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W.H. Ireland Group (WHI)

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Monday 02 March, 2009

W.H. Ireland Group

Possible Offer for Blue Oar p

RNS Number : 0873O
W.H. Ireland Group PLC
02 March 2009
 



NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION IN WHOLE OR IN PART INTO ANY OTHER JURISDICTION WHERE TO DO SO WOULD CONSTITUTE A VIOLATION OF THE RELEVANT LAWS OF SUCH JURISDICTION


2 March 2009


Possible Offer by

WH Ireland Group PLC ('WH Ireland')

for 

Blue Oar PLC ('Blue Oar')


Summary

  • The Boards of WH Ireland and Blue Oar are pleased to announce a merger by way of a possible offer to be made by WH Ireland for the entire issued and to be issued share capital of Blue Oar (the 'Possible Offer').

  • The Possible Offer is subject to the waivable pre-conditions set out in paragraph 6 below and is expected to be made by way of a scheme of arrangement.

  • The Possible Offer values each Blue Oar Share at 9.66 pence (to be paid as 1 pence in cash plus 0.1194 New WH Ireland Shares for every one Blue Oar Share).

  • This equates to a value of approximately £16.2 million for the entire issued share capital of Blue Oar, based on the closing price of 72.5 pence per WH Ireland Share on 27 February 2009, and represents a premium of approximately 197 per cent. to the closing price of 3.25 pence per Blue Oar Share on 27 February 2009, being the last business day prior to the date of this Announcement.

  • WH Ireland has received an irrevocable undertaking to vote in favour of (or accept) the Possible Offer from Evolve Capital PLC which holds 108,971,750 Blue Oar Shares representing approximately 64.9 per cent. of Blue Oar's existing issued share capital.

  • The Enlarged Group would hold the following competitive advantages:

  • a leading AIM adviser with a significant number of corporate clients;

  • a well integrated institutional equities business;

  • one of the country's leading regional private client wealth management businesses; and

  • a strong position in the Australian market.

Commenting on the Possible Offer, Richard Ford, Chief Executive of WH Ireland, said:

'Blue Oar would be an excellent strategic fit for WH Ireland, strengthening our core activities of institutional investment banking, asset management and private client stockbroking. An offer on these terms would allow Blue Oar shareholders to retain an interest in a financial services organisation with an excellent platform for growth.'

Commenting on the Possible Offer, Justin Lewis, Chief Executive of Blue Oar, said:

'We are delighted to have agreed the terms of a possible offer with WH Ireland. The proposal provides a significantly enhanced platform to take advantage of dislocation amongst our competitors whilst ensuring we have the financial and operational resources to manage the combined business through the current downturn. In addition it provides an attractive route forward for all the Blue Oar shareholders, clients and employees.'


  1. Introduction

The Boards of WH Ireland and Blue Oar are pleased to announce a merger by way of a possible offer to be made by WH Ireland for the entire issued and to be issued share capital of Blue Oar (the 'Possible Offer').

The Possible Offer is subject to the waivable pre-conditions set out in paragraph 6 below and is expected to be made by way of a scheme of arrangement.


2. Terms of the Possible Offer

It is intended that, if made, the Possible Offer will be made on the following basis:

for every Blue Oar Share, 0.1194 New WH Ireland Shares and 1 pence in cash

The Possible Offer values each Blue Oar Share at 9.66 pence and values the entire issued share capital of Blue Oar at approximately £16.2 million, based on the closing price of 72.5 pence per WH Ireland Share on 27 February 2009. The price represents a premium of approximately 197 per cent. to the closing price of 3.25 pence per Blue Oar Share on 27 February 2009, being the last business day prior to the date of this Announcement.

Blue Oar's largest shareholder, Evolve Capital PLC ('Evolve'), which has an interest in approximately 64.9 per cent. of Blue Oar's existing issued share capital, is fully supportive of the Possible Offer. WH Ireland has received an irrevocable commitment from Evolve to vote in favour of (or accept) the Possible Offer in respect of Evolve's entire shareholding of 108,971,750 Blue Oar Shares, representing approximately 64.9 per cent. of the existing issued Blue Oar share capital. Further details of this irrevocable commitment are set out in paragraph 8 below.

