RNS No 4999p
FILOFAX GROUP PLC
25th September 1998
Part 1
Not for release, publication or distribution in or into Canada,
Australia or Japan
Day Runner UK plc
Revised and Recommended Offer
for
Filofax Group plc
Summary
Following a meeting between representatives of Day Runner UK and
Filofax last night, the Boards of Day Runner UK and Filofax
announce that they have agreed the terms of a Recommended Offer
for Filofax. The Recommended Offer is being made by Wasserstein
Perella on behalf of Day Runner UK, a wholly owned subsidiary of
Day Runner. Cazenove is broker to the Recommended Offer.
The Recommended Offer:
is 210 pence in cash for each Filofax Share
values the entire issued ordinary share capital of Filofax
at approximately #50.3 million
represents a premium of 50.0 per cent. over the closing
middle market price of 140 pence per Filofax Share on 23
September 1998, the day before Day Runner UK announced its
original offer terms
represents a multiple of 14.0x Filofax's 1998 earnings per
share, before the loss attributable to Henry Ling
Day Runner owns or has irrevocable undertakings to accept the
Recommended Offer in respect of 5,568,211 Filofax Shares
representing approximately 23.2 per cent. of the Filofax
issued share capital.
Commenting on the Recommended Offer, Robin Field, Chairman of
Filofax, said today:
"The Board of Filofax unanimously recommends Day Runner's offer,
which we believe fairly recognises the value which we have worked
so hard to build. The Filofax brand will be an excellent
complement to Day Runner's existing products and should provide a
significant opportunity for the international growth of the
enlarged business."
Mark Vidovich, Chairman of Day Runner added:
"I am delighted to have achieved this result. This is an
excellent acquisition for Day Runner. It brings us a valuable
European brand and creates a strong platform for our future
international growth."
Press Enquiries:
Day Runner:
Day Runner Mark Vidovich Tel: 0171 446 8000
Judy Tucker Tel: 0171 446 8000
Wasserstein Perella Howard Covington Tel: 0171 446 8000
Karen Dodd Tel: 0171 446 8000
Cazenove Julian Cazalet Tel: 0171 825 9350
Ed Byers Tel: 0171 825 9113
Brunswick James Bradley Tel: 0171 404 5959
Lucas van Praag Tel: 0171 404 5959
Filofax:
Filofax Robin Field Tel: 0171 432 3000
Rothschild Tony Allen Tel: 0171 280 5000
Hoare Govett Mark Astaire Tel: 0171 601 0101
Ludgate Terry Garrett Tel: 0171 253 2252
The Recommended Offer is not being made, directly or indirectly,
in or into, or by use of the mails of, or by any means or
instrumentality (including, without limitation, telephonically or
electronically) of interstate or foreign commerce of, or any
facilities of a national securities exchange of, Canada,
Australia or Japan and the Recommended Offer will not be capable
of acceptance by any such use, means, instrumentality or
facilities or from within Canada, Australia or Japan, except
pursuant to any applicable exemption.
The Loan Notes which may be issued pursuant to the Recommended
Offer have not been, and will not be, registered under the
Securities Act or under any of the relevant securities laws of
any State of the United States, Canada, Australia or Japan.
Accordingly, unless an exemption under the Securities Act or such
relevant securities laws is applicable, the Loan Notes may not be
offered, sold, resold, delivered or distributed, directly or
indirectly, in or into the United States, Canada, Australia or
Japan and will not be available to US Persons.
Wasserstein Perella, which is regulated in the UK by The
Securities and Futures Authority Limited, is acting for Day
Runner and Day Runner UK and no one else in connection with the
Recommended Offer and will not be responsible to anyone other
than Day Runner and Day Runner UK for providing the protections
afforded to customers of Wasserstein Perella nor for giving
advice in relation to the Recommended Offer.
Rothschild, which is regulated in the UK by The Securities and
Futures Authority Limited, is acting for Filofax and no one else
in connection with the Recommended Offer and will not be
responsible to anyone other than Filofax for providing the
protections afforded to customers of Rothschild nor for giving
advice in relation to the Recommended Offer.
