Placing & Open Offer
easyJet PLC
29 October 2001
Embargoed till 06:59 29 October 2001
Not for release, distribution or publication in whole or in part in or into
the United States, Canada, Japan or Australia
easyJet plc ('easyJet' or the 'Company')
PROPOSED PLACING AND OPEN OFFER AND SALE OF SECONDARY SHARES
easyJet ('easyJet' or the 'Company') (LSE: EZJ), the fast-growing low cost
airline, today announces details of a proposed Placing and Open Offer of
26,032,258 new Ordinary Shares ('Ordinary Shares'). easy Group Limited
('easyGroup'), a company indirectly owned by
Stelios Haji-Ioannou, the Chairman of the Company, proposes to sell 13,000,000
Ordinary Shares.
In addition easyJet today announced its audited results for the financial year
ended 30 September 2001.
Highlights of the Placing and Open Offer
* The Company is raising new equity capital in order to take advantage of
possible opportunities for further expansion in the European short haul
airline market that may arise, to further strengthen its balance sheet and
to help fund in part its new aircraft purchases.
* Of the 26,032,258 new Ordinary Shares being issued by the Company,
19,532,258 new Ordinary Shares (7.5 per cent of the existing issued share
capital) are the subject of the Open Offer which is being made on a
pre-emptive basis to Qualifying Shareholders. The balance of 6,500,000 new
Ordinary Shares (just under 2.5 per cent of the existing issued share
capital) is to be placed on a non-pre-emptive basis under the Placing with
institutional investors.
* The Offer Price, which will be the same for the Placing and the Open
Offer, will be determined at the end of a competitive bookbuilding
exercise, and will be announced on or about 2 November 2001.
* The Placing includes 13,000,000 existing Ordinary Shares which are to be
sold by easyGroup at the Offer Price.
* In addition to the shares to be sold by easyGroup in the Placing,
easyGroup will place an additional 19,532,258 existing Ordinary Shares,
which is equal to the number of new Ordinary Shares to be sold in the Open
Offer. easyGroup has undertaken to use the proceeds of this sale to
subscribe without charge for any new Ordinary Shares not taken up by
Qualifying Shareholders under the Open Offer, including all the 13,993,276
shares held by easyJet Holdings that easyJet Holdings is entitled to take
up but has agreed not to take up. easyGroup will thus subscribe for
between 13,993,276 new Ordinary Shares and 19,532,258 new Ordinary Shares,
depending on the level of take up by Qualifying Shareholders under the
Open Offer.
* The number of shares held by persons other than Stelios Haji-Ioannou and
his immediate family following completion of the Placing and Open Offer
will increase from approximately 29.2% at present to between 40.1% and
42.1%, depending on the level of take-up of the Open Offer by Qualifying
Shareholders.
* Credit Suisse First Boston and UBS Warburg are acting as joint lead
managers and joint bookrunners of the Placing and Open Offer.
Commenting on the Placing and Open Offer, Stelios Haji-Ioannou, Chairman, said
today:
'It is clear to us at easyJet that a number of significant opportunities may
now be arising, principally in the form of new slots, planes and routes. We
look forward to welcoming new shareholders into easyJet. As for my own sale,
after six years building this company up I now wish to monetise some of my
investment to invest in my new ventures, although I will still retain a very
significant investment in easyJet and have no present intention to sell any
more shares.'
Enquiries:
