TIDMCYH
RNS Number : 8961D
CybIT Holdings PLC
10 December 2009
Not for release, publication or distribution, in whole or in part, in, into or
from any jurisdiction where to do so would constitute a violation of the
relevant laws of such jurisdiction
10 December 2009
RECOMMENDED PROPOSALS FOR THE CASH ACQUISITION OF
CYBIT HOLDINGS
PLC
BY
CYBERSPACE BIDCO LIMITED
(TO BE EFFECTED BY MEANS OF A SCHEME OF ARRANGEMENT)
The boards of directors of Cyberspace Bidco Limited ("Bidco") and Cybit Holdings
plc ("Cybit") are pleased to announce that they have reached agreement on the
terms of a recommended cash acquisition by Bidco of the entire issued and to be
issued ordinary share capital of Cybit whereby shareholders of Cybit will
receive 75.0 pence per Cybit Share. The Acquisition will be effected by way of a
scheme of arrangement under Part 26 of the Companies Act.
Summary and highlights
-The terms of the Acquisition value the entire issued ordinary share capital of
Cybit (fully diluted for the exercise of all options under the Cybit Share
Option Schemes) at approximately GBP22.8 million. This cash consideration
represents a significant premium to the current Cybit Share price at a time when
the stock market carries uncertainty as to both pricing and liquidity.
-The consideration of 75.0 pence in cash for each Cybit Share represents:
-a premium of approximately 108.3 per cent. over the Closing Price of 36.0 pence
per Cybit Share on 9 December 2009, being the last dealing day prior to the
commencement of the Offer Period;
-a premium of approximately 95.6 per cent. over the average Closing Price of
38.3 pence per Cybit Share for the 1 month prior to the commencement of the
Offer Period;
-a premium of approximately 95.4 per cent. over the average Closing Price of
38.4 pence per Cybit Share for the 3 months prior to the commencement of the
Offer Period; and
-a premium of approximately 131.9 per cent. over the average Closing Price of
32.3 pence per Cybit Share for the 12 months prior to the commencement of the
Offer Period.
-Bidco holds irrevocable undertakings and letters of intent to vote in favour of
the Acquisition at the Court Meeting and the General Meeting, including from the
Cybit Directors, in respect of a total of 10,665,716 Scheme Shares representing,
in aggregate, approximately 38.9 per cent. of the existing issued ordinary share
capital of Cybit and approximately 35.0 per cent. of the enlarged issued
ordinary share capital of Cybit, assuming all outstanding share options were to
be exercised.
-The Acquisition will be effected by means of a scheme of arrangement between
Cybit and its shareholders pursuant to Part 26 of the Companies Act 2006. The
Scheme will require the approval of Scheme Shareholders and the sanction of the
Court.
-Cybit is a provider of telematics services for enterprises requiring strategic
management information relating to land and sea based mobile assets.
-Cybit was incorporated on 2 January 2001, was admitted to AIM on 16 March 2001
and has expanded both organically and through acquisition from that point. It
has completed six acquisitions over the last five years and has structured the
group around three principal divisions: Vehicle Telematics, Private Mobile Radio
and Maritime. In the UK, customers include KwikFit Mobile, Greene King,
Homeserve PLC, Northern Ireland Electricity and The Highways Agency. In mainland
Europe, customers include Flygfrakt, Beine Gruppe, HKS Spedition and Rubetrans.
-For the financial year ended 31 March 2009, Cybit had revenues of GBP25.5
million (FY2008: GBP19.7 million), operating profit of GBP3.9 million (FY2008:
GBP3.3 million) and profit before tax of GBP2.1 million (FY2008: GBP1.7
million). As at 31 March 2009, total assets were GBP24.3 million (FY2008:
GBP23.0 million), net assets were GBP14.1 million (FY2008: GBP12.2 million) and
net cash (before the deduction of long-term bank debt) was GBP2.0 million
(FY2008: GBP2.4 million).
-Bidco is a wholly-owned subsidiary of Francisco Partners, a global
technology-focused private equity firm that provides transformational capital to
reposition, recapitalise and rejuvenate companies. Francisco Partners has a
significant track record of making acquisitions in the technology sector.
-Francisco Partners was formed to pursue structured investment in technology
companies undergoing strategic, technological and operational change. Francisco
Partners has invested approximately $4 billion of equity capital in over 50
technology companies.
-Francisco Partners believes that it can enable Cybit to maintain and grow its
European telematics platform. As a result of Francisco Partners' private
ownership, the Cybit Directors believe that Cybit will have the operational and
financial flexibility in order to grow and transition its business both
organically and through continued acquisitions.
-Bidco is offering a cash consideration representing a significant premium to
the current share price at a time when the stock market carries uncertainty as
to both pricing and liquidity.
-The Cybit Directors, who have been so advised by Cenkos, consider the terms of
the Acquisition to be fair and reasonable. In providing advice to the Cybit
Directors, Cenkos has taken into account the commercial assessments of the Cybit
Directors.
-Accordingly, the Cybit Directors intend unanimously to recommend Scheme
Shareholders to vote in favour of the resolutions to be proposed at the Court
Meeting and the General Meeting, as they have undertaken to do in respect of
their own beneficial holdings of 1,765,205 Scheme Shares (representing, in
aggregate, approximately 6.4 per cent. of the Scheme Shares currently in issue).
Commenting on the Proposals, Neil Johnson, Non-Executive Chairman of Cybit,
said:
"We firmly believe that this transaction is in the best interests of our
shareholders and delivers value which would take much longer to achieve as a
listed company. The financial and operational flexibility afforded by Francisco
Partners' private ownership will enable Cybit to continue to drive growth to the
benefit of both our customers and employees."
"With these factors in mind, the Directors intend unanimously to recommend that
the shareholders vote in favour of the resolutions to be proposed at the Court
Meeting and the General Meeting."
Commenting on the Proposals, Richard Horsman, Chief Executive Officer of Cybit,
said:
"We believe that this transaction represents a win-win for our shareholders,
employees and customers and will enable us to continue to lead the market and
remain the trusted partner of choice. Bidco's offer reflects the great
importance it attaches to the skills and experience of the Cybit team and
represents a great outcome for all Cybit stakeholders."
Commenting on the Proposals, Deep Shah of Francisco Partners, said:
"Francisco Partners is excited about the potential opportunities in Cybit's core
markets, and is pleased to partner with the company to support its long-term
growth strategy. We also believe that Cybit has a highly talented and committed
team and we look forward to working with them to help the company achieve its
full potential."
Investec is acting as sole financial adviser to Bidco. Cenkos is acting as sole
financial adviser to Cybit.
This summary should be read in conjunction with the full text of the following
announcement and the appendices to it.
Enquiries:
Francisco Partners020 7907 8600
Deep Shah
Investec020 7597 5000
Andrew Pinder
Dominic Emery
Cybit0845 6027 123
Richard Horsman, CEO
Neil Johnson, Chairman
Cenkos020 7397 8900
Stephen Keys
Adrian Hargrave
Redleaf Communications020 7566 6700
Emma Kane
Rebecca Sanders-Hewett
A copy of the Announcement and the Scheme Document will be published on the
Cybit website at www.cybit.co.uk.
IMPORTANT NOTICE
The distribution of this Announcement in jurisdictions other than the United
Kingdom may be restricted by law and therefore any persons who are subject to
the laws of any jurisdiction other than the United Kingdom should inform
themselves about, and observe, any applicable requirements. Any failure to
comply with the restrictions may constitute a violation of the securities laws
of any such jurisdiction. This Announcement does not constitute an offer or an
invitation to purchase or subscribe for any securities or a solicitation of an
offer to buy any securities pursuant to this Announcement or otherwise in any
jurisdiction in which such offer or solicitation is unlawful. This Announcement
has been prepared for the purposes of complying with English law, the Code and
the AIM Rules 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 any jurisdiction outside England.
The statements contained in this Announcement are made as at the date of this
Announcement, unless some other time is specified in relation to them, and
service of this Announcement shall not give rise to any implication that there
has been no change in the facts set forth in this Announcement since such date.
