Re acquisition
Spice PLC
30 July 2007
NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION IN WHOLE OR IN PART IN OR INTO THE
UNITED STATES, AUSTRALIA, CANADA OR JAPAN OR ANY OTHER JURISDICTION WHERE TO DO
SO WOULD BE UNLAWFUL
ANNOUNCEMENT
FOR IMMEDIATE RELEASE
30 July 2007
RECOMMENDED CASH AND SHARE ACQUISITION
by
SPICE PLC
of
REVENUE ASSURANCE SERVICES PLC
(TO BE EFFECTED BY MEANS OF A SCHEME OF ARRANGEMENT)
Summary
• The boards of Spice and Revenue Assurance are pleased to announce that they
have agreed the terms for a recommended cash and share acquisition by Spice of
the entire issued and to be issued share capital of Revenue Assurance. It is
intended that the Acquisition be effected by way of a Court sanctioned scheme
of arrangement between Revenue Assurance and its shareholders under section
425 of the Companies Act.
• Under the terms of the Acquisition, Revenue Assurance Shareholders on the
register of members at the Reorganisation Record Time will be entitled to
receive:
For every 100 Revenue Assurance Shares £125.50 in cash
AND
13.09 New Spice Shares
and so in proportion for any other number of Revenue Assurance Shares held.
• Based on the Closing Price of 615 pence per Spice Share on 27 July 2007,
being the last business day prior to this Announcement, the Acquisition:
• values, on a fully diluted basis, each Revenue Assurance Share at
approximately 206 pence and the existing issued and to be issued share
capital of Revenue Assurance at approximately £102.9 million;
• represents a premium of approximately 29.6 per cent. to the Closing Price of
159 pence per Revenue Assurance Share on 11 July 2007, being the last
business day prior to the commencement of the Offer Period;
• represents a premium of approximately 17.0 per cent. to the Closing Price of
176 pence per Revenue Assurance Share on 27 July 2007, being the last
business day prior to the date of this Announcement; and
• represents a premium of approximately 40.9 per cent. to the average Closing
Price of a Revenue Assurance Share of approximately 146 pence for the three
months prior to 27 July 2007, being the last business day prior to the date
of this Announcement.
• Spice has received irrevocable undertakings to vote in favour of the Scheme in
respect of a total of 11,699,584 Revenue Assurance Shares, representing
approximately 27.4 per cent. of the existing issued share capital of Revenue
Assurance. In addition, Spice has received non-binding letters of intent to
vote in favour of the Scheme in respect of a total of 5,410,844 Revenue
Assurance Shares, representing approximately 12.7 per cent. of the existing
issued share capital of Revenue Assurance. In aggregate, Spice has therefore
received irrevocable undertakings and letters of intent to vote in favour of the
Scheme in respect of a total of 17,110,428 Revenue Assurance Shares,
representing in aggregate approximately 40.0 per cent. of the existing issued
share capital of Revenue Assurance.
• The Spice Board believes that combining Spice and Revenue Assurance has
compelling strategic and financial logic for both companies. The combination
should provide additional scale to the Revenue Assurance business and with it
the opportunity to deliver its product offering to a broader potential customer
base. In particular, the Acquisition will provide the opportunity for Spice to
strengthen its position in the utility billing market, enhance its services in
the energy procurement market, move into the higher value-added consultancy
market and further penetrate the electricity, telecommunications and water
sectors. In addition, it is expected that the Acquisition will be able to
deliver cost synergies to the Enlarged Group.
• The Revenue Assurance Directors believe that the Acquisition represents an
attractive opportunity for Revenue Assurance Shareholders both to realise a
premium to the three month average Revenue Assurance Closing Price and to
participate in the prospects of the Enlarged Group going forward.
• The Scheme Document will be posted in due course and in any event within 28
days from the date of this Announcement, and it is expected that the Scheme will
become Effective during mid-October 2007, subject to the satisfaction or waiver
of all Conditions set out in Appendix 1 to this Announcement.
• Spice intends, subject to market conditions, to move its quotation from AIM to
the Official List within the next 18 months.
Commenting on the Acquisition, Simon Rigby, Chief Executive of Spice, said:
"Revenue Assurance is focused purely on utility bill verification and utility
debt collection services and we became interested in it to complement our own
bill verification business (Inenco) and field operations business (MeterU). We
have been in discussions for some time and it became apparent that Revenue
Assurance was not only an excellent business with a strong position in its
markets but also a great fit with us. It has the added bonus of being a leading
player in the gas market, which is our least penetrated utility.
"Revenue Assurance provides a high quality service to its utility customers
through a highly skilled workforce, attributes which sit well with our own
business. Revenue Assurance will enhance our position as a provider of
outsourced support services to utility companies and continue our plan to
increase the skills levels within our group. The challenge for Revenue
Assurance is to repeat its success in gas in electricity - not least because the
electricity market is over twice the size of the gas market. Spice has a proven
track record of cross selling and through our energy management business, we are
already well established as a procurer of electricity and we believe our
contacts within the electricity supply sector will enable us to continue the
success Revenue Assurance has had to date. We are pleased that the entire
operational management team are staying on with us."
Commenting on the Acquisition, Simon Beart, Chief Executive and Deputy Chairman
of Revenue Assurance, said:
"This Offer recognises the significant achievements at Revenue Assurance as well
as allowing our shareholders to participate in the upside of the Enlarged Group.
"Revenue Assurance will continue to prosper as part of the Spice group and will
benefit from greater scale and a broader offering to customers. We are pleased
to recommend a transaction with strong and obvious commercial logic".
Enquiries:
Spice plc Revenue Assurance Services plc
Tel: +44 (0) 113 201 2120 Tel: +44 (0) 1483 735 700
Simon Rigby Simon Beart
Oliver Lightowlers William Good
Carl Chambers
Bridgewell Limited Cenkos Securities plc
(Financial adviser to Spice) (Financial adviser, nominated adviser
and broker to Revenue Assurance)
Tel: +44 (0) 20 7003 3000 Tel: +44 (0) 20 7397 8900
Simon Hardy Nicholas Wells
Simon Bridges Simon Southwood
Dan Webster
KBC Peel Hunt Limited
(Nominated adviser and broker to Spice)
Tel: +44 (0) 20 7418 8900
Julian Blunt
Financial Dynamics
(Financial PR adviser to Spice)
Tel: +44 (0) 207 831 3113
Billy Clegg
Caroline Stewart
A telephone conference call for analysts has been scheduled for 11.00 a.m. on 30
July 2007. The dial-in details for the conference call will be as follows:
Dial in number: 0845 146 2004
Passcode reference: Spice
The above summary should be read in conjunction with, and is subject to, the
full text of this Announcement and the Appendices. The Conditions to the
implementation of the Scheme and the Acquisition are set out in Appendix 1 to
this Announcement. The bases and sources of certain financial information
contained in this Announcement are set out in Appendix 2 to this Announcement.
Certain definitions and terms used in this Announcement are set out in Appendix
3 to this Announcement.
The Revenue Assurance Directors accept responsibility for the information
contained in this Announcement relating to Revenue Assurance and its
subsidiaries, themselves and their immediate families and connected persons. The
Spice Directors accept responsibility for all other information contained in
this Announcement. To the best of the knowledge and belief of the Revenue
Assurance Directors and the Spice Directors (who have taken all reasonable care
to ensure that such is the case), the information contained in this Announcement
for which they each accept responsibility is in accordance with the facts and
does not omit anything likely to affect the import of such information.
Bridgewell, which is authorised and regulated in the United Kingdom by the
Financial Services Authority, is acting exclusively for Spice and no one else in
connection with the Acquisition and other matters referred to in this
Announcement and the Scheme and will not be responsible to anyone other than
Spice for providing the protections afforded to clients of Bridgewell nor for
giving advice in relation to the Acquisition and the Scheme or any other matter
or arrangement referred to in this Announcement.
Cenkos, which is authorised and regulated in the United Kingdom by the Financial
Services Authority, is acting exclusively for Revenue Assurance and no one else
in connection with the Acquisition and the Scheme and will not be responsible to
anyone other than Revenue Assurance for providing the protections afforded to
the clients of Cenkos nor for giving advice in relation to the Acquisition and
the Scheme or any other matter or arrangement referred to in this Announcement.
Overseas Jurisdictions
The release, publication or distribution of this Announcement in jurisdictions
other than the United Kingdom may be restricted by law and therefore any persons
who are subject to the laws of any jurisdiction other than the United Kingdom
should inform themselves about, and observe, any applicable requirements. This
Announcement has been prepared for the purposes of complying with English law
and the City Code and the information disclosed may not be the same as that
which would have been disclosed if this Announcement had been prepared in
accordance with the laws and regulations of any jurisdiction outside of England.
This Announcement does not constitute an offer to sell or an invitation to
purchase or subscribe for any securities or a solicitation of any vote or
approval in any jurisdiction whether relating to the Acquisition or otherwise.
This Announcement does not constitute a prospectus or a prospectus equivalent
document. The Acquisition will be made solely through the Scheme Document which
will contain the full details, terms and conditions of the Acquisition,
including details of how to vote in respect of the Acquisition. Revenue
Assurance Shareholders are advised to read carefully the formal documentation in
relation to the Acquisition once it has been despatched.
In particular, this Announcement is not an offer of securities for sale in the
United States and the New Spice Shares, which will be issued in connection with
the Acquisition, have not been, and will not be, registered under the Securities
Act or under the securities law of any state, district or other jurisdiction of
the United States, Australia, Canada or Japan and no regulatory clearance in
respect of the New Spice Shares has been, or will be, applied for in any
jurisdiction other than the UK. Accordingly, the New Spice Shares are not being
and may not be (unless an exemption under relevant securities laws is
applicable) offered sold, resold or delivered, directly or indirectly, in or
into the United States, Australia, Canada or Japan or any other jurisdiction if
to do so would constitute a violation of the relevant laws of, or require
registration thereof in, such jurisdiction or to, or for the account or benefit
of, any United States, Australian, Canadian or Japanese person.
Forward Looking Statements
This Announcement contains certain forward looking statements with respect to
the financial condition, results of operations and business of Revenue Assurance
or the Revenue Assurance Group and/or Spice or the Spice Group and certain plans
and objectives of the boards of directors of Revenue Assurance and Spice. These
forward looking statements can be identified by the fact that they do not relate
to historical or current facts. Forward looking statements often use words such
as "anticipate", "target", "expect", "estimate", "intend", "plan", "goal",
"believe", "will", "may", "should", "would", "could" or other words of similar
meaning. These statements are based on assumptions and assessments made by the
boards of directors of Revenue Assurance and Spice in the light of their
experience and their perception of historical trends, current conditions,
expected future developments and other factors they believe appropriate. By
their nature, forward looking statements involve risk and uncertainty and the
factors described in the context of such forward looking statements in this
Announcement could cause actual results and developments to differ materially
from those expressed in or implied by such forward looking statements.
