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Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
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Blueheath | LSE:BLH | London | Ordinary Share | GB00B01TND9 | ORD 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% | 28.87 | 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 Number:2754W Blueheath Holdings PLC 09 May 2007 9 May 2007 Blueheath Holdings PLC ("Blueheath" or the "Company") Proposed Acquisition of Giant Topco Limited Admission of the Enlarged Share Capital to trading on AIM Change of name to Booker Group plc Approval of waiver of Rule 9 of the Takeover Code Change of Nominated Adviser and Broker The board of Blueheath today announces that it has conditionally agreed to acquire the entire issued share capital of Giant Topco Limited, the ultimate holding company of the Booker Group, through the issue of 1,344,910,958 new Ordinary Shares in Blueheath. The new company will be called Booker Group plc and will be one of the UK's leading food wholesalers with annual sales of more than #3 billion. Booker is the largest operator of cash and carry outlets in the UK, while Blueheath focuses on the delivered grocery wholesale market. The combination of the two will create an operation with the ability to serve retailers, caterers and small businesses, independents and multiple accounts - as well as providing both local "top-up" and national delivery services. The Acquisition will be treated as a reverse takeover under the AIM Rules. Upon completion of the Acquisition, the current shareholders of Giant Topco Limited will be interested in 90.01 per cent. of the Fully Diluted Enlarged Share Capital of Blueheath, with the existing Blueheath shareholders holding the remaining 9.99 per cent.. Richard Rose, Executive Chairman of Blueheath, will be the Non-Executive Chairman of the Enlarged Group while Charles Wilson, Chief Executive Officer of Booker, will be Chief Executive Officer and Jonathan Prentis, finance director of Booker, will be Chief Financial Officer. The Board also announces the appointment of Investec as Nominated Adviser and Broker to the Company with immediate effect. Richard Rose said: "We are very excited by this chance to create a dynamic new force in the UK wholesale market. This transaction will form the UK's largest food wholesaler, by combining Booker's scale, customer base, catering expertise, coverage and brands with Blueheath's technology and delivery expertise." Charles Wilson said: "Booker has made great progress in the last 18 months and this transaction gives us the opportunity to take the group to the next level. A combined Booker/Blueheath will be able to offer retailers and caterers an unrivalled service of national delivery, "top-up" delivery and Cash and Carry." For further information contact: Tulchan Communications (PR Adviser to Booker) 020-7353-4200 Susanna Voyle Celia Gordon Shute Investec (Nominated Adviser & Broker to Blueheath) 020-7597-5970 James Grace Keith Anderson Martin Smith Tom Levin There will be a call for analysts at 9.30am. For details please call Laura Pearson at Tulchan on 020-7353-4200. This summary should be read in conjunction with the full text of the Admission Document which is expected to be sent to shareholders today. The Acquisition will be subject to certain conditions including but not limited to approval of Shareholders at an EGM which is expected to be convened for this purpose on 1 June 2007. Notice of this meeting is set out in the Admission Document. Certain definitions and terms used in this Announcement are set out at the end of this announcement. Investec, which is authorised and regulated by the Financial Services Authority in the United Kingdom, is acting exclusively as Nominated Adviser and Broker to Blueheath in connection with Admission and the Acquisition and is not acting for any other person and will not be responsible to any other person for providing the protections afforded to customers of Investec or for advising on the transaction and arrangements proposed in the Admission Document. This announcement does not constitute, or form part of, an offer or invitation to purchase or subscribe for any securities in any jurisdiction. The Admission Document is expected to be published by the Company on the date of this announcement and any acquisition of New Ordinary Shares in the Company should be made only by reference to such Admission Document. This announcement contains statements about members of the Booker and Blueheath that are or may be forward-looking statements. All statements other than statements of historical facts included in this announcement may be forward-looking statements. Any statements preceded or followed by or that include the words "targets", "plans", "believes", "expects", "aims", "intends", "will", "may", "anticipates" or similar expressions or the negative thereof are forward-looking statements. Forward-looking statements include statements relating to the following: (i) future capital expenditures, expenses, revenues, economic performance, financial condition, dividend policy, losses and future prospects; (ii) business and management strategies and the expansion and growth of the Booker or Blueheath; and (iii) the effects of government regulation on Booker's or Blueheath's business. These forward-looking statements involve known and unknown risk, uncertainties and other factors which may cause the actual results, performance or achievements of any such entity, or industry results, to be materially different from any results, performance or achievements expressed or implied by such forward-looking statements. These forward-looking statements are based on numerous assumptions regarding the present and future business strategies of such entity and the environment in which each will operate in the future. Except as required by law, neither Blueheath nor any other party intends to update these forward-looking statements, even though the affairs of Blueheath and Booker will change from time to time. Notes to editors: Booker is the UK's largest cash and carry operator, offering branded and private-label goods to more than 400,000 customers, including independent convenience stores, grocers, pubs and restaurants. In the year to 31 March 2006, Booker made an operating profit before goodwill amortisation and exceptional items of approximately #22 million on turnover of approximately #3 billion. The Proposed Directors estimate that Giant Topco Limited will report turnover of not less than #3 billion and operating profit before goodwill and exceptional items of not less than #39 million for the year ended 30 March 2007. Since 2005, Booker Group has been owned by a consortium led by the Baugur Group hf. Booker Holdings' improving trend in sales EBITDA, EBIT and net debt compared to the same period in the prior financial period for the two periods ended 30 March 2007 is set out below: Period Ended 16 September 31 March 2006 15 September 30 March 2007*** 2005 2006 Turnover #m 1,467 1,570 1,430 1,579 Turnover % Change (5.9%) (5.9%) (2.5%) 0.6% EBITDA #m * 22 18 30 27 EBITDA % Change (41%) (33%) 37% 50% EBIT #m ** 13 9 22 17 EBIT % Change (54%) (44%) 69% 89% Net debt #m 361 125 70 77 Notes: * Before exceptional items. ** Before goodwill amortisation, goodwill impairment and exceptional items. *** Results are estimates and are not expected to be less than the numbers presented above. The actual results reported may be affected by revisions which could cause