information relating to the Merger.
Any approval, decision or other response to the Proposals should be made only on the basis of the information in the Combined Circular and Prospectus. London & Stamford Shareholders are strongly advised to read the formal documentation in relation to the Merger once it has been despatched. It is expected that the Combined Circular and Prospectus (including the notice of the London & Stamford General Meeting) together with the relevant form of proxy, will be posted to London & Stamford Shareholders as soon as is reasonably practicable and in any event within 28 days of this announcement, unless otherwise agreed with the Panel.
London & Stamford will prepare the Combined Circular and Prospectus to be distributed to London & Stamford Shareholders. London & Stamford urges London & Stamford Shareholders to read the Combined Circular and Prospectus when it becomes available because it will contain important information relating to the Proposals.
The statements contained in this announcement are made as at the date of this announcement, unless some other time is specified in relation to them. Nothing contained in this announcement shall be deemed to be a forecast, projection or estimate of the future financial performance of Metric or the Metric Group or London & Stamford or the London & Stamford Group except where otherwise stated.
Overseas shareholders
The release, publication or distribution of this announcement in certain jurisdictions may be restricted by law. Persons who are not resident in the United Kingdom or who are subject to the laws of any jurisdiction other than the United Kingdom should inform themselves of, and observe, any applicable requirements. Any failure to comply with the restrictions may constitute a violation of the securities laws of any such jurisdiction. This announcement does not constitute an offer or an invitation to purchase or subscribe for any securities or a solicitation of an offer to buy any securities pursuant to this announcement or otherwise in any jurisdiction in which such offer or solicitation is unlawful. This announcement has been prepared for the purposes of complying with the laws of England and Wales 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 any jurisdiction outside England and Wales.
The Merger relates to shares of two UK companies and is proposed to be effected by means of a scheme of arrangement under the laws of England and Wales. Accordingly, the New Ordinary Shares to be issued pursuant to the Merger will not be registered under the United States Securities Act of 1933, as amended (the "US Securities Act"), or the laws of any state of the United States but will be issued in reliance on the exemption provided by Section 3(a)(10) of the US Securities Act and exemptions provided under the laws of each state of the United States in which Eligible Shareholders (subject to certain exceptions) reside. In addition, since neither London & Stamford nor Metric have any securities registered under Section 12 of the United States Securities Exchange Act of 1934, as amended (the "US Exchange Act"), and both London & Stamford and Metric qualify as "foreign private issuers" as defined in Rule 3b-4 under the US Exchange Act, the solicitation of proxies in connection with the Scheme of Arrangement is not subject to the proxy solicitation or tender offer rules under the US Exchange Act and is instead subject to the disclosure requirements, rules and practices applicable in the United Kingdom to schemes of arrangement, which differ from the requirements of US proxy solicitation or tender offer rules or the laws of other jurisdictions outside the United Kingdom. Financial information included in this announcement has been prepared, unless specifically stated otherwise, in accordance with IFRS and thus may not be comparable to the financial information of US companies or companies whose financial statements are prepared in accordance with generally accepted accounting principles in the US.
Unless otherwise determined by London & Stamford or required by the City Code, and permitted by applicable law and regulation, the Merger will not be made available, directly or indirectly, in, into or from a Restricted Jurisdiction where to do so would violate the laws in that jurisdiction and no person may vote in favour of the Merger by any such use, means, instrumentality or form within a Restricted Jurisdiction or any other jurisdiction if to do so would constitute a violation of the laws of that jurisdiction. Accordingly, copies of this announcement and all documents relating to the Merger are not being, and must not be, directly or indirectly, mailed or otherwise forwarded, distributed or sent in, into or from a Restricted Jurisdiction where to do so would violate the laws in that jurisdiction, and persons receiving this announcement and all documents relating to the Merger (including custodians, nominees and trustees) must not mail or otherwise distribute or send them in, into or from such jurisdictions where to do so would violate the laws in that jurisdiction. The Merger (unless otherwise permitted by applicable law and regulation) will not be made, directly or indirectly, in or into, or by the use of the mails, or by any means of instrumentality (including without limitation, telephonically or electronically) of interstate or foreign commerce of, or any facilities of a national securities exchange of any Restricted Jurisdiction, and the Merger will not be capable of acceptance from or within any Restricted Jurisdiction.
The availability of the New Ordinary Shares to Metric Shareholders who are not resident in the United Kingdom pursuant to the Merger may be affected by the laws of the relevant jurisdictions in which they are resident. Persons who are not resident in the United Kingdom should inform themselves of, and observe, any applicable requirements.
Forward looking statements
This announcement contains statements about London & Stamford and Metric that are or may be forward looking statements. All statements other than statements of historical facts included in this announcement may be forward looking statements. Without limitation, any statements preceded or followed by or that include the words "targets", "plans", "believes", "expects", "aims", "intends", "will", "may", "anticipates", "estimates", "projects" or words or terms of similar substance or the negative thereof, are forward looking statements. Forward looking statements include statements relating to the following: (i) future capital expenditures, expenses, revenues, earnings, synergies, economic performance, indebtedness, financial condition, dividend policy, losses and future prospects; (ii) business and management strategies and the expansion and growth of London & Stamford or Metric's operations and potential synergies resulting from the Merger; and (iii) the effects of government regulation on London & Stamford or Metric's respective businesses.
Such forward looking statements involve risks and uncertainties that could significantly affect expected results and are based on certain key assumptions. Many factors could cause actual results to differ materially from those projected or implied in any forward looking statements. Due to such uncertainties and risks, readers are cautioned not to place undue reliance on such forward looking statements, which speak only as of the date hereof. London & Stamford and Metric disclaim any obligation to update any forward looking or other statements contained herein, except as required by applicable law. Except as expressly provided in this announcement, no forward looking or other statements have been reviewed by the auditors of London & Stamford or Metric. All subsequent oral or written forward looking statements attributable to London & Stamford or Metric or any of their respective members, directors, officers or employees or any persons acting on their behalf are expressly qualified in their entirety by the cautionary statement above. Should one or more of these risks or uncertainties materialise, or should underlying assumptions prove incorrect, actual results may vary materially from those described in this announcement.
Disclosure requirements of the City Code
Under Rule 8.3(a) of the City Code, any person who is interested in one per cent. or more of any class of relevant securities of an offeree company or of any paper offeror (being any offeror other than an offeror in respect of which it has been announced that its offer is, or is likely to be, solely in cash) must make an Opening Position Disclosure following the commencement of the Offer Period and, if later, following the announcement in which any paper offeror is first identified. An Opening Position Disclosure must contain details of the person's interests and short positions in, and rights to subscribe for, any relevant securities of each of (i) the offeree company and (ii) any paper offeror(s). An Opening Position Disclosure by a person to whom Rule 8.3(a) applies must be made by no later than 3.30 p.m. (London time) on the 10th business day following the commencement of the Offer Period and, if appropriate, by no later than 3.30 p.m. (London time) on the 10th business day following the announcement in which any paper offeror is first identified. Relevant persons who deal in the relevant securities of the offeree company or of a paper offeror prior to the deadline for making an Opening Position Disclosure must instead make a Dealing Disclosure.
Under Rule 8.3(b) of the City Code, any person who is, or becomes, interested in one per cent. or more of any class of relevant securities of the offeree company or of any paper offeror must make a Dealing Disclosure if the person deals in any relevant securities of the offeree company or of any paper offeror. A Dealing Disclosure must contain details of the dealing concerned and of the person's interests and short positions in, and rights to subscribe for, any relevant securities of each of (i) the offeree company and (ii) any paper offeror, save to the extent that these details have previously been disclosed under Rule 8. A Dealing Disclosure by a person to whom Rule 8.3(b) applies must be made by no later than 3.30 p.m. (London time) on the Business Day following the date of the relevant dealing.
If two or more persons act together pursuant to an agreement or understanding, whether formal or informal, to acquire or control an interest in relevant securities of an offeree company or a paper offeror, they will be deemed to be a single person for the purpose of Rule 8.3.
Opening Position Disclosures must also be made by the offeree company and by any offeror and Dealing Disclosures must also be made by the offeree company, by any offeror and by any persons acting in concert with any of them (see Rules 8.1, 8.2 and 8.4).
Details of the offeree and offeror companies in respect of whose relevant securities Opening Position Disclosures and Dealing Disclosures must be made can be found in the Disclosure Table on the Panel's website at www.thetakeoverpanel.org.uk, including details of the number of relevant securities in issue, when the Offer Period commenced and when any offeror was first identified. You should contact the Panel's Market Surveillance Unit on +44 (0)20 7638 0129 if you are in any doubt as to whether you are required to make an Opening Position Disclosure or a Dealing Disclosure.
This summary should be read in conjunction with the full text of this announcement. The Merger will be subject to the Conditions and further terms set out in Appendix 1 to this announcement and to the full terms and conditions to be set out in the Scheme Document. Appendix 2 to this announcement contains further details of the sources of information and bases of calculations set out in this announcement, Appendix 3 contains a summary of the irrevocable undertakings received by London & Stamford (including those irrevocable undertakings given by the Metric Directors) and Appendix 4 contains definitions of certain expressions used in this summary and in this announcement.
Please be aware that addresses, electronic addresses and certain information provided by MetricShareholders, persons with information rights and other relevant persons for the receipt of communications from Metric may be provided to London & Stamford during the Offer Period as requested under Section 4 of Appendix 4 of the City Code to comply with Rule 2.12(c).
Publication on website and availability of hard copies
A copy of this announcement will be available free of charge, subject to certain restrictions relating to persons resident in Restricted Jurisdictions, on London & Stamford and Metric's websites at www.londonandstamford.com and www.metricproperty.co.uk, respectively, by no later than 12.00 p.m. on the Business Day following this announcement. Neither the contents of London & Stamford's website, nor those of Metric's website, nor those of any other website accessible from hyperlinks on either London & Stamford or Metric's website, are incorporated into or form part of this announcement.
You may request a hard copy of this announcement (and any information incorporated by reference in this announcement) by writing to Computershare Investor Services plc at The Pavilions, Bridgwater Road, Bristol, BS99 6ZZ or by calling 0870 889 3147 (or, if calling from outside the UK, on +44 870 889 3147). Calls cost approximately 8 pence per minute plus network extras, lines are open 9.00 a.m. - 5.30 p.m. Monday to Friday). It is important that you note that unless you make such a request, a hard copy of this announcement and any such information incorporated by reference in it will not be sent to you. You may also request that all future documents, announcements and information to be sent to you in relation to the Merger should be in hard copy form.
NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION IN WHOLE OR IN PART, IN, INTO OR FROM ANY JURISDICTION WHERE TO DO SO WOULD CONSTITUTE A VIOLATION OF THE RELEVANT LAWS OF SUCH JURISDICTION
9 November 2012
RECOMMENDED ALL-SHARE MERGER OF
LONDON & STAMFORD PROPERTY PLC ("LONDON & STAMFORD")
and
METRIC PROPERTY INVESTMENTS PLC ("METRIC")
to be effected by means of a Scheme of Arrangement
under Part 26 of the Companies Act 2006
1. Introduction
The boards of directors of London & Stamford and Metric are pleased to announce that they have reached agreement on the terms of a recommended merger pursuant to which London & Stamford will acquire the entire issued and to be issued ordinary share capital of Metric. The Merger is to be effected by means of a scheme of arrangement under Part 26 of the Companies Act.
2. The Merger
Under the terms of the Merger, Metric Shareholders will be entitled to receive:
0.94 New Ordinary Shares for each Metric Ordinary Share,
resulting in Metric Shareholders owning 25 per cent. and London & Stamford Shareholders owning 75 per cent. of the Enlarged Share Capital.
On the basis of the Closing Price per Ordinary Share of 117 pence on 5 November 2012, the Merger values each Metric Ordinary Share at 110 pence and the entire issued and to be issued share capital of Metric at approximately £209.0 million.
The Merger represents a premium of approximately:
· 18 per cent. to the Closing Price per Metric Ordinary Share of 93 pence on 5 November 2012 (being the last Business Day prior to the commencement of the Offer Period); and
· 24 per cent. to the six-month average price per Metric Ordinary Share of 89 pence (being the average Closing Price for the six-month period ended on 5 November2012, being the last Business Day prior to the commencement of the Offer Period).
The Merger Ratio has been calculated on the basis that, other than the London & Stamford Interim Dividend and the Metric Interim Dividend, no dividends will be declared by London & Stamford or Metric following the date of this announcement until completion of the Merger.
It is expected that the Scheme Document will be published as soon as is reasonably practicable and in any event within 28 days of this announcement, that the Metric Court Meeting and the Metric General Meeting will be held in late December 2012 or early January 2013 and that the Scheme will become effective by the end of January 2013 and the Proposals completed by the end of February 2013.
