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| Share Name | Share Symbol | Market | Type |
|---|---|---|---|
| Millenmin Ventures Inc | TSXV:MVM | TSX Venture | Common Stock |
| Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
|---|---|---|---|---|---|---|---|---|---|---|
| 0.00 | 0.00% | 0 | - |
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RNS Number:3779N
Merivale Moore PLC
09 July 2003
NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN WHOLE OR IN PART, IN OR INTO
THE UNITED STATES, CANADA, AUSTRALIA, JAPAN OR SINGAPORE
PART ONE OF THREE
9 July 2003
Nest Egg Limited
Recommended Cash Offer for Merivale Moore plc
The board of Nest Egg and the Independent Directors of Merivale Moore are
pleased to announce that they have reached agreement on the terms of a
recommended cash offer, to be made by LCF Rothschild on behalf of Nest Egg, to
acquire the balance of the issued share capital of Merivale Moore not already
owned by Nest Egg and its associates.
The Offer effectively values each Merivale Moore Share at 176 pence. This will
comprise 99 pence per share in cash payable by Nest Egg under the Offer and 77
pence per share in cash which will be paid by way of a Dividend from Merivale
Moore conditionally upon the Offer becoming or being declared wholly
unconditional. The Offer therefore effectively values the entire issued share
capital of Merivale Moore at approximately #34.18 million.
At the same time as and conditionally upon the Offer becoming or being declared
wholly unconditional, and subject to shareholder approval being obtained at an
Extraordinary General Meeting, Merivale Moore has agreed to sell seven
properties to separate subsidiaries of Moorevale Ventures, a company jointly
owned by Moorevale and Uberior, for an aggregate consideration of #46.053
million in cash. Moorevale is a company controlled by Mr. Michael Probert and
Mr. William Arnold, respectively chief executive and finance director of
Merivale Moore, and Mr. Jeffrey Hobby, an employee of Merivale Moore. In
addition, and also conditionally upon the Offer becoming or being declared
wholly unconditional and on shareholder approval being obtained at an
Extraordinary General Meeting, Merivale Moore has agreed to sell two properties
to Charleswood Estates, a company controlled by the family of Mr. Stephen
Vickery, a non-executive director of Merivale Moore, and other parties, for #5.9
million in cash.
Nest Egg is a company owned by members of the family of Mr. Grenville Dean, the
Chairman of Merivale Moore. Nest Egg, its associates to whom the Offer is not
being made and parties acting in concert with Nest Egg already own (including
Merivale Moore Shares held in personal equity plans on behalf of such persons)
4,900,026 Merivale Moore Shares, in aggregate representing approximately 25.23
per cent. of the current issued share capital of Merivale Moore.
Nest Egg has received irrevocable undertakings to accept the Offer in respect of
10,270,037 Merivale Moore Shares, in aggregate representing approximately 52.88
per cent. of the current issued share capital of Merivale Moore.
Nest Egg, its associates to whom the Offer is not being made and parties acting
in concert with Nest Egg therefore own (including Merivale Moore Shares held in
personal equity plans on behalf of such persons), or Nest Egg has received
irrevocable undertakings to accept the Offer in respect of, 13,439,706 Merivale
Moore Shares in aggregate representing approximately 69.21 per cent. of the
current issued share capital of Merivale Moore.
The Offer effectively values each Merivale Moore Share at 176 pence and
represents:
- a premium of approximately 5.7 per cent. over the closing price of 166.5 pence per Merivale Moore
Share on 13 February 2003, being the last business day prior to the release of the announcement of
Merivale Moore's interim results for the six months ended 31 December 2002 in which Mr. Grenville
Dean announced that he would be formulating a proposal which could lead to an offer being made for
the shares in Merivale Moore not already owned by Nest Egg and its associates;
- a premium of approximately 7.0 per cent. over the closing price of 164.5 pence per Merivale Moore
Share on 8 July 2003, being the last business day prior to this announcement; and
- a discount of approximately 2.76 per cent. to the estimated Triple Net Asset Value per Merivale
Moore Share of 181 pence as at 31 May 2003. Further information on the estimated Triple Net Asset
Value of a Merivale Moore Share is set out in Appendix II to this announcement.
The Independent Directors, who have been so advised by Arbuthnot, consider the
terms of the Offer and the terms of the Disposals to be fair and reasonable so
far as Merivale Moore Shareholders are concerned. In providing advice to the
Independent Directors in relation to the terms of the Offer and of the
Disposals, Arbuthnot has taken into account the commercial assessments of the
Independent Directors. The Independent Directors will unanimously recommend that
Public Shareholders accept the Offer, as they have undertaken to do in respect
of their own beneficial holdings which represent in aggregate approximately 1.04
per cent of the current issued share capital of Merivale Moore. The Independent
Directors will also unanimously recommend that Merivale Moore Shareholders who
are entitled to do so vote in favour of the resolutions to approve the Disposals
and to declare the Dividend to be proposed at the Extraordinary General Meeting.
The Independent Directors comprise the directors of Merivale Moore with the
exception of: Mr. Grenville Dean, who is associated with Nest Egg; Mr. Michael
Probert and Mr. William Arnold, respectively chief executive and finance
director of Merivale Moore, who are precluded as a consequence of their interest
in Moorevale Ventures and its proposed purchase of certain properties from
Merivale Moore; and Mr. Stephen Vickery, a non-executive director of Merivale
Moore, who is also precluded as a consequence of his interest in Charleswood
Estates and its proposed purchase of certain properties from Merivale Moore.
Mr. Grenville Dean, representing Nest Egg, said: "Property is a cyclical
business and the markets in which Merivale Moore operates have now gone into
reverse. I believe it is a sensible time to return to shareholders their own
funds before further erosion occurs. The proposals here outlined are designed to
be equitable to all parties. They achieve three objectives. First, at a fair
price, existing shareholders will be bought out of an illiquid and potentially
declining investment. Secondly, the employees of Merivale Moore will be fairly
treated. Thirdly, Merivale Moore will be taken back to where it began, and to
what it is now best suited to be, namely a small private family company."
Mr. Ernest Chapman, the Chairman of the Independent Directors said: "The
Independent Directors believe that this is an appropriate conclusion to the
existence of Merivale Moore as a quoted company. The value of the Offer is fair
and we will be recommending that Merivale Moore Shareholders accept it and
approve the related proposals which enable the Offer to be made."
Appendix III to this announcement contains a copy of the unaudited interim
accounts of Merivale Moore for the nine months ended 31 March 2003, prepared for
the parent company only in accordance with section 270(4) of the Act, which
demonstrate that Merivale Moore has sufficient distributable reserves to pay the
Dividend. A copy of these accounts will be delivered shortly to the Registrar of
Companies in England and Wales.
This summary should be read in conjunction with Parts Two and Three of, and the
Appendices to, this announcement.
Enquiries:
Nest Egg Limited
Grenville Dean: Tel: 020 7589 6365
LCF Rothschild Securities Limited
Edward Buchan: Tel: 020 7845 5957
Andrew Hay: Tel: 020 7845 5955
Merivale Moore plc
Ernest Chapman: Tel: 020 7399 2300
Arbuthnot Securities Limited
Tom Griffiths: Tel: 020 7002 4600
Moorevale Ventures Limited
Michael Probert: Tel: 020 7399 2300
Bankside Consultants Limited
Charles Ponsonby: Tel: 020 7444 4166
LCF Rothschild, which is regulated in the United Kingdom by the Financial
Services Authority, is acting exclusively for Nest Egg and no one else in
connection with the Offer and will not be responsible to any other person for
providing the protections offered to customers of LCF Rothschild nor for
advising any other person on the contents of this announcement.
Arbuthnot, which is regulated in the United Kingdom by the Financial Services
Authority, is acting exclusively for Merivale Moore and the Independent
Directors in connection with the Offer and the Disposals and will not be
responsible to any other person for providing the protections offered to
customers of Arbuthnot nor for advising any other person on the contents of this
announcement.
Part Three of this announcement contains the conditions to and certain further
terms of the Offer. Appendices I to IV contain, respectively, the sources and
bases of information used in this announcement, the calculations of estimated
net assets and estimated Triple Net Asset Value as at 31 May 2003 and letters
relating thereto, the unaudited interim accounts of Merivale Moore for the nine
months ended 31 March 2003 and the definitions used in this announcement.
The full terms and conditions of the Offer (including details of how the Offer
may be accepted) will be set out in the Offer Document and the accompanying Form
of Acceptance. In deciding whether or not to accept the Offer, Merivale Moore
shareholders must rely solely on the terms and conditions of the Offer and the
information contained, and the procedures described, in the Offer Document and
the related Form of Acceptance.
This announcement does not constitute an offer to sell, or the solicitation of
an offer to purchase or subscribe for, any securities.
The Offer will not be made, directly or indirectly, in or into the United
States, Canada, Australia, Japan or Singapore. Accordingly, copies of this
announcement are not being sent and must not be mailed or otherwise distributed
in or into or from the United States, Canada, Australia, Japan or Singapore and
persons receiving this announcement must not distribute or send it into or from
such countries.
Nest Egg accepts responsibility for the information contained in this
announcement relating to Nest Egg.
Merivale Moore accepts responsibility for the information contained in this
announcement relating to Merivale Moore.
NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN WHOLE OR IN PART, IN OR INTO
THE UNITED STATES, CANADA, AUSTRALIA, JAPAN OR SINGAPORE
PART TWO OF THREE
9 July 2003
Nest Egg Limited
Recommended Cash Offer for Merivale Moore plc
1. Introduction
The board of Nest Egg and the Independent Directors of Merivale Moore announce
that they have reached agreement on the terms of a recommended cash Offer for
all the issued ordinary shares of Merivale Moore not already owned by Nest Egg
and its associates, to be made by LCF Rothschild on behalf of Nest Egg.
The Offer effectively values each Merivale Moore Share at 176 pence. This will
comprise 99 pence per share in cash payable by Nest Egg under the Offer and 77
pence per share in cash which will be paid by way of a Dividend from Merivale
Moore conditionally upon the Offer becoming or being declared wholly
unconditional. The Offer therefore effectively values the entire issued share
capital of Merivale Moore at approximately #34.18 million.
At the same time as and conditionally upon the Offer becoming or being declared
wholly unconditional, and subject to shareholder approval being obtained at an
Extraordinary General Meeting, Merivale Moore has agreed to sell seven
properties to separate subsidiaries of Moorevale Ventures, a company jointly
owned by Moorevale and Uberior, for an aggregate consideration of #46.053
million in cash. Moorevale is a company controlled by Mr. Michael Probert and
Mr. William Arnold, respectively chief executive and finance director of
Merivale Moore, and Mr. Jeffrey Hobby, an employee of Merivale Moore. In
addition, and also conditionally upon the Offer becoming or being declared
wholly unconditional and on shareholder approval being obtained at an
Extraordinary General Meeting, Merivale Moore has agreed to sell two properties
to Charleswood Estates, a company controlled by the family of Mr. Stephen
Vickery, a non-executive director of Merivale Moore, and other parties, for #5.9
million in cash.