WH Ireland and Blue Oar emphasise that this announcement does not constitute a firm intention to make an offer pursuant to Rule 2.5 of the Code and there can be no certainty that the Possible Offer will be made on the terms described herein, or at all, even if the preconditions are satisfied or waived.


3. Background to and Reasons for the Possible Offer

WH Ireland is one of the largest regional stockbroking firms in the UK and is involved principally in institutional and private client stockbroking, corporate finance, asset management and private wealth management. Blue Oar, whose principal office is in London, is an investment bank which is involved in institutional stockbroking and the provision of research and investment banking services to its clients and, through its subsidiary Rowan Dartington & Co Limited, private client wealth management.

The Boards believe that WH Ireland and Blue Oar are highly complementary, and a combination would enable WH Ireland to expand significantly its client base in each of its principal business areas; institutional stockbroking, private client wealth management and Australian operations.

The Enlarged Group would hold the following competitive advantages:

  • a leading AIM adviser with a significant number of corporate clients;

  • a well integrated institutional equities business;

  • one of the country's leading regional private client wealth management businesses; and

  • a strong position in the Australian market.

The combination of the respective teams of employees and financial resources available to the Enlarged Group would provide an excellent platform for further growth. The Boards also anticipate that within the Enlarged Group there will be potential for cost savings and synergies to be realised over time.


4. Information on Blue Oar

Blue Oar, founded in 1995, whose principal office is in London, is an investment bank and the holding company of five distinct regulated financial services businesses:

  • Blue Oar Securities PLC                     Institutional investment banking

  • Rowan Dartington & Co Limited        Private client stockbroking with a focus in South West England

  • Astaire & Partners Limited                  Agency stockbroking and private client investment management

  • Blue Oar Asset Management LLP      Wholesale funds management

  • Inteq Limited                                          Australian based corporate advisory firm

Blue Oar's accounts for the year ended 31 December 2007 showed income of £17.2 million (2006: £15.0 million), pre tax profits of £1.9 million (2006: £1.3 million) and net assets of £34.1 million (2006: £29.2 million). Its results for the six months to 30 June 2008 showed a loss before tax of £1.6 million on reduced turnover.  As announced in the trading update of 30 January 2009 cash balances of Blue Oar as at 31 December 2008 were in excess of £13 million.

The shares of Blue Oar are admitted to trading on AIM.


Blue Oar has 167,933,601 ordinary shares of 0.1 pence each in issue as at the date of this announcement, with ISIN GB0031792194. This information is given in accordance with Rule 2.10 of the Code.


5. Information on WH Ireland

WH Ireland is one of the largest independent regional stockbroking houses in the UK. WH Ireland provides investment services to institutions, private individuals and companies, and its activities include institutional investment banking, corporate finance asset management and private client stockbroking. The Company has 14 offices in the UK including Manchester, London, Birmingham, Bristol, Cardiff, Colwyn Bay and Leeds, as well as an Australian subsidiary in Perth, Western Australia.  

For the year ended 30 November 2007, turnover was £42.7 million (2006: £30.3 million), net income was £2.6 million (2006: £2.4 million), pre tax profits were £3.8 million (2006: £3.7 million) and net assets were £19.7 million (£15.4 million). In the six month period to 31 May 2008, turnover was £16.2 million and pre tax losses were £685,000.  

The shares of WH Ireland are admitted to trading on AIM.

WH Ireland has 20,866,958 ordinary shares of 5p each in issue as at the date of this Announcement (excluding shares held in treasury), with ISIN GB0009241885. This information is given in accordance with Rule 2.10 of the Code. 

Upon completion of the Possible Offer WH Ireland intends to cancel its treasury shares currently in issue.


6. Pre-conditions to the announcement of a firm offer

The announcement of a firm intention to make an offer for Blue Oar pursuant to Rule 2.5 of the Code is subject to satisfaction of the following waivable pre-conditions including:

(i)                   the satisfactory completion of due diligence by WH Ireland and Blue Oar;
(ii)                 the unanimous recommendation of the Board of Blue Oar; and
(iii)                final WH Ireland Board approval.

Any offer for Blue Oar would be subject to terms and conditions customary for a recommended offer for a public company governed by the Code. 


7. Other

Pursuant to Rule 2.4(c) of the Code WH Ireland reserves the right to:

  

(i)                   make an offer at a lower price per Blue Oar Share (including by varying the form and/or mix of consideration) with the recommendation of the Board of Blue Oar;
 
(ii)                 vary the form and/or mix of consideration of any offer that may be made; and/or
 
(iii)                waive any of the pre-conditions to the making of an offer referred to above.