3. London & Stamford Board recommendation
The London & Stamford Directors intend to recommend that London & Stamford Shareholders vote in favour of the resolutions to be proposed at the London & Stamford General Meeting, as they have irrevocably undertaken to do in respect of their own beneficial holdings, to the extent that they are permitted to vote on such resolutions.
The resolution approving the release of the Former LSI Management Members from their clawback obligations and the subsequent acquisition of 76.5 per cent. of the Existing Management Incentive Shares for £8 in aggregate pursuant to the Existing Management Incentive Termination Agreement will require shareholder approval under the Companies Act. In accordance with the Companies Act, the London & Stamford Directors who are Former LSI Management Members will not vote on the resolution. The London & Stamford Directors have therefore undertaken to vote in favour of the resolutions to be proposed at the London & Stamford General Meeting in respect of 40,212,932 Ordinary Shares in aggregate (save for the resolution in relation to the Existing Management Incentive Agreement, where their undertakings are in respect of 100,000 Ordinary Shares in aggregate).
4. Background to and reasons for the London & Stamford Board recommendation
London & Stamford's business strategy is to create and actively manage a property investment portfolio in the UK where the prospects for creating value from asset management activity are good and where, with the benefit of prudent gearing, the initial yield on equity is in excess of 10 per cent. In line with this strategy, the Board decided to sell what it considered to be its mature investment in Meadowhall and to commence discussions with Metric. The Directors believe that the Merger has a number of important attractions for London & Stamford, including:
· providing access to Metric's retail portfolio, which has been assembled since Metric's flotation in March 2010 by a highly competent management team and represents an outstanding route back into the sector and opportunity to redeploy funds following the sale of Meadowhall;
· Metric's very well let portfolio which has an attractive running yield that represents an excellent opportunity for London & Stamford with embedded asset management opportunities;
· a proven ability to deliver income growth both across London & Stamford's London residential and commercial investments and Metric's retail assets, whilst also deploying capital in other related property assets across the UK on an opportunistic basis;
· a growing income stream which should bring forward the time when the dividend is fully covered and can grow further;
· a joint market leading real estate team which will provide through-the-cycle opportunities to build value through income growth, asset management and development opportunities; and
· complementary management skills and cultural fit across the two groups which combine a long track record of superior capital generation with specialist retail expertise.
Following completion of the Merger, London & Stamford and Metric intend to merge their operations into a single unified business, under a unified board structure and senior management team. London & Stamford and Metric have conducted a general review of the operations, assets and employees of the other and this has led to the identification of potential synergies resulting from the Merger, based on the centralisation of London & Stamford's and Metric's operating functions, which is expected to yield annual cost savings.
5. Metric Board recommendation
The Metric Directors, who have been so advised by J.P. Morgan Cazenove, consider the terms of the Merger to be fair and reasonable. In providing advice to the Metric Directors, J.P. Morgan Cazenove has taken into account the commercial assessments of the Metric Directors.
Accordingly, the Metric Directors intend unanimously to recommend that Metric Shareholders vote in favour of the Scheme at the Metric Court Meeting and vote in favour of the Metric Resolution to be proposed at the Metric General Meeting as they have irrevocably undertaken to do in respect of their own beneficial holdings of 6,101,914Metric Ordinary Shares representing, in aggregate, approximately 3.2 per cent. of the ordinary share capital of Metric in issue on 8 November 2012 (being the latest practicable date prior to this announcement). Further details of these undertakings are set out in Appendix 3 of this announcement.
6. Background to and reasons for the Metric Board recommendation
Metric was established to assemble a portfolio of freehold and long leasehold retail properties principally throughout the UK, but with the ability to invest in Ireland and also to exploit opportunities in multi-let leisure schemes.
The Metric Directors believe that Metric has now achieved a critical mass, in terms of both size and diversification within the UK retail property market, and that a combination with London & Stamford (which is also a UK REIT) will allow Metric Shareholders a wider range of exposure to the property sector and will present Metric with further opportunities for expansion. With London & Stamford's disposal of its Meadowhall shopping centre, London & Stamford's current portfolio is now firmly focused on London residential and commercial property, in particular distribution centres. The Metric Directors believe that such a portfolio would be highly complementary to Metric's UK retail focused portfolio. Further, London & Stamford's investment capacity following the sale of Meadowhall would put the Enlarged Group in a prime position to take advantage of expected future investment opportunities.
The particularly strong retail expertise of the Metric Directors would enjoy the support of the larger combined balance sheet. This would enable the Enlarged Group to grow its development pipeline and pursue opportunities of greater scale than Metric alone, and thereby to maximise its ability to work successfully in the retail and London property sectors and make opportunistic acquisitions.
The Metric Directors believe that the Proposals present a number of other benefits for Metric Shareholders, including:
· attractive merger terms: the Merger represents a premium of 18 per cent. on the basis of the Closing Price per Ordinary Share on 5 November 2012, the day prior to the commencement of the Offer Period;
· enhanced dividend payout: the Merger is expected to lead to an enhanced dividend payout for Metric Shareholders;
· Tender Offer: the Tender Offer represents an opportunity for Metric Shareholders to participate in a return of capital;
· improved liquidity: pursuant to the terms of the Scheme, Metric Shareholders will receive New Ordinary Shares in a top ten UK REIT, with a liquid listing;
· diversified capital base: the Enlarged Group will have access to a broader shareholder base as well as a broader range of financing options;
· balance sheet scale: a larger combined balance sheet would also allow the execution of greater deal flow;
· synergies: the Metric Directors expect that a combination of Metric and London & Stamford will lead to synergies;
· diversification: the Enlarged Group will have a wider spread of portfolio and sector income; and
· strategic partnerships: a combination of London & Stamford and Metric will give each access to the other's joint venture and other strategic relationships and the opportunity to further expand such relationships.
7. Irrevocable undertakings
London & Stamford and Metric have received irrevocable undertakings from each of the Metric Directors and to vote in favour of the Scheme at the Metric Court Meeting and vote in favour of the Metric Resolution to be proposed at the Metric General Meeting, in respect of a total of 6,101,914 Metric Ordinary Shares, representing approximately 3.2 per cent. of the ordinary share capital of Metric in issue on 8 November 2012 (being the latest practicable date prior to this announcement). Further details of these irrevocable undertakings are set out in Appendix 3 of this announcement.
London & Stamford have also received irrevocable undertakings from each of the London & Stamford Directors to vote in favour of the resolutions to be proposed at the London & Stamford General Meeting in relation to the Merger, to the extent they are permitted to vote on such resolutions, in respect of a total of 40,212,932 Ordinary Shares, representing approximately 7 per cent. of the ordinary share capital of London & Stamford in issue on 8 November 2012 (being the latest practicable date prior to this announcement). Further details of these irrevocable undertakings are set out in Appendix 3 to this announcement.
8. Background to and reasons for the Tender Offer
Following completion of the Merger, the Directors propose to undertake a return of capital of £100 million to Eligible Shareholders of the Enlarged Company. The proposed Tender Offer, to the extent taken up, would deliver a more efficient capital structure, leaving sufficient resources for the Enlarged Group to execute its business plan. The Directors believe that the Tender Offer is the most appropriate mechanism for the contemplated return of capital, as it:
· provides Eligible Shareholders of the Enlarged Company who wish to sell shares with the opportunity to do so;
· enables those shareholders who do not wish to receive capital at this time to maintain their full investment in the Enlarged Company; and
· will be available to all Eligible Shareholders regardless of the size of their shareholdings in the Enlarged Company.
As at the date of this announcement, it is proposed that up to 88,573,959 Ordinary Shares be purchased under the Tender Offer, representing approximately 12 per cent. of the Enlarged Share Capital, for a maximum aggregate cash consideration of £100 million.
The price per Ordinary Share at which tenders may be made will be announced following the Effective Date but in any event will not be less than 112.9 pence per Ordinary Share which equates to the pro forma EPRA NAV of the Enlarged Group as at 30 September 2012 (excluding goodwill arising upon the Merger).
Full details of the Tender Offer, including detailed terms and conditions, the price per share at which tendered shares will be purchased and explanations as to how to tender Ordinary Shares will be sent to Eligible Shareholders of the Enlarged Company in due course and such shareholders in the Enlarged Company will be able to choose whether or not to participate in the Tender Offer. If the Tender Offer is not taken up in full, the Enlarged Company will keep those funds for reinvestment and continue to review the appropriate balance sheet structure, relative to the opportunities within the property market.
9. Information on London & Stamford
London & Stamford is a public limited company incorporated in England and Wales and is the holding company of the London & Stamford Group. As at 5 November 2012 (being the last practicable date prior to the commencement of the Offer Period), London & Stamford had a market capitalisation of £635.1 million and, as at 30 September 2012, had Net Assets of £609.8 million and an EPRA NAV of 114.0 pence per Ordinary Share.
London & Stamford invests in residential and commercial property, including office and distribution real estate assets all of which are located in the UK, where the Directors consider the opportunity exists to extract above-average returns for shareholders. London & Stamford is an active investor and implements strategies to enhance the quality and value of acquired assets and improve annual rental values.
The London & Stamford Group has a highly experienced management team which includes Raymond Mould, Patrick Vaughan and Martin McGann who are also on the Board. Raymond Mould and Patrick Vaughan have been involved in a number of listed and unlisted property companies and funds since 1970, including Arlington and Pillar. London & Stamford's board of directors is completed by Charles Cayzer, Humphrey Price, James Dean, Richard Crowder and Mark Burton (each a non-executive director).
London & Stamford is a UK-REIT and was admitted to the premium segment of the Official List and to trading on the Main Market of the London Stock Exchange on 1 October 2010.
10. Information on Metric
Metric is a public limited company incorporated in England and Wales and is the holding company of the Metric Group. As at 5 November 2012 (being the last practicable date prior to commencement of the Offer Period), Metric had a market capitalisation of £176.7 million and, as at 30 September 2012, had Net Assets of £200.1 million and an EPRA NAV of 107 pence per share.
As at 31 March 2012, the Metric Group had consolidated gross assets of £251.1 million and net assets of £201.3 million, and in the year to 31 March 2012, the Metric Group made a consolidated profit of £13.2 million.
Metric's investment policy aims to deliver attractive returns for shareholders through a strategy of increasing income and improving capital values.
Metric was established to assemble a portfolio of freehold and long leasehold retail properties throughout the UK and Ireland, principally investing in the retail property markets, but also considering investing in multi-let leisure schemes.
Metric employs an occupier-led approach with a view to extracting long-term value from investment properties through opportunistic acquisitions, joint ventures, active asset management, limited risk development and timely disposals. Metric focuses on assets that it believes have enduring occupier appeal and which provide opportunities for management to improve both rental values and the longevity and security of income. Metric also undertakes limited risk re-development of properties with the aim of enhancing shareholder returns.
Metric was co-founded by Andrew Jones, Valentine Beresford, Mark Stirling and Sue Ford. Sue Ford has served as Metric's finance director since its inception. Metric's board of directors is completed by Andrew Huntley (non-executive Chairman) and Alec Pelmore, Andrew Varley and Philip Watson (each a non-executive director).
Metric is a UK-REIT and has been listed on the Official List and admitted to trading on the Main Market since its initial public offering on 24 March 2010.
11. Dividends
On 9 November 2012, London & Stamford announced an interim dividend of 3.5 pence per Ordinary Share which will be paid on 7 December 2012 to London & Stamford Shareholders on the register of members on 23 November 2012 .
On 9 November 2012, Metric announced an interim dividend of 1.8 pence per Metric Ordinary Share which will be paid on 7 December 2012 to Metric Shareholders on the register of members on 23 November 2012, in accordance with London & Stamford's normal dividend timetable.
Following completion of the Merger, the Enlarged Group intends to maintain an annual dividend of 7 pence per Ordinary Share, with further anticipated growth in the future. 1
1 This is a target and not a profit forecast.
12. Intentions for the Enlarged Group
12.1 Board and management
Following completion of the Merger, the board of directors of the Enlarged Company will be drawn from the boards of directors of both companies and will include (a) Patrick Vaughan, Chief Executive of London & Stamford, as Executive Chairman, (b) Andrew Jones, Chief Executive of Metric, as Chief Executive and (c) Martin McGann, Finance Director of London & Stamford, as Finance Director. An Executive Committee will be formed, initially comprising the three executive directors as well as Valentine Beresford and Mark Stirling. Sue Ford has informed the Metric Board that she intends to retire from her role as Finance Director following completion of the Merger.