the actual results to differ to those estimated above. Blueheath, established in 2000, is a wholesaler offering added value software solutions to its customers. The Company offers both branded and private-label goods to more than 1,200 customers. The Company, which was admitted to trading on AIM in July 2004, operates from two UK national distribution centres in Thurrock and Wrexham. In the year to 4 March 2006, Blueheath made a pre-tax loss of approximately #4.9m on turnover of approximately #132.3m. The Acquisition is subject to approval of Blueheath's shareholders at an extraordinary general meeting, which is expected to be held on 1 June 2007. Application will be made for the Enlarged Share Capital to be admitted to trading on AIM, which is expected to become effective on 4 June 2007. Immediately prior to Admission, the Enlarged Group will be re-named Booker Group plc. Immediately following Admission shareholdings in the Enlarged Group will include: Shareholder Interest in Enlarged Share Capital immediately following Admission % Milton ehf * 35.2 Bank of Scotland 12.0 Charles Wilson ** 8.1 Kaupthing Bank hf 8.2 TBH Trading Limited 7.4 Kevin Stanford 5.0 Other Booker employee shareholders (including Booker 14.4 EBT) Notes: * Milton ehf is a Company owned by BG Holding ehf (a wholly owned subsidiary of Baugur Group hf) and Fons Eignarhaldsfelag hf ** CEO of the Enlarged Group Blueheath Holdings PLC Proposed Acquisition of Giant Topco Limited Admission of the Enlarged Share Capital to trading on AIM Change of name to Booker Group plc Approval of waiver of Rule 9 of the Takeover Code Change of Nominated Adviser and Broker The board of Blueheath announces today that Blueheath has conditionally agreed to acquire the entire issued share capital of Giant Topco Limited ("Booker Holdings") in consideration for the issue of 1,344,910,958 new Ordinary Shares in Blueheath. Upon completion of the Acquisition the shareholders of Booker Holdings will be interested in 90.01 per cent. of the Fully Diluted Enlarged Share Capital of Blueheath, with the existing Blueheath shareholders and optionholders holding the remaining 9.99 per cent.. Booker Holdings is the ultimate holding company within the Booker Group. The principal trading subsidiary of the Booker Group is Booker. Booker is the UK's largest cash and carry operator, offering branded and private-label goods which are sold to over 400,000 customers including independent convenience stores, grocers, pubs and restaurants. The Enlarged Group will be one of the UK's leading food wholesalers. The Directors and the Proposed Directors believe that it will be unique in providing both national delivery and local "top-up" services in the UK, serving both single site and multi-site customers. The Directors and the Proposed Directors believe that the Enlarged Group will be able to enhance customer service through an increased choice of both product and delivery format. Following Admission, the Enlarged Group intends to change its year end to conform with that of Booker Holdings. The Acquisition will be treated as a reverse takeover under the AIM Rules and, as such, requires the prior approval of Blueheath shareholders at the extraordinary general meeting which is expected to be convened for 11.00 a.m. on 1 June 2007 at the offices of Taylor Wessing LLP, Carmelite, 50 Victoria Embankment, Blackfriars, London, EC4Y 0DX. Irrevocable undertakings to vote in favour of the Resolutions have been received from holders of approximately 60.8 per cent. of the existing issued ordinary share capital of the Company. Should Shareholder approval be obtained, trading in the Existing Ordinary Shares will be cancelled and the Enlarged Share Capital will be admitted to trading on AIM. Application will be made for the Enlarged Share Capital to be admitted to trading on AIM, which is expected to become effective on 4 June 2007. Immediately prior to Admission, Blueheath will be renamed Booker Group plc. BG Holding ehf (a wholly owned subsidiary of Baugur Group hf), Fons Eignarhaldsfelag hf, Milton ehf, Kevin Stanford and TBH Trading Limited are deemed to be acting in concert in relation to Blueheath for the purposes of the Takeover Code. On completion of the Acquisition, the Concert Party Members will between them be interested in 707,844,210 Ordinary Shares, representing approximately 47.6 per cent. of the Company's enlarged voting share capital. The Takeover Panel has agreed, however, to waive the obligation to make a general offer that would arise on the part of the Concert Party Members, either individually or collectively, as a result of the Acquisition, subject to a Resolution being passed on a poll by Shareholders. The Board also announces the appointment of Investec as Nominated Adviser and Broker to the Company with immediate effect. Information on Blueheath Blueheath is a wholesaler of groceries to independent and multiple retail and leisure outlets within the UK. Established in 2000, Blueheath was the UK's first internet based delivered grocery wholesaler. The Blueheath offering includes both branded and private-label goods which are sold to over 1,200 customers. Blueheath's innovative IT capability enables it to offer an enhanced value service proposition to its customers and gives it an efficient, low cost delivery platform with increased stock availability whilst keeping its inventory levels low. This superior technological base enables Blueheath to differentiate itself in the marketplace. Blueheath was admitted to trading on AIM in July 2004 and trades under the RIC code "BLH". In the year ended 4 March 2006, Blueheath acquired two wholesalers, CTM Wholesale Limited and AC Ward & Son Limited for #5.7 million and #3.3 million respectively. Blueheath operates from two UK national distribution centres in Thurrock and Wrexham which, between them, have a combined area of approximately 100,000 sq ft. The Blueheath Group employed approximately 250 employees as at 4 March 2006, 68 employees as at 26 February 2005 and 63 employees as at 28 February 2004. Richard Rose and Mark Aylwin were appointed as Executive Chairman and Chief Executive Officer of Blueheath in September 2006. A strategic review of Blueheath's business followed these appointments. The results of this review, which were announced in November 2006, were that Blueheath had an inappropriate cost structure, a number of large unprofitable customers and areas of operating inefficiencies. On 26 January 2007 Blueheath announced an equity fundraising to raise #3.575 million via a placing which was supported by its largest shareholders, Schroder Investment Management Limited and Peder Smedvig Capital AS in order to strengthen its balance sheet and provide the necessary financial resources to allow the new management team to address the issues raised by the strategic review. Financial summary of Blueheath for the financial years ended 28 February 2004, 26 February 2005 and 4 March 2006 and for the 26 weeks ended 2 September 2006 The table below summarises the financial results of Blueheath and its subsidiaries for each of the financial years ended 28 February 2004, 26 February 2005 and 4 March 2006 and for the 26 weeks ended 2 September 2006 and the net assets of Blueheath as at each of those dates. Period ended 28 26 February 4 March 26 weeks February 2005 2006 ended 2 2004 September 2006 #m #m #m #m Group Turnover 62.7 70.2 132.3 77.2 Loss on ordinary (7.5) (5.8)* (4.9) (2.8) activities before taxation and exceptional items Net (liabilities)/assets (7.0) 11.6 12.5 13.7 Note * as restated The information above has been extracted without material adjustment from the published audited consolidated accounts of the Blueheath Group for the financial years ended 28 February 2004, 26 February 2005 and 4 March 2006 and from the published unaudited interim results for the 26 weeks ended 2 September 2006. In order to make a proper assessment of the financial position of Blueheath, you should not rely solely on the summary information set out above but should refer to the published annual results of Blueheath for each of the financial years ended 28 February 2004, 26 February 2005 and 4 March 2006 and the published interim results of Blueheath for the 26 weeks ended 2 September 2006. Information on the Booker Group Background and history Booker Holdings is the ultimate holding company within the Booker Group. The principal trading subsidiary of the Booker Group is Booker. Booker plc entered the UK food wholesaling market in 1957 when it acquired Alfred Button Limited. Booker expanded via organic growth and acquisition until 1997 when it reported sales of approximately #3.9 billion for the year ended 27 December 1997. In 2000 Booker plc was acquired by Iceland Group plc which was then renamed The Big Food Group plc. The Big Food Group plc was subsequently acquired by Booker Holdings in February 2005. Following the acquisition of The Big Food Group plc by Booker Holdings all the activities of The Big Food Group plc other than the cash and carry business of Booker (including the food retail business Iceland Foods Limited, Woodwards Foodservice Limited and Expert) were sold to other companies owned or controlled by certain of the Key Vendors. The results for Booker Holdings in the six months to 16 September 2005 showed a fall in sales of approximately 5.9 per cent., a fall in EBITDA of approximately 41.0 per cent. and a fall in operating profit before goodwill amortisation, goodwill impairment and exceptional items of 54.0 per cent. as compared to the same period for the prior year. On 1 November 2005 Charles Wilson joined Booker as Chief Executive Officer. In November 2005 a new senior management team was introduced and the "Booker Recovery Plan" was announced. The first phase of the plan between November 2005 and March 2006 comprised focussing the business on improving cash management and on the customer. Through tight cash control and a re-financing net debt was reduced. Head office costs were substantially reduced and supply chain costs were cut by approximately 20 per cent.. The business was simplified and the buying and selling activities were brought closer together. Stock availability was improved significantly and a new range of customer promotions introduced. By March 2006 the "focus" phase was complete with net debt reduced to approximately #125 million and the rate of profit decline was arrested. The second phase of the recovery plan between April 2006 and March 2007 involved "driving" the business through increased responsiveness to customers. Customers wanted "Choice Up, Prices Down, Better Service". Customer choice has been improved through a combination of extended ranges; more emphasis on fruit and vegetables; targeting the on-trade; improved events; and a range of "Must Stocks". Prices down has involved reducing the prices of 600 lines, improving promotions and launching "Booker Basics", a range of basic lines with an entry price ticket. Initiatives designed to improve service have focused on availability, the speed of service and the role of the branch manager. The Proposed Directors believe that these actions are working. Like for like sales to caterers declined by 5.8 per cent. in the six months to 16 September 2005 and has since then shown a consistent improvement on a half year by half year basis. Like for like sales to caterers showed an estimated increase of 3.9 per cent. for the second half of the year ended 30 March 2007. Like for like sales to retailers declined by 5.6 per cent. for the six months to 16 September 2005. Sales to retailers have also shown a consistent improvement on a half year by half year basis. Like for like sales to retailers reduced by an estimated 0.1 per cent. for the second half of the year ended 30 March 2007. As a result, the operating profit before goodwill amortisation, goodwill impairment and exceptional items for the year ended 30 March 2007 is expected to be not less than #39 million (compared to #22 million for the year ended 31 March 2006). The final phase of the recovery plan (which is ongoing) is to "Broaden" the business and is aimed at making Booker the UK's biggest and best supplier to small business. "Choice Up, Prices Down, Better Service" remains the long-term plan and there are significant opportunities for Booker to expand its existing activities. The Proposed Directors believe that growth in the Booker business will come predominantly from the following areas: * increasing sales to caterers; * the conversion of branches to the new format, "Booker Extra"; * expanding local delivery (currently approximately #489 million of sales); * continuing to expand the Premier brand and Retail Club; and * harnessing the internet as a sales and distribution channel. Current position Booker Holdings is the ultimate holding company of Booker, its principal trading subsidiary. Booker is the UK's largest cash and carry operator, offering branded and private-label goods which are sold to over 400,000 customers including independent convenience stores, grocers, pubs and restaurants. For the year to 30 March 2007, Booker Holdings had estimated sales of approximately #3.0 billion, of which approximately #2.1 billion were to retailers; #0.8 billion to caterers; and #0.1 billion to other customers (comprising schools, churches, and professional business users amongst others). Booker currently lists over 20,000 lines of product, comprising a fully comprehensive range of branded and own label grocery, fresh & frozen food, beers, wines, spirits, tobacco and non-food items. For the year ended 30 March 2007, the split of estimated sales by product category to retailers, caterers and other customers is shown below: Retailers Caterers Others Total #bn #bn #bn #bn Tobacco 1.2 0.1 - 1.3 Food and Drink 0.9 0.7 0.1 1.7 Non Food - 0.1 - 0.1 2.1 0.8 0.1 3.0 Note: Totals do not add up exactly due to rounding of numbers While tobacco accounted for approximately 42 per cent. of Booker's estimated turnover for the year ended 30 March 2007, it should be noted that the margin on tobacco sales is much lower than for other product categories. The Proposed Directors have been encouraged by the performance in the catering category which is the most profitable part of the business. In the year ended 30 March 2007, Booker delivered approximately #489 million of goods from the cash and carry branches with approximately #2.5 billion of sales made on a customer collect basis. An estimated 69 per cent. of Booker's sales in the year ended 30 March 2007 were paid for in cash at the time of purchase. Cash and Carry branches Booker currently trades from 172 branches in the UK. The average size of these branches is approximately 47,000 sq ft, although Booker has four branches over 100,000 sq ft and 12 branches under 20,000 sq ft. The Proposed Directors believe that Booker's branch portfolio is appropriate for its present requirements and is capable of handling a considerably increased level of activity. Booker has commenced a programme