CXG Carlisle Gp

RNS Number:4769N
Carlisle Group Limited
07 February 2008

                             Carlisle Group Limited

 Possible Merger of The Corporate Services Group plc and Carlisle Group Limited

The following announcement has been released this morning by The Corporate
Services Group plc in relation to a possible merger with Carlisle Group Limited.
The full transcript of the announcement is displayed below:


 "Not for release, publication or distribution in or into the United States of
America, Australia, Canada or Japan or any other jurisdiction if to do so would
       constitute a violation of the relevant laws of such jurisdiction.


                       The Corporate Services Group plc
                 ("Corporate Services Group" or the "Company")

 Possible Merger of The Corporate Services Group plc and Carlisle Group Limited
                                  ("Carlisle")


The board of Corporate Services Group announces that it is in discussions
regarding a possible merger which, if implemented, would be effected by: the
creation of a new UK registered holding company ("Newco"), the subsequent
acquisition by Newco of Corporate Services Group and Carlisle and the admission
of Newco to AIM, a market of the London Stock Exchange plc (the "Possible
Merger"). The implementation of the Possible Merger is subject to satisfaction
(or waiver) of certain pre-conditions as set out below.

As part of the Possible Merger it is expected that the acquisition of Corporate
Services Group would be effected through a scheme of arrangement (the "Scheme")
which would need to be approved by Corporate Services Group's shareholders in
general meeting and sanctioned by the UK Court, and that the acquisition of
Carlisle would be effected by a merger of Newco and Carlisle under Belize law
(the "Belize Merger"). It is anticipated that if the Possible Merger is
implemented, the Scheme will be conditional on completion of the Belize Merger,
and both the Scheme and the Belize Merger will be conditional on admission of
the shares in Newco to AIM.

On the basis of the current terms under discussion, Corporate Services Group
shareholders would, upon completion of the Possible Merger, hold 47 per cent. of
Newco and Carlisle shareholders would hold 53 per cent. of Newco. In addition,
Carlisle intends to form a new subsidiary which will be capitalised as to �4
million and the shares of the new company will be distributed to Carlisle
shareholders in proportion to their respective shareholdings. It is intended
that the shares of the new company would then be listed on AIM.

The directors of Corporate Services Group believe that the Possible Merger would
have a number of advantages for Corporate Services Group, Carlisle and their
respective shareholders, employees and customers. These advantages include the
following:

*   the combination of Corporate Services Group and Carlisle would create a
diversified support services business with total combined revenues approaching
�1bn in 2007;

*   the Newco group would contain an increased number of strong operating brands
across a broad range of sectors;

*   the combination of Corporate Services Group and Carlisle offers significant
potential savings and synergy benefits; and

*   although Corporate Services Group is currently trading within the limits of
its borrowing facilities, Newco would have greater financial strength than
Corporate Services Group currently has.

If the Possible Merger is implemented the board of Newco would be as follows:

Kevin Mahoney (currently Chairman of Carlisle) would be Non-Executive Chairman
with particular focus on the effective integration of the two businesses;
Desmond Doyle (currently Chief Executive Officer of Corporate Services Group)
would be Chief Executive Officer; Richard Bradford (currently Chief Executive
Officer of Carlisle) would be Chief Operating Officer; Andrew Burchall
(currently Group Finance Director of Corporate Services Group) would be Group
Finance Director; and John Rowley (currently Development Director of Corporate
Services Group) would be Development Director.

The Senior Independent Director would be Noel Harwerth; Adrian Carey, Valerie
Scoular and Andrew Wilson would also be appointed as non-executive directors.
All are currently non-executive Directors of Corporate Services Group.

Lord Ashcroft holds 29.7 per cent. of the current issued share capital of
Corporate Services Group and 74.3 per cent. of the current issued share capital
of Carlisle. If the Possible Merger is implemented it is anticipated that Lord
Ashcroft would hold 53.3 per cent. of the issued share capital of Newco.

The Possible Merger is subject to the following pre-conditions:

(a)                completion, on terms satisfactory to Corporate Services
Group, of a due diligence review of Carlisle by Corporate Services Group;

(b)               completion, on terms satisfactory to Carlisle, of a due
diligence review of Corporate Services Group by Carlisle; and

(c)                final agreement of detailed terms by both boards.