The combination of the management teams of London & Stamford and Metric provides the opportunity for Raymond Mould the current Chairman of London & Stamford to retire, confident that the management of the Enlarged Group under the Chairmanship of Patrick Vaughan and with Andrew Jones as Chief Executive is in excellent hands. At the age of 72 and having suffered some poor health over the last few months, Raymond feels that the Merger is a logical and well timed moment to retire. He has agreed to continue to make himself available under a consultancy arrangement following completion of the Merger and is delighted that he will be able to remain in touch and contribute to the future success of the Enlarged Group, whose management he has known well for many years, giving him great confidence in their future.
The Boards of London & Stamford and Metric consider that Patrick's appointment as Executive Chairman is critical to the Merger's success. His experience as a founder of London & Stamford represents an appropriate and desirable level of continuity. His excellent prior working relationship with the Chief Executive of Metric is an additional factor which will enable the combination of the two companies to be swiftly achieved.
Furthermore, his relationship with critical joint venture partners is also considered to be crucial to maintaining their continuing support. For these reasons, the boards of directors of both London & Stamford and Metric believe Patrick's appointment as Executive Chairman to be very important to delivering the benefits of the Merger and creating shareholder value in the Enlarged Group. Accordingly, in light of the proposed Merger, both boards of directors will consult with certain leading shareholders of London & Stamford and Metric and explain their recommendation. Taking into consideration the generally accepted principles of the UK Corporate Governance Code, both boards of directors believe that Patrick's appointment as Executive Chairman should be regarded, in every respect, as an appropriate exception.
In addition, the board of directors of the Enlarged Company will comprise eight non-executive directors drawn equally from London & Stamford and Metric's existing non-executive directors. Richard Crowder has advised the Board that he intends to retire from his role as non-executive director of London & Stamfordfollowing completion of the Merger.
Following completion of the Merger, the board of directors of the Enlarged Group will comprise: Patrick Vaughan (Executive Chairman); Andrew Jones (Chief Executive); Martin McGann (Finance Director); Charles Cayzer (Non-executive Director); Mark Burton (Non-executive Director); Humphrey Price (Non-executive Director); James Dean (Non-executive Director); Andrew Huntley (Non-executive Director); Alec Pelmore (Non-executive Director); Andrew Varley (Non-executive Director); Philip Watson (Non-executive Director). The details of any service contracts to be entered into between London & Stamford and the Metric directors will be set out in the Combined Circular and Prospectus.
12.2 Strategy and firepower
Following completion of the Merger, the Enlarged Group will continue as a highly entrepreneurial UK REIT investing across the key sectors of the UK real estate market. There will be an increasing focus on retail and on the London economic area, both because of the highly developed retail property skills which will be incorporated within the Enlarged Group and because of the strong economic profile of the London area. The Enlarged Group will seek opportunities to deliver strong income growth through its programme of opportunistic acquisitions, capital recycling and intensive asset management.
The Enlarged Group will have £594 million of bank facilities from nine lenders, of which £192 million is undrawn as at 8 November 2012. With pro forma gross property assets taking into account its share of joint ventures as at 30 September 2012 of £993 million, the Enlarged Group would have a loan-to-value ratio of 31 per cent. Taking into account borrowings under such facilities up to 50 per cent. on a loan-to-value basis, the Enlarged Group's existing cash following the Tender Offer and the equity commitments of its joint venture partners, it is expected to have approximately £870 million available to invest.
The London & Stamford and Metric Directors believe that the marginal cost of any new debt would be approximately 3.8 per cent.
London & Stamford and Metric attach great importance to the skills and experience of the existing management and employees of Metric and believe that they will benefit from greater opportunities within the Enlarged Group. Following the completion of the Merger, the existing employment rights, including pension rights, of the management and employees of Metric will be fully safeguarded. The current plans do not involve any material change in the conditions of employment of Metric's employees. It is intended that following completion of the Merger, Metric and London & Stamford will find new premises in which to relocate.
Following completion of the Merger, the Enlarged Company will remain listed on the London Stock Exchange and it is intended that the Enlarged Group will operate under a new name, LondonMetric Property Plc.
12.3 property portfolio and trending
If the Merger becomes effective, the Enlarged Group would initially have a balanced split across the portfolio (on the basis of their respective valuations at 30 September 2012) between retail property (25 per cent.), opportunistic investments (18 per cent.) London area offices (22 per cent.), London area development (7 per cent.), London area residential property (20 per cent.) and cash (8 per cent.).2
2 Following completion of the Tender Offer and taking into account transaction costs relating to the Proposals.
The aggregate exposure to the London market across all sectors of the portfolio would be 49 per cent., a figure which the board of directors of the Enlarged Company would expect to remain relatively constant in the medium term. Management of the Enlarged Company expects its exposure to retail property and opportunistic investments to grow over time and accordingly cash to decline.
As at 30 September 2012, the Enlarged Group would have a total rent roll of £50.3m, a 93 per cent. occupancy level across its investment portfolio, a weighted average unbroken lease term of 11.4 years (10.6 years to the first break) and its top ten tenants would contribute 49 per cent. of its total rent.
13. Arrangements between London & Stamford and Metric management and London & Stamford Existing Management Incentives and GEPT
Following completion of the Merger, existing long term incentive plans for the management of Metric will be terminated.
As a result of the significance of the Merger and the substantial changes to the composition of the board of directors of London & Stamford and senior management, it is proposed that, with effect from completion of the Merger, certain clawback provisions in relation to the Existing Incentive Shares of the Existing Management Incentives Agreement will be terminated pursuant to the Existing Management Incentives Termination Agreement.
The release of the Former LSI Management Members from their clawback obligations and the subsequent acquisition of 76.5 per cent. of the Existing Incentive Shares for £8 in aggregate pursuant to the Existing Management Incentives Termination Agreement will require shareholder approval under the Companies Act. As a consequence, it is proposed that GEPT will pay to London & Stamford £1.91 million being the cash equivalent of 76.5 per cent. of the 2,081,599 ordinary shares which would have been bought back by London & Stamford if they had not been disposed of by GEPT.
After completion of the Merger, it will be a priority for the newly constituted board of directors of the Enlarged Company and its appointed remuneration committee to put in place revised salary and bonus arrangements and new long term incentive arrangements for the senior executives of the Enlarged Company in line with the market. Any scheme will be required to compensate for the value of any existing scheme which is being terminated. Patrick Vaughan and Martin McGann will not participate in any of the revised bonus or long term incentive arrangements until 30 September 2013.
14. Metric Share Schemes
Metric's Remuneration Committee has indicated that it intends to exercise its discretion under the Metric Matching Share Plan on the business day following Court sanction of the Merger to permit 25 per cent. of the awards granted in respect of the 2010/11 financial year and 75 per cent. of the awards to be granted in respect of the 2011/12 financial year to vest.
The Remuneration Committee has stated the exercise of such discretion is conditional upon the members of the Executive Committee receiving such awards each agreeing that the New Ordinary Shares resulting from the effects of the Merger on the awards will not be sold before 31 May 2014 (in respect of shares from the 2010/11 financial year awards) and 31 May 2015 (in respect of shares from the 2011/12 financial year awards) and will be clawed back as if the Metric Management Incentive Plan were still in effect if they cease to be employees of the Enlarged Group in certain circumstances.
Participants in the Metric Company Share Option Plan will be contacted regarding the effect of the Merger on their rights under the Metric Company Share Option Plan and appropriate proposals will be made to such participants in due course.
15. Offer related arrangements
London & Stamford and Metric entered into a confidentiality agreement on 3 September 2012 pursuant to which each of London & Stamford and Metric has undertaken to keep confidential information relating to the other party and not to disclose it to third parties (other than to permitted disclosees) unless required by law or regulation. These confidentiality obligations continue in effect indefinitely.
16. Opening Position Disclosures and interests
London & Stamford confirms that it is making on the date of this announcement an Opening Position Disclosure, setting out the details required to be disclosed by it under Rule 8.1(a) of the City Code. The Opening Position Disclosure does not include all relevant details in respect of London & Stamford's concert parties and London & Stamford confirms that a further disclosure in accordance with Rule 8.1(a) and Note 2(a)(i) on Rule 8 of the City Code will be made as soon as possible, if required.
17. Structure of the Merger
Scheme of Arrangement and New Ordinary Shares
It is intended that the Merger will be effected by means of a scheme of arrangement between Metric and Metric Shareholders under Part 26 of the Companies Act.
The purpose of the Scheme is to provide for London & Stamford to become the owner of the whole of the issued and to be issued share capital of Metric.
The Scheme will involve a reduction of capital pursuant to section 641 of the Companies Act. The procedure involves an application by Metric to the Court to sanction the Scheme and to confirm the cancellation of the Scheme Shares by way of the Capital Reduction and the application of the reserve arising from such cancellation in paying up in full a number of New Metric Shares (which is equal to the number of Metric Ordinary Shares cancelled) and issuing the same to London & Stamford, in consideration for which the Metric Shareholders will receive New Ordinary Shares on the basis of the Merger Ratio.
The New Ordinary Shares will be issued in registered form and will be capable of being held in both certificated and uncertificated form. Fractions of the New Ordinary Shares will not be allotted or issued pursuant to the Merger, but entitlements of Scheme Shareholders will be rounded up or down (with 0.5 being rounded up) to the nearest whole number of New Ordinary Shares.
Conditions
The implementation of the Scheme will be subject to the Conditions and further terms which are set out in Appendix 1 of this announcement and the further terms and conditions set out in the Scheme Document and the related Forms of Proxy when issued.
If the Scheme does not become effective by 31 March 2013 (or such later date and time as London & Stamford and Metric may agree and the Court (if required) and the Panel may allow) the Merger will not take place.
Once the necessary approvals from Metric Shareholders have been obtained and the other Conditions have been satisfied, or (where applicable) waived, the Scheme will become effective upon sanction by the Court and the delivery of a copy of the Court Order to, and, if so ordered by the Court, the registration of the Court Order together with the statement of capital attached thereto by, the Registrar of Companies. Upon the Scheme becoming effective, it will be binding on all Scheme Shareholders, irrespective of whether or not they attended or voted at the Metric Court Meeting or the Metric General Meeting (and if they attended and voted, whether they voted in favour).
Election to switch
London & Stamford has reserved the right to elect (with Metric's consent in writing) for the Merger to be implemented by way of a Takeover Offer. In this event, the Takeover Offer will be implemented on the same terms, so far as applicable, as those which would apply to the Scheme. If London & Stamford does elect to implement the Merger by way of a Takeover Offer, and if sufficient acceptances of such offer are received and/or sufficient Metric Ordinary Shares are otherwise acquired, it is the intention of London & Stamford to apply the provisions of sections 979 to 982 (inclusive) of the Companies Act to acquire compulsorily any outstanding Metric Ordinary Shares to which such offer relates.
18. Delisting, compulsory acquisition and re-registration
Prior to the Scheme becoming Effective, an application will be made to the London Stock Exchange and the UK Listing Authority respectively for trading of the Metric Ordinary Shares on the London Stock Exchange's main market for listed securities and the listing of Metric Ordinary Shares on the Official List to be cancelled. The last day of dealings in, and for registration of transfers of, Metric Ordinary Shares is expected to be the day before the Scheme Court Hearing and at the close of business on that date the trading of Metric Ordinary Shares on the London Stock Exchange's main market for listed securities will be suspended. No transfers of Metric Ordinary Shares will be registered after this date, other than the registration of Metric Ordinary Shares released, transferred or issued under the Metric Share Schemes.
It is intended that the delisting of the Metric Ordinary Shares will take effect on the Effective Date. In addition, on the Effective Date, entitlements to Metric Ordinary Shares held within the CREST system will be cancelled and share certificates in respect of Scheme Shares will cease to be valid and should, if so requested by Metric, be sent to Metric for cancellation. It is also intended that Metric will be re-registered as a private limited company as part of the Scheme.
Upon the Scheme becoming Effective, London & Stamford (and/or its nominee(s)) will acquire New Metric Shares fully paid and free from all liens, equitable interests, charges, encumbrances 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 or made after the Effective Date save the Interim Dividend.
19. Listing, dealing and settlement
An application will be made to the UK Listing Authority and to the London Stock Exchange for the New Ordinary Shares to be admitted to the premium listing segment of the Official List and to the London Stock Exchange's market for listed securities for such shares to be admitted to trading.
It is expected that Admission will become effective and that unconditional dealings in the New Ordinary Shares will commence in late January 2013.
20. London & Stamford Shareholder approval
London & Stamford is required to comply with the provisions of Chapter 10.5 of the Listing Rules in relation to the Merger and therefore seeks the approval of Shareholders pursuant to the Listing Rules. London & Stamford Shareholders must authorise London & Stamford to make share purchases for the purposes of the Tender Offer and for the purpose of the Existing Incentive Shares Cancellation. The Merger will be conditional on, among other things, the requisite resolutions being passed by the London & Stamford Shareholders at the London & Stamford General Meeting.