of refurbishment and has to date converted 8 branches into the "Extra" format. These are brighter stores with improved lighting and layout and a range that increases choice whilst avoiding unnecessary duplication. Each Extra branch has an increased proportion of non-food lines which tend to command a higher margin. Overall, the Extra stores have recorded an increase in sales and profits as compared to the non-converted portfolio. The Proposed Directors expect that a further 24 branches will be converted to the Extra format in the year ending 28 March 2008. Distribution Centres Booker operates three regional distribution centres, Hatfield and Haydock in England and Livingston in Scotland, and has a national distribution centre in Wellingborough. These distribution centres supply the cash and carry branches and have the capacity to handle retail delivery. Retailers As at 30 March 2007 Booker had approximately 74,000 retail customers. Booker offers its independent retail customers the opportunity to trade under its Premier brand which provides the benefits of a national symbol group whilst retaining the personality and entrepreneurial spirit of the independent retailer. Premier was voted symbol group of the year at the Retail Industry Awards 2006. Booker will typically subsidise the fit out of the store's fascia, signage and other imagery in return for certain minimum spend contracts and exclusive own-label supply arrangements. At 30 March 2007 there were over 2,000 Premier branded stores in the UK. Estimated sales to Premier branded stores for the year ended 30 March 2007 were approximately #470 million, an increase of approximately 10 per cent. on the prior year. Booker also offers customers the alternative of becoming a member of its Retail Club. Approximately 1,850 customers are currently Retail Club members which enables them to participate in special promotions. Estimated sales to Retail Club members for the year ended 30 March 2007 were approximately #261 million, an increase of approximately 6 per cent. on the prior year. Caterers At 30 March 2007, Booker had approximately 259,000 catering customers. This is a key area of growth as the Proposed Directors believe that the outlook for the catering market is favourable and the profitability is attractive. Brands Booker owns a number of "own label" brands including: * Chef's Larder - a leading catering brand with wholesale sales of over #120 million for the year ended 30 March 2007; * Malt House Vintners - leading wine and spirit brands with wholesale sales of over #125 million for the year ended 30 March 2007; and * Happy Shopper - a retail own label range with wholesale sales of over #50 million for the year ended 30 March 2007. Internet In the year to 30 March 2007 Booker reported estimated internet sales of approximately #48 million. Booker has recently upgraded its internet capabilities making its web site easier to use with a more efficient search capability. Employees The Booker Group employed approximately 8,431 employees as at 31 March 2006 and 8,748 employees as at 1 April 2005. Pensions The Booker Group operates a number of pension schemes. There are two defined benefit schemes, the rest are defined contribution schemes. Of the defined benefit schemes one has no present or deferred members and is in surplus, the other is the Booker Pension Scheme. This is a defined benefit scheme which is closed to new entrants and ceased to accrue benefits in respect of service after 31 July 2002. The Booker Pension Scheme had a deficit on an FRS 17 basis of #84.6 million (before taking into account any deferred tax credit) as at 31 March 2006. Since 31 March 2006, the directors of Booker have taken a number of actions to reduce the FRS 17 deficit including two offers to members of the Booker Pension Scheme to vary or buy out the rights of those members. As a result of these actions, investment returns made by the assets of the Booker Pension Scheme and contributions made by Booker, the Proposed Directors believe that the audited accounts for Booker Holdings for the year ended 30 March 2007 will show a substantially reduced FRS 17 deficit. On 24 February 2005, an agreement was made with the trustee of the Booker Pension Scheme whereby a capital payment of #35 million was made in March 2005, followed by agreed annual payments of #11.5 million in the year ended March 2006, #12.5 million in the year ended March 2007 and #14.5 million in the year ending March 2008. The next triennial valuation is due as at 31 March 2007, the results of which are expected in early 2008, following which a new funding rate will need to be agreed with the trustees. Property Booker has a total of 202 properties under lease. Of these, 172 are branch premises, 4 distribution centres and 2 office buildings. Of the remaining 24 properties, 5 are vacant and 19 are sub-let by Booker to third parties. Of the 172 "Cash and Carry" branches, 52 are properties which were part of a sale and lease back transaction concluded in February 2005 (the "2005 Properties") and 12 are properties which were part of a sale and lease back transaction concluded with AXA (the "AXA Properties"). Total current annual rent in respect of trading branches is #33,765,880 of which #10,309,766 (30.53 per cent.) was paid in respect of the 2005 Properties and #5,283,138 (15.65 per cent.) was paid in respect of the AXA Properties. The leases of the 2005 Properties are on substantially similar terms. In particular, the leases expire on the same date, 27 February 2030, and are subject to rent reviews every five years, the next rent review for each property being on 28 February 2010. Rent is reviewed on an upwards only basis at a rate equal to the higher of 2.5 per cent. of current rent compounded annually and open market rent. The leases of the AXA Properties are also on similar terms save that the rent reviews occur annually, the minimum rented increase is 3 per cent. and the leases expire on various dates between 2012 and 2037. The remaining trading branches are leased on differing terms from a number of landlords. In relation to the vacant and sub-let properties Booker has made provisions where appropriate to cover the present value of the expected costs that may arise in relation to those properties over the remaining life of the leases. Tax The Booker Group used to have operations in the United States. Those operations were disposed of during the 1990's. The United States tax position associated with the companies which carried out those operations is in the process of being resolved. The directors of Booker Holdings will make a provision of #9 million in the accounts for the year ended 30 March 2007 to cover the possible liability to taxation in the United States and/or United Kingdom. Financial summary of Booker Holdings for the two periods ended 31 March 2006 and estimate for the period ended 30 March 2007 The table below summarises the financial results of Booker Holdings for each of the two periods ended 31 March 2006 and the net assets of Booker Holdings as at each of those dates, with an estimate for group turnover, EBITDA and operating profit before goodwill amortisation and exceptional items for the period ended 30 March 2007 and an estimate of net debt as at 30 March 2007. Booker Holdings 44 week period Year Year Ended* Ended Ended*** 1 April 31 March 30 March 2005 2006 2007 Audited Audited Unaudited estimate #m #m #m Group Turnover 467.8 3,037.4 3,000.0 EBITDA (before exceptional 10.5 40.3 57.0 items) Operating