This summary should be read in conjunction with the attached
announcement.
Not for release, publication or distribution in or into Canada,
Australia or Japan
Day Runner UK plc
Revised and Recommended Offer
for
Filofax Group plc
Introduction
Following a meeting between representatives of Day Runner UK and
Filofax last night, the Boards of Day Runner UK and Filofax
announce that they have agreed the terms of a Recommended Offer
for Filofax. The Recommended Offer is being made by Wasserstein
Perella on behalf of Day Runner UK, a wholly owned subsidiary of
Day Runner, for the entire issued and to be issued ordinary share
capital of Filofax not already owned by Day Runner UK. Cazenove
is broker to the Recommended Offer.
The Recommended Offer
The Recommended Offer is being made on the following basis:
for each Filofax Share 210 pence in cash
The Recommended Offer values Filofax's issued share capital at
approximately #50.3 million.
The Board of Filofax, which has been so advised by Rothschild,
considers the terms of the Recommended Offer to be fair and
reasonable. In providing advice to the Board of Filofax,
Rothschild has taken into account the commercial assessments of
the Directors of Filofax. Accordingly, the Directors of Filofax
unanimously recommend all shareholders to accept the Recommended
Offer as they intend to do in respect of their Filofax Shares.
The Directors of Filofax have given irrevocable undertakings to
accept the Recommended Offer in respect of 590,264 Filofax Shares
held by them, representing approximately 2.5 per cent. of Filofax
issued share capital.
The Recommended Offer represents a premium of 50.0 per cent. to
the closing middle market price of 140 pence per Filofax Share on
23 September 1998, the day before Day Runner UK announced its
original offer terms. It represents a multiple of 14.0x
Filofax's 1998 earnings per share, before the loss attributable
to Henry Ling.
The Recommended Offer will be subject to the conditions and on
the terms set out in Appendix I and on the further terms to be
set out in the Recommended Offer Document.
Filofax Shares will be acquired pursuant to the Recommended Offer
fully paid and free from all liens, equities, charges,
encumbrances and other interests and together with all rights now
or hereafter attaching thereto, including, without limitation,
the right to receive and retain all dividends and other
distributions announced, declared, made or paid after 31 March
1998. Filofax Shareholders on the register on 2 October 1998
will be entitled to receive and retain the final dividend of 2.42
pence per Filofax Share payable on 30 October 1998.
The Recommended Offer will extend to all existing issued Filofax
Shares and any Filofax Shares which are unconditionally allotted
or issued prior to the date on which the Recommended Offer closes
(or such earlier date not (without the consent of the Panel)
being earlier than the date on which the Recommended Offer
becomes or is declared unconditional as to acceptances or, if
later, the first closing date of the Recommended Offer, as Day
Runner UK may decide) as a result of the exercise of options
under the Filofax Share Schemes or otherwise.
Background to and reasons for the Recommended Offer
Day Runner is a logical international partner for Filofax. Day
Runner and Filofax are complementary both in geographical
coverage and in distribution channels. The combination of Day
Runner and Filofax will create a strong platform to develop the
Filofax brand.
Information on Day Runner UK
Day Runner UK is an indirect wholly owned subsidiary of Day
Runner, and has been established in order to implement the
Recommended Offer. To date, Day Runner UK has engaged in no
activities other than those incidental to its incorporation and
the making of the Recommended Offer.
Information on Day Runner
Day Runner markets personal organising products to broad-based
consumer audiences through retail distribution channels. It is
the leading producer of paper-based personal organisers for the
US retail market and also supplies a number of related organising
products. Day Runner is headquartered in Irvine, California. Its
shares are quoted on The Nasdaq Stock Market in the US (ticker
symbol "DAYR"), and it has a market capitalisation of
approximately US$ 229 million (#136 million).
In the year ended 30 June 1998, Day Runner reported audited
consolidated operating profit of US$25.6 million (#15.2 million)
on sales of US$167.8 million (#99.9 million). This represented
sales growth of 31.8 per cent. over the prior year. At 30 June
1998, Day Runner had shareholders' funds of US$74.5 million
(#44.4 million).