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. Revenue Assurance and Spice assume no
obligation to update or correct the information contained in this Announcement.
Dealing Disclosure Requirements
Under the provisions of Rule 8.3 of the City Code, if any person is, or becomes,
"interested" (directly or indirectly) in one per cent. or more of any class of
"relevant securities" of Revenue Assurance or Spice, all "dealings" in any
"relevant securities" of that company (including by means of an option in
respect of, or a derivative referenced to, any such "relevant securities") must
be publicly disclosed by no later than 3.30 p.m. on the London business day
following the date of the relevant transaction. This requirement will continue
until the Effective Date, or until the date on which the Scheme lapses or is
otherwise withdrawn or on which the "offer period" otherwise ends (or, if Spice
elects to effect the Acquisition by way of an offer, until the date on which
such offer becomes, or is declared, unconditional as to acceptances, lapses or
is otherwise withdrawn or on which the "offer period" otherwise ends). If two or
more persons act together pursuant to an agreement or understanding, whether
formal or informal, to acquire an "interest" in "relevant securities" of Revenue
Assurance or Spice, they will be deemed to be a single person for the purpose of
Rule 8.3.
Under the provisions of Rule 8.1 of the City Code, all "dealings" in "relevant
securities" of Revenue Assurance or Spice by Revenue Assurance or Spice, or by
any of their respective "associates", must be disclosed by no later than noon on
the London business day following the date of the relevant transaction.
A disclosure table, giving details of the companies in whose "relevant
securities" "dealings" should be disclosed, and the number of such securities in
issue, can be found on the Panel's website at www.thetakeoverpanel.org.uk .
"Interests in securities" arise, in summary, when a person has long economic
exposure, whether conditional or absolute, to changes in the price of
securities. In particular, a person will be treated as having an "interest" by
virtue of the ownership or control of securities, or by virtue of any option in
respect of, or derivative referenced to, securities.
Terms in quotation marks are defined in the City Code, which can also be found
on the Panel's website. If you are in any doubt as to whether or not you are
required to disclose a "dealing" under Rule 8, you should consult the Panel.
Copies of this Announcement can be found at Revenue Assurance's and Spice's
websites at www.rasplc.com and www.spiceplc.com respectively.
NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION IN WHOLE OR IN PART IN OR INTO THE
UNITED STATES, AUSTRALIA, CANADA OR JAPAN OR ANY OTHER JURISDICTION WHERE TO DO
SO WOULD BE UNLAWFUL
ANNOUNCEMENT
FOR IMMEDIATE RELEASE
30 July 2007
RECOMMENDED CASH AND SHARE ACQUISITION
by
SPICE PLC
of
REVENUE ASSURANCE SERVICES PLC
(TO BE EFFECTED BY MEANS OF A SCHEME OF ARRANGEMENT)
1. Introduction
The boards of Spice and Revenue Assurance are pleased to announce that they have
agreed the terms for a recommended cash and share acquisition by Spice of the
entire issued and to be issued share capital of Revenue Assurance. It is
intended that the Acquisition be effected by way of a Court sanctioned scheme of
arrangement between Revenue Assurance and its shareholders under section 425 of
the Companies Act. Subject to the satisfaction or, where appropriate, waiver of
the Conditions, it is expected that the Acquisition will become Effective during
mid-October 2007.
2. The Acquisition
Under the terms of the Scheme, which will be subject to the conditions and
further terms set out in Appendix 1 to this Announcement, and the full terms and
the Conditions which will be set out in the Scheme Document, Revenue Assurance
Shareholders on the register of members of Revenue Assurance at the
Reorganisation Record Time, will be entitled to receive:
For every 100 Revenue Assurance Shares £125.50 in cash
AND
13.09 New Spice Shares
and so in proportion for any other number of Revenue Assurance Shares held.
Based on the Closing Price of 615 pence per Spice Share on 27 July 2007, being
the last business day prior to this Announcement, the Acquisition:
• values, on a fully diluted basis, each Revenue Assurance Share at
approximately 206 pence and the existing issued and to be issued share
capital of Revenue Assurance at approximately £102.9 million;
• represents a premium of approximately 29.6 per cent. to the Closing Price
of 159 pence per Revenue Assurance Share on 11 July 2007, being the last
business day prior to the commencement of the Offer Period;
• represents a premium of approximately 17.0 per cent. to the Closing Price
of 176 pence per Revenue Assurance Share on 27 July 2007, being the last
business day prior to the date of this Announcement; and
• represents a premium of approximately 40.9 per cent. to the average Closing
Price of a Revenue Assurance Share of approximately 146 pence for the three
months prior to 27 July 2007, being the last business day prior to the date
of this Announcement.
Assuming that a maximum number of approximately 6.5 million New Spice Shares
will be issued pursuant to the Acquisition, Revenue Assurance Shareholders will
hold New Spice Shares representing approximately 10.9 per cent. of the enlarged
issued share capital of Spice immediately after completion of the Acquisition.
The New Spice Shares will be allotted and issued credited as fully paid and will
rank pari passu in all respects with the Spice Shares in issue at the time the
New Spice Shares are allotted and issued pursuant to the Acquisition, including
the right to receive and retain dividends and other distributions declared, made
or paid by reference to a record date falling after the Effective Date.
Application will be made to the London Stock Exchange for the New Spice Shares
to be admitted to trading on AIM. It is expected that Admission will become
effective and that trading in the New Spice Shares will commence on AIM on the
Effective Date.
Any Revenue Assurance Shares issued pursuant to the exercise of options or
awards under the Revenue Assurance Share Schemes or pursuant to the exercise of
the Warrants prior to the Reorganisation Record Time will be subject to the
Scheme. Pursuant to the Scheme, the Articles will be amended to ensure that any
Revenue Assurance Share allotted and issued pursuant to the exercise of an
option or award under the Revenue Assurance Share Schemes or pursuant to the
exercise of the Warrants (which are not subject to the Scheme) will be
automatically transferred to, and purchased by, Spice (or its nominee(s)) for
0.1309 of a New Spice Share and 125.50 pence in Cash Consideration. Any Revenue
Assurance Shares issued as deferred consideration in connection with the
acquisition of UBM Limited, depending on the date and time of issue, shall be
treated in the manner set out in this paragraph.
For the avoidance of doubt, Revenue Assurance Shareholders on Revenue
Assurance's register of members on the dividend record date of 27 July 2007 will
still be paid (subject to approval at Revenue Assurance's annual general meeting
to be held today) the final dividend of 1.6 pence per Revenue Assurance Share on
24 August 2007.
There are no agreements or arrangements to which Spice is a party which relate
to the circumstances in which it may or may not invoke or seek to invoke a
condition of the Acquisition.
3. The Mix and Match Facility
A Mix and Match Facility will also be made available pursuant to which Revenue
Assurance Shareholders (other than certain Overseas Shareholders) may elect to
vary the proportions in which they receive New Spice Shares and Cash
Consideration in respect of their Revenue Assurance Shares. However, the
maximum number of New Spice Shares that will be issued and the maximum amount of
Cash Consideration that will be paid pursuant to the Acquisition will not be
varied as a result of elections made under the Mix and Match Facility, save
where required to accommodate rounding of individual entitlements to the nearest
whole number of New Spice Shares. Accordingly, Spice's ability to satisfy
elections made by Revenue Assurance Shareholders under the Mix and Match
Facility will depend upon other Revenue Assurance Shareholders making offsetting
elections. To the extent that elections for New Spice Shares and/or Cash
Consideration cannot be satisfied in full, they will be scaled back on a pro
rata basis.
The Mix and Match Facility will not affect the entitlements of those Revenue
Assurance Shareholders who do not make elections under the Mix and Match
Facility, each of whom will receive New Spice Shares and Cash Consideration in
accordance with the terms of the Scheme.
Full details of the Mix and Match Facility will be set out in the Scheme
Document.
4. Recommendation
The Revenue Assurance Directors, who have been so advised by Cenkos, unanimously
consider the terms of the Acquisition to be fair and reasonable. In providing
advice to the Revenue Assurance Directors, Cenkos has taken into account the
commercial assessments of the Revenue Assurance Directors.
Accordingly, the Revenue Assurance Directors believe that the terms of the
Acquisition are in the best interests of Revenue Assurance Shareholders as a
whole and intend to unanimously recommend that Revenue Assurance Shareholders
(to the extent they are entitled to do so) vote in favour of the resolutions to
be proposed at the Court Meeting and the EGM, as they have irrevocably
undertaken to do in respect of their own (and certain connected parties') entire
legal and beneficial holdings of Revenue Assurance Shares amounting to, in
aggregate, 714,746 Revenue Assurance Shares, representing approximately 1.7 per
cent. of Revenue Assurance's existing issued share capital.
5. Information on Revenue Assurance
Revenue Assurance is a leading UK provider of energy imbalance billing
consultancy and collections services to major UK utilities. The Revenue
Assurance business comprises three divisions: Imbalance Billing Consultancy,
Debt Collection and Meter Point Services.
Revenue Assurance's Imbalance Billing Consultancy Division provides a service to
major UK utilities that identifies imbalances between the supply and consumption
of energy by primarily industrial and commercial consumers. Due to the
complexity of the billing environment there are sometimes overcharges to, or
under billing made by, Revenue Assurance's utility clients. Revenue Assurance's
past experience indicates that approximately 1-3 per cent. of the turnover of
major utilities is lost in one of these ways. Revenue Assurance uses its
specialist software and proprietary processes to identify and assist in the
correction of these errors and charges the utility, on a contingent basis, a
percentage of the value recovered.
In addition to the Imbalance Billing Consultancy Division, Revenue Assurance has
two debt collection agencies operating from separate UK centres. The Debt
Collection Division offers specialised services focused on the collection and
resolution of problem invoices issued by UK utilities. Fees are charged on a
contingent basis at a percentage of value recovered.
In the event of non-payment of a utility invoice, the Meter Point Services
Division, including some 250 field agents, provides the capacity for pre-
disconnection site visits and ultimately enforced isolation of the utility
supply. The Meter Point Services Division operates from one consolidated site
in the North West of England and, whilst primarily focused on industrial and
commercial customers, is the only part of Revenue Assurance handling domestic
data or services. Fees are charged on a price per visit basis.
Revenue Assurance generated £4.6 million profit before tax for the year ended 31
March 2007 from revenues of £14.6 million. As at 31 March 2007, Revenue
Assurance's net assets stood at £34.4 million and net debt was £8.8 million.
