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Office2office PLC (OFF)

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Thursday 21 August, 2014

Office2office PLC

Offer by Evo Business Supplies Limited

RNS Number : 7009P
Office2office PLC
21 August 2014
 



Not for release, publication or distribution, in whole or in part, directly or indirectly, in, into or from any jurisdiction where to do so would constitute a violation of the relevant laws or regulations of such jurisdiction.

 21 August 2014

RECOMMENDED CASH OFFER

for

OFFICE2OFFICE PLC

by

EVO BUSINESS SUPPLIES LIMITED

a newly incorporated company owned by the Endless III Funds that are managed by Endless LLP

to be effected by means of a Scheme of Arrangement under Part 26 of the Companies Act 2006

Summary

·     The boards of EVO Business Supplies Limited (EVO) and office2office plc (office2office) are pleased to announce that agreement has been reached on the terms of a recommended cash offer by which the entire issued and to be issued ordinary share capital of office2office will be acquired by EVO (the office2office Acquisition).

·     EVO is a newly incorporated company, owned by the Endless III Funds that are managed by Endless LLP (Endless), which has been formed for the purposes of making the office2office Acquisition and, subject to certain conditions including the Scheme becoming effective, the Vasanta Acquisition.  It is intended that the office2office Acquisition will be implemented by means of a Court-sanctioned scheme of arrangement under Part 26 of the Companies Act, further details of which are contained in the full text of this announcement.

·     Under the terms of the Scheme, each Scheme Shareholder will be entitled to receive 51 pence in cash for each office2office Share, valuing office2office's existing issued and to be issued ordinary share capital at approximately £19.1 million.

·     The price of 51 pence in cash per office2office Share represents a premium of approximately:

-     84.6 per cent. to the Closing Price per office2office Share of 27.63 pence on 20 August 2014, being the last Dealing Day prior to the date of this announcement; and

-     97.1 per cent. to the average Closing Price per office2office Share of approximately 25.88 pence for the six month period ending on 20 August 2014, being the last Dealing Day prior to the date of this announcement.

·     The cash consideration payable by EVO under the terms of the office2office Acquisition will be financed entirely out of funds managed by Endless.

·     EVO has received irrevocable undertakings to vote in favour of the Scheme at the Court Meeting and the Special Resolution to be proposed at the General Meeting from the office2office Directors who hold office2office Shares and certain other office2office Shareholders, namely Aberforth Partners LLP, AXA Investment Managers UK Limited, Nicholas Gerber and Downing LLP, in respect of, in aggregate, 16,230,612 office2office Shares representing approximately 44.7 per cent. of the issued ordinary share capital of office2office on 20 August 2014, being the last practicable date prior to the date of this announcement.  Further details of these irrevocable undertakings are set out in Appendix 2 of this announcement.

·     The office2office Directors, who have been so advised by Rothschild, consider the terms of the office2office Acquisition to be fair and reasonable.  In providing advice to the office2office Directors, Rothschild has taken into account the commercial assessments of the office2office Directors.  Accordingly, the office2office Directors intend unanimously to recommend that office2office Shareholders vote in favour of the Scheme at the Court Meeting and the Special Resolution to be proposed at the General Meeting, as the office2office Directors who hold office2office Shares have irrevocably undertaken to do in respect of their own entire beneficial holdings of 1,052,685 office2office Shares, representing, in aggregate, approximately 2.9 per cent. of the issued share capital of office2office on 20 August 2014, being the last practicable date prior to the date of this announcement.

·     office2office is a major provider of business supplies and outsourced business solutions, primarily to large private and public sector customers, through its Managed Procurement and Business Critical Services activities. The office2office Group employs approximately 900 staff and is headquartered in Norwich.

·     Endless is an independent UK-based private equity manager specialising in the provision of financial investment and operational expertise to mid-market businesses requiring transformational investment.  Since its establishment in 2005, Endless has invested approximately £347.5 million in 43 businesses.

·     Vasanta, a private limited company majority-owned by the Endless II Funds, operates in the business supplies market, offering wholesaling and contract stationery, through a regional distribution network based around three highly automated warehouses and a number of local facilities, with its headquarters based in Sheffield.

·     Subject to certain conditions, including the Scheme becoming effective, EVO will complete the Vasanta Acquisition to create the Enlarged EVO Group.

·     The office2office Acquisition will require the approval of office2office Shareholders and the sanction of the Court.  The office2office Acquisition will, as set out in Appendix 1 of this announcement and the Scheme Document, also be conditional on, among other things, there being no Phase 2 CMA Reference. 

·     The Scheme Document containing further information about the office2office Acquisition and notice of the Court Meeting and notice of the General Meeting will be posted to office2office Shareholders as soon as practicable and, in any event, within 28 days of the date of this announcement.  It is expected that the Scheme will become effective in late October 2014, subject to the satisfaction or waiver of the Conditions.  An expected timetable of principal events will be included in the Scheme Document.

Commenting on the office2office Acquisition, Mathew Deering, a director of EVO, said:

"We believe that office2office is a business with a number of attractive characteristics which will benefit from the operational expertise and financial support of Endless.  Furthermore, the merger with Vasanta makes strong strategic and operational sense.  It provides an exciting opportunity for the combined group to deliver a strong offering to the market going forward."

Commenting on the office2office Acquisition, Jim Cohen, Chairman of office2office, said:

"EVO's recommended cash offer announced today represents a significant premium to office2office's current share price and will provide certainty for our shareholders. Following a review of strategy, we have considered a number of options for office2office's future and have concluded that combining office2office with Vasanta is the best way of creating value for our shareholders."

This summary should be read in conjunction with, and is subject to, the full text of this announcement (including its Appendices).  The Scheme will be subject to the Conditions and certain further terms set out in Appendix 1 of this announcement and to the full terms and conditions to be set out in the Scheme Document.  Appendix 2 of this announcement contains details of the irrevocable undertakings received by EVO in connection with the office2office Acquisition.  Appendix 3 of this announcement contains the sources and bases of certain information contained in this announcement.  Appendix 4 of this announcement contains the definitions of certain terms used in this announcement.

Enquiries:

EVO

+44 (0) 113 210 4000

Mathew Deering

 

 

 

Deloitte Corporate Finance (Financial adviser to EVO and Endless)

+44 (0) 207 936 3000

Byron Griffin / David Smith / Adrian Hargrave

 

 

 

office2office plc

+44 (0) 1603 691 102

Jim Cohen / Simon Moate / Hugh Cawley / Debbie Rodwell

 

 

Rothschild (Financial adviser to office2office)

+44 (0) 113 200 1900

Stephen Griffiths / Matthew Jowett

 

 

 

WH Ireland (Broker to office2office)

+44 (0) 207 220 1666

Adrian Hadden / Nick Field

 

 

MHP Communications (PR adviser to office2office)

+44 (0) 203 128 8100

Reg Hoare / Katie Hunt / Jade Neal




 

Further information

This announcement is for information purposes only and is not intended to and does not constitute, or form part of, any offer or the solicitation of any offer to sell, or an invitation to subscribe for, to purchase, otherwise acquire, subscribe for, sell or otherwise dispose of any securities, or the solicitation of any vote or approval in any jurisdiction, pursuant to the office2office Acquisition or otherwise.

EVO's offer to office2office Shareholders will be made solely by means of the Scheme Document, which will contain the full terms and conditions of the office2office Acquisition, including details of how to vote in respect of the Scheme.  Any vote in respect of the Scheme or other response in relation to the office2office Acquisition should be made only on the basis of the information contained in the Scheme Document.  office2office Shareholders are advised to read the formal documentation in relation to the office2office Acquisition carefully once it has been despatched.

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.

Deloitte Corporate Finance is acting for EVO and Endless and no one else in connection with the office2office Acquisition and will not be responsible to anyone other than EVO and Endless for providing the protections afforded to clients of Deloitte Corporate Finance or for providing advice in relation to the office2office Acquisition, the contents of this announcement or any other matters referred to in this announcement. Deloitte Corporate Finance is a division of Deloitte LLP, which is authorised and regulated in the United Kingdom by the FCA in respect of regulated activities.

Rothschild, which is authorised by the Prudential Regulation Authority and regulated by the FCA and the Prudential Regulation Authority in the United Kingdom, is acting as the sole financial adviser to office2office and no-one else in relation to the subject matter of this announcement and will not be responsible to anyone other than office2office for providing the protections afforded to clients of Rothschild nor for providing advice in relation to the subject matter of this announcement.

Certain terms used in this announcement are defined in Appendix 4 of this announcement.

 

Overseas jurisdictions

The availability of the office2office Acquisition or the release, publication or distribution of this announcement to office2office Shareholders who are not resident in and citizens of the United Kingdom may be restricted by the laws of the relevant jurisdiction in which they are located or of which they are citizens.  Such persons should inform themselves of, and observe, all applicable legal and regulatory requirements of their jurisdictions.  Any failure to comply with the requirements of such jurisdictions may constitute a violation of the securities laws of such jurisdictions.  To the fullest extent permitted by applicable law, the companies and persons involved in the office2office Acquisition disclaim any responsibility or liability for the violation of such restrictions by any person.  This announcement has been prepared for the purposes of complying with English law, the Listing Rules, the rules of the London Stock Exchange and the Code and the information disclosed may not be the same as that which would have been disclosed if this announcement had been prepared in accordance with the laws of jurisdictions other than England and Wales.

The office2office Acquisition will not be made, directly or indirectly, in or into, any Restricted Jurisdiction.  Accordingly, copies of this announcement and formal documentation relating to the office2office Acquisition are not being, and must not be, directly or indirectly, mailed or otherwise forwarded, transmitted, distributed, sent or accessed in or into or from any Restricted Jurisdiction.  Persons receiving this announcement (including, without limitation, custodians, nominees and trustees) should observe these restrictions and must not mail or otherwise forward, transmit, distribute or send it in or into or from any Restricted Jurisdiction.

Notice to US Holders

US Holders should note that the office2office Acquisition relates to the securities of an English company, is subject to UK disclosure requirements (which are different from those of the US) and is proposed to be implemented under a scheme of arrangement provided for under English company law.  A transaction effected by means of a scheme of arrangement is not subject to the tender offer rules under the US Exchange Act and the proxy solicitation rules under the US Exchange Act will not apply to the office2office Acquisition.  Accordingly, the Scheme will be subject to UK disclosure requirements and practices, which are different from the disclosure requirements of the US tender offer and proxy solicitation rules.   The financial information included in this announcement has been, or will have been, prepared in accordance with IFRS (with the exception of financial information provided on Vasanta which has been prepared in accordance with UK GAAP) and thus may not be comparable to financial information of US companies or companies whose financial statements are prepared in accordance with generally accepted accounting principles in the US.  However, if EVO were to exercise its right to implement the acquisition of the office2office Shares by way of a takeover offer, such offer will be made in compliance with applicable US laws and regulations.

 

The receipt of cash pursuant to the office2office Acquisition by a US Holder as consideration for the cancellation of its Scheme Shares pursuant to the Scheme may be a taxable transaction for US federal income tax purposes and under applicable US state and local, as well as foreign and other, tax laws.  Each office2office Shareholder is urged to consult his independent professional adviser immediately regarding the tax consequences of the office2office Acquisition applicable to him.