Any offer would extend, subject to the terms and conditions of such offer, to any Blue Oar Shares unconditionally allotted or issued on the date on which an offer is made and to any further Blue Oar Shares unconditionally allotted or issued while that offer remains open for acceptances (or such earlier date as WH Ireland may, subject to the Code, decide).


For the purpose of Note 14(d) to Rule 8 of the Code, the value and material terms of the Possible Offer in respect of which the irrevocable commitment has been procured, are those of the Possible Offer.  



8. Irrevocable commitment 

WH Ireland has received an irrevocable commitment from Evolve to vote in favour of (or accept) the Possible Offer in respect of Evolve's entire holding of 108,971,750 Blue Oar Shares, representing approximately 64.9 per cent. of the existing issued Blue Oar share capital.

The irrevocable commitment is binding in the event that the Possible Offer is implemented by way of a scheme of arrangement ('Scheme') or an offer, and in the event of a higher competing offer for Blue Oar. The irrevocable commitment will cease to be binding:

(i)                   if acceptance of the Possible Offer by Evolve is not approved by an ordinary resolution (or ordinary resolutions) passed by the requisite majority (whether on a show of hands or on a poll) at a properly convened and quorate general meeting of Evolve; or
(ii)                 if the directors of Blue Oar fail to propose the Scheme or to recommend the Offer by 12 noon on 9 March 2009, or if an announcement of a firm intention to make the Possible Offer under Rule 2.5 of the Code is not made by 12 noon on 9 March 2009; or
(iii)                if irrevocable undertakings to vote in favour of the Scheme (in substantially the same form as the irrevocable commitment from Evolve) in respect of no less than 10.11 per cent. of the issued share capital of Blue Oar (excluding the number of Blue Oar Shares held by Evolve) have not been received by WH Ireland by 12 noon on 9 March 2009 unless prior to such date WH Ireland has agreed to implement the Possible Offer by way of an offer; or
(iv)                in the event of the Possible Offer being structured by way of a Scheme, after a period of 1 month following the date on which the Scheme does not become effective, unless prior to such date WH Ireland publicly announces that it is making the Possible Offer (or an offer on such terms and conditions as may be agreed with Evolve and Blue Oar and the Panel confirms its consent to such an offer); or
(v)                  in any event, on 15 June 2009.


__________________________________________________________________________________________

Enquiries:

WH Ireland                                                         Tel: 020 7220 0475
Richard Ford

Blue Oar                                                              Tel: 020 7448 4400
Justin Lewis

Bernie Leaver

Daniel Stewart                                                   Tel: 020 7776 6500
Lindsay Mair

Paul Shackleton

Charlotte Stranner

Biddicks (Financial PR to WH Ireland)          Tel: 020 7448 1000
Zoe Biddick

Smithfield (Financial PR to Blue Oar)            Tel: 020 360 4900
Reg Hoare


Daniel Stewart has given its written consent to the release of this Announcement containing references to its name in the form and context in which they appear.

The WH Ireland Directors accept responsibility for the information contained in this Announcement in relation to WH Ireland. To the best of the knowledge and belief of the WH Ireland Directors (who have taken all reasonable care to ensure that such is the case), the information contained in this Announcement for which they accept responsibility is in accordance with the facts and does not omit anything likely to affect the import of such information.

The Blue Oar Directors accept responsibility for the information contained in this Announcement in relation to Blue Oar. To the best of the knowledge and belief of the Blue Oar Directors (who have taken all reasonable care to ensure that such is the case), the information contained in this Announcement for which they accept responsibility is in accordance with the facts and does not omit anything likely to affect the import of such information.


Forward Looking Statements

This Announcement contains certain forward-looking statements with respect to (amongst other things) the financial condition, results of operations and business of Blue Oar and WH Ireland and certain plans and objectives of the WH Ireland Board. These forward-looking statements, without limitation, can be identified by the fact that they do not relate only to historical or current facts. Forward-looking statements often use words such as 'anticipate', 'Blue Oar', '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 in 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, which are not guarantees of future performance.  

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. The Boards assume no obligation to update or correct the information contained in this Announcement, whether as a result of new information, future events or otherwise, except to the extent legally required.