easyJet
Ray Webster +44 (0)1582 443345
Chris Walton +44 (0)1582 525336
Credit Suisse First Boston
Richard Crawley +44 (0)20 7888 8888
Andrew Cornthwaite +44 (0)20 7888 8888
UBS Warburg
Charles Otton +44 (0)20 7568 2539
Nic Hellyer +44 (0)20 7568 5668
Press Enquiries
Toby Nicol, easyJet +44 (0)1582-525339
Charles Cook, Grandfield +44 (0)20 7417 4179
Clare Abbot, Grandfield +44 (0)20 7417 4179
An analysts' meeting will be held today, 29 October, at 7.30am at UBS Warburg,
1 Finsbury Avenue, London EC2M 2PP.
This announcement has been issued by and is the sole responsibility of the
Company and has been approved solely for the purposes of s 57 of The Financial
Services Act 1986 by Credit Suisse First Boston and UBS Warburg each of which
is regulated in the UK by The Financial Services Authority. Credit Suisse
First Boston and UBS Warburg are acting exclusively for easyJet in connection
with the placing and open offer and neither is advising nor treating as a
client any other person and, accordingly, will not be responsible to anyone
other than to easyJet for providing the protections afforded to clients of
Credit Suisse First Boston and UBS Warburg or for providing advice in relation
to the contents of this announcement. This press release is not for
distribution in Canada, Australia or Japan. It does not constitute an offer of
securities for sale in Canada, Australia or Japan. Neither this announcement
nor any copy of it may be taken or transmitted into the United States of
America, its territories or possessions, or distributed, directly or
indirectly, in the United States of America, its territories or possessions.
Any failure to comply with this restriction may constitute a violation of
United States securities laws. This announcement is not an offer of securities
for sale in the United States. THE SECURITIES HAVE NOT BEEN REGISTERED UNDER
THE US SECURITIES ACT AND WILL NOT BE OFFERED OR SOLD EXCEPT PURSUANT TO AN
EXEMPTION FROM OR IN A TRANSACTION NOT SUBJECT TO THE REGISTRATION
REQUIREMENTS OF THE US SECURITIES ACT.
Proposed Placing and Open Offer
Introduction
It is proposed that the Company will issue 26,032,258 new Ordinary Shares
under the Placing and Open Offer. Of these shares 19,532,258 new Ordinary
Shares (7.5 per cent of the existing issued share capital) are the subject of
the Open Offer which is being made to Qualifying Shareholders. The balance of
6,500,000 new Ordinary Shares (just under 2.5 per cent of the existing issued
share capital) is to be placed on a non-pre-emptive basis under the Placing
with institutional investors procured by the Managers. All of these shares
will be issued at the Offer Price, which will be determined following a
competitive bookbuilding exercise and which is expected to be announced on or
about 2 November 2001.
The Placing also includes 13,000,000 existing Ordinary Shares which are to be
sold at the Offer Price by easyGroup. Prior to the Placing, easyJet Holdings,
which currently owns 71.6 per cent of the Company, will have been wound up and
the Ordinary Shares held by it will have been distributed to its shareholders,
including easyGroup, Elura Investments Limited, a company controlled by Ray
Webster, easyJet's Chief Executive Officer and companies indirectly owned by
Stelios Haji-Ioannou's brother and sister pro rata to their existing holding
of shares in easyJet Holdings.
easyGroup has also agreed to sell in the Placing a number of additional
existing Ordinary Shares equivalent to the number of new Ordinary Shares that
are the subject of the Open Offer (19,532,258 Ordinary Shares). As part of
this agreement, easyGroup has agreed to subscribe at the Offer Price, without
receiving a fee, for any new Ordinary Shares not taken up by Qualifying
Shareholders under the Open Offer, including the entitlement of easyJet
Holdings. For the purposes of the Open Offer, easyJet Holdings is a Qualifying
Shareholder in respect of the 186,577,020 existing Ordinary Shares held by it
at the close of business on the Record Date and will be entitled to 13,993,276
new Ordinary Shares under the Open Offer, which it will not take up.
The effect of these transactions is that easyGroup will sell 19,532,258
additional Ordinary Shares at the closing of the Placing on or about 7
November 2001 and will then subscribe for between 13,993,276 new Ordinary
Shares and 19,532,258 new Ordinary Shares, depending on the level of take up
by Qualifying Shareholders other than easyJet Holdings under the Open Offer at
the end of the Open Offer (20 November 2001). Accordingly, to the extent that
Qualifying Shareholders other than easyJet Holdings take up their entitlement
under the Open Offer, the aggregate number of Ordinary Shares for which
easyGroup will be required to subscribe at the end of the Open Offer will
reduce, up to a maximum of 5,538,982 Ordinary Shares.
As a result of these transactions, easyGroup's shareholding in the Company at
the completion of the Placing and Open Offer will be reduced to between 27.0
and 29.0 per cent of the enlarged issued share capital of the Company,
depending on the number of new Ordinary Shares subscribed by other
shareholders under the Open Offer.
Following the Placing and the Open Offer the holdings of companies indirectly
owned by each of Stelios Haji-Ioannou's brother and sister will together
represent 30.9 per cent of the enlarged issued share capital resulting from
the Placing and the Open Offer and, when added to the holding of easyGroup,
will represent between 58 and 60 per cent of the enlarged issued share
capital, depending on the take-up of the Open Offer by Qualifying
Shareholders.
easyGroup and companies indirectly owned by each of Stelios Haji-Ioannou's
brother and sister have confirmed to the Managers and the Company that as at
completion of the Placing and Open Offer they will not have any present
intention to sell any further Ordinary Shares in the immediate future. In
addition, the Company has agreed not to issue any further Ordinary Shares for
cash for 6 months following completion of the Placing and the Open Offer
without the consent of the Joint Lead Managers. This will not prevent the
issue of Ordinary Shares in connection with the Company's Share Option Schemes
or any issues for non-cash assets where the allottees agree not to sell any
Ordinary Shares allotted to them for the remainder of the six month period.
Ray Webster, easyJet's Chief Executive Officer, currently intends to sell up
to 500,000 Ordinary Shares in the Company, following completion of the Open
Offer, at a time yet to be determined. Any such sale is intended to be
conducted in an orderly market fashion.
Placing and Open Offer
Under the Placing the Managers are placing 6,500,000 new Ordinary Shares on
behalf of the Company and 32,532,258 existing Ordinary Shares on behalf of the
Selling Shareholders (including the 19,532,258 Ordinary Shares which represent
the maximum number of new Ordinary Shares that easyGroup may be required to
take up following the Open Offer). The Placing Shares will be placed with
institutional investors at the Offer Price.
Under the Open Offer Qualifying Shareholders are being invited to apply for
new Ordinary Shares on the basis of:
3 new Ordinary Shares for every 40 existing Ordinary Shares
held and registered in their names at the close of business on 22 October 2001
(the 'Record Date') at the Offer Price and so in proportion to any number of
existing Ordinary Shares then held.
The Placing and the Open Offer are not conditional on the approval of
shareholders. However, the Placing and the Open Offer are conditional as set
out below.
easyGroup has agreed for no consideration to take up any new Ordinary Shares
not taken up by Qualifying Shareholders under the Open Offer, including all
the 13,993,276 new Ordinary Shares which easyJet Holdings was entitled to take
up but which entitlement it has waived.
Offer Price
The Offer Price will be determined following a competitive bookbuilding
process in connection with the Placing, which is expected to close on or about
1 November 2001. It is expected that the Offer Price will be announced on or
about 2 November 2001 when a further circular stating the Offer Price will be
sent to Qualifying Shareholders. The Offer Price will be published in the
London Gazette on or about 5 November 2001.
It is a condition of the Placing and the Open Offer that the Offer Price is
set at a level not less than 90 per cent of the middle market quotation of the
Ordinary Shares as derived from the Daily Official List of the London Stock
Exchange at the close of business on the dealing day before the announcement
of the Offer Price.
Reasons for the Placing and the Open Offer
The Company is undertaking the Placing and the Open Offer in order to take
advantage of possible opportunities for further expansion in the European
short haul airline market that may arise, to further strengthen its balance
sheet and to help fund in part its new aircraft purchases.
easyJet's strategy for continued growth is dependent on its ability to acquire
additional aircraft and to replace older aircraft in line with its intention
to always have a young fleet. easyJet's existing purchase agreement with
Boeing provides for 32 next generation 737-700 aircraft (of which eight have
now been delivered) over a delivery period up to May 2004 and gives easyJet
purchase rights for 30 more such aircraft but no agreed delivery date. The
Boeing purchase agreement requires substantial payments by easyJet over the
next three years and the proceeds of the Placing and Open Offer are expected
to be used primarily to fund or to support the equity element of the financing
of this fleet expansion.
Following recent world events, a number of European airlines other than
easyJet have announced business cutbacks, route withdrawals and fleet
reductions. As a result, easyJet may be presented with a number of potential
opportunities to accelerate its planned growth, including an increased
availability of take off and landing slots, cheaper aircraft and a larger pool
of pilots available for employment. These developments may allow easyJet to
grow at a faster rate than its firm delivery schedule from Boeing would allow.
As a consequence, easyJet is considering negotiating delivery dates for some
or all of the 30 additional Boeing aircraft for which it has purchase rights,
negotiating the purchase of additional new aircraft from Boeing and obtaining
aircraft from other sources. The Placing and Open Offer will help the Company
to take advantage of these opportunities if they arise.
Conditions of the Placing and Open Offer
The Placing is conditional on:
* The Offer Price having been agreed by easyJet, the Selling Shareholder
and the Joint Lead Managers at a level not less than 90 per cent of the
middle market quotation of the Ordinary Shares as derived from the Daily
Official List of the London Stock Exchange at the close of business on the
dealing day before the Pricing Date;
* Admission of the new Ordinary Shares the subject of the Placing having
taken place (subject only to their allotment) and the commencement of
unconditional dealings on the London Stock Exchange of such new Ordinary
Shares; and
* The Placing Agreement having become unconditional in all respects and
not having been rescinded or terminated prior to the Placing Settlement
Date.
If the Placing does not become unconditional, the Open Offer will be withdrawn
and will terminate and no new Ordinary Shares will be issued and all monies
received by Lloyds TSB Registrars on behalf of the Company in connection with
the Open Offer will be returned to applicants without interest as soon as
practicable thereafter.
The Open Offer is conditional upon:
* The Placing having been completed and the Placing Agreement not having
been rescinded or terminated in accordance with its terms before Admission
of the new Ordinary Shares the subject of the Placing; and
* Admission of the new Ordinary Shares the subject of the Open Offer
having taken place (subject only to their allotment) and the commencement
of dealings on the London Stock Exchange of such new Ordinary Shares.
If the Open Offer does not become unconditional, no new Ordinary Shares will
be issued pursuant to the Open Offer and all monies received by Lloyds TSB
Registrars on behalf of easyJet in connection with the Open Offer will be
returned to applicants without interest as soon as practicable thereafter.
However, if the Placing has been completed and the Open Offer does not become
unconditional, there will be no effect on the completion of the Placing.
Circular
A circular to shareholders containing full details of the Placing and Open
Offer and the results for the year to 30 September 2001 is expected to be
posted later today. Words and expressions defined in the circular shall bear
the same meanings as in this document.
Expected Timetable of Principal Events
2001
Record Date for entitlements under the Open Offer 22 October
Placing book-building closes On or about 1
November
Announcement of Offer Price and Publication of Pricing Circular On or about 2
November
Admission and unconditional dealings commence in the new 7 November
Ordinary Shares included in the Placing
CREST stock accounts credited in respect of the Placing 7 November
Definitive share certificates despatched in respect of the new From 14
Ordinary Shares included in the Placing November
Latest time and date for splitting Application Forms (to 3.00 p.m., 16
satisfy bona fide market claims only) in respect of the Open November
Offer
Latest time and date for receipt of completed Application Forms 3.00 p.m., 20
and payment in full under the Open Offer November
Admission and dealings commence in the new Ordinary Shares, the On or before
subject of the Open Offer 8.00 a.m.,
21 November
CREST stock accounts credited in respect of the Open Offer 26 November
Definitive share certificates despatched in respect of new From 28
Ordinary Shares included in the Open Offer November
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