MENTMORE ABBEY PLC
27 July 1999
SUMMARY
Not for release, publication or distribution in or into the
United States, Canada, Australia or Japan
Proposed Merger
between
Mentmore Abbey plc
&
Birkby PLC
Summary
* The Boards of Mentmore Abbey and Birkby today announce that they have
reached agreement on the terms of a Merger between the two companies. The
Merger will be effected by means of a recommended Offer, to be made by
Singer & Friedlander on behalf of Mentmore Abbey for the Birkby Share
Capital.
* The Merger terms will be 1.7228 New Mentmore Abbey Shares and 92
pence in cash for each Birkby Share and there will be a Mix and Match
Election available to Birkby Shareholders who accept the Offer.
* The combination of the two businesses will create a substantial space
management business providing a broad range of flexible outsourcing
services to over 11,000 domestic and corporate customers. In their
preliminary results for the years ended 30 April 1999 and 31 March 1999,
respectively announced today, Mentmore Abbey and Birkby generated EBITDA
of £9.5 million and £17.8 million respectively and profits before tax and
exceptionals of £6.8 million and £13.2 million respectively.
* Nick Smith, the current Chairman of Mentmore Abbey will become
Chairman of the Merged Group and Kim Taylor-Smith, the current Chief
Executive of Birkby, will be its Chief Executive. Further details of the
Board of the Merged Group are set out in section 8.
* Based on Mentmore Abbey's Closing Price of 130.5 pence on 26 July
1999, the last dealing day prior to this announcement, and on the basis of
the terms of the Merger, the Merged Group would have a market
capitalisation of £226 million.
* The Merger values the Birkby Share Capital at approximately £160
million and each Birkby Share at 317 pence (based on the Closing Price of
130.5 pence per Mentmore Abbey Share on 26 July 1999).
* The Merger represents a premium of 28.5 per cent. over the Closing
Price of 246.5 pence per Birkby Share on 23 June 1999, the last dealing
day prior to the announcement that Mentmore Abbey and Birkby were in
merger talks, and a discount of 0.7 per cent. to the Closing Price of 319
pence per Birkby Share on 26 July 1999, the last dealing day prior to this
announcement.
* Mentmore Abbey has received irrevocable undertakings from the
directors of Birkby, and certain other Birkby Shareholders to accept the
Offer in respect of 17,834,654 Birkby Shares representing approximately
36.5 per cent. of Birkby's existing issued share capital. Of these 12.3
per cent. will cease to be binding if an offer is made by a third party
which is in excess of 110 per cent. of the price offered by Mentmore Abbey
and 24.2 per cent. will cease to be binding or acceptances pursuant to
them will be capable of being withdrawn if any higher offer is made by a
third party for the Birkby Share Capital.
The Merger terms have been recommended unanimously by the Board of Birkby.
Commenting on the Merger, Nick Smith, Chairman of Mentmore Abbey, said
today:
'Today's Merger will combine two of the UK's leading, publicly quoted
space management businesses and advances Mentmore Abbey's strategy of
developing a substantial support services group. The Merged Group will
provide a broad range of outsourcing services to customers throughout the
UK and increasingly in Continental Europe and will seek to maximise cash
generation and shareholder returns. The Merged Group's balance sheet,
strong cash flow and combined management expertise provide an excellent
base from which it can further expand its services and geographical
presence.'
Kim Taylor-Smith, Chief Executive of Birkby said:
'This Merger recognises the underlying value of Birkby and allows both
sets of shareholders to participate in the benefits and opportunities that
the combination of these two complementary businesses should provide. Our
two companies have a natural synergy of concepts: selected Birkby
workspace centres lend themselves readily to the storage concept,
providing the potential to increase income, particularly where there is
under utilised space. The broader range of services offered by the Merged
Group will increase the range of properties appropriate for acquisition
and will provide the opportunity to accelerate the rate of acquisition.'
Press enquiries:
Mentmore Abbey Nick Smith 0171 720 5067
Singer & Friedlander Ian Dighe 0171 623 3000
Greg Aldridge
Collins Stewart Leigh Collins 0171 523 5000
Birkby Kim Taylor-Smith 0121 778 2233
Bill Cran 01484 545151
Dresdner Kleinwort Benson Ben Thorne 0171 623 8000
Buchanan Communications Charles Ryland 0171 466 5000
This summary should be read in conjunction with the full text of the
announcement attached.
FULL DETAILS TO FOLLOW
OFFNFAXKALLNEAN
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