TIDMIEL TIDMIIPW TIDMIIP
RNS Number : 7931K
Indian Energy Limited
21 July 2011
THIS ANNOUNCEMENT IS 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 THAT JURISDICTION
21 July 2011
Recommended share offer for Indian Energy Limited ("IEL") by
Infrastructure India plc ("IIP")
The Boards of IEL and IIP announce that they have reached
agreement on the terms of a recommended share offer by IIP for the
entire issued and to be issued ordinary share capital of IEL. It is
intended that the Offer be implemented by way of a scheme of
arrangement under Part VIII of the Guernsey Companies Law.
Summary
-- The Offer will be made on the basis that, upon the Scheme
becoming effective, IEL Shareholders will receive 100 IIP Shares
for every 259 IEL Shares. No fractions of New IIP Shares will be
allotted.
-- The Offer values the whole of the currently issued and to be
issued share capital of IEL at approximately GBP7.9 million.
-- The Offer is based upon a value of 31 pence per IEL Share,
which:
(i) represents a premium for IEL Shareholders of 50.5 per cent.
based upon the average Closing Price of an IEL Share for the five
Dealing Days immediately prior to the commencement of the Offer
Period of 20.6 pence per IEL Share; and
(ii) represents a premium for IEL Shareholders of 21.6 per cent.
based upon the Closing Price of IEL on 20 July 2011, being the last
Dealing Day prior to the publication of this announcement, of 25.5
pence per IEL Share.
The Closing Price of an IIP Share on 20 July 2011, being the
last Dealing Day prior to this announcement, was 80.38 pence per
IIP Share.
The IEL Directors, who have been so advised by Arden Partners,
consider the terms of the Proposal to be fair and reasonable. In
providing advice to the IEL Directors, Arden Partners has taken
into account their commercial assessments.
The IEL Directors intend to recommend unanimously that IEL
Shareholders vote in favour of both the Scheme Resolution to be
proposed at the Court Meeting and the Utilico Resolution to be
proposed at the EGM, as they have irrevocably undertaken (without
the scope for this obligation to fall away in the face of a
competing offer) to do in respect of, in aggregate, 1,742,519 IEL
Shares in which they are interested, representing approximately
6.83 per cent. of the existing issued share capital of IEL.
-- IIP has also received an irrevocable undertaking from Utilico
to vote in favour of the Scheme Resolution to be proposed at the
Court Meeting in respect of 5,197,792IEL Shares, representing
approximately 20.38 per cent. of the existing issued share capital
of IEL. Utilico will not vote on the Utilico Resolution as a result
of its interest in the Utilico Loan Conversion.
-- Accordingly, in total, IIP has received irrevocable
undertakings to vote in favour of the Scheme Resolution in respect
of 6,940,311 IEL Shares representing approximately 27.21 per cent.
of the existing issued share capital of IEL.
Commenting on the Proposal, John Wallinger, Chairman of IEL,
said:
"We are delighted with the announcement of the Offer today,
which is the result of an intensive process undertaken by IEL to
secure the future of the business and deliver the best value for
shareholders. The Offer will give Indian Energy's shareholders an
interest in a larger, more diversified portfolio in the fast
growing Indian infrastructure segment through IIP. We believe that
this Offer will result in a significantly enhanced offering for our
shareholders and an opportunity to strengthen the business through
the scale, reputation and resources of IIP."
Commenting on the Proposal, Tom Tribone, Chairman of IIP,
said:
"We are pleased to be acquiring IEL as it increases our exposure
to the rapidly growing Indian renewable energy market. IEL has
built a strong portfolio of assets together with a solid
operational platform from which to leverage. We look forward to
working with IEL's accomplished team and providing the necessary
support to realise the full potential of the IEL business."
The Offer will be implemented by way of a scheme of arrangement
under Part VIII of the Guernsey Companies Law and, in order to
approve the terms of the Offer, IEL Shareholders will need to vote
in favour of the Scheme Resolution to be proposed at the Court
Meeting. At the Court Meeting, the approval of a majority in number
of those IEL Shareholders voting (in person or by proxy),
representing at least 75 per cent. in value of the IEL Shares in
respect of which votes are cast (either in person or by proxy) will
be required. Once the necessary approval has been obtained, the
Scheme will become effective upon sanction by the Court of the
Scheme and satisfaction (or waiver, where possible) of the
Conditions.
It is a condition of the Offer that IEL Shareholders, other than
Utilico vote by a simple majority in favour of the Utilico
Resolution to be proposed at the EGM (either in person or by
proxy). If it is not passed, then the Offer will, with the consent
of the Panel, lapse and the Scheme will not proceed.
An indicative timetable of principal events is set out below.
Please note that these dates are indicative only and will depend,
among other things, on the date upon which the Court hears the
application to convene the Court Meeting and the date on which the
Court sanctions the Scheme.
Event Time and/or date
First Court hearing (to convene 9 August 2011
Court Meeting)
Scheme Document sent to IEL Shareholders by 12 August 2011
Court Meeting and EGM 2 September 2011
Suspension of trading of IEL Shares 7.00 a.m. on 20
on AIM September 2011
Second Court hearing (to sanction 20 September 2011
the Scheme)
Admission of New IIP Shares to 8.00 a.m. on 21
trading on AIM and cancellation September 2011
of trading of IEL Shares on AIM
Fairfax is acting as financial adviser to IIP and Arden Partners
is acting as financial adviser to IEL.
This summary should be read in conjunction with the accompanying
full text of the announcement which sets out further details of the
Proposal and which forms an integral part of this announcement. The
Offer will be subject to the Conditions set out in Appendix A.
Appendix B contains details of the bases and sources of certain
information used in this summary and the following announcement.
Appendix C contains details of irrevocable commitments obtained by
IIP. Appendix D contains definitions of certain expressions used in
this summary and the following announcement.
In accordance with Rule 19.11 of the Code, a copy of this
announcement will be published on the following websites:
www.indian-energy.com and www.iiplc.com
For the avoidance of doubt, the content of the websites referred
to above is not incorporated into and does not form part of this
announcement.
Enquiries:
Indian Energy Limited Tel: +44 20 3411
3640
Rupert Strachwitz
Arden Partners Plc (Financial adviser, broker Tel: +44 20 7614
and Nomad to IEL) 5917
Chris Hardie / Jamie Cameron
Pelham Bell Pottinger (Public Relations to IEL) Tel: +44 20 7861
3232
Clare Gilbey
Infrastructure India plc Tel: via Redleaf
Polhill
Sonny Lulla
Fairfax I.S. PLC (Financial Adviser to IIP) Tel: +44 20 7598
5368
Simon Stevens
Smith & Williamson Corporate Finance Limited Tel: +44 20 7131
(Nomad and joint broker to IIP) 4000
Azhic Basirov / Siobhan Sergeant
Westhouse Securities Limited (Joint Broker to Tel: +44 20 7601
IIP) 6100
Alastair Moreton / Hannah Young
Redleaf Polhill (Public Relations to IIP) Tel: +44 20 7566
6720
Samantha Robbins / Luis Mackness
Fairfax, which is authorised and regulated in the United Kingdom
by the FSA, is acting exclusively for IIP and no one else in
connection with the Proposal and will not be responsible to anyone
other than IIP for providing the protections afforded to clients of
Fairfax nor for providing advice in relation to the Proposal, the
contents of this announcement, or any transaction or arrangement
referenced in this announcement.
Arden Partners, which is authorised and regulated in the United
Kingdom by the FSA, is acting exclusively for IEL and no one else
in connection with the Proposal and will not be responsible to
anyone other than IEL for providing the protections afforded to
customers of Arden Partners nor for providing advice in relation to
the Proposal, the contents of this announcement, or any transaction
or arrangement referenced in this announcement.
This announcement is not intended to and does not constitute or
form any part of, an offer to sell or an invitation to purchase or
the solicitation of an offer to subscribe for any securities or the
solicitation of any vote or approval in any jurisdiction pursuant
to the Offer or otherwise, nor shall there be any purchase, sale or
exchange of securities or such solicitation in any jurisdiction in
which such offer, solicitation or sale or exchange would be
unlawful prior to registration or qualification under the laws of
such jurisdiction.
This announcement does not constitute a prospectus or a
prospectus equivalent document.
The Offer will be made solely through the Scheme Document which
will contain the full terms and conditions of the Scheme, including
details of how to vote in favour of the Scheme Resolution and the
Utilico Resolution. IEL will prepare the Scheme Document to be
distributed to IEL Shareholders. IEL and IIP urge IEL Shareholders
to read the Scheme Document when it becomes available because it
will contain important information relating to the Offer. Any
response to the Offer should be made only on the basis of the
information contained in the Scheme Document.
This announcement has been prepared for the purpose of complying
with Guernsey law and the Code and the information disclosed may
not be the same as that which would have been disclosed if this
announcement had been prepared in accordance with the laws of
jurisdictions outside Guernsey.