Pursuant to the Listing Rules, London & Stamford is required to prepare and send to its shareholders, as soon as is reasonably practicable, an explanatory circular summarising the background to and reasons for the Merger, the Tender Offer and the Existing Incentive Shares Cancellation. London & Stamford is also required to publish a prospectus in connection with the issue of the New Ordinary Shares.
Accordingly, London & Stamford will prepare the Combined Circular and Prospectus which will contain a notice convening the London & Stamford General Meeting and information relating to, amongst other things, the Enlarged Group and the New Ordinary Shares.
21. Expected timetable
The Scheme Document containing further details of the Merger will be despatched to Metric Shareholders (other than to Restricted Overseas Persons) and, for information only, to participants in the Metric Share Schemes as soon as is reasonably practicable and, in any event, within 28 days of the date of this announcement. The Scheme Document will include the anticipated timetable and will specify the necessary actions to be taken by Metric Shareholders.
22. Overseas Metric Shareholders
The distribution of this announcement to, and the availability of the New Ordinary Shares to be issued pursuant to the Merger to, persons who are not resident in the United Kingdom or the United States 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. Further details in relation to overseas shareholders of Metric will be found in the Scheme Document.
This announcement does not constitute, or form part of, any offer for, or any solicitation of any offer for, securities, nor is it a solicitation of any vote or approval in any jurisdiction, nor will there be any purchase or transfer of the securities referred to in this announcement in any jurisdiction in contravention of applicable law or regulation.
23. Documents on display
Copies of the following documents will be made available on London & Stamford and Metric's websites at www.londonandstamford.com and www.metricproperty.co.uk, respectively until the end of the Offer Period:
· the irrevocable undertakings referred to in paragraph 7 above and summarised in Appendix 3 to this announcement; and
· the Confidentiality Agreement.
24. General
The Scheme will be governed by English law and will be subject to the jurisdiction of the courts of England and Wales. The Scheme will be subject to the applicable requirements of the City Code, the Panel, the London Stock Exchange and the FSA.
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Credit Suisse, which is authorised and regulated in the United Kingdom by the Financial Services Authority, is acting exclusively for London & Stamford and no one else in connection with the Proposals and will not be responsible to anyone other than London & Stamford for providing the protections afforded to clients of Credit Suisse or for providing advice in connection with the Proposals or any matter or arrangement referred to herein. Neither Credit Suisse nor any of its subsidiaries, branches or affiliates owes or accepts any duty, liability or responsibility whatsoever (whether direct or indirect, whether in contract, in tort, under statute or otherwise) to any person who is not a client of Credit Suisse in connection with the Proposals, this announcement, any statement contained herein or otherwise.
Peel Hunt, which is authorised and regulated in the United Kingdom by the Financial Services Authority, is acting exclusively for London & Stamford and no one else in connection with the Proposals and will not be responsible to anyone other than London & Stamford for providing the protections afforded to clients of Peel Hunt or for providing advice in connection with the Proposals or any matter or arrangement referred to herein. Neither Peel Hunt nor any of its subsidiaries, branches or affiliates owes or accepts any duty, liability or responsibility whatsoever (whether direct or indirect, whether in contract, in tort, under statute or otherwise) to any person who is not a client of Peel Hunt in connection with the Proposals, this announcement, any statement contained herein or otherwise.
J.P. Morgan Cazenove, which is authorised and regulated in the United Kingdom by the Financial Services Authority, is acting exclusively for Metric and no one else in connection with the Merger, and will not be responsible to anyone other than Metric for providing the protections afforded to clients of J.P. Morgan Cazenove or for providing advice in connection with the Merger or any matter or arrangement referred to herein. Neither J.P. Morgan Cazenove nor any of its subsidiaries, branches or affiliates owes or accepts any duty, liability or responsibility whatsoever (whether direct or indirect, whether in contract, in tort, under statute or otherwise) to any person who is not a client of J.P. Morgan Cazenove in connection with the Proposals, this announcement, any statement contained herein or otherwise.
Oriel Securities, which is authorised and regulated in the United Kingdom by the Financial Services Authority, is acting exclusively for Metric and no one else in connection with the Merger, and will not be responsible to anyone other than Metric for providing the protections afforded to clients of Oriel Securities or for providing advice in connection with the Merger or any matter or arrangement referred to herein. Neither Oriel Securities nor any of its subsidiaries, branches or affiliates owes or accepts any duty, liability or responsibility whatsoever (whether direct or indirect, whether in contract, in tort, under statute or otherwise) to any person who is not a client of Oriel Securities in connection with the Proposals, this announcement, any statement contained herein or otherwise.
This announcement is for information purposes only and is not intended to and does not constitute or form part of an offer to sell or subscribe for or any invitation to purchase or subscribe for any securities or the solicitation of an offer to buy any securities, pursuant to the Merger or otherwise. The Merger will be made solely by means of the Scheme Document which will contain the full terms and conditions of the Merger, including details of how to vote in respect of the Scheme.
Any approval, decision or other response to the Merger should be made only on the basis of the information in the Scheme Document and the Combined Circular and Prospectus. Metric Shareholders are strongly advised to read the formal documentation in relation to the Merger once it has been despatched. It is expected that the Scheme Document (including notices of the Metric Shareholder Meetings) together with the relevant Forms of Proxy and the Combined Circular and Prospectus, will be posted to Metric Shareholders as soon as is reasonably practicable and in any event within 28 days of this announcement, unless otherwise agreed with the Panel.
Metric will prepare the Scheme Document to be distributed to Metric Shareholders. Metric and London & Stamford urge Metric Shareholders to read the Scheme Document and the Combined Circular and Prospectus when they become available because they will contain important information relating to the Merger.
Any approval, decision or other response to the Proposals should be made only on the basis of the information in the Combined Circular and Prospectus. London & Stamford Shareholders are strongly advised to read the formal documentation in relation to the Merger once it has been despatched. It is expected that the Combined Circular and Prospectus (including the notice of the London & Stamford General Meeting) together with the relevant form of proxy, will be posted to London & Stamford Shareholders as soon as is reasonably practicable and in any event within 28 days of this announcement, unless otherwise agreed with the Panel.
London & Stamford will prepare the Combined Circular and Prospectus to be distributed to London & StamfordShareholders. London & Stamford urges London & Stamford Shareholders to read the Combined Circular and Prospectus when it becomes available because it will contain important information relating to the Proposals.
The statements contained in this announcement are made as at the date of this announcement, unless some other time is specified in relation to them. Nothing contained in this announcement shall be deemed to be a forecast, projection or estimate of the future financial performance of Metric or the Metric Group or London & Stamford or the London & Stamford Group except where otherwise stated.
Overseas shareholders
The release, publication or distribution of this announcement in certain jurisdictions may be restricted by law. Persons who are not resident in the United Kingdom or who are subject to the laws of any jurisdiction other than the United Kingdom should inform themselves of, and observe, any applicable requirements. Any failure to comply with the restrictions may constitute a violation of the securities laws of any such jurisdiction. This announcement does not constitute an offer or an invitation to purchase or subscribe for any securities or a solicitation of an offer to buy any securities pursuant to this announcement or otherwise in any jurisdiction in which such offer or solicitation is unlawful. This announcement has been prepared for the purposes of complying with the laws of England and Wales 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 any jurisdiction outside England and Wales.
The Merger relates to shares of two UK companies and is proposed to be effected by means of a scheme of arrangement under the laws of England and Wales. Accordingly, the New Ordinary Shares to be issued pursuant to the Merger will not be registered under the United States Securities Act of 1933, as amended (the "US Securities Act"), or the laws of any state of the United States but will be issued in reliance on the exemption provided by Section 3(a)(10) of the US Securities Act and exemptions provided under the laws of each state of the United States in which Eligible Shareholders (subject to certain exceptions) reside. In addition, since neither London & Stamford nor Metric have any securities registered under Section 12 of the United States Securities Exchange Act of 1934, as amended (the "US Exchange Act"), and both London & Stamford and Metric qualify as "foreign private issuers" as defined in Rule 3b-4 under the US Exchange Act, the solicitation of proxies in connection with the Scheme of Arrangement is not subject to the proxy solicitation or tender offer rules under the US Exchange Act and is instead subject to the disclosure requirements, rules and practices applicable in the United Kingdom to schemes of arrangement, which differ from the requirements of US proxy solicitation or tender offer rules or the laws of other jurisdictions outside the United Kingdom. Financial information included in this announcement has been prepared, unless specifically stated otherwise, in accordance with IFRS and thus may not be comparable to the financial information of US companies or companies whose financial statements are prepared in accordance with generally accepted accounting principles in the US.
Unless otherwise determined by London & Stamford or required by the City Code, and permitted by applicable law and regulation, the Merger will not be made available, directly or indirectly, in, into or from a Restricted Jurisdiction where to do so would violate the laws in that jurisdiction and no person may vote in favour of the Merger by any such use, means, instrumentality or form within a Restricted Jurisdiction or any other jurisdiction if to do so would constitute a violation of the laws of that jurisdiction. Accordingly, copies of this announcement and all documents relating to the Merger are not being, and must not be, directly or indirectly, mailed or otherwise forwarded, distributed or sent in, into or from a Restricted Jurisdiction where to do so would violate the laws in that jurisdiction, and persons receiving this announcement and all documents relating to the Merger (including custodians, nominees and trustees) must not mail or otherwise distribute or send them in, into or from such jurisdictions where to do so would violate the laws in that jurisdiction. The Merger (unless otherwise permitted by applicable law and regulation) will not be made, directly or indirectly, in or into, or by the use of the mails, or by any means of instrumentality (including without limitation, telephonically or electronically) of interstate or foreign commerce of, or any facilities of a national securities exchange of any Restricted Jurisdiction, and the Merger will not be capable of acceptance from or within any Restricted Jurisdiction.
The availability of the New Ordinary Shares to Metric Shareholders who are not resident in the United Kingdom pursuant to the Merger may be affected by the laws of the relevant jurisdictions in which they are resident. Persons who are not resident in the United Kingdom should inform themselves of, and observe, any applicable requirements.
Forward looking statements
This announcement contains statements about London & Stamford and Metric that are or may be forward looking statements. All statements other than statements of historical facts included in this announcement may be forward looking statements. Without limitation, any statements preceded or followed by or that include the words "targets", "plans", "believes", "expects", "aims", "intends", "will", "may", "anticipates", "estimates", "projects" or words or terms of similar substance or the negative thereof, are forward looking statements. Forward looking statements include statements relating to the following: (i) future capital expenditures, expenses, revenues, earnings, synergies, economic performance, indebtedness, financial condition, dividend policy, losses and future prospects; (ii) business and management strategies and the expansion and growth of London & Stamford or Metric's operations and potential synergies resulting from the Merger; and (iii) the effects of government regulation on London & Stamford or Metric's respective businesses.
Such forward looking statements involve risks and uncertainties that could significantly affect expected results and are based on certain key assumptions. Many factors could cause actual results to differ materially from those projected or implied in any forward looking statements. Due to such uncertainties and risks, readers are cautioned not to place undue reliance on such forward looking statements, which speak only as of the date hereof. London & Stamford and Metric disclaim any obligation to update any forward looking or other statements contained herein, except as required by applicable law. Except as expressly provided in this announcement, no forward looking or other statements have been reviewed by the auditors of London & Stamford or Metric. All subsequent oral or written forward looking statements attributable to London & Stamford or Metric or any of their respective members, directors, officers or employees or any persons acting on their behalf are expressly qualified in their entirety by the cautionary statement above. Should one or more of these risks or uncertainties materialise, or should underlying assumptions prove incorrect, actual results may vary materially from those described in this announcement.
Disclosure requirements of the City Code
Under Rule 8.3(a) of the City Code, any person who is interested in one per cent. or more of any class of relevant securities of an offeree company or of any paper offeror (being any offeror other than an offeror in respect of which it has been announced that its offer is, or is likely to be, solely in cash) must make an Opening Position Disclosure following the commencement of the Offer Period and, if later, following the announcement in which any paper offeror is first identified. An Opening Position Disclosure must contain details of the person's interests and short positions in, and rights to subscribe for, any relevant securities of each of (i) the offeree company and (ii) any paper offeror(s). An Opening Position Disclosure by a person to whom Rule 8.3(a) applies must be made by no later than 3.30 p.m. (London time) on the 10th business day following the commencement of the Offer Period and, if appropriate, by no later than 3.30 p.m. (London time) on the 10th business day following the announcement in which any paper offeror is first identified. Relevant persons who deal in the relevant securities of the offeree company or of a paper offeror prior to the deadline for making an Opening Position Disclosure must instead make a Dealing Disclosure.