profit before 7.8 21.7 39.0 goodwill amortisation, goodwill impairment and exceptional items Net debt** (401.0) (124.8) (77.0) Net assets 22.7 182.5 Notes * Booker Holdings traded for only 7 weeks in the period ended 1 April 2005. ** Net debt includes senior term loans and amounts drawn under a rolling credit facility offset by cash in transit together with loan notes and amounts payable under finance lease creditors less unamortised debt finance costs. ***Results are estimates. The actual results reported may be affected by revisions which could cause the actual results to differ to those estimated above. In order to make a proper assessment of the financial position of Booker Holdings, you should not rely solely on the summary information set out above but should read the whole of the Admission Document. The improving trend for turnover, EBITDA, EBIT and net debt compared to the same period in the prior financial period for the two periods ended 30 March 2007 is set out below: Period Ended Half Year 16 September 31 March 15 September 30 March 2005 2006 2006 2007*** #m #m #m #m Turnover #m 1,467 1,570 1,430 1,579 Turnover % Change (5.9%) (5.9%) (2.5%) 0.6% EBITDA* #m 22 18 30 27 EBITDA % Change (41%) (33%) 37% 50% EBIT** #m 13 9 22 17 EBIT % Change (54%) (44%) 69% 89% Net Debt #m 361 125 70 77 Notes * Before exceptional items ** Before goodwill amortisation, goodwill impairment and exceptional items *** Results or estimates. The actual results reported may be affected by revisions which could cause those the actual results to differ to those estimated above. Background to the Market Both Blueheath and Booker compete in the UK food supply market which includes food retailing, wholesaleing and catering. The wholesale sector can be split into Cash and Carry, Delivered Grocery and Foodservice/Catering segments. Whilst the availability of data relating to these segments is limited, the table below sets out the estimated total market size for the years ended 31 December 2004, 2005 and 2006. Year ended 31 December 2004 2005 2006 #bn #bn #bn Cash and Carry 9.5 9.3 9.4 Delivered Grocery 7.2 7.6 8.1 Food Service/Catering na 6.5 6.6 _____ _____ _____ na 23.4 24.1 Source: IGD, ACNeilsen Key Competitors The food wholesale sector is highly fragmented and the Directors and the Proposed Directors are of the opinion that the Enlarged Group will experience competition in the following areas: Cash and Carry As at the date of this document, Booker is the largest cash and carry business in the UK by sales and faces competition from three other major national brands. These are Bestway Cash & Carry, Makro and Costco. There are also a large number of regional competitors. Delivered Grocery The Delivered Grocery segment has a small number of national competitors including Palmer & Harvey, Spar and Musgrave Budgens Londis. Currently, Booker offers "top-up" delivery supplied from local cash and carry branches. Food Service / Catering Booker also competes with Brake Brothers Limited and 3663 Foodservice, Matthew Clark, Waverley TBS and a multitude of catering suppliers. Currently, Booker offers "top-up" delivery to caterers and other food service customers from local cash and carry branches. Background to and reasons for the Acquisition The Directors and Proposed Directors believe that the acquisition by Blueheath of Booker Holdings will form one of the UK's leading food wholesalers by combining Booker's scale, customer base, catering expertise, coverage and brands with Blueheath's technology and delivery expertise. The Directors and Proposed Directors expect that the Enlarged Group will benefit from improved cash management and from cost synergies. Cost synergies are expected from, inter alia, improved buying power and logistics efficiency and from central and financing costs. The Enlarged Group will serve retailers, caterers and small business and will supply single and multi-site customers. It will be the only food wholesale provider of national delivery to retail customers and local "top-up" of fresh, frozen and ambient foods, alcohol and non-foods. The Directors and Proposed Directors believe that this combination will allow the Enlarged Group to enhance customer service through a larger choice of products and delivery methods, whilst improving efficiency with the aim of becoming the UK's leading wholesaler. Principal terms of the Acquisition Blueheath will acquire the entire issued share capital of Booker Holdings in consideration for the allotment and issue of 1,344,910,958 new Ordinary Shares. The Acquisition will be effected by means of the acquisition of shares in Booker Holdings from the Key Vendors, Charles Wilson, Jonathan Prentis and the Booker EBT pursuant to a sale and purchase agreement entered into with Blueheath. The drag-along provisions in Booker Holdings' articles of association will be invoked to acquire the remaining shares in Booker Holdings on the terms set out in the Share Purchase Agreement. The Acquisition is conditional upon, inter alia, the issue of an Admission Document and notice of EGM, Shareholder approval at the EGM and Admission. Prior to Completion neither the Company nor Booker Holdings may, without consent, do anything outside the ordinary course of business, declare any dividends or other distributions or issue any shares or rights to subscribe for shares. The Key Vendors, Charles Wilson, Jonathan Prentis and the Booker EBT have also agreed not to acquire any shares in the Company. Breach of these obligations may result in termination of the Share Purchase Agreement. All the parties to the Share Purchase Agreement have given limited warranties in relation to capacity and authority. The Key Vendors, Charles Wilson, Jonathan Prentis and the Booker EBT have given warranties in relation to title to the shares being sold by them. The Board and key employees With effect from Admission: Charles Wilson and Jonathan Prentis will become Chief Executive Officer and Chief Financial Officer of the Enlarged Group; Mark Aylwin (Chief Executive Officer of Blueheath), Simon Mindham (Chief Financial Officer of Blueheath) John Hewett (Non-Executive Director of Blueheath) and Mark Naughton-Rumbo (Non-Executive Director of Blueheath) will step down from the Board; Kevin Lyon, Hans Kristian Hustad and Jim McMahon will be appointed Non-Executive Directors of the Enlarged Group; and Richard Rose will remain on the Board and will become Non-Executive Chairman. With effect from Admission, Simon Mindham will step down as Company Secretary of Blueheath and Mark Chilton will become Company Secretary of the Enlarged Group. Mark Aylwin and Simon Mindham will respectively become the Managing Director and the Finance Director of the delivered wholesale business. The details of the Proposed Directors and key employees of the Enlarged Group are set out below. Proposed Directors Richard Rose, Non-Executive Chairman (Age: 51) Richard joined Blueheath as deputy chairman in May 2006 and was appointed Executive Chairman in September 2006. It is proposed that on Completion Richard becomes Non-Executive Chairman. Richard was formerly Chief Executive Officer of Whittard of Chelsea plc, a multi site retailer of tea and coffee which was sold to an investee company of Baugur Group hf in 2006. Previously he was a Director of Hagemeyer (UK) Ltd, a distributor of professional products and services, with a UK turnover approaching #1 billion through 360 outlets. Prior to that he had been Chief Executive Officer of WF Electrical plc, a