The distribution of this announcement in jurisdictions other
than the United Kingdom may be restricted by the laws of those
jurisdictions and therefore persons into whose possession this
announcement comes should inform themselves about, and observe any
such restrictions. Failure to comply with any such restrictions may
constitute a violation of the securities laws of any such
jurisdiction.
Unless otherwise determined by IIP and/or IEL, or required by
the Code and permitted by applicable law and regulation, the Offer
is not being, and will not be made, directly or indirectly, in or
into or by the use of the mails of, or by any other means
(including, without limitation, electronic mail, facsimile
transmission, telex, telephone, internet or other forms of
electronic communication) of interstate or foreign commerce of, or
any facility of a national securities exchange of any Restricted
Territory and will not be capable of acceptance by any such use,
means or facility or from within any such Restricted Territory.
Accordingly, unless otherwise determined by IIP and/or IEL, copies
of this announcement and any other documentation relating to the
Offer are not being, and must not be, directly or indirectly,
mailed or otherwise forwarded, distributed or sent in or into or
from any Restricted Territory and persons receiving such documents
(including custodians, nominees and trustees) must not mail or
otherwise forward, distribute or send any such documents in or into
or from any such Restricted Territory. Any person (including,
without limitation, custodians, nominees and trustees) who would,
or otherwise intends to, or who may have a contractual or legal
obligation to, forward this announcement and/or any other related
document to any jurisdiction outside the United Kingdom should
inform themselves of, and observe, any applicable legal or
regulatory requirements of any relevant jurisdiction. Neither the
SEC nor any US state securities commission has approved or
disapproved the Offer or passed upon the adequacy or completeness
of this announcement or any other documentation relating to the
Offer. Any representation to the contrary is a criminal
offence.
This announcement does not constitute an offer to buy or to
subscribe for, or the solicitation of an offer to buy or subscribe
for, shares in any jurisdiction in which such offer or solicitation
is unlawful. In particular, the New IIP Shares have not been, and
will not be, registered under the US Securities Act or qualified
for sale under the laws of any state of the United States or under
the applicable laws of any of the Restricted Territories and,
subject to certain exceptions, may not be offered or sold in the
United States or to, or for the account or benefit of any national,
resident or citizen of a Restricted Territory. Neither this
announcement nor any copy of it may be distributed directly or
indirectly to any persons with addresses in the Restricted
Territories, or to any corporation, partnership or other entity
created or organised under the laws thereof, or in any other
country outside the United Kingdom or Guernsey where such
distribution may lead to a breach of any legal or regulatory
requirement. This announcement has been prepared for the purposes
of complying with Guernsey law, the AIM Rules and the City Code and
the information disclosed may not be the same as that which would
have been prepared in accordance with the laws and regulations of
any jurisdiction outside Guernsey.
FORWARD LOOKING STATEMENTS
This announcement contains certain forward-looking statements
with respect to the financial condition, results of operations and
business of IEL and/or IIP and certain plans and objectives of the
board of directors of IEL, and IIP with respect thereto. These
forward-looking statements can be identified by the fact that they
do not relate only 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
IEL and IIP in the light of their experience and their perception
of historical trends, current conditions, expected future
developments and other factors they believe appropriate. They have
not been reviewed by the auditors of IEL or IIP. 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.
All subsequent oral or written forward-looking statements
attributable to IEL or IIP or any of their respective members,
directors, officers or employees or any persons acting on their
behalf are expressly qualified in their entirety by the cautionary
statement above. All forward-looking statements included in this
announcement are based on information available to IEL and IIP on
the date of this announcement and are made only as of the date of
this announcement. Undue reliance should not be placed on such
forward-looking statements.
Subject to compliance with the Code, neither IEL nor IIP intend,
or undertake any obligation, to update any information contained in
this announcement.
DEALING DISCLOSURE REQUIREMENTS
Under Rule 8.3(a) of the Code, any person who is interested in
1% or more of any class of relevant securities of an offeree
company or of any paper offeror (being any offeror other than an
offeror in respect of which it has been announced that its offer
is, or is likely to be, solely in cash) must make an Opening
Position Disclosure following the commencement of the Offer Period
and, if later, following the announcement in which any paper
offeror is first identified.
An Opening Position Disclosure must contain details of the
person's interests and short positions in, and rights to subscribe
for, any relevant securities of each of (i) the offeree company and
(ii) any paper offeror(s). An Opening Position Disclosure by a
person to whom Rule 8.3(a) applies must be made by no later than
3.30 p.m. (London time) on the 10th business day following the
commencement of the Offer Period and, if appropriate, by no later
than 3.30 pm (London time) on the 10th business day following the
announcement in which any paper offeror is first identified.
Relevant persons who deal in the relevant securities of the offeree
company or of a paper offeror prior to the deadline for making an
Opening Position Disclosure must instead make a Dealing
Disclosure.
Under Rule 8.3(b) of the Code, any person who is, or becomes,
interested in 1% or more of any class of relevant securities of the
offeree company or of any paper offeror must make a Dealing
Disclosure if the person deals in any relevant securities of the
offeree company or of any paper offeror. A Dealing Disclosure must
contain details of the dealing concerned and of the person's
interests and short positions in, and rights to subscribe for, any
relevant securities of each of (i) the offeree company and (ii) any
paper offeror, save to the extent that these details have
previously been disclosed under Rule 8. A Dealing Disclosure by a
person to whom Rule 8.3(b) applies must be made by no later than
3.30 p.m. (London time) on the business day following the date of
the relevant dealing.
If two or more persons act together pursuant to an agreement or
understanding, whether formal or informal, to acquire or control an
interest in relevant securities of an offeree company or a paper
offeror, they will be deemed to be a single person for the purpose
of Rule 8.3.
Opening Position Disclosures must also be made by the offeree
company and by any offeror and Dealing Disclosures must also be
made by the offeree company, by any offeror and by any persons
acting in concert with any of them (see Rules 8.1, 8.2 and
8.4).
Details of the offeree and offeror companies in respect of whose
relevant securities Opening Position Disclosures and Dealing
Disclosures must be made can be found in the Disclosure Table on
the Takeover Panel's website at www.thetakeoverpanel.org.uk,
including details of the number of relevant securities in issue,
when the Offer Period commenced and when any offeror was first
identified. If you are in any doubt as to whether you are required
to make an Opening Position Disclosure or a Dealing Disclosure, you
should contact the Panel's Market Surveillance Unit on +44 (0)20
7638 0129.
PUBLICATION ON WEBSITE
A copy of this announcement will be made available on both IEL's
and IIP's websites at www.indian-energy.com and www.iiplc.com
respectively, on 21 July2011.
For the avoidance of doubt, the content of the websites referred
to above is not incorporated into and does not form part of this
announcement.
THIS ANNOUNCEMENT IS NOT FOR RELEASE, PUBLICATION OR
DISTRIBUTION, IN WHOLE OR IN PART, IN OR INTO ANY JURISDICTION
WHERE TO DO SO WOULD CONSTITUTE A VIOLATION OF THE RELEVANT LAWS OF
SUCH JURISDICTION.
RECOMMENDED SHARE OFFER
for
the entire issued and to be issued share capital of Indian
Energy Limited
by
Infrastructure India plc
1. Introduction
The Boards of IEL and IIP announce that they have agreed the
terms of a recommended offer for the acquisition by IIP of the
entire issued and to be issued share capital of IEL. The Offer is
to be effected by way of a scheme of arrangement under Part VIII of
the Guernsey Companies Law, which requires approval by IEL
Shareholders and sanction of the Court.
This announcement sets out the background to, and the key terms
of, the Offer and the reasons why the IEL Directors consider the
Proposal to be fair and reasonable and intend to recommend
unanimously that IEL Shareholders vote in favour of the resolution
to be proposed at the Court Meeting required to implement the
Scheme and the resolution to be proposed at the EGM to approve the
Utilico Loan Conversion, as they have irrevocably undertaken to do
in respect of their beneficial holdings totalling 1,742,519 IEL
Shares, representing, in aggregate, 6.83 per cent. of the existing
issued share capital of IEL.
In order to approve the Offer, IEL Shareholders will be required
to vote in favour of both the Scheme Resolution to be proposed at
the Court Meeting and the Utilico Resolution to be proposed at the
EGM, both of which meetings are expected to be held on 2
September2011. It is anticipated that the Scheme Document
containing a notice of the Court Meeting and a notice of the EGM
will be sent to IEL Shareholders by 12 August2011 following a
hearing of the Court application to convene the Court Meeting.
2. The Offer
The Offer is to be effected by way of a scheme of arrangement of
IEL under Part VIII of the Guernsey Companies Law. The purpose of
the Scheme is to enable IIP to acquire the whole of the issued and
to be issued share capital of IEL. Under the terms of the Scheme,
the IEL Shares will be transferred to IIP and, upon the Scheme
becoming effective, IEL Shareholders will receive:
for every 259 IEL Shares - 100 New IIP Shares
On the basis of the price of 80.38 pence for each IIP Share,
being the closing price on 20 July 2011, the last Dealing Day prior
to this announcement, this values each IEL Share at 31 pence and
the entire issued share capital of IEL at approximately GBP7.9
million.