Under Rule 8.3(b) of the City Code, any person who is, or becomes, interested in one per cent. or more of any class of relevant securities of the offeree company or of any paper offeror must make a Dealing Disclosure if the person deals in any relevant securities of the offeree company or of any paper offeror. A Dealing Disclosure must contain details of the dealing concerned and of the person's interests and short positions in, and rights to subscribe for, any relevant securities of each of (i) the offeree company and (ii) any paper offeror, save to the extent that these details have previously been disclosed under Rule 8. A Dealing Disclosure by a person to whom Rule 8.3(b) applies must be made by no later than 3.30 p.m. (London time) on the Business Day following the date of the relevant dealing.
If two or more persons act together pursuant to an agreement or understanding, whether formal or informal, to acquire or control an interest in relevant securities of an offeree company or a paper offeror, they will be deemed to be a single person for the purpose of Rule 8.3.
Opening Position Disclosures must also be made by the offeree company and by any offeror and Dealing Disclosures must also be made by the offeree company, by any offeror and by any persons acting in concert with any of them (see Rules 8.1, 8.2 and 8.4).
Details of the offeree and offeror companies in respect of whose relevant securities Opening Position Disclosures and Dealing Disclosures must be made can be found in the Disclosure Table on the Panel's website at www.thetakeoverpanel.org.uk, including details of the number of relevant securities in issue, when the Offer Period commenced and when any offeror was first identified. You should contact the Panel's Market Surveillance Unit on +44 (0)20 7638 0129 if you are in any doubt as to whether you are required to make an Opening Position Disclosure or a Dealing Disclosure.
This summary should be read in conjunction with the full text of this announcement. The Merger will be subject to the Conditions and further terms set out in Appendix 1 to this announcement and to the full terms and conditions to be set out in the Scheme Document. Appendix 2 to this announcement contains further details of the sources of information and bases of calculations set out in this announcement, Appendix 3 contains a summary of the irrevocable undertakings received by London & Stamford (including those irrevocable undertakings given by the Metric Directors) and Appendix 4 contains definitions of certain expressions used in this summary and in this announcement.
Please be aware that addresses, electronic addresses and certain information provided by MetricShareholders, persons with information rights and other relevant persons for the receipt of communications from Metric may be provided to London & Stamford during the Offer Period as requested under Section 4 of Appendix 4 of the City Code to comply with Rule 2.12(c).
Publication on website and availability of hard copies
A copy of this announcement will be available free of charge, subject to certain restrictions relating to persons resident in Restricted Jurisdictions, on London & Stamford and Metric's websites at www.londonandstamford.com and www.metricproperty.co.uk, respectively, by no later than 12.00 p.m. on the Business Day following this announcement. Neither the contents of London & Stamford's website, nor those of Metric's website, nor those of any other website accessible from hyperlinks on either London & Stamford or Metric's website, are incorporated into or form part of this announcement.
You may request a hard copy of this announcement (and any information incorporated by reference in this announcement) by writing to Computershare Investor Services plc at The Pavilions, Bridgwater Road, Bristol, BS99 6ZZ or by calling 0870 889 3147 (or, if calling from outside the UK, on +44 870 889 3147). Calls cost approximately 8 pence per minute plus network extras, lines are open 9.00 a.m. - 5.30 p.m. Monday to Friday). It is important that you note that unless you make such a request, a hard copy of this announcement and any such information incorporated by reference in it will not be sent to you. You may also request that all future documents, announcements and information to be sent to you in relation to the Merger should be in hard copy form.
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APPENDIX 1
CONDITIONS AND CERTAIN FURTHER TERMS OF THE MERGER
Part A: The Conditions
1. The Merger will be conditional upon the Scheme becoming unconditional and becoming effective, subject to the City Code, by not later than 31 March 2013 or such later date (if any) as London & Stamford and Metric may, with the consent of the Panel, agree and (if required) the Court may allow.
2. The Scheme will be conditional upon:
(a) the approval of the Scheme by a majority in number representing 75 per cent. or more in value of the Scheme Shareholders entitled to vote and present and voting, either in person or by proxy, at the Metric Court Meeting (and at any separate class meeting which may be required by the Court or at any adjournment of any such meeting);
(b) all resolutions in connection with, or necessary to approve and implement the Scheme and Capital Reduction, as set out in the notice of the Metric General Meeting, being duly passed at the Metric General Meeting or at any adjournment of that meeting;
(c) any resolution or resolutions of London & Stamford Shareholders required to: (i) approve, effect and implement the Merger and (ii) confer authorities for the issue and allotment of the New Ordinary Shares to be issued in connection with the Merger, being duly passed at the London & Stamford General Meeting (or at any adjournment of that meeting) in each case by the requisite majority of London & Stamford Shareholders;
(d) the sanction of the Scheme and the confirmation of the Capital Reduction (in either case without modification, or with such modifications as are agreed by London & Stamford and Metric) by the Court and: (a) an office copy of the Court Order and the statement of capital attached thereto being delivered for registration to the Registrar of Companies and (b) if so ordered in order to take effect, the registration of the Court Order effecting the Capital Reduction and the statement of capital attached thereto by the Registrar of Companies; and
(e) the UK Listing Authority having acknowledged to London & Stamford or its agent (and such acknowledgement not having been withdrawn) that the application for the admission of the New Ordinary Shares to the Official List with a premium listing has been approved and (after satisfaction of any conditions to which such approval is expressed to be subject ("listing conditions")) will become effective as soon as a dealing notice has been issued by the FSA and any listing conditions having been satisfied and (ii) the London Stock Exchange having acknowledged to London & Stamford or its agent (and such acknowledgement not having been withdrawn) that the New Ordinary Shares will be admitted to trading.
3. In addition, subject as stated in Part B of this Appendix 1 and to the requirements of the Panel, the Merger will be conditional upon the following conditions and, accordingly, the Court Order(s) will not be delivered to the Registrar of Companies unless such conditions have been satisfied or, where relevant, waived in writing:
(a) no Third Party having intervened, and there not being outstanding any statute, regulation or order that would:
(i) make the Merger, its implementation or the acquisition or the proposed acquisition by London & Stamford or any member of the Wider London & Stamford Group of any shares or other securities in, or control or management of, Metric or any member of the Wider Metric Group void, illegal or unenforceable in any jurisdiction, or otherwise directly or indirectly restrain, prevent, prohibit, restrict, delay or otherwise materially adversely interfere with the same or impose additional conditions or obligations with respect to the Merger (or its implementation) or such acquisition, or otherwise impede, challenge or interfere with the Merger (or its implementation) or such acquisition, or require material adverse amendment to the terms of the Merger or the acquisition or proposed acquisition of any Metric Ordinary Shares or the acquisition of control or management of Metric or any member of the Wider Metric Group by London & Stamford or any member of the Wider London & Stamford Group;
(ii) materially limit or delay the ability of any member of the Wider London & Stamford Group or any member of the Wider Metric Group to acquire or to hold or to exercise effectively, directly or indirectly, all or any rights of ownership in respect of shares or other securities (or the equivalent) in, or to exercise voting or management control over, any member of the Wider Metric Group or any member of the Wider London & Stamford Group, as the case may be, taken as a whole;
(iii) require, prevent or materially delay any divestiture or alter the terms envisaged for any proposed divestiture by any member of the Wider London & Stamford Group of any shares or other securities in Metric or any member of the Wider Metric Group (in any case to an extent which is or reasonably likely to be material in the context of the Wider London & Stamford Group or the Wider Metric Group, as the case may be, taken as a whole);
(iv) require, prevent or materially delay any divestiture or alter the terms envisaged for any proposed divestiture by any member of the Wider London & Stamford Group or by any member of the Wider Metric Group of all or any part of their respective businesses, assets or properties or limit the ability of any of them to conduct all or any part of their respective businesses or to own or control any of their respective assets or properties or any part thereof (in any case to an extent which is or is reasonably likely to be material in the context of the Wider London & Stamford Group or the Wider Metric Group, as the case may be, taken as a whole);
(v) other than in connection with the implementation of the Merger, require any member of the Wider London & Stamford Group or of the Wider Metric Group to subscribe for or acquire, or to offer to subscribe for or acquire, any shares or other securities (or the equivalent) or interest in any member of the Wider Metric Group or the Wider London & Stamford Group;
(vi) materially limit the ability of any member of the Wider London & Stamford Group or of the Wider Metric Group to integrate or co-ordinate its business, or any part of it, with the businesses or any part of the businesses of any other member of the Wider London & Stamford Group and/or of the Wider Metric Group in each case in a manner which is material in the context of the Merger, or as the case may be, in the context of the Wider London & Stamford Group or the Wider Metric Group, as the case may be, taken as a whole;
(vii) result in any member of the Wider London & Stamford Group or the Wider Metric Group ceasing to be able to carry on business under any name under which it presently does so (in any case to an extent which is material in the context of the Wider London & Stamford Group or the Wider Metric Group, as the case may be, taken as a whole); or
(viii) otherwise adversely affect the business, assets, profits, financial or trading position or prospects of any member of the Wider London & Stamford Group to a material extent, or, of the Wider Metric Group, taken as a whole, to a material extent;
and all applicable waiting and other time periods during which any such Third Party could decide to take, institute, implement or threaten such actions, proceedings, suit, investigation, enquiry or reference or take any other step under any applicable legislation or regulation of any relevant jurisdiction having expired, lapsed or been terminated (as the case may be);
(b) all material notifications, filings and/or applications which are necessary having been made, all appropriate waiting and other time periods (including any extensions of such waiting and other time periods) under any applicable legislation or regulation of any relevant jurisdiction having expired, lapsed or terminated (as appropriate) and all statutory or regulatory obligations in any relevant jurisdiction having been complied with, in each case in connection with the Merger or the acquisition or proposed acquisition of any shares or other securities in, or control of, Metric or any other member of the Wider Metric Group by any member of the Wider London & Stamford Group or the carrying on by any member of the Wider Metric Group of its business;
(c) all Authorisations which are necessary in any relevant jurisdiction for or in respect of the Merger (or its implementation) or the acquisition or proposed acquisition of any shares or other securities in, or control or management of, Metric or any other member of the Wider Metric Group by London & Stamford or any member of the Wider London & Stamford Group or the carrying on by any member of the Wider Metric Group of its business having been obtained, in terms and in a form satisfactory to London & Stamford from all appropriate Third Parties or from any persons or bodies with whom any member of the Wider London & Stamford Group or any member of the Wider Metric Group has entered into contractual arrangements and such Authorisations together with all authorisations necessary for any member of the Wider Metric Group to carry on its business remaining in full force and effect, and there being no notice or other intimation of any intention to revoke, suspend, restrict, modify or not to renew any of the same having been made in connection with the Merger or any other matter directly, or indirectly, arising from the Merger (or its implementation), in each case where the absence of such Authorisation would have a material adverse effect on the Wider Metric Group or the Wider London & Stamford Group taken as a whole and all necessary statutory or regulatory obligations in any relevant jurisdiction having been complied with;
(d) save as Disclosed, there being no provision of any arrangement, agreement, lease, licence, permit, franchise or other instrument to which any member of the Wider Metric Group, or the Wider London & Stamford Group, as appropriate, is a party, or by or to which any such member or any of its assets is or may be bound, entitled or subject, or any circumstance, which, in each case as a consequence of the Merger (or its implementation) or of the resignation of an London & Stamford Director or the acquisition or proposed acquisition by London & Stamford or any member of the Wider London & Stamford Group or otherwise of any shares or other securities (or the equivalent) in, or control or management of, Metric or any other member of the Wider Metric Group, could reasonably be expected to result in, in any case to an extent which is or would be material in the context of the Wider Metric Group or the Wider London & Stamford Group, as appropriate, in each case taken as a whole:
(i) any monies borrowed by or any other indebtedness or liabilities (actual or contingent) of, or any grant available to, any member of the Wider Metric Group, or the Wider London & Stamford Group, as appropriate, being or becoming repayable or being capable of being declared repayable immediately or prior to their or its stated maturity or the ability of any member of the Wider Metric Group, or the Wider London & Stamford Group, as appropriate, to borrow monies or incur any indebtedness being withdrawn or inhibited or becoming capable of being withdrawn or inhibited;
(ii) the creation or enforcement of any mortgage, charge or other security interest over the whole or any part of the business, property, assets or interests of any member of the Wider Metric Group or the Wider London & Stamford Group, as appropriate, or any such mortgage, charge or other security interest (wherever and whenever created, arising or having arisen) becoming enforceable;
(iii) any such arrangement, agreement, lease, licence, permit, franchise or instrument, or the rights, liabilities, obligations or interests of any member of the Wider Metric Group, or the Wider London & Stamford Group, as appropriate, thereunder, being, or becoming capable of being, terminated or adversely modified or affected or any adverse action being taken or arising thereunder or any onerous obligation or liability arising thereunder;
(iv) any asset or interest of any member of the Wider Metric Group or any asset the use of which is enjoyed by any member of the Wider Metric Group being or falling to be disposed of or charged or ceasing to be available to any member of the Wider Metric Group 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 member of the Wider Metric Group otherwise than in the ordinary course of business;
(v) the creation or assumption of any liabilities (actual or contingent) by any member of the Wider Metric Group, or the Wider London & Stamford Group, as appropriate, other than in the ordinary course of business;
(vi) the rights, liabilities, obligations or interests of any member of the Wider Metric Group, or the Wider London & Stamford Group, as appropriate, under any such arrangement, agreement, lease, licence, permit, franchise or other instrument or the interests or business of any such member in or with any other person, firm, company or body (or any agreements or arrangements relating to any such interests or business) being terminated, adversely modified or affected;
(vii) the financial or trading position or the value or the profits of Metric or of any member of the Wider Metric Group, or the Wider London & Stamford Group, as appropriate, being prejudiced or adversely affected;