fully listed electrical distributor, where he created a substantial improvement in shareholder value. Hagemeyer purchased WF Electrical plc in 2000. He was also Non-Executive Chairman of AC Electrical Wholesale Limited where he led a very successful growth strategy resulting in a very substantial increase in shareholder value. The business was sold to Wolseley in 2006. He is Chairman of Kiotech International plc, Non-Executive Chairman of Nanoscience Inc. and Non-Executive Chairman of Felix Group plc. Charles Wilson, Chief Executive Officer (Age: 41) Charles started his career in 1986 with Procter and Gamble following which he was a consultant with OC&C Strategy Consultants and a Director of Abberton Associates. In 1998 he became an Executive Director of Booker Plc which merged with Iceland plc in 2000. In 2001 he became an Executive Director of Arcadia Group plc and in 2004 he became an Executive Director at Marks and Spencer Plc. In 2005 he was appointed as Chief Executive Officer of Booker. Jonathan Prentis, Chief Financial Officer (Age: 45) Jonathan qualified as a chartered accountant in 1987 with Deloitte & Touche. Jonathan was appointed as finance director of Booker in 2005 after the acquisition of The Big Food Group by Booker Holdings. Prior to this appointment, Jonathan was finance director of Woodward Foodservice Limited and then finance director of Group Logistics within The Big Food Group plc. Prior to 2003, Jonathan was with TDG plc. Kevin Lyon, Non-Executive Director (Age: 45) Kevin qualified as a chartered accountant in 1985. After two years in merchant banking Kevin joined the private equity and venture capital business, 3i plc. While with 3i, he built and developed several successful investment teams across the UK and led many transactions in a wide range of sectors. Kevin also held a number of leadership and management positions including Managing Director, UK Private Equity. Kevin left 3i plc in 2004 to build a portfolio of non-executive interests. Kevin is currently Chairman of a number of UK companies. Hans Kristian Hustad, Non-Executive Director (Age: 57) Hans Kristian started his career in the Norwegian food and beverage industry in the 1970's. In 1996, he started to work for one of the largest food retailers in Norway, Reitan Group Ltd., and was responsible for the launch of Rema 1000 International Ltd. on the Oslo Stock Exchange through a merger with the listed Narvesen Plc. He became a Non-Executive Director of Baugur Group when the company was launched on the Icelandic Stock Exchange in 1999. When Baugur Group hf headed the consortium which bought The Big Food Group plc in February 2005, he became Chairman and Chief Executive Officer of Booker Holdings. When Charles Wilson became Chief Executive Officer of Booker Holdings from November 2005, he continued as Non-Executive Chairman. He is a Non-Executive Director of Hamleys and Wyevale. Jim McMahon, Non-Executive Director (Age: 58) Jim is a founding partner, with Sir Tom Hunter, of West Coast Capital and has been involved in approximately #5 billion of West Coast Capital led deals since March 2001. Jim sits on a number of retail boards, including House of Fraser and Wyevale, providing strategic and financial advice. Jim was a Senior Inspector of Taxes and then spent sixteen years with PricewaterhouseCoopers where he was a Tax Partner, a member of the PwC Supervisory Board and, prior to joining West Coast Capital, headed a national team advising some of the UK's leading entrepreneurs and their businesses. Operational Management In addition to the Proposed Directors, the key personnel within the Enlarged Group that will be responsible for the operation and development of the business are: Mark Chilton Mark will be appointed as Company Secretary to the Enlarged Group following Admission. Mark qualified as a solicitor in 1987. Mark was appointed as Company Secretary of Booker Holdings in May 2006. Previously, he was head of legal at The Big Food Group plc. Prior to that, he was at The Greenalls Group Plc. Mark Aylwin Mark will be Managing Director for the delivered wholesale business of the Enlarged Group. Mark was previously supply chain and IT director at Musgrave-Budgens-Londis, a leading wholesaler to independent retailers in the UK. He has over twenty years trading, supply chain and logistics experience in the food industry, principally at Safeway where he was Commercial Director for non--foods and then Supply Chain Director. Bryan Drew Bryan will be Group Commercial Director, responsible for all buying and brands of the Enlarged Group. Bryan was at Booker plc from 1989 to 2003 when he left to co-found Hub Wholesale Ltd. He returned to Booker plc in November 2005 as Commercial Director. Simon Mindham Simon is currently Finance Director of Blueheath and will be Finance Director for the delivered wholesale business of the Enlarged Group. He qualified as a Chartered Accountant in 1990 with RSM Robson Rhodes and subsequently worked for TDG plc and the Cert Group where he held a number of finance roles including acting as Finance Director for Cert Distributors, a wholesaler of products to the independent sector. Bryn Satherley Bryn Satherley will be Group Operations Director responsible for property, IT, logistics and supply chain of the Enlarged Group. He was at Booker plc between 1999 and 2001 and rejoined in 2005. Prior to that he was at Exel plc and was on the board of Alldays Limited. Tony Overton Tony Overton will be Director for the Extra format. Tony rejoined Booker plc in 2005 having co--founded Hub Wholesale Ltd. Previously he was Managing Director of BWG Wholesale UK, a division of BWG Holdings Limited and was at Booker plc from 1992 to 2001. Warren Thomson Warren is responsible for branch operations, sales and marketing. He has worked for Booker plc for over thirty two years holding a variety of positions from branch through to Board level. Current Trading and Prospects of the Enlarged Group Blueheath On 26 January 2007 the Company announced that excellent progress had been made in remedying the areas identified in the strategic review and that the annualised level of cost savings achieved by that date amounted to approximately #3.1 million. Since that date the Company has continued to trade in line with management expectations. Booker Holdings The Directors and the Proposed Directors estimate that Booker Holdings will report sales of not less than #3 billion and operating profit, before goodwill amortisation and exceptional items of not less than #39 million for the financial year ended 30 March 2007. Sales levels in the first period of the current financial year were ahead of the same period in the prior year, whilst inventory levels and costs were in line with management expectations. Overall, Booker is currently trading in accordance with management expectations. Enlarged Group The Directors and the Proposed Directors view the Enlarged Group's trading and financial prospects with confidence. Both Blueheath and Booker Holdings intend to announce their annual results for the years ended 3 March 2007 and 30 March 2007 respectively in the two weeks following Admission. Irrevocable Undertakings Schroder Investment Management Limited, Smedvig Capital and RIT Capital Partners plc who are interested in 38,905,078 Ordinary Shares, 39,569,600 Ordinary Shares and 8,707,600 Ordinary Shares have irrevocably undertaken to the Company to vote in favour of all the Resolutions. Accordingly, irrevocable undertakings have been received