Revenue Assurance current trading
In the first quarter since the year end, trading has been satisfactory, with the
Revenue Assurance Group's results marginally ahead of management's expectations.
The Revenue Assurance Group has also recently signed a new contract for the Debt
Collections Division and a new contract with British Energy Group plc for the
Imbalance Billing Consultancy Division.
In the light of favourable contract developments and the Revenue Assurance
Group's activity levels, the Revenue Assurance Board continues to believe that
the prospects for the Revenue Assurance Group are encouraging.
6. Background to, and reasons for, recommending the Acquisition
Revenue Assurance entered the market for outsourced billing services and debt
management on behalf of utilities in mid-2005. Since that date, the activities
of the Revenue Assurance Group have grown by acquisition, whilst improved
management has also led to significant profit growth. Revenue Assurance has
been able to broaden its range of services offered to customers during this
period and secure a number of material contracts providing long-term income
visibility.
The principal customers for Revenue Assurance's services are large multi-
national utilities which have been experiencing ownership consolidation. This
process has also made it commercially attractive for utility services companies
to seek greater scale in order to meet the needs of their customers.
The opportunity to merge with Spice offers Revenue Assurance greater scale. The
Enlarged Group will have over 3,500 employees and expects to be able to secure
broader access to its customer base as well as the opportunity to deliver a
wider product offering. The Revenue Assurance Directors also believe that the
Enlarged Group will enable Revenue Assurance to offer its services to Spice's
existing customers as a result of the increased scale and presence of the
Enlarged Group.
The Revenue Assurance Directors believe that the terms of the Acquisition fairly
reflect the potential benefits that can be derived from combining the two
businesses. The value of the Acquisition also represents a premium of
approximately 17 per cent. to the Closing Price of a Revenue Assurance Share of
176 pence on 27 July 2007 (being the last business day prior to the date of this
Announcement). The Revenue Assurance Directors believe that the Acquisition
represents an attractive opportunity for Revenue Assurance Shareholders both to
realise a premium to the three month average Closing Price of a Revenue
Assurance Share and to participate in the prospects of the Enlarged Group. The
Revenue Assurance Directors therefore intend to unanimously recommend to Revenue
Assurance Shareholders that they vote in favour of the Scheme.
7. Information on Spice
The principal activities of Spice are the provision of support services within
three sectors: Commercial Services, Public Services and Utility Services. Spice
provides these services principally within the United Kingdom. Spice's Utility
Services Division comprises electricity, telecommunications and water services.
• The electricity business is the original core component of Spice since the
management buy-out from Yorkshire Electricity in 1996. The electricity unit
provides support to electricity distributors. These distributors are
responsible for operating, maintaining and regenerating the assets (overhead
lines, sub-stations, cabling and switchgear) that transport electricity from the
grid supply points to individual customers. Spice has become a full service
provider to these distributors and is moving towards providing more consultancy
type services through its five business areas: asset care/maintenance; volume
asset replacement; power projects/lines; consultancy services; and network
solutions.
• The telecommunications business consists of distinct but complementary
businesses focusing primarily on infrastructure support, including network
operations, installation and maintenance services. The unit is a specialist in
non-wired shared networks and the largest part of the business, Air Radio,
supplies ground-to-air and ground-to-ground communications to a wide range of
users in UK airports.
• The water business involves a mix of complementary operations relating to
clean water supplies, including water meter installation, water main renewal and
maintenance, new water connections, leakage detection and repair, water by-law
inspections and water meter readings. The Commercial Services Division is made
up of two business units: energy services and facilities services.
• The energy services business was formed in June 2006 through the
acquisition of Inenco, a leading UK energy management business. The unit
provides procurement services, environmental services, environmental
consultancy, bill validation and installation services to its customers.
• The facilities services operation provides facilities management services
through three divisions: planned and reactive maintenance; small works; and
claims. The planned and reactive maintenance unit's services include fixed wire
testing and inspecting, portable appliance testing and emergency lighting and
fire-alarm testing. The small works unit provides low value refurbishment and
leasehold dilapidation services. The claims unit manages re-instatement
services on behalf of large insurance companies.
The Public Services Division was created at the end of 2006 following the
acquisitions of Apollo and ParGas. Both businesses provide gas services in the
social housing market and are responsible for the management and delivery of
long-term gas maintenance contracts to housing associations, local authorities
and private landlords. The Public Services Division also acquired Homerton in
May 2007, which extended the footprint of the division in the South of England.
For the year ended 29 April 2007, Spice reported turnover, including
acquisitions, of £228.6 million and pre-tax profit of £10.1 million for that
period. As at 29 April 2007, Spice's net assets stood at £67.3 million and net
debt was £34.3 million.
Spice intends, subject to market conditions, to move its quotation from AIM to
the Official List within the next 18 months.
Spice current trading
Spice's current trading is in line with the Spice Board's expectations.
8. Reasons for the Acquisition and intentions for Revenue Assurance
The Spice Board believes that the Acquisition has clear strategic and financial
logic for both Spice and Revenue Assurance and that it represents an opportunity
to create shareholder value for both the existing Spice Shareholders and,
through the share element of the consideration, for Revenue Assurance
Shareholders.
The Spice Board believes that the principal benefits of the Acquisition include:
• Strengthening Spice's position in the utility billing market
Revenue Assurance is one of the largest businesses in the provision of billing
error consultancy services to the utility sector in the UK, particularly in the
gas market. With the bill validation skills of Spice's energy services business
in the industrial and commercial markets, the addition of Revenue Assurance
would further increase the Enlarged Group's scale in the utility billing market.
• Enhancement of services in the energy procurement and consultancy market
Spice is already established as a leading participant in the energy
procurement and consultancy market through Inenco. The Acquisition provides an
excellent opportunity for Spice to add complementary skills and services to its
product offering in this area, and to cross-sell these services to a wider group
of clients within the Enlarged Group.
• Opportunity to further penetrate the electricity, telecommunications and
water sectors
Revenue Assurance is only beginning to penetrate the electricity market. Spice's
contacts with electricity suppliers are strong and should provide the Enlarged
Group with an opportunity to enhance and accelerate Revenue Assurance's presence
in this market.
Spice also believes that there is an opportunity to expand Revenue Assurance's
existing platform of services into the telecommunications and water sectors.
• Debt collection and meterpoint services valuable additions to existing
business
The debt collection and meterpoint services businesses of Revenue Assurance will
be valuable additions to the Spice portfolio of companies. The debt collection.
side would increase Spice's exposure to the utility sector, and will provide
opportunities to expand the services to local authorities through Spice's public
services division. The meterpoint services business would give Spice access to
250 additional field agents to enhance the Enlarged Group's meter reading
capability.
Additionally, Spice would provide Revenue Assurance with access to an additional
600 agency field staff to provide additional resource in the meterpoint services
business. Spice's relationships with several leading water companies would also
provide Revenue Assurance with opportunities to access an additional potential
revenue stream.
• Drive towards consultancy
The focus on consultancy in Revenue Assurance's business is in line with Spice's
aim of developing its higher skills services, and of being seen as a utility
support business with a wide range of services available to its clients.
• Synergies
Following the Acquisition, the Spice Board expects to be able to make reasonable
reductions to the Enlarged Group's cost base. Synergies are expected to be
derived from:
- reduced executive management costs; and
- savings in head office and other duplicate costs, including
professional fees and regulatory costs.
• Strategic fit
The Acquisition is a strong strategic fit, complementing and enhancing Spice's
existing business.
Spice's ambition for the Enlarged Group is to deliver maximum value to its
shareholders by means of growth, both organic and through further strategic
acquisitions. This is one of the Spice Group's key historic strengths.
• Enhancement in earnings per share
The Acquisition is expected to enhance earnings per share (before exceptional
costs) for Spice for the year ending 27 April 2008.
Note: This statement should not be taken to imply that the earnings per share of
Spice for the year ending 27 April 2008 will be higher than for the year ended
29 April 2007.
9. Management, employees and location
Each of the Revenue Assurance Directors has agreed to resign from the Revenue
Assurance Board, conditional upon, and with effect from, the Scheme becoming
Effective. In this regard, each of Simon Beart and William Good (being the only
executive Revenue Assurance Directors) have entered into compromise agreements
with Revenue Assurance pursuant to which, inter alia, Revenue Assurance has
agreed to make certain termination payments to them in connection with their
ceasing to be employed by the Revenue Assurance Group upon the Scheme becoming
Effective. Each of Simon Beart and William Good has also entered into
consultancy agreements with Spice, pursuant to which they will provide certain
transitional consultancy services to the Enlarged Group during the period from
the Effective Date until 31 March 2008. Cenkos, which has advised the Revenue
Assurance Directors, considers the terms of the consultancy arrangements between
Simon Beart, William Good and Spice referred to above to be fair and reasonable
so far as Revenue Assurance Shareholders are concerned.
Further details of these agreements and the other arrangements in respect of the
Revenue Assurance Directors will be set out in the Scheme Document.
Spice attaches great importance to the skills and experience of the existing
management and employees of Revenue Assurance and believes that opportunities
for the employees of the Enlarged Group will be enhanced in the event that the
Acquisition is completed. The Spice Board intends that, following the
completion of the Acquisition, the existing employment rights, including pension
rights, of all Revenue Assurance Group employees will be fully safeguarded.
Other than set out above, Spice confirms that it has no plans to alter existing
arrangements with employees or to change the locations of Revenue Assurance
Group's places of business.
Assuming none of the Revenue Assurance Directors make an election under the Mix
and Match Facility, following the Scheme becoming Effective, the Revenue
Assurance Directors will be interested, in aggregate, in 558,255 New Spice
Shares, representing approximately 0.9 per cent. of the enlarged issued share
capital of Spice following the Acquisition.
10. Revenue Assurance Share Schemes and the Warrants
Appropriate proposals will be made in due course to participants in the Revenue
Assurance Share Schemes and the holder of the Warrants. Details of these
proposals will be set out in the Scheme Document and in separate letters to be
sent to participants in the Revenue Assurance Share Schemes and the holder of
the Warrants.
11. Financing for the Acquisition
The Cash Consideration payable under the Acquisition will be financed by
Spice's syndicated £170 million loan facilities arranged by HSBC Bank plc.
Bridgewell is satisfied that sufficient resources are available to Spice to
satisfy the Cash Consideration payable as a result of the Scheme becoming
Effective.
12. Inducement Fee Agreement
Revenue Assurance has entered into an agreement with Spice under which Revenue
Assurance has agreed to pay an inducement fee equivalent to one per cent.