(viii) the creation of any liability (actual or contingent) by any member of the Wider Metric Group, or the Wider London & Stamford Group, as appropriate,; or
(ix) any member of the Wider Metric Group, or the Wider London & Stamford Group, as appropriate, being required to acquire or repay any shares in and/or indebtedness of any member of the Wider Metric Group owned by or owed to any third party;
and no event having occurred which, under any provision of any such arrangement, agreement, lease, license, permit, franchise or other instrument to which any member of the Wider Metric Group, or the Wider London & Stamford Group, as appropriate, is a party, or by or to which any such member or any of its assets may be found entitled or subject, could result in any of the events or circumstances which are referred to in paragraphs (i) to (ix) of this condition 3(d) in any case to an extent which is or would be material in the context of the Wider Metric Group as a whole;
(e) save as Disclosed, no member of the Wider Metric Group, or the Wider London & Stamford Group, as appropriate, having since 30 September 2012:
(i) issued or agreed to issue, or authorised or proposed or announced its intention to authorise or propose the issue of, additional shares or securities of any class, or securities convertible into or exchangeable for, or rights, warrants or options to subscribe for or acquire, any such shares or convertible securities (save as between Metric and wholly-owned subsidiaries of Metric, between London & Stamford and wholly-owned subsidiaries of London & Stamford);
(ii) purchased or redeemed or repaid or proposed the purchase, redemption or repayment of any of its own shares or other securities (or the equivalent) or reduced or, save in respect of the matters mentioned in sub-paragraph (i) above made or authorised any other change to any part of its share capital other than pursuant to the implementation of the Merger;
(iii) recommended, declared, paid or made or proposed to recommend, declare, pay or make any bonus issue, dividend or other distribution, whether payable in cash or otherwise save for the Interim Dividend and any dividend ("Permitted Dividend") declared before the Effective Date by any wholly-owned subsidiary of Metric or London & Stamford to Metric or London & Stamford or any of their respective wholly-owned subsidiaries;
(iv) save for transactions between Metric or London & Stamford and their respective wholly-owned subsidiaries or between such wholly-owned subsidiaries, made, authorised, proposed or announced an intention to make, propose or authorise any change in its loan capital;
(v) save for transactions between Metric or London & Stamford and their respective wholly-owned subsidiaries or between such wholly-owned subsidiaries merged with, demerged or acquired any body corporate, partnership or business or acquired or disposed of or transferred, mortgaged or charged or created any security interest over any material assets or any right, title or interest in any material assets (including shares in any undertaking and trade investments) or authorised, proposed or announced the same;
(vi) issued, authorised or proposed or announced an intention to authorise or propose the issue of, or made any change in or to, any debentures or, other than trade credit incurred in the ordinary course of business, incurred or increased any indebtedness or liability (actual or contingent) except as between Metric or London & Stamford and any of their respective wholly owned subsidiaries or between such subsidiaries, which in any case is material in the context of the Wider Metric Group taken as a whole or the Wider London & Stamford Group taken as a whole, as appropriate;
(vii) entered into, varied, authorised, proposed or announced an intention to enter into or vary any contract, agreement, transaction, arrangement or commitment (whether in respect of capital expenditure or otherwise) which:
(a) is of a long term, onerous or unusual nature or magnitude or which involves or is or is reasonably likely to involve an obligation of such a nature or magnitude;
(b) restricts or could reasonably be expected to restrict the business of any member of the Wider Metric Group or the Wider London & Stamford Group; or
(c) is other than in the ordinary course of business,
and which is, in any such case, material in the context of the Wider Metric Group taken as a whole or the Wider London & Stamford Group, taken as a whole, as appropriate;
(viii) entered into, implemented, effected or authorised any merger, demerger, reconstruction, amalgamation, scheme, commitment or other transaction or arrangement in respect of itself or another member of the Wider Metric Group or the Wider London & Stamford Group;
(ix) entered into or varied or made an offer (which remains open for acceptance) to vary the terms of any contract, agreement, commitment or arrangement with any of the directors or senior executives of any member of the Wider Metric Group or the Wider London & Stamford Group, as appropriate, or changed or entered into any commitment to change the terms of any of the Metric Share Schemes or the Existing Management Incentive Agreement, as appropriate, save for salary increases and bonuses not resulting in total annual remuneration of any individual exceeding the immediately preceding year's remuneration by more than three per cent. or other bonuses or variations of terms in the ordinary course of business which are not material in the context of the Wider Metric Group taken as a whole;
(x) taken any corporate action or had any step, application, filing in court, notice or legal proceedings started, served, instituted or threatened against it or petition presented or order made for its winding-up (voluntarily or otherwise), dissolution or reorganisation or for the appointment of a receiver, administrator, administrative receiver, trustee or similar officer of all or any material part of its assets and revenues or any analogous proceedings in any jurisdiction which in any case is material in the context of the Wider Metric Group taken as a whole;
(xi) been unable, or admitted in writing that it is unable, to pay its debts or having stopped or suspended (or threatened to stop or suspend) payment of its debts generally or having entered into or taken steps to enter into a moratorium, composition, compromise or arrangement with its creditors in respect of its debts or ceased or threatened to cease carrying on all or a substantial part of its business;
(xii) waived, settled or compromised any claim (other than in the ordinary and usual course of business) to an extent which is material in the context of the Wider Metric Group taken as a whole or the Wider London & Stamford Group, taken as a whole, as appropriate;
(xiii) terminated or varied the terms of any agreement or arrangement between any member of the Wider Metric Group or the Wider London & Stamford Group, as appropriate, and any other person in a manner which would or might reasonably be expected to have a material adverse effect on the financial position or prospects of the Wider Metric Group or the Wider London & Stamford Group, as appropriate,;
(xiv) made any alteration to its articles of association other than as required to implement the Merger;
(xv) put in place any pension schemes for its directors, employees or their dependants or made or agreed or consented to any change to:
(a) the terms of the trust deeds constituting the pension schemes (if any) established for its directors, employees or their dependants; or
(b) the benefits which accrue, or to the pensions which are payable, thereunder; or
(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 made,
or agreed or consented to any change to the trustees involving the appointment of a trust corporation;
(xvi) proposed, agreed to provide or modified the terms of any share option scheme, incentive scheme or other benefit relating to the employment or termination of employment of any person employed by the Wider Metric Group or the Wider London & Stamford Group, as appropriate, in a manner which is material in the context of the Wider Metric Group taken as a whole or the Wider London & Stamford Group, taken as a whole, as appropriate,; or
(xvii) entered into any contract, agreement, commitment or arrangement or passed any resolution or made any offer (which remains open for acceptance) or proposed or announced any intention with respect to any of the transactions, matters or events referred to in this condition (e);
(f) since 30 September 2012, save as Disclosed:
(i) no adverse change or deterioration having occurred in the business, assets, financial or trading position or profits or prospects of any member of the Wider Metric Group or the Wider London & Stamford Group, as appropriate, which in any case is material in the context of the Wider Metric Group taken as a whole;
(ii) no litigation, arbitration proceedings, prosecution or other legal proceedings to which any member of the Wider Metric Group is or may become a party (whether as plaintiff, defendant or otherwise) having been threatened, announced, implemented or instituted by or against or remaining outstanding against or in respect of any member of the Wider Metric Group or the Wider London & Stamford Group, as appropriate, which in any case is material in the context of the Wider Metric Group taken as a whole or the Wider London & Stamford Group, taken as a whole, as appropriate,;
(iii) no enquiry or investigation by, or complaint or reference to, any Third Party having been threatened, announced, implemented, instituted by or against or remaining outstanding against or in respect of any member of the Wider Metric Group which in any such case might reasonably be excepted to be material in the context of the Wider Metric Group taken as a whole;
(iv) no contingent or other liability having arisen or become apparent to any member of the London & Stamford Group or increased which might reasonably be expected to adversely affect any member of the Wider Metric Group which is material in the context of the Wider Metric Group taken as a whole and no contingent or other liability having arisen or become apparent to any member of the Metric Group or increased which might reasonably be expected to adversely affect any member of the Wider London & Stamford Group which is material in the context of the Wider London & Stamford Group, taken as a whole;
(v) no claim being made and no circumstance having arisen which might reasonably be expected to lead to a claim being made under the insurance of any member of the Wider Metric Group or the Wider London & Stamford Group, as appropriate, where such claim would not be covered by such insurance and where such claim is material in the context of the Wider Metric Group taken as a whole or the Wider London & Stamford Group, taken as a whole, as appropriate,; and
(vi) no steps having been taken which are reasonably likely to result in the withdrawal, cancellation or termination or modification of any licence, permit or consent held by any member of the Wider Metric Group which is necessary for the proper carrying on by such member of its business and which is material in the context of the Wider Metric Group or the Wider London & Stamford Group, as appropriate,;
(g) London & Stamford not having discovered (other than to the extent Disclosed):
(vii) that any financial or business or other information concerning the Wider Metric Group disclosed at any time by or on behalf of any member of the Wider Metric Group, whether publicly, to any member of the Wider London & Stamford Group or otherwise, is materially misleading or contains any material misrepresentation of fact or omits to state a fact necessary to make any information contained therein not materially misleading;
(viii) that any member of the Wider Metric Group is subject to any liability (actual or contingent) which is material in the context of the Wider Metric Group taken as a whole; or
(ix) any information which affects the import of any information disclosed to London & Stamford at any time by or on behalf of any member of the Wider Metric Group to an extent which is material and adverse in the context of the Wider Metric Group taken as a whole;
(h) save as Disclosed, London & Stamford not having discovered that:
(x) any past or present member of the Wider Metric Group has failed to comply with any applicable legislation, regulations or common law of any jurisdiction or any notice, order or requirement of any Third Party with regard to the use, treatment, handling, storage, transport, release, disposal, discharge, presence, spillage, leak or emission of any waste or hazardous or harmful substance or any substance likely to impair the environment or harm human or animal health, or otherwise relating to environmental matters or the health and safety of any person, or that there has otherwise been any such use, treatment, handling, storage, transport, release, disposal, discharge, presence, spillage, leak or emission (whether or not the same constituted non-compliance by any person with any legislation, regulations or law and wherever the same may have taken place) which, in any case, would be reasonably likely to give rise to any liability (whether actual or contingent) or cost on the part of any member of the Wider Metric Group which in any case is material in the context of the Wider Metric Group taken as a whole; or
(xi) there is, or is reasonably likely to be, any obligation or liability, whether actual or contingent, to make good, repair, reinstate, remedy or clean up any property now or previously owned, occupied, operated or made use of or controlled by any past or present member of the Wider Metric Group or any other property or controlled waters under any environmental legislation, regulation, common law, notice, circular, order or other lawful requirement of any relevant authority or Third Party in any jurisdiction or otherwise which in any case is material in the context of the Wider Metric Group taken as a whole;
(i) Metric not having discovered (other than to the extent Disclosed):
(xii) that any financial or business or other information concerning the Wider London & Stamford Group disclosed at any time by or on behalf of any member of the Wider London & Stamford Group, whether publicly, to any member of the Wider Metric Group or otherwise, is materially misleading or contains any material misrepresentation of fact or omits to state a fact necessary to make any information contained therein not materially misleading;
(xiii) that any member of the Wider London & Stamford Group is subject to any liability (actual or contingent) which is material in the context of the Wider London & Stamford Group taken as a whole; or
(xiv) any information which affects the import of any information disclosed to Metric at any time by or on behalf of any member of the Wider London & Stamford Group to an extent which is material and adverse in the context of the Wider London & Stamford Group taken as a whole; or
(j) save as Disclosed, Metric not having discovered that:
(xv) any past or present member of the Wider London & Stamford Group has failed to comply with any applicable legislation, regulations or common law of any jurisdiction or any notice, order or requirement of any Third Party with regard to the use, treatment, handling, storage, transport, release, disposal, discharge, presence, spillage, leak or emission of any waste or hazardous or harmful substance or any substance likely to impair the environment or harm human or animal health, or otherwise relating to environmental matters or the health and safety of any person, or that there has otherwise been any such use, treatment, handling, storage, transport, release, disposal, discharge, presence, spillage, leak or emission (whether or not the same constituted non-compliance by any person with any legislation, regulations or law and wherever the same may have taken place) which, in any case, would be reasonably likely to give rise to any liability (whether actual or contingent) or cost on the part of any member of the Wider London & Stamford Group which in any case is material in the context of the Wider London & Stamford Group taken as a whole; or
(xvi) there is, or is reasonably likely to be, any obligation or liability, whether actual or contingent, to make good, repair, reinstate, remedy or clean up any property now or previously owned, occupied, operated or made use of or controlled by any past or present member of the Wider London & Stamford Group or any other property or controlled waters under any environmental legislation, regulation, common law, notice, circular, order or other lawful requirement of any relevant authority or Third Party in any jurisdiction or otherwise which in any case is material in the context of the Wider London & Stamford Group taken as a whole;
Part B: Waiver of Conditions and further terms of the Merger and the Scheme
1. Subject to the requirements of the Panel or, if required, by the Court, London & Stamford reserves the right to waive all or any of the above conditions in paragraph 3 of Part A above, in whole or in part, except those conditions which relate to the Wider London & Stamford Group and Metric reserves the right to waive all or any of the above conditions in paragraph 3 of Part A above, except those conditions which relate to Metric or the Wider Metric Group. The Scheme will not become effective unless the Conditions have been fulfilled or (if capable of waiver) waived or where appropriate, have been determined by London & Stamford to be or remain satisfied by no later than the date referred to in condition 1 (or such later date as London & Stamford, Metric, the Panel and, if required, the Court may allow).