The Offer is based upon a value of 31 pence per IEL Share,
which:
i. represents a premium to the IEL Shareholders of 50.5 per
cent. based upon the average Closing Price of an IEL Share for the
five Dealing Days immediately prior to the commencement of the
Offer Period of 20.6 pence per IEL Share; and
ii. represents a premium to the IEL Shareholders of 21.6 per
cent. based upon the Closing Price of an IEL Share on 21 July 2011,
being the last Dealing Day immediately prior to this announcement,
of 25.5 pence per IEL Share.
The Closing Price of an IIP Share on 20 July 2011, being the
last Dealing Day immediately prior to this announcement, was 80.38
pence per IIP Share.
IEL Shareholders should note that the value of the Consideration
that they will ultimately receive (once the Scheme is implemented
and becomes effective in accordance with its terms) will depend
upon the market value of New IIP Shares received by them on the
settlement date, and this value may vary.
The New IIP Shares will be issued credited as fully paid, on
identical terms to and will rank pari passu with the existing
issued IIP Shares, including the right to receive and retain all
dividends and other distributions declared, paid or made after the
Scheme becomes effective. Fractions of New IIP Shares will not be
allotted or issued to IEL Shareholders pursuant to the Offer.
Application will be made to the London Stock Exchange for the
New IIP Shares to be admitted to trading on AIM following the
Scheme becoming effective. It is expected that Admission will
become effective and that trading in the New IIP Shares will
commence on AIM on 21 September 2011.
If the Scheme becomes effective, IEL will become a wholly owned
subsidiary of IIP on the Effective Date and the IEL Shareholders
will receive the Consideration referred to above.
Fully diluted Enlarged IIP Share Capital
Completion of the Offer will result in the issue of up to 13.2
million New IIP Shares, including the estimated number issued upon
conversion of the Utilico Loan, by IIP, representing 8.07 per cent.
of the Enlarged IIP Share Capital. Subject to the issue of IIP
Shares to AHPL (as defined and set out below), the number of IIP
Shares in issue and to be issued on a fully diluted basis will be
approximately 163.7 million (assuming no other issues of IIP Shares
take place prior to the Effective Date).
On 3 March 2011, IIP announced that it had agreed to acquire
almost all of the outstanding balance of the shares in Vikram
Logistic & Maritime Services Private Limited ("VLMS")
(approximately 62.6%) from Anuradha Holdings Private Limited
("AHPL"), subject to certain conditions (including the approval of
India's Foreign Investment Promotion Board (the "FIPB")). IIP was
notified, following a meeting of the FIPB held on 20 May 2011, that
AHPL's application to sell its VLMS shares to IIP via a share swap
had been rejected. The FIPB has been requested to reconsider its
decision and this is currently anticipated to be determined in
August 2011.
Another key condition to acquiring the VLMS shares held by AHPL
is the acquisition of the 105 acres of land in Bangalore and the
105 acres of land in Chennai. The IIP Directors expect that this
land acquisition will be completed in the third calendar quarter of
2011.
Assuming that the relevant conditions are met and the shares
held by AHPL in VLMS are acquired by IIP, IIP will be obliged to
issue approximately 55 million IIP Shares to AHPL. If these IIP
Shares are issued prior to the Effective Date, this will result in
the number of IIP Shares in issue and to be issued on a fully
diluted basis (as referred to above) being approximately 218.8
million.
3. Utilico Loan
Utilico is an approximately 20.4 per cent. shareholder in IEL as
well as an approximately 5.9 per cent. shareholder in IIP. In July
2010, Utilico provided the Utilico Loan to IEL, initially for GBP2
million but this was increased to GBP2.5 million in December 2010.
The interest and fees attached to the Utilico Loan are rolled up
with the capital amount and are due on repayment which is due on 31
January 2012. The interest rate on the Utilico Loan is currently
12.5 per cent. and there is no entitlement on the part of IEL to
make early repayment. As part of the arrangements for the facility,
Utilico was granted warrants over 3.4 million IEL Shares at an
exercise price of 70 pence. No offer is being made for these
warrants which will be cancelled upon the Scheme becoming
effective.
In conjunction with the Offer, IIP intends to redeem the Utilico
Loan by the issue to Utilico of IIP Shares equal to the value of
all amounts outstanding under the Utilico Loan at the time that the
Scheme becomes effective, based on the terms of the Offer at the
date of this announcement. The Directors estimate that the amount
outstanding under the Utilico Loan on 20 September 2011 will be
approximately GBP2.7 million including fees and interest accrued up
to that date. This will be converted into IIP Shares on the basis
of the Closing Price for an IIP Share of 80.38 pence at 20 July
2011 (which is the price used in the formula for the Offer for IEL
Shares). As a result of this conversion, approximately 3.3 million
new IIP Shares will be issued representing approximately 2 per
cent. of the Enlarged IIP Share Capital (based on an approximate
amount of GBP2.7 million outstanding on conversion).
Since Utilico is a significant shareholder in IEL, a vote of
independent shareholders in IEL at a shareholder meeting is
required for the purposes of Rule 16 of the Code to approve the
Utilico Loan Conversion. Accordingly, the IEL Board intends to
convene the EGM to be held immediately following the Court Meeting
on 2 September 2011 at which a resolution will be put before
independent shareholders of IEL to approve the Utilico Loan
Conversion. A notice of the EGM will be included with the Scheme
Document along with a form of proxy to enable IEL shareholders
(other than Utilico) to vote on the Utilico Resolution. Utilico
will not vote on this resolution as a result of its interest in the
Utilico Loan Conversion.
IEL Shareholders should be aware that it will be a non-waivable
condition of the Offer that the Utilico Resolution is passed. If
the Utilico Resolution is not passed then the Offer will, with the
consent of the Panel, lapse and the Scheme will not proceed.
4. Recommendation
The IEL Directors, who have been so advised by Arden Partners,
consider the terms of the Proposal to be fair and reasonable. In
providing its advice, Arden Partners has taken into account the
commercial assessments of the IEL Directors. The IEL Directors
intend to recommend unanimously that IEL Shareholders vote in
favour of both the Scheme Resolution to be proposed at the Court
Meeting and the Utilico Resolution to be proposed at the EGM, as
they have irrevocably undertaken to do so in respect of their own
shareholdings.
5. Irrevocable undertakings to vote in favour of the Scheme
Resolution and Utilico Resolution
Irrevocable undertakings to vote in favour of the Scheme
Resolution to be put to the Court Meeting have been received by IIP
in respect of a total of approximately 27.21 per cent. of the
existing share capital of IEL. Details of those irrevocable
undertakings are as follows:
(a) the IEL Directors, who hold interests in IEL Shares
amounting, in aggregate, to 1,742,519 shares (representing
approximately 6.83 per cent. of the existing issued share capital
of IEL), have irrevocably undertaken to vote in favour of the
Scheme Resolution to be put to the Court Meeting in respect of
their entire legal and beneficial holdings; and
(b) Utilico, which holds 5,197,792 IEL Shares (representing
approximately 20.38 per cent. of the entire issued share capital of
IEL), has irrevocably undertaken to vote in favour of the Scheme
Resolution to be proposed at the Court Meeting in respect of its
holdings at the Voting Record Time.
Irrevocable undertakings to vote in favour of the Utilico
Resolution to be put to the Extraordinary General Meeting in
respect of their entire legal and beneficial holdings have been
received by IIP from the IEL Directors, who hold interests in IEL
Shares amounting, in aggregate, to 1,742,519 shares (representing
approximately 6.83 per cent. of the existing issued share capital
of IEL).
Further details of the irrevocable undertakings are set out in
Part I of Appendix C of this announcement.
6. Background to and reasons for recommending the Proposal
IEL came to the market in September 2009 and raised GBP9.75
million (gross). This allowed IEL to commit to the 16.5 MW wind
farm project at Theni in Tamil Nadu, although achieving the initial
target of building a portfolio of wind farms with 300 MW of annual
generating capacity was always dependant on IEL's ability to raise
further capital.
In the event, IEL sought to raise further funds in early 2010
and later in that year; both attempts to raise funding were
unsuccessful notwithstanding that IEL had successfully implemented
its strategy at Theni and created a pipeline of transactions for
the future. In particular, this was reflected in the option signed
with Suzlon Energy for the construction of a 50.4 MW wind farm at
Tejuva in the State of Rajasthan, as announced on 15 October 2010,
and various memoranda of understanding for a range of projects
entered into with Suzlon Energy and Regen Powertech, both
manufacturers of wind turbines and developers of wind projects.