from Shareholders holding approximately 60.8 per cent. in total of the Existing Ordinary Shares to vote in favour of the Resolutions. Dealing Restrictions The Key Vendors have entered into an orderly market agreement whereby they undertake to the Company and Investec not to sell or otherwise dispose of any interest in New Ordinary Shares during the Orderly Market Period, subject to certain exceptions. The Proposed Directors have agreed to the dealing restrictions described above. The Company has undertaken to Investec not to waive or vary any of those dealing restrictions prior to 1 June 2009. The Company and Investec have agreed that, if, in the four weeks following Admission, there is sufficient demand from institutional and other investors identified by Investec at a price acceptable to the Key Vendors, then the Key Vendors may dispose of approximately 225 million of the New Ordinary Shares to investors identified by Investec, however they are under no obligation to do so. Charles Wilson, Jonathan Prentis and those Booker other employees of the Booker Group who will acquire New Ordinary Shares as part of the terms of the Acquisition will be prohibited, subject to certain limited exceptions, from disposing of the New Ordinary Shares that they receive at Admission prior to 1 June 2009. In addition, and subject to certain limited exceptions, if any such person ceases to be employed by the Enlarged Group (or gives or receives notice) on or prior to 31 May 2008 his shares will be transferred to the Booker EBT at cost. Richard Rose, Mark Aylwin and Simon Mindham have also given similar undertakings that they will not prior to 1 June 2009, subject to certain limited exceptions, dispose of Ordinary Shares which they will receive following an exercise of Options under the Blueheath Senior Management Incentive Scheme. IFRS adjustments In accordance with the AIM Rules for Companies, Blueheath is required to report its results under IFRS for the accounting period commencing 4 March 2007. Following Admission, Blueheath intends to change its year end to conform with that of Booker Holdings. The Directors and the Proposed Directors believe the change from reporting results under GAAP to reporting results under IFRS may result in material changes to reported profit in the following areas: Goodwill amortisation Under IFRS goodwill is not amortised. An impairment review is performed annually to review the carrying value of the asset. The value of goodwill on the balance sheet of Booker Holdings at 31 March 2006 was #410.1 million and the value of goodwill on the Blueheath balance sheet at 2 September 2006 was #5.1 million. The amortisation charge reported in Booker Holding's consolidated financial statements for the year to 31 March 2006 was #26.8 million (excluding an impairment charge of #102.6 million). The amortisation charge reported in Blueheath's financial statements for the year to 4 March 2006 was #0.1 million. Lease incentives Under IFRS lease incentives are required to be recognised in the income and expenditure account spread throughout the period of the lease. Booker Holdings entered into a 25 year sale and leaseback transaction in February 2005. Under UK GAAP, approximately #20 million of lease incentives were being recognised over the five year period to the first rent review in February 2010. A benefit of approximately #4.0 million was therefore reported per annum under UK GAAP to the year ending March 2010. Under IFRS the benefit will be approximately #0.8 million per annum throughout the 25 year of the lease. Takeover Code Following Admission, the Concert Party will own Ordinary Shares in aggregate representing approximately 47.6 per cent. of the Enlarged Share Capital. The terms of the Acquisition give rise to certain considerations under the Takeover Code. The Takeover Code is issued and administered by the Takeover Panel. The Takeover Code is designed principally to ensure fair and equal treatment of all shareholders in relation to UK takeovers. Under Rule 9 of the Takeover Code, any person who acquires an interest (as defined in the Takeover Code) in shares which, taken together with shares in which he is already interested and in which persons acting in concert with him are interested, carry 30 per cent. or more of the voting rights of a company which is subject to the Takeover Code is normally required to make a general offer to all the remaining shareholders to acquire their shares. Similarly, when any person, together with persons acting in concert with him, is interested in shares which in the aggregate carry not less than 30 per cent. of the voting rights of such a company but not more than 50 per cent. of such voting rights, a general offer will normally be required if any further interests in shares are acquired by any such person. An offer under Rule 9 must be made in cash and at the highest price paid by the person required to make the offer, or any person acting in concert with him, for any interest in shares of the company during the 12 months prior to the announcement of the offer. BG Holding ehf, Fons Eignarhaldsfelag hf, Milton ehf, Kevin Stanford and TBH Trading Limited are deemed to be acting in concert in relation to Blueheath for the purposes of the Takeover Code. On completion of the Acquisition, the Concert Party Members will between them be interested in 707,844,210 Ordinary Shares, representing approximately 47.6 per cent. of the Company's enlarged voting share capital. As a result of the Acquisition, the Concert Party Members will between them hold interests in New Ordinary Shares carrying not less than 30 per cent. of the voting rights in the Company. The Takeover Panel has agreed, however, to waive the obligation to make a general offer that would otherwise arise on the part of the Concert Party Members as a result of the issue of Ordinary Shares to Concert Party Members, subject to the approval of Shareholders. Accordingly, Resolution 2 is being proposed at the EGM and will be taken on a poll. To be passed, Resolution 2 will require a simple majority of the votes cast. Following completion of the Acquisition the Concert Party Members will between them be interested in Ordinary Shares carrying more than 30 per cent. of the Company's voting share capital but will not hold shares carrying more than 50 per cent. of such voting rights and, for as long as they continue to be treated for the purposes of the Takeover Code as acting in concert, any further increase in that aggregate interest in shares will be subject to the provisions of Rule 9 of the Takeover Code. Dividend Policy The Proposed Directors intend to adopt a dividend policy which will reflect the long-term earnings and cashflow potential of the Enlarged Group, whilst maintaining an appropriate level of dividend cover. It is envisaged that the Enlarged Group will pay an interim and a final dividend in respect of each year. The payment of a dividend in respect of the current financial year is dependent on a number of factors including the availability of distributable reserves within the Company and finalisation of the level of contributions to the Enlarged Group's pension schemes. Corporate Governance The Proposed Directors recognise the importance of sound corporate governance. Although the Company, as a company admitted to AIM, will not be required to comply with the Combined Code, the Proposed Directors recognise that it is in the best interests of the Company and its Shareholders for the Company to comply with those