2. London & Stamford shall be under no obligation to waive (if capable of waiver), to determine to be or remain satisfied or to treat as fulfilled any of the conditions in paragraphs 3(a) to 3(h) (inclusive) by a date earlier than the latest date of the fulfilment of that condition notwithstanding that the other conditions to the Merger may at such earlier date have been waived or fulfilled and that there are at such earlier date no circumstances indicating that any such conditions may not be capable of fulfilment.
3. London & Stamford reserves the right to elect (with Metric's consent in writing) to implement the Merger by way of a Takeover Offer (subject to the Panel's consent). In such event, such offer will be implemented on the same terms and conditions (subject to appropriate amendments, including (without limitation) an acceptance condition set at ninety per cent. (or such lower percentage (being more than 50 per cent.) as London & Stamford may decide (subject to the Panel's consent)) of the shares to which such offer relates), so far as applicable, as those which would apply to the Scheme (the "General Offer Acceptance Condition").
4. Metric Ordinary Shares will be acquired pursuant to the Merger 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, or made on or after the date of this announcement, save the Interim Dividend.
5. Under Rule 13.5 of the City Code, London & Stamford may only invoke a condition to the Merger so as to cause the Merger not to proceed, to lapse or to be withdrawn where the circumstances which give rise to the right to invoke the condition are of material significance to London & Stamford in the context of the Merger. The conditions contained in paragraphs 1 and 2 of Part A of this Appendix 1 are not subject to this provision of the City Code.
6. The Merger and the Scheme are and will be governed by English law and will be subject to the exclusive jurisdiction of the English courts.
7. The availability of the Merger to persons not resident in the United Kingdom may be affected by the laws of the relevant jurisdictions. Persons who are not resident in the United Kingdom should inform themselves about and observe any applicable requirements. Further details in relation to overseas shareholders will be contained in the Scheme Document.
8. The Merger is not being made, directly or indirectly, in, into or from, or by use of the mails of, or by any means of instrumentality (including, but not limited to, facsimile, e-mail or other electronic transmission, telex or telephone) of interstate or foreign commerce of, or of any facility of a national, state or other securities exchange of, any jurisdiction where to do so would violate the laws of that jurisdiction.
9. If any dividend (other than a Permitted Dividend or the Interim Dividend) or other distribution or return of capital is proposed, declared, made, paid or becomes payable by Metric in respect of a Metric Ordinary Share on or after the date of this announcement and prior to the Merger becoming Effective, London & Stamford reserves the right to reduce the value of the consideration payable for each Metric Ordinary Share under the Merger by up to the amount per Metric Ordinary Share of such dividend, distribution or return of capital except where the Metric Ordinary Share is or will be acquired pursuant to the Merger on a basis which entitles London & Stamford to receive the dividend and/or distribution and/or return of capital and to retain it. London & Stamford also reserves the right, with Panel consent, to reduce the value of the consideration payable for each Metric Ordinary Share under the Merger and/or to adjust the Merger Ratio.
10. Fractions of New Ordinary Shares will not be allotted or issued to Scheme Shareholders, but the entitlements of Scheme Shareholders will be rounded up or down (with 0.5 being rounded up) to the nearest whole number of New Ordinary Shares.
11. For the purpose of these conditions:
(b) a Third Party shall be regarded as having "intervened" if it has instituted or implemented any action, proceeding, suit, investigation, enquiry or reference or has made or enacted any statute, regulation, decision, or order and "intervene" shall be construed accordingly; and
(c) "Disclosed" shall mean: (i) in relation to information disclosed by Metric to London & Stamford, any information fairly disclosed in writing prior to the date hereof by or on behalf of Metric to London & Stamford, or its financial, accounting, taxation or legal advisers (specifically as London & Stamford's advisers in relation to the Merger); and (ii) in relation to information disclosed by London & Stamford to Metric, any information fairly disclosed in writing prior to the date hereof by or on behalf of London & Stamford to Metric, or its financial, accounting, taxation or legal advisers (specifically as Metric's advisers in relation to the Merger).
APPENDIX 2
BASES AND SOURCES
1. The value of £209.0 million attributed to the issued and to be issued share capital of Metric is based upon the 190,000,000 Metric Ordinary Shares in issue on 8 November 2012 and the 110,706 Metric Ordinary Shares which may be issued based on the expected vesting of options under the Metric Share Schemes if the Merger becomes Effective.
2. Unless otherwise stated, the financial information relating to London & Stamford is extracted from the:
· audited consolidated financial statements of the London & Stamford Group for the year ended 31 March 2012; and
· unaudited consolidated interim financial statements contained in the interim results of the London & Stamford Group for the period ended 30 September 2012.
3. Unless otherwise stated, the financial information relating to Metric is extracted from the:
· audited consolidated financial statements of Metric Group for the year ended 31 March 2012; and
· unaudited consolidated interim financial statements contained in the interim results of the Metric Group for the period ended 30 September 2012.
4. Unless otherwise stated, all prices for Metric Ordinary Shares have been derived from the Daily Official List of the London Stock Exchange and represent closing middle market prices on the relevant date.
5. All share prices expressed in pence have been rounded to the nearest pence and all percentages have been rounded to a whole number (other than percentages in Appendix 3 and paragraphs 5 and 7 of the announcement).
6. The premia implied by the terms of the Merger has been calculated with reference to:
· the exchange ratio of 0.94 New Ordinary Shares for each Metric Ordinary Share held and the Closing Price per Ordinary Share of 117 pence on 5 November 2012 (being the last practicable date prior to the commencement of the Offer Period);
· the Closing Price per Metric Ordinary Share of 93 pence on 5 November 2012 (being the last practicable date prior to the commencement of the Offer Period); and
· the six-month average price per Metric Ordinary Share of 93 pence (being the average Closing Price for the six-month period ended on 5 November 2012 being the last practicable date prior to the commencement of the Offer Period).
APPENDIX 3
DETAILS OF IRREVOCABLE UNDERTAKINGS
PART A
Irrevocable undertakings in respect of Metric Ordinary Shares
The following Metric Directors have given irrevocable undertakings in respect of their entire beneficial holdings of Metric Ordinary Shares to vote in favour of the Scheme at the Metric Court Meeting and vote in favour of the Metric Resolution to be proposed at the Metric General Meeting, amounting in aggregate to 6,101,914 Metric Ordinary Shares, representing approximately 3.21 per cent. of Metric's existing issued ordinary share capital:
|
Name |
Number of Metric Ordinary Shares |
Percentage of issued share capital of Metric |
|
Andrew Jones |
2,055,720 |
1.08 |
|
Valentine Beresford |
2,109,693 |
1.11 |
|
Mark Stirling |
1,534,693 |
0.81 |
|
Sue Ford |
76,808 |
0.04 |
|
Andrew Huntley |
100,000 |
0.05 |
|
Alec Pelmore |
75,000 |
0.04 |
|
Andrew Varley |
50,000 |
0.03 |
|
Philip Watson |
100,000 |
0.05 |
Each of the irrevocable commitments described above will cease to be binding on the earlier of the following occurrences:
· London & Stamford announcing, with the consent of the Panel, that it does not intend to proceed with the Merger and no new, revised or replacement offer is announced by London & Stamford in accordance with Rule 2.7 of the City Code at the same time; or
· a condition to the Scheme is invoked or it fails to become Effective by 31 March 2013 and no new, revised or replacement offer or Scheme has then been announced in its place in accordance with Rule 2.7 of the City Code, or is announced by London & Stamford in accordance with Rule 2.7 of the City Code within five business days.
PART B
Irrevocable undertakings in respect of Ordinary Shares
The following Directors have given irrevocable undertakings in respect of their entire beneficial holdings of Ordinary Shares to vote in favour of the resolutions to be proposed at the London & Stamford General Meeting to the extent that they are permitted to vote on such resolutions, amounting in aggregate to 40,212,932 Ordinary Shares, representing approximately 7.41 per cent. of London & Stamford's existing issued ordinary share capital:
|
Name |
Number of Ordinary Shares |
Percentage of issued share capital of London & Stamford |
|
Raymond Mould |
16,000,000 |
2.95 |
|
Patrick Vaughan |
18,146,010 |
3.34 |
|
Martin McGann |
3,823,795 |
0.70 |
|
Humphrey Price |
2,143,127 |
0.39 |
|
Richard Crowder |
100,000 |
0.02 |
No provisions have been included in the undertakings listed in this Part B which provide for the cessation of the obligations of the relevant London & Stamford Shareholders arising thereunder.
APPENDIX 4
DEFINITIONS
The following definitions apply throughout this announcement unless the context requires otherwise.