Following these attempts to raise further equity from
institutional shareholders, the Board began to consider alternative
funding structures, particularly with strategic investment
partners. Given the size of IEL and the necessary capital
requirements, these were likely to result in a change of control of
IEL. In December 2010, IEL was approached by a third party
regarding a possible offer while discussions with potential funders
were still continuing. As a result, the Board decided that a
process should be conducted to determine whether an offer for IEL
could be obtained while it was still considering funding options.
This was referred to in the announcement of its interim results on
23 December 2010. In the event, IEL entered into exclusivity with a
party but this was not concluded. The Board approached IIP in March
2011 to investigate whether IEL could become part of a larger scale
infrastructure group backed by a substantial investor in the form
of Guggenheim Global Infrastructure Company Limited, a company
which owns and operates energy and transportation infrastructure
investments.
The Board believes that IEL cannot achieve its objectives as an
independent company without substantial further investment. It
believes that wind energy remains an attractive area for investment
and that IIP has the necessary resources to allow IEL to achieve
its goals. The offer of shares in IIP enables investors to continue
to benefit from their investment while being part of a group with
investments in, among others, hydro-electric power and toll road
projects which are, in some cases, already operating and generating
cash flow. IIP has a market capitalisation in excess of GBP120
million.
While this will effectively dilute the "pure" wind objectives of
IEL, the Board feels that shareholders' interests will be well
served by voting in favour of the Offer and taking a broader
investment position in Indian infrastructure businesses which the
Board believes will grow strongly over many years. The IEL
Shareholders will also become shareholders in a larger and more
financially secure entity.
7. Current Trading and Prospects of IEL
IEL has today announced its preliminary results for the year
ended 31 March 2011. The results show a 55 per cent. increase in
revenues to GBP3.43 million (2010 - GBP2.21 million) and a
reduction in losses after tax to GBP2.85 million (2010 - GBP3.4
million).
During the financial year, the Theni Project was fully
commissioned in August 2010 and therefore missed the bulk of the
monsoon season. From a technical perspective the project has
performed overall within budget in terms of machine availability
and transmission losses. IEL also achieved a reduction in the
project finance costs with the interest spread having been reduced
by 1 per cent. to 3.75 per cent. over base rate.
The coming year will see both the Gadag and Theni projects
operating at full capacity and the early signs indicate that the
2011 monsoon will revert to or exceed the mean. This should result
in improved generation at both sites. With the costs reductions
achieved, IEL's aim is to be cash flow break-even at a P75
generation level.
8. Information on IIP
IIP was registered and incorporated in the Isle of Man on 18
March 2008. It is a closed-ended investment company admitted to AIM
with an investment objective to provide shareholders with capital
growth and income by investing in assets in the Indian
infrastructure sector, with particular focus on assets and projects
related to energy and transport.
IIP invests predominantly in those infrastructure projects in
India which it believes have the potential to generate substantial
capital growth and deliver income. IIP will seek to recover all
investments within three to five years of the date of investment.
However, if a project is performing well and continuing to create
sufficient value, the Board of IIP may decide that it is
appropriate to hold an investment in that business for a longer
period of time to realise maximum value of its interests. The IIP
Directors believe that this strategy is well structured to enable
IIP to progress in the current market conditions.
The majority of the Indian infrastructure deals which IIP is
focused on are typically not large, high profile deals, but are
private, less competitive and circulated to a much smaller group of
infrastructure players active in the market. IIP will invest those
cash resources which are held by IIP in cash or near cash deposits
unless they are deployed in infrastructure projects or used to fund
IIP's working capital requirements.
IIP aims to invest in assets that are expected to generate a
base IRR of 15 per cent. per annum. The IIP Directors believe that
the IIP Group's returns could be raised to 25 per cent. due to
additional potential gains from refinancing, yield compression
effects and portfolio management efficiencies, similar to the
returns that have been achieved by other listed infrastructure
companies.
As IIP's investments move from a development phase into an
operating phase, cash flows will develop and should be adequate to
pay and maintain a dividend. It is the aim of the IIP Directors
that the IIP dividend comes to be regarded as a key part of the
overall IIP investment return. The IIP Directors would not consider
it prudent to pay an uncovered dividend and the ability to maintain
a year-on-year progressive dividend policy will depend upon the
funding requirements of investments in IIP's portfolio and the
investment plans and commitments of the portfolio.
By acquiring IEL, should the Scheme become effective IIP will
further diversify its investment portfolio with exposure to the
wind energy market in India, with the additional opportunities for
both income generation and capital growth. IEL is a revenue
generating business, with revenue of GBP3.43 million in the year
ended 31 March 2011 and ongoing revenue generation could assist the
IIP Directors in determining a dividend in the future. Based on the
Net Asset Values announced today by IEL and IIP, IIP's net asset
value per share is expected to increase from 91.6 pence to 92.2
pence upon completion.
9. Current Trading and Prospects of IIP
The IIP assets continued to perform well during the financial
year ended 31 March 2011, with an overall increase in value of
approximately 27 per cent. Following the completion of the placings
in July 2010 and February 2011 and the acquisition of assets of
Guggenheim Global Infrastructure Company Limited in March 2011, the
NAV of IIP grew from GBP40.1 million to GBP138.0 million during the
financial year, representing an increase of 244 per cent. NAV per
share as at 31 March 2011 was GBP0.92 (at 31 March: 2010: GBP1.09),
a decrease of 16 per cent. This fall in NAV is as a result of the
dilutive effect of the two placings. Third party expenses of GBP3.1
million were in total virtually unchanged from the prior year, and
were incurred in connection with the corporate activities
undertaken by IIP over the course of the year.
Available cash resources are intended to be deployed in projects
which build upon IIP's existing investment portfolio, with a
continued focus on businesses providing basic infrastructure
services in the energy and transport sectors, and those which are
close to commencement of operations. Such businesses would
typically be expected to commence operations within 30 months.
IIP will look to deploy available capital as soon as possible
subject to the availability of suitable investments. Infrastructure
projects generally demonstrate an ability to create sustainable
long-term value for shareholders and such creation should be
readily apparent in India given its needs and expected growth.
Early deployment of capital should produce further progression in
IIP's NAV during the current financial year.
10. Management and employees
IIP envisages keeping IEL's employee base intact, drawing upon
the experience of IEL's executive management team to drive forward
the execution of its current strategy. However, conditional upon
the Scheme becoming effective, John Wallinger, Martyn
Henley-Roussel, James Smith and Dr. Pankaj Agarwal will resign as
non-executive directors of IEL with immediate effect. No
termination payments will be made to the non-executive directors of
IEL in connection with their resignations.
Details of the interests of the IEL Directors in the share
capital of IEL are set out in Part 1 of, Appendix C of this
announcement. IEL Shares held by the IEL Directors will be subject
to the Scheme.
The effect of the Offer on the interests of the IEL Directors
will not differ from its effect on the interests of any other IEL
Shareholder.
11. Implementation Agreement
IEL and IIP entered into an implementation agreement on 20 July
2011, which sets out certain mutual commitments intended to
facilitate the implementation of the Scheme and certain matters
relating to the conduct of the business of the IEL Group pending
the Scheme becoming effective.
12. IEL Warrants and Options
No offer is being extended in respect of the IEL Warrants or the
IEL Options as their exercise price has been (and is, prior to the
posting of this announcement) substantially higher than the IEL
Share price as evidenced by the Closing Prices of the IEL Shares
shown in Part 3 of Appendix C of this announcement.
13. Confirmation regarding Opening Position Disclosure
IIP and IEL each confirms that it will, on the date of this
announcement make an Opening Position Disclosure, which discloses
the details required to be disclosed by it under Rule 8.1(a) and
Rule 8.2(a) of the Code respectively.
14. Structure of the Offer
The Offer is to be effected by way of a scheme of arrangement
between IEL and the IEL Shareholders under Part VIII of the
Guernsey Companies Law. If the Scheme becomes effective, it will
result in IEL becoming a wholly owned direct subsidiary of IIP. IIP
will issue and allot the relevant number of New IIP Shares to the
IEL Shareholders on the register at the Scheme Record Time.
It is proposed that under the Scheme all the IEL Shares in issue
prior to the Voting Record Time will be transferred to IIP. Any
further IEL Shares issued before the Scheme Record Time, if the IEL
Shareholders are or have consented to be bound by the Scheme, will
also be transferred to IIP.
IEL Shareholders who are on the register of members of IEL at
the Scheme Record Time will receive New IIP Shares on the basis set
out in paragraph 2 above. Shares in IEL issued after the Scheme
Record Time will not be subject to the Scheme.
It is expected that the Scheme will become effective by the
close of business on 21 September 2011. The Scheme can only become
effective if all the conditions to which the Scheme is subject have
been satisfied or, if capable of waiver, waived by no later than 30
November 2011 or such later date, if any, as IEL and IIP may agree
and the Court may allow.
The Conditions to the Scheme are set out in full in Appendix A
of this announcement. In summary, the implementation of the Scheme
is conditional, inter alia, upon:
1. the approval of the Scheme Resolution at the Court Meeting by
IEL Shareholders;
2. the approval of the Utilico Resolution at the Extraordinary
General Meeting by IEL Shareholders (other than Utilico);
3. the Court Sanction being obtained; and
4. the admission of the New IIP Shares to trading on AIM.