Nest Egg is a company owned by the members of the family of Mr. Grenville Dean,
the Chairman of Merivale Moore. Nest Egg, its associates to whom the Offer is
not being made and parties acting in concert with Nest Egg already own
(including Merivale Moore Shares held in personal equity plans on behalf of such
persons) 4,900,026 Merivale Moore Shares, in aggregate representing
approximately 25.23 per cent. of the current issued share capital of Merivale
Moore.
As set out in the Chairman's statement of 14 February 2003 included in Merivale
Moore's 2003 Interim Report, Mr. Grenville Dean announced then that he would be
formulating a proposal which could lead to an offer being made for the shares in
Merivale Moore not already owned by Nest Egg and its associates, against a
background of declining capital values in the central London office market.
At 176 pence per share (including the Dividend), the Offer represents a premium
of approximately 7.0 per cent. over the closing price of a Merivale Moore Share
on 8 July 2003, being the last business day prior to this announcement, and a
discount of 2.76 per cent. to the estimated Triple Net Asset Value of each
Merivale Moore Share as at 31 May 2003. Further information on the estimated
Triple Net Asset Value of a Merivale Moore Share is set out in Appendix II to
this announcement.
2. The Offer
The Offer, which will be made subject to the conditions and further terms set
out in Part Three of this announcement and in the formal Offer Document and Form
of Acceptance to be sent to the Public Shareholders in due course, will be made
for the entire issued share capital of Merivale Moore not already owned by Nest
Egg and its associates on the following basis:
For each Merivale Moore Share 99 pence in cash payable by Nest Egg
under the Offer
In addition, subject to the Offer becoming or being declared wholly
unconditional, Merivale Moore will pay a Dividend of 77 pence per Merivale Moore
Share to shareholders on the register of members at the close of business on the
day immediately preceding the date on which the Offer becomes or is declared
wholly unconditional.
The Merivale Moore Shares to be acquired pursuant to the Offer will be acquired
fully paid, free of all liens, charges, encumbrances, rights of pre-emption and
any other third party rights of any nature whatsoever and together with all
rights now or hereafter attaching to them, including the right in full to all
dividends or any other distributions declared, paid or made on or after 9 July
2003, other than the Dividend.
The Offer effectively values the issued share capital of Merivale Moore at
approximately #34.18 million and each Merivale Moore Share at 176 pence and
represents:
- a premium of approximately 5.7 per cent. over the closing price of a
Merivale Moore Share on 13 February 2003, being the last business day before the
release of the announcement of Merivale Moore's interim results for the six
months ended 31 December 2002 in which Mr. Grenville Dean announced that he
would be formulating a proposal which could lead to an offer being made for the
shares in Merivale Moore not already owned by Nest Egg and its associates;
- a premium of approximately 7.0 per cent. over the closing price of a
Merivale Moore Share on 8 July 2003, being the last business day prior to this
announcement; and
- a discount of approximately 2.76 per cent. to the estimated Triple Net
Asset Value per Merivale Moore Share of 181 pence as at 31 May 2003. Further
information on the estimated Triple Net Asset Value per Merivale Moore Share is
set out in Appendix II to this announcement.
For comparison, Merivale Moore's share price performance over the last five
years shows:
- high (10 June 2002) : 185.0 pence
- low (6 October 1998) : 57.5 pence
- average over the past 12 months : 170.5 pence
3. Irrevocable undertakings
The following parties have irrevocably undertaken to accept the Offer in respect
of beneficial shareholdings which amount to 10,270,037 Merivale Moore Shares in
aggregate representing approximately 52.88 per cent. of Merivale Moore's issued
share capital:
(a) the Independent Directors, other than Mr Philip Warner, in
respect of 201,510 Merivale Moore Shares in aggregate amounting to approximately
1.04 per cent. of Merivale Moore's issued share capital;
(b) Michael Probert, William Arnold and Stephen Vickery in
respect of 159,821 Merivale Moore Shares in aggregate amounting to approximately
0.82 per cent of Merivale Moore's issued share capital;
(c) Cardiff & Provincial Properties Limited a wholly owned
subsidiary of Warner Estate (of which Mr. Philip Warner, an Independent Director
of Merivale Moore, is Chairman), in respect of 5,031,610 Merivale Moore Shares
amounting to approximately 25.91 per cent. of Merivale Moore's issued share
capital; and
(d) certain other shareholders in Merivale Moore, in respect of
4,877,096 Merivale Moore Shares in aggregate amounting to approximately 25.11
per cent. of Merivale Moore's issued share capital.
These shares, when aggregated with the shares already owned by Nest
Egg, its associates to whom the Offer is not being made and parties acting in
concert with Nest Egg (including Merivale Moore Shares held in personal equity
plans on behalf of such persons), amount to 13,439,706 Merivale Moore Shares
which in aggregate represent approximately 69.21 per cent. of Merivale Moore's
issued share capital.
4. Dividend
Subject to the resolution approving the payment of the Dividend being passed at
the Extraordinary General Meeting (as described below), and to the Offer
becoming or being declared wholly unconditional, Merivale Moore will pay a
Dividend of 77 pence per Merivale Moore Share to shareholders on the register at
the close of business on the date immediately prior to the date on which the
Offer becomes or is declared wholly unconditional. The Dividend will be paid
not later than 14 days after the Offer becomes or is declared wholly
unconditional.
Appendix III to this announcement contains a copy of the unaudited interim
accounts of Merivale Moore for the nine months ended 31 March 2003, prepared for
the parent company only in accordance with section 270(4) of the Act, which
demonstrate that Merivale Moore has sufficient distributable reserves to pay the
Dividend. A copy of these accounts will be delivered shortly to the Registrar of
Companies in England and Wales.
5. Property Disposals and Extraordinary General Meeting
Merivale Moore has agreed, subject to obtaining the approval of its shareholders
and conditional upon the Offer becoming or being declared unconditional in all
respects, to sell seven properties to separate subsidiaries of Moorevale
Ventures, a company jointly owned by Moorevale and Uberior, for an aggregate
cash consideration of #46.053 million. These properties, which have been
independently valued as at 31 May 2003 by Chesterton plc at approximately #44.99
million, generate net annual rents of approximately #3.15 million. Moorevale is
a company controlled by Messrs. Michael Probert and William Arnold who are,
respectively, chief executive and finance director of Merivale Moore, and Mr
Jeffrey Hobby, an employee of Merivale Moore. Moorevale Ventures will be
receiving equity and bank finance from The Governor and Company of the Bank of
Scotland and equity finance from Michael Probert, William Arnold and Jeffrey
Hobby; the directors of Moorevale will be receiving loans of in aggregate
approximately #1 million from West Norfolk Tomatoes Limited, a company owned by
the family of Mr. Grenville Dean, which will be used to fund Moorevale and
Moorevale Ventures. Mr Grenville Dean has also agreed to provide Michael
Probert, William Arnold, Jeffrey Hobby and Moorevale with an indemnity of up to
#70,000 in respect of any abortive costs. Escrow arrangements have been agreed
which will ensure that the disposals to Moorevale Ventures complete at the same
time as the Offer becomes or is declared wholly unconditional. These
arrangements will be described in further detail in the documentation to be sent
to Merivale Moore Shareholders in due course.
Merivale Moore has also agreed, subject to obtaining the approval of its
shareholders and conditional upon the Offer becoming or being declared wholly
unconditional, to sell two development properties to Charleswood Estates, a
company controlled by the family of Mr. Stephen Vickery, a non-executive
director of Merivale Moore, for a cash consideration of #5.9 million being the
value at which these properties have been independently valued as at 31 May 2003
by Chesterton plc. The properties currently produce a total annual net income of
approximately #360,000 but, subject to planning permission and vacant
possession, are capable of redevelopment.
The net proceeds of the Disposals will be used by Merivale Moore, inter alia, to
repay bank debt and to pay the Dividend.
As referred to above, the Independent Directors, who have been so advised by
Arbuthnot, consider the terms of the Disposals to be fair and reasonable so far
as Merivale Moore Shareholders are concerned. In providing advice to the
Independent Directors in relation to the terms of the Disposals, Arbuthnot has
taken into account the commercial assessments of the Independent Directors.
The Disposals are required by the Listing Rules, the Code and the Act to be
approved by the independent shareholders of Merivale Moore. An Extraordinary
General Meeting of Merivale Moore will be convened for this purpose at which
three ordinary resolutions will be proposed, two to approve the Disposals to
separate subsidiaries of Moorevale Ventures and to Charleswood Estates
respectively and one to approve the payment of the Dividend. The Offer is
conditional upon all three resolutions being passed, on the disposals to
Moorevale Ventures having been completed in escrow and on the disposals to
Charleswood Estates having become unconditional (except for the Offer becoming
or being declared wholly unconditional).
6. Property Valuation
The Independent Directors commissioned valuations of the properties owned by
Merivale Moore as at 31 May 2003. The valuations were carried out by Chesterton
plc, and showed a total value of approximately #94.5 million. The Directors
estimate that as at 31 May 2003 the estimated net assets per share of Merivale
Moore were 197 pence and the estimated Triple Net Asset Value per share was 181
pence. Further information is set out in Appendix II to this announcement
regarding the estimated net assets and the estimated Triple Net Asset Value as
at 31 May 2003.
7. Reasons for and Background to the Offer
In recent years Merivale Moore has achieved significant growth in net asset
value by the application of a focused investment policy directed at buying
substantial office blocks in multiple occupations in central London and
industrial investment properties in South East England. This has led to an
average annual increase of 21.6 per cent. in pro forma net assets per share over
the last six financial years, equivalent to the trebling of pro forma net asset
value per share over the same period. However, although Merivale Moore
Shareholders have enjoyed good appreciation in share value during this period,
in common with most quoted property companies the price at which the Merivale
Moore Shares trade has continued to be at a substantial discount to underlying
net asset value.
In the six months to 31 December 2002 Merivale Moore's net assets per share fell
by approximately 14 per cent, due principally to falling central London office
rents and the fact that the market was in decline. Furthermore, a lack of
activity in the high value market in which the Company operates meant that there
were limited buying opportunities; and this in turn adversely affected the
Company's rate of net asset value growth. This needs to be set against the
background of a combination of weak demand for office space and a considerable
excess of space in central London.