The Possible Merger will also, if implemented, be subject to further terms and
conditions, including all necessary regulatory consents and approvals being
obtained before completion of the Possible Merger.

The Company has received an irrevocable undertaking from Dresdner VPV NV, which
owns 261,377,384 Corporate Services Group ordinary shares of 1p each ("Ordinary
Shares"), equivalent to 24.3 per cent of the issued share capital of Corporate
Services Group, confirming that it will vote in favour of the Scheme at the
court meeting, and in favour of all the resolutions necessary at the general
meeting of the Company, to enable the Possible Merger to proceed. This
irrevocable undertaking will lapse if no firm intention to make an offer for
Corporate Services Group is announced by 30 April 2008, or if final terms of the
Scheme are such that the legacy Corporate Services Group shareholders receive in
aggregate a consideration of ordinary shares in Newco equivalent to less than 47
per cent. of Newco, or if a third party makes an offer for Corporate Services
Group which attributes a value to each Ordinary Share that is greater than the
value attributed to each Ordinary Share under the Scheme.

The Company has also received an irrevocable undertaking from Lord Ashcroft and
his associated companies, which together holds 319,737,682 Ordinary Shares,
equal to 29.7 per cent. of the issued share capital of Corporate Services Group,
confirming that he and his associated companies will be bound by the terms of
the Scheme, and in favour of all the resolutions necessary at the general
meeting of the Company, to enable the Possible Merger to proceed.  The
irrevocable undertaking also confirms that Lord Ashcroft and his associated
companies will vote to approve the Belize Merger and will procure that Newco
gives an undertaking to the court to be bound by the Scheme. This irrevocable
undertaking will lapse under the same circumstances as that of the VPV
undertaking above.

Subject to the satisfaction (or waiver) of the pre-conditions and the boards of
both Corporate Services Group and Carlisle agreeing to proceed with the Possible
Merger, it is expected, although not certain, that appropriate documentation
would be sent to shareholders of both companies in March 2008. Following on from
this it is expected that a Corporate Services Group general meeting and
associated court meeting will take place in April 2008 and the transaction would
complete, and Newco shares would be admitted to trading on AIM, in May 2008.

This announcement does not amount to a firm intention on any party to make an
offer and, accordingly, there can be no assurance that the Possible Merger will
be implemented, or as to the terms of the Possible Merger, even if the
pre-conditions are satisfied (or waived).  Corporate Services Group reserves the
right in its absolute discretion to waive pre-condition (a) above and Carlisle
reserves the right in its absolute discretion to waive pre-condition (b) above.

Noel Harwerth, Acting Chairman of Corporate Services Group, commented: "A lot
has been achieved at Corporate Services Group over the last three years but now
is the time to move ahead with the company's future strategy. The Possible
Merger makes good sense both commercially and also from a financial point of
view. We believe that it would, if implemented, provide a robust platform for
acquisitions and growth in the future".

Commenting on the Possible Merger Lord Ashcroft said: "I am wholly supportive of
the Possible Merger. I believe that the proposed board of Newco is well balanced
and capable of delivering value for all shareholders and I would very much like
to see the enlarged group develop into a strong and independent public company.
With the increased scale and stronger financial base, which I believe will
result from the implementation of the Possible Merger, Newco will be well placed
to develop both organically and by acquisition".

Kevin Mahoney, Chairman of Carlisle and proposed Chairman of Newco, commented: 
"The Possible Merger is expected to bring a number of significant benefits to
Carlisle's shareholders.   These include a greater degree of liquidity in the
trading of shares and also benefits arising from economies of scale.  I believe
we can build a strong, prosperous group from the merger of these two companies".