Information on Filofax
Filofax is a manufacturer and supplier of stationery products.
Filofax's core business is the supply of ring binder organisers
under the Filofax and Microfile brands. Other products include
time management systems, business forms and telephone message
pads and up-market writing instruments.
In the year ended 31 March 1998, Filofax's audited consolidated
turnover was #42.2 million (#37.7 million for continuing
operations) and operating profit was #4.3 million (#6.1 million
for continuing operations). Net assets at 31 March 1998 were
#10.5 million.
The Loan Note Alternative
Instead of some or all of the cash consideration which would
otherwise be receivable by them under the Recommended Offer,
Filofax Shareholders (other than certain overseas persons)
accepting the Recommended Offer will be entitled to elect to
receive Loan Notes on the following basis:
for each #1 of cash consideration
under the Recommended Offer #1 nominal of Loan Notes
The Loan Notes will be unsecured obligations of Day Runner UK and
will be issued, credited as fully paid, in amounts and integral
multiples of #1 nominal value; all fractional entitlements will
be disregarded and not paid. The Loan Notes will bear interest
(from the date of issue to the relevant holder of Loan Notes) at
a rate of 1.0 per cent. per annum below LIBOR. Interest on the
Loan Notes will be payable annually in arrears on 30 September
(or, if not a business day in any year, on the first business day
thereafter), commencing 30 September 1999. The Loan Notes will
be redeemable at the option of the holders on each interest
payment date from and including 30 September 1999 (or, if not a
business day, on the first business day thereafter ). Unless
previously redeemed or purchased, the Loan Notes will be redeemed
on 30 September 2003 or, if not a business day, on the first
business day thereafter. The Loan Notes will, subject to certain
conditions, be transferable but no application is intended to be
made for the Loan Notes to be listed, or dealt in, on any stock
exchange. Payment of principal of and interest on the Loan Notes
will be guaranteed by Day Runner. The Loan Notes have not been,
and will not be, registered under the Securities Act or under any
other securities laws and should not be offered, sold, resold,
delivered or distributed, directly or indirectly, in or into the
United States, Canada, Australia or Japan and will not be
available to US Persons (in any such case except in transactions
exempt from or not subject to the registration requirements of
the Securities Act or the relevant securities laws of any State
of the United States, Canada, Japan or Australia).
The Loan Note Alternative will be conditional on the Recommended
Offer becoming or being declared unconditional in all respects
and will remain open for so long as the Recommended Offer remains
open for acceptance. No Loan Notes will be issued unless, by the
time the Recommended Offer becomes or is declared wholly
unconditional, valid elections from accepting Filofax
Shareholders have been received for at least #5 million nominal
value of Loan Notes (or such lesser value as Day Runner UK may
decide). If insufficient elections are received, Filofax
Shareholders who validly elect for the Loan Note Alternative will
instead receive cash in accordance with the terms of the
Recommended Offer. Details of the principal terms of the Loan
Notes will be contained in the Recommended Offer Document.
Financing for the Recommended Offer
Day Runner will finance the Recommended Offer out of medium term
credit facilities which it has put in place both for this purpose
and to provide working capital for the Day Runner Group in
future.
Employees
The Board of Day Runner has confirmed that the existing
employment rights, including pension rights, of the employees of
Filofax will be fully safeguarded.
Filofax Share Schemes
The Recommended Offer extends to any Filofax Shares
unconditionally allotted or issued prior to the date on which the
Recommended Offer closes (or such earlier date as Day Runner UK
may determine) as a result of the exercise of options granted
under the Filofax Share Schemes. To the extent that such options
are not or cannot be exercised in full, it is intended that
appropriate proposals will be made to option holders under the
Filofax Shares Schemes in due course, once the Recommended Offer
has become unconditional in all respects.