Nothing contained in this Announcement shall be deemed to be a forecast,
projection or estimate of the future financial performance of Cybit or the Cybit
Group except where otherwise stated.
CAUTIONARY NOTE REGARDING FORWARD LOOKING STATEMENTS
This Announcement contains certain forward looking statements with respect to
the financial condition, results of operations and business of Cybit or the
Cybit Group and Bidco and certain plans and objectives of the boards of
directors of Cybit and Bidco. These forward looking statements can be identified
by the fact that they do not relate to historical or current facts. Forward
looking statements often use words such as "anticipate", "target", "expect",
"estimate", "intend", "plan", "goal", "believe", "will", "may", "should",
"would", "could" or other words of similar meaning. These statements are based
on assumptions and assessments made by the boards of directors of Cybit and
Bidco in the light of their experience and their perception of historical
trends, current conditions, expected future developments and other factors they
believe appropriate. By their nature, forward looking statements involve risk
and uncertainty and the factors described in the context of such forward looking
statements in this Announcement could cause actual results and developments to
differ materially from those expressed in or implied by such forward looking
statements.
Should one or more of these risks or uncertainties materialise, or should
underlying assumptions prove incorrect, actual results may vary materially from
those described in this Announcement. Cybit and Bidco assume no obligation to
update or correct the information contained in this Announcement.
DEALING DISCLOSURE REQUIREMENTS
Under the provisions of Rule 8.3 of the Code, if any person is, or becomes,
"interested", (directly or indirectly) in one per cent. or more of any class of
"relevant securities"' of Cybit, all "dealings" in any "relevant securities" of
Cybit (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
3.30pm (London time) on the Business Day following the date of the relevant
transaction. This requirement will continue until the Effective Date or until
the date on which the Scheme lapses or is otherwise withdrawn or, on which the
"offer period" otherwise ends (or, if Bidco elects to effect the Acquisition by
way of a takeover offer, until the date on which such 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 Cybit, 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 Cybit by Bidco or Cybit, or by any of their respective
"associates", must be disclosed by no later than 12:00 noon (London time) on the
Business Day following the date of the relevant transaction.
A disclosure table, giving details of the companies in whose "relevant
securities" "dealings" should be disclosed, and the number of such securities in
issue, can be found on the Panel's website at www.thetakeoverpanel.org.uk.
"Interests in securities" arise, in summary, when a person has long economic
exposure, whether conditional or absolute, to changes in the price of
securities. In particular, a person will be treated as having an "interest" by
virtue of the ownership or control of securities, or by virtue of any option in
respect of, or derivative referenced to, securities.
Terms in quotation marks, are defined in the Code, which can also be found on
the Panel's website at www.thetakeoverpanel.org.uk.
If you are in any doubt as to the application of Rule 8 to you, please contact
an independent financial adviser authorised under the Financial Services and
Market Act 2000, consult the Panel's website at www.thetakeoverpanel.org.uk or
contact the Panel on telephone number +44 (0) 20 7638 0129; fax +44 (0) 20 7236
7013.
Not for release, publication or distribution, in whole or in part, in, into or
from any jurisdiction where to do so would constitute a violation of the
relevant laws of such jurisdiction
10 December 2009
RECOMMENDED PROPOSALS FOR THE CASH ACQUISITION OF
CYBIT HOLDINGS
PLC
BY
BIDCO
(TO BE EFFECTED BY MEANS OF A SCHEME OF ARRANGEMENT)
1.Introduction
The Boards of Cybit and Bidco are pleased to announce that they have reached
agreement on the terms of a recommended cash acquisition of the entire issued
and to be issued ordinary share capital of Cybit by Bidco. The Acquisition is to
be effected by means of a scheme of arrangement under Part 26 of the Companies
Act. The Acquisition requires the approval of Scheme Shareholders and the
sanction of the Court. The Acquisition values the enlarged issued ordinary share
capital (fully diluted for the exercise of all options under the Cybit Share
Option Schemes), at approximately GBP22.8 million.
2.Recommendation
The Cybit Directors, who have been so advised by Cenkos, consider the terms of
the Acquisition to be fair and reasonable. In providing advice to the Cybit
Directors, Cenkos has taken into account the commercial assessments of the Cybit
Directors.
Accordingly, the Cybit Directors intend unanimously to recommend to Scheme
Shareholders to vote in favour of the resolutions to be proposed at the Court
Meeting and the General Meeting, as they have irrevocably undertaken to do in
respect of their own beneficial holdings of 1,765,205 Scheme Shares
(representing, in aggregate, approximately 6.4 per cent. of the Scheme Shares
currently in issue).
3.Summary of the terms of the Acquisition and the Scheme
Consideration
The Acquisition is to be effected by way of a scheme of arrangement between
Cybit and its shareholders under Part 26 of the Companies Act. The Scheme will
be subject to the satisfaction (or, if applicable, waiver) of the Conditions as
described in Appendix I. Following the Scheme becoming effective, the entire
issued ordinary share capital of Cybit will be held by Bidco.
In accordance with the terms of the Scheme, Scheme Shareholders will be entitled
to receive:
for each Scheme Share75.0 pence in cash
The consideration of 75.0 pence in cash for each such Scheme Share represents:
-a premium of approximately 108.3 per cent. over the Closing Price of 36.0 pence
per Scheme Share on 9 December 2009 being the last dealing day prior to the
commencement of the Offer Period;
-a premium of approximately 95.6 per cent. over the average Closing Price of
38.3 pence per Scheme Share for the 1 month prior to the commencement of the
Offer Period;
-a premium of approximately 95.4 per cent. over the average Closing Price of
38.4 pence per Scheme Share for the 3 months prior to the commencement of the
Offer Period; and
-a premium of approximately 131.9 per cent. over the average Closing Price of
32.3 pence per Scheme Share for the 12 months prior to the commencement of the
Offer Period.
4.Background to and reasons for recommending the proposals
Despite Cybit's track record and growth, the Cybit Board has remained aware that
the Cybit share price performance has been impaired by a number of factors
including the Company's limited scale and the low level of dealings in the
shares.
Following an approach by Francisco Partners, the Cybit Board held detailed
discussions regarding the terms of a potential acquisition of Cybit by Bidco.
These discussions have resulted in the proposed recommended acquisition of Cybit
by Bidco at a price of 75.0 pence cash per Scheme Share.
The Cybit Board has evaluated the proposals from Bidco on behalf of Scheme
Shareholders as a whole. It has weighed the benefits of maintaining an
independent London listing against the operational constraints of running a
publicly traded company. The Cybit Board believes that the Acquisition will give
Cybit significantly more financial and operational flexibility to grow and
transition its business both organically and through continued acquisitions. The
Cybit Board also considers that, whilst there is significant potential for
future growth in equity value for investors, any future growth is uncertain and
that Scheme Shareholders should be given the opportunity to realise value from
their investment in cash immediately at an attractive and significant premium to
the current share price.
The consideration offered under the Acquisition represents a premium of 108.3
per cent. to the Closing Price of a Scheme Share of 36.0 pence per Scheme Share
on 9 December 2009 (being the last Business Day prior to the commencement of the
Offer Period) and a premium of 131.9 per cent to the average Closing Price of a
Scheme Share of 32.3 pence for the 12 months prior to 10 December 2009.
Accordingly, the Cybit Board believes that the Acquisition is in the best
interests of Scheme Shareholders, and intend unanimously to recommend that Cybit
Shareholders vote in favour of the Acquisition, as they have irrevocably
undertaken to do in respect of their entire beneficial holdings comprising, in
aggregate, 6.4 per cent. of Cybit's existing issued ordinary share capital.
5.Reasons for the proposals
Bidco is a wholly-owned subsidiary of Francisco Partners, a global
technology-focused private equity firm that provides transformational capital to
reposition, recapitalise and rejuvenate companies. Francisco Partners has a
significant track record of making acquisitions in the technology sector.
Francisco Partners believes that it can enable Cybit to maintain and grow its
European telematics platform. As a result of Francisco Partners' private
ownership, the Cybit Directors believe that Cybit will have the financial and
operational flexibility in order to grow and transition its business both
organically and through continued acquisitions.