principles of corporate governance in the Combined Code which are appropriate for a company of its size and nature. The Proposed Directors consider that Richard Rose, the proposed Non-Executive Chairman, is independent for the purposes of the Combined Code. Although upon Admission the Company will not comply with the Combined Code requirements regarding the number of independent directors and committee composition, it is the intention of the Proposed Directors to appoint two independent non executive directors to join the Board in due course following Admission. The Board has established with effect from Admission audit, remuneration and nomination committees comprising of Richard Rose and Kevin Lyon. Following the appointment of the two additional independent non-executive directors, the Board will review the composition of the committees. The committees have duties and responsibilities formally delegated to them by the Board. The audit committee will meet at least three times each year. The audit committee is primarily responsible for: (i) ensuring that the financial performance of the Enlarged Group is properly monitored and reported on; (ii) meeting with the auditors and reviewing reports from the auditors relating to the Enlarged Group's accounting and internal controls; (iii) reviewing the effectiveness of the Enlarged Group's systems of internal control; and (iv) agreeing the terms of appointment and remuneration of the auditors. The remuneration committee will meet at least twice a year. The remuneration committee is responsible for setting the remuneration and other terms of employment of the Company's executive officers and management and determining and reviewing any share incentive plans. The nomination committee will meet at least twice a year. The nomination committee is responsible for making recommendations on the appointment of additional directors and for reviewing the size, structure and composition of the Board and the membership of Board committees. The Proposed Directors will, following Admission, adopt a share dealing code for the Directors and the Enlarged Group's employees who have access to price sensitive information, which is appropriate for a company whose shares are admitted to trading on AIM (in order to, amongst other things, ensure compliance with Rule 21 of the AIM Rules). The Proposed Directors intend to take all reasonable steps to ensure compliance with the share dealing code by the Directors and relevant employees. Relationship Agreement The Concert Party Members have entered into a relationship agreement with the Company to regulate certain aspects of the continuing relationship between the Company and them, whereby they undertake to the Company to exercise their powers of control and voting rights in relation to the Company in accordance with the provisions of the relationship agreement, for as long as they constitute a Concert Party and together hold ordinary shares in Blueheath carrying not less than 30 per cent. of the voting rights. Admission to AIM and Dealings The Acquisition will constitute a reverse take-over under the AIM Rules and is therefore conditional upon the approval of Shareholders being given at the Extraordinary General Meeting, details of which are set out below. Application will be made for the Enlarged Share Capital to be admitted to trading on AIM and it is anticipated that Admission will become effective and that trading in the Ordinary Shares on AIM will commence on 4 June 2007. The Proposed Directors intend that, if and when appropriate, they will apply for the Company's ordinary shares to be admitted to the Official List of the UK Listing Authority and to trading on the London Stock Exchange's main market for listed securities. Extraordinary General Meeting It is anticipated that the Extraordinary General Meeting, to be held at the offices of Taylor Wessing LLP, Carmelite, 50 Victoria Embankment, Blackfriars, London EC4Y 0DX will be convened at 11.00 am on 1 June 2007, at which, the following Resolutions will be proposed: * Resolution 1 is an ordinary resolution: (a) to approve the Acquisition for the purposes of the AIM Rules; (b) to increase the authorised share capital of the Company from #2,000,000 to #20,000,000 in order to permit the issue of the New Ordinary Shares and to give the Company headroom for the future; (c) authorising the Directors under section 80 of the Act to allot: (i) the New Ordinary Shares pursuant to the terms of the Acquisition; and (ii) further new Ordinary Shares up to a nominal amount of #5,019,134, being the equivalent of approximately one-third of the Enlarged Share Capital and an amount necessary to meet the exercise of options under the Company's share incentive schemes, in accordance with industry guidelines. This authority replaces the authority given at the last Annual General Meeting of the Company and will expire on the date of the next Annual General Meeting of the Company or 15 months after the date of the passing of Resolution 1, whichever is earlier; * Resolution 2 is an ordinary resolution (which will be held on a poll) to approve the waiver by the Takeover Panel of the requirement under Rule 9 of the Takeover Code of the Concert Party to make a general offer for Blueheath; * Resolution 3 is an ordinary resolution to amend the Blueheath's Senior Management Incentive Scheme so that a reverse takeover of the Company will result in the options vesting in full in the same way as on a takeover. * Resolution 4 is a special resolution to disapply statutory pre-emption rights for: (a) any issue of new Ordinary Shares to existing Shareholders and other persons made pro rata to existing holdings and the deemed holdings of other persons entitled to participate in any such issue. Typically, this would involve a rights issue. This means that, although an issue of Ordinary Shares will be made to Blueheath shareholders and such other persons in accordance with their existing holdings (and will therefore have no dilutive effect), the directors do not have to comply with the procedural requirements of the Act; and (b) allotments for cash of Ordinary Shares up to a nominal amount of #744,200, which is equivalent to approximately 5 per cent. of the Enlarged Share Capital. Again, it is typical for an AIM quoted company to empower its directors to disapply statutory pre-emption rights in respect of a proportion of its issued share capital on an annual basis. Industry guidelines suggest that a company limit such disapplication to 5 per cent. of its issued share capital. This authority replaces the authority given at the last Annual General Meeting of the Company and will expire on the date of the next Annual General Meeting of the Company or 15 months after the date of the passing of Resolution 4, whichever is earlier; * Resolution 5 is a special resolution to adopt new Articles of Association of Blueheath, to bring them into line with current practice for a public company where shares are admitted to trading on AIM.; and * Resolution 6 is a special resolution to change the name of the Company to Booker Group plc. The Acquisition is conditional on Resolutions 1 and 2 being passed. If any of the other Resolutions are not passed, the Acquisition will proceed nevertheless. The Admission Document incorporating the notice of EGM is expected to be posted to Shareholders today. The definitions set out below have the following meanings, unless the context requires otherwise. "Act" The Companies Act 1985 (as amended) "Acquