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Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
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Advance Visual | LSE:ACV | London | Ordinary Share | GB0002565355 | ORD 0.1P |
Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
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0.00 | 0.00% | 0.16 | 0.00 | 01:00:00 |
Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
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0 | 0 | N/A | 0 |
RNS No 7774j ACTIVE IMAGING PLC 24th November 1997 PART 1 This document is not for distribution in or into the United States, Canada, Australia or Japan Recommended Offers by Greig Middleton & Co. Limited on behalf of Silvermines Group PLC for the entire issued ordinary and preference share capital of Active Imaging plc The Boards of Silvermines plc ("Silvermines") and Active Imaging plc ("Active Imaging") are pleased to announce that agreement has been reached on the terms of recommended Offers on behalf of Silvermines for the whole of the issued and to be issued ordinary and preference share capital of Active Imaging. Summary of Offers * Silvermines is offering 17 New Silvermines Ordinary Shares for every 92 Active Imaging Ordinary Shares, valuing Active Imaging plc at approximately #4.5 million and each Active Imaging Ordinary Share at 9.33p. This represents a premium of approximately 16.6% over the closing price of Active Imaging Ordinary Shares on the last dealing day prior to the announcement. * Silvermines has also offered 50p in cash for each Active Imaging 'A' and 'B' Preference Share and warrants to subscribe for Silvermines' Ordinary Shares. Key Points * Active Imaging's expertise in the field of digital technology will provide Silvermines with the necessary capabilities to compete in the CCTV market as it moves from analogue to digital technology. * The acquisition provides Silvermines with the necessary technology for communications protocols and networking competence, digital image processing, digital storage and recording and digital switching technology. * Silvermines' standing in the worldwide CCTV industry will enhance the sale opportunities for Active Imaging's products. Silvermines' Chairman, Mr Bob Morton, commented on the acquisition, saying: "We are convinced that the combination of the two groups offers an excellent strategic fit and represents a sensible step forward for Silvermines as the CCTV market undergoes the transition into digital technology. This deal also fulfils Silvermines' states criteria of seeking strategic business acquisitions." Clem Jansen, Group Managing Director of Silvermines Group, said: "We have been actively pursuing the acquisition of digital technology over the last 18 months for application in our CCTV and Building Automation Division to provide us with a technological lead in these sectors. "The acquisition of Active Imaging also has synergy with the digital broadcast technology of Continental Microwave Group, which was acquired in November 1997." The Chairman of Active Imaging, Michael Brooke, commented: "I am confident that Active Imaging's businesses will prosper within the enlarged Silvermines Group. Significant synergies will result from this association, from which Active Imaging shareholders will benefit through accepting the Offers." For further enquiries, please contact: Silvermines Group plc 0116 222 2111 Clem Jansen, Group Managing Director Greig Middleton & Co Limited Rod Venables 0171 655 4000 Paul Smith 0141 240 4000 Square Mile Communications Limited 0171 583 4567 Tim Jackaman / James Melville-Ross Active Imaging plc 01628 415 440 Michael Brooke, Chairman Introduction The boards of Silvermines and Active Imaging have reached agreement today on the terms of recommended Offers to be made by Greig Middleton on behalf of Silvermines to acquire all of the issued and to be issued ordinary and preference share capital of Active Imaging ("Active Imaging Securities"). In recommending to shareholders of Active Imaging that the terms of the offers are fair and reasonable, the board of Active Imaging has been advised by Beeson Gregory Limited. In providing advice to the board of Active Imaging, Beeson Gregory Limited has taken into account the directors' commercial assessment of the Offers. Silvermines has received irrevocable undertakings to accept the Offers from the Active Imaging directors and certain other shareholders in respect of their aggregate holdings of 10,723,062 Active Imaging Ordinary Shares (representing approximately 26.01 per cent. of the Active Imaging Ordinary Shares in issue), 166,660 Active Imaging 'A' Preference Shares (representing approximately 66.67 per cent. of the Active Imaging 'A' Preference Shares in issue) and 46,667 Active Imaging 'B' Preference Shares (representing approximately 4.44 per cent. of the Active Imaging 'B' Preference Shares in issue). These undertakings are not revocable even if a higher offer is made. Furthermore, the directors of Active Imaging and certain other shareholders have each granted a call option to Silvermines in respect of their holdings of 4,634,238 Active Imaging Ordinary Shares (representing approximately 11.24 per cent. of the Active Imaging Ordinary Shares in issue). Pursuant to these call options, Silvermines may, if a third party makes an offer for Active Imaging Securities which the board of Active Imaging is advised, by Beeson Gregory, to be more favourable than any of the Offers, require the directors of Active Imaging and certain other shareholders to sell to Silvermines their holdings for consideration equal to that payable under the Active Imaging Ordinary Share