 

It may be difficult for US Holders to enforce their rights and claims arising out of the US federal securities laws, since EVO and office2office are located in countries other than the US, and some or all of their officers and directors may be residents of countries other than the US.  US Holders may not be able to sue a non-US company or its officers or directors in a non-US court for violations of US securities laws.  Further, it may be difficult to compel a non-US company and its affiliates to subject themselves to a US court's judgement.

 

If EVO were to exercise its right to implement the acquisition of the office2office Shares by way of a takeover offer, EVO or its nominees, or its brokers (acting as agents), could make certain purchases of, or arrangements to purchase, office2office Shares outside of the US, other than pursuant to the takeover offer, in accordance with normal UK practice and pursuant to Rule 14e-5(b) of the US Exchange Act.  These purchases could occur either in the open market at prevailing prices or in private transactions at negotiated prices.  Any information about such purchases would be disclosed as required in the UK, would be reported via a RIS and would be available on the London Stock Exchange website at http://www.londonstockexchange.com/prices-and-news/pricesnews/home.htm.

 

Forward looking statements

This announcement may contain statements which are, or may be deemed to be, "forward-looking statements".  Often, but not always, forward-looking statements can be identified by the use of forward-looking words such as "will", "may", "should", "continue", "believe", "expect", "intend", "anticipate", "forecast", "plan" and "project" or similar expressions.  Such statements reflect the relevant company's or person's current views with respect to future events and are subject to risks, assumptions and uncertainties that could cause the actual results to differ materially from those expressed or implied by such forward-looking statements.

 

Many of these risks, assumptions and uncertainties relate to factors that are beyond the companies' or relevant persons' abilities to control or estimate precisely, including the following: future market conditions, changes in general economic and business conditions, regulatory changes, the behaviour of other market participants, litigation, weak, volatile or illiquid capital and/or credit markets, interest rate and currency value fluctuations, the degree of competition in the geographic and business areas in which EVO and office2office operate and changes in laws or in supervisory expectations or requirements.  Other unknown or unpredictable factors could also cause actual results to differ materially from those in the forward-looking statements.  Neither EVO nor office2office can give any assurance that the forward-looking statements will prove to have been correct.  You should not, therefore, place undue reliance on these forward-looking statements, which speak only as of the date of this announcement.  Neither EVO nor office2office undertakes any obligation to update or revise publicly any of the forward-looking statements set out in this announcement, whether as a result of new information, future events or otherwise, except to the extent legally required.

No profit forecasts or estimates

No statement in this announcement is intended as a profit forecast or estimate for any period and no statement in this announcement should be interpreted to mean that earnings or earnings per share for office2office, as appropriate, for the current or future financial years would necessarily match or exceed the historical published earnings or earnings per share for office2office.

Disclosure requirements of the Code

Under Rule 8.3(a) of the Code, any person who is interested in 1% or more of any class of relevant securities of an offeree company or of any securities exchange offeror (being any offeror other than an offeror in respect of which it has been announced that its offer is, or is likely to be, solely in cash) must make an Opening Position Disclosure following the commencement of the offer period and, if later, following the announcement in which any securities exchange offeror is first identified. An Opening Position Disclosure must contain details of the person's interests and short positions in, and rights to subscribe for, any relevant securities of each of (i) the offeree company and (ii) any securities exchange offeror(s). An Opening Position Disclosure by a person to whom Rule 8.3(a) applies must be made by no later than 3.30 pm (London time) on the 10th Business Day following the commencement of the offer period and, if appropriate, by no later than 3.30 pm (London time) on the 10th Business Day following the announcement in which any securities exchange offeror is first identified. Relevant persons who deal in the relevant securities of the offeree company or of a securities exchange offeror prior to the deadline for making an Opening Position Disclosure must instead make a Dealing Disclosure.

Under Rule 8.3(b) of the Code, any person who is, or becomes, interested in 1% or more of any class of relevant securities of the offeree company or of any securities exchange offeror must make a Dealing Disclosure if the person deals in any relevant securities of the offeree company or of any securities exchange offeror. A Dealing Disclosure must contain details of the dealing concerned and of the person's interests and short positions in, and rights to subscribe for, any relevant securities of each of (i) the offeree company and (ii) any securities exchange offeror, save to the extent that these details have previously been disclosed under Rule 8. A Dealing Disclosure by a person to whom Rule 8.3(b) applies must be made by no later than 3.30 pm (London time) on the Business Day following the date of the relevant dealing.

If two or more persons act together pursuant to an agreement or understanding, whether formal or informal, to acquire or control an interest in relevant securities of an offeree company or a securities exchange offeror, they will be deemed to be a single person for the purpose of Rule 8.3.

Opening Position Disclosures must also be made by the offeree company and by any offeror and Dealing Disclosures must also be made by the offeree company, by any offeror and by any persons acting in concert with any of them (see Rules 8.1, 8.2 and 8.4).

Details of the offeree and offeror companies in respect of whose relevant securities Opening Position Disclosures and Dealing Disclosures must be made can be found in the Disclosure Table on the Takeover Panel's website at www.thetakeoverpanel.org.uk, including details of the number of relevant securities in issue, when the offer period commenced and when any offeror was first identified. You should contact the Panel's Market Surveillance Unit on +44 (0)20 7638 0129 if you are in any doubt as to whether you are required to make an Opening Position Disclosure or a Dealing Disclosure.

Rule 2.10 disclosure

In accordance with Rule 2.10, office2office confirms that, as at the close of business on 20 August 2014, it had 36,308,984 ordinary shares of 1 pence each in issue and admitted to trading on the main market of the London Stock Exchange.  The International Securities Identification Number for office2office Shares is GB00B01GL703.

Information relating to office2office Shareholders

Please be aware that addresses, electronic addresses and certain other information provided by office2office Shareholders, persons with information rights and other relevant persons for the receipt of communications from office2office may be provided to EVO during the Offer Period as required under Section 4 of Appendix 4 to the Code.

Publication on website and hard copies

A copy of this announcement will be made available on office2office's website at www.office2office.co.uk by no later than 12 noon (London time) on the Business Day following the date of this announcement.  For the avoidance of doubt, the contents of that website are not incorporated into, and do not form part of, this announcement. 

 

A hard copy of this announcement will be sent to all office2office Shareholders. office2office Shareholders and persons with information rights may also request a hard copy of this announcement (and any information incorporated by reference in this announcement) by writing to Capita Asset Services, 34 Beckenham Road, Beckenham, Kent, BR3 4TU or by calling 0871 664 0300 (or, if calling from outside the UK, on +44 (0)20 8639 3399). Calls within the UK cost 10 pence per minute plus network extras, lines are open 9:00a.m. - 5:30p.m., Monday to Friday (except English bank holidays). Calls from outside the UK will be charged at the applicable international rate. Should office2office determine not to send copies of certain documents in hard copy form, office2office Shareholders may also request that all future documents, announcements and information sent to them in relation to the office2office Acquisition be in hard copy form.



 

Not for release, publication or distribution, in whole or in part, directly or indirectly, in, into or from any jurisdiction where to do so would constitute a violation of the relevant laws or regulations of such jurisdiction.

21 August 2014

RECOMMENDED CASH OFFER

for

OFFICE2OFFICE PLC

by

EVO BUSINESS SUPPLIES LIMITED

a newly incorporated company owned by the Endless III Funds that are managed by Endless

to be effected by means of a Scheme of Arrangement under Part 26 of the Companies Act 2006

1.         Introduction

The boards of EVO and office2office are pleased to announce that agreement has been reached on the terms of a recommended cash offer by which the entire issued and to be issued ordinary share capital of office2office will be acquired by EVO.  It is intended that the office2office Acquisition will be implemented by way of a Court-sanctioned scheme of arrangement under Part 26 of the Companies Act.  EVO is a newly incorporated company, owned by the Endless III Funds that are managed by Endless, which has been formed for the purposes of making the office2office Acquisition.

2.         The office2office Acquisition

Under the terms of the office2office Acquisition, which will be subject to the satisfaction (or, where applicable, waiver) of the Conditions and to the further terms set out in Appendix 1 of this announcement and the Scheme Document, office2office Shareholders will be entitled to receive:

for each office2office Share                                       51 pence in cash

The terms of the office2office Acquisition value office2office's entire issued and to be issued share capital at approximately £19.1 million.

The price of 51 pence in cash for each office2office Share represents a premium of approximately:

-        84.6 per cent. to the Closing Price per office2office Share of 27.63 pence on 20 August 2014, being the last Dealing Day prior to the date of this announcement; and

-        97.1 per cent. to the average Closing Price per office2office Share of approximately 25.88 pence for the six month period ending on 20 August 2014, being the last Dealing Day prior to the date of this announcement.

3.         Recommendation                   

The office2office Directors, who have been so advised by Rothschild, consider the terms of the office2office Acquisition to be fair and reasonable.  In providing its advice, Rothschild has taken into account the commercial assessments of the office2office Directors.

The office2office Board intends unanimously to recommend that office2office Shareholders vote in favour of the Scheme at the Court Meeting and the Special Resolution to be proposed at the General Meeting, as the office2office Directors who hold office2office Shares have irrevocably undertaken to do in respect of their own entire beneficial holdings of 1,052,685 office2office Shares (representing, in aggregate, approximately 2.9 per cent. of the issued ordinary share capital of office2office on 20 August 2014, being the last practicable date prior to the date of this announcement).

4.         Background to and reasons for the recommendation

In recommending the office2office Acquisition, the office2office Board has taken into account a number of factors including: the structural change and need for consolidation in the office2office Group's principal, but declining, business supplies sector; the current trading and prospects of the office2office Group; the office2office Group's financial position; and the feasibility of other strategic options.

office2office is a major provider of business supplies and outsourced business solutions through its Managed Procurement and Business Critical Services activities.  As previously reported in the office2office Group's 2013 Annual Report and Accounts, the trading environment for Managed Procurement is challenging.  Customer buying habits have changed, with a focus on making smaller purchasing orders on a more frequent basis, buying lower cost products and reducing their direct costs generally.  The office2office Board believes this is a permanent shift in buying behaviour, which has increased the office2office Group's "cost to serve" and negatively impacted the office2office Group's financial performance.

In order to mitigate this structural decline in its core activity, the office2office Group has implemented a strategy to improve the performance of its Managed Procurement activity. This programme, which is well underway, has focused on cutting costs, reducing debt and remodelling the business through changes in its logistics platform.  The office2office Board believes there is also a need for industry consolidation, requiring a material commitment of resources, to reduce costs and duplication in the business supplies sector. Hence, in combination with the operational initiatives described above, the office2office Board decided to explore a number of consolidation opportunities to improve shareholder value.

The office2office Group has also in recent years focused on expanding its Business Critical Services activity, a process which the office2office Board believes has been successful to date.  However, the office2office Group does not have sufficient funds to invest further in this activity in order to fulfil its growth potential while at the same time restructuring the office2office Group's role in the declining business supplies sector.

As stated in the office2office Group's 2013 Annual Report and Accounts, the office2office Group is currently in discussions to refinance its £12.5 million term loan, £3 million revolving credit facilities and £30 million asset-backed lending facility, which are all committed to June 2015.  Whilst these discussions are constructive, the terms and completion of any such refinancing are yet to be finalised.