(inclusive of value added tax) of the value of Revenue Assurance (as determined
by reference to the Acquisition terms set out in this Announcement and which,
for the avoidance of doubt, will not fluctuate as a result of subsequent
movements in the price of Spice Shares after the date of this Announcement) to
Spice in the event that: (a) an Independent Inconsistent Transaction is
announced and becomes or is declared unconditional in all material respects or
otherwise completes; or (b) the Revenue Assurance Board withdraws or adversely
alters its recommendation of the Acquisition and the Scheme is not proposed, is
withdrawn or does not become Effective in accordance with its terms.
13. Implementation Agreement
Revenue Assurance and Spice have also entered into the Implementation Agreement,
which governs their relationship during the period until the Scheme becomes
Effective. Amongst other things, Spice and Revenue Assurance have agreed to co-
operate with regard to the process required to implement the Scheme and Revenue
Assurance has entered into certain undertakings concerning the conduct of its
business during that period.
14. The Scheme
It is intended that the Acquisition will be effected by means of a Court
sanctioned scheme of arrangement between Revenue Assurance and its shareholders
under section 425 of the Companies Act (although Spice has reserved the right to
implement the Acquisition by way of a Takeover Offer). Upon the Scheme becoming
Effective, Spice will become the owner of the whole of the issued share capital
of Revenue Assurance.
To become Effective, the Scheme will require, amongst other things, the approval
at the Court Meeting of a majority in number representing not less than three-
fourths in value of the Scheme Shareholders present and voting, either in person
or by proxy, at the Court Meeting, or at any adjournment thereof and the passing
of the resolution necessary to approve matters to give effect to the Scheme at
the Extraordinary General Meeting, or at any adjournment thereof. Following the
Extraordinary General Meeting and the Court Meeting and the satisfaction (or,
where applicable, waiver) of the other Conditions, the Scheme must also be
sanctioned by the Court at the Scheme Court Hearing and the associated Capital
Reduction must be confirmed by the Court at the Reduction Court Hearing.
The formal documentation setting out details of the Acquisition, including the
Scheme Document setting out the procedures to be followed to approve the Scheme,
will be posted to Revenue Assurance Shareholders (other than certain Overseas
Shareholders) in due course and in any event within 28 days from the date of
this Announcement. The Scheme Document will include full details of the Scheme,
together with notices of the Court Meeting and the Extraordinary General Meeting
and the expected timetable, and will specify the action to be taken by Scheme
Shareholders to approve the Scheme.
15. Irrevocable undertakings
Spice has received irrevocable undertakings to vote (or procure the vote) in
favour of the Scheme in respect of 11,699,584 Revenue Assurance Shares, in
aggregate representing approximately 27.4 per cent. of Revenue Assurance's
existing issued share capital. This includes irrevocable undertakings from
certain of the Revenue Assurance Directors in respect of 714,746 Revenue
Assurance Shares, representing approximately 1.7 per cent. of Revenue
Assurance's existing issued share capital held by them and certain connected
parties, as follows:
Name Revenue Assurance Shares Percentage of existing
issued share capital
of Revenue Assurance
Simon Delaval Beart 519,148 1.21%
Thomas William Good 161,488 0.38%
Ian Rodney Mann 8,300 0.02%
David Ronald Tiplady Thompson 5,810 0.01%
Alastair Macleod Taylor 20,000 0.05%
The undertakings given by certain of the Revenue Assurance Directors will remain
binding even if a higher competing offer for Revenue Assurance is made. They
will cease to be binding only if (i) the board of Revenue Assurance withdraws
its recommendation before the EGM and Court Meeting are held; (ii) the Scheme
Document (or the formal document containing any Takeover Offer) is not posted to
Revenue Assurance Shareholders by the date 28 days from the date of this
Announcement (or the announcement of any Takeover Offer) or such longer period
as may be permitted by the Panel; (iii) the Scheme or any resolution to be
proposed at the EGM is not approved by the requisite majority of the
shareholders of Revenue Assurance at the Court Meeting or at the EGM
respectively; (iv) an announcement of any Takeover Offer is not released by such
date as Spice and Revenue Assurance may, with the consent of the Panel, agree;
or (v) any Takeover Offer lapses or is withdrawn, provided that any Takeover
Offer is on terms no less favourable to Revenue Assurance Shareholders than the
terms set out in this Announcement.
Robin Alvarez has given an irrevocable undertaking to vote in favour of the
Scheme in respect of his entire beneficial holding of 6,960,322 Revenue
Assurance Shares, representing approximately 16.3 per cent. of the existing
issued share capital of Revenue Assurance. This undertaking will remain binding
even if a higher competing offer for Revenue Assurance is made. This will cease
to be binding only if (i) the board of Revenue Assurance withdraws its
recommendation before the EGM and Court Meeting are held; (ii) the Scheme
Document (or the formal document containing any Takeover Offer) is not posted to
Revenue Assurance Shareholders by the date 28 days from the date of this
Announcement (or the announcement of any Takeover Offer) or such longer period
as may be permitted by the Panel; (iii) the Scheme or any resolution to be
proposed at the EGM is not approved by the requisite majority of the
shareholders of Revenue Assurance at the Court Meeting or at the EGM
respectively; (iv) an announcement of any Takeover Offer is not released by such
date as Spice and Revenue Assurance may, with the consent of the Panel, agree;
or (v) any Takeover Offer lapses or is withdrawn, provided that any Takeover
Offer is on terms no less favourable to Revenue Assurance Shareholders than the
terms set out in this Announcement.
Other irrevocable undertakings to vote in favour of the Scheme have been
given by:
• Paul Craig Beverley in respect of his entire holding of 167,793 Revenue
Assurance Shares, representing approximately 0.39 per cent. of the existing
issued share capital of Revenue Assurance. This undertaking will remain binding
even if a higher competing offer for Revenue Assurance is made;
• Stephen Mark Beverley in respect of his entire holding of 181,112 Revenue
Assurance Shares, representing approximately 0.42 per cent. of the existing
issued share capital of Revenue Assurance. This undertaking will remain binding
even if a higher competing offer for Revenue Assurance is made;
• Brian Craig Beverley in respect of his entire holding of 1,003,598 Revenue
Assurance Shares, representing approximately 2.35 per cent. of the existing
issued share capital of Revenue Assurance. This undertaking will remain binding
even if a higher competing offer for Revenue Assurance is made;
• CMIS Limited Pension Fund in respect of its entire holding of 333,482
Revenue Assurance Shares, representing approximately 0.78 per cent. of the
existing issued share capital of Revenue Assurance. This undertaking will
remain binding even if a higher competing offer for Revenue Assurance is made;
• Polar Capital European Forager Fund Limited in respect of its entire holding
of 670,000 Revenue Assurance Shares, representing approximately 1.57 per cent.
of the existing issued share capital of Revenue Assurance. This undertaking
will cease to be binding if a higher competing offer for Revenue Assurance is
made that represents an improvement of more than 10 per cent. in the value of
the consideration under the Scheme; and
• Gartmore Investment Limited in respect of its entire holding of 1,668,531
Revenue Assurance Shares, representing approximately 3.91 per cent. of the
existing issued share capital of Revenue Assurance. This undertaking will cease
to be binding if a higher competing offer for Revenue Assurance is made that
represents an improvement of more than five per cent. in the value of the
consideration under the Scheme.
These undertakings will also cease to be binding if (i) the board of Revenue
Assurance withdraws its recommendation before the EGM and Court Meeting are
held; (ii) the Scheme Document (or the formal document containing any Takeover
Offer) is not posted to Revenue Assurance Shareholders by the date being 28 days
from the date of this Announcement (or the announcement of any Takeover Offer)
or such longer period as may be permitted by the Panel; (iii) the Scheme or any
resolution to be proposed at the EGM is not approved by the requisite majority
of the shareholders of Revenue Assurance at the Court Meeting or at the EGM
respectively; (iv) an announcement of any Takeover Offer is not released by such
date as Spice and Revenue Assurance may, with the consent of the Panel, agree;
or (v) any Takeover Offer lapses or is withdrawn, provided that any Takeover
Offer is on terms no less favourable to Revenue Assurance Shareholders than the
terms set out in this Announcement.
In addition, Spice has received letters of intent from:
• AXA Framlington Investment Management Limited to vote in favour of the
Scheme in respect of 1,662,692 Revenue Assurance Shares, representing
approximately 3.89 per cent. of Revenue Assurance's existing issued share
capital.;
• Morley Fund Management Limited to vote in favour of the Scheme in respect of
850,000 Revenue Assurance Shares, representing approximately 1.99 per cent. of
Revenue Assurance's existing issued share capital;
• Aberdeen Asset Managers Limited to vote in favour of the Scheme in respect
of 1,379,241 Revenue Assurance Shares, representing approximately 3.23 per cent.
of Revenue Assurance's existing issued share capital; and
• Invesco Asset Management Limited to vote in favour of the Scheme in respect
of 1,518,911 Revenue Assurance Shares, representing approximately 3.56 per cent.
of Revenue Assurance's existing issued share capital. In aggregate, therefore,
Spice has received irrevocable undertakings and letters of intent to vote in
favour of the Scheme in respect of 17,110,428 Revenue Assurance Shares
(representing approximately 40.0 per cent. of Revenue Assurance's existing
issued share capital).
16. Disclosure of interests in Revenue Assurance
As at the close of business on 27 July 2007 (being the latest practicable
business day prior to the date of this Announcement), neither Spice, nor any
Spice Director, nor, so far as Spice is aware, any person acting in concert with
Spice has any interest in, or has any right to subscribe for, any relevant
securities of Revenue Assurance, nor are they party to any short positions
(whether conditional or absolute and whether in the money or otherwise) relating
to relevant securities of Revenue Assurance, including short positions under
derivatives, agreements to sell or any delivery obligations or rights to require
another person to purchase or take delivery.
Neither Spice nor any Spice Director nor, so far as Spice is aware, any person
acting in concert with Spice has borrowed or lent any relevant securities of
Revenue Assurance. No arrangement exists with Spice nor any associate of Spice
(within the meaning of the Code) in relation to relevant securities of Revenue
Assurance. For these purposes, " arrangement" includes any indemnity or option
arrangement and any agreement or understanding, formal or informal, of whatever
nature, relating to relevant securities of Revenue Assurance which may be an
inducement to deal or refrain from dealing in such securities.
17. Cancellation of admission to trading on AIM and re-registration
Revenue Assurance will apply to the London Stock Exchange for the admission to
trading of Revenue Assurance Shares on AIM to be cancelled with effect from the
close of business on the business day immediately prior to the Effective Date.
It is also intended that Revenue Assurance be re-registered as a private
limited company in due course.
18. General
The Acquisition will be on the terms and subject to the Conditions set out in
Appendix 1 to this Announcement and to the full terms and conditions which will
be set out in the Scheme Document. The bases and sources of certain financial
information contained in this Announcement are set out in Appendix 2 to this
Announcement. Certain definitions and terms used in this Announcement are set
out in Appendix 3 to this Announcement.