It is expected that the Scheme Document, setting out full
details of the Proposal and the Scheme, together with the notices
of the Court Meeting and the EGM and the related forms of proxy,
will be despatched to IEL Shareholders by 12 August 2011 following
the hearing of the application in Court to convene the Court
Meeting.
15. Court Meeting and Court Sanction
Before the Court's sanction can be sought for the Scheme, the
Scheme will require approval by the IEL Shareholders at the Court
Meeting which is being held at the direction of the Court to seek
approval of IEL Shareholders of the Scheme.
Court Meeting
It is expected that the Court Meeting will be convened on 2
September 2011 at 4th Floor, West Wing, Trafalgar Court, Admiral
Park, St Peter Port, Guernsey GY1 3RL to enable IEL Shareholders to
consider and, if thought fit, approve the Scheme. At the Court
Meeting, voting will be by poll and not a show of hands and each
IEL Shareholder who is present in person or by proxy will be
entitled to one vote for each IEL Share held. The approval required
by the Court Meeting is that those voting to approve the Scheme
must:
1. represent a majority in number of those IEL Shareholders
present and voting in person or by proxy; and
2. also represent 75 per cent. in value of the IEL Shares held
by those IEL Shareholders present and voting in person or by proxy
at the Court Meeting.
It is important that as many votes as possible are cast at the
Court Meeting (whether in person or by proxy) so that the Court may
be satisfied that there is a fair representation of IEL Shareholder
opinion.
IEL Shareholders' entitlement to attend and vote at the Court
Meeting and the number of votes which may be cast at each meeting
will be determined by reference to the register of members of IEL
at the Voting Record Time, including any adjournment thereto.
Court Sanction
Under the Guernsey Companies Law, the Scheme requires the
sanction of the Court. The hearing by the Court to sanction the
Scheme is currently expected to be held on 20 September 2011,
subject to the prior satisfaction or (where capable of waiver)
waiver of the Conditions set out in Appendix A of this
announcement. IIP has confirmed that it will be represented by
counsel at such hearing so as to consent to the Scheme and to
undertake to the Court to be bound thereby.
If the Court sanctions the Scheme and it becomes effective, it
will be binding on all IEL Shareholders irrespective of whether or
not they attended or voted in favour of the Scheme at the Court
Meeting. If the Scheme does not become effective by 30 November
2011 (or such later day if any as IEL and IIP may agree with, where
applicable the consent of the Panel and (if required) where the
Court may allow), the Scheme will not proceed and the Offer will
lapse.
All IEL Shareholders are entitled to attend the Court Hearing in
person or to be represented at their own expense by counsel to
support or oppose the sanctioning of the Scheme.
Modifications to the Scheme
The Scheme will contain a provision for IEL and IIP jointly to
consent (on behalf of all persons affected) to any modification of,
or addition to, the Scheme or to any condition approved or imposed
by the Court. The Court would be unlikely to approve any
modification of, or additions to, or impose a condition to the
Scheme which would be material to the interests of the IEL
Shareholders unless the IEL Shareholders were informed of any such
modification, addition or condition. It would be a matter for the
Court to decide, in its discretion, whether or not a further
meeting of the IEL Shareholders should be held in these
circumstances. Similarly, if a modification, addition or condition
is put forward which, in the opinion of the IEL Directors, is of
such a nature or importance that it requires the consent of IEL
Shareholders, the IEL Directors will not take the necessary steps
to enable the Scheme to become effective unless and until such
consent is obtained.
Alternative means of implementing the Offer
IIP has reserved the right to elect (with the consent of the
Panel where necessary) to implement the Offer by way of a takeover
offer, in which case additional documents will be despatched to IEL
Shareholders. In such event, such a takeover offer will (unless
otherwise agreed) be implemented on the same terms as far as
applicable as those which would apply to the Scheme (subject to
appropriate amendments including (without limitation) an acceptance
condition of 90 per cent. (or such lesser percentage, being more
than 50 per cent. as IIP may decide) of the shares to which the
offer relates).
Furthermore, if sufficient acceptances of such takeover offer
are received and/or sufficient IEL Shares are otherwise acquired,
it is the intention of IIP to apply the provisions of Part XVIII of
the Guernsey Companies Law to acquire compulsorily any outstanding
IEL Shares to which such takeover offer relates.
16. Extraordinary General Meeting
It is expected that the Extraordinary General Meeting will be
convened on 2 September 2011 immediately following the Court
Meeting at 4(th) Floor, West Wing, Trafalgar Court, Admiral Park,
St Peter Port, Guernsey G1Y 3RL to enable IEL Shareholders (other
than Utilico) to consider and, if thought fit, to approve the
Utilico Resolution. At the Extraordinary General Meeting a simple
majority of shareholders voting (either in person or in proxy) will
be required to approve the Utilico Resolution. IEL Shareholders'
entitlement to attend and vote at the Extraordinary General Meeting
and the number of votes which may be cast at such meeting will be
determined by reference to the register of members of IEL at the
Voting Record Time including any adjournment thereto.
17. Admission of New IIP Shares to trading on AIM
Application will be made to the London Stock Exchange for the
New IIP Shares to be admitted to trading on AIM. It is expected
that Admission will become effective and that dealings on AIM (for
normal settlement) will commence at 8.00 a.m. on 21 September 2011,
the first Dealing Day after the Effective Date.
No application is being made for the New IIP Shares to be
admitted to listing, or to be dealt in, on any exchange other than
AIM.
Temporary documents of title will not be issued pending the
dispatch, where applicable, by post of definitive certificates for
New IIP Shares in accordance with the terms of the Scheme. Pending
the issue of definitive certificates for the New IIP Shares,
transfers will be certified against the register held by the
Registrars.
18. Cancellation of admission of IEL Shares to trading on
AIM
Application will be made to the London Stock Exchange for IEL
Shares to be suspended from trading on AIM with effect from 7.00
a.m. on the day of the Court Hearing and no transfers of IEL Shares
will be registered after this time. Prior to the Effective Date, an
application will be made to the London Stock Exchange for the
cancellation, subject to the Scheme becoming effective, of the IEL
Shares, to admission to trading on AIM. If the Scheme becomes
effective based on the expected timetable, the last day of trading
in IEL Shares on the London Stock Exchange will be 19 September
2011 (being the Dealing Day immediately prior to the Hearing
Date).
19. Overseas Shareholders
The implications of the Proposal for Overseas Shareholders may
be affected by the laws of the relevant jurisdiction. Overseas
Shareholders should inform themselves about and observe any
applicable requirements. It is the responsibility of each Overseas
Shareholder to satisfy himself as to the full observance of the
laws of the relevant jurisdiction in connection therewith,
including the obtaining of any governmental, exchange control or
other consents which may be required, or the compliance with other
necessary formalities which are required to be observed and the
payment of any issue, transfer or other taxes due to such
jurisdiction.
Further details in relation to Overseas Shareholders will be
contained in the Scheme Document. IEL Shareholders who are in any
doubt regarding such matters should consult an appropriate
independent professional adviser in the relevant jurisdiction
without delay.
20. General
Your attention is drawn to the further information contained in
the Appendices which form part of this announcement.
A summary of the Conditions to implementation of the Offer set
out in Appendix A to this announcement form part of, and should be
read in conjunction with, this announcement.
Appendix B to this announcement provides details of the bases of
calculations and sources of certain information included in this
announcement.
Appendix C to this announcement contains details of the
irrevocable undertakings received in relation to the Proposal
together with other information required to be included in a Rule
2.5 announcement.
Appendix D to this announcement contains definitions of certain
terms used in this announcement.
Appendix A
Conditions to Implementation of the Offer
1. The Offer is conditional upon the Scheme becoming
unconditional and becoming effective by not later than 30 November
2011 or such later date (if any) as IEL and IIP may agree and the
Court may allow.
2. The Offer is conditional upon:
a) the approval of the Scheme Resolution by a majority in number
representing 75 per cent. or more in value of the holders of IEL
Shares (together with persons held to be in the same class), or the
relevant classes thereof, if applicable, (excluding any shares held
as treasury shares) present and voting, either in person or by
proxy, at the Court Meeting or at any adjournment of any such
meeting and at any separate class meeting, if applicable, which may
be required by the Court (or at any adjournment of such
meeting);
b) the approval of the Utilico Resolution by a majority in
number of the holders of IEL Shares present and voting, either in
person or by proxy, at the EGM or at any adjournment of any such
meeting;
c) the Court Sanction being obtained (with or without
modifications, but subject to any such modifications being on terms
acceptable to IEL and IIP); and
d) the Admission of the New IIP Shares to trading on AIM in
accordance with the AIM Rules or (if IIP so determines and subject
to the consent of the Panel) the London Stock Exchange agreeing to
admit such shares to trading on AIM subject only to the allotment
of such shares.