Irrevocable Undertakings and Shareholdings
Day Runner UK has received irrevocable undertakings to accept the
Recommended Offer from the Directors and a former director of
Filofax and from certain members of their families and associated
interests in respect of holdings amounting, in aggregate, to
4,168,211 Filofax Shares representing approximately 17.4 per
cent. of the Filofax issued share capital. The irrevocable
undertakings extend to any further Filofax Shares acquired
hereafter including any Filofax Shares issuable on exercise of
share options granted under the Filofax Share Schemes and give no
right of withdrawal in the event that a higher offer is made.
Following the announcement of the original offer terms on 24
September 1998, Day Runner UK acquired 1.4 million Filofax Shares
by means of market purchases and now owns or has irrevocable
undertakings to accept the Recommended Offer in respect of
5,568,211 Filofax Shares representing approximately 23.2 per
cent. of the Filofax issued share capital.
Save as set out above, neither Day Runner nor Day Runner UK, nor
any of their respective directors nor, so far as Day Runner UK is
aware, any person acting in concert with Day Runner or Day Runner
UK, owns or controls any Filofax Shares or has any option to
acquire any Filofax Shares, or has entered into any derivative
referenced to securities of Filofax which remains outstanding.
General
The Recommended Offer Document, setting out details of the
Recommended Offer (including the Loan Note Alternative) and the
Form of Acceptance will be posted to Filofax Shareholders as soon
as practicable. The Recommended Offer will be open for at least
twenty business days from the date of the Recommended Offer
Document.
The availability of the Recommended Offer and any election
thereunder to persons outside the UK may be affected by the laws
of the relevant jurisdiction. Such persons should inform
themselves about and observe any applicable requirements.
This announcement does not constitute an offer or an invitation
to purchase any securities.
Certain terms used in this announcement are defined in Appendix
II.
Day Runner is a registered trademark.
Press Enquiries:
Day Runner:
Day Runner Mark Vidovich Tel: 0171 446 8000
Judy Tucker Tel: 0171 446 8000
Wasserstein Perella Howard Covington Tel: 0171 446 8000
Karen Dodd Tel: 0171 446 8000
Cazenove Julian Cazalet Tel: 0171 825 9350
Ed Byers Tel: 0171 825 9113
Brunswick James Bradley Tel: 0171 404 5959
Lucas van Praag Tel: 0171 404 5959
Filofax:
Filofax Robin Field Tel: 0171 432 3000
Rothschild Tony Allen Tel: 0171 280 5000
Hoare Govett Mark Astaire Tel: 0171 601 0101
Ludgate Terry Garrett Tel: 0171 253 2252
Wasserstein Perella, which is regulated in the UK by The
Securities and Futures Authority Limited, is acting for Day
Runner and Day Runner UK and no one else in connection with the
Recommended Offer and will not be responsible to anyone other
than Day Runner and Day Runner UK for providing the protections
afforded to customers of Wasserstein Perella nor for giving
advice in relation to the Recommended Offer.
Rothschild, which is regulated in the UK by The Securities and
Futures Authority Limited, is acting for Filofax and no one else
in connection with the Recommended Offer and will not be
responsible to anyone other than Filofax for providing the
protections afforded to customers of Rothschild nor for giving
advice in relation to the Recommended Offer.
The Recommended Offer is not being made, directly or indirectly,
in or into, or by use of the mails of, or by any means or
instrumentality (including, without limitation, telephonically or
electronically) of interstate or foreign commerce of, or any
facilities of a national securities exchange of, Canada,
Australia or Japan and the Recommended Offer will not be capable
of acceptance by any such use, means, instrumentality or
facilities or from within Canada, Australia or Japan except
pursuant to any applicable exemption.
The Loan Notes which may be issued pursuant to the Recommended
Offer have not been, and will not be, registered under the
Securities Act or under any of the relevant securities laws of
any State of the United States, Canada, Australia or Japan.
Accordingly, unless an exemption under the Securities Act or such
relevant securities laws is applicable, the Loan Notes may not be
offered, sold, resold, delivered or distributed, directly or
indirectly, in or into the United States, Canada, Australia or
Japan and will not be available to US Persons.
(MORE TO FOLLOW)
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