It is expected that the Scheme Document will be sent to Revenue Assurance
Shareholders in due course and, in any event, within 28 days of this
Announcement (other than to certain Overseas Shareholders).
Enquiries:
Spice plc Revenue Assurance Services plc
Tel: +44 (0) 113 201 2120 Tel: +44 (0) 1483 735 700
Simon Rigby Simon Beart
Oliver Lightowlers William Good
Carl Chambers
Bridgewell Limited Cenkos Securities plc
(Financial adviser to Spice) (Financial adviser, nominated adviser and
broker to Revenue Assurance)
Tel: +44 (0) 20 7397 8900
Tel: +44 (0) 20 7003 3000
Simon Hardy Nicholas Wells
Simon Bridges Simon Southwood
Dan Webster
KBC Peel Hunt Limited
(Nominated adviser and broker to Spice)
Tel: +44 (0) 20 7418 8900
Julian Blunt
Financial Dynamics
(Financial PR adviser to Spice)
Tel: +44 (0) 207 831 3113
Billy Clegg
Caroline Stewart
A telephone conference call for analysts has been scheduled for 11.00 a.m. on 30
July 2007. The dial-in details for the conference call will be as follows:
Dial in number: 0845 146 2004
Passcode reference: Spice
The Revenue Assurance Directors accept responsibility for the information
contained in this Announcement relating to Revenue Assurance and its
subsidiaries, themselves and their immediate families and connected persons. The
Spice Directors accept responsibility for all other information contained in
this Announcement. To the best of the knowledge and belief of the Revenue
Assurance Directors and the Spice Directors (who have taken all reasonable care
to ensure that such is the case), the information contained in this Announcement
for which they each accept responsibility is in accordance with the facts and
does not omit anything likely to affect the import of such information.
Bridgewell, which is authorised and regulated in the United Kingdom by the
Financial Services Authority, is acting exclusively for Spice and no one else in
connection with the Acquisition and the Scheme and will not be responsible to
anyone other than Spice for providing the protections afforded to clients of
Bridgewell nor for giving advice in relation to the Acquisition and the Scheme
or any other matter or arrangement referred to in this Announcement.
Cenkos, which is authorised and regulated in the United Kingdom by the Financial
Services Authority, is acting exclusively for Revenue Assurance and no one else
in connection with the Acquisition and the Scheme and will not be responsible to
anyone other than Revenue Assurance for providing the protections afforded to
the clients of Cenkos nor for giving advice in relation to the Acquisition and
the Scheme or any other matter or arrangement referred to in this Announcement.
Overseas Jurisdictions
The release, publication or distribution of this Announcement in jurisdictions
other than the United Kingdom may be restricted by law and therefore any persons
who are subject to the laws of any jurisdiction other than the United Kingdom
should inform themselves about, and observe, any applicable requirements. This
Announcement has been prepared for the purposes of complying with English law
and the City Code and the information disclosed may not be the same as that
which would have been disclosed if this Announcement had been prepared in
accordance with the laws and regulations of any jurisdiction outside of England.
This Announcement does not constitute an offer to sell or an invitation to
purchase or subscribe for any securities or a solicitation of any vote or
approval in any jurisdiction whether relating to the Acquisition or otherwise.
This Announcement does not constitute a prospectus or a prospectus equivalent
document. The Acquisition will be made solely through the Scheme Document which
will contain the full details, terms and conditions of the Acquisition,
including details of how to vote in respect of the Acquisition. Revenue
Assurance Shareholders are advised to read carefully the formal documentation in
relation to the Acquisition once it has been despatched.
In particular, this Announcement is not an offer of securities for sale in the
United States and the New Spice Shares, which will be issued in connection with
the Acquisition, have not been, and will not be, registered under the Securities
Act or under the securities law of any state, district or other jurisdiction of
the United States, Australia, Canada or Japan and no regulatory clearance in
respect of the New Spice Shares has been, or will be, applied for in any
jurisdiction other than the UK. Accordingly, the New Spice Shares are not being
and may not be (unless an exemption under relevant securities laws is
applicable) offered, sold, resold or delivered, directly or indirectly, in or
into the United States, Australia, Canada or Japan or any other jurisdiction if
to do so would constitute a violation of the relevant laws of, or require
registration thereof in, such jurisdiction or to, or for the account or benefit
of, any United States, Australian, Canadian or Japanese person. Forward Looking
Statements
This Announcement contains certain forward looking statements with respect to
the financial condition, results of operations and business of Revenue Assurance
or the Revenue Assurance Group and/or Spice or the Spice Group and certain plans
and objectives of the boards of directors of Revenue Assurance and Spice. These
forward looking statements can be identified by the fact that they do not relate
to historical or current facts. Forward looking statements often use words such
as "anticipate", "target", "expect", "estimate", "intend", "plan", "goal",
"believe", "will", "may", "should", "would", "could" or other words of similar
meaning. These statements are based on assumptions and assessments made by the
boards of directors of Revenue Assurance and Spice in the light of their
experience and their perception of historical trends, current conditions,
expected future developments and other factors they believe appropriate. By
their nature, forward looking statements involve risk and uncertainty and the
factors described in the context of such forward looking statements in this
Announcement could cause actual results and developments to differ materially
from those expressed in or implied by such forward looking statements.
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. Revenue Assurance and Spice assume no
obligation to update or correct the information contained in this Announcement.
Dealing Disclosure Requirements
Under the provisions of Rule 8.3 of the City Code, if any person is, or becomes,
"interested" (directly or indirectly) in one per cent. or more of any class of
"relevant securities" of Revenue Assurance or Spice, all "dealings" in any
"relevant securities" of that company (including by means of an option in
respect of, or a derivative referenced to, any such "relevant securities") must
be publicly disclosed by no later than 3.30 p.m. on the London business day
following the date of the relevant transaction. This requirement will continue
until the Effective Date, or until the date on which the Scheme lapses or is
otherwise withdrawn or on which the "offer period" otherwise ends (or, if Spice
elects to effect the Acquisition by way of an offer, until the date on which
such offer becomes, or is declared, unconditional as to acceptances, lapses or
is otherwise withdrawn or on which the "offer period" otherwise ends). If two or
more persons act together pursuant to an agreement or understanding, whether
formal or informal, to acquire an "interest" in "relevant securities" of Revenue
Assurance or Spice, they will be deemed to be a single person for the purpose of
Rule 8.3.
Under the provisions of Rule 8.1 of the City Code, all "dealings" in "relevant
securities" of Revenue Assurance or Spice by Revenue Assurance or Spice, or by
any of their respective "associates", must be disclosed by no later than noon on
the London business day following the date of the relevant transaction.
A disclosure table, giving details of the companies in whose "relevant
securities" "dealings" should be disclosed, and the number of such securities in
issue, can be found on the Panel's website at www.thetakeoverpanel.org.uk .
"Interests in securities" arise, in summary, when a person has long economic
exposure, whether conditional or absolute, to changes in the price of
securities. In particular, a person will be treated as having an "interest" by
virtue of the ownership or control of securities, or by virtue of any option in
respect of, or derivative referenced to, securities.
Terms in quotation marks are defined in the City Code, which can also be found
on the Panel's website. If you are in any doubt as to whether or not you are
required to disclose a "dealing" under Rule 8, you should consult the Panel.
Copies of this Announcement can be found at Revenue Assurance's and Spice's
websites at www.rasplc.com and www.spiceplc.com respectively.
APPENDIX 1
CONDITIONS TO THE IMPLEMENTATION OF THE SCHEME AND THE ACQUISITION
Part A
Conditions of the Acquisition
1. The Acquisition will be conditional upon the Scheme becoming unconditional
and becoming Effective, subject to the Code, by no later than 30 November 2007
or such later date as Revenue Assurance and Spice and (if required) the Court
may agree.
The Acquisition will be governed by English law and be subject to the
jurisdiction of the English courts, to the Conditions, to the terms to be set
out in the Scheme Document and in the Form of Election and to the applicable
requirements of the Code, the Panel and the London Stock Exchange.
2. The Scheme will be conditional upon:
2.1 the approval of the Scheme by a majority in number representing not
less than three-fourths in value of the holders of Scheme Shares, present
and voting, either in person or by proxy, at the Court Meeting or any
adjournment of that meeting;
2.2 the resolution required to approve and implement the Scheme and
set out in the notice of the Extraordinary General Meeting being
passed by the requisite majority at the Extraordinary General Meeting or any
adjournment of that meeting; and
2.3 the sanction (with or without modification) of the Scheme and the
confirmation of the Capital Reduction by the Court, office copies of the
Court Orders and the Minute being delivered for registration to the Registrar of
Companies and the registration of the Reduction Court Order confirming the
Capital Reduction with the Registrar of Companies.