The statements contained in this Announcement are made as at the date of this Announcement, unless some other time is specified in relation to them, and service of this Announcement shall not give rise to any implication that there has been no change in the facts set out in this Announcement since such date. Nothing contained in this Announcement shall be deemed to be a forecast, projection or estimate of the future financial performance of Blue Oar or WH Ireland except where expressly stated.  


Dealing Disclosure Requirements

The disclosure requirements are set out in more detail in Rule 8 of the Code. In particular, under the provisions of Rule 8.3 of the Code, if any person is, or becomes, 'interested' (directly or indirectly) in one per cent. or more of any class of 'relevant securities' of Blue Oar or WH Ireland, 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. (London time) on the Business Day following the date of the relevant transaction. This requirement will continue until the date on which the offer becomes, or is declared, unconditional as to acceptances, lapses or is otherwise withdrawn or on which the offer period otherwise ends. If two or more persons act together pursuant to an agreement or understanding, whether formal or informal, to acquire an 'interest' in 'relevant securities' of Blue Oar or WH Ireland, they will be deemed to be a single person for the purpose of Rule 8.3 of the Code.

Under the provisions of Rule 8.1 of the Code, all 'dealings' in 'relevant securities' of Blue Oar or WH Ireland by WH Ireland or Blue Oar, or by any of their respective 'associates' (within the meaning of the Code), must also be disclosed by no later than 12.00 p.m. (London time) on the 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 Code, which can also be found on the Panel's website. If you are in any doubt as to whether or not you are required to disclose a 'dealing' under Rule 8 of the Code, you should consult the Panel.  

If you are in any doubt as to the application of Rule 8 to you, please contact an independent financial adviser authorised under the Financial Services and Markets Act 2000, consult the Panel's website at www.thetakeoverpanel.org.uk or contact the Panel on telephone number +44 (020) 7638 0129; fax: +44 (020) 7236 7013.

This Announcement does not constitute, or form part of, an offer or invitation to purchase any securities.


APPENDIX I 


Bases and Sources


In this Announcement, unless otherwise stated or the context otherwise requires, the following bases and sources have been used:

1.      Value of the Possible Offer

The Possible Offer values the entire issued share capital of Blue Oar at approximately £16.2 million, based on the Possible Offer terms of 0.1194 New WH Ireland Shares for each Blue Oar Share, based on the closing price of 72.5 pence for a WH Ireland Share on 27 February 2009 being the last business day prior to the date of this Announcement. 


2.     Share prices

The prices of Blue Oar Shares on a particular date are derived from the closing price for that date. 


3.    Time

All the times referred to in this Announcement are London times.

APPENDIX II

Definitions

The following definitions apply throughout this Announcement unless the context requires otherwise: 

'AIM' 

the AIM market operated by the London Stock Exchange


'Announcement'


this announcement made in accordance with Rules 2.4 and 2.10 of the City Code


'Blue Oar'

Blue Oar PLC


'Blue Oar Shares' 

the existing unconditionally allotted or issued and fully paid ordinary shares of 0.1p each in the capital of Blue Oar


'Boards'

the boards of directors of Blue Oar and WH Ireland


'Code'

the City Code on Takeovers and Mergers


'Daniel Stewart'

Daniel Stewart & Company PLC


'Enlarged Group' 

the WH Ireland Group following completion of the Possible Offer;


'FSMA'


the Financial Services and Markets Act 2000 (as amended)

'London Stock Exchange' 

London Stock Exchange PLC




'New WH Ireland Shares' 

the new WH Ireland Shares proposed to be issued credited as fully paid as consideration pursuant to the Possible Offer


'Possible Offer' 

the possible offer by WH Ireland to acquire the entire issued and to be issued share capital of Blue Oar, whether by way of scheme of arrangement or offer


'WH Ireland' or the 'Company' 

WH Ireland Group PLC


'WH Ireland Board' or the 'WH Ireland Directors' 

the directors of WH Ireland


'WH Ireland Group' 

WH Ireland and its subsidiaries and/or (where the context requires) any one or more of them


'WH Ireland Shares' 

ordinary shares of 5p each in the share capital of WH Ireland with ISIN: GB0009241885




This information is provided by RNS
The company news service from the London Stock Exchange
 
END
 
 
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