Offer. In addition, 3i Group plc has indicated in writing to Silvermines that it intends to accept the Offers in respect of its aggregate holdings of 10,018,358 Active Imaging Ordinary Shares (representing approximately 24.30 per cent. of the Active Imaging Ordinary Shares in issue) and 980,000 Active Imaging 'B' Preference Shares (representing approximately 93.33 per cent. of the Active Imaging 'B' Preference Shares in issue). Neither Silvermines nor any person acting in concert with Silvermines owns or holds any rights over any Active Imaging Securities or holds any options to purchase any Active Imaging Securities with the exception of the irrevocable undertakings and call options referred to above. Based on the mid-market price of a Silvermines Ordinary Share of 50.5p (as derived from the Daily Official List of the London Stock Exchange) as at the close of business on 21 November 1997, the last dealing day prior to the announcement of the Offers, the Active Imaging Ordinary Share Offer values each Active Imaging Ordinary Share at 9.33p and the Offers value the entire issued share capital of Active Imaging at approximately #4.5 million. The offer document and relevant Forms of Acceptance are being despatched today to Active Imaging shareholders. Background to and reasons for the Offers The CCTV market is in the course of a transition from analogue to digital technology. Were Silvermines to attempt to develop digital technology of the quality to compete with the Active Imaging Group's products, the board of Silvermines believes that this process would, in all probability, be likely to take 18 months to 2 years to complete with the attendant costs and risks. Buying Active Imaging would provide Silvermines with the necessary technology for: (1) communications protocols and networking competence; (2) digital image processing, (3) digital storage and recording; and (4) digital switching technology. All of these technologies are currently utilised by the Active Imaging Group in its products which are complementary to the Silvermines Group's CCTV products. Active Imaging has recently secured substantial orders from Trafficmaster plc to deliver MvVision technology. However, further orders will depend on the market's overall perception of Active Imaging's products and their capability and the completion of development and trials in respect of the Mv 2000 and other products. Accordingly, the board of Silvermines does not expect the Active Imaging Group to make any contribution to the Enlarged Group's operating profits over the next 12 months. However, the board of Silvermines would expect to reduce substantially the Active Imaging Group's losses in the year ending 31 December 1998. In the six months to 30 June 1997, Active Imaging reported pre-tax losses of #2,886,000 and at 31 December 1996 had net assets of #3,305,000. The board of Silvermines believes that the acquisition of Active Imaging and its technology will give Silvermines Group's CCTV products added capability and that the Silvermines Group's knowledge and experience of the CCTV industry worldwide and its established distribution network will enhance the sales opportunities for the Active Imaging Group's portfolio of products. The Offers (a) The Active Imaging Ordinary Share OfferOn behalf of Silvermines, Greig Middleton & Co Limited offers to acquire, on the terms and subject to the conditions contained or referred to in the offer document and in the Blue Form of Acceptance, all of the issued and to be issued Active Imaging Ordinary Shares on the following basis: for every 92 Active 17 New Imaging Ordinary Shares Silvermines Ordinary Shares and so in proportion for any other number of Active Imaging Ordinary Shares held. (b) The Active Imaging 'A' Preference Share Offer On behalf of Silvermines, Greig Middleton & Co Limited offers to acquire, on the terms and subject to the conditions contained or referred to in the offer document and in the Pink Form of Acceptance, all of the issued and to be issued Active Imaging 'A' Preference Shares on the following basis: for each Active Imaging A' Preference Share 50p in cash and for every 2 Active Imaging 'A' Preference Shares 1 warrant to subscribe for 1 Silvermines Ordinary Share at a subscription price of 80p per share at any time on, or prior to, 31 December 1999 and so in proportion for any other number of Active Imaging 'A' Preference Shares held. (c) The Active Imaging 'B' Preference Share Offer On behalf of Silvermines, Greig Middleton & Co Limited offers to acquire, on the terms and subject to the conditions contained or referred to in the offer document and in the White Form of Acceptance, all of the issued and to be issued Active Imaging 'B' Preference Shares on the following basis: for each Active Imaging 'B' Preference Share 50p in cash and for every 2 Active Imaging 'B' Preference Shares 1 warrant to subscribe for 1 Silvermines Ordinary Share at a subscription price of 80p per share at any time on, or prior to, 31 December 1999 and so in proportion for any other number of Active Imaging 'B' Preference Shares held. Value of the Offers Based on the mid-market price of a Silvermines Ordinary Share of 50.5p as at the close of business on 21 November 1997, the last dealing day prior to the announcement of the Offers, the Active Imaging Ordinary Share Offer values each Active Imaging Ordinary Share at 9.33p and all the Active Imaging Ordinary Shares in issue at the date of this announcement at approximately #3.85 million. This represents a premium of approximately 16.6 per cent. over the closing mid-price of an Active Imaging Ordinary Share on AIM of 8p on 21 November 1997, the last dealing day