The Directors estimate that, as at 31 May 2003, Merivale Moore's net assets per
share were 197 pence, a further fall of approximately 13 per cent. since 31
December 2002. In the opinion of the Board, the central London office market, in
which around 75 per cent. of Merivale Moore's assets are invested, is unlikely
to recover quickly; and Merivale Moore does not wish to make major new
investments in current market conditions.
While the Board considers that Merivale Moore could sustain itself through the
present downturn, it would face continuing costs and overheads which might
impinge further on the Company's share price and the level of discount to net
asset value.
In the light of these factors and the continuing decline in net asset value, the
Independent Directors agreed to consider an offer for Merivale Moore as a
sensible means of achieving value for all Public Shareholders.
At 176 pence per share (including the Dividend), the effective Offer value
represents a premium of approximately 7.0 per cent. over the closing price of a
Merivale Moore Share on 8 July 2003, being the last business day prior to this
announcement, and a discount of 2.76 per cent. to the estimated Triple Net Asset
Value of each Merivale Moore Share as at 31 May 2003. Further information on the
estimated net assets and the estimated Triple Net Asset Value per share as at 31
May 2003 is set out in Appendix II to this announcement.
8. Recommendation
The Independent Directors of Merivale Moore, who have been so advised by
Arbuthnot, consider the terms of the Offer and the terms of the Disposals to be
fair and reasonable so far as Merivale Moore Shareholders are concerned. In
providing advice to the Independent Directors in relation to the terms of the
Offer and of the Disposals, Arbuthnot has taken into account the commercial
assessments of the Independent Directors.
The Independent Directors will unanimously recommend that the Public
Shareholders accept the Offer, as they have undertaken to do in respect of their
own beneficial holdings which represent in aggregate approximately 1.04 per
cent. of the current issued share capital of Merivale Moore. The Independent
Directors will also unanimously recommend that the Public Shareholders who are
entitled to do so vote in favour of the resolutions to approve the Disposals and
to declare and approve payment of the Dividend to be proposed at the
Extraordinary General Meeting of Merivale Moore.
The Independent Directors comprise the directors of Merivale Moore with the
exception of: Mr. Grenville Dean who is associated with Nest Egg; Mr. Michael
Probert and Mr. William Arnold, respectively chief executive and finance
director of Merivale Moore, who are precluded as a consequence of their interest
in Moorevale Ventures and its proposed purchase of certain properties from
Merivale Moore; and Mr. Stephen Vickery, a non-executive director of Merivale
Moore, who is precluded as a consequence of his interest in Charleswood Estates
and its proposed purchase of certain properties from Merivale Moore.
9. Loan Notes
Merivale Moore has outstanding #4,619,664 million of the Loan Notes which were
issued in 2001 as part of the consideration for its acquisition of Dunsterville
Allen plc.
Merivale Moore will offer, conditionally upon the Offer becoming or being
declared wholly unconditional, to purchase any or all of the Loan Notes from
their respective holders at their par value, together with interest accrued up
to the day immediately preceding such purchase. It is expected that the various
Loan Note holders associated with Charleswood Estates will accept this offer to
provide funds for Charleswood Estates's proposed purchase of certain properties
from Merivale Moore.
Full details of the offer to purchase Loan Notes will be set out in the
documentation to be sent to holders of Loan Notes in due course.
10. Information on Merivale Moore
Merivale Moore was formed by Mr. Grenville Dean in 1961 and its shares were
listed on the London Stock Exchange in 1985. It is a property investment
company specialising in well located, multi-let office investments, mainly in
the West End of London and in Holborn, and industrial estates situated in the
South East of England.
As at 30 June 2002, Merivale Moore's most recent financial year end for which
audited accounts are available, the property portfolio was invested 73 per cent.
in office property, 22 per cent. in industrial property and 5 per cent. in other
properties; 75 per cent. of the portfolio was in London, 22 per cent. in the
South East outside London, and 3 per cent. elsewhere.
The table below sets out details of Merivale Moore's unaudited pro forma net
assets as at 31 December 2002, together with unaudited pro forma figures as at
30 June 2002 and unaudited pro forma figures as at 31 December 2001 for
comparison:
Merivale Moore plc - Unaudited pro forma net assets at 31 December 2002
31 December 2002 30 June 31 December 2001
#'000 2002 #'000
#'000
Fixed Assets Investment Properties 77,741 89,040 73,463
Other tangible assets 71 88 114
Investments - 1,400 1,400
77,812 90,528 74,977
Current Assets Stocks 25,342 27,724 24,893
Investments 34 34 34
Debtors 1,969 1,877 6,814
Bank balances and cash 11,102 12,017 12,563
38,447 41,652 44,304
Creditors due within one year 40,162 51,365 41,618
Net current (liabilities)/assets (1,715) (9,713) 2,686
Total assets less current liabilities 76,097 80,815 77,663
Creditors due after more than one year 32,271 32,131 32,508
Pro forma net assets 43,826 48,684 45,155
Pro forma net assets per share 225.7p 263.3p 225.9p
Triple Net Assets per share 190.3p 211.9p 184.2p
For further information on Merivale Moore's unaudited pro forma net assets
please see Appendix I to this announcement.
11. Information on Nest Egg
Nest Egg is a private company owned the children of Mr. Grenville Dean, the
Chairman of Merivale Moore. Established in 1993 to hold residential property
investments, Nest Egg is currently an investment company for the Dean family and
owns 75,000 Merivale Moore Shares. Merivale Moore will, upon the Offer becoming
or being declared wholly unconditional, become a subsidiary of Nest Egg. It is
Nest Egg's intention that, following the Disposals, Merivale Moore will retain
the majority of the remaining properties as investments while disposing of some
over a period of time.
The consideration for the Offer will be provided by bank debt provided by The
Co-operative Bank p.l.c. conditionally on the Offer becoming or being declared
wholly unconditional, by loans from the Dean family, and otherwise out of Nest
Egg's resources. Details of the bank facility will be set out in the Offer
Document.
12. Management and Employees
Mr. Michael Probert and Mr. William Arnold, being respectively chief executive
and finance director of Merivale Moore, and Mr. Jeffrey Hobby and Mrs. Stephanie
Arnold, both employees of Merivale Moore, will be made redundant as a result of
and immediately following the Offer becoming or being declared wholly
unconditional and agreement has been reached in respect of compensation payments
for loss of office, details of which will be contained in the Offer Document.
Michael Probert, William Arnold and Jeffrey Hobby will become executive
directors of Moorevale, whose associate Moorevale Ventures will have acquired a
portfolio of properties from Merivale Moore, as described above. After the Offer
has become or has been declared wholly unconditional Moorevale Management
Limited, a company associated with Moorevale, will provide property management
services to Nest Egg, details of which will be contained in the Offer Document.
Nest Egg has confirmed that the employment rights of Merivale Moore's employees,
including pension entitlements, will be fully safeguarded.
13. Inducement Fee
In consideration of Nest Egg undertaking to announce the Offer, Merivale Moore
has agreed that it will pay Nest Egg an inducement fee of #341,789 (being an
amount equivalent to one per cent. of the value of Merivale Moore on the basis
of the effective Offer value) in the event that the Offer lapses or is withdrawn
following:
(a) the recommendation by some or all of the Independent
Directors of an offer for Merivale Moore from a third party, such an offer
having been accepted unconditionally by Nest Egg and by all of the parties in
respect of at least the number of Merivale Moore Shares listed in paragraph 15
(b) below; or
(b) the withdrawal by the Independent Directors of their
recommendation of the Offer and/or their recommendation to vote in favour of the
resolutions to be proposed at the Extraordinary General Meeting, save if such
withdrawal is for the reason that any of the resolutions was put to the meeting
and not passed, or that Moorevale or Moorevale Ventures or any of their
subsidiaries fails to complete the Moorevale Disposal Agreements in escrow, or
that Charleswood Estates or any of its subsidiaries fail to complete
unconditionally the Charleswood Disposal Agreements; or
(c) some or all of the Independent Directors taking or expressly
approving the taking of any action specifically prohibited by Rule 21.1 of the
Code (excluding the Disposals and the Dividend on which the Offer is
conditional).
14. Offer Document and Circular
The formal Offer Document will be despatched to the Public Shareholders in due
course.
The Circular, containing full details of the Disposals (including the
independent valuations of the relevant properties) and the Dividend, and notice
of the Extraordinary General Meeting will be despatched to Merivale Moore
Shareholders in due course.
15. Disclosure of interests in Merivale Moore
(a) As at the close of business on 8 July 2003, being the last
business day prior to this announcement, Nest Egg owned or had control over
75,000 Merivale Moore Shares, amounting to approximately 0.39 per cent. of
Merivale Moore's issued share capital.
(b) As at the close of business on 8 July 2003, being the last
business day prior to this announcement, the following parties who are deemed to
be acting in concert with Nest Egg owned or had control over Merivale Moore
Shares as set out below:
Number of Merivale Moore % of Merivale Moore's
Shares issued share capital
West Norfolk Tomatoes Limited 1,495,357 7.70
Grenville Dean 1,744,157 8.98
Sophie Reeves 119,050 0.61
Neil Symons 7,500 0.04
Polly Dean 772,762 3.98
Josephine Dean 50,000 0.26
Toby Dean (including Merivale Moore Shares 271,810 1.40
held in PEPs)
Victoria Dean (including Merivale Moore 179,390 0.92
Shares held in PEPs)
Morgan Stanley Quilter Nominees 185,000 0.95
Total (including those Merivale Moore
Shares owned or controlled by Nest Egg)
4,825,026 24.85
(c) As at the close of business on 8 July 2003, being the last
business day prior to this announcement, the following related parties (as
defined in the Listing Rules) who have or may have a direct interest in the
Disposals owned or had control over Merivale Moore Shares as set out below:
Number of Merivale Moore % of Merivale Moore's
Shares issued share capital
Michael Probert 65,000 0.33
William Arnold 68,000 0.35
Stephanie Arnold 800 0.01
Stephen Vickery 26,821 0.14
Nicola Vickery 1,063 0.01
Total 161,684 0.83
(d) The Offer will not be made to the following holders of
Merivale Moore Shares in respect of the number of Merivale Moore Shares listed
below, not including Nest Egg:
Number of Merivale Moore % of Merivale Moore's
Shares issued share capital
Grenville Dean 1,744,157 8.98
Polly Dean 772,762 3.98
Toby Dean (excluding Merivale Moore Shares 255,230 1.31
held in PEPs)
Victoria Dean (excluding Merivale Moore 162,650 0.84
Shares held in PEPs)
Sophie Reeves 119,050 0.61
Total 3,053,849 15.73
Nest Egg and the parties set out in 15(d) above have entered into an agreement
whereby none of the parties to the agreement may sell, transfer or otherwise
dispose of, pledge, mortgage, charge or otherwise encumber its legal or
beneficial interest in any Merivale Moore Shares (including any Merivale Moore
Shares which are acquired pursuant to the Offer), or agree to do any of the
foregoing, without first obtaining the written consent of each other party to
the agreement. These restrictions shall not apply to any Merivale Moore Shares
held by West Norfolk Tomatoes Limited, a company owned by the parties set out in
15(d) above.