3. IEL and IIP have agreed that, subject as stated in paragraph
4 below, the Court Sanction will only be sought if the following
conditions are satisfied or waived:
a) Authorisations
i) all authorisations in any jurisdiction necessary for or in
respect of the Offer, its implementation or any acquisition of any
shares in, or control of, IEL or any other member of the Wider IEL
Group by any member of the Wider IIP Group having been obtained in
terms and in a form satisfactory to IIP (acting reasonably) from
any relevant person or from any person or body with whom any member
of the Wider IEL Group has entered into contractual arrangements
and all such authorisations remaining in full force and effect and
there being no intimation of any intention to revoke or not renew
the same at the time when the Offer becomes otherwise
unconditional;
ii) all authorisations necessary to carry on the business of any
member of the Wider IEL Group remaining in full force and effect
and there being no notification of any intention to revoke or not
to renew the same; and
iii) all necessary filings having been made and all applicable
waiting and other periods having expired, lapsed or been terminated
and all applicable statutory or regulatory obligations in any
jurisdiction in respect of the Offer having been complied with.
b) Regulatory intervention
No relevant person having taken, instituted, implemented or
threatened any legal proceedings, or having required any action to
be taken or otherwise having done anything or having enacted, made
or proposed any statute, regulation, order or decision or taken any
other step and there not continuing to be outstanding any statute,
regulation, order or decision that would or might reasonably be
expected to (in each case to an extent which is material and
adverse in the context of the Wider IEL Group):
i) make the Offer, its implementation or the acquisition or
proposed acquisition of any shares in, or control or management of,
the Wider IEL Group by IIP illegal, void or unenforceable;
ii) otherwise directly or indirectly prevent, prohibit or
otherwise restrict, restrain, delay or interfere with the
implementation of, or impose additional conditions or obligations
with respect to or otherwise challenge or require amendment of, the
Offer or the proposed acquisition of IEL by IIP or any acquisition
of shares in IEL by IIP;
iii) refer the Scheme (or any matter arising from it) to the
Competition Commission (including a reference to the Commerce
Commission following a referral by the European Commission under
Article 9.1 of Council Regulation 139/2004/EC to a competent
authority in the United Kingdom);
iv) cause the European Commission to initiate proceedings under
Article 6(1)(c) of Council Regulation 139/2004/EC;
v) require, prevent or delay the divestiture by IIP of any
shares or other securities in IEL;
vi) impose any limitation on the ability of any member of the
Wider IIP Group or any member of the Wider IEL Group to acquire or
hold or exercise effectively, directly or indirectly, any rights of
ownership of shares or other securities or the equivalent in any
member of the Wider IEL Group or management control over any member
of the Wider IEL Group;
vii) require, prevent or delay the disposal by IIP or any member
of the Wider IIP Group, or require the disposal or alter the terms
of any proposed disposal by any member of the Wider IEL Group, of
all or any part of their respective businesses, assets or
properties or impose any limitation on the ability of any of them
to conduct their respective businesses or own their respective
assets or properties;
viii) (save as required pursuant to the Offer) require any
member of the Wider IIP Group or of the Wider IEL Group to offer to
acquire any shares or other securities (or the equivalent) in any
member of the Wider IEL Group owned by any third party (in each
case, other than in implementation of the Offer);
ix) impose any limitation on the ability of any member of the
Wider IIP Group or the Wider IEL Group to integrate or co-ordinate
its business, or any part of it, with the businesses or any part of
the businesses of any other member of the Wider IIP Group and/or
the Wider IEL Group;
x) result in any member of the Wider IIP Group or the Wider IEL
Group ceasing to be able to carry on business under any name under
which it presently does so; or
xi) otherwise materially and adversely affect any or all of the
businesses, assets or financial condition of any member of the
Wider IIP Group or the Wider IEL Group;
and all applicable waiting and other time periods during which
any such relevant person could institute or implement or threaten
any legal proceedings having expired, lapsed or been
terminated.
c) Consequences of the Offer
Save as Disclosed, there being no provision of any agreement to
which any member of the Wider IEL Group is a party, or by or to
which any such member, or any part of its assets, may be bound,
entitled or subject, which as a consequence of the Offer or of the
acquisition or proposed acquisition of all or any part of the
issued share capital of, or change of control or management of, IEL
or any other member of the IEL Group would or could reasonably be
expected to result in (in each case to an extent which is material
and adverse in the context of the Wider IEL Group):
i) any material assets or interests of any member of the Wider
IEL Group being or falling to be disposed of or charged (otherwise
than in the ordinary course of business) in any way or ceasing to
be available to any member of the Wider IEL Group or any rights
arising under which any such asset or interest could be required to
be disposed of or charged in any way or could cease to be available
to any member of the Wider IEL Group;
ii) any monies borrowed by, or other indebtedness (actual or
contingent) of, or any grant available to, any member of the Wider
IEL Group being or becoming repayable or capable of being declared
repayable immediately or earlier than the repayment date stated in
such agreement or the ability of such member of the Wider IEL Group
to incur any such borrowing or indebtedness becoming or being
capable of becoming withdrawn, inhibited or prohibited;
iii) any such agreement or the rights, liabilities, obligations
or interests of any such member under it being or becoming capable
of being terminated or materially and adversely modified or
affected or any onerous obligation arising or any material adverse
action being taken under it;
iv) the interests or business of any such member in or with any
third party (or any arrangements relating to any such interests or
business) being terminated or becoming capable of being terminated
or adversely modified or affected;
v) the financial or trading position or prospects or value of
any member of the Wider IEL Group being materially prejudiced or
materially adversely affected;
vi) the creation of any mortgage, charge or other security
interest over the whole or any part of the business, property or
assets of any member of the Wider IEL Group or any such security
(whenever arising or having arisen) becoming enforceable or being
enforced;
vii) the creation of actual or contingent liabilities by any
member of the Wider IEL Group; or
viii) the ability of any member of the IEL Group to carry on its
business being materially and adversely affected,
and no event having occurred which, under any provision of any
such agreement or arrangement to which any member of the Wider IEL
Group is a party, or by or to which any such member, or any of its
assets, may be bound, entitled or subject, could result in any of
the events or circumstances as are referred to in sub-paragraphs
(i) to (viii) inclusive.
d) No corporate action taken since the Accounting Date
Since the Accounting Date, save as otherwise Disclosed or
pursuant to transactions in favour of IEL or a wholly-owned
subsidiary of IEL, no member of the Wider IEL Group having:
i) issued or agreed to issue or authorised or proposed the issue
or grant of additional shares of any class or securities
convertible into or exchangeable for, or rights, warrants or
options to subscribe for or acquire, any such shares or convertible
securities (save pursuant to the issue of IEL Shares on the
exercise of the IEL Warrants or the IEL Options);
ii) redeemed, purchased, repaid or reduced or announced the
redemption, purchase, repayment or reduction of any part of its
share capital or made or announced the making of any other change
to its share capital;
iii) recommended, declared, paid or made or proposed to
recommend, declare, pay or make any dividend, bonus issue or other
distribution whether payable in cash or otherwise other than
dividends lawfully paid to IEL or wholly owned subsidiaries of
IEL;
iv) (save for transactions between two or more wholly owned
members of the IEL Group) merged or demerged with or from, or
acquired, any body corporate or authorised or proposed or announced
any intention to propose any such merger or demerger;
v) other than in the ordinary course of business acquired or
disposed of, transferred, mortgaged or charged, or created or
granted any security interest over, any material assets (including
shares and trade investments) or authorised or proposed or
announced any intention to propose any acquisition, disposal,
transfer, mortgage, charge or creation or grant of any security
interest;
vi) (save for transactions between two or more wholly owned
members of the IEL Group) issued or authorised or proposed the
issue of any debentures or incurred or, otherwise than in the
ordinary course of business, increased borrowings, indebtedness or
liability (actual or contingent);
vii) entered into or varied, or announced its intention to enter
into or vary, any transaction, arrangement, contract or commitment
(whether in respect of capital expenditure or otherwise) which is
material and of a long term, onerous or unusual nature or magnitude
or which is restrictive to the existing business of any member of
the Wider IEL Group or which is not in the ordinary course of
business;
viii) (save for transactions between two or more wholly owned
members of the IEL Group) entered into, implemented, effected,
authorised or proposed or announced its intention to enter into,
implement, effect, authorise or propose any material contract,
reconstruction, amalgamation, scheme, commitment or other
transaction or arrangement otherwise than in the ordinary course of
business;
ix) waived or compromised any material claim;
x) entered into or varied or made any offer (which remains open
for acceptance) to enter into or vary to any material extent the
terms of any material contract with any of the directors or senior
executives of IEL or any of the directors or senior executives of
any other member of the Wider IEL Group;
xi) taken or proposed any corporate action or had any legal
proceedings instituted or threatened against it or petition
presented for its winding-up (voluntary or otherwise), dissolution
or reorganisation or for the appointment of a receiver,
administrator, administrative receiver, trustee or similar officer
of all or any of its assets and revenues or for any analogous
proceedings or steps in any jurisdiction or for the appointment of
any analogous person in any jurisdiction other than where any
proceedings have been presented:
(A) by a creditor, which are being contested in good faith and
with diligence and are discharged within 14 days; or
(B) in the context of a solvent reconstruction of any member of
the Wider IEL Group;
xii) been unable, or admitted in writing that it is unable, to
pay its debts or has stopped or suspended (or threatened to stop or
suspend) payment of its debts generally or ceased or threatened to
cease carrying on all or a substantial part of its business;
xiii) made any material alteration to its memorandum or articles
of association, or other incorporation documents; or
xiv) entered into any agreement or passed any resolution or made
any offer (which remains open for acceptance) or proposed or
announced any intention with respect to any of the transactions,
matters or events referred to in this condition 3(d).