prior to the announcement of the Offers. Attributing no value to the Warrants, the Active Imaging 'A' Preference Share Offer and the Active Imaging 'B' Preference Share Offer value each Active Imaging 'A' Preference Share and each Active Imaging 'B' Preference Share at 50p and all the Active Imaging 'A' Preference Shares and all the Active Imaging 'B' Preference Shares in issue at the date of this document at #124,995 and #525,000 respectively. Further details of the Offers The Active Imaging Securities will be acquired free from all liens, charges, encumbrances and other interests and together with all rights now or after the date hereof attaching thereto, including the right to receive and retain all dividends and other distributions declared, paid or made after the date hereof including, for the avoidance of doubt, the dividend payable on the Active Imaging 'A' Preference Shares on 31 December 1998 in respect of the period from 1 January 1997 to 31 December 1998. Full acceptance of the Active Imaging Ordinary Share Offer including New Silvermines Ordinary Shares to be issued following the exercise of Active Imaging Share Options previously granted over 131,675 Active Imaging Ordinary Shares would involve the issue of 7,749,532 New Silvermines Ordinary Shares representing approximately 8.44 per cent. of the enlarged issued share capital of Silvermines. Fractions of New Silvermines Ordinary Shares which would otherwise be issued under the Active Imaging Ordinary Share Offer will not be allotted to accepting Active Imaging Shareholders but will be aggregated and sold in the market and the net proceeds of sale will be distributed to the Active Imaging Shareholders entitled to them, except that amounts of #3.00 or less will be retained for the benefit of the Enlarged Group. The conditions of the Offers are set out in the Appendix below. The New Silvermines Ordinary Shares Application has been made to the Irish Stock Exchange and to the London Stock Exchange for the New Silvermines Ordinary Shares to be issued pursuant to the Active Imaging Ordinary Share Offer to be admitted to the Official Lists. The New Silvermines Ordinary Shares will be issued credited as fully paid and free from all liens, charges, encumbrances and other interests and will rank pari passu in all respects with the existing issued Silvermines Ordinary Shares save that they will not rank for the final dividend which the Silvermines directors expect to recommend in respect of the year ending 31 December 1997. The Warrants Each Warrant entitles its holder to subscribe for one Silvermines Ordinary Share at a subscription price of 80p per share payable in cash at any time on or before 31 December 1999. No application has been or will be made to the Irish Stock Exchange or to the London Stock Exchange for the Warrants to be admitted to the Official Lists, although application will be made at the appropriate time for the Silvermines Ordinary Shares that are allotted on exercise of the subscription rights conferred by the Warrants to be admitted to the Official Lists following their allotment. Information on Silvermines The Silvermines Group is an electronics and electrical group with four divisions and a 49 per cent. equity shareholding in Automotive Motion Technology Limited ("AMTL"), details of all of which are set out below. CCTV and Building Automation Division The CCTV and Building Automation Division comprises Videmech Limited, Molynx Limited, Hernis Scan Systems A/S, Molynx NV and BV and American Auto-Matrix Inc. These companies serve different segments of the CCTV and security market and together with building automation products from American Auto-Matrix can offer a total and integrated capability for these systems. In 1996 the Division's turnover was #24.76 million. Continued growth is expected from export markets in the United States of America, the Middle East and, in particular, from China, where contracts have been secured in the first half of this financial year including the China Construction Bank for CCTV and Access Control and the prestigious Astronauts Centre. Electrical Division Elequip Projects Limited ("Elequip") is the Electrical Division of Silvermines. Elequip's principal activity is the management of turnkey projects. These projects embrace all or a portion of Elequip's extensive technical capabilities, which include electrical and mechanical engineering, specialist diesel generating sets, low and high voltage distribution and motor control switchgear, electrical controls for rolling stock, electrical protection and process control systems. Elequip also provides commissioning and maintenance services. Elequip has this year continued its penetration of overseas markets and, in particular, the Middle East with the award of a #7.5 million contract to provide and manage electrical power for a gas processing plant in Egypt. Broadcast and Telecommunications Division The Broadcast and Telecommunications Division comprises Continental Microwave Limited ("CML"), RF Technology Inc., USA, Falcon Equipment & Systems Limited and Tru-Lon Printed Circuits (Royston) Limited. CML products and applications include a full range of VHF and microwave technology based equipment for broadcasts transmission; portable microwave links; longhaul network distribution links; electronic news gathering; satellite news gathering; RF Technology manufactures and markets CML products in the United States of America; Falcon which designs and manufactures electronic equipment for defence communications; and Tru-Lon Printed Circuits (Royston) Limited produces and markets prototype and pre-production run printed circuit boards. Export orders in