16. De-listing, cancellation of trading and re-registration
If the Offer becomes or is declared wholly unconditional, Nest Egg intends to
procure the making of applications by Merivale Moore to the UK Listing Authority
for the cancellation of the listing of Merivale Moore Shares on the Official
List of the UK Listing Authority and to the London Stock Exchange for the
cancellation of trading in Merivale Moore Shares on its market for listed
securities. It is anticipated that such cancellations will take effect no
earlier than 20 business days after the date on which the Offer becomes or is
declared wholly unconditional. The cancellation of listing and trading would
significantly reduce the liquidity and marketability of any Merivale Moore
Shares in respect of which valid acceptances of the Offer are not received.
If Nest Egg receives acceptances under the Offer in respect of, and/or otherwise
acquires, 90 per cent. or more of the Merivale Moore Shares to which the Offer
relates, Nest Egg will exercise its rights pursuant to the provisions of
sections 428 to 430F of the Act to acquire compulsorily the remaining Merivale
Moore Shares to which the Offer relates.
It is further intended that, following the Offer becoming or being declared
wholly unconditional and following the cancellation of listing and trading
referred to above, Merivale Moore will be re-registered as a private company
under the relevant provisions of the Act.
17. General
Part Three of this announcement contains the conditions to and certain further
terms of the Offer. Appendices I to IV contain, respectively, the sources and
bases of information used in this announcement, the calculations of estimated
net assets and estimated Triple Net Asset Value as at 31 May 2003 and letters
relating thereto, the unaudited interim accounts of Merivale Moore for the nine
months ended 31 March 2003 and the definitions used in this announcement.
The full terms and conditions of the Offer will be set out in the Offer Document
and the accompanying Form of Acceptance. In deciding whether or not to accept
the Offer, Merivale Moore Shareholders must rely solely on the terms and
conditions of the Offer and the information contained, and the procedures
described in the Offer Document and the related Form of Acceptance.
This announcement does not constitute an offer to sell or the solicitation of an
offer to purchase or subscribe for any securities.
LCF Rothschild, which is regulated in the United Kingdom by the Financial
Services Authority, is acting exclusively for Nest Egg and no one else in
connection with the Offer and will not be responsible to any other person for
providing the protections offered to customers of LCF Rothschild nor for
advising any other person on the contents of this announcement.
Arbuthnot, which is regulated in the United Kingdom by the Financial Services
Authority, is acting exclusively for Merivale Moore and the Independent
Directors in connection with the Offer and the Disposals and will not be
responsible to any other person for providing the protections offered to
customers of Arbuthnot nor for advising any other person on the contents of this
announcement.
The Offer will not be made, directly or indirectly, in or into the United
States, Canada, Australia, Japan or Singapore. Accordingly, copies of this
announcement are not being sent and must not be mailed or otherwise distributed
in or into or from the United States, Canada, Australia, Japan or Singapore and
persons receiving this announcement must not distribute or send it into or from
such countries.
Nest Egg accepts responsibility for the information contained in this
announcement relating to Nest Egg.
Merivale Moore accepts responsibility for the information contained in this
announcement relating to Merivale Moore.
NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN WHOLE OR IN PART, IN OR INTO
THE UNITED STATES, CANADA, AUSTRALIA, JAPAN OR SINGAPORE
PART THREE OF THREE
9 July 2003
Nest Egg Limited
Recommended Cash Offer for Merivale Moore plc
Conditions and Certain Further Terms of the Offer
The Offer will comply with the rules and regulations of the Financial Services
Authority, the London Stock Exchange and the Code.
Part A: Conditions of the Offer
The Offer will be subject to the following conditions:
(a) valid acceptances being received (and not, where permitted, withdrawn)
by not later than 3.00 p.m. on the first closing date of the Offer (or such
later time(s) and/or date(s) as Nest Egg may, with the consent of the Panel or
in accordance with the Code, decide) in respect of not less than 90 per cent.
(or such lower percentage as Nest Egg may decide) in nominal value of the
Merivale Moore Shares to which the Offer relates, provided that this condition
shall not be satisfied unless Nest Egg shall have acquired or agreed to acquire,
whether pursuant to the Offer or otherwise, shares in Merivale Moore which, when
aggregated with the Dean Family Interests, carry in aggregate more than 50 per
cent. of the voting rights then normally exercisable at general meetings of
Merivale Moore. For the purposes of this condition:
(i) shares which have been unconditionally allotted, whether pursuant to
the exercise of any outstanding subscription or conversion rights or otherwise,
shall be deemed to carry the voting rights they will carry on being entered into
the Register of Members of Merivale Moore; and
(ii) the expression "Merivale Moore Shares to which the Offer relates"
shall be construed in accordance with sections 428 to 430F of the Companies Act
1985, as amended;
(b) the passing, at an Extraordinary General Meeting of Merivale Moore, of
the necessary resolution or resolutions approving the Moorevale Disposal
Agreements and the Charleswood Disposal Agreements and a resolution declaring
and approving the payment of the Dividend;
(c) the Moorevale Disposal Agreements becoming unconditional (except for any
condition or conditions contained therein relating to the Offer becoming or
being declared unconditional in all respects) and having been completed in
escrow in accordance with the Escrow Agreement such that upon the Offer becoming
or being declared unconditional in all respects the Escrow Condition (as defined
in the Escrow Agreement) will be fulfilled with no provision of any agreement
being amended, varied or waived without the prior approval of Nest Egg;
(d) the Charleswood Disposal Agreements becoming unconditional (except for
any condition or conditions contained therein relating to the Offer becoming or
being declared unconditional in all respects) with completion subject only to
the Offer becoming or being declared unconditional in all respects, with no
provision of any agreement being amended, varied or waived without the approval
of Nest Egg;
(e) except as publicly announced by Merivale Moore or as fairly disclosed in
writing by Merivale Moore to Nest Egg prior to 8 July 2003 (being the last
business day before the announcement of the Offer) or pursuant to the Moorevale
Disposal Agreements or the Charleswood Disposal Agreements or the Escrow
Agreement or the offer to purchase the Loan Notes, there being no provision of
any agreement, arrangement, licence, permit or other instrument to which any
member of the wider Merivale Moore Group is a party or by or to which any such
member or any of its assets may be bound, entitled or subject, which in
consequence of the Offer or the proposed acquisition of any shares or other
securities in Merivale Moore or because of a change in the control or management
of Merivale Moore, could result in, to an extent which is material in the
context of the wider Merivale Moore Group taken as a whole:
(i) any moneys borrowed by or any other indebtedness (actual or
contingent) of, or grant available to any such member, being or becoming
repayable or capable of being declared repayable immediately or earlier than
their or its stated maturity date or repayment date or the ability of any such
member to borrow moneys or incur any indebtedness being withdrawn or inhibited
or being capable of becoming or being withdrawn or inhibited;
(ii) any such agreement, arrangement, licence, permit or instrument or
the rights, liabilities, obligations or interests of any such member thereunder
being terminated or modified or affected or any obligation or liability arising
or any action being taken thereunder;
(iii) any assets or interests of any such member being or falling to be
disposed of or charged or any right arising under which any such asset or
interest could be required to be disposed of or charged;
(iv) the creation or enforcement of any mortgage, charge or other
security interest over the whole or any part of the business, property or assets
of any such member;
(v) the rights, liabilities, obligations or interests of any such member
in, or the business of any such member with, any person, firm or body (or any
arrangement or arrangements relating to any such interest or business) being
terminated, adversely modified or affected;
(vi) the value of any such member or its financial or trading position or
prospects being prejudiced or adversely affected;
(vii) any such member ceasing to be able to carry on business under any
name under which it presently does so; or
(viii) the creation of any liability, actual or contingent, by any
such member
and no event having occurred which, under any provision of any agreement,
arrangement, licence, permit or other instrument to which any member of the
wider Merivale Moore 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) of
this paragraph (e) which is material in the context of the wider Merivale Moore
Group taken as a whole;
(f) except to the extent consequent upon the execution and completion of
the Moorevale Disposal Agreements and the Charleswood Disposal Agreements, no
government or governmental, quasi-governmental, supranational, statutory,
regulatory, environmental or investigative body, court, trade agency,
association, institution or any other body or person whatsoever in any
jurisdiction (each a "Third Party") having decided to take, institute, implement
or threaten in writing any action, proceeding, suit, investigation, enquiry or
reference, or enacted, made or proposed any statute, regulation, decision or
order, or having taken any other steps which would or might reasonably be
expected to:
(i) require, prevent or delay the divestiture, or materially alter the
terms envisaged for any proposed divestiture by Merivale Moore or any member of
the wider Merivale Moore Group of all or any portion of their respective
businesses, assets or property or impose any limitation on the ability of any of
them to conduct their respective businesses (or any of them) or to own any of
their respective assets or properties or any part thereof which, in any such
case, is material in the context of the wider Merivale Moore Group taken as a
whole or of the financing of the Offer;
(ii) require, prevent or delay the divestiture by Nest Egg of any shares
or other securities in Merivale Moore;
(iii) impose any material limitation on, or result in a delay in, the
ability of Nest Egg directly or indirectly to acquire or to hold or to exercise
effectively any rights of ownership in respect of shares or loans or securities
convertible into shares or any other securities (or the equivalent) in any
member of the wider Merivale Moore Group or Nest Egg to exercise management
control over any such member;
(iv) otherwise adversely affect the business, assets, profits or
prospects of any member of the wider Merivale Moore Group in a manner which is
adverse to, and material in the context of, the wider Merivale Moore Group taken
as a whole ;
(v) make the Offer or its implementation or the acquisition or proposed
acquisition by Nest Egg of any shares or other securities in, or control of
Merivale Moore void, illegal, and/or unenforceable under the laws of any
jurisdiction, or otherwise, directly or indirectly, restrain, restrict,
prohibit, delay or otherwise materially interfere with the same, or impose
additional conditions or obligations with respect thereto, or otherwise
challenge or interfere therewith;
(vi) require Nest Egg or any member of the wider Merivale Moore Group to
offer to acquire any shares or other securities (or the equivalent) or interest
in any member of the wider Merivale Moore Group owned by any third party;
(vii) impose any limitation on the ability of any member of the wider
Merivale Moore Group to co-ordinate its business, or any part of it, with the
businesses of any other members which is adverse to and material in the context
of the wider Merivale Moore group taken as a whole; or
(viii) result in any member of the wider Merivale Moore Group
ceasing to be able to carry on business under any name under which it presently
does so;
and all applicable waiting and other time periods during which any such Third
Party could institute, implement or threaten any action, proceeding, suit,
investigation, enquiry or reference or any other step under the laws of any
jurisdiction in respect of the Offer having expired, lapsed or been terminated;
(g) all necessary filings or applications having been made in connection
with the Offer and all statutory or regulatory obligations in any jurisdiction
having been complied with in connection with the Offer or the acquisition by
Nest Egg of any shares or other securities in, or control of, Merivale Moore and
all authorisations, orders, recognitions, grants, consents, licences,
confirmations, clearances, permissions and approvals reasonably deemed necessary
or appropriate by Nest Egg for or in respect of the Offer including without
limitation, its implementation of the proposed acquisition of any shares or
other securities in, or control of, Merivale Moore by Nest Egg having been
obtained in terms and in a form satisfactory to Nest Egg (acting reasonably)
from all appropriate Third Parties or persons with whom any member of the wider
Merivale Moore Group has entered into contractual arrangements and all such
authorisations, orders, recognitions, grants, consents, licences, confirmations,
clearances, permissions and approvals together with all material authorisations,
orders, recognitions, grants, licences, confirmations, clearances, permissions
and approvals necessary or appropriate to carry on the business of any member of
the wider Merivale Moore Group which is material in the context of the wider
Merivale Moore Group taken as a whole remaining in full force and effect and all
filings necessary for such purpose have been made and there being no notice or
intimation of any intention to revoke or not to renew any of the same at the
time at which the Offer becomes otherwise unconditional and all necessary
statutory or regulatory obligations in any jurisdiction having been complied
with;
(h) except as publicly announced by Merivale Moore or fairly disclosed in
writing by Merivale Moore to Nest Egg prior to 8 July 2003 being the last
business day before the announcement of the Offer or pursuant to the Moorevale
Disposal Agreements or the Charleswood Disposal Agreements or the Escrow
Agreement or the offer to purchase the Loan Notes, no member of the wider
Merivale Moore Group having, since 30 June 2002:
(i) save as between Merivale Moore and wholly-owned
subsidiaries of Merivale Moore or Merivale Moore Shares issued pursuant to the
exercise of options granted under any Merivale Moore share option schemes,
issued, authorised or proposed the issue of additional shares of any class;
(ii) save as between Merivale Moore and wholly-owned
subsidiaries of Merivale Moore or for the grant of options under any Merivale
Moore share option schemes, issued or agreed to issue, authorised or proposed
the issue of securities convertible into shares of any class or rights, warrants
or options to subscribe for, or acquire, any such shares or convertible
securities;
(iii) other than to another member of the Merivale Moore
Group, recommended, declared, paid or made or proposed to recommend, declare,
pay or make any bonus, dividend or other distribution whether payable in cash or
otherwise, save for the final dividend of 4.5p per Merivale Moore Share in
respect of the year ended 30 June, 2002, the interim dividend of 2.5p per
Merivale Moore Share paid on 22 April, 2003 and the Dividend;
(iv) save for intra-Merivale Moore Group transactions, merged or demerged
with any body corporate or acquired or disposed of or transferred, mortgaged or
charged or created any security interest over any assets or any right, title or
interest in any asset (including shares and trade investments) or authorised or
proposed or announced any intention to propose any merger, demerger, acquisition
or disposal, transfer, mortgage, charge or security interest (in each case,
other than in the ordinary course of business), and which is material in the
context of the wider Merivale Moore Group taken as a whole;
(v) save for intra-Merivale Moore Group transactions, made
or authorised or proposed or announced an intention to propose any change in its
loan capital;
(vi) save for intra-Merivale Moore Group transactions, issued, authorised
or proposed the issue of any debentures or, save in the ordinary course of
business, incurred or increased any indebtedness to a material extent or become
subject to any contingent liability;
(vii) purchased, redeemed or repaid or announced any proposal to purchase,
redeem or repay any of its own shares or other securities or reduced or, save in
respect to the matters mentioned in sub-paragraph (i) above, made any other
change to any part of its share capital;
(viii) save for the redundancy of Michael Probert and William Arnold,
implemented, or authorised, proposed or announced its intention to implement,
any reconstruction, amalgamation, scheme, commitment or other transaction or
arrangement otherwise than in the ordinary course of business or entered into or
changed the terms of any contract with any director or senior executive;
(ix) entered into or varied or authorised, proposed or announced its
intention to enter into or vary any contract, transaction or commitment (whether
in respect of capital expenditure or otherwise) which is of a long term, onerous
or unusual nature or magnitude or which is or could be materially restrictive on
the businesses of any member of the wider Merivale Moore Group or which involves
or could involve an obligation of such a nature or magnitude or which is other
than in the ordinary course of business and which is material in the context of
the wider Merivale Moore Group taken as a whole;
(x) (other than in respect of a member which is dormant and
was solvent at the relevant time) taken any corporate action or had any legal
proceedings started or threatened against it for its winding-up, dissolution or
reorganisation or for the appointment of a receiver, administrative receiver,
administrator, trustee or similar officer of all or any of its assets or
revenues or any analogous proceedings in any jurisdiction or had any such person
appointed;
(xi) waived or compromised any claim otherwise than in the ordinary course
of business and which is material in the context of the wider Merivale Moore
Group taken as a whole; or
(xii) entered into any contract, commitment, arrangement or agreement
otherwise than in the ordinary course of business or passed any resolution or
made any offer (which remains open for acceptance) with respect to or announced
any intention to, or to propose to, effect any of the transactions, matters or
events referred to in this condition and which is material in the context of the
wider Merivale Moore Group taken as a whole;
and, for the purposes of sub-paragraphs (iii), (iv), (v) and (vi) of this
condition, the term "Merivale Moore Group" shall mean Merivale Moore and its
wholly-owned subsidiaries;
(i) since 30 June 2002 and save as disclosed in Merivale Moore's annual
report and accounts for the year then ended and save as publicly announced in
accordance with the Listing Rules by Merivale Moore or fairly disclosed in
writing by Merivale Moore to Nest Egg prior to 9 July 2003 or pursuant to the
Moorevale Disposal Agreements or the Charleswood Disposal Agreements which in
any such case is material in the context of the wider Merivale Moore Group taken
as a whole or the Offer:
(i) no adverse change or deterioration having occurred in
the business, assets, financial or trading position or profits or prospects of
any member of the wider Merivale Moore Group;
(ii) no litigation, arbitration proceedings, prosecution or
other legal proceedings to which any member of the wider Merivale Moore Group is
or may become a party (whether as a claimant, defendant or otherwise) and no
investigation by any Third Party against or in respect of any member of the
wider Merivale Moore Group having been instituted, announced or threatened in
writing by or against or remaining outstanding in respect of any member of the
wider Merivale Moore Group which in any such case might reasonably be expected
to materially adversely affect any member of the wider Merivale Moore Group;
(iii) no contingent or other liability having arisen or
become apparent to Nest Egg which would be likely to materially adversely affect
any member of the wider Merivale Moore Group; and
(iv) no steps having been taken which are likely to result in the
withdrawal, cancellation, termination or modification of any licence held by any
member of the wider Merivale Moore Group which is necessary for the proper
carrying on of its business;
(j) Nest Egg not having discovered that:
(i) any past or present member of the wider Merivale Moore Group has
failed to comply with any and/or all applicable legislation or regulation, of
any jurisdiction with regard to the disposal, spillage, release, discharge, leak
or emission of any waste or hazardous substance or any substance 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
disposal, spillage, release, discharge, leak or emission (whether or not the
same constituted a non-compliance by any person with any such legislation or
regulations, and wherever the same may have taken place) any of which disposal,
spillage, release, discharge, leak or emission would be likely to give rise to
any liability (actual or contingent) on the part of any member of the wider
Merivale Moore Group and which is material in the context of the wider Merivale
Moore Group taken as a whole or of the financing of the Offer; or
(ii) there is, or is likely to be, for that or any other reason
whatsoever, any liability (actual or contingent) of any past or present member
of the wider Merivale Moore Group to make good, repair, reinstate or clean up
any property or any controlled waters now or previously owned, occupied,
operated or made use of or controlled by any such past or present member of the
wider Merivale Moore group, under any environmental legislation, regulation,
notice, circular or order of any government, governmental, quasi-governmental,
state or local government, supranational, statutory or other regulatory body,
agency, court, association or any other person or body in any jurisdiction and
which is material in the context of the wider Merivale Moore Group taken as a
whole or of the financing of the Offer;
For the purposes of these conditions the "wider Merivale Moore Group" means
Merivale Moore and its subsidiary undertakings, associated undertakings and any
other undertaking in which Merivale Moore and/or such undertakings (aggregating
their interests) have a significant interest and for these purposes "subsidiary
undertaking", "associated undertaking" and "undertaking" have the meanings given
by the Act, other than paragraph 20(1)(b) of Schedule 4A to that Act which shall
be excluded for this purpose, and "significant interest" means a direct or
indirect interest in ten per cent or more of the equity share capital (as
defined in the Act).
Nest Egg reserves the right to waive, in whole or in part, all or any of the
above conditions, except conditions (a), (b) and (c).
Conditions (d) to (j) (inclusive) must be fulfilled or waived by midnight on the
21st day after the later of the first closing date of the Offer and the date on
which conditions (a), (b) and (c) are fulfilled (or in each such case such later
date as Nest Egg may, with the consent of the Panel, decide). Nest Egg shall be
under no obligation to waive or treat as satisfied any of the conditions (d) to
(j) (inclusive) by a date earlier than the latest date specified above for the
satisfaction thereof, 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.
If Nest Egg is required by the Panel to make an offer for Merivale Moore Shares
under the provisions of Rule 9 of the Code, Nest Egg may make such alterations
to any of the above conditions as are necessary to comply with the provisions of
that Rule.
The Offer will lapse if it is referred to the Competition Commission before 3.00
p.m. on the first closing date of the Offer or the date on which the Offer
becomes or is declared unconditional as to acceptances, whichever is the later.
If the Offer lapses for any reason, the Offer will cease to be capable of
further acceptance and Public Shareholders accepting the Offer and Nest Egg
shall upon the Offer lapsing cease to be bound by acceptances delivered on or
before the date on which the Offer lapses.