Ultimately, the office2office Board has concluded that the current strategic opportunity for office2office to combine with Endless' portfolio company, Vasanta, is compelling and that the office2office Acquisition offers office2office Shareholders an attractive premium of 84.6 per cent. to the Closing Price on 20 August 2014, being the last Dealing Day prior to the date of this announcement.

Following careful consideration of the above factors, the office2office Directors intend unanimously to recommend that office2office Shareholders vote in favour of the Scheme at the Court Meeting and the Special Resolution to be proposed at the General Meeting, as the office2office Directors who beneficially hold office2office Shares have irrevocably undertaken to do in respect of their own entire beneficial holdings.

5.         Background to and reasons for the office2office Acquisition

Endless invests in companies that it considers can benefit from the provision of its financial investment and operational expertise.  An example of this investment strategy was the acquisition of a majority equity stake in Vasanta in July 2009.

The EVO Directors consider office2office to have a number of attractive characteristics including its range of products and services, such as the BMC business and the 'closed loop' paper recycling operations, its 'final mile' delivery capabilities and its longstanding relationships with various public sector bodies.

Vasanta operates a well-developed multi-sales channel model, including wholesaling and contract stationery, generating revenues of £415 million in the year ended 31 December 2013.  Vasanta operates a regional distribution network based around three highly automated warehouses and a number of local facilities, with its headquarters based in Sheffield.

Both office2office and Vasanta currently operate in a trading environment that the EVO Directors consider challenging with over-capacity in supply, increasing competition and resulting margin pressure. As an example, end-user demand has been negatively impacted in recent years by adverse economic conditions and a decline in the market for traditional office products due to the impact of technology on the workplace environment.  The development of the internet has created new market entrants, such as Amazon, and new e-commerce platforms that have led to increasing competition.  The EVO Directors believe that a combination of the office2office and Vasanta businesses will be better placed to address these market challenges and therefore, subject to certain conditions, including the Scheme becoming effective, EVO will complete the Vasanta Acquisition to create the Enlarged EVO Group.

In particular, EVO is attracted by the potential to utilise the available logistics capacity currently residing in Vasanta.  The EVO Directors also believe that the Enlarged EVO Group will be better positioned to provide dealer customers with an alternative 'stockless' supply model, through combining office2office's Truline service with Vasanta's warehouse capability.  The combination will, the EVO Directors consider, create a more robust business that is better able to support the Enlarged EVO Group's customers and provide the continued investment in operations required to maintain a strong wholesaler and contract stationer supply channel.

6.         Irrevocable undertakings

EVO has received irrevocable undertakings to vote in favour of the Scheme at the Court Meeting and the Special Resolution to be proposed at the General Meeting from the office2office Directors and certain other office2office Shareholders as described below.

The irrevocable undertakings from the office2office Directors who hold office2office Shares are in respect of their entire beneficial holdings and amount to 1,052,685 office2office Shares, representing, in aggregate, approximately 2.9 per cent. of the issued ordinary share capital of office2office on 20 August 2014, being the last practicable date prior to the date of this announcement.  The irrevocable undertakings from the office2office Directors will cease to be binding in certain circumstances, as set out in Appendix 2 of this announcement, but remain binding if a higher competing offer for office2office is made.

The irrevocable undertakings from Aberforth Partners LLP, AXA Investment Managers UK Limited, Nicholas Gerber and Downing LLP are in respect of 15,177,927 office2office Shares representing, in aggregate, approximately 41.8 per cent. of the issued ordinary share capital of office2office on 20 August 2014, being the last practicable date prior to the date of this announcement.  The irrevocable undertakings from Aberforth Partners LLP, AXA Investment Managers UK Limited, Downing LLP and Nicholas Gerber will cease to be binding in certain circumstances, as set out in Appendix 2 of this announcement.

In total, therefore, EVO has received irrevocable undertakings to vote in favour of the Scheme at the Court Meeting and the Special Resolution to be proposed at the General Meeting in respect of 16,230,612 office2office Shares representing, in aggregate, approximately 44.7 per cent. of the issued ordinary share capital of office2office on 20 August 2014, being the last practicable date prior to the date of this announcement.

Further details of these irrevocable undertakings including the circumstances in which they will cease to be binding are set out in Appendix 2 of this announcement.

7.         Information relating to office2office

 

office2office provides business supplies and outsourced business solutions to its customers under two trading segments, each of which is focused on different market sectors and/or offers distinctly different but complementary services:

 

Managed Procurement

 

·     Banner Business Services provides a range of managed procurement services that deliver sustainable savings through consolidating the provision of office and business supplies

·     Accord is office2office's managed procurement brand that focuses on the SME sector and trades alongside Banner Business Services

·     Truline provides an end-to-end managed supply chain service to independent office and business supplies dealers

 

Business Critical Services

 

·     Banner Managed Communication provides a full range of business communication services that spans the end-to-end process from creative design to fulfillment and response handling, digital marketing and print management enabling customers to outsource any or all of their services

·     Banner Document Services provides customers with both on-site and off-site secure document destruction services, ensuring that as much of the waste material as possible is recycled and remanufactured to produce Banner Closed LoopTM recycled copier papers

 

office2office has approximately 900 employees and is headquartered in Norwich, UK.

In the year ended 31 December 2013, office2office's revenues were £231.9 million, with underlying profit before taxation of £4.2 million (before non-recurring costs, amortisation of intangibles relating to acquisitions and share option charges).

8.         Current trading and prospects of office2office

On 4 July 2014, office2office published its trading update in respect of the period from 1 January 2014 to 30 June 2014.  In that statement, office2office announced that trading for its half year ended 30 June 2014 had been in line with expectations.

office2office expects to publish its half year results for the period from 1 January 2014 to 30 June 2014 on 28 August 2014.  These results will be released through a RIS and will be available on office2office's website (www.office2office.co.uk) and will be despatched to those office2office Shareholders who have requested to receive documentation in hard copy form.  office2office Shareholders should consider the content of the interim results in addition to the financial information released previously by office2office.

9.         Information relating to EVO and Endless

EVO

EVO is a newly incorporated private limited company, owned by the Endless III Funds that are managed by Endless.  EVO has been formed at the direction of Endless for the purposes of making the office2office Acquisition and, subject to certain conditions including the Scheme becoming effective, the Vasanta Acquisition.  EVO has not traded since its date of incorporation, nor has it entered into any obligations other than in connection with the office2office Acquisition and the Vasanta Acquisition.

Endless and the Endless III Funds

Endless was registered as a limited liability partnership with registered number OC316569 under the laws of England and Wales on 7 December 2005.  Endless is an independent UK-based private equity manager specialising in the provision of financial investment and operational expertise to mid-market businesses requiring transformational investment.  Since its establishment in 2005, Endless has invested approximately £347.5 million in 43 businesses.

Endless' primary focus is the provision of transformational investment to mid-market businesses including the acquisition of non-core businesses, investments in turnaround opportunities, financial restructurings and management buy-outs where investment is required to reinvigorate growth.  It generally seeks to invest in UK-headquartered businesses across a range of industries with turnover typically between £20 million and £1 billion.

The Endless III Funds comprise Endless Fund III A LP, Endless Fund III B LP and Endless Fund III C LP which invest in opportunities identified by Endless.  As at 20 August 2014, being the last practicable date prior to the date of this announcement, the Endless III Funds had committed funds of approximately £212 million of which (after taking into account amounts required to fund the cash consideration payable to office2office Shareholders by EVO and to discharge certain costs and expenses associated with the office2office Acquisition and the Vasanta Acquisition) 43.8 per cent. remain available for investment.

10.       Financing of the office2office Acquisition and cash confirmation

The financing in relation to the office2office Acquisition, including the cash consideration payable by EVO to office2office Shareholders, is being financed entirely by the Endless III Funds.  EVO will, in due course, seek to substitute or refinance part of such funding with third-party funding.

Deloitte Corporate Finance, financial adviser to EVO, confirms that it is satisfied that sufficient resources are available to EVO to enable it to satisfy in full the cash consideration payable to office2office Shareholders under the terms of the office2office Acquisition.

11.       Employees, pensions, management and locations

The EVO Directors believe that significant synergy benefits from an Enlarged EVO Group should be achievable as both office2office and Vasanta have a large proportion of their operations in the business supplies and services sector.

Accordingly, following the Scheme becoming effective, the EVO Directors intend to integrate the operations of office2office and Vasanta.  Whilst the EVO Directors have given consideration to how such an integration may best be achieved, detailed integration planning can only take place following a thorough strategic review of office2office's business and activities, its overlap with Vasanta's activities and an understanding of customers' future requirements.  Pending the outcome of such a strategic review, the EVO Directors cannot be certain what, if any, impact there will be on the locations of office2office's places of business or the redeployment of office2office's fixed assets or employees.  The EVO Directors anticipate that such a review would be completed within 12 months of the Scheme becoming effective.

The EVO Directors believe that for the Enlarged EVO Group to be competitive and to offer long-term benefits to customers through a combination of competitive pricing and excellence of service, the Enlarged EVO Group may undergo change in areas such as warehousing, logistics and the efficient delivery of central services.  The EVO Directors expect that office2office's warehousing and distribution function will be an area of focus in the short-term, particularly in view of the pending lease expiries at two of office2office's main distribution sites.

Vasanta has already made significant investments in the business' efficiency and this will be a key and ongoing focus for the Enlarged EVO Group.  Whilst this may, over time, result in a contraction of operational sites and employee numbers in certain areas, it will ultimately facilitate ongoing investment in new products and service areas for the combined business, with a view to seeking to ensure the long-term success and viability of the Enlarged EVO Group and increased opportunities for employees in the medium-term.

As part of the proposed strategic review, the EVO Directors intend to focus on understanding, in more detail, the activities of BMC, which is in a market sector which is new to EVO. The EVO Directors will work closely with BMC's management to establish whether the Enlarged EVO Group can help maximise the performance of the business and how best to achieve its potential, including considering its divestment if appropriate, in a market with strong growth opportunities.

Following the Scheme becoming effective, the existing employment rights of all employees and management of office2office will be fully safeguarded. In addition, EVO intends, following completion of the office2office Acquisition, to comply with all pensions obligations in respect of office2office employees.

Each of the non-executive office2office Directors, being Jim Cohen, David Callear and Chris Batterham, will resign from the office2office Board conditionally upon the Scheme becoming effective and with effect from the Effective Date (and at which time payment will be made in lieu of their notice).

12.       office2office Share Schemes

The office2office Acquisition will extend to any office2office Shares which are issued and fully paid (or credited as fully paid) before the Scheme Record Date, including office2office Shares issued pursuant to the exercise of options under the office2office Share Schemes. Participants in the office2office Share Schemes will be contacted separately regarding the effect of the Scheme on the options they hold under the office2office Share Schemes and appropriate proposals will be made to them in due course.

13.       Structure of the office2office Acquisition

It is intended that the office2office Acquisition will be implemented by means of a Court-sanctioned scheme of arrangement between office2office and the Scheme Shareholders under Part 26 of the Companies Act.  The procedure involves, among other things, an application by office2office to the Court to sanction the Scheme and to confirm the cancellation of the existing office2office Shares through the Capital Reduction. The purpose of the Scheme is to provide for EVO to become the owner of the entire issued and to be issued share capital of office2office.