the first half of the current financial year from all over the world but, in particular, from China, the Pacific Rim, the Middle East and South America are a feature of the growth of this business. Aerospace Division The Aerospace Division comprises the businesses of Muirhead Vactric Components Limited which includes the recently acquired avionics and accessories business from Hunting plc, Norcroft Dynamics Limited and Pickering Controls Inc., USA. This Division specialises in unique solutions from individual components to integrated systems and is focused in the aerospace, defence and industrial markets. The technology is used to direct and control high performance equipment to exacting levels of accuracy and reliability. AMTL AMTL is a joint venture company formed with Echlin Inc. (USA), a leading producer of quality automotive products worldwide, to design, develop, manufacture and sell electric motors for automotive applications. Current trading While Silvermines performed strongly in the first half of this financial year the economic problems in Silvermines' major new and expanding markets in Thailand, Malaysia, Singapore, Indonesia and Philippines, part of the Association of South East Asian Nations, and the consequent collapse in the value of their currencies, has adversely impacted on Silvermines CCTV and Building Automation businesses in this region in the second half of 1997. Furthermore, South Korea, which had remained isolated from the problems of this region and from where Silvermines had secured good business for the first 9 months of 1997, has also, very recently, suffered a decline. The directors of Silvermines are confident that trading in South East Asia will recover in due course and will remain an area of very high growth potential for its CCTV and Building Automation products. Silvermines continues to remain active in these markets helping its customers in these difficult times with the objective of not losing market share. It is not believed by the board of Silvermines that the performance of other divisions will compensate for the trading shortfall experienced in South East Asia this year. Information on Active Imaging Active Imaging was incorporated on 15 February 1996. Its shares were admitted to trading on AIM on 24 April 1996 following a placing of 4,910,714 Active Imaging Ordinary Shares at 112p per share. On 4 February 1997, TVX Inc. announced that a recommended offer would be made to acquire all the issued ordinary and preference shares in Active Imaging. The offer was withdrawn on 21 March 1997, TVX Inc. stating that this was due to adverse stock market conditions in the United States of America at that time. Following the withdrawal of that offer, a rights issue was required to meet Active Imaging's needs for immediate finance in order to continue the investment already made in the MvVision technology and to continue to establish Data Cell as a leading systems integrator and value added reseller of imaging products. Without this finance Active Imaging would have been unable to continue to trade. On 15 August 1997 Active Imaging concluded a 5 for 4 rights issue raising approximately #2 million after expenses. The Active Imaging Group develops, manufactures and markets its proprietary and jointly owned imaging products. It also operates as a value added reseller, systems integrator and supplier of third party imaging products through Data Cell. The operations of the Active Imaging Group are focused on the application and development of solutions and products for digital imaging. Its products have been sold in applications in traffic management, security and surveillance, the Internet, industrial imaging and inspection and bio-medical. Active Imaging's products The principal products developed by the Active Imaging Group centre around the use of MvVision technology. MvVision is a digital imaging capture and transmission device consisting of a video sensor, a frame grabber, a processor chip, appropriate memory and hard disk space and communications modules. All the necessary computing power is embedded directly inside the camera. It transmits images in digital format over a variety of networks. The images are automatically compressed within the device before transmission, thereby reducing the volume of data being sent and, consequently, reducing the need for transmission bandwidth. The MvVision technology has been applied by the Active Imaging Group into application areas of security and surveillance and "live" video over networks. The underlying technology is sold as MvEngine to original equipment manufacturers and to strategic partners who are well positioned in these chosen markets to integrate MvVision technology with their own applications. A major order worth #1 million has been received this year from Trafficmaster plc for MvVision technology. Deliveries commenced in October 1997 and are scheduled to finish in March 1998. A further order worth #177,000 was recently received from Trafficmaster plc. Mv2000 This product is aimed at the security and surveillance market. Based on MvVision technology it offers many of the features of MvNet Plus but offers additional capabilities in security and surveillance applications including trigger inputs for interfacing to external devices (for example, alarms) and relay outputs for controlling other external devices (for example, lighting). The device can also record digitally for subsequent playback at a remote monitoring station across a telephone or computer network. Each Mv2000 can be connected to six standard security cameras to provide cost effective surveillance and digital recording. Mv2000 has been evaluated by a number