This Offer will be governed by English law and be subject to the jurisdiction of
the English courts, to the conditions set out below and in the formal Offer
Document and related Form of Acceptance.
Part B: Certain further terms of the Offer
The Offer will not be made, directly or indirectly, in or into, or by use of the
mails of, or by any means or instrumentality (including, without limitation,
facsimile transmission, telex, telephone or e-mail) of interstate or foreign
commerce of, or of any facility of a national securities exchange of, the United
States, Canada, Australia, Japan and Singapore, and the Offer will not be
capable of acceptance by any such use, means, instrumentality or facility or
from within the United States, Canada, Australia, Japan and Singapore.
Merivale Moore Shares to be acquired pursuant to the Offer will be acquired
under the Offer fully paid, free from all liens, equities, charges, encumbrances
and other interests and together with all rights attaching thereto save for the
right to receive the Dividend.
Further terms of the Offer will be contained in the Offer Document and the Form
of Acceptance.
Appendix I
Sources and Bases of Information
1. General
Unless otherwise stated the financial information relating to Merivale Moore has
been extracted from the relevant published audited annual report and accounts
and unaudited interim results of Merivale Moore and/or other public statements
made by Merivale Moore.
2. Value of the Offer
The value of the issued share capital of Merivale Moore (#34.18 million) is
calculated on the basis of 19,419,840 Merivale Moore Shares in issue.
3. Share Prices
The closing prices of Merivale Moore Shares on 6 October 1998, 10 June 2002, 13
February 2003 and 8 July 2003 have been derived from the Daily Official List of
the London Stock Exchange.
4. Information on Merivale Moore
The unaudited pro forma net assets are based upon the unaudited net assets of
Merivale Moore as adjusted:
(i) to uplift the cost of properties held as current assets
(stocks) to their valuation at the date of the statement. There was no valuation
undertaken in respect of property assets at 31 December 2001;
(ii) to add back negative goodwill which will be released to the
profit and loss account on disposal of the property assets to which it relates.
The reconciliation of unaudited net assets to pro forma net assets at each date
was as follows:
31 December 30 June 31 December
2002 2002 2001
#'000 #'000 #'000
Net Assets 38,352 40,646 38,859
Stock adjustment 5,306 7,626 5,655
Negative goodwill adjustment 168 412 641
43,826 48,684 45,155
The Triple Net Asset Value per share is calculated by adjusting pro forma net
assets for contingent tax payable on the realisation of all properties and
investments at the values at which they are stated in the pro forma statement,
and by adjustments to record financial instruments at their fair value. The
amounts of these adjustments were:
31 December 30 June 31 December
2002 2002 2001
#'000 #'000 #'000
Contingent tax (3,831) (6,825) (5,641)
Fair value adjustments (3,050) (2,671) (2,697)
(6,881) (9,496) (8,338)
Appendix II
Estimated net assets and estimated Triple Net Asset Value
1. Estimated net assets
The Directors estimate that, on the basis described below, Merivale Moore's
consolidated net assets as at 31 May 2003 were approximately #38.26 million,
being equivalent to 197 pence per Merivale Moore Share. This estimate has been
compiled in accordance with the accounting policies normally adopted by Merivale
Moore.
The estimated net assets have been based on:
(a) the independent valuation of Merivale Moore's properties
performed by Chesterton plc as at 31 May 2003; and
(b) the unaudited consolidated management accounts of Merivale
Moore for the nine months ended 31 March 2003 and an estimate for the two months
ended 31 May 2003.
The estimated net assets have been prepared on the assumption that there will be
no material adjusting post balance sheet events.
2. Estimated Triple Net Asset Value
The table below provides a calculation of the estimated Triple Net Asset Value
per Merivale Moore Share, for illustrative purposes, as at 31 May 2003.
This calculation has been performed in order to assist Merivale Moore
Shareholders in their evaluation of the Offer in comparison with previous cash
offers for similar property companies.
Actual realisable values may differ from the values set out below due to the
timing of disposals and fluctuations in market prices.
Pence per
Merivale Moore
Notes #'000 Share
Merivale Moore's estimated net assets as at 31
May 2003 38,260 197.0
Adjustments:
(a) Valuation surpluses on stocks properties (i)
at 31 May 2003 4,562 23.5
(b) Tax at 30 per cent. on stocks valuation
surpluses at 31 May 2003 (1,370) (7.1)
(c) FRS 13 adjustment (ii) (4,819) (24.8)
(d) Tax at 30 per cent. on FRS 13 adjustment
1,446 7.4
(e) Deficit on investment properties (iii)
revaluation at 31 May 2003 (1,580) (8.1)
(f) Adjustment for release of negative (iv)
goodwill 168 0.9
36,667 188.8
(g) Contingent tax on investment properties (v) (1,522) (7.8)
at 31 May 2003
Estimated Triple Net Asset Value (vi) 35,145 181.0
Notes:
(i) Valuation surpluses based on independent valuations performed by
Chesterton plc as at 31 May 2003.
(ii) Adjustments to restate financial assets and liabilities to fair
value in accordance with FRS 13 as at 31 May 2003, principally relating to the
10.5 per cent. First Mortgage Debenture Stock 2020 with a nominal value of #10.2
million.
(iii) Valuation deficit based on independent valuations performed by
Chesterton plc as at 31 May 2003.
(iv) Negative goodwill of #168,000 will be released on the disposal of
the property assets which established the reserve.
(v) Provision for tax at 30 per cent. on the valuation surpluses on
investment properties at 31 May 2003.
(vi) The calculation of the estimated Triple Net Asset Value has been
calculated in accordance with the method used to calculate Triple Net Asset
Value per share as reported in Merivale Moore's interim report for the 6 months
ended 31 December 2002.
3. Letters
The Directors have received the following letters in connection with the
estimated net assets and the estimated Triple Net Asset Value:
LETTER FROM AUDIT ASSURE
RELATING TO MERIVALE MOORE'S ESTIMATED NET ASSETS AND
ESTIMATED TRIPLE NET ASSET VALUE
Audit Assure
Audrey House
16/20 Ely Place
London EC1N 6SN
The Directors
Merivale Moore plc
43-44 New Bond Street
London W1S 2SG
The Directors
Arbuthnot Securities Limited
2 Lambeth Hill
London EC4V 4GG
9 July 2003
Dear Sirs,
MERIVALE MOORE PLC (THE "COMPANY")
We have reviewed the basis of compilation and the accounting policies for the
estimates as at 31 May 2003 of the Company's consolidated net assets and triple
net asset value (together the "estimates") as set out in Appendix II to the
Offer announcement dated 9 July 2003 issued by LCF Rothschild Securities Limited
on behalf of Nest Egg Limited.
We conducted our work in accordance with the Statements of Investment Circular
Reporting Standards issued by the Auditing Practices Board.
The directors of the Company are solely responsible for the estimates.
The estimated net assets have been based on:
(i) the independent valuations of the Company's properties performed by
Chesterton plc as at 31 May 2003; and
(ii) the unaudited consolidated management accounts of the Company for
the nine months ended 31 March 2003 and an estimate for the two months ended and
as at 31 May 2003.
The bases of the adjustments to the estimated net assets are set out in the
notes to the table in Appendix II to the Offer announcement.
In our opinion:
(i) the estimated net assets have been properly compiled on the bases stated
and the basis of accounting is consistent with the accounting policies of the
Company; and
(ii) the adjustments to the estimated net assets to determine the estimated
triple net asset value have been properly calculated on the basis of the
underlying information.
This letter is provided to the addressees solely in connection with Rule 28.3(b)
of the City Code on Takeovers and Mergers and for no other purpose. We accept
no responsibility other than to the addressees in respect of this letter.
Yours faithfully,
For and on behalf of
Audit Assure
Chartered Accountants
Audit Assure has given and has not withdrawn its written consent to the
publication of this letter in the form and context in which it appears.
LETTER FROM ARBUTHNOT
RELATING TO MERIVALE MOORE'S ESTIMATED NET ASSETS AND
ESTIMATED TRIPLE NET ASSET VALUE
Arbuthnot Securities Limited
2 Lambeth Hill
London EC4V 4GG
The Directors
Merivale Moore plc
43-44 New Bond Street
London W1S 2SG
9 July 2003
Dear Sirs,
MERIVALE MOORE PLC (THE "COMPANY")
We refer to the estimated net assets and estimated triple net asset value of the
Company as at 31 May 2003 (the "Estimates") as set out in Appendix II to the
Offer announcement dated 9 July 2003, for which the directors of the Company are
solely responsible.
We have discussed the Estimates including the bases on which they have been
prepared with the directors of the Company and those officers and employees of
the Company responsible for their compilation. We have also discussed the
accounting policies and calculations for the Estimates with Audit Assure,
auditors of the Company, and have considered their letter of 9 July 2003
addressed to you and ourselves on this matter.
This letter is provided to the directors of the Company solely in connection
with Rule 28.3(b) of the City Code on Takeovers and Mergers and for no other
purpose. We accept no responsibility other than to the directors of the Company
in respect of this letter.
On the basis of the foregoing, we consider that the Estimates, for which the
directors of the Company are solely responsible, have been prepared by the
directors of the Company with due care and consideration.
Yours faithfully,
For and on behalf of
Arbuthnot Securities Limited
Registered in England and Wales No. 762818. Registered office: Royex House,
Aldermanbury Square, London EC2V 7NV.
Arbuthnot Securities Limited has given and has not withdrawn its written consent
to the publication of this letter in the form and context in which it appears.
Appendix III
Unaudited interim accounts of Merivale Moore plc
for the nine months ended 31 March 2003
This financial information has been extracted without material adjustment from
unaudited interim accounts prepared for the parent company only for the purposes
of section 270(4) of the Act. It does not and is not intended to represent the
results of Merivale Moore Group for the same period. A copy of the unaudited
interim accounts of Merivale Moore plc for the nine months ended 31 March 2003
will be delivered shortly to the Registrar of Companies in England and Wales.
Basis of preparation
The accounts have been prepared in accordance with the provisions of sections
270(4) and 272 of the Act for the purposes of determining the amount of
distributable profits available to Merivale Moore plc (the "Company").
Directors responsibilities
Company law requires the directors of public companies to prepare interim
accounts where a proposed distribution would be found to contravene sections
263, 264 or 265 of the Act by reference only to its last annual accounts.
The interim accounts are required to be properly prepared subject only to
matters which are not material for determining whether the proposed distribution
would contravene the relevant section of the Act. In order to be properly
prepared, the interim accounts must give a true and fair view of the Company's
state of affairs at the date of the accounts and of the profit or loss of the
Company for the period then ended.