Bidco is offering a cash consideration representing a significant premium to the
current share price at a time when the stock market carries uncertainty as to
both pricing and liquidity.
6.Management and employees
Bidco has assured the Cybit Board that it attaches great importance to the
skills and experience of the existing management and employees of Cybit and that
it believes that opportunities for the employees will be enhanced in the event
that the Acquisition is completed.
Bidco has also confirmed that it has no plans to alter existing arrangements
with employees or to change the locations of the Cybit Group's places of
business.
Bidco has given assurances to the Cybit Directors that, on the Acquisition
becoming effective, the existing employment rights, including pension rights, of
all employees of Cybit will be fully safeguarded.
7.Irrevocable undertakings and letters of intent
As at the latest practicable date prior to the publication of this Announcement,
Bidco was in receipt of irrevocable undertakings and letters of intent 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 a total of 10,665,716 Scheme
Shares, representing, in aggregate, approximately 38.9 per cent. of the existing
issued ordinary share capital of Cybit and approximately 35.0 per cent. of the
enlarged issued ordinary share capital of Cybit, assuming all outstanding share
options were to be exercised.
Further details of these undertakings are set out in paragraphs (A) and (B)
below.
(A)Directors' Irrevocable Undertakings
Each of the Cybit Directors has irrevocably undertaken 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 their beneficial holdings, as noted below, being
Scheme Shares representing, in aggregate, approximately 6.4 per cent. of the
existing issued ordinary share capital of Cybit. The terms of these irrevocable
undertakings will continue to be binding in the event that a higher competing
offer is made for Cybit.
+----------------------------------------------------------+------------+------------+
| | | |
+----------------------------------------------------------+------------+------------+
| | Number of | Percentage |
| | Scheme | of |
| | Shares | existing |
| | | issued |
| | | ordinary |
| | | share |
| | | capital |
+----------------------------------------------------------+------------+------------+
| | | |
+----------------------------------------------------------+------------+------------+
| Mr. NA Johnson | 797,132 | 2.9 |
+----------------------------------------------------------+------------+------------+
| Mr. RJ Horsman | 842,133 | 3.1 |
+----------------------------------------------------------+------------+------------+
| Mr. KB Lawrence | 89,940 | 0.3 |
+----------------------------------------------------------+------------+------------+
| Mr. DA Robins | 36,000 | 0.1 |
+----------------------------------------------------------+------------+------------+
| | | |
+----------------------------------------------------------+------------+------------+
| TOTAL | 1,765,205 | 6.4 |
+----------------------------------------------------------+------------+------------+
| | | |
+----------------------------------------------------------+------------+------------+
| | | |
+----------------------------------------------------------+------------+------------+
(B)Other Undertakings and Letters of Intent
Undertakings and letters of intent from other Shareholders to vote in favour of
the Scheme at the Court Meeting and the Special Resolution to be proposed at the
General Meeting have been received by Bidco in respect of a total of Scheme
Shares, representing, in aggregate, approximately 32.4 per cent. of the existing
issued ordinary share capital of Cybit, from the following persons and entities.
+----------------------------------------------------------+------------+------------+
| | | |
+----------------------------------------------------------+------------+------------+
| | Number of | Percentage |
| | Scheme | of |
| | Shares | existing |
| | | issued |
| | | ordinary |
| | | share |
| | | capital |
+----------------------------------------------------------+------------+------------+
| | | |
+----------------------------------------------------------+------------+------------+
| Slater Investments | 3,424,534 | 12.5 |
+----------------------------------------------------------+------------+------------+
| Helium Special Situations | 2,390,000 | 8.7 |
+----------------------------------------------------------+------------+------------+
| Legal & General Investment Management | 1,000,000 | 3.6 |
+----------------------------------------------------------+------------+------------+
| Pelham Olive | 882,154 | 3.2 |
+----------------------------------------------------------+------------+------------+
| Brewin Dolphin | 653,823 | 2.4 |
+----------------------------------------------------------+------------+------------+
| Octopus Investments | 550,000 | 2.0 |
+----------------------------------------------------------+------------+------------+
| | | |
+----------------------------------------------------------+------------+------------+
| | | |
+----------------------------------------------------------+------------+------------+
| TOTAL | 8,900,511 | 32.4 |
+----------------------------------------------------------+------------+------------+
| | | |
+----------------------------------------------------------+------------+------------+
| | | |
+----------------------------------------------------------+------------+------------+
| | | |
+----------------------------------------------------------+------------+------------+
The terms of the undertakings from the Cybit Directors will continue to be
binding in the event that a higher competing offer is made for Cybit.
The terms of the undertakings from Helium Special Situations, Legal & General
Investment Management and Brewin Dolphin will cease to be binding in the event
that a higher competing offer is made representing an improvement of at least 10
per cent. above 75.0 pence per Scheme Share.
The terms of the undertakings from Pelham Olive will cease to be binding in the
event that a higher competing offer is made representing an improvement of at
least 5 per cent. above 75.0 pence per Scheme Share.
Bidco has also received letters of intent to vote in favour of the Proposals
from Slater Investments and Octopus Investments in respect of 3,974,534 shares
representing approximately 14.5 per cent. of the entire issued ordinary share
capital of Cybit.
The circumstances in which these undertakings will cease to be binding are set
out in Appendix IV.
8.The Scheme
(A)Scheme Mechanism
The Acquisition is to be effected by means of a scheme of arrangement between
Cybit and its shareholders under Part 26 of the Companies Act. The purpose of
the Scheme is to provide for Bidco to become the owner of the whole of the
issued and to be issued ordinary share capital of Cybit. The Scheme Shares held
by Scheme Shareholders will be cancelled and the reserve arising from such
cancellation will be applied to pay up in full an equal number of New Cybit
Shares; those New Cybit Shares will be issued to Bidco and/or its nominees.
To become effective, the Scheme requires the approval of a majority in number of
those Scheme Shareholders, present and voting, either in person or by proxy, at
the Court Meeting, representing 75 per cent. or more in value of all Cybit
Shares held by such Scheme Shareholders. The Scheme also requires the sanction
of the Court and the passing of a Special Resolution to implement the Scheme at
the General Meeting, as well as satisfaction or, if applicable, waiver of the
other Conditions set out in Appendix I of this Announcement. Upon the Scheme
becoming effective in accordance with its terms, it will be binding on all
Scheme Shareholders, irrespective of whether or not they attended or voted at
the Court Meeting or the General Meeting.
The last day of dealings in, and for registration of transfer of, Scheme Shares
is expected to be on 20 January 2010 (the dealing day immediately prior to the
expected date of the Second Court Hearing), following which trading of Scheme
Shares on AIM will cease. It is intended that the Shares will cease to be
admitted to trading on AIM on, or shortly after, the Effective Date.
(B)Sanction of the Scheme by the Court
Under the Companies Act, the Scheme will require the sanction of the Court. The
Court Hearings to sanction the Scheme and to confirm the Capital Reduction
comprised in the Scheme are expected to be held on 19 January 2010 and 21
January 2010, respectively. Each of Bidco and Cybit has confirmed that it will
be represented by counsel at the Court Hearings so as to consent to the Scheme
and to undertake to the Court to be bound thereby.
The Scheme will become effective in accordance with its terms on delivery of a
copy of the Orders and a statement of capital (approved by the Court) to the
Registrar.
If the Scheme becomes effective it will be binding on all Shareholders
irrespective of whether or not they attended or voted in favour of the Scheme at
the Court Meeting or in favour of the Special Resolution at the General Meeting.
If the Scheme does not become effective by 1 March 2010 (or such later date (if
any) as Cybit and Bidco may, with the consent of the Panel, agree and (if
required) the Court may allow) the Scheme will not become effective and the
Acquisition will not proceed.
(C)Section 593 Valuation
As at the latest practicable date prior to the publication of this Announcement,
Bidco neither owned nor controlled any Scheme Shares. It is intended that, in
the period after the General Meeting and before the First Court Hearing, Bidco
will acquire at least one Scheme Share which will mean that Bidco will be a
member of Cybit on the Effective Date and accordingly there will be no
requirement under section 593 of the Companies Act for an independent valuation
of the New Cybit Shares to be allotted to Bidco under the Scheme.