of major organisations including UK banks, UK utilities and by Aritech, a leading European manufacturer and distributor of security products. The initial units have been delivered to customers for extended trials. Production units are scheduled to be shipped before the end of 1997. In February 1997, Mv2000 won the award for the best CCTV product for 1997 from the British Security Industry Association. MvNetMvNet Plus allows "live" video to be delivered across a variety of computer and telephone networks and is available in both ethernet and modem versions. Up to five additional standard CCTV cameras can be connected to a unit. Each monitoring station can control and view multiple cameras situated at different locations. This product is fully developed. The camera can be controlled remotely and can be mounted on a pan tilt zoom mechanism. Active Imaging is now building a reseller network and dealing directly with key original equipment manufacturer accounts. Resellers, focusing on particular vertical markets, have been appointed in the United Kingdom, France and Japan. This policy is also now being followed in the United States of America. Users of MvNet Plus have included Lords cricket ground (to broadcast Test Match cricket over the Internet), the London Notting Hill Carnival (to webcast the event), various adult entertainment sites, a United Kingdom utility company to monitor power stations, a toll-bridge project in California and Smartroutes in Boston, New England, which are using a custom built MvNet Plus for traffic monitoring in their commercial SmartTraveller service. Data Cell Data Cell is a value added reseller of image acquisition hardware and related software and imaging systems. Its principal product is the "Snapper", an image acquisition board, the technology for which is jointly owned, which provides a modular approach to interfacing cameras or other video sources to industry standard computers. Snapper, when installed as part of a computer, allows images to be arranged and compressed making them available for analysis. Applications for Snapper include medical image analysis and a range of industrial and scientific applications. To date Data Cell has provided the majority of the revenue for the Active Imaging Group and is expected to continue to be a key contributor to the Active Imaging Group's revenues, particularly during the initial phase of sales generation for the MvVision products. In the first half of 1997, Data Cell's sales showed an improvement on the previous six months. Since March 1997, Data Cell has been involved in a project to develop an evidential video enhancement system. This has now received approval from the Police Scientific Development Branch; consequently it is expected that this system will become an important source of new sales during the remainder of this financial year and into 1998. Current trading As stated in the interim results announcement, an order worth approximately #1 million was received from Trafficmaster plc which utilises the MvVision technology. Deliveries of this order commenced in October and will continue into 1998 and a further order worth #177,000 was recently received from Trafficmaster plc. The months from September to date were part of a critical period in which it was necessary to secure volume orders from security integrators, original equipment manufacturers, resellers and technology partners. While orders have been received from Trafficmaster plc for Mv2000 and also for the MvNet camera, anticipated volume orders for these products have yet to be received. In addition, Data Cell sales have failed to rise to the level of earlier expectations due to delays in the placing of orders from original equipment manufacturers and lower than expected orders from the education sector. In the light of this, and with a view to reducing Active Imaging Group's costs, the board of Active Imaging intend to rationalise the operations at Active Imaging Inc. Management and employees Raymond Fagan, George Hayter, Simon Acland and Michael Brooke have indicated their intention to resign as directors of Active Imaging if the Offers become or are declared wholly unconditional. Existing employment rights of the management and employees of the Active Imaging Group, including pension and share option rights (except for share options whose exercise price is more than #1 per share), will be fully safeguarded. Active Imaging Share Options The Active Imaging Ordinary Share Offer extends to any Active Imaging Ordinary Shares which are unconditionally allotted or issued pursuant to the valid exercise of options in respect of the Active Imaging Share Option Scheme, the Data Cell Share Option Scheme and an option agreement in favour of Beeson Gregory Limited ("Active Imaging Share Options"), while the Active Imaging Ordinary Share Offer remains open for acceptance or until such earlier time and/or date as Silvermines may, subject to the City Code, decide. Appropriate proposals will be made by Silvermines in due course to the holders of Active Imaging Share Options (except for those share options whose exercise price is more than #1 per share) to the extent that they are not exercised and in the event that the Offers become or are declared unconditional in all respects. In view of the closing mid-price of an Active Imaging Ordinary Share on AIM of 8p as at 21 November 1997 (the last dealing day before the announcement of the Offers) Silvermines does not intend to make any proposal to holders of Active Imaging Share Options whose exercise price is more than #1 per share. M O R E T O F O L L O W OFFDGBBBLUDCCRX
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