In preparing accounts, the directors are required to select suitable accounting
policies and then apply them consistently; make judgements and estimates that
are reasonable and prudent; state whether applicable accounting standards have
been followed, subject to any material departures disclosed and explained in the
accounts; prepare the accounts on the going concern basis unless it is
inappropriate to presume that the Company will continue in business.
The directors are responsible for keeping proper accounting records which
disclose with reasonable accuracy at any time the financial position of the
Company and to enable them to ensure that the accounts comply with the Act. The
are also responsible for safeguarding the assets of the Company and hence for
taking reasonable steps for the prevention and detection of fraud and other
irregularities.
The interim accounts are unaudited.
Unaudited profit and loss account of Merivale Moore plc
Notes Nine months to 31 Nine months to
March 2003 31 March 2002
# #
Administrative expenses 2 367,332 396,753
(367,332) (396,753)
Other operating income 3 12 766
Operating loss (367,320) (395,987)
Exceptional item 4 (184,042) -
(551,362) (395,987)
Income from shares in group undertakings 5 6,148,748 12,143,722
Net interest payable 6 2,906,995 3,357,382
3,241,753 8,786,340
Profit on ordinary activities before tax 2,690,391 8,390,353
Tax charge 7 153,237 26,176
Profit on ordinary activities after tax 2,537,154 8,364,177
Dividends 8 484,731 500,052
Retained profit for the period 19 2,052,423 7,864,125
All profit and loss items relate to continuing activities.
The Company has no recognised gains or losses other than as disclosed above.
Unaudited balance sheet of Merivale Moore plc
Notes 31 March 2003 31 March 2002
# #
Fixed Assets
Tangible fixed assets 9 23,638 47,516
Investment in subsidiary undertakings 10 74,430,670 78,551,225
74,454,308 78,598,741
Current Assets
Investments 11 33,670 33,670
Debtors 12 194,478 298,403
Bank balances and cash 9,709,825 12,439,312
9,937,973 12,771,385
Creditors due within one year 13 41,750,726 32,760,211
Net current liabilities (31,812,753) (19,988,826)
Total assets less current liabilities 42,641,555 58,609,915
Creditors due after more than one year 14
18,120,000 32,218,000
Net assets 24,521,555 26,391,915
Capital and reserves
Called up share capital 17 970,992 999,583
Share premium account 18 5,804,722 4,156,070
Capital redemption reserve 19 182,639 104,089
Profit and loss account 19 17,563,202 21,132,173
Total shareholders' funds - equity interests 20
24,521,555 26,391,915
Unaudited Cash Flow Statement of Merivale Moore plc
Notes Nine months to Nine months to
31 March 2003 31 March 2002
# #
Net cash outflow from operating activities 22.1 (325,812) (609,868)
Returns on investments and servicing of finance 22.2 (3,131,026) (3,400,626)
Taxation 168,079 41,436
Capital expenditure and financial investment 22.2 19,082,869 15,519,933
Acquisitions and disposals 22.2 180,919 -
Equity dividends paid (876,323) (649,729)
15,424,518 11,511,014
Cash inflow before use of liquid resources and
financing 15,098,706 10,901,146
Financing - repurchase of ordinary shares (124,165) -
- issue of ordinary shares 1,698,611 5,200
- decrease in debt 22.2 (18,980,201) (7,680,823)
(17,405,755) (7,675,623)
(Decrease)/increase in cash in the period (2,307,049) 3,225,523
Reconciliation of net cash flow to movement in
net debt 22.3
(Decrease)/increase in cash in the period (2,307,049) 3,225,523
Cash outflow from decrease in debt 18,980,201 7,680,823
Movement in net debt 16,673,152 10,906,346
Net debt at 1 July 2002 (64,891,213) (61,626,450)
Net debt at 31 March 2003 (48,218,061) (50,720,104)
Notes to the Interim Accounts
1. Accounting policies
1.1 Basis of accounting
The accounts have been prepared on the historical cost basis.
1.2 Compliance with Accounting Standards
The accounts have been prepared in accordance with all applicable Accounting
Standards.
1.3 Depreciation
Depreciation is provided at the following rates in order to write off the cost
of assets over their estimated useful lives:
- Leasehold premises: over the life of the lease
- Furniture: 15% on reducing balance
method
1.4 Investment in subsidiary undertakings
Investment in subsidiary undertakings is shown at cost except that advantage is
taken of the merger relief provisions contained in section 131 of the Companies
Act 1985 and hence shares issued as consideration for the acquisition of shares
in subsidiary undertakings are included at their nominal value. Any diminutions
in value below original cost or carrying value no longer required are written
off in the profit and loss account. Provisions for diminution in value below
original cost or carrying value no longer required are written back in the
profit and loss account.
1.5 Investments
Investments are stated at cost less provision for permanent diminution in value.
1.6 Interest charges
Interest is charged to the profit and loss account as incurred.
1.7 Cost of raising bank finance
The cost of raising bank finance is written off to the profit and loss account
over the life of the loan under the classification of interest charges.
1.8 Tax
Tax payable is provided on taxable profits at the current rates.
2. Administrative expenses
These include the following:
Nine months to 31 Nine months to
March 2003 31 March 2002
# #
Depreciation 17,835 18,127
Operating lease charges - land and buildings 47,920 46,091
- plant and machinery 8,148 7,150
Auditors' remuneration - audit fees 34,590 36,750
- tax 22,945 60,275
- other 18,775 18,147
Directors' emoluments 30,000 27,154
3 Other operating income
Nine months to Nine months to
31 March 2003 31 March 2002
# #
Dividends receivable 12 16
Other income - 750
12 766
4 Exceptional item
Nine months to Nine months to
31 March 2003 31 March 2002
# #
Loss on sale of investment in subsidiary undertaking 184,042 -
Income from shares in group undertakings
5
Nine months to Nine months to
31 March 2003 31 March 2002
# #
Dividends receivable 9,522,115 11,500,000
Provisions against investments in/
loans to subsidiary undertakings (3,373,367) 643,722
6,148,748 12,143,722
6 Net interest payable
Nine months to Nine months to
31 March 2003 31 March 2002
# #
Interest payable - bank loans and 1,605,574 1,622,380
overdrafts
- other loans 1,558,021 1,961,270
Interest receivable (256,600) (226,268)
2,906,995 3,357,382
7 Tax charge
Nine months to Nine months to
31 March 2003 31 March 2002
# #
Current tax:
UK corporation tax on profits for the period 120,000 -
Prior years' adjustments 33,237 (9,362)
Total current tax 153,237 (9,362)
Deferred tax:
Origination and reversal of timing differences - 35,538
Tax on profit on ordinary activities 153,237 26,176
The effective rate of tax payable for the current period is lower than the standard rate of
corporation tax in the UK. The differences are explained below:
Nine months to Nine months to
31 March 2003 31 March 2002
# #
Profit on ordinary activities before tax 2,690,391 8,390,353
Profit on ordinary activities multiplied by standard
rate of corporation tax in the UK of 30% 807,117 2,517,106
Effects
of:
Non-taxable items - dividends from group undertakings (2,856,634) (3,450,000)
Items not allowable - provisions against investments in 1,012,010 (193,117)
for tax subsidiary undertakings
- other 64,213 9,000
Surrender of group losses 1,093,294 1,117,011
Prior years' adjustments 33,237 (9,362)
Current tax charge/(credit) for period 153,237 (9,362)
8 Dividends
Nine months to Nine months to
31 March 2003 31 March 2002
# #
Final 2002 proposed - adjustment (765) 260
Interim 2003 proposed - 2.5p per 485,496 499,792
share
484,731 500,052
9 Tangible fixed
assets
Leasehold premises Furniture Total
# # #
Cost:
At 1 July 2002 and at 31 March 2003 70,263 20,000 90,263
Depreciation:
At 1 July 2002 43,240 5,550 48,790
Charge for period 16,215 1,620 17,835
At 31 March 2003 59,455 7,170 66,625
Net book value:
At 31 March 2003 10,808 12,830 23,638
10 Investment in subsidiary #
undertakings
Cost of shares:
At 1 July 2002 36,548,135
Disposals (640,000)
At 31 March 2003 35,908,135
Provision for diminution in
value:
At 1 July 2002 15,548,441
Provided in period 2,019,178
On disposal (275,039)
At 31 March 2003 17,292,580
Net book value 18,615,555
Loans 55,815,115
74,430,670
11 Current asset investments
31 March 2003 31 March 2002
# #
Investments traded on the London Stock Exchange at cost (Market 335 335
value #542)
Unquoted investments at cost (Directors' valuation #33,335) 33,335 33,335
33,670 33,670
12 Debtors
31 March 2003 31 March 2002
# #
Other debtors 23,876 23,239
Prepayments 170,602 216,454
Deferred tax asset - 58,710
194,478 298,403
13 Creditors due within one year
31 March 2003 31 March 2002
# #
Bank overdrafts and loans 34,544,513 22,295,107
Floating rate guaranteed unsecured loan notes 2010 5,263,373 8,646,309
Other creditors including taxation and social 395,243 127,818
security
Accruals and deferred income 761,725 940,038
Corporation tax payable 300,376 251,147
Proposed dividend 485,496 499,792
41,750,726 32,760,211
14 Creditors due after more than one
year
31 March 2003 31 March 2002
# #
10.5% First mortgage debenture stock 2020 10,200,000 10,200,000
Bank and other 7,920,000 22,018,000
loans
18,120,000 32,218,000
15 Net borrowings
31 March 2003 31 March 2002
# #
Due within one year or on demand:
Bank overdraft, loans and other 34,544,513 22,295,107
loans
Floating rate guaranteed unsecured loan notes 2010 5,263,373 8,646,309
Bank balances and cash (9,709,825) (12,439,312)
30,098,061 18,502,104
Due after more than one year:
10.5% First mortgage debenture stock 2020 10,200,000 10,200,000
Bank and other loans - repayable within two years 2,107,500 1,087,500
Loans - repayable within five years 3,800,000 15,193,000
Loans - repayable after five years by instalments 2,012,500 5,737,500
48,218,061 50,720,104
Bank balances and cash include a bank deposit of #5,263,373 which is charged to one of the Company's
lenders in connection with its guarantee of the floating rate guaranteed unsecured loan notes 2010.
Other borrowings are secured by charges on properties owned by subsidiary undertakings and by cash
deposits of #642,500.
The floating rate guaranteed unsecured loan notes are redeemable by the Company in 2010 but are
included in short term creditors as the creditors may request repayment each six months.
The loan repayable in instalments after five years has a mortgage rate of 7.3 per cent. fixed until
August 2008. The Company has entered into interest rate arrangements which have limited its short
term interest rate exposure at 31 March 2003 on #9,800,000 of bank overdrafts and loans.