9.Amendments to Cybit's Articles of Association
It will be proposed that Cybit's Articles of Association be amended to ensure
that any Shares which are issued after the General Meeting but before the Scheme
Record Time will be subject to and bound by the Scheme. Any Shares issued
(including on the exercise of options under the Cybit Share Option Schemes) on
or after the Scheme Record Time will not be subject to the Scheme. Accordingly,
it is proposed that Cybit's Articles of Association also be amended so that any
Shares issued to any person (other than under the Scheme or to Bidco or its
nominees) on or after the Scheme Record Time will automatically be acquired by
Bidco in consideration of the payment by Bidco to such person of such amount of
consideration as would have been payable pursuant to the Scheme for each such
Share as if it were subject to the Scheme.
10.Information on Cybit
Cybit is a provider of telematics services for enterprises requiring strategic
management information relating to land and sea based mobile assets.
Cybit was incorporated on 2 January 2001, was admitted to AIM on 16 March 2001
and has expanded both organically and through acquisition from that point. It
has completed six acquisitions over the last five years and has structured the
group around three principal divisions: Vehicle Telematics, Private Mobile Radio
and Maritime. In the UK, customers include KwikFit Mobile, Greene King,
Homeserve PLC, Northern Ireland Electricity and The Highways Agency. In mainland
Europe, customers include Flygfrakt, Beine Gruppe, HKS Spedition and Rubetrans.
For the financial year ended 31 March 2009, Cybit had revenues of GBP25.5
million (FY2008: GBP19.7 million), operating profit of GBP3.9 million (FY2008:
GBP3.3 million) and profit before tax of GBP2.1 million (FY2008: GBP1.7
million). As at 31 March 2009, total assets were GBP24.3 million (FY2008:
GBP23.0 million), net assets were GBP14.1 million (FY2008: GBP12.2 million) and
net cash (before the deduction of long-term bank debt) was GBP2.0 million
(FY2008: GBP2.4 million).
Despite tough trading conditions, and taking into account recent corporate
activity Cybit performed in line with the Cybit Directors' expectations in the
period ending 30 September 2009 and, accordingly, the Cybit Directors are
confident in the long-term prospects of the Company.
As at the date of this Announcement, Cybit had 27,451,767 ordinary shares of
five pence each in issue.
11.Information on Bidco
Bidco is a newly-incorporated private limited company which has been formed and
is controlled by investment funds advised by Francisco Partners for the purposes
of implementing the proposals. Bidco is a wholly-owned subsidiary of Francisco
Partners. Bidco has not traded since its date of incorporation nor has it
entered into any obligations other than in connection with the Acquisition and
the financing of the Acquisition. The sole director of Bidco is Mr. Deep Shah.
Bidco does not currently have any subsidiaries or subsidiary undertakings.
12.Information on Francisco Partners
Francisco Partners is one of the world's largest technology-focused private
equity funds. The firm was founded to pursue structured investment in technology
companies undergoing strategic, technological and operational change. Francisco
Partners has a significant track record of making acquisitions in the technology
sector having invested approximately $4 billion of equity capital in over 50
technology companies.
More information is available at www.franciscopartners.com.
13.Financing arrangements for the Acquisition
Bidco will fund the cash consideration payable under the terms of the
Acquisition from the cash proceeds of an issue by Bidco of equity capital to
Francisco Partners' own private equity funds which currently have uncalled
capital commitments of approximately $600 million.
Bidco has no third party debt financing requirement but notes that HSBC has
consented to continue its current loans to Cybit following the implementation of
the Scheme.
Investec, financial adviser to Bidco, has confirmed that it is satisfied that
sufficient resources are available to satisfy in full the cash consideration
payable by Bidco to Scheme Shareholders under the terms of the Scheme.
14.Implementation Agreement
Cybit, Francisco Partners II (Cayman), L.P. and Bidco have entered into the
Implementation Agreement, which governs their relationship during the period
until the Scheme becomes effective. Amongst other things, Bidco and Cybit have
agreed to co-operate with regard to the process required to implement the Scheme
and Cybit has entered into certain undertakings concerning the conduct of its
business during that period.
The Implementation Agreement contains provisions for a mutual inducement and
break fee agreement pursuant to which Cybit has agreed to pay an inducement fee
of GBP223,278 (equal to approximately 1% of the value of Cybit by reference to
the price offered under the Proposals) to Bidco if, following the release of the
Announcement, the Cybit Directors fail to recommend the Scheme or the Cybit
Directors withdraw, modify or adversely qualify or amend their recommendation of
the Acquisition or a superior offer for the Scheme Shares is announced and
subsequently the Scheme lapses, is terminated or otherwise does not become
effective for any reason whatsoever before 1 March 2010 other than as a result
of:
(a)any approvals or clearances required by law or regulation not having been
obtained by Bidco; or
(b)a wilful default on the part of Bidco to proceed to completion of the
Acquisition.
Bidco has agreed to pay a sum of an amount equal to the inducement fee of
GBP223,278 to Cybit if Bidco commits a material breach of the Implementation
Agreement and the Scheme does not proceed or is not implemented in consqeuence
of such breach.
The Implementation Agreement includes an undertaking by Cybit that it will not
permit any member of the Cybit Group or any of its or their respective
directors, officers, agents or senior employees, and shall use all reasonable
endeavours to procure that none of its or their respective advisers shall, prior
to the earlier of (i) the Effective Date and (ii) termination of the
Implementation Agreement in accordance with its terms, directly or indirectly
solicit, initiate, encourage or otherwise seek to procure a competing offer for
Cybit or, save as otherwise permitted by the Implementation Agreement, enter
into any discussions or communications with any other person in response to
their making an unsolicited competing offer for Cybit or unsolicited approach in
respect of such a competing offer. If any other person does make such an
unsolicited offer or approach, Cybit will promptly inform Bidco thereof and
shall keep Bidco informed as to the progress of any such unsolicited offer or
approach, and Cybit shall procure that, save as otherwise provided in the
Implementation Agreement, the Cybit Directors do not withhold, withdraw, change
or modify their recommendation of the Acquisition.
15.Anticipated timetable
Cybit anticipates that it will dispatch the Scheme Document to Cybit
Shareholders and, for information only, to holders of options granted under the
Cybit Share Option Schemes and to holders of exchangeable Shares, within the
next 28 days (or such later date as may be agreed with the Panel), that the
Court Meeting and Cybit General Meeting will take place in January 2010, and
subject to the Scheme becoming unconditional and effective in accordance with
its terms, the Effective Date will occur in January 2010. A full anticipated
timetable will be set out in the Scheme Document.
Investec, which is authorised and regulated in the United Kingdom by the FSA, is
acting exclusively for Bidco and no one else in connection with the Acquisition
and other matters referred to in this Announcement and the Scheme and will not
be responsible to anyone other than Bidco for providing the protections afforded
to clients of Investec nor for giving advice in relation to the Acquisition and
the Scheme or any other matter or arrangement referred to in this Announcement.
Cenkos, which is authorised and regulated in the United Kingdom by the FSA, is
acting exclusively for Cybit and no one else in connection with the Acquisition
and the Scheme and will not be responsible to anyone other than Cybit for
providing the protections afforded to clients of Cenkos nor for giving advice in
relation to the Acquisition and the Scheme or any other matter or arrangement
referred to in this Announcement.
The Cybit Directors accept responsibility for the information contained in this
Announcement except for information for which the sole Bidco Director and
Francisco Partners accept responsibility. To the best of the knowledge and
belief of the Cybit Directors (who have taken all reasonable care to ensure that
such is the case), the information contained in this Announcement for which they
are responsible is in accordance with the facts and does not omit anything
likely to affect the import of such information.