For further enquires:

Corporate Services Group plc                                   Tel: 01582 692658
Noel Harwerth, Acting Chairman
Desmond Doyle, Chief Executive Officer
Andrew Burchall, Group Finance Director

Carlisle Group Limited                                         Tel: 01707 824000
Kevin Mahoney, Chairman
Richard Bradford, Chief Executive Officer

Landsbanki Securities (UK) Limited                            Tel: 020 7426 9000
(Financial adviser and Broker to Corporate Services Group)
James Wellesley Wesley
Claes Spang

Cenkos Securities plc                                         Tel: 020 7397 8900
(Financial adviser and Broker to Carlisle)
Nicholas Wells
Adrian Hargrave

Bell Pottinger Corporate & Financial
Nick Lambert                                                  Tel: 07811 358 764
Sarah Williams                                                Tel: 07904 932 904

Landsbanki Securities (UK) Limited, which is authorised and regulated in the
United Kingdom by The Financial Services Authority, is acting for Corporate
Services Group in relation to the matters described in this announcement and is
not advising any other person and accordingly will not be responsible to any
person other than Corporate Services Group for providing the protections
afforded to the customers of Landsbanki Securities (UK) Limited or for providing
advice in relation to the matters described in this announcement.

Cenkos Securities plc, which is authorised and regulated in the United Kingdom
by The Financial Services Authority, is acting for Carlisle in relation to the
matters described in this announcement and is not advising any other person and
accordingly will not be responsible to any person other than Carlisle for
providing the protections afforded to the customers of Cenkos Securities plc or
for providing advice in relation to the matters described in this announcement.

Further Information on the Possible Merger

The availability of the Possible Merger to Corporate Services Group shareholders
and Carlisle shareholders who are not resident in the United Kingdom may be
affected by the laws of relevant jurisdictions.  Corporate Services Group
shareholders and Carlisle shareholders who are not resident in the United
Kingdom will need to inform themselves about and observe any applicable
requirements.

This announcement does not constitute an offer or invitation to purchase any
securities or a solicitation of an offer to buy any securities, pursuant to the
offer or otherwise.

Any securities that might be offered pursuant to the Possible Merger described
in this announcement have not been registered under the applicable securities
laws of the United States, Australia, Canada or Japan.  Accordingly, any such
securities may not be offered, sold or delivered, directly or indirectly, in or
into the United States, Australia, Canada or Japan except pursuant to exemptions
from applicable requirements of such jurisdictions.

The Possible Merger will be subject to the applicable rules and regulations of
the UK Listing Authority, the London Stock Exchange, the Takeover Code and
Belizean law.

Disclosure in accordance with Rule 2.10 of the City Code

In accordance with Rule 2.10 of the City Code on Takeovers and Mergers,
Corporate Services Group confirms that it has 1,077,215,855 ordinary shares of 1
pence each in issue as at the close of business on 6 February 2008.

The ISIN reference for these securities is GB0002251600.

Dealing Disclosure Requirements

Under the provisions of Rule 8.3 of the Takeover Code (the "Code"), if any
person is, or becomes, "interested" (directly or indirectly) in 1 per cent. or
more of any class of "relevant securities" of Corporate Services Group, all "
dealings" in any "relevant securities" of that company (including by means of an
option in respect of, or a derivative referenced to, any such "relevant
securities") must be publicly disclosed by no later than 3.30 pm (London time)
on the London business day following the date of the relevant transaction. This
requirement will continue until the date on which the offer becomes, or is
declared, unconditional as to acceptances, lapses or is otherwise withdrawn or
on which the "offer period" otherwise ends. If two or more persons act together
pursuant to an agreement or understanding, whether formal or informal, to
acquire an "interest" in "relevant securities" of Corporate Services Group, they
will be deemed to be a single person for the purpose of Rule 8.3.

Under the provisions of Rule 8.1 of the Code, all "dealings" in "relevant
securities" of Corporate Services Group by Corporate Services Group or Carlisle,
or by any of their respective "associates", must be disclosed by no later than
12.00 noon (London time) on the London business day following the date of the
relevant transaction.

A disclosure table, giving details of the companies in whose "relevant
securities" "dealings" should be disclosed, and the number of such securities in
issue, can be found on the Takeover Panel's website at
www.thetakeoverpanel.org.uk.

"Interests in securities" arise, in summary, when a person has long economic
exposure, whether conditional or absolute, to changes in the price of
securities. In particular, a person will be treated as having an "interest" by
virtue of the ownership or control of securities, or by virtue of any option in
respect of, or derivative referenced to, securities.

Terms in quotation marks are defined in the Code, which can also be found on the
Panel's website. If you are in any doubt as to whether or not you are required
to disclose a "dealing" under Rule 8, you should consult the Panel."




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