3. Revenue Assurance and Spice have agreed that, subject as stated in
paragraph 4 below, the Acquisition will be conditional upon the following
matters:
3.1 the passing at the annual general meeting of Spice to be held on
5 September 2007 (or any adjournment thereof) of such resolutions as may
be necessary to give the Spice Board general and unconditional authority in
accordance with section 80 of the Companies Act to exercise all the powers of
Spice to allot the New Spice Shares;
3.2 the admission of the New Spice Shares to trading on AIM becoming
effective in accordance with the AIM Rules or (if Spice so determines
and subject to the consent of the Panel) the London Stock Exchange agreeing to
admit such shares to trading on AIM, subject only to the allotment of such
shares;
3.3 Authorisations
3.3.1 all authorisations in any jurisdiction which Spice reasonably
considers necessary or appropriate for, or in respect of, the Scheme,
its implementation or any acquisition of any shares in, or control of, Revenue
Assurance or any other member of the Wider Revenue Assurance Group by any member
of the Wider Spice Group having been obtained in terms and in a form
satisfactory to Spice acting reasonably from any relevant person or from any
person or body with whom any member of the Wider Revenue Assurance Group has
entered into contractual arrangements and all such authorisations remaining in
full force and effect and Revenue Assurance not having received written notice
of any intention to revoke or not renew the same; and
3.3.2 all authorisations which Spice reasonably considers necessary to
carry on the business of any member of the Wider Revenue Assurance
Group (where the absence of such authorisation would have a material and adverse
effect on the Wider Revenue Assurance Group taken as a whole) remaining in full
force and effect and Revenue Assurance not having received written notice of any
intention to revoke or not to renew the same; and
3.3.3 all filings which Spice reasonably considers necessary having been
made and all applicable waiting and other periods having expired, lapsed
or been terminated and all applicable statutory or regulatory obligations
in any jurisdiction having been complied with;
3.4 Regulatory Intervention
no relevant person having taken, instituted, implemented or threatened in
writing any legal proceedings, or having required any action to be taken or
otherwise having done anything or having enacted, made or proposed any statute,
regulation, order or decision or taken any other step and there not continuing
to be outstanding any statute, regulation, order or decision that would or might
reasonably be expected to:
3.4.1 make the Scheme, its implementation or the acquisition or proposed
acquisition of any shares in, or control or management of, the Wider
Revenue Assurance Group by Spice illegal, void or unenforceable; or
3.4.2 otherwise, directly or indirectly, prevent, prohibit or
otherwise materially restrict, restrain, delay or interfere in the
implementation of or impose additional conditions or obligations with respect to
or otherwise challenge or require amendment of the Scheme or the proposed
acquisition of Revenue Assurance by Spice or any acquisition of shares in
Revenue Assurance by Spice; or
3.4.3 require, prevent or materially delay the divestiture by
Spice of any shares or other securities in Revenue Assurance; or
3.4.4 impose any material limitation on the ability of any member
of the Wider Spice Group or any member of the Wider Revenue Assurance
Group to acquire or hold or exercise effectively, directly or indirectly, any
rights of ownership of shares or other securities or the equivalent in any
member of the Wider Revenue Assurance Group or management control over any
member of the Wider Revenue Assurance Group in any such case in a manner or to
an extent which is material to Spice in the context of the Scheme or, as the
case may be, in the context of the Wider Spice Group or the Wider Revenue
Assurance Group taken as a whole; or
3.4.5 require, prevent or materially delay the disposal by Revenue
Assurance or any member of the Revenue Assurance Group, or require the
disposal or alter the terms of any proposed disposal by any member of the Wider
Revenue Assurance Group, of all or any part of their respective businesses,
assets or properties or impose any limitation on the ability of any of them to
conduct their respective businesses or own their respective assets or properties
in any such case in a manner or to an extent which is material to Spice in the
context of the Scheme or, as the case may be, in the context of the Wider Spice
Group or the Wider Revenue Assurance Group taken as a whole; or
3.4.6 other than pursuant to the Scheme, require any member of the Wider
Spice Group or of the Wider Revenue Assurance Group to offer to acquire
any shares or other securities (or the equivalent) in any member of the
Wider Revenue Assurance Group or any member of the Wider Spice Group owned by
any third party (in each case, other than in connection with the implementation
of the Scheme), where such acquisition would be material to Spice in the context
of the Scheme or, as the case may be, in the context of the Wider Spice Group or
the Wider Revenue Assurance Group taken as a whole; or
3.4.7 impose any limitation on the ability of any member of the Wider
Spice Group or the Wider Revenue Assurance 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 Spice Group and/or the Wider Revenue
Assurance Group in each case in a manner which would be material to Spice in the
context of the Scheme or, as the case may be, in the context of the Wider Spice
Group or the Wider Revenue Assurance Group taken as a whole; or
3.4.8 result in any member of the Wider Spice Group or the Wider
Revenue Assurance Group ceasing to be able to carry on business under any
name under which it presently does so to an extent which is material to Spice in
the context of the Scheme or, as the case may be, in the context of the Wider
Spice Group or the Wider Revenue Assurance Group taken as a whole; or
3.4.9 otherwise adversely affect any or all of the businesses, assets,
prospects or profits of any member of the Wider Spice Group or the Wider
Revenue Assurance Group to an extent which is material to the Spice in the
context of the Scheme or, as the case may be, in the context of the Wider Spice
Group or the Wider Revenue Assurance Group taken as a whole;
and all applicable waiting and other time periods during which any such relevant
person could institute, or implement or threaten any legal proceedings, having
expired, lapsed or been terminated;
3.5 Consequences Of The Scheme
save as Disclosed, there being no provision of any agreements to which any
member of the Wider Revenue Assurance Group is a party, or by or to which any
such member, or any part of its assets, may be bound, entitled or subject, which
would or might, in each case as a consequence of the Scheme or of the
acquisition or proposed acquisition of all or any part of the issued share
capital of, or change of control or management of, Revenue Assurance or any
other member of the Wider Revenue Assurance Group reasonably be expected to
result (in each case to an extent which is material to Spice in the context of
the Scheme or, as the case may be, in the context of the Wider Revenue Assurance
Group taken as a whole) in:
3.5.1 any material assets or interests of any member of the Wider
Revenue Assurance Group being or falling to be disposed of or charged in
any way or ceasing to be available to any member of the Wider Revenue Assurance
Group or any rights arising under which any such asset or interest could be
required to be disposed of or charged in any way or could cease to be available
to any member of the Wider Revenue Assurance Group otherwise than in the
ordinary course of business; or
3.5.2 any moneys borrowed by or other indebtedness (actual or
contingent) of, or any grant available to, any member of the Wider Revenue
Assurance Group being or becoming repayable or capable of being declared
repayable immediately or earlier than the repayment date stated in such
agreement or the ability of such member of the Wider Revenue Assurance Group to
incur any such borrowing or indebtedness becoming or being capable of becoming
withdrawn, inhibited or prohibited; or
3.5.3 any such agreement or the rights, liabilities, obligations or
interests of any such member under it being terminated or adversely modified
or affected or any onerous obligation arising or any adverse action being
taken under it; or
3.5.4 the interests or business of any such member in or with any
third party (or any arrangements relating to any such interests or business)
being terminated or adversely modified or affected; or
3.5.5 the financial or trading position of any member of the Wider
Revenue Assurance Group being prejudiced or adversely affected; or
3.5.6 the creation of any mortgage, charge or other security interest
over the whole or any part of the business, property or assets of any
member of the Wider Revenue Assurance Group or any such security (whenever
arising or having arisen) becoming enforceable or being enforced; or
3.5.7 any member of the Wider Revenue Assurance Group ceasing to be able
to carry on business under any name under which or on the terms on which
it currently does so or any person presently not able to carry on business
under any name under which any member of the Wider Revenue Assurance Group
currently does becoming able to do so; or
3.5.8 the creation of actual or contingent liabilities by any member
of the Wider Revenue Assurance Group;
and no event having occurred which, under any provision of any such agreement to
which any member of the Wider Revenue Assurance Group is a party, or by or to
which any such member, or any of its assets, may be bound, entitled or subject,
could result , to an extent which is material to Spice in the context of the
Scheme or, as the case may be in the context of the Wider Revenue Assurance
Group taken as a whole, in any of the events or circumstances as are referred to
in subparagraphs 3.5.1 to 3.5.8 inclusive;
3.6 No Corporate Action Taken Since The Accounting Date
since the Accounting Date, save as otherwise Disclosed or pursuant to
transactions in favour of Revenue Assurance or a wholly-owned subsidiary of
Revenue Assurance or otherwise pursuant to the Scheme, no member of the Wider
Revenue Assurance Group having:
3.6.1 issued or agreed to issue or authorised or proposed the
issue or grant of additional shares 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 pursuant to the Revenue
Assurance Share Schemes); or
3.6.2 redeemed, purchased, repaid or reduced or proposed the redemption,
purchase, repayment or reduction of any part of its share capital or
made or proposed the making of any other change to its share capital; or
3.6.3 save in relation to the final dividend declared by Revenue
Assurance in respect of the year ended 31 March 2007, recommended,
declared, paid or made or proposed to recommend, declare, pay or make any
dividend, bonus issue or other distribution whether payable in cash or
otherwise; or
3.6.4 merged or demerged with or from, or acquired, any body corporate
or authorised or proposed or announced any intention to propose any
such merger or demerger; or
3.6.5 other than in the ordinary course of business acquired or disposed
of, transferred, mortgaged or charged, or created or granted any security
interest over, any assets (including shares and trade investments) or
authorised or proposed or announced any intention to propose any acquisition,
disposal, transfer, mortgage, charge or creation or grant of any security
interest (which in any case is material in the context of the Wider Revenue
Assurance Group taken as a whole); or
3.6.6 issued or authorised or proposed the issue of any debentures or
incurred or save in the ordinary course of business increased any
borrowings, indebtedness or liability (actual or contingent) of any aggregate
amount which is material in the context of the Wider Revenue Assurance Group
taken as a whole; or
3.6.7 entered into or varied, or authorised or proposed the entry into
or variation of, or announced its intention to enter into or vary,
any transaction, arrangement, contract or commitment (whether in respect of
capital expenditure or otherwise) which is of a long term, onerous or unusual
nature or magnitude or could involve an obligation of such nature or magnitude
or which is or could be restrictive to the existing business of any member of
the Wider Revenue Assurance Group or which is other than in the ordinary course
of business and which in any such case is material in the context of the Wider
Revenue Assurance Group taken as a whole; or
3.6.8 entered into, implemented, effected, authorised or proposed or
announced its intention to enter into, implement, effect, authorise
or propose any contract, reconstruction, amalgamation, scheme, commitment or
other transaction or arrangement otherwise than in the ordinary course of
business and which is material in the context of the Wider Revenue Assurance
Group taken as a whole; or
3.6.9 waived or compromised any claim which is material in the
context of the Wider Revenue Assurance Group taken as a whole; or
3.6.10 entered into or varied or made any offer (which remains open
for acceptance) to enter into or vary the terms of any contract with any of
the directors or senior executives of Revenue Assurance or (to the extent it is