The sole Bidco Director and Francisco Partners accept responsibility for the
information contained in this Announcement relating to Bidco, the sole Bidco
Director and Francisco Partners (including their respective families, related
trusts or companies and the persons connected with them within the meaning of
section 252 of the Companies Act 2006), parties acting in concert with Bidco for
the purposes of the Code, Bidco's future plans for the Cybit Group, its
management and employees and acquisition financing relating to Bidco. To the
best of the knowledge and belief of the sole Bidco Director and Francisco
Partners (who have each taken all reasonable care to ensure that such is the
case), the information contained in this document for which they are responsible
is in accordance with the facts and does not omit anything likely to affect the
import of such information.
The distribution of this Announcement in jurisdictions other than the United
Kingdom may be restricted by law and therefore persons into whose possession
this Announcement comes should inform themselves about, and observe, such
restrictions. Any failure to comply with these restrictions may constitute a
violation of the securities laws of any such jurisdiction.
Cautionary note regarding forward looking statements:
This Announcement contains certain forward looking statements with respect to
the financial condition, results of operations and business of Cybit or the
Cybit Group, or Bidco or the Enlarged Group and certain plans and objectives of
the boards of directors of Cybit and Bidco. These forward looking statements can
be identified by the fact that they do not relate to historical or current
facts. Forward looking statements often use words such as "anticipate",
"target", "expect", "estimate", "intend", "plan", "goal", "believe", "will",
"may", "should", "would", "could", "potential" or other words of similar
meaning. These statements are based on assumptions and assessments made by the
boards of directors of Cybit and Bidco in the light of their experience and
their perception of historical trends, current conditions, expected future
developments and other factors they believe appropriate. By their nature,
forward looking statements involve risk and uncertainty and the factors
described in the context of such forward looking statements in this Announcement
could cause actual results and developments to differ materially from those
expressed in or implied by such forward looking statements.
Should one or more of these risks or uncertainties materialise, or should
underlying assumptions prove incorrect, actual results may vary materially from
those described in this Announcement. Although Cybit and Bidco believe that the
expectations reflected in any such forward looking statements are reasonable,
Cybit and Bidco can give no assurance that such expectations will prove to have
been correct. Cybit and Bidco caution you not to place undue reliance on these
forward looking statements, which speak only as of the date of this
Announcement. Cybit and Bidco assume no obligation to update or correct the
information contained in this Announcement.
Dealing disclosure requirements
Under the provisions of Rule 8.3 of the Code, if any person is, or becomes,
"interested" (directly or indirectly) in one per cent. or more of any class of
"relevant securities" of Cybit or Bidco, all "dealings" in any "relevant
securities of that company (including by means of an option in respect of, or a
derivative referenced to, any such relevant securities") must be publicly
disclosed by no later than 3.30 p.m. on the business day following the date of
the relevant transaction. This requirement will continue until the Effective
Date or until the date on which the Scheme lapses or is otherwise withdrawn or
on which the "Offer Period" otherwise ends (or, if Bidco elects to effect the
Acquisition by way of a Takeover Offer, until the date on which such Takeover
Offer becomes, or is declared, unconditional as to acceptances, lapses or is
otherwise withdrawn or on which the relevant "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
Cybit or Bidco, 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 Cybit or Bidco by Cybit or Bidco, or by any of their respective
associates, must be disclosed by no later than 12.00 noon on the business day
following the date of the relevant transaction.
A disclosure table, giving details of the companies in whose "relevant
securities "dealings" should be disclosed, and the number of such securities in
issue, can be found on the Panel's website at www.thetakeoverpanel.org.uk.
"Interests in securities" arise, in summary, when a person has long economic
exposure, whether conditional or absolute, to changes in the price of
securities. In particular, a person will be treated as having an "interest" by
virtue of the ownership or control of securities, or by virtue of any option in
respect of, or derivative referenced to, securities.
Terms in quotation marks are defined in the Code, which can also be found on the
Panel's website. If you are in any doubt as to whether or not you are required
to disclose a dealing under Rule 8, please contact an independent financial
adviser authorised under FSMA, consult the Panel's website at
www.thetakeoverpanel.org.uk or contact the Panel on telephone number + 44 (0) 20
7638 0129.
Appendix I
CONDITIONS TO THE IMPLEMENTATION OF THE SCHEME AND THE
ACQUISITION
1.Conditions
1.1The Acquisition is conditional upon the Scheme becoming unconditional and
effective, by not later than 1 March 2010, or such later date (if any) as Cybit
and Bidco may, with the consent of the Panel, agree and the Court may allow. The
Scheme will be subject to the following Conditions:
(a)the approval by a majority in number, representing not less than
three-fourths in value, of those Scheme Shareholders who are present and vote,
either in person or by proxy, at the Court Meeting or at any adjournment
thereof;
(b)the Special Resolution required to approve and implement the Scheme being
duly passed by the requisite majority at the General Meeting (or at any
adjournment of such meeting); and
(c)the sanction of the Scheme the confirmation of the reduction of capital
involved therein by the Court (in either case, without modifications or with
modification on terms acceptable to Cybit and Bidco) and a copy of the Orders
being delivered for registration to the Registrar of Companies in England and
Wales.
1.2The Acquisition is also conditional upon satisfaction, fulfilment or waiver
(if capable of waiver) of the following Conditions (and Cybit and Bidco have
agreed that the necessary action to make the Scheme effective (including any
application to the Court for the sanction of the Scheme and/or the confirmation
to the reduction of capital involved therein) will not be taken unless the
following Conditions have been satisfied, fulfilled or waived):
(a)save as disclosed in Cybit's annual report and accounts for the financial
year ended 31 March 2009 or as publicly announced by Cybit (by the delivery of
an announcement to a Regulatory Information Service), there being no provision
of any agreement, arrangement, licence, permit or other instrument to which any
member of the Cybit Group is a party or by or to which any such member or any of
its assets may be bound, entitled or subject which in consequence of the Scheme
or the proposed cancellation of any shares or other securities in Cybit or
because of a change in the control or management of Cybit or otherwise, might
reasonably be expected to result in, to an extent which is material in the
context of the Cybit Group taken as a whole:
(i)any moneys borrowed by or any other indebtedness of, or grant available to,
any such member, being or becoming repayable or capable of being declared
repayable immediately or earlier than their or its stated maturity date or
repayment date or the ability of any such member to borrow moneys or incur any
indebtedness being withdrawn or inhibited or being capable of becoming or being
withdrawn or inhibited;
(ii)any such agreement, arrangement, licence, permit or instrument or the
rights, liabilities, obligations or interests of any such member thereunder
being terminated or adversely modified or affected or any obligation or
liability arising thereunder;
(iii)any material assets or interests of any such member being or failing to be
disposed of or charged or any right arising under which any such asset or
interest could be required to be disposed of or charged;
(iv)the creation or enforcement of any mortgage, charge or other security
interest over the whole or any part of the business, property or assets of any
such member;
(v)the financial or trading position of the Cybit Group being prejudiced or
adversely affected;
(vi)any such member ceasing to be able to carry on business under any name
under which it presently does so; or
(vii)the creation of any liability, actual or contingent, by any such member,
other than in the ordinary course of business and no event having occurred
which, under any provision of any agreement, arrangement, licence, permit or
other instrument might reasonably be expected to result in any of the events or
circumstances as are referred to in sub-paragraph (i) to (vii) of this Condition
(b) occurring, in each case to an extent which is material in the context of the
Cybit Group taken as whole;
(b)no third party having decided to take, institute, implement or threaten any
action, proceeding, suit, investigation, enquiry or reference, or having
enacted, made or proposed any statute, regulation, decision or order, or having
taken any other steps which would or might be reasonably expected to:
(i)require, prevent or materially delay the divestiture, or materially alter
the terms envisaged for any proposed divestiture, by Bidco or any member of the
Cybit Group of all or any material portion of their respective businesses,
assets or property or impose any material limitation on the ability of any of
them to conduct their respective businesses (or any of them) or to own any of
their respective assets or properties or any part thereof which in any such case
is material in the context of the Cybit Group taken as a whole;
(ii)require the divestiture by Bidco of any shares or other securities in any
member of the Cybit Group or prevent or delay any such divestiture to any extent
which is material in the context of Bidco or the Cybit Group, in either case,
taken as a whole;
(iii)impose any material limitation on, or result in a material delay in, the
ability of Bidco, to acquire or to hold or to exercise effectively any rights of
ownership in respect of shares or loans or securities convertible into shares or
any other securities (for the equivalent) in any member of the Cybit Group or to
exercise management control over any such member;
(iv)adversely affect the business, assets or profits of any member of the Cybit