e) Other events since the Accounting Date
In the period since the Accounting Date, save as Disclosed:
i) no litigation or arbitration proceedings, prosecution,
investigation or other legal proceedings having been announced,
instituted, threatened or remaining outstanding by, against or in
respect of, any member of the Wider IEL Group or to which any
member of the Wider IEL Group is or may become a party (whether as
claimant, defendant or otherwise) which in any case, would be
reasonably likely to have a material adverse effect on the
financial position of the Wider IEL Group;
ii) no material adverse change or deterioration having occurred
in the business or assets or financial or trading position, assets,
or profits of any member of the Wider IEL Group which in each such
case is material in the context of the Wider IEL Group taken as a
whole;
iii) no enquiry or investigation by, or complaint or reference
to, any relevant person against or in respect of any member of the
Wider IEL Group having been threatened, announced, implemented or
instituted or remaining outstanding by, against or in respect of,
any member of the Wider IEL Group which, in any case, would be
reasonably likely to have a material adverse effect on the
financial position of the Wider IEL Group; or
iv) no contingent or other liability having arisen or become
apparent or increased which, in any case, would be reasonably
likely to have a material adverse effect on the financial position
of the Wider IEL Group.
f) Other issues
Save as Disclosed, IIP not having discovered that (in each case
to an extent which is material and adverse in the context of the
Wider IEL Group):
i) the financial, business or other information disclosed at any
time by any member of the Wider IEL Group, whether publicly or in
the context of the Offer either contained a material
misrepresentation of fact which has not, prior to the Announcement
Date, been corrected by public announcement through a Regulatory
Information Service or omitted to state a fact necessary to make
the information disclosed not misleading in any material respect
and where such misrepresentation or omission is material and
adverse in the context of the Wider IEL Group as a whole;
ii) any contingent liability disclosed in such disclosed
information would or might materially and adversely affect,
directly or indirectly, the business or profits of the Wider IEL
Group taken as a whole;
iii) any information disclosed at any time by or on behalf of
any member of the Wider IEL Group is or becomes incorrect in any
material respect;
iv) there has been a disposal, spillage or leakage of waste or
hazardous substance or any substance likely to impair the
environment or harm human health on, or there has been an emission
or discharge of any waste or hazardous substance or any substance
likely to impair the environment or harm human health from, any
land or other asset now or previously owned, occupied or made use
of by any past or present member of the Wider IEL Group which in
each case would be reasonably likely to give rise to any liability
(whether actual or contingent, civil or criminal) or cost on the
part of any member of the Wider IEL Group; or
v) any past or present member of the Wider IEL Group has failed
to comply with any and/or all applicable legislation or regulations
of any relevant jurisdiction with regard to the use, treatment,
handling, storage, transport, disposal, spillage, release,
discharge, leak or emission of any waste or hazardous substance or
any substance reasonably likely to impair the environment or harm
human health or animal health or otherwise relating to
environmental matters, or that there has otherwise been any such
use, treatment, handling, storage, transport, disposal, spillage,
release, discharge, leak or emission (whether or not it constituted
a non-compliance by any member of the Wider IEL Group with any such
legislation or regulations, and wherever the same may have taken
place) any of which use, treatment, handling, storage, transport,
disposal, spillage, release, discharge, leak or emission would be
reasonably likely to give rise to any liability (actual or
contingent, civil or criminal) or cost on the part of any member of
the Wider IEL Group.
4. General
a) IIP reserves the right to waive all or any of the conditions
contained in paragraphs 3(a) to 3(f) above inclusive, in whole or
in part.
b) IIP shall be under no obligation to waive or treat as
fulfilled any of the conditions in paragraph 3 of this Appendix A
earlier than the date of the Court Sanction of the Scheme
notwithstanding that the other conditions of the Offer may at such
earlier date have been waived or fulfilled and that there are at
such earlier date no circumstances indicating that any of such
conditions may not be capable of fulfilment or waiver.
c) If IIP is required by the Panel to make an offer for IEL
Shares under the provisions of Rule 9 of the City Code, IIP may
make such alterations to the conditions as may be necessary to
comply with the provisions of that Rule.
d) The Offer will be governed by the laws of the Island of
Guernsey and is subject to the jurisdiction of the courts of the
Island of Guernsey. The rules of the City Code and the Court will,
so far as they are appropriate, apply to the Offer.
Appendix B
Sources and Basis of Information
In this announcement, unless otherwise stated or the context
otherwise requires, the following bases and sources have been
used:
(a) historical share prices are sourced from Daily Official List
and represent closing prices for IEL Shares and IIP Shares,
respectively, on the relevant date;
(b) the value of the whole of the existing issued and to be
issued share capital of IEL is based upon the entire issued share
capital at the date of this announcement, namely 25,508,980 IEL
Shares;
(c) unless otherwise stated, the financial information
concerning IEL and IIP has been extracted from the preliminary
announcement of IEL is unaudited results for the year ended 31
March 2011 or the audited results of IIP for the same period;
and
(d) references to a percentage of IEL Shares are based on the
number of IEL Shares in issue as set out at paragraph (b).
Appendix C
Part I - Details of irrevocable undertakings
1. IEL Directors
As at 20 July 2011 (being the last Dealing Day prior to the date
of this announcement) irrevocable undertakings to vote in favour of
the Scheme Resolution to be proposed in connection with the
Proposal have been given by the IEL Directors in respect of the
following numbers of IEL Shares in which they and certain persons
connected with them are interested:
Percentage
Total No. of issued
Name of IEL Shares share capital
John Wallinger 166,774 0.65
Rupert Strachwitz 755,642 2.96
Shantanu Bagchi 0 0
Dr. Pankaj Agarwal 730,587 2.86
Martyn Henley-Roussel 89,516 0.35
James Smith 0 0
The irrevocable undertakings referred to above shall continue to
apply if a third party announces an offer to acquire the entire
issued ordinary share capital of IIP on terms which are more
favourable to the IEL Directors than the terms of the Offer.
2. Other IEL Shareholders
As at 20 July 2011 (being the last Dealing Day prior to the date
of this document), irrevocable undertakings to vote in favour of
the Scheme Resolution to be proposed in connection with the
Proposal have been given by IEL Shareholders other than the IEL
Directors as follows:
Percentage
Total No. of issued
Name of IEL Shares share capital
Utilico Emerging Markets Ltd 5,197,792 20.38
The irrevocable undertaking granted by Utilico will cease to be
binding if a competing cash offer is announced for the whole of the
issued and to be issued share capital of IEL Shares which values an
IEL Share at more than a 10 per cent. premium to the price per IEL
Share payable under the then current Offer, unless within
twenty-one days of the offer document relating to such other
competing offer being published, IIP announces a revised price per
share payable under the Offer which is no less favourable than such
competing offer.
Part 2 - Directors and registered offices
a) The IEL Directors and their respective roles are:
Name Role
John Wallinger Non-Executive Chairman
Rupert Strachwitz Chief Executive Officer
Shantanu Bagchi Chief Operating Officer
Dr. Pankaj Agarwal Non-Executive Director
Martyn Henley-Roussel Non-Executive Director
James Smith Non-Executive Director
b) The registered office of IEL is 4th Floor, West Wing,
Trafalgar Court, Admiral Park, St Peter Port, Guernsey GY1 3RL.
c) The IIP Directors and their respective roles are:
Name Role
Tom Tribone Chairman
Rupert Cottrell Non-Executive Deputy Chairman
Sonny Lulla Chief Executive
Tim Stocks Non-Executive Director
Robert Venerus Non-Executive Director
Tim Walker Non-Executive Director
d) The registered office of IIP is IOMA House, Hope Street,
Douglas, Isle of Man IM1 1AP.