material in the context of the Wider Revenue Assurance Group taken as a whole)
any of the directors or senior executives of any other member of the Wider
Revenue Assurance Group; or
3.6.11 taken or proposed any corporate action or had any legal proceedings
instituted or threatened against it or petition presented for its
winding-up (voluntary 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 for
any analogous proceedings or steps in any jurisdiction or for the appointment of
any analogous person in any jurisdiction which in any case is material in the
context of the Wider Revenue Assurance Group taken as a whole; or
3.6.12 been unable, or admitted in writing that it is unable, to pay
its debts or has stopped or suspended (or threatened to stop or suspend)
payment of its debts generally or ceased or threatened to cease carrying on all
or a substantial part of its business, in any case which is or would be material
in the context of the Wider Revenue Assurance Group taken as a whole; or
3.6.13 made any alteration to its memorandum or articles of association,
or other incorporation documents; or
3.6.14 in relation to the pension schemes established for its directors
and/or other employees and/or their dependants, made or consented to
any change, in any case which is or would be material in the context of the
Wider Revenue Assurance Group taken as a whole, to:
3.6.14.1 the terms of the trust deeds constituting such pension
schemes or to the benefits which accrue;
3.6.14.2 the pensions which are payable, under them;
3.6.14.3 the basis on which qualifications for or accrual of
or entitlement to such benefits or pensions are calculated or determined;
3.6.14.4 the basis upon which the liabilities (including pensions)
of such pension schemes are funded or made;
3.6.14.5 or agreed or consented to any change to the trustees
of such pension schemes; or
3.6.15 entered into any agreement 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 3.6;
3.7 Other Events Since the Accounting Date
in the period since the Accounting Date, save as Disclosed:
3.7.1 no litigation or arbitration proceedings, prosecution,
investigation or other legal proceedings having been announced, instituted,
threatened or remaining outstanding by, against or in respect of, any member of
the Wider Revenue Assurance Group or to which any member of the Wider Revenue
Assurance Group is or may become a party (whether as claimant, respondent or
otherwise) which is material in the context of the Wider Revenue Assurance Group
taken as a whole; or
3.7.2 no adverse change or deterioration having occurred in
the business or assets or financial or trading position, assets or profits of
any member of the Wider Revenue Assurance Group which is material in the context
of the Wider Revenue Assurance Group taken as a whole; or
3.7.3 no enquiry or investigation by, or complaint or reference
to, any relevant person against or in respect of any member of the
Wider Revenue Assurance Group having been threatened in writing, announced,
implemented or instituted or remaining outstanding by, against or in respect of,
any member of the Wider Revenue Assurance Group which in any such case is
material in the context of the Wider Revenue Assurance Group taken as a whole;
or
3.7.4 no contingent or other liability having arisen or become
apparent or increased which is material in the context of the Wider Revenue
Assurance Group taken as a whole;
3.8 Environmental and Other Issues
save as Disclosed, Spice not having discovered that:
3.8.1 Environmental
3.8.1.1 any past or present member of the Wider Revenue Assurance
Group has not complied in a material respect with all applicable
legislation or regulations or authorisations of any jurisdiction with regard to
the use, handling, storage, transport, production, supply, treatment, keeping,
disposal, discharge, spillage, leak or emission of any waste or hazardous
substance or any substance likely to damage or impair the environment or harm
human health or otherwise relating to environmental matters or the health and
safety of any person or that there has otherwise been any such use, handling,
storage, transport, production, supply, treatment, keeping, disposal, discharge,
spillage, leak or emission (whether or not the same constituted a non-compliance
by any person with any such legislation or regulations or authorisations and
wherever the same may have taken place), which, in any such case, would be
likely to give rise to any liability (whether actual or contingent) or cost on
the part of any member of the Wider Revenue Assurance Group which is material in
the context of the Wider Revenue Assurance Group taken as a whole; or
3.8.1.2 there has been a material disposal, discharge, release,
spillage, leak or emission of any waste or hazardous substance or any
substance reasonably likely to damage or impair the environment or harm human
health which would be likely to give rise to any liability (whether actual or
contingent) or cost on the part of any member of the Wider Revenue Assurance
Group which is material in the context of the Wider Revenue Assurance Group
taken as a whole; or
3.8.1.3 there is, or is likely to be any liability (whether actual
or contingent) or cost on the part of any member of the Wider
Revenue Assurance Group to make good, repair, reinstate or clean up any relevant
asset or any other property or any controlled waters under any environmental
legislation, regulation, notice, circular, order or other lawful requirement of
any relevant person or third party or otherwise which is material in the context
of the Wider Revenue Assurance Group taken as a whole;
3.8.2 Information
the financial, business or other information Disclosed at any time by any member
of the Wider Revenue Assurance Group, whether publicly or in the context of the
Scheme, either contained a material misrepresentation of fact or omitted to
state a fact necessary to make the information disclosed not materially
misleading and such information not being subsequently corrected or remedied;
3.8.3 Intellectual Property
3.8.3.1 any member of the Wider Revenue Assurance Group does not
own or have licensed to it or otherwise possess legally enforceable
rights to use all intellectual property that is:
(a) required or reasonably necessary for the conduct of business
of the relevant member of the Wider Revenue Assurance Group as currently
conducted; or
(b) under development for such business;
and, in either case, the absence of which, individually or in the aggregate,
would be material in the context of the Wider Revenue Assurance Group taken as a
whole; or
3.8.3.2 any member of the Wider Revenue Assurance Group has infringed
any intellectual property rights of any third party where the
consequences of which would be material in the context of the Wider Revenue
Assurance Group taken as a whole; or
3.8.3.3 any claims have been asserted in writing or threatened in
writing by any person:
(a) that the Wider Revenue Assurance Group infringes any intellectual
property of any third party; or
(b) challenging the ownership of any member of the Wider Revenue
Assurance Group of, or the validity or effectiveness of, any of its
intellectual property;
and any such claims are material in the context of the Wider Revenue Assurance
Group taken as a whole; or
3.8.3.4 any intellectual property held by any member of the Wider Revenue
Assurance Group that is material in the context of the Wider Revenue
Assurance Group taken as a whole is not valid and subsisting; or
3.8.3.5 there is material unauthorised use, infringement or misappropriation
of any intellectual property of any member of the Wider Revenue Assurance
Group by any third party; or
3.8.3.6 any persons who are now, or within the last five years have
been, employees, consultants or contractors of any member of the Wider
Revenue Assurance Group have failed to execute proprietary information and
confidentiality agreements, where such failure is material in the context of the
Wider Revenue Assurance Group taken as a whole.
4. Spice may waive (wholly or partly) all or any of the
conditions in paragraph 3 above.
5. If Spice is required by the Panel to make an offer or offers
for the Revenue Assurance Shares under the provisions of Rule 9 of the
City Code, Spice may make such alterations to the terms and conditions of the
Acquisition as may be necessary to comply with the provisions of that Rule.
6. The Acquisition will lapse and the Scheme will not proceed if
before the date of the Court Meeting the Acquisition, or any matter
arising from it, is referred to the Competition Commission.
7. Spice reserves the right to elect to implement the Acquisition
by way of a Takeover Offer. In such event, such offer will be
implemented on the same terms (subject to appropriate amendments, including
(without limitation) an acceptance condition set at 90 per cent. (or such lesser
percentage (being more than 50 per cent.) as Spice may determine) of the shares
to which the offer relates), so far as applicable, as those which would apply to
the Scheme.
Part B
Certain further terms of the Acquisition
Fractions of New Spice Shares will not be allotted and issued to Revenue
Assurance Shareholders pursuant to the Scheme. Fractional entitlements to New
Spice Shares will be aggregated and allotted and issued to a nominee appointed
by Spice as nominee for the Revenue Assurance Shareholders to which such
fractional entitlements apply, sold in the market and the net proceeds of sale
will be distributed pro rata to the Revenue Assurance Shareholders entitled
thereto. However, individual fractional entitlements to amounts (net of
expenses) not exceeding £5.00 will not be paid to persons who would otherwise be
entitled thereto under the Scheme, but will be retained for the benefit of the
Enlarged Group.
Any Revenue Assurance Shares issued pursuant to the exercise of options or
awards under the Revenue Assurance Share Schemes or pursuant to the exercise of
the Warrants prior to the Reorganisation Record Time will be subject to the
Scheme. Pursuant to the Scheme, the Articles will be amended to ensure that any
Revenue Assurance Share allotted and issued pursuant to the exercise of an
option or award under the Revenue Assurance Share Schemes or pursuant to the
exercise of the Warrants (which are not subject to the Scheme) will be
automatically transferred to, and purchased by, Spice (or its nominee(s)) for
0.1309 of a New Spice Share and 125.5 pence in Cash Consideration.
The New Spice Shares will be allotted and issued credited as fully paid and will
rank pari passu in all respects with the Spice Shares in issue at the time the
New Spice Shares are allotted and issued pursuant to the Acquisition, including
the right to receive and retain dividends and other distributions declared, made
or paid by reference to a record date falling after the Effective Date.
Application will be made to the London Stock Exchange for the New Spice Shares
to be admitted to trading on AIM.
APPENDIX 2
BASES AND SOURCES OF INFORMATION
1. Unless otherwise stated:
• financial information relating to Spice has been extracted or derived
(without any adjustment) from the audited financial results for the year
ended 29 April 2007; and
• financial information relating to Revenue Assurance has been extracted or
derived (without any adjustment) from the audited financial results for
the year ended 31 March 2007.
2. The value of Revenue Assurance based on the Acquisition is calculated:
• by reference to a price of 615 pence per Spice Share (being the Closing
Price of a Spice Share on 27 July 2007, the last business day prior to the
date of this Announcement); and
• on the basis of the fully diluted number of Revenue Assurance Shares in
issue referred to in paragraph 4 below.
3. In accordance with Rule 2.10 of the City Code, Spice confirms that as at the
close of business on 27 July 2007, the last business day prior to the date
of this Announcement, Spice had in issue 53,466,645 Spice Shares
(ISIN GB00B01YR877).
4. The fully diluted share capital of Revenue Assurance (being 49,966,510
Revenue Assurance Shares) is calculated on the basis of:
• the number of issued Revenue Assurance Shares on 27 July 2007, the last
business day prior to the date of this Announcement, being 42,722,745
Revenue Assurance Shares; and
• the 4,890,824 Revenue Assurance Shares subject to options and awards
outstanding under the Revenue Assurance Share Schemes and the Warrants
on 27 July 2007, the last business day prior to the date of this
Announcement, and which are either capable of exercise or will become
capable of exercise prior to the Reorganisation Record Time; and
• the 2,352,941 Revenue Assurance Shares to be issued on 30 September 2007
as deferred consideration in connection with the acquisition of
UBM Limited.
5. The premium calculations to the price per Revenue Assurance Share in this
Announcement have been calculated by reference to the Closing Price of 615
pence of a Spice Share, being the Closing Price on 27 July 2007, the last
business day prior to the date of this Announcement.
6. The percentage that Revenue Assurance Directors will be interested in, in
aggregate, of Spice's enlarged issued share capital is calculated on the
following basis:
• by reference to Spice's existing issued share capital of 53,466,645
Spice Shares; and
• by reference to Revenue Assurance's fully diluted share capital as
referred to in paragraph 4 above.