Group to an extent which is material in the context of the Cybit Group taken as
a whole;
(v)make the Acquisition or its implementation or the acquisition or proposed
acquisition by Bidco of any shares or other securities in, or control of Cybit
void, illegal and/or unenforceable under the laws of any relevant jurisdiction,
or otherwise, directly or indirectly, materially restrain, restrict, prohibit,
delay or otherwise interfere with the same or impose material additional
conditions or obligations with respect thereto, or otherwise challenge or
interfere therewith in a material respect;
(vi)require Bidco or the Cybit Group to offer to acquire any shares or other
securities (or the equivalent) or interest in any member of the Cybit Group or
Bidco owned by any third party (other than in the implementation of the
Acquisition) which, in any such case, is material in the context of the Cybit
Group or Bidco, in either case, taken as a whole;
(vii)impose any limitation on the ability of any member of the Cybit Group to
co-ordinate its business, or any part of it, with the businesses of any other
members which is material in the context of the Cybit Group taken as a whole; or
(viii)result in any member of the Cybit Group ceasing to be able to carry on
business under any name under which it presently does so which in any such case
is material in the context of the Cybit Group taken as a whole,
and all applicable waiting and other time periods during which any such third
party, could institute, implement or threaten any action, proceeding, suit,
investigation, enquiry or reference or otherwise intervene under the laws of any
jurisdiction in respect of the Acquisition, having lapsed or been terminated;
(c)all necessary filings or applications having been made in connection with
the Acquisition and all or any applicable waiting and other time periods
(including any extensions thereof (including requests for additional
information)) under any applicable legislation or regulation of any material
jurisdiction having expired, lapsed or terminated and all statutory or
regulatory obligations in any jurisdiction having been complied with in
connection with the Acquisition or the acquisition by Bidco of any shares or
other securities in, or control of, Cybit and all authorisations, orders,
recognitions, grants, consents, licences, confirmations, clearances, permissions
and approvals ("Authorisations") for or in respect of the Acquisition
(including, without limitation, their implementation) or the proposed
acquisition of any shares or other securities in, or control of, Cybit by Bidco
having been obtained in terms and in a form reasonably satisfactory to Bidco
(acting reasonably) from all appropriate third parties or persons with whom any
member of the Cybit Group has entered into contractual arrangements in each case
where the absence of such Authorisation would have a material adverse effect on
the Cybit Group taken as a whole and all such Authorisations together with all
material Authorisations necessary to carry on the business of any member of the
Cybit Group as currently carried on remaining in full force and effect and all
filings necessary for such purpose having been made and there being no notice or
intimation of any intention to revoke or not to renew any of the same at the
time at which the Scheme becomes effective and all necessary statutory or
regulatory obligations in any jurisdiction applicable or relevant to any member
of the Cybit Group (or by which any property, business or asset of any such
member is bound or affected) having been complied with in each case in respect
of the Acquisition or the proposed acquisition of any Shares or other securities
in, or control of, Cybit by Bidco and in each case where a failure to comply
with such obligations would have a material adverse effect on the Cybit Group
taken as a whole;
(d)since 31 March 2009 and save as disclosed in Cybit's annual report and
accounts for the year ended 31 March 2009 or as publicly announced by Cybit (by
the delivery of an announcement to a Regulatory Information Service), no member
of the Cybit Group having to an extent which is material in the context of the
Cybit Group as a whole:
(i)issued, authorised or proposed the issue of additional shares of any class
other than any such issue by a wholly-owned subsidiary of Cybit to Cybit or
another wholly-owned subsidiary of Cybit or the issue of Scheme Shares in
accordance with the requirements of the Cybit Share Option Schemes;
(ii)issued or agreed to issue, authorised or proposed the issue of securities
convertible into shares of any class or rights, warrants or options to subscribe
for, or acquire, any such shares or convertible securities other than any such
issue by a wholly-owned subsidiary of Cybit to Cybit or another wholly-owned
subsidiary of Cybit or the grant of options under the Cybit Share Option
Schemes;
(iii)recommend, declared, paid or made or proposed to recommend, declare, pay
or make any dividend, bonus or other distribution whether payable in cash or
otherwise (other than to Cybit or another member of the Cybit Group);
(iv)save for transactions with another member of the Cybit Group, merged with,
or demerged from, any body corporate 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 proposed or announced any intention to propose any merger,
demerger, acquisition or disposal, transfer, mortgage, charge or security
interest over any material assets in each case to an extent which is material in
the context of the Cybit Group taken as a whole;
(v)save for transactions between members of the Cybit Group
(A)made or authorised or proposed or announced an intention to propose any
change in its loan capital which is material in the context of the Cybit Group;
(B)issued, authorised or proposed the issue of any debentures which issue is
material in the context of the Cybit Group; or
(C)save in the ordinary course of business incurred or increased any
indebtedness or become subject to any contingent liability which is material in
the context of the Cybit Group;
(vi)other than as between Cybit and wholly-owned subsidiaries of Cybit in
respect of transactions which do not include any shares or other securities of
Cybit, purchased, redeemed or repaid or announced any proposal to purchase,
redeem or repay any of its own shares or other securities or reduced or, save in
respect of the matters mentioned in sub-paragraph (i) above, made any other
change to any part of its share capital;
(vii)save for the Scheme, implemented, or authorised, proposed or announced its
intention to implement, any reconstruction, amalgamation, scheme, commitment or
other transaction or arrangement in respect of itself or another member of the
Cybit Group;
(viii)entered into or significantly changed the terms of any contract with any
Director or Senior Executive of Cybit;
(ix)entered into or varied or authorised or announced its intention to enter
into or vary any contract, transaction or commitment (whether in respect of
capital expenditure or otherwise) which is of a long termlong-term, onerous or
unusual nature or magnitude or which is or would (with the giving of notice,
lapsing of time or satisfaction of any conditions) be restrictive on any
business of any member of the Cybit Group or Bidco, or which involves or would
(with the giving of notice, lapsing of time or satisfaction of any condition)
involve an obligation of such a nature or magnitude other than to an extent
which is normal in the context of the business concerned;
(x)(other than by way of a solvent winding-up in respect of a member which is
dormant at the relevant time) taken any corporate action or had any legal
proceedings started or threatened against it for its winding-up, dissolution or
reorganisation or for the appointment of a receiver, administrative receiver,
administrator, 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;
(xi)waived, settled or compromised any claim other than in the ordinary course
of business which is material in the context of the Cybit Group taken as a
whole; or
(xii)entered into any contract, commitment, arrangement or agreement or passed
any resolution or made any offer (which remains open for acceptance) with
respect to, or announced any intention to effect, any of the transactions,
matters or events referred to in this condition;
(e)since 31 March 2009, and save as disclosed in Cybit's annual report and
accounts for the year ended 31 March 2009 or as publicly announced by Cybit (by
the delivery of an announcement to a Regulatory Information Service);
(i)no material adverse change having occurred in the business, assets,
financial or trading position or profits of any member or members of the Cybit
Group, to an extent which is material in the context of the Cybit Group taken as
a whole;
(ii)no litigation, arbitration proceedings, prosecution or other legal
proceedings to which any member of the Cybit Group is or may become a party
(whether as a claimant, defendant or otherwise) and no investigation by any
third party against or in respect of any member of the Cybit Group having been
instituted, announced or threatened by or against or remaining outstanding in
respect of any member of the Cybit Group which in any case would or might
reasonably be expected to materially adversely affect the Cybit Group taken as a
whole;
(iii)no contingent or other liabilities relating to any member of the Cybit
Group having arisen or been incurred which might reasonably be expected to have
a material adverse effect on the Cybit Group taken as a whole; and
(iv)no steps having been taken which are expected to result in the withdrawal,
cancellation or termination without replacement of any material licence held by
any member of the Cybit Group which is necessary for the proper carrying on of
its business and material in the context of the Cybit Group as a whole;
(f)Bidco not having discovered, save as disclosed in Cybit's annual report and
accounts for the year ended 31 March 2009 or as publicly announced by Cybit (by
the delivery of an announcement to a Regulatory Information Service):
(i)that any financial, business or other information concerning the Cybit Group
as contained in the information publicly disclosed at any time by or on behalf
of any member of the Cybit Group is materially misleading, contains a material
misrepresentation of fact or omits to state a fact necessary to make that
information not materially misleading; or
(ii)that any member of the Cybit Group or any partnership, company or other
entity in which any member of the Cybit Group has a significant economic
interest and which is not a subsidiary undertaking of Cybit is subject to any
notice or liability (contingent or otherwise) which is not disclosed in the
annual report and accounts of Cybit for the financial year ended 31 March 2009
and which was required to have been so disclosed; and
(g)the Implementation Agreement not having been terminated in accordance with
its terms.