Part 3 - Market quotations
a) The following table shows the Closing Prices of IEL Shares
and IIP Shares for the first dealing day of each of the six months
immediately prior to the date of this announcement, for 22 December
2010 (being the date immediately before the commencement of the
Offer Period) and for 20 July 2011 (being the last Dealing Day
prior to the date of this announcement):
IEL Closing
Price per Share IIP Closing Price
Date (pence) per Share (pence)
22 December 2010 20.50 62.50
1 February 2011 19.00 67.00
1 March 2011 30.75 80.50
1 April 2011 27.75 79.00
3 May 2011 28.25 82.50
1 June 2011 28.125 82.50
1 July 2011 24.00 80.00
20 July 2011 25.50 80.38
Appendix D
Definitions
The following definitions apply throughout this announcement,
unless the context requires otherwise:
"Accounting Date" 31 March 2011.
"Admission" Admission of the New IIP Shares to trading on
AIM becoming effective in accordance with the
AIM Rules.
"AIM" A market operated by the London Stock Exchange.
"AIM Rules" Rules published by the London Stock Exchange
governing, inter alia, admission to AIM and
the continuing obligations of companies admitted
to AIM, as amended from time to time.
"Annual Report" The report and accounts of IEL for the period
ended on the Accounting Date.
"Arden Partners" Arden Partners plc, IEL's financial adviser,
broker and nominated adviser, authorised and
regulated by the FSA and incorporated in England
with company registration number 4427253.
"Authorisations" Authorisations, orders, recognitions, grants,
consents, licences, confirmations, clearances,
permissions and approvals.
"Board" Board of IIP or the board of IEL as the context
requires.
"Business Day" A day, other than a Saturday or Sunday or public
holiday of the United Kingdom or Guernsey, when
the clearing banks in the City of London are
open for business.
"Closing Price" Middle market quotation of one IEL Share and/or
of one IIP Share as the context requires as
derived from the Daily Official List.
"Code" or "City City Code on Takeovers and Mergers as from time
Code" to time interpreted by the Panel.
"Conditions" Conditions to the implementation of theOffer
(including the Scheme) set out in Appendix A
of this announcement.
"Consideration" New IIP Shares to be issued to IEL Shareholders
pursuant to the Scheme.
"Court" Royal Court of Guernsey.
"Court Hearing" Hearing by the Court of the petition to sanction
the Scheme.
"Court Meeting" Meeting of IEL Shareholders convened by order of
the Court pursuant to section 107 of the Guernsey
Companies Law to consider and, if thought fit,
approve the Scheme, including any adjournment
thereof.
"Court Order" Order of the Court sanctioning the Scheme under
section 110 of the Guernsey Companies Law.
"Court Sanction" Sanction (with or without modification) of the
Scheme by the Court.
"Daily Official Daily Official List of the London Stock Exchange.
List"
"Dealing Day" Day on which the London Stock Exchange is open for
business in the trading of securities admitted to
AIM.
"Dealing Disclosure" Dealing disclosure made in accordance with Rule
8 of the Code.
"Disclosed" Disclosed (i) in the preliminary announcement of
IEL's unaudited financial results for the year
ended 31 March 2011, or in the Annual Report, (ii)
in any public, announcement by IEL (through a
Regulatory Information Service) prior to the date
of this announcement, or (iii) otherwise fairly
disclosed in writing (including facsimile) to IIP
or its advisers by or on behalf of IEL prior to
the date of this announcement.
"Effective Date" Date on which the Scheme becomes effective in
accordance with its terms.
"Enlarged IIP Issued share capital of IIP as enlarged by the
Share Capital" issue of the New IIP Shares but excluding the
exercise of any warrants or issue of any other
IIP Shares not referred to in this announcement.
"Fairfax" Fairfax I.S. PLC, financial adviser to IIP,
authorised and regulated by the FSA and
incorporated in England with company registration
number 05496355.
"Form of Proxy" Form of proxy for use by IEL Shareholders in
connection with the Court Meeting.
"FSA" UK Financial Services Authority.
"Guernsey Companies Companies (Guernsey) Law, 2008, as amended from
Law" time to time.
"Hearing Date" Date on which the Court Order is made.
"IEL" or "Indian Indian Energy Limited, a company incorporated
Energy Limited" and registered in Guernsey under the Guernsey
Companies Law with registered number 46601.
"IEL Director" Director of IEL at the date of this announcement.
"IEL Group" IEL and its subsidiary undertakings.
"IEL Options" Options issued by IEL pursuant to the unapproved
share option scheme adopted by IEL on 21 January
2010.
"IEL Shareholder" Holders of IEL Shares.
"IEL Shares" (i) the existing issued ordinary
shares of GBP0.01 each in the
capital of IEL; and (ii) any
further such shares issued after
the date of this announcement but
before the making of the Court
Order, pursuant to the exercise
of the IEL Warrants or IEL
Options.
"IEL Warrants" Warrants issued by IEL pursuant
to: (i) a warrant instrument
dated 25 August 2009; and (ii) a
warrant instrument dated 11
August 2010.
"Infrastructure Infrastructure India plc a company registered and
India plc" or incorporated in the Isle of Man with registered
"IIP" number 002457V.
"IIP Director" A director of IIP at the date of this
announcement.
"IIP Group" IIP and its subsidiary undertakings.
"IIP Shares" Ordinary shares GBP0.01 each in the capital
of IIP.
"London Stock London Stock Exchange plc.
Exchange"
"New IEL Shares" IEL Shares issued to the IEL Directors,
consultants and employees as described in
paragraph 9 of this announcement.
"New IIP Shares" New IIP Shares proposed to be issued by IIP
(credited as fully paid) as consideration under
the Offer or in connection with the conversion
of the Utilico Loan following the approval of
the Utilico Resolution.
"Offer" Offer by IIP for the entire issued share capital
and to be issued share capital of IEL, or its
associates, to be implemented by way of the Scheme
and the other matters to be considered at the
Court Meeting (if any) or, in IIP's discretion,
with the consent of the Panel, by way of a
takeover offer.
"Offer Period" Period from 23 December 2010 until the Effective
Date.
"Opening Position Opening position disclosure made in accordance
Disclosure" with Rule 8 of the Code.
"Overseas Shareholders" IEL Shareholders resident in, or national or
citizens of, jurisdictions outside the UK and
Guernsey.
"Panel" or "Takeover Panel on Takeovers and Mergers.
Panel"
"Proposal" Together, the Offer and the Utilico Loan
Conversion
"Registrars" Capita Registrars (Guernsey) Limited.
"Regulatory Information Any of the services on the list of Regulatory
Service" Information Services maintained by the FSA.
"Restricted Territories" The United States, Australia, Canada, Japan, South
and each a "Restricted Africa and any other jurisdiction where the offer
Territory" of New IIP Shares (or any transaction contemplated
thereby and any activity carried out in connection
therewith) would breach applicable law.
"Scheme" Proposed scheme of arrangement under Part VIII of
the Guernsey Companies Law between IEL and IEL
Shareholders, with or subject to any modification
or addition thereto or condition approved or
imposed by the Court and agreed by IEL and IIP.
"Scheme Document" Document containing the details of the Scheme,
setting out the terms and conditions of the Offer
and the Court Meeting, which is expected to be
sent to IEL Shareholders (other than certain
Overseas Shareholders) by 12 August 2011.
"Scheme Record 6.00 p.m. on the Dealing Day immediately preceding
Time" the Hearing Date.
"Scheme Resolution" Resolution of IEL Shareholders at the Court
Meeting approving the Scheme.
"SEC" The United States Securities and Exchange
Commission.
"UK" or "United The United Kingdom of Great Britain and Northern
Kingdom" Ireland.
"US" or "United The United States of America, its territories
States" and possessions, any state of the United States
and the District of Columbia.
"Utilico" Utilico Emerging Markets Limited, a closed-end
Bermuda incorporated investment company.
"Utilico Loan" The GBP2.5 million facility agreement entered
into on 7 July 2010 between IEL and Utilico
as amended by an amendment agreement dated 22
December 2010.
"Utilico Loan The redemption of the Utilico Loan by the issue
Conversion" to Utilico of the IIP Shares, as is described
in paragraph 3 of this announcement.
"Utilico Resolution" The resolution to be proposed at the EGM for the
purposes of approving the Utilico Loan
Conversion.
"Voting Record In relation to the Court Meeting expected to will
Time" be at 6.00 p.m. two days before the Court Meeting
or, if the Court Meeting is adjourned, 48 hours
before the time set for any such adjourned
meeting.
"Wider IEL Group" IEL and its subsidiary undertakings, associated
undertakings and any other undertaking in which
IEL and/or such undertakings (aggregating their
interest) have a significant interest.
"Wider IIP Group" IIP and its subsidiary undertakings, associated
undertakings and any other undertaking in which
IIP and/or such undertakings (aggregating their
interest) have a significant interest.
1. All references to legislation in this document are to the law
of the Island of Guernsey unless the contrary is indicated. All
references to time in this document are to London time unless the
contrary is indicated.
2. Any reference to any provision of any legislation shall
include any amendment, modification, re-enactment or extension
thereof.
3. Words importing the singular shall include the plural and
vice versa, and words importing the masculine gender shall include
the feminine or neutral gender.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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