APPENDIX 3
DEFINITIONS
"Accounting Date" 31 March 2007
"Acquisition" the proposed acquisition by Spice of the entire issued
and to be issued share capital of Revenue Assurance
pursuant to the Scheme
"acting in concert" has the meaning set out in the Code
"Admission" the admission of the New Spice Shares to trading on AIM
becoming effective in accordance with the AIM Rules
"agreements" arrangements, agreements, commitments, licences,
permits, franchises, partnerships, joint ventures,
authorisations or other instruments
"AIM" the AIM Market of the London Stock Exchange
"AIM Rules" the AIM Rules for Companies published by the London
Stock Exchange (as amended)
"Announcement" this announcement
"Articles" the articles of association of Revenue Assurance as at
the date of the Scheme and "Article" shall mean any
article of those Articles
"Australia" the commonwealth of Australia, its possessions and
territories and all areas subject to its jurisdiction
or any political subdivision thereof
"authorisations" authorisations, orders, recognitions, grants, consents,
licences, confirmations, clearances, permissions and
approvals
"Bridgewell" Bridgewell Limited
"business day" a day (excluding Saturdays, Sundays and public
holidays) on which banks are generally open for
business in the City of London
"Canada" Canada, its possessions and territories and all areas
subject to its jurisdiction or any political
subdivision thereof
"Capital Reduction" the proposed reduction of the share capital of Revenue
Assurance pursuant to the Scheme
"Cash Consideration" the consideration in cash to which a Scheme Shareholder
would be entitled under the Scheme, including cash
entitlements under the Mix and Match Facility
"Cenkos" Cenkos Securities plc
"Code" or "City Code" The City Code on Takeovers and Mergers, issued by the
Panel on Takeovers and Mergers
"Court" the High Court of Justice in England and Wales
"Closing Price" the closing middle market quotation of a Revenue
Assurance Share (or a Spice Share (as the case may be))
as derived from the AIM Appendix of the Daily Official
List, save that quotations for 27 July 2007 have been
derived from the website of the London Stock Exchange
"Companies Act" the Companies Act 1985 (as amended or re-enacted)
"Competition Commission" the Competition Commission established under the
Competition Act 1998
"Conditions" the conditions to the Scheme and the Acquisition which
are set out in Appendix 1 to this Announcement
"Court Meeting" the meeting of the Scheme Shareholders to be convened
pursuant to an order of the Court pursuant to section
425 of the Companies Act for the purposes of
considering and, if thought fit, approving the Scheme
(with or without amendment) and any adjournment of such
meeting
"Court Orders" the Scheme Court Order and/or the Reduction Court Order
"Daily Official List" the daily official list of the London Stock Exchange
"Disclosed" means: (i) as disclosed in Revenue Assurance's Report
and accounts for the year ended 31 March 2007; (ii) as
publicly announced by Revenue Assurance to a Regulatory
Information Service; (iii) as may be disclosed in the
Scheme Document; or (iv) as fairly disclosed in writing
by or on behalf of Revenue Assurance to Spice or its
advisers
"Effective" in the context of the Acquisition:
(i) if the Acquisition is implemented by
way of the Scheme, the Scheme having become Effective
pursuant to its terms; or
(ii) if the Acquisition is implemented by way
of a Takeover Offer, the Takeover Offer having been
declared or become unconditional in all respects in
accordance with the requirements of the Code
"Effective Date" the date on which the Scheme becomes effective in
accordance with its terms
"Enlarged Group" the Spice Group after completion of the Acquisition
"Extraordinary the extraordinary general meeting of Revenue Assurance
General Meeting" or "EGM" Shareholders as may be convened for the purpose of the
Acquisition, notice of which will be set out in the
Scheme Document, and any adjournment of such meeting
"Form of Election" the form of election relating to the Mix and Match
Facility
"FSA" the Financial Services Authority
"FSMA" the Financial Services and Markets Act 2000 (as
amended)
"holder" a registered holder of shares, including any person
entitled by transmission
"Implementation Agreement" the agreement dated 27 July 2007 between Spice and
Revenue Assurance and relating, among other things, to
the implementation of the Acquisition further details
of which are set out in this Announcement
"Independent Inconsistent
Transaction either:"
(a) an offer, scheme of arrangement,
recapitalisation or other transaction which involves a
change of control (as defined in the Code) of Revenue
Assurance; or
(b) any arrangement or transaction which
involves or contemplates the transfer of any interest
in the whole or a material part of the undertaking,
assets and/or business of Revenue Assurance or the
Revenue Assurance Group,
which is in each case to be made or entered into by a
third party which is not acting in concert with Spice
"Intellectual Property" all patents, trademarks, trade names, service marks,
copyrights, designs, databases and any applications
therefore, schematics, technology, know how, computer
software, programs or applications (in both source code
and object code form), and tangible or intangible
proprietary information or material
"interest" has the meaning set out in the City Code
"Japan" Japan, its possessions and territories and all areas
subject to its jurisdiction or any political
subdivision thereof
"legal proceedings" actions,suits,proceedings,investigations, references or
enquiries
"Listing Rules" the listing rules issued by the FSA under Part VI of
FSMA
"London Stock Exchange" London Stock Exchange plc
"members" members of Revenue Assurance on the register of members
at any relevant date
"Minute" the minute (approved by the Court) showing, as altered
by the Reduction Court Order, the information required
by section 138 of the Companies Act with respect to
Revenue Assurance's share capital
"Mix and Match Facility" the facility under which a Scheme Shareholder (other
than certain Overseas Shareholders) may, subject to
offsetting elections by other Scheme Shareholders,
elect to receive more New Spice Shares or Cash
Consideration in respect of his Scheme Shares than he
would receive absent such an election
"New Spice Shares" the new ordinary shares of 10 pence each in the capital
of Spice Shares to be allotted and issued credited as
fully paid to Scheme Shareholders pursuant to the
Scheme
"Offer Period" the period commencing on 12 July 2007 and ending on the
Effective Date
"Official List" the official list of the UK Listing Authority
"Ordinary Shares" ordinary shares of twenty five pence each in the issued
share capital of Revenue Assurance
"Overseas Shareholders" Scheme Shareholders who are resident in, ordinarily
resident in, or citizens of, jurisdictions outside the
United Kingdom
"Panel" the Panel on Takeovers and Mergers
"pounds", "£", "pence" or "Sterling" the lawful currency of the United Kingdom
"Reduction Court Hearing" the hearing by the Court of the petition to confirm the
Capital Reduction under section 137 of the Companies
Act
"Reduction Court Order" the order of the Court confirming the Capital Reduction
"Registrar of Companies" the Registrar of Companies in England and Wales, within
the meaning of the Companies Act
"Regulatory Information Service" any of the services set out in Appendix 3 to the
Listing Rules
"relevant asset" land, property or other asset now or previously owned,
occupied or made use of by any past or present member
of the Revenue Assurance Group
"relevant persons" governments, governmental, quasi governmental,
supranational, statutory, investigative, regulatory or
administrative bodies or trade agencies, associations,
institutions or courts, or professional or
environmental bodies, or any other persons or bodies
whatsoever in any jurisdiction
"Reorganisation Record Time" 6.00 p.m. on the date on which the office copy of the
Scheme Court Order is delivered to the Registrar of
Companies for registration
"Revenue Assurance" Revenue Assurance Services Plc (registered number
2950904), whose registered office is at 7th Floor, One
Crown Square, Church Street East, Woking, Surrey GU21
6HR
"Revenue Assurance Board" or "Revenue the board of directors of Revenue Assurance
Assurance Directors"
"Revenue Assurance Group" Revenue Assurance, its subsidiaries and subsidiary
undertakings
"Revenue Assurance Shareholders" holders of Revenue Assurance Shares
"Revenue Assurance Shares" (i) up to the Reorganisation Record Time,
the Ordinary Shares; and
(ii) after the Reorganisation Record Time,
the Ordinary Shares, the A Revenue Assurance Shares and
the B Revenue Assurance Shares
"Revenue Assurance Share Schemes" The Revenue Assurance 1999 Approved Executive Share
Option Scheme, the Revenue Assurance 1999 Unapproved
Executive Share Option Scheme, the Revenue Assurance
Long Term Incentive Plan and the Revenue Assurance
Savings Related Share Option Scheme
"Scheme" the scheme of arrangement under section 425 of the
Companies Act between Revenue Assurance and the Scheme
Shareholders to implement the Acquisition, with or
subject to any modification thereof or addition thereto
or condition approved or imposed by the Court and
agreed by Revenue Assurance and Spice
"Scheme Court Hearing" the hearing by the Court of the petition to sanction
the Scheme
"Scheme Court Order" the order of the Court sanctioning the Scheme under
section 425 of the Companies Act
"Scheme Document" the document to be sent by Revenue Assurance to the
Revenue Assurance Shareholders, of which the Scheme
will form part
"Scheme Shareholders" holders of a Scheme Share, and a "Scheme Shareholder"
shall mean any one of these Scheme Shareholders
"Scheme Shares" Revenue Assurance Shares:
(i) in issue at the date of the Scheme
Document;
(ii) issued after the date of the Scheme
Document, but before the Voting Record Time; and
(iii) issued at or after the Voting Record Time
but before the Reorganisation Record Time on terms that
the original or any subsequent holders are, or shall
have agreed in writing to be, bound by the Scheme
"securities" shares and securities convertible into, or rights to
subscribe for, shares, options (including traded
options) in respect thereof and derivatives referenced
thereto
"Securities Act" the United States Securities Act 1933, as amended and
the rules and regulations promulgated under such Act
"Special Resolution" the special resolution to be proposed at the
Extraordinary General Meeting
"Spice" Spice PLC (registered number 3250709), whose registered
office is at Wellfield House, Victoria Road, Morley,
Leeds LS27 7PA
"Spice Board" or "Spice Directors" the board of directors of Spice
"Spice Group" Spice, its subsidiaries and subsidiary undertakings
"Spice Shareholders" the holders of Spice Shares
"Spice Shares" ordinary shares of 10 pence each in the issued share
capital of Spice
"substantial interest" a direct or indirect interest in 20 per cent. or more
of the equity capital of an undertaking
"Takeover Offer" an offer made or to be made by or on behalf of Spice
for the entire issued and to be issued share capital of
Revenue Assurance and, where the context so requires,
any subsequent revision, extension or variation thereof
"third party" any person, firm, company or body
"UK" or "United Kingdom" the United Kingdom of Great Britain and Northern
Ireland
"UK Listing Authority" or "UKLA" the Financial Services Authority acting in its capacity
as the competent authority for the purposes of Part IV
of the Financial Services and Markets Act 2000
"US" or "United States" the United States of America, its territories and
possessions, any state of the United States of America
and the District of Columbia and all other areas
subject to its jurisdiction
"Voting Record Time" 6.00 p.m. on the day which is two days before the date
of the Court Meeting or, if such Court Meeting is
adjourned, 6.00 p.m. on the day which is two days
before the date of such adjourned meeting
"Warrants" the warrants to subscribe for Revenue Assurance Shares
granted to Simon Beart pursuant to three separate
agreements made between Revenue Assurance and Simon
Beart dated 10 July 1998 and 24 February 2004
"Wider Revenue Assurance Group" Revenue Assurance and its subsidiaries, subsidiary
undertakings, associated undertakings and any other
undertakings in which Revenue Assurance and/or such
subsidiaries or undertakings (aggregating their
interests) have a substantial interest
"Wider Spice Group" Spice and its subsidiaries, subsidiary undertakings,
associated undertakings and any other undertakings in
which Spice and/or such subsidiaries or undertakings
(aggregating their interests) have a substantial
interest
This information is provided by RNS
The company news service from the London Stock Exchange
IW