1.3Subject to the requirements of the Panel, Bidco reserves the right to waive
all or any of the above Conditions in whole or in part, except the Conditions
contained in paragraph 1.1. The Scheme will not become effective and the
Acquisition will not proceed unless all the above Conditions are fulfilled or
(if capable of waiver) waived or, where appropriate, determined by Bidco to have
been satisfied and to remain satisfied prior to the Scheme being sanctioned by
the Court. Bidco shall be under no obligation to waive or treat as fulfilled any
of the Conditions contained in paragraph 1.2 by a date earlier than the date
specified above for the fulfilment thereof notwithstanding that the other
Conditions may at such earlier date have been waived or fulfilled and that there
are, at such earlier date, no circumstances indicating that any of the
Conditions may not be capable of fulfilment.
1.4The Acquisition will lapse and the Scheme will not proceed if the Acquisition
is referred by the Office of Fair Trading to the Competition Commission in the
United Kingdom before the date of the Court Meeting.
1.5If Bidco is required by the Panel to make an offer for Scheme Shares under
the provisions of Rule 9 of the Code, Bidco may make such alterations to the
above Conditions as are necessary to comply with the provisions of that Rule.
1.6The availability of the aforementioned offer 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 legal and regulatory requirements.
1.7The Acquisition is subject to any such further terms as may be required to
comply with the provisions of the Code.
1.8Bidco reserves the right to elect to implement the Acquisition by way of a
takeover offer. In such event, such offer will be implemented on the same terms
and conditions (subject to appropriate amendments, including (without
limitation) an acceptance condition set at 90 per cent. of the shares to which
the offer relates), so far as applicable, as those which would apply to the
Scheme.
1.9The Acquisition and the Scheme are governed by English law and are subject to
the jurisdiction of the Court. The rules contained in the Code, so far as they
are appropriate, apply to the Acquisition or the Scheme.
Appendix II
Sources of Information and Bases of Calculation
Unless otherwise stated, the following constitute the bases and sources of
information referred to in the Scheme and this Announcement:
1.Financial information relating to Cybit has been extracted or derived (without
material adjustment) from the audited financial statements of Cybit for the
financial year ended 31 March 2009.
2.The current market capitalisation of Cybit is calculated by reference to a
price of 36.0 pence per Cybit Share (being the Closing Price of an Cybit Share
on 9 December 2009, the last business day prior to the date of this
Announcement).
3.The fully diluted share capital of Cybit (being 30,433,405 Shares) is
calculated on the basis of 27,451,767 Cybit Shares in issue on 9 December 2009,
with a further maximum of 2,981,638 Shares under option.
4.All prices for Cybit Shares have been derived from the AIM Appendix of the
Daily Official List and represent the Closing Price on the relevant date or
dates.
Appendix III
Definitions of terms used
In this Announcement, the following words and expressions have the following
meanings, unless the context requires otherwise:
+-------------------------------------------------------------------------+------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------+
| "Acquisition" | the proposed acquisition of Cybit by Bidco; |
+-------------------------------------------------------------------------+------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------+
| "AIM" | AIM market, a market operated by the London Stock Exchange; |
+-------------------------------------------------------------------------+------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------+
| "AIM Rules" | AIM Rules for Companies, July 2005, as published by the London Stock Exchange, as amended and updated from time to time; |
+-------------------------------------------------------------------------+------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------+
| "Announcement" | the announcement of the Acquisition in accordance with Rule 2.5 of the Code dated 10 December 2009; |
+-------------------------------------------------------------------------+------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------+
| "Articles of Association" or "Cybit Articles" | the articles of association of Cybit from time to time; |
+-------------------------------------------------------------------------+------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------+
| "Bidco" | Cyberspace Bidco Limited, a company incorporated in England and Wales with registered number 07095782, and an indirect wholly-owned subsidiary of Francisco Partners II (Cayman), L.P., a Cayman Islands limited partnership with registered number MC-20086; |
+-------------------------------------------------------------------------+------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------+
| "Bidco Director" | the persons whose names is set out in paragraph 11 of this Announcement or, where the context so requires, the directors of Bidco from time to time; |
+-------------------------------------------------------------------------+------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------+
| "Business Day" | a day, other than a Saturday, Sunday, public holiday or bank holiday, on which banks are generally open for normal business in the City of London; |
+-------------------------------------------------------------------------+------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------+
| "Capital Reduction" | the proposed reduction of Cybit's ordinary share capital to be provided for by the Scheme; |
+-------------------------------------------------------------------------+------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------+
| "Cenkos" | Cenkos Securities plc, financial advisor to Cybit; |
+-------------------------------------------------------------------------+------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------+
| "Code" | The City Code on Takeovers and Mergers; |
+-------------------------------------------------------------------------+------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------+
| "Closing Price" | in respect of a Scheme Share on any particular day, the closing middle-market quotation thereof as derived from the AIM section of the Daily Official List on that day; |
+-------------------------------------------------------------------------+------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------+
| "Companies Act" | The Companies Act 2006 (as amended); |
+-------------------------------------------------------------------------+------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------+
| "Conditions" | the conditions to the implementation of the Scheme and the Acquisition, which are set out in Appendix I of this Announcement; |
+-------------------------------------------------------------------------+------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------+
| "Court" | the High Court of Justice in England and Wales; |
+-------------------------------------------------------------------------+------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------+
| "Court Hearings" | the First Court Hearing and/or the Second Court Hearing, as the context requires; |
+-------------------------------------------------------------------------+------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------+
| "Court Meeting(s)" | the meeting of the holders of Scheme Shares to be convened by order of the Court pursuant to section 907 of the Companies Act to consider and, if thought fit, approve the Scheme, including any adjournment thereof; |
+-------------------------------------------------------------------------+------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------+
| "Cybit" or "Company" | Cybit Holdings Plc, a company incorporated in England and Wales with registered number 04134307; |
+-------------------------------------------------------------------------+------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------+
| "Cybit Directors" or "Cybit Board" | the persons whose names are set out in paragraph 7 of this Announcement; |
+-------------------------------------------------------------------------+------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------+
| "Cybit Group" | the Company and its subsidiaries and subsidiary undertakings; |
+-------------------------------------------------------------------------+------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------+
| "Cybit Share Option Scheme(s)" | (i) the EMI Share Option Scheme adopted by a resolution of the Board of Directors on 2 August 2002, and (ii) the unapproved share option plans pursuant to which options to subscribe for Shares have been granted to or for the benefit of certain Cybit Directors; |
+-------------------------------------------------------------------------+------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------+
| "Daily Official List" | the daily official list of the London Stock Exchange; |
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| "dealing day" | a day on which dealings in domestic securities may take place on, and with the authority of the London Stock Exchange; |
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| | |
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| "Effective Date" | the date on which the Orders and a statement of capital (approved by the Court) shall have been delivered to the Registrar; |
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| "Financial Services Authority" or "FSA" | the Financial Services Authority of the United Kingdom; |
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| "Francisco Partners" | Francisco Partners II (Cayman), L.P., a Cayman Islands limited partnership with registered number MC-20086 and funds controlled by or under common control with it; |
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| "First Court Hearing" | the hearing by the Court of the claim form to sanction the Scheme; |
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| "General Meeting " | the general meeting of Cybit to be convened by notice set out in the Scheme Document; |
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| "FY2008" | Cybit's financial year ended 31 March 2008; |