16 Deferred tax
Nine months to Nine months to
31 March 2003 31 March 2002
# #
Deferred tax asset at 1 July - 94,248
Deferred tax charge in profit and loss - (35,538)
account
Deferred tax asset at 31 March - 58,710
17 Called up share capital
31 March 2003 31 March 2002
# #
Authorised:
40,000,000 (2002: 40,000,000) ordinary shares of 5p each 2,000,000 2,000,000
Allotted, issued and fully
paid:
19,419,840 (2002: 19,991,664) ordinary shares of 5p each 970,992 999,583
On 1 July 2002, 999,176 ordinary shares of 5p each were issued at #1.70 per share in exchange for
the conversion of #1,698,611 floating rate guaranteed unsecured loan notes 2010. During the period
71,000 ordinary shares were repurchased by the Company and subsequently cancelled. During the period
from 1 April 2002 to 30 June 2002, 1,500,000 ordinary shares were repurchased by the Company and
subsequently cancelled.
18 Share premium account
Nine months Nine months
to 31 March to 31 March
2003 2002
# #
At 1 July 4,156,070 4,151,270
Issue of ordinary shares 1,648,652 4,800
At 31 March 5,804,722 4,156,070
19 Reserves
Capital redemption Profit and
reserve loss account
# #
At 1 July 2002 179,089 15,634,944
Repurchase of 3,550 (124,165)
shares
Retained profit for the period - 2,052,423
At 31 March 2003 182,639 17,563,202
The Directors consider that #16,693,666 of the profit and loss account balance of #17,563,202
is distributable.
20 Reconciliation of movements in shareholders' funds
Nine months to Nine months to
31 March 2003 31 March 2002
# #
Profit for the 2,537,154 8,364,177
period
Dividends 484,731 500,052
2,052,423 7,864,125
New share capital subscribed 1,698,611 5,200
Repurchase of (124,165) -
shares
Net addition to shareholders' funds 3,626,869 7,869,325
Opening shareholders' funds at 1 July 20,894,686 18,522,590
Closing shareholders' funds at 31 March 24,521,555 26,391,915
21 Related party transactions
During the period the Company disposed of its investment in Rathbone Estates Limited at arm's length
to West Norfolk Tomatoes Limited, a company controlled by the children of Mr J G Dean, Chairman,
and of which Mr Dean is a director. West Norfolk Tomatoes Limited provided secretarial services to
the Company during the period amounting to #18,750.
22 Notes to the cash flow statement
Nine months to Nine months to
31 March 2003 31 March 2002
# #
22.1 Reconciliation of operating loss to operating cash flows:
Operating loss before exceptional (367,320) (395,987)
items
Depreciation 17,835 18,127
Decrease/ (increase) in debtors 34,768 (15,548)
Decrease in creditors (11,095) (216,460)
Net cash outflow from operating activities (325,812) (609,868)
22.2 Analysis of cash flows for headings netted in the cash flow
statement:
Returns on investments and servicing of finance:
Interest received 344,142 158,991
Interest paid (3,475,168) (3,559,617)
Net cash outflow from returns on investments and servicing of (3,131,026) (3,400,626)
finance
Acquisitions and disposals:
Disposal of subsidiary undertaking
Cash consideration 180,919 -
Capital expenditure and financial
investment:
Repayment of loans to subsidiary undertakings 19,082,869 15,519,933
Financing:
Repurchase of ordinary shares (124,165) -
Issue of ordinary shares 1,698,611 5,200
Debt due within one year:
(Decrease)/ increase in short term (5,107,201) 1,642,486
borrowings
Debt due after more than one year:
Repayment of bank and other loans (13,873,000) (9,323,309)
Net cash outflow from financing (17,405,755) (7,675,623)
Analysis of net 1 July 2002 Cash flow 31 March 2003
debt: # # #
Bank balances and cash 12,016,874 (2,307,049) 9,709,825
Debt due within one year (44,915,087) 5,107,201 (39,807,886)
Debt due after more than one year (31,993,000) 13,873,000 (18,120,000)
(64,891,213) 16,673,152 (48,218,061)
Appendix IV
Definitions
The following definitions apply throughout this announcement unless the context
requires otherwise:
Act the Companies Act 1985 (as amended)
Arbuthnot Arbuthnot Securities Limited
associated undertaking the meaning given by the Act, other than paragraph 20
(1)(b) of Schedule 4A to that Act which shall be
excluded for this purpose
Australia the Commonwealth of Australia, its states,
territories or possessions and all areas subject to
its jurisdiction or any political sub-division
thereof
Board the board of directors of Merivale Moore
business day a day (other than Saturday or Sunday) on which banks
are generally open in London for normal business
Canada Canada, its possessions and territories and all areas
subject to its jurisdiction or any political
sub-division thereof
Charleswood Estates Charleswood Estates Limited
Charleswood Disposal Agreements the agreements dated 9 July 2003 between Merivale
Moore and Charleswood Estates for the sale of the
freehold interests in 81/85 Buckingham Palace Road,
London SW1 and 164 Victoria Street, London SW1 and
the long leasehold interest in 166/172 Victoria
Street, London SW1 and all related documentation
Circular the circular to be sent to Merivale Moore
Shareholders containing details of the Disposals, the
Dividend and notice of an Extraordinary General
Meeting of Merivale Moore
closing price the closing middle market quotation of a Merivale
Moore Share as derived from the London Stock Exchange
Daily Official List
Code The City Code on Takeovers and Mergers
Dean Family Interests the 3,053,849 Merivale Moore Shares held by Grenville
Dean and certain members of his immediate family to
whom the Offer will not be made
Disposals the proposed property disposals to separate
subsidiaries of Moorevale Ventures and to Charleswood
Estates, as evidenced by the Moorevale Disposal
Agreements and the Charleswood Disposal Agreements
Dividend the proposed dividend of 77 pence per Merivale Moore
Share as referred to in this announcement
Escrow Agreement the escrow agreement between, inter alios, Moorevale
Ventures, Nest Egg and Merivale Moore relating to
the Disposals
Extraordinary General Meeting the extraordinary general meeting of Merivale Moore
at which the resolutions to approve the Disposals and
the Dividend will be proposed
Form of Acceptance the form of acceptance and authority relating to the
Offer and the accompanying Offer Document
Independent Directors Mr. Ernest Chapman, Mr. Thomas Naylor and Mr. Phillip
Warner, being the directors of Merivale Moore with
the exception of Mr. Grenville Dean, Mr. Michael
Probert, Mr. William Arnold and Mr. Stephen Vickery
Japan Japan, its cities, prefectures, possessions and
territories and all areas subject to its jurisdiction
or any political sub-division thereof
LCF Rothschild LCF Rothschild Securities Limited
Listing Rules the Listing Rules of the UK Listing Authority made
under Part VI of the Financial Services and Markets
Act 2000, as amended from time to time
Loan Notes the Floating Rate Guaranteed Unsecured Loan Notes
2010 of Merivale Moore
London Stock Exchange London Stock Exchange plc
Merivale Moore Merivale Moore plc
Merivale Moore Group for the purposes of sub-paragraphs (iii),(iv), (v)
and (vi) of condition (h), Merivale Moore and its
wholly-owned subsidiaries
Merivale Moore Shares the existing unconditionally allotted or issued and
fully paid ordinary shares of 5 pence each in the
capital of Merivale Moore and any further shares
which are unconditionally allotted or issued prior to
the date on which the Offer closes (or such earlier
date or dates, as Nest Egg may, with the Panel's
consent and subject to the Code, decide)
Merivale Moore Shareholders the holders of Merivale Moore Shares
Moorevale Moorevale Limited
Moorevale Disposal Agreements the agreements dated 9 July 2003 between Merivale
Moore and certain separate subsidiaries of Moorevale
Ventures for the sale of Little Ridge Industrial
Estate (Welwyn Garden City), Middlegreen Industrial
Estate (Langley, Slough), Warwick House, 25/27
Buckingham Palace Road, (London SW1), Imperial House,
15-19 Kingsway, (London WC2), Units 1-7 Barnfield
Road (Swindon), London Road Industrial Estate
(Sawston) and Deseronto Trading Estate (Langley),
and all related documentation (including, without
limitation, the granting of long leases in relation
to certain properties)
Moorevale Ventures Moorevale Ventures Limited
Nest Egg Nest Egg Limited
Offer the recommended cash offer to be made by LCF
Rothschild on behalf of Nest Egg to acquire the
ordinary shares of Merivale Moore held by the Public
Shareholders as set out in this announcement and,
where the context admits, any subsequent revision,
variation, extension or renewal thereof
Offer Document the document to be sent to the Public Shareholders
which will contain the Offer
Panel the Panel on Takeovers and Mergers
Public Shareholders holders of Merivale Moore Shares other than Nest Egg
and holders of the Dean Family Interests
significant interest a direct or indirect interest in ten per cent. or
more of the equity share capital (as defined in the
Act)
Singapore Singapore, its possessions and territories and all
areas subject to its jurisdiction or any political
sub-division thereof
subsidiary undertaking the meaning given by the Act, other than paragraph 20
(1)(b) of Schedule 4A to that Act which shall be
excluded for this purpose
Triple Net Asset Value the consolidated net assets of Merivale Moore at the
date of computation as adjusted for: (i) valuation
surpluses at the date of computation on properties
held as current assets; (ii) the addition of negative
goodwill that will be released to the profit and loss
account on disposal of the property assets to which
it relates; (iii) contingent tax payable on the
realisation of all properties and investments at the
values at which they are stated following any
adjustments made in (i) above; and (iv) adjustments
to record financial instruments at their fair value.
Further information on the estimated Triple Net Asset
Value of a Merivale Moore Share as at 31 May 2003 is
set out in Appendix II to this announcement
Uberior Uberior Ventures Limited, a subsidiary of The
Governor and Company of the Bank of Scotland
undertaking the meaning given by the Act, other than paragraph 20
(1)(b) of Schedule 4A to that Act which shall be
excluded for this purpose
United States the United States of America, its possessions and
territories, any State of the United States of
America and the District of Columbia and all other
areas subject to its jurisdiction
UK Listing Authority the Financial Services Authority acting in its
capacity as the competent authority for the purposes
of Part VI of the Financial Services and Markets Act
2000
Warner Estate Warner Estate Holdings PLC
wider Merivale Moore Group Merivale Moore and its subsidiary undertakings,
associated undertakings and any other undertaking in
which Merivale Moore and/or such undertakings
(aggregating their interests) have a significant
interest
This information is provided by RNS
The company news service from the London Stock Exchange
END
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