Further re Offer for Newbury
Guinness Peat Group PLC
17 January 2008
Not for release, publication or distribution, in whole or in part, in, into or
from the US, Canada or Australia or any jurisdiction where to do so would
constitute a violation of the laws of such jurisdiction.
GPG Acquisitions No. 5 Limited
(a wholly owned subsidiary of Guinness Peat Group plc)
FURTHER RE: CASH OFFER FOR NEWBURY RACECOURSE PLC
17 January 2008
GPG Acquisitions notes the second defence circular, posted on 15 January 2008 by
Newbury Racecourse. The new information published therein succeeds only in
emphasizing the attractions for Shareholders of GPG's Offer. In particular:
1. Although not highlighted, the circular discloses current independent
valuations of Newbury Racecourse's property and business assets and the
taxation payable on disposal of its surplus land assuming there were no
rollover relief on future reinvestment. On this basis Newbury Racecourse's
current pro forma net asset value is £10.55 per Share, some 4 per cent. less
than GPG's premium Offer of £11 per Share.
2. The Newbury Board's proposed 10 year property development project, when
compared to the alternative of seeking planning consent and then disposing
of its surplus land would, even on its own optimistic assumptions, only
produce an extra 43 pence per Share, or a very marginal 3.3 per cent.
increase. This pales into insignificance when weighed against the risks
involved in exposing Newbury Racecourse to the vagaries of the property
market for an extended period and diversifying into a new area of operation
in which its relevant management experience is meagre.
3. Shareholders should note that, notwithstanding the Newbury Board's rhetoric
about the Company's "potential", it remains the case that it has been unable
to confirm that the project will produce net returns to Newbury Racecourse,
in today's monetary terms, in excess of GPG's criterion of £7 per Share.
4. From the Newbury Board's somewhat evasive comments about current trading,
Shareholders can only conclude that for 2007 it will report its fifth
consecutive year of operating losses.
GPG is more convinced than ever that its premium Offer of £11 cash per Newbury
Racecourse Share provides an attractive alternative to the dubious economics and
significant long term risks associated with the Newbury Board's 10 year
development project.
Blake Nixon, Chairman of GPG Acquisitions, said: "The £12.84 net asset value per
Share put on Newbury in the Company's circular is based on questionable
assumptions in respect of future planning consents and the taxation consequences
of a disposal. Taking a less rose-tinted view and making a more realistic
adjustment for the existing tax position produces a figure of £10.55 per Share,
a discount to the GPG Offer. Far from offering Shareholders any reassurance, the
latest document from Newbury serves only to further undermine confidence in the
Newbury Board's ability properly to address the issue of Shareholder value."
ENQUIRIES
GPG Acquisitions No. 5 Limited Tel: (020) 7484 3370
Blake Nixon, Director
Strand Partners Limited Tel: (020) 7409 3494
Simon Raggett
Citigate Dewe Rogerson Tel: (020) 7638 9571
Kevin Smith
OTHER INFORMATION
Terms defined in the document posted to Shareholders on 7 December 2007
containing the formal Offer for Newbury Racecourse have the same meaning in this
announcement.
Copies of the Offer Document, the further circular and the Form of Acceptance
remain available (during normal business hours) from Strand Partners at 26 Mount
Row, London W1K 3SQ and from the offices of Computershare Investor Services PLC,
The Pavilions, Bridgwater Road, Bristol BS99 7NH throughout the period during
which the Offer remains open for acceptance.
Strand Partners, which is authorised and regulated in the United Kingdom by the
Financial Services Authority, is acting exclusively for GPG Acquisitions and no
one else in connection with the Offer and Strand Partners will not regard any
other person as a client in relation to the Offer and will not be responsible to
anyone other than GPG Acquisitions for providing the protections afforded
exclusively to its clients or for providing advice in relation to the Offer, the
contents of this announcement or any transaction or arrangement referred to
herein.
The availability of the Offer to persons not resident in and citizens of the
United Kingdom may be affected by laws of the relevant jurisdictions in which
they are citizens or in which they are resident. Such Overseas Shareholders
should inform themselves about, and observe, any applicable legal or regulatory
requirements of any such relevant jurisdiction. In particular, the Offer is not
being made, directly or indirectly, in, into or from or by the use of the mails
of or any means or instrumentality (including, without limitation, by means of
facsimile transmission, telex, telephone, internet or other forms of electronic
communication) of interstate or foreign commerce of, or by any facility of a
national, state or other securities exchange of, the United States, or in, into
or from Canada or Australia or any other jurisdiction if to do so would
constitute a violation of the relevant laws of such jurisdiction, and the Offer
will not be capable of acceptance by any such use, means, instrumentality or
facility from or within the United States, Canada or Australia or any other
jurisdiction where to do so would constitute a breach of any relevant securities
laws of that jurisdiction. Accordingly, copies of this announcement and the
Offer Document are not being, and must not be, mailed or otherwise distributed
or sent in or into or from the United States, Canada or Australia.
This announcement does not constitute, or form part of, an offer to sell or
purchase or an invitation to purchase or subscribe for any securities or the
solicitation of an offer to sell, purchase or subscribe for any securities,
pursuant to the Offer or otherwise. The Offer will be made solely by way of the
Offer Document and the related Form of Acceptance, contain the full terms and
conditions of the Offer.
This information is provided by RNS
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