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| "Implementation Agreement" | the implementation agreement entered into by Bidco, Francisco Partners II (Cayman), L.P. and the Company in connection with the Scheme; |
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| "Investec" | Investec Bank plc, financial adviser to Bidco; |
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| "latest practicable date prior to the publication of this Announcement" | 9 December 2009; |
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| "London Stock Exchange" | London Stock Exchange Plc; |
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| "Meetings" | the Court Meeting and the General Meeting, and "Meeting" shall be construed accordingly; |
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| "New Cybit Shares" | means the Shares proposed to be issued and credited as fully paid to Bidco and/or nominees; |
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| "Offer Period" | the period commencing on 10 December 2009 and ending on the Effective Date of the Scheme, or such other date as the Panel may decide; |
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| "Orders" | the order of the Court sanctioning the Scheme under section 897 of the Companies Act and the Reduction Order, and "Order" shall, where the context so requires, mean either of them; |
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| "Panel" | The Panel on Takeovers and Mergers; |
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| "Proposals" | the Scheme and the other matters to be considered at the Meetings; |
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| "Reduction Order" | the order of the Court confirming the reduction of ordinary share capital under section 648 of the Companies Act provided for by the Scheme; |
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| "Registrar" | The Registrar of Companies in England and Wales; |
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| "Regulatory Information Service" | a service approved by the London Stock Exchange for the distribution to the public of AIM announcements and included within the list maintained on the London Stock Exchange's website; |
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| "Scheme" or "Scheme of Arrangement" | the proposed scheme of arrangement under Part 26 of the Companies Act to effect the Acquisition between Cybit and holders of Scheme Shares with or subject to any modification, addition or condition approved or imposed by the Court; |
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| "Scheme Document" | the circular addressed to Cybit Shareholders to be posted on or about 15 December 2009 containing, among other things, the terms and conditions of the Scheme, certain information about Cybit and Bidco, the notices convening the Meetings and an explanatory statement in compliance with section 897 of the Companies Act; |
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| "Scheme Record Time" | 6:00 pm on the Business Day immediately preceding the date of the Second Court Hearing; |
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| "Scheme Shareholders" | holders of Scheme Shares, and "Scheme Shareholder" shall be construed accordingly; |
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| | |
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| "Scheme Shares" or "Cybit Shares" | the Shares (except those held by Bidco) in the capital of Cybit: |
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| | (i) |
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| | (ii) |
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| | (iii) |
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| "Second Court Hearing" | the hearing by the Court of the petition to confirm the reduction of Cybit's ordinary share capital under section 648 of the Companies Act provided for by the Scheme; |
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| "Senior Executive" | any employee of a Wider Cybit Group company being a chief executive offer of any company in the Wider Cybit Group other than Cybit itself and/or any person who reports directly to the chief executive offer of Cybit; |
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| "Shares" | ordinary shares of 5 pence each in the capital of Cybit, including, the Scheme Shares; |
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| "Special Resolution" | the Special Resolution to be proposed at the General Meeting in connection with, inter alia, the approval of the Scheme; |
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| "takeover offer" | as that phrase is defined in section 974 of the Act; |
+-------------------------------------------------------------------------+------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------+
| "Third Party" | any central bank, government, government department or governmental, quasi-governmental, supranational, statutory, regulatory or investigative body, authority (including any national anti-trust or merger control authority), trade agency, court, association, institution or professional or environmental body in any jurisdiction; |
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| "United Kingdom" or "UK" | the United Kingdom of Great Britain and Northern Ireland; |
+-------------------------------------------------------------------------+------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------+
| "Voting Record Time" | 6:00 pm on the day which is two days before the date of the Court Meeting or, if the Court Meeting is adjourned, 6:00 pm on the second day before the date of such adjourned meeting; |
+-------------------------------------------------------------------------+------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------+
| "$" | United States dollars, or the lawful currency of the United States from time to time; and |
+-------------------------------------------------------------------------+------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------+
| "GBP" or "pounds sterling" | pounds sterling, or the lawful currency of the UK from time to time |
+-------------------------------------------------------------------------+------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------+
In this Announcement, the expressions "subsidiary", "subsidiary undertaking",
"associated undertaking" and "undertaking" have the meanings given by the
Companies Act.
In this Announcement, the references to the singular includes the plural and
vice versa, unless the context otherwise requires. References to time are to
London time.
Appendix IV
1.The irrevocable undertakings received from Mr. Neil Johnson, Mr. Kevin
Lawrence, Mr. Richard Horsman and Mr. David Robins will cease to be binding if:
(a)Bidco has not announced a firm intention to make the Acquisition by 15
December 2009 or such later date as Cybit and Bidco may agree; or
(b)the Scheme is withdrawn, lapses or does not complete by 19 February 2010.
2.The undertakings received from Helium Special Situations and Brewin Dolphin
referred to in paragraph 7(B) of this announcement will cease to be binding if:
(a)Bidco has not announced a firm intention to make the Acquisition by 24
December 2010 or such later date as Cybit and Bidco may agree; or
(b)the Scheme Document is not posted to the shareholders of Cybit within 28
days (or such longer period as the Panel may agree) after the date of the
Announcement;
(c)prior to the Scheme becoming effective a person other than Bidco or a
subsidiary of Bidco or any person acting in concert with Bidco announces in
accordance with Rule 2.5 of the Code a firm intention to make a general offer
(whether recommended or not) to acquire the whole of the issued and to be issued
share capital of Cybit not already owned by such person (a "Third Party Offer"),
which Third Party Offer represents, in the reasonable opinion of Cybit's
financial advisor, an improvement of 10 per cent. per Ordinary Share on the
value of the consideration offered under the Scheme as at the date on which the
Third Party Offer is announced; and
(d)the Scheme does not become effective by 19 February 2010 or is withdrawn or
lapses.
3.The undertaking received from Pelham Olive referred to in paragraph 7(B) of
this announcement will cease to be binding if:
(a)Bidco has not announced a firm intention to make the Acquisition by 24
December 2010 or such later date as Cybit and Bidco may agree; or
(b)the Scheme Document is not posted to the shareholders of Cybit within 28
days (or such longer period as the Panel may agree) after the date of the
Announcement;
(c)prior to the Scheme becoming effective a person other than Bidco or a
subsidiary of Bidco or any person acting in concert with Bidco announces in
accordance with Rule 2.5 of the Code a firm intention to make a general offer
(whether recommended or not) to acquire the whole of the issued and to be issued
share capital of Cybit not already owned by such person (a "Third Party Offer"),
which Third Party Offer represents, in the reasonable opinion of Cybit's
financial advisor, an improvement of 5 per cent. per Ordinary Share on the value
of the consideration offered under the Scheme as at the date on which the Third
Party Offer is announced; and
(d)the Scheme does not become effective by 19 February 2010 or is withdrawn or
lapses.
4.The undertaking received from Legal & General Investment Management referred
to in paragraph 7(B) of this announcement will cease to be binding if:
(a)the Scheme Document is not posted to the shareholders of Cybit within 28
days (or such longer period as the Panel may agree) after the date of the
Announcement; and
(b)prior to the Scheme becoming effective a person other than Bidco or a
subsidiary of Bidco or any person acting in concert with Bidco announces in
accordance with Rule 2.5 of the Code a firm intention to make a general offer
(whether recommended or not) to acquire the whole of the issued and to be issued
share capital of Cybit not already owned by such person (a "Third Party Offer"),
which Third Party Offer represents, in the reasonable opinion of Cybit's
financial advisor, an improvement of 10 per cent. per Ordinary Share on the
value of the consideration offered under the Scheme as at the date on which the
Third Party Offer is announced.
This information is provided by RNS
The company news service from the London Stock Exchange
END
OUPGRBDDUSBGGCG
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