|
"Admission" |
admission of the New Ordinary Shares to the premium listing segment of the Official List and to trading on the Main Market; |
|
"AIM" |
the AIM market operated by the London Stock Exchange;
|
|
"Arlington" |
Supertwice Services Limited, formerly named Arlington Securities Plc (registered in England and Wales under company no. 1277236) whose registered office is PO Box 695, 8 Salisbury Square, London, EC4Y 8BB; |
|
"Authorisations" |
authorisations, orders, grants, recognitions, determinations, certificates, confirmations, consents, licences, clearances, provisions, permissions and approvals; |
|
"Board" or "London & Stamford Board" |
the board of directors of London & Stamford as at the date of this announcement; |
|
"Business Day" |
a day on which banks are generally open for business in London (excluding Saturdays, Sundays and public holidays); |
|
"Capital Reduction" |
the reduction of Metric's share capital provided for by the Scheme; |
|
"City Code" |
the City Code on Takeovers and Mergers; |
|
"Closing Price" |
the closing middle market price of a Metric Ordinary Share or Ordinary Share, as the context so requires, on a particular trading day as derived from the London Stock Exchange Daily Official List; |
|
"Combined Circular and Prospectus" |
the combined circular and prospectus to be published by London & Stamford and to be sent to London & Stamford Shareholders and Metric Shareholders outlining, amongst other things, the Merger and containing the notice convening the London & Stamford General Meeting and information on London & Stamford, the Enlarged Group and the New Ordinary Shares; |
|
"Companies Act" |
Companies Act 2006;
|
|
"Company" or " London & Stamford " |
London & Stamford Property Plc;
|
|
"Conditions" |
the conditions to the Merger as set out in Appendix 1 to this announcement; |
|
"Court" |
the High Court of Justice in England and Wales; |
|
"Court Order" |
the order of the Court sanctioning the Scheme under section 899 of the Companies Act and confirming the Capital Reduction under section 648 of the Companies Act;
|
|
"Credit Suisse" |
Credit Suisse Securities (Europe) Limited (registered in England and Wales under company number 00891554) whose registered office is One Cabot Square, London, E14 4QS;
|
|
"CREST" |
the system for the paperless settlement of trades in securities and the holding of uncertificated securities in accordance with the CREST Regulations;
|
|
"Daily Official List" |
the daily official list of the London Stock Exchange; |
|
"Dealing Disclosure" |
has the same meaning as in Rule 8 of the City Code;
|
|
"Directors" |
the directors of the Company as at the date of this announcement; |
|
"Effective" |
the Merger and the Scheme becoming effective in accordance with their terms; |
|
"Effective Date" |
the date on which the Merger becomes Effective; |
|
"Eligible Shareholders" |
London & Stamford Shareholders (subject to certain exceptions) immediately following the Effective Date other than Restricted Overseas Persons;
|
|
"Enlarged Company" |
London & Stamford immediately following the Merger becoming Effective;
|
|
"Enlarged Group" |
London & Stamford and its subsidiaries, including Metric following completion of the Proposals; |
|
"Enlarged Share Capital" |
all of the issued Ordinary Shares at the date immediately following the Merger becoming Effective;
|
|
"EPRA" |
European Public Real Estate Association; |
|
"EPRA NAV" |
an NAV calculated in accordance with the guidelines issued by EPRA from time to time;
|
|
"Executive Committee" |
the executive directors of the Enlarged Company, Valentine Beresford and Mark Stirling; |
|
"Existing Incentive Shares" |
the 6,244,796 Ordinary Shares issued by London & Stamford pursuant to the terms of the Existing Management Incentive Agreement which are subject to the clawback provisions of same; |
|
"Existing Incentive Shares Cancellation" |
the purchase and cancellation by London & Stamford of the Existing Incentive Shares pursuant to the Existing Management Incentives Termination Agreement;
|
|
"Existing Management Incentive Agreement" |
the agreement dated 11 August 2010 between London & Stamford and the Participating Management Members in relation to the acquisition of the entire issued share capital of LSI Management Limited by London & Stamford; |
|
"Existing Management Incentives Termination Agreement" |
the agreement to be entered into between London & Stamford and the Participating Management Members, pursuant to which the parties agree to terminate certain clawback provisions of the Existing Management Incentive Agreement; |
|
"Forms of Proxy" |
the forms of proxy accompanying the Scheme Document;
|
|
"FSA" |
the Financial Services Authority;
|
|
"GEPT" |
General Electric Pension Trust;
|
|
"Hearing Record Time" |
6.00 p.m. on the Business Day immediately preceding the Scheme Court Hearing Date;
|
|
"Independent London & Stamford Directors" |
the London & Stamford Directors who are not Former LSI Management Members; |
|
"J.P. Morgan Cazenove" |
J.P. Morgan Limited which conducts its UK investment banking activities as J.P. Morgan Cazenove; |
|
"Listing Rules" |
the rules and regulations made by the FSA in its capacity as the UK Listing Authority under the Financial Services and Markets Act 2000, and contained in the UK Listing Authority's publication of the same name; |
|
"London & Stamford General Meeting" |
the general meeting of London & Stamford convened by the Board and expected to be held on or around December 2012;
|
|
"London & Stamford Group" |
London & Stamford and its subsidiary undertakings and, where the context permits, each of them; |
|
"London & Stamford Interim Dividend" |
the interim dividend of 3.5 pence for each Ordinary Share payable by London & Stamford to Shareholders who are on London & Stamford's register of members as at 23 November 2012; |
|
"London & Stamford Shareholders" |
the holders of Ordinary Shares; |
|
"London Stock Exchange" |
London Stock Exchange plc;
|
|
"Main Market" |
the London Stock Exchange's main market for listed securities;
|
|
"Meadowhall" |
the property at Meadowhall Centre, Sheffield S9 1EP;
|
|
"Merger" |
the direct or indirect acquisition of the entire issued and to be issued share capital of Metric by London & Stamford (other than Metric Ordinary Shares already held by the London & Stamford Group) to be implemented by way of the Scheme or (should London & Stamford so elect, subject to the consent of the Panel (where necessary) and with Metric's prior written consent) by way of a Takeover Offer; |
|
"Merger Ratio" |
means the ratio of 0.94 New Ordinary Shares for each Metric Ordinary Share;
|
|
"Metric" |
Metric Property Investments plc;
|
|
"Metric Board" |
the board of directors of Metric as at the date of this announcement;
|
|
"Metric Court Meeting" |
the meeting of the Scheme Shareholders to be convened by order of the Court pursuant to section 896 of the Companies Act, for the purpose of approving the Scheme, including any adjournment thereof;
|
|
"Metric Directors" |
the directors of the Metric as at the date of this announcement;
|
|
"Metric Existing Ordinary Shares" |
the existing issued ordinary shares of one penny each in the capital of Metric as at 8 November 2012;
|
|
"Metric General Meeting" |
the general meeting of Metric to be convened by the Metric Directors and expected to be held in late December 2012 immediately following the Metric Court Meeting;
|
|
"Metric Group" |
Metric and its subsidiary undertakings and, where the context permits, each of them;
|
|
"Metric Interim Dividend" |
the interim dividend of 1.8 pence for each Metric Ordinary Share payable by Metric to Metric Shareholders who are on Metric's register of members as at 23 November 2012; |
|
"Metric Ordinary Shares" |
ordinary shares of one penny each in the capital of Metric;
|
|
"Metric Resolution" |
the special resolution to be proposed at the Metric General Meeting in connection with the Scheme;
|
|
"Metric Share Schemes"
|
(i) the Metric Property Investments plc Matching Share Plan; (ii) the Metric Property Investments plc Management Incentive Plan; and (iii) the Metric Property Investments plc Company Share Option Plan;
|
|
"Metric Shareholders" |
registered holders of Metric Ordinary Shares from time to time;
|
|
"Metric Shareholder Meetings" |
the Metric Court Meeting and the Metric General Meeting, and "Metric Shareholder Meeting" shall be construed accordingly; |
|
"NAV" or "Net Asset Value" |
the value of the assets of the London & Stamford Group or the Enlarged Group, as applicable, less its liabilities, determined in accordance with the accounting principles adopted by the London & Stamford Group or the Enlarged Group, as applicable, from time to time or, as the context requires, the net asset value per ordinary share calculated in accordance with London & Stamford's accounting policies;
|
|
"New Metric Shares" |
the ordinary shares of one penny each in the capital of Metric to be issued to London & Stamford in accordance with the terms of the Scheme; |
|
"New Ordinary Share" |
the Ordinary Shares to be issued in connection with the Scheme;
|
|
"Offer Period" |
the offer period (as defined by the City Code) relating to Metric, which commenced on 6 November 2012;
|
|
"Official List" |
the Official List of the UK Listing Authority; |
|
"Opening Position Disclosure" |
has the same meaning as in Rule 8 of the City Code;
|
|
"Ordinary Shares" |
the ordinary shares of 10 pence each in the capital of London & Stamford;
|
|
"Oriel Securities" |
Oriel Securities Limited (a limited company incorporated in England and Wales with registered number 04373759) whose registered office is 150 Cheapside, London, EC2V 6ET; |
|
"Panel" |
the Panel on Takeovers and Mergers; |
|
"Participating Management Members" |
Raymond Mould, Patrick Vaughan, Martin McGann, Humphrey Price, Jackie Jessop, Jadzia Duzniak, Jeremy Bishop, Stewart Little and GEPT;
|
|
"Peel Hunt" |
Peel Hunt LLP (a limited liability partnership incorporated in England and Wales with registered number OC357088) whose registered office is Moor House, 120 London Wall, London, EC2Y 5ET; |
|
"Pillar" |
Pillar Property Group Limited, formerly named Pillar Property plc (registered in England and Wales under company no. 2570618); |
|
"Pro Forma EPRA NAV per Share" |
the pro forma EPRA NAV per share of the Enlarged Group as at 30 September 2012, taking into account the sale of Meadowhall, the effects of the Merger (including goodwill arising upon the Merger based on a New Ordinary Share price equal to 117 pence) and the impact of the Tender Offer being taken up in full (assuming a Tender Offer price of 112.9 pence per share) (such prices being used for illustrative purposes only); |
|
"Proposals" |
the Merger, the issue and allotment of the New Ordinary Shares in connection with the Merger, the Admission, the Tender Offer and variation to management incentives provided for under the Existing Management Incentive Agreement;
|
|
"Registrar of Companies" |
the Registrar of Companies in England and Wales; |
|
"Regulatory Information Service" |
any of the services set out in schedule 12 to the Listing Rules;
|
|
"Restricted Overseas Person" |
means a 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 London & Stamford believes to be in, or resident in, a Restricted Jurisdiction (or any custodian, nominee or trustee for such persons) and person in any other jurisdiction (other than persons in the UK) whom London & Stamford 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 London & Stamford regards as unduly onerous; |
|
"Restricted Jurisdiction" |
any jurisdiction where the relevant action would constitute a violation of the relevant laws and regulations of such jurisdiction or would result in a requirement to comply with any governmental or other consent or any registration, filing or other formality which London & Stamford or Metric regards as unduly onerous; |
|
"Scheme" |
the proposed scheme of arrangement under Part 26 of the Companies Act between Metric and the Scheme Shareholders set out in the Scheme Document;
|
|
"Scheme Court Hearing" |
the hearing by the Court of the application to sanction the Scheme;
|
|
"Scheme Court Hearing Date" |
the date of the Scheme Court Hearing; |
|
"Scheme Document" |
the scheme document to be sent to Metric Shareholders; |
|
"Scheme Shareholder" |
a holder of Scheme Shares;
|
|
"Scheme Shares"
|
(i) the Metric Existing Ordinary Shares in issue at the date of the Scheme Document; (i) Metric Ordinary Shares (if any) issued after the date of the Scheme Document but before the Voting Record Time; (ii) Metric Ordinary Shares (if any) issued at or after the Voting Record Time and before the Hearing Record Time on terms that the original or any subsequent holders shall be, or shall have agreed in writing by such time to be, bound by the Scheme, in each case excluding any Metric Ordinary Shares legally or beneficially owned by the London & Stamford Group;
|
|
"Takeover Offer" |
has the meaning given to it in Part 28 of the Companies Act;
|
|
"Tender Offer" |
the invitation by an intermediary to Eligible Shareholders to tender, in aggregate, up to 88,573,959 Ordinary Shares, representing approximately 12 per cent. of the Enlarged Share Capital;
|
|
"Third Party" |
any government, government department or governmental, quasi-governmental, supranational, statutory, regulatory, environmental or investigative body or association, institution or agency (including, without limitation, any trade agency and the UK Gambling Commission) or authority (including, without limitation, any anti-trust or merger control authority), any court or professional or environmental body or any other person or body whatsoever in any relevant jurisdiction;
|
|
"UK" or "United Kingdom" |
the United Kingdom of Great Britain and Northern Ireland;
|
|
"UK Listing Authority" |
the FSA acting in its capacity as the competent authority for listing under the Financial Services and Markets Act 2000; |
|
"UK-REIT" |
a UK Real Estate Investment Trust under Part 12 of the Corporation Tax Act 2010; |
|
"United States of America", "United States" or "US" |
the United States of America, its territories and possessions, any state of the United States and the District of Columbia; |
|
"US Securities Act" |
the US Securities Act of 1933, as amended; |
|
"Voting Record Time" |
6.00 p.m. on the day prior to the day immediately before the Metric Court Meeting or, if the Metric Court Meeting is adjourned, 48 hours before the time set for such adjourned meeting; |
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"Wider London & Stamford Group" |
London & Stamford and its subsidiaries, subsidiary undertakings and associated undertakings and any other body corporate, partnership, joint venture or person in which London & Stamford and such undertakings (aggregating their interests) have a direct or indirect interest of 20 per cent. or more of the voting or equity capital or the equivalent; and
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"Wider Metric Group" |
Metric and its subsidiaries, subsidiary undertakings and associated undertakings and any other body corporate, partnership, joint venture or person in which Metric and such undertakings (aggregating their interests) have a direct or indirect interest of 20 per cent. or more of the voting or equity capital or the equivalent. |
For the purposes of this announcement, "subsidiary", "subsidiary undertaking", "undertaking" and "associated undertaking" have the meanings given by sections 1162 and schedule 7 of the Companies Act.
All the times referred to in this document are London times unless otherwise stated.
References to the singular include the plural and vice versa.
References to an enactment include references to that enactment as amended, replaced, consolidated or re-enacted by or under any other enactment before or after the date of this announcement.
This information is provided by RNS
COMPANIES COVERED:
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