Travis Perkins Plc Recommended Cash And Shares Acquisition Of Bss

5th Jul 2010 07:00

TIDMTPK TIDMBTSM RNS Number : 7860O Travis Perkins PLC 05 July 2010 ? NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION IN WHOLE OR IN PART, IN, INTO OR FROM ANY JURISDICTION WHERE TO DO THE SAME WOULD CONSTITUTE A VIOLATION OF THE RELEVANT LAWS OF SUCH JURISDICTION 5 July 2010 PART I TRAVIS PERKINS PLC RECOMMENDED CASH AND SHARES ACQUISITION OF THE BSS GROUP PLC The boards of Travis Perkins plc ("Travis Perkins") and The BSS Group plc ("BSS") are pleased to announce that agreement has been reached on the terms of a recommended proposal whereby Travis Perkins will acquire, for cash and shares, the entire issued and to be issued share capital of BSS. Highlights +----+----+------------------------------------------------------+ | | | +----+-----------------------------------------------------------+ | * | Recommended cash and shares Acquisition valuing each BSS | | | Share at 435.8 pence | +----+-----------------------------------------------------------+ | | | +----+-----------------------------------------------------------+ | * | Consideration for each BSS Share is 232.91 pence in cash, | | | 0.2608 New Travis Perkins Shares valued at 196.8 pence | | | (based on the Closing Price of 754.5 pence per Travis | | | Perkins Share on 2 July 2010, the last Business Day | | | before this announcement) and payment of the BSS Final | | | Dividend for the year ended 31 March 2010 of 6.09 pence | +----+-----------------------------------------------------------+ | | | +----+-----------------------------------------------------------+ | * | A Mix and Match Facility and a Loan Note Alternative will | | | also be available | +----+-----------------------------------------------------------+ | | | +----+-----------------------------------------------------------+ | * | The offer values BSS's issued and to be issued share | | | capital at approximately GBP557.6 million | +----+-----------------------------------------------------------+ | | | +----+-----------------------------------------------------------+ | * | Travis Perkins believes that a powerful strategic logic | | | underpins the combination of BSS and Travis Perkins' | | | existing distribution and retailing businesses in | | | plumbing and heating: | +----+-----------------------------------------------------------+ | | | +----+-----------------------------------------------------------+ | | - | Creates the leading plumbing and heating trade and | | | | retail distribution business in the UK in addition | | | | to Travis Perkins' leading position in UK heavy side | | | | distribution | +----+----+------------------------------------------------------+ | | | | +----+----+------------------------------------------------------+ | | - | The Enlarged Group would have operational and | | | | financial size and scale to purchase products more | | | | competitively and secure the benefits of global | | | | sourcing | +----+----+------------------------------------------------------+ | | | | +----+----+------------------------------------------------------+ | | - | The Enlarged Group should be able to service | | | | customers more efficiently locally and nationally | | | | using Travis Perkins' low cost, layered 'route to | | | | market' supply chain | +----+----+------------------------------------------------------+ | | | | +----+----+------------------------------------------------------+ | | - | The BSS business should benefit from being | | | | integrated into Travis Perkins' information | | | | technology platform, thereby reducing the reliance | | | | on external vendors | +----+----+------------------------------------------------------+ | | | | +----+----+------------------------------------------------------+ | | - | Travis Perkins' medium and long term property | | | | strategy should give both businesses access, at | | | | lower cost, to attractive trading locations | +----+----+------------------------------------------------------+ | | | | +----+----+------------------------------------------------------+ | * | Travis Perkins believes the Acquisition will be value | | | enhancing for shareholders (see Note 1): | +----+-----------------------------------------------------------+ | | | | +----+----+------------------------------------------------------+ | | - | Expected to deliver annual pre-tax cost savings of | | | | at least GBP25 million in 2013 | +----+----+------------------------------------------------------+ | | | | +----+----+------------------------------------------------------+ | | - | Expected to deliver materially enhanced earnings in | | | | 2011, the first full year after completion of the | | | | Acquisition | +----+----+------------------------------------------------------+ | | | | +----+----+------------------------------------------------------+ | | - | Additional growth potential from cross-selling and | | | | revenue synergies (not included in synergy | | | | estimates) | +----+----+------------------------------------------------------+ | | | | +----+----+------------------------------------------------------+ | * | Acquisition price of 435.8 pence represents a premium of | | | approximately: | +----+-----------------------------------------------------------+ | | | | +----+----+------------------------------------------------------+ | | - | 4.7 per cent. to the Closing Price of 416.2 pence | | | | for each BSS Share on 2 July 2010, the last Business | | | | Day prior to this announcement; and | +----+----+------------------------------------------------------+ | | | | +----+----+------------------------------------------------------+ | | - | 34.1 per cent. to the Closing Price of 325 pence per | | | | BSS Share on 27 May 2010, the last Business Day | | | | prior to the announcement that the boards of Travis | | | | Perkins and BSS were in advanced discussions | | | | regarding a possible offer | +----+----+------------------------------------------------------+ | | | +----+-----------------------------------------------------------+ | * | The offer represents a multiple of 10.7 times BSS's | | | adjusted 2010 EBITDA of GBP61.9 million | +----+-----------------------------------------------------------+ | | | +----+-----------------------------------------------------------+ | * | In its interim management statement on 2 July 2010, | | | Travis Perkins announced that, in the absence of | | | unforeseen circumstances, it expects to declare an | | | interim dividend of 5 pence per share when it announces | | | its interim results for the six months to 30 June 2010 on | | | 29 July 2010, with the intention that this will be paid | | | in November 2010 | +----+-----------------------------------------------------------+ | | | +----+-----------------------------------------------------------+ | | - | Holders of the New Travis Perkins Shares will also | | | | be entitled to receive the Travis Perkins Interim | | | | Dividend, save in certain circumstances | +----+----+------------------------------------------------------+ | | | +----+-----------------------------------------------------------+ | * | Irrevocable undertakings have been received from BSS | | | Directors and letters of intent have been received from | | | certain BSS Shareholders to vote in favour of the | (MORE TO FOLLOW) Dow Jones Newswires July 05, 2010 02:00 ET (06:00 GMT)