Upon the Scheme becoming effective, the office2office Shares subject to the Scheme will be cancelled and the reserve arising from such cancellation will be applied in paying up in full a number of New office2office Shares (which is equal, in nominal value, to the number of office2office Shares cancelled) and issuing them to EVO, in consideration of which the holders of those office2office Shares so cancelled will receive 51 pence per Scheme Share held at the Scheme Record Time. office2office will make an application to the Court to sanction the Scheme and then to confirm the related Capital Reduction.

The office2office Acquisition will be subject to the satisfaction or (where relevant) waiver of the Conditions and certain further terms contained in Appendix 1 of this announcement and the Scheme Document and will only become effective if, among other things, the following events occur on or before 14 November 2014 (or such later date (if any) as EVO and office2office may, with the consent of the Panel and the Court (if required), agree):

 

·        a resolution to approve the Scheme is passed by a majority in number of the Scheme Shareholders present and voting (and entitled to vote) at the Court Meeting, either in person or by proxy, representing 75 per cent. or more in value of the Scheme Shares held by those Scheme Shareholders (which, for the avoidance of doubt, excludes EVO and its connected parties);

·        the Special Resolution necessary to implement the Scheme and to sanction the related Capital Reduction is passed by the requisite majority of office2office Shareholders required to pass such a resolution at the General Meeting;

·        the Scheme is sanctioned (with or without modification, on terms agreed by EVO and office2office) and the related Capital Reduction confirmed by the Court; and

·        copies of the Court Orders are delivered to the Registrar of Companies and, if ordered by the Court, the Reduction Court Order is registered by the Registrar of Companies.

The Scheme will also be conditional on there being no Phase 2 CMA Reference and approval of the ICA as more particularly set out in the Conditions.

EVO reserves the right, subject to the consent of the Panel, to elect to implement the office2office Acquisition by way of an Offer.  Subject to the receipt of such consent, in such event the office2office Acquisition would be implemented on substantially 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 EVO may decide or the Panel may require of the office2office Shares to which the Offer relates), so far as applicable, as those which would apply to the Scheme.

If the office2office Acquisition is effected by way of an Offer and such Offer becomes or is declared unconditional in all respects and sufficient acceptances are received in respect of such Offer, EVO intends to: (i) make an application to the UK Listing Authority to cancel listing of the office2office Shares on the Official List and to the London Stock Exchange for cancelling of trading of office2office Shares on its main market for listed securities; and (ii) exercise its rights (to the extent such rights are available) to apply the provisions of Chapter 3 of Part 28 of the Companies Act to acquire compulsorily the remaining office2office Shares in respect of which such Offer has not been accepted.

The Scheme Document will include full details of the Scheme, together with the notice of the Court Meeting and the General Meeting.  The Scheme Document will also contain the expected timetable for the office2office Acquisition and will specify the necessary actions to be taken by office2office Shareholders.  The Scheme Document, together with the Forms of Proxy, will be posted to office2office Shareholders and, for information only, to persons with information rights and to holders of awards granted under the office2office Share Schemes as soon as practicable and, in any event, within 28 days of the date of this announcement.  It is expected that the Court Meeting (subject to the approval of the Court) and the General Meeting will be held on or about 2 October 2014.

14.       Offer-related arrangement

On 4 June 2014, office2office and Endless entered into a confidentiality and standstill agreement (subsequently varied on 11 July 2014) in a customary form in relation to the office2office Acquisition, pursuant to which, among other things, Endless undertook, subject to certain exceptions, to:

·        keep confidential information relating to office2office and not disclose it to third parties other than those specifically permitted within the agreement; and

·        not use, and procure that no other member of Endless' group uses confidential information directly or indirectly to solicit, any person employed by office2office or by any member of the office2office Group holding confidential information at any time during the course of discussions regarding the office2office Acquisition or any customer of office2office or of any other member of the office2office Group.

The standstill provision contained in the confidentiality and standstill agreement ceases to apply on the release of this announcement.  Except where otherwise specified, the remaining obligations in the confidentiality and standstill agreement terminate on the earlier of nine months from the date of the confidentiality and standstill agreement and the Effective Date.

In addition, on 14 July 2014, office2office, Endless, Vasanta and an adviser to EVO entered into an agreement to govern the disclosure and review of certain commercially sensitive office2office information as part of EVO's due diligence exercise.

15.       Suspension, cancellation and re-registration

It is intended that dealings in, and the registration of transfers of, office2office Shares will be suspended from the Official List and from the London Stock Exchange's main market for listed securities at 5.00 p.m. London time on the last Dealing Day prior to the Effective Date.

It is further intended that applications will be made to the London Stock Exchange for office2office Shares to cease to be admitted to trading on its main market for listed securities and to the UK Listing Authority for the cancellation of the listing of office2office Shares on the Official List, in each case to take effect as of or shortly after the Effective Date.

On the Effective Date, share certificates in respect of office2office Shares will cease to be valid and should be destroyed.  In addition, entitlements to office2office Shares held within the CREST system will be cancelled.

It is also intended that, as part of the Scheme, office2office will be re-registered as a private limited company pursuant to the relevant provisions of the Companies Act.

16.       Opening Position Disclosures and interests

EVO confirms that on the date of this announcement it intends to make an Opening Position Disclosure, setting out the details required to be disclosed by it under Rule 8.1(a) of the Code.

In the interests of maintaining secrecy prior to this announcement, it has not been practicable for EVO to have made enquiries with all of the parties deemed by the Panel to be acting in concert with EVO. Enquiries of those outstanding parties will be made as soon as practicable following the date of this announcement and EVO confirms that further disclosure(s) in accordance with Rule 8.1(a) and Note 2(a)(i) on Rule 8 of the Code will be made as soon as possible, if required.

17.       Documents on display

Copies of the following documents will be published by no later than 12 noon (London time) on the Business Day following the date of this announcement on office2office's website at www.office2office.co.uk:

(a)        the irrevocable undertakings referred to in paragraph 6 above and summarised in Appendix 2 of this announcement;

(b)        the agreements referred to in paragraph 14 above;

(c)        the documents relating to the financing of the office2office Acquisition; and

(d)        this announcement.

18.       General

The office2office Acquisition will be subject to the Conditions and certain further terms set out in Appendix 2 of this announcement and to the more detailed terms to be set out in the Scheme Document when published.

The office2office Acquisition and Scheme will be governed by English law and will be subject to the jurisdiction of the English courts.  The Scheme will be subject to the applicable requirements of the Code, the Panel, the London Stock Exchange and the UK Listing Authority.

Certain terms used in this announcement are defined in Appendix 4 of this announcement.

Enquiries

EVO

+44 (0) 113 210 4000

Mathew Deering

 

 

 

Deloitte Corporate Finance (Financial adviser to EVO and Endless)

+44 (0) 207 936 3000

Byron Griffin / David Smith / Adrian Hargrave

 

 

 

office2office plc

+44 (0) 1603 691102

Jim Cohen / Simon Moate / Hugh Cawley / Debbie Rodwell

 

 

Rothschild (Financial adviser to office2office)

+44 (0) 113 200 1900

Stephen Griffiths  / Matthew Jowett

 

 

 

WH Ireland (Broker to office2office)

+44 (0) 207 220 1666

Adrian Hadden / Nick Field

 

 

MHP Communications (PR adviser to office2office)

+44 (0) 203 128 8100

Reg Hoare / Katie Hunt / Jade Neal




 



 

Further information

This announcement is for information purposes only and is not intended to and does not constitute, or form part of, any offer or the solicitation of any offer to sell, or an invitation to subscribe for, to purchase, otherwise acquire, subscribe for, sell or otherwise dispose of any securities, or the solicitation of any vote or approval in any jurisdiction, pursuant to the office2office Acquisition or otherwise.

EVO's offer to office2office Shareholders will be made solely by means of the Scheme Document, which will contain the full terms and conditions of the office2office Acquisition, including details of how to vote in respect of the Scheme.  Any vote in respect of the Scheme or other response in relation to the office2office Acquisition should be made only on the basis of the information contained in the Scheme Document.  office2office Shareholders are advised to read the formal documentation in relation to the office2office Acquisition carefully once it has been despatched.

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.

Deloitte Corporate Finance is acting for EVO and Endless and no one else in connection with the office2office Acquisition and will not be responsible to anyone other than EVO and Endless for providing the protections afforded to clients of Deloitte Corporate Finance or for providing advice in relation to the office2office Acquisition, the contents of this announcement or any other matters referred to in this announcement. Deloitte Corporate Finance is a division of Deloitte LLP, which is authorised and regulated in the United Kingdom by the FCA in respect of regulated activities.

Rothschild, which is authorised by the Prudential Regulation Authority and regulated by the FCA and the Prudential Regulation Authority in the United Kingdom, is acting as the sole financial adviser to office2office and no-one else in relation to the subject matter of this announcement and will not be responsible to anyone other than office2office for providing the protections afforded to clients of Rothschild nor for providing advice in relation to the subject matter of this announcement.

 

Certain terms used in this announcement are defined in Appendix 4 of this announcement.

Overseas jurisdictions

The availability of the office2office Acquisition or the release, publication or distribution of this announcement to office2office Shareholders who are not resident in and citizens of the United Kingdom may be restricted by the laws of the relevant jurisdiction in which they are located or of which they are citizens.  Such persons should inform themselves of, and observe, all applicable legal and regulatory requirements of their jurisdictions.  Any failure to comply with the requirements of such jurisdictions may constitute a violation of the securities laws of such jurisdictions.  To the fullest extent permitted by applicable law, the companies and persons involved in the office2office Acquisition disclaim any responsibility or liability for the violation of such restrictions by any person.  This announcement has been prepared for the purposes of complying with English law, the Listing Rules, the rules of the London Stock Exchange and the Code and the information disclosed may not be the same as that which would have been disclosed if this announcement had been prepared in accordance with the laws of jurisdictions other than England and Wales.

The office2office Acquisition will not be made, directly or indirectly, in or into, any Restricted Jurisdiction.  Accordingly, copies of this announcement and formal documentation relating to the office2office Acquisition are not being, and must not be, directly or indirectly, mailed or otherwise forwarded, transmitted, distributed, sent or accessed in or into or from any Restricted Jurisdiction.  Persons receiving this announcement (including, without limitation, custodians, nominees and trustees) should observe these restrictions and must not mail or otherwise forward, transmit, distribute or send it in or into or from any Restricted Jurisdiction.

 

 

Notice to US Holders

US Holders should note that the office2office Acquisition relates to the securities of an English company, is subject to UK disclosure requirements (which are different from those of the US) and is proposed to be implemented under a scheme of arrangement provided for under English company law.  A transaction effected by means of a scheme of arrangement is not subject to the tender offer rules under the US Exchange Act and the proxy solicitation rules under the US Exchange Act will not apply to the office2office Acquisition.  Accordingly, the Scheme will be subject to UK disclosure requirements and practices, which are different from the disclosure requirements of the US tender offer and proxy solicitation rules.  The financial information included in this announcement has been, or will have been, prepared in accordance with IFRS (with the exception of financial information provided on Vasanta which has been prepared in accordance with UK GAAP) and thus may not be comparable to financial information of US companies or companies whose financial statements are prepared in accordance with generally accepted accounting principles in the US.  However, if EVO were to exercise its right to implement the acquisition of the office2office Shares by way of a takeover offer, such offer will be made in compliance with applicable US laws and regulations.

 

The receipt of cash pursuant to the office2office Acquisition by a US Holder as consideration for the cancellation of its Scheme Shares pursuant to the Scheme may be a taxable transaction for US federal income tax purposes and under applicable US state and local, as well as foreign and other, tax laws.  Each office2office Shareholder is urged to consult his independent professional adviser immediately regarding the tax consequences of the office2office Acquisition applicable to him.

 

It may be difficult for US Holders to enforce their rights and claims arising out of the US federal securities laws, since EVO and office2office are located in countries other than the US, and some or all of their officers and directors may be residents of countries other than the US.  US Holders may not be able to sue a non-US company or its officers or directors in a non-US court for violations of US securities laws.  Further, it may be difficult to compel a non-US company and its affiliates to subject themselves to a US court's judgement.

 

If EVO were to exercise its right to implement the acquisition of the office2office Shares by way of a takeover offer, EVO or its nominees, or its brokers (acting as agents), could make certain purchases of, or arrangements to purchase, office2office Shares outside of the US, other than pursuant to the takeover offer, in accordance with normal UK practice and pursuant to Rule 14e-5(b) of the US Exchange Act.  These purchases could occur either in the open market at prevailing prices or in private transactions at negotiated prices.  Any information about such purchases would be disclosed as required in the UK, would be reported via a RIS and would be available on the London Stock Exchange website at http://www.londonstockexchange.com/prices-and-news/pricesnews/home.htm.

 

Forward looking statements

This announcement may contain statements which are, or may be deemed to be, "forward-looking statements".  Often, but not always, forward-looking statements can be identified by the use of forward-looking words such as "will", "may", "should", "continue", "believe", "expect", "intend", "anticipate", "forecast", "plan" and "project" or similar expressions.  Such statements reflect the relevant company's or person's current views with respect to future events and are subject to risks, assumptions and uncertainties that could cause the actual results to differ materially from those expressed or implied by such forward-looking statements.

 

Many of these risks, assumptions and uncertainties relate to factors that are beyond the companies' or relevant persons' abilities to control or estimate precisely, including the following: future market conditions, changes in general economic and business conditions, regulatory changes, the behaviour of other market participants, litigation, weak, volatile or illiquid capital and/or credit markets, interest rate and currency value fluctuations, the degree of competition in the geographic and business areas in which EVO and office2office operate and changes in laws or in supervisory expectations or requirements.  Other unknown or unpredictable factors could also cause actual results to differ materially from those in the forward-looking statements.  Neither EVO nor office2office can give any assurance that the forward-looking statements will prove to have been correct.  You should not, therefore, place undue reliance on these forward-looking statements, which speak only as of the date of this announcement.  Neither EVO nor office2office undertakes any obligation to update or revise publicly any of the forward-looking statements set out in this announcement, whether as a result of new information, future events or otherwise, except to the extent legally required.

No profit forecasts or estimates

No statement in this announcement is intended as a profit forecast or estimate for any period and no statement in this announcement should be interpreted to mean that earnings or earnings per share for office2office, as appropriate, for the current or future financial years would necessarily match or exceed the historical published earnings or earnings per share for office2office.

Disclosure requirements of the Code

Under Rule 8.3(a) of the Code, any person who is interested in 1% or more of any class of relevant securities of an offeree company or of any securities exchange offeror (being any offeror other than an offeror in respect of which it has been announced that its offer is, or is likely to be, solely in cash) must make an Opening Position Disclosure following the commencement of the offer period and, if later, following the announcement in which any securities exchange offeror is first identified. An Opening Position Disclosure must contain details of the person's interests and short positions in, and rights to subscribe for, any relevant securities of each of (i) the offeree company and (ii) any securities exchange offeror(s). An Opening Position Disclosure by a person to whom Rule 8.3(a) applies must be made by no later than 3.30 pm (London time) on the 10th Business Day following the commencement of the offer period and, if appropriate, by no later than 3.30 pm (London time) on the 10th Business Day following the announcement in which any securities exchange offeror is first identified. Relevant persons who deal in the relevant securities of the offeree company or of a securities exchange offeror prior to the deadline for making an Opening Position Disclosure must instead make a Dealing Disclosure.

Under Rule 8.3(b) of the Code, any person who is, or becomes, interested in 1% or more of any class of relevant securities of the offeree company or of any securities exchange offeror must make a Dealing Disclosure if the person deals in any relevant securities of the offeree company or of any securities exchange offeror. A Dealing Disclosure must contain details of the dealing concerned and of the person's interests and short positions in, and rights to subscribe for, any relevant securities of each of (i) the offeree company and (ii) any securities exchange offeror, save to the extent that these details have previously been disclosed under Rule 8. A Dealing Disclosure by a person to whom Rule 8.3(b) applies must be made by no later than 3.30 pm (London time) on the Business Day following the date of the relevant dealing.

If two or more persons act together pursuant to an agreement or understanding, whether formal or informal, to acquire or control an interest in relevant securities of an offeree company or a securities exchange offeror, they will be deemed to be a single person for the purpose of Rule 8.3.

Opening Position Disclosures must also be made by the offeree company and by any offeror and Dealing Disclosures must also be made by the offeree company, by any offeror and by any persons acting in concert with any of them (see Rules 8.1, 8.2 and 8.4).

Details of the offeree and offeror companies in respect of whose relevant securities Opening Position Disclosures and Dealing Disclosures must be made can be found in the Disclosure Table on the Takeover Panel's website at www.thetakeoverpanel.org.uk, including details of the number of relevant securities in issue, when the offer period commenced and when any offeror was first identified. You should contact the Panel's Market Surveillance Unit on +44 (0)20 7638 0129 if you are in any doubt as to whether you are required to make an Opening Position Disclosure or a Dealing Disclosure.

Rule 2.10 disclosure

In accordance with Rule 2.10, office2office confirms that, as at the close of business on 20 August 2014, it had 36,308,984 ordinary shares of 1 pence each in issue and admitted to trading on the main market of the London Stock Exchange.  The International Securities Identification Number for office2office Shares is GB00B01GL703.

Information relating to office2office Shareholders

Please be aware that addresses, electronic addresses and certain other information provided by office2office Shareholders, persons with information rights and other relevant persons for the receipt of communications from office2office may be provided to EVO during the Offer Period as required under Section 4 of Appendix 4 to the Code.

Publication on website and hard copies

A copy of this announcement will be made available on office2office's website at www.office2office.co.uk by no later than 12 noon (London time) on the Business Day following the date of this announcement.  For the avoidance of doubt, the contents of that website are not incorporated into, and do not form part of, this announcement. 

 

A hard copy of this announcement will be sent to all office2office Shareholders. office2office Shareholders and persons with information rights may also request a hard copy of this announcement (and any information incorporated by reference in this announcement) by writing to Capita Asset Services, 34 Beckenham Road, Beckenham, Kent, BR3 4TU or by calling 0871 664 0300 (or, if calling from outside the UK, on +44 (0)20 8639 3399). Calls within the UK cost 10 pence per minute plus network extras, lines are open 9:00a.m. - 5:30p.m., Monday to Friday (except English bank holidays). Calls from outside the UK will be charged at the applicable international rate. Should office2office determine not to send copies of certain documents in hard copy form, office2office Shareholders may also request that all future documents, announcements and information sent to them in relation to the office2office Acquisition be in hard copy form.



APPENDIX 1

CONDITIONS AND CERTAIN FURTHER TERMS OF THE SCHEME

 

Part A: Conditions of the office2office Acquisition

The office2office Acquisition will be conditional upon the Scheme becoming unconditional and becoming effective by no later than the Long Stop Date, or such later date (if any) as EVO and office2office may (with the consent of the Panel) agree and, if required, the Court may allow.

1        The Scheme will be conditional upon:

1.3.1       the delivery of office copies of the Court Orders (with the Statement of Capital attached thereto) to the Registrar of Companies; and

1.3.2       in relation to the Capital Reduction, if required by the Court, the Reduction Court Order being registered by the Registrar of Companies.

2        Subject to Part B of this Appendix 1 and the requirements of the Panel in accordance with the City Code, EVO and office2office have agreed that the office2office Acquisition will also be conditional upon the following conditions, and accordingly the necessary actions to make the Scheme effective will not be taken unless the following conditions (as amended if appropriate) have been satisfied (and continue to be satisfied pending the commencement of the Scheme Court Hearing) or, where relevant, waived prior to the Scheme being sanctioned by the Court:

2.1.1       the CMA indicating in terms reasonably satisfactory to EVO that it has decided not to refer the office2office Acquisition (or any part of it or matter arising from it or related to it) to the chair of the CMA for the constitution of a group under Schedule 4 to the Enterprise and Regulatory Reform Act 2013 (Phase 2 CMA Reference); or

2.1.2       the period within which the CMA is required by section 34ZA of the Enterprise Act 2002 to decide whether to refer the office2office Acquisition for a Phase 2 CMA Reference having expired without such a decision having been made;

2.4.1       any such agreement, arrangement, lease, licence, permit or other instrument or the rights, liabilities, obligations, interests or business of any member of the office2office Group under any such agreement, arrangement, lease, licence, permit or other instrument or the interests or business of any such member in or with, any person, firm, company or body (or any arrangement or arrangements relating to any such interests or business) being or becoming capable of being terminated, modified or affected or any obligation or liability arising or any action being taken or arising thereunder;

2.4.2       any asset owned or used by any member of the office2office Group, or any interest in such asset, being or falling to be disposed of or charged or ceasing to be available to any member of the office2office Group or any right arising under which any such asset or interest could be required to be disposed of or charged or cease to be available to any member of the office2office Group;

2.4.3       the creation or enforcement of any mortgage, charge or other security interest over the whole or any part of the business, property, assets or interest of any member of the office2office Group or any such mortgage, charge or other security interest (whenever created, arising or having arisen) becoming enforceable;

2.4.4       the business, assets, liabilities, value or operational performance of any member of the office2office Group or its financial or trading position or profits being prejudiced or adversely affected;

2.4.5       any member of the office2office Group ceasing to be able to carry on business under any name which it at present uses;

2.4.6       the creation or acceleration of any liability (actual or contingent) by any member of the office2office Group other than to trade creditors in the ordinary course of business;

2.4.7       any liability of any member of the office2office Group to make any severance, termination, bonus or other payment to any of its directors or other officers;

2.4.8       any requirement on any member of the office2office Group to acquire, subscribe, pay up or repay any shares or other securities; or

2.4.9       any monies borrowed by or any other indebtedness (actual or contingent) of, or any grant available to any member of the office2office Group, being or becoming repayable or capable of being declared repayable, immediately or prior to its or their stated maturity date or repayment date, or the ability of such member of the office2office Group to borrow monies or incur any indebtedness becoming or being withdrawn or inhibited,

and no event having occurred which, under any provision of any agreement, arrangement, lease, licence, permit or other instrument to which any member of the office2office Group is a party or by or to which any such member or any of its assets may be bound, entitled or subject, could reasonably be expected to result in any of the events or circumstances as are referred to in paragraphs 2.4.1 to 2.4.9 (inclusive) of this condition;

2.5.1       require, prevent, limit or delay the divestiture, or alter the terms for any proposed divestiture, by any member of the office2office Group or by any member of the Wider EVO Group of all or any part of their respective businesses, assets, undertakings or properties or impose any limitation on the ability of any of them to conduct all or any part of their respective businesses or to own or control all or any part of their respective assets or properties;

2.5.2       require, prevent, limit or delay the divestiture by any member of the Wider EVO Group of any shares or other securities in any member of the office2office Group;

2.5.3       impose any limitation on, or result in a delay in, the ability of any member of the Wider EVO Group to acquire or to hold or to exercise effectively, directly or indirectly, all or any rights of ownership of shares or loans or securities convertible into shares or any other securities (or the equivalent) in any member of the office2office Group or on the ability of any member of the office2office Group to hold or exercise effectively, directly or indirectly, all or any rights of ownership in respect of shares or other securities in any member of the office2office Group or to exercise management control over any such member of the office2office Group;

2.5.4       other than pursuant to the implementation of the office2office Acquisition, require any member of the Wider EVO Group or the office2office Group to acquire, offer to acquire, redeem or repay any shares or other securities (or interest in) and/or any indebtedness of any member of the office2office Group or the Wider EVO Group owned by or owed to any third party or any asset owned by any third party;

2.5.5       make the office2office Acquisition or its implementation or the acquisition or proposed acquisition of any shares or other securities in, or control or management of, any member of the office2office Group void, illegal and/or unenforceable under the laws of any relevant jurisdiction, or otherwise, directly or indirectly, prevent, restrain, restrict, prohibit, or delay the same, or otherwise impose any additional conditions or financial or other obligations with respect thereto, or otherwise challenge, hinder or interfere therewith or require amendment to the office2office Acquisition or its implementation;

2.5.6       otherwise affect any or all of the business, assets, liabilities, value, operational performance, financial or trading positions or profits of any member of the office2office Group or the Wider EVO Group;

2.5.7       impose any limitation on the ability of any member of the Wider EVO Group or the office2office Group to conduct or 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 EVO Group or the office2office Group;

2.5.8       require any member of the office2office Group to relinquish, terminate or amend in any way any contract to which any member of the office2office Group is a party; or

2.5.9       result in any member of the office2office Group ceasing to be able to carry on business under any name under which it presently does so,

to an extent in each case which is material in the context of the office2office Acquisition, office2office Group or the Wider EVO Group in each case taken as a whole and all applicable waiting and other time periods (including extensions thereof) during which any Third Party could take, institute, implement or threaten in writing any action, proceedings, suit, investigation, enquiry or reference or any other step under the laws of any relevant jurisdiction in respect of the office2office Acquisition or the proposed acquisition of any office2office Shares or otherwise intervene having expired, lapsed or been terminated;

2.8.1       save as between office2office and wholly-owned subsidiaries of office2office (the office2office Group) issued, agreed to issue, authorised or announced its intention or a proposal to authorise the issue of additional shares of any class, or securities or of securities convertible into or exchangeable for, or rights, warrants or options to subscribe for or acquire, any such shares or convertible securities or redeemed, purchased or repaid or announced any proposal to redeem, purchase or repay any of its own shares or other securities or reduced or made any other change to any part of its share capital;

2.8.2       other than to another member of the office2office Group, recommended, declared, paid or made or announced a proposal to recommend, declare, pay or make any bonus, dividend or other distribution whether payable in cash or otherwise;

2.8.3       save for transactions between members of the office2office Group, merged with (however effected) or demerged from or acquired any body corporate, partnership or business or acquired or disposed of or transferred, mortgaged or charged or created any security interest over any assets or any right, title or interest in any asset (including shares and trade investments) or authorised or announced any intention or proposal to do so, in each case, other than in the ordinary and proper course of its trade;

2.8.4       save for transactions between members of the office2office Group, made or authorised or announced an intention or a proposal to any change in its loan capital;

2.8.5       issued, authorised or announced an intention or a proposal to authorise or propose the issue of or made any change in or to the terms of any debentures or (save between members of the office2office Group) incurred or increased any indebtedness or become subject to any liability (actual or contingent);

2.8.6       other than pursuant to the office2office Acquisition (and except for transactions in the ordinary course of its business or between office2office and members of the office2office Group), entered into, implemented, effected, or authorised, or announced its intention or a proposal to enter into or implement or effect, any reconstruction, amalgamation, joint venture, asset or profit sharing scheme, partnership, commitment, composition, assignment or other transaction or arrangement otherwise than the office2office Acquisition;

2.8.7       entered into, varied, authorised or announced its intention or a proposal to enter into, or vary any contract, transaction, arrangement or commitment (whether in respect of capital expenditure or otherwise) which is of a long term, onerous or unusual nature or magnitude or which could reasonably be expected to involve an obligation of a nature or magnitude or which is, in any such case, material in the context of the office2office Group as a whole;

2.8.8       taken or announced an intention or proposal to take any steps, any corporate action or had any legal proceedings instituted or threatened in writing against it or petition presented or order made in relation to the suspension of payments, a moratorium of any indebtedness, its winding-up (voluntary or otherwise), dissolution or reorganisation or for the appointment of a receiver, administrative receiver, administrator, manager, trustee or similar officer of all or any of its assets or revenues or any analogous proceedings in any jurisdiction or had any such person appointed to an extent in each case which is material in the context of the office2office Group taken as a whole;

2.8.9       been unable, or admitted that it is unable, to pay its debts as they fall due or commenced negotiations with one or more of its creditors with a view to rescheduling or restructuring any of its indebtedness (other than in respect of any ongoing discussions between any member of the office2office Group and any of its banks regarding the refinancing of existing funding due for repayment on 30 June 2015), or having 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;

2.8.10     entered into any licence or other disposal of intellectual property rights of any member of the office2office Group which are material in the context of the office2office Group and outside the ordinary and proper cause of its trade;

2.8.11     waived or compromised or settled any claim otherwise than in the ordinary and proper course of its trade;

2.8.12     entered into any contract, commitment, arrangement or agreement otherwise than in the ordinary and proper course of its trade or passed any resolution or made any offer (which remains open for acceptance) with respect to or announced any intention or proposal to effect any of the transactions, matters or events referred to in this condition;

2.8.13     made any alteration to its memorandum or articles of association (in each case, other than an alteration in connection with the Scheme and agreed to by EVO);

2.8.14     announced a proposal to or agreed to provide or modified the terms of any share option scheme, incentive scheme or other benefit relating to the employment or termination of employment of any person employed by the office2office Group or entered into or changed, or announced its intention or a proposal to enter into or change the terms of any contract, commitment, arrangement or contract with any director or senior executive of the office2office Group;

2.8.15     terminated or varied the terms of any agreement or arrangement between any member of the office2office Group and any other person in a manner which would or might be expected to have a material adverse effect on the financial position of the office2office Group taken as a whole; or

2.8.16     taken (or agreed to take or announced any intention or proposal to take) any action which requires, or would require, the consent of the Panel or the approval of office2office Shareholders in general meeting in accordance with, or as contemplated by, Rule 21.1 of the City Code;

2.9.1       there having been no adverse change or deterioration in the business, assets, liabilities, value, financial or trading position or profits of any member of the office2office Group to an extent which is material to the office2office Group (taken as a whole);

2.9.2       no litigation, arbitration proceedings, prosecution or other legal proceedings having been threatened in writing, announced or instituted by or against (or remaining outstanding) by any member of the office2office Group or to which any member of the office2office Group is or may become a party (whether as a claimant, defendant or otherwise) and no enquiry, review, investigation or enforcement proceedings by, or complaint or reference to, any Third Party against or in respect of any member of the office2office Group having been instituted, announced, implemented or threatened by or against (or remaining outstanding) any member of the office2office Group in each case to an extent which is or might reasonably be expected to be material to the office2office Group (taken as a whole);

2.9.3       no contingent or other liability having arisen, increased or become apparent that might reasonably be likely adversely to affect the business, assets, value, liabilities, financial or trading position or profits, operational performance or prospects of any member of the office2office Group to an extent which is or might reasonably be expected to be material to the office2office Group (taken as a whole);

2.9.4       other than in the ordinary course of its business, no amendment or termination of any joint venture or partnership to which any member of the office2office Group is a party having been agreed or permitted; and

2.9.5       other than in the ordinary course of its business, no steps having been taken and no omissions having been made which are likely to result in the withdrawal, cancellation, termination or modification of any licence held by any member of the office2office Group which is necessary for the proper carrying on of its business to an extent which is material to the office2office Group (taken as a whole);

2.10.1     that any financial, business or other information concerning the office2office Group as contained in the information publicly announced or disclosed to any member of the Wider EVO Group or any of their advisers at any time by or on behalf of any member of the office2office Group or any of their advisers, is misleading or contains any misrepresentation of fact or omits to state a fact necessary to make that information not misleading and was not subsequently corrected before the date of this announcement by disclosure either publically (via a RIS) or in writing to EVO;

2.10.2     that any member of the office2office Group is subject to any liability (actual, contingent or otherwise) which is not disclosed in the published annual report and accounts of office2office for the year ended 31 December 2013; or

2.10.3     any information which affects the import of any information disclosed at any time by or on behalf of any member of the office2office Group,

in each case, to an extent or in a manner which is or might reasonably be expected to be material in the context of the office2office Group; and

2.11.1     since 31 December 2013, any circumstance has arisen or event has occurred in relation to any intellectual property owned or used by any member of the office2office Group which would have a material adverse effect on the office2office Group (taken as a whole) or is otherwise material in the context of the office2office Acquisition, including:

 

(a)     any member of the office2office Group losing its title to any intellectual property material to its business, or any intellectual property owned by the office2office Group and material to its business being revoked, cancelled or declared invalid;

 

(b)     any claim being asserted in writing by any person challenging the ownership of any member of the office2office Group to, or the validity or effectiveness of, any of its intellectual property; or

 

(c)     any agreement regarding the use of any intellectual property licensed to or by any member of the office2office Group being terminated or varied;

2.11.2     any past or present member of the office2office Group has failed to comply with any and/or all applicable legislation or regulation, of any jurisdiction with regard to the disposal, spillage, release, discharge, leak or emission of any waste or hazardous substance or any substance likely to impair the environment or harm human health or animal health or otherwise relating to environmental matters, or that there has otherwise been any such disposal, spillage, release, discharge, leak or emission (whether or not the same constituted a non-compliance by any person with any such legislation or regulations, and wherever the same may have taken place) any of which disposal, spillage, release, discharge, leak or emission would be likely to give rise to any liability (actual or contingent) on the part of any member of the office2office Group to an extent which is material in the context of the office2office Group as a whole;

2.11.3     there is, or is likely to be, for that or any other reason whatsoever, any liability (actual or contingent) of any past or present member of the office2office Group to make good, repair, reinstate or clean up any property or any controlled waters now or previously owned, occupied, operated or made use of or controlled by any such past or present member of the office2office Group, under any environmental legislation, regulation, notice, circular or order of any Third Party in any jurisdiction or indemnify any person in relation thereto to an extent which is material in the context of the office2office Group as a whole;

2.11.4     circumstances exist (whether as a result of the office2office Acquisition or otherwise):

 

(a)     which would be likely to lead to any Third Party instituting; or

 

(b)     whereby any member of the office2office Group or any present or past member of the office2office Group would be likely to be required to institute,

an environmental audit or take any other steps which would in any such case be reasonably likely to result in any liability (whether actual or contingent) to improve, modify existing or install new plant, machinery or equipment or carry out changes in the processes currently carried out or make good, remediate, repair, reinstate or clean up any land or other asset currently or previously owned, occupied or made use of by any past or present member of the office2office Group (or on its behalf) or by any person for which a member of the office2office Group is or has been responsible, or in which any such member may have or previously have had or be deemed to have had an interest to an extent which is material in the context of the office2office Group as a whole; and

2.11.5     there is, or is likely to be expected to be, or there has been, any claim brought against any member of the office2office Group by a person or class of persons in respect of any liability (actual or contingent) of any member of the office2office Group as a result of or relating to, any material, chemical, product or process of manufacture or materials now or previously held, used, sold, manufactured, carried out or under development or research by any past or present member of the office2office Group to an extent which is material in the context of the office2office Group as a whole.

These conditions are inserted for the benefit of EVO.  Each of these conditions shall be regarded as a separate condition and not be limited by reference to any other condition.

EVO reserves the right to waive, in whole or in part, all or any of conditions 2.1 to 2.11 (inclusive) of this Appendix 1.

For the purposes of these conditions, Disclosed shall mean any information which has been fairly disclosed (i) in the annual report and accounts of office2office for the year ended 31 December 2013; (ii) in writing by or on behalf of office2office to Endless before 21 August 2014; (iii) in the virtual data room prepared by or on behalf of office2office for the benefit of Endless in relation to the office2office Acquisition; or (iv) has otherwise been announced publicly and delivered by or on behalf of office2office through a RIS prior to the date of this announcement.



 

Part B: Certain further terms of the office2office Acquisition

 

1        office2office Shares which will be acquired under the office2office Acquisition will be acquired with full title guarantee, fully paid and free from all liens, equities, charges, encumbrances, options, rights of pre-emption and any other third party rights and interests of any nature and together with all rights attaching or accruing to them, including voting rights and the right to receive and retain in full all dividends and other distributions (if any) declared, made or paid on or after the date of this announcement.

2        If EVO is required by the Panel to make an offer for office2office Shares under the provisions of Rule 9 of the City Code, EVO may make such alterations to any of the above conditions as are necessary to comply with the provisions of that Rule.

3        Conditions 2.1 to 2.11 (inclusive) must be fulfilled, or be determined by EVO to be or remain satisfied or (if capable of waiver) be waived prior to the commencement of the Scheme Court Hearing, failing which the office2office Acquisition will lapse and the Scheme will not proceed.  EVO shall be under no obligation to waive (if capable of waiver), to determine to be or remain satisfied or treat as fulfilled any of the conditions 2.1 to 2.11 (inclusive) at any time prior to the Long Stop Date, notwithstanding that the other conditions (or any of them) may at an earlier date have been waived (if capable of waiver), satisfied or fulfilled and that there are, at such earlier date, no circumstances indicating that any such condition may not be capable of satisfaction or fulfilment.

4        The office2office Acquisition will lapse and the Scheme will not proceed if, prior to the date of the Court Meeting and the General Meeting, there is a Phase 2 CMA Reference or if Phase 2 European Commission proceedings are initiated or if, following a referral of the office2office Acquisition by the European Commission under Article 9(1) of the European Council Merger Regulation to a competent authority in the United Kingdom, there is a Phase 2 CMA Reference in respect of the office2office Acquisition, or any matter arising from the office2office Acquisition.

5        EVO reserves the right to elect (with the consent of the Panel) to implement the office2office Acquisition by way of a takeover offer (as defined in section 974 of the Companies Act) as it may determine in its absolute discretion. In such event, such offer will be implemented on the same terms (subject to the availability of an exemption (if required) from the registration requirements of the US Securities Act and such amendments (if any) as EVO deems necessary in connection with US securities laws), so far as applicable, as those which would apply to the Scheme, subject to appropriate amendments to reflect the change in method of effecting the office2office Acquisition, but with an acceptance condition which will be set by reference to shares carrying 90 per cent. (or such lower percentage as EVO may decide or the Panel may require) in value of the office2office Shares to which the Offer relates (the Takeover Acceptance Condition).

6        The availability of the Scheme to persons not resident in the United Kingdom may be affected by the laws of the relevant jurisdictions.  Persons who are not resident in the United Kingdom should inform themselves about and observe any applicable requirements.

7        The office2office Acquisition and Scheme will be governed by English law and will be subject to the jurisdiction of the English courts. The Scheme is subject to the applicable requirements of the Panel, the London Stock Exchange, the FSA and the Code, including:

7.1          under Rule 13.5 of the Code, EVO may not invoke a Condition so as to cause the office2office Acquisition not to proceed, to lapse or to be withdrawn unless the circumstances which give rise to the right to invoke the Condition are of material significance to EVO in the context of the office2office Acquisition.  The Conditions contained in paragraphs 1, 2.1 and 2.2 of Part A and, if applicable, the Takeover Offer Acceptance Condition set out in Part B are not subject to this provision of the Code; and

7.2          under Rule 13.6 of the Code, office2office may not invoke, or cause or permit EVO to invoke, any Condition unless the circumstances which give rise to the right to invoke the Condition are of material significance to the office2office Shareholders in the context of the office2office Acquisition.



 

APPENDIX 2

IRREVOCABLE UNDERTAKINGS

 

The following persons have given irrevocable undertakings to vote in favour of the Scheme at the Court Meeting and the Special Resolution at the General Meeting as follows:

 

office2office Directors

 

Name

Number of office2office Shares(1)

% of issued ordinary share capital of office2office as at 20 August 2014

Jim Cohen

107,346

0.3%

Simon Moate

236,832

0.7%

Hugh Cawley

50,000

0.1%

David Callear

650,991

1.8%

Chris Batterham

7,516

0.0%

 

 

 

Total

1,052,685

2.9%

(1) This number includes the number of office2office Shares (if any) held by family members/trusts/nominees of the relevant office2office Director to which the irrevocable also relates.

The undertakings referred to above shall lapse only if: (i) the Scheme Document (or, if EVO elects to implement the office2office Acquisition by way of an Offer, the offer document relating to the Offer) is not despatched to office2office Shareholders within 28 days of the date of this announcement (or such longer period as the Takeover Panel may agree); (ii) in the event that the office2office Acquisition is implemented by way of a Scheme, the Scheme or any resolution to be proposed at the Court Meeting or the General Meeting to approve or implement the Scheme is not approved by the requisite majority of office2office Shareholders (or at any adjournment of either such meeting); (iii) the Scheme or Offer lapses or is withdrawn and no revised or replacement Scheme or Offer has been announced in accordance with Rule 2.7 of the Code in its place at the same time; (iv) EVO announces that it does not intend to proceed with the Scheme or make the Offer (as applicable) and no revised or replacement Scheme or Offer is announced in accordance with Rule 2.7 of the Code in its place at the same time; (v) EVO announces publicly that it is implementing the office2office Acquisition by way of an Offer and such Offer does not become wholly unconditional on or before the date being six months following the publication of the offer document in respect of such Offer; or (vi) where none of the events listed at (i) to (v) have occurred first, the date falling 12 months from the date the irrevocable undertaking was given.

For the avoidance of doubt, but without prejudice to any of the above, the undertakings referred to above shall not lapse if EVO, with the consent of the Panel, announces publicly that it is implementing the office2office Acquisition by way of an Offer, having previously proceeded with the implementation of the office2office Acquisition by way of a Scheme (and vice versa).

 

Other office2office Shareholders

 

Name

Number of office2office Shares(1)

% of issued ordinary share capital of office2office as at 20 August 2014

 

 

 

Aberforth Partners LLP

6,034,612

16.6%

AXA Investment Managers UK Limited

4,358,315

12.0%

Nicholas Gerber

2,845,000

7.8%

Downing LLP

1,940,000

5.3%

 

 

 

Total

15,177,927

41.8%

(1) This number includes the number of office2office Shares controlled by the relevant office2office Shareholder to which the irrevocable also relates.

The undertakings given by Aberforth Partners LLP and Nicholas Gerber referred to above shall lapse only if: (i) the Scheme Document has not been posted within 28 days after the release of this announcement; or (ii) an announcement is made in accordance with Rule 2.7 of the Code of a competing offer (whether to be made by way of an offer or a scheme of arrangement or otherwise) in respect of the office2office Shares which represents, in the opinion of the relevant shareholder, a value at any time of not less than 60 pence per office2office Share.  In addition, such undertaking shall also lapse in respect of any office2office Shares that are sold or otherwise transferred (A) to any person at a price of not less than £0.60 and (B) to EVO (or anyone acting on its behalf) at a price less than £0.60.

The undertakings given by AXA Investment Managers UK Limited and Downing LLP referred to above shall lapse only if: (i) the Scheme Document (or, if EVO elects to implement the office2office Acquisition by way of an Offer, the offer document relating to the Offer) is not despatched to office2office Shareholders within 28 days of the date of this announcement (or such longer period as the Takeover Panel may agree); (ii) in the event that the office2office Acquisition is implemented by way of a Scheme, the Scheme or any resolution to be proposed at the Court Meeting or the General Meeting to approve or implement the Scheme is not approved by the requisite majority of office2office Shareholders (or at any adjournment of either such meeting); (iii) the Scheme or Offer lapses or is withdrawn and no revised or replacement Scheme or Offer has been announced in accordance with Rule 2.7 of the Code in its place at the same time; (iv) EVO announces that it does not intend to proceed with the Scheme or make the Offer (as applicable) and no revised or replacement Scheme or Offer is announced in accordance with Rule 2.7 of the Code in its place at the same time; (v) EVO announces publicly that it is implementing the office2office Acquisition by way of an Offer and such Offer does not become wholly unconditional on or before the date being three months following the publication of the offer document in respect of such Offer; (vi) where none of the events listed at (i) to (v) have occurred first, the date falling six months from the date the irrevocable undertaking was given; or (vii) any third party shall in accordance with the Code announce a firm intention to make a general offer not expressed to be subject to any pre-condition (whether made by way of an offer or a scheme of arrangement) for the entire issued and to be issued ordinary share capital of the Company which offer provides for an amount or value of consideration of not less than £0.60 per share (and, in the case of the undertaking given by Downing LLP, such competing offer is matched or bettered by EVO within 10 Business Days).

 



 

APPENDIX 3

SOURCES AND BASES

1.         Unless otherwise stated, (i) financial information relating to the office2office Group has been extracted or derived (without any adjustment) from the audited annual report and accounts for office2office for the year ended 31 December 2013 and (ii) financial information relating to the Vasanta Group has been extracted or derived (without any adjustment) from the annual report and accounts for Vasanta for the year ended 31 December 2013.

2.         The value of the office2office Acquisition is calculated by reference to the price of 51 pence for each office2office Share (being the price under the Scheme) and on the basis of the fully diluted number of office2office Shares as set out in paragraph 4 below.

3.         As at the close of business on 20 August 2014, being the last Dealing Day before the date of this announcement, office2office had in issue 36,308,984 office2office Shares. The International Securities Identification Number for office2office Shares is GB00B01GL703.

4.         The fully diluted share capital of office2office (being 37,377,505 office2office Shares) is calculated on the basis of the number of issued office2office Shares referred to in paragraph 3 above and assuming that options are validly exercised (to the extent vested on Court sanction) giving rise to the issue of up to a further 1,206,676 office2office Shares under the office2office Shares Schemes, adjusted for 138,155 office2office Shares currently held by the office2office EBT which will be used to satisfy the exercise of options (to the extent possible) under the office2office Share Schemes.

5.         Unless otherwise stated, all prices and closing prices for office2office Shares are closing middle market quotations derived from the London Stock Exchange's Daily Official List.

6.         All share prices expressed in pence have been rounded to the two decimal places and all percentages have been rounded to one decimal place. Unless otherwise stated, all prices and closing prices for office2office Shares are closing middle market quotations derived from the London Stock Exchange's Daily Official List.

 



 

APPENDIX 4

DEFINITIONS

 

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

 

£, pence or p

the lawful currency of the UK;

 

BMC

Banner Managed Communication, a business activity of office2office;

 

Business Day

a day (other than Saturdays, Sundays and public holidays in the UK) on which banks are open for general commercial business in London;

 

Capital Reduction

the proposed reduction of office2office's share capital involving the cancellation and extinguishing of the Scheme Shares;

 

Closing Price

in respect of an office2office Share on any particular day, the closing middle market quotation thereof as derived from the Daily Official List on that day;

 

 

CMA

the UK Competition and Markets Authority;

 

Code

the City Code on Takeovers and Mergers;

 

Companies Act

the Companies Act 2006;

 

Conditions

the conditions to the implementation of the office2office Acquisition (including the Scheme) as set out in Appendix 1 to this announcement and which will be set out in the Scheme Document;

 

Court

the High Court of Justice of England and Wales;

 

Court Meeting

the meeting(s) of the Scheme Shareholders to be convened by order of the Court pursuant to section 896 of the Companies Act, notice of which will be set out in the Scheme Document, for the purpose of approving the Scheme, including any adjournment of such meeting(s);

 

Court Orders

the Scheme Court Order and the Reduction Court Order;

 

CREST

the relevant system (as defined in the CREST Regulations) in respect of which Euroclear is the Operator (as defined in the CREST Regulations) in accordance with which securities may be held and transferred in uncertificated form;

 

CREST Regulations

the Uncertificated Securities Regulations 2001 (SI 2001/3755);

 

Dealing Day

a day on which dealing in domestic securities may take place on, and with the authority of, the London Stock Exchange;

 

Dealing Disclosure

an announcement pursuant to Rule 8 of the Code containing details of dealings in interests in relevant securities of a party to an offer;

 

Deloitte Corporate Finance

Deloitte Corporate Finance, a division of Deloitte LLP whose registered office is 2 New Street Square, London EC4A 3BZ, financial adviser to EVO and Endless in respect of the office2office Acquisition;

 

Effective Date

the date upon which the Scheme becomes effective in accordance with its terms;

 

Endless

Endless LLP, a limited liability partnership with registered number OC316569 incorporated under the laws of England and Wales on 7 December 2005;

 

Endless II Funds

together Endless Fund II A LP and Endless Fund II B LP, each of which is managed by Endless;

 

Endless III Funds

together Endless Fund III A LP, Endless Fund III B LP and Endless Fund III C LP, each of which is managed by Endless;

 

Enlarged EVO Group

EVO and its subsidiaries from time to time following completion of the office2office Acquisition and the Vasanta Acquisition;

 

EVO

EVO Business Supplies Limited, a private limited company incorporated in England and Wales with registered number 9060494;

 

EVO Directors

the directors of EVO as at the date of this announcement, being Garry Wilson, Darren Forshaw, Peter Yendell and Mathew Deering;

 

EVO Group

EVO, its subsidiaries and subsidiary undertakings;

 

Excluded Shares

(i) any office2office Shares beneficially owned by EVO or any other member of the EVO Group; and (ii) any other office2office Shares which EVO and office2office agree will not be subject to the Scheme;

 

FCA

the UK Financial Conduct Authority;

 

Forms of Proxy

the forms of proxy in connection with each of the Court Meeting and the General Meeting;

 

FSMA

the Financial Services and Markets Act 2000;

 

General Meeting

the general meeting of office2office to be convened in connection with the Scheme and the Capital Reduction, notice of which will be set out in the Scheme Document, including any adjournment of that meeting;

 

ICA

the Irish Competition Authority;

 

IFRS

International Financial Reporting Standards, as adopted in the European Union;

 

Listing Rules

the rules and regulations made by the FCA in its capacity as the UK Listing Authority under the FSMA and contained in the UK Listing Authority's publication of the same name;

 

London Stock Exchange

London Stock Exchange plc;

 

Long Stop Date

14 November 2014;

 

New office2office Shares

new ordinary shares of £0.01 each in the capital of office2office;

 

Offer

if (subject to the consent of the Panel) EVO elects to effect the office2office Acquisition by way of a takeover offer, the offer to be made by or on behalf of EVO to acquire the entire issued and to be issued ordinary share capital of office2office on the terms and subject to the conditions to be set out in the related offer document;

 

Offer Period

the offer period (as defined in the Code) relating to office2office, which commenced on 21 August 2014;

 

office2office

office2office plc, a public limited company incorporated in England and Wales with registered number 4083206;

 

office2office Acquisition

the proposed acquisition of the entire issued and to be issued share capital of office2office by EVO (other than office2office Shares already held by EVO, if any) to be implemented by way of the Scheme or (should EVO so elect, subject to the consent of the Panel) by way of the Offer;

 

office2office Board

the board of directors of office2office;

 

office2office Directors

the directors of office2office as at the date of this announcement, being Jim Cohen, Simon Moate, Hugh Cawley, David Callear and Chris Batterham;

 

office2office EBT

the office2office employee benefit trust, as established by a deed dated 23 June 2004 between office2office and Abacus Corporate Trustee Limited, the predecessor of the current trustee, RBC cees Trustee Limited;

 

office2office Group

office2office, its subsidiaries and subsidiary undertakings;

 

office2office Shareholders

the registered holders of office2office Shares from time to time;

 

office2office Shares

ordinary shares of £0.01 each in the capital of office2office;

 

office2office Share Schemes

the SAYE and the PSP;

 

Official List

the official list of the UK Listing Authority;

 

Opening Position Disclosure or OPD

has the same meaning as in Rule 8 of the Code;

 

Panel

the Panel on Takeovers and Mergers;

 

Phase 2 CMA Reference

a reference pursuant to Section 33 of the Enterprise Act 2002 of the Merger to the chair of the CMA for the constitution of a group under Schedule 4 to the Enterprise and Regulatory Reform Act 2013;

PSP

the office2office Performance Share Plan adopted by office2office on 22 November 2005 (as amended on 25 November 2010, 7 July 2011 and 12 August 2014);

 

Re-registration

the proposed re-registration of office2office as a private limited company under section 651 of the Companies Act and as provided for by the Scheme;

 

Reduction Court Hearing

the hearing of the Court of the application to confirm the Capital Reduction expected to be at least one Business Day after the date of the Scheme Court Hearing;

 

Reduction Court Order

the order of the Court to be granted at the Reduction Court Hearing;

 

Restricted Jurisdictions

any jurisdiction where the extension or availability of the Scheme or Offer would breach any applicable law;

 

RIS

any information service authorised from time to time by the FCA for the purpose of disseminating regulatory announcements;

 

Rothschild

N M Rothschild & Sons Limited, trading as Rothschild, financial adviser to office2office;

 

SAYE

the office2office Sharesave Scheme, as approved by office2office on 23 June 2004 and amended on 30 September 2004 and 29 September 2011;

 

Scheme

the scheme of arrangement proposed to be made under Part 26 of the Companies Act between office2office and the Scheme Shareholders, with or subject to any modification, addition or condition approved or imposed by the Court and agreed to by office2office and EVO;

 

Scheme Court Hearing

the hearing by the Court of the application to sanction the Scheme and confirm the Capital Reduction;

 

Scheme Court Order

the order of the Court to be granted at the Scheme Court Hearing, sanctioning the Scheme under Part 26 of the Companies Act;

 

Scheme Document

the document to be sent to (among others) office2office Shareholders containing and setting out, among other things, the full terms and conditions of the Scheme and containing the notices convening the Court Meeting and General Meeting;

 

Scheme Shareholders

holders of Scheme Shares;

 

Scheme Shares

office2office Shares:

(a)       in issue as at the date of this announcement;

(b)       (if any) issued after the date of this announcement and prior to the Scheme Voting Record Time; and

(c)       (if any) issued on or after the Scheme Voting Record Time and at or prior to the Scheme Record Time either on terms that the original or any subsequent holders thereof shall be bound by the Scheme or in respect of which the holders thereof shall have agreed in writing to be bound by the Scheme,

but in each case other than the Excluded Shares;

 

Scheme Record Time

6.00 p.m. on the Business Day immediately prior to the Reduction Court Hearing;

 

Scheme Voting Record Time

in respect of the Court Meeting, 6.00 p.m. (London time) on the day which is two Business Days before the date of such meeting or adjournment thereof (as the case may be);

 

Special Resolution

the special resolution to be proposed at the General Meeting to approve: (i) the authorisation of the office2office Directors to take all actions necessary or appropriate for carrying the Scheme into full effect; (ii) the Capital Reduction; (iii) the allotment and issue of New office2office Shares to EVO and/or its nominees; and (iv) the alteration of office2office's articles of association;

 

uncertificated form or in uncertificated form

a share or other security recorded on the relevant register as being held in uncertificated form in CREST, and title to which, by virtue of the CREST Regulations, may be transferred by means of CREST;

 

United Kingdom or UK

the United Kingdom of Great Britain and Northern Ireland;

 

UK GAAP

generally accepted accounting practice in the UK;

 

UK Listing Authority

the FCA acting in its capacity as the competent authority for listing under FSMA;

 

US

the United States of America, its territories and possessions, any state of the United States and the District of Columbia;

 

US Exchange Act

the Securities Exchange Act of 1934;

 

US Holders

holders of office2office Shares ordinarily resident in the US or with a registered address in the US, and any custodian, nominee or trustee holding office2office Shares for persons in the US or with a registered address in the US;

 

Vasanta

Vasanta Group Holdings Limited, incorporated in England and Wales with registered number 06949235 and whose registered office is at K House, Sheffield Business Park, Europa Link, Sheffield S9 1XU;

 

Vasanta Acquisition

the proposed acquisition of the entire issued share capital of Vasanta by EVO; and

 

Wider EVO Group

the EVO Group, Vasanta and Vasanta's subsidiaries and subsidiary undertakings.

 

For the purposes of this announcement, subsidiary, subsidiary undertaking, wholly-owned subsidiary, parent undertaking, undertaking and associate have the meanings given by sections 1152, 1159, 1161 and 1162 of the Companies Act.

References to an enactment include references to that enactment as amended, replaced, consolidated or re-enacted by or under any other enactment before or after the date of this announcement.

All references to time in this announcement are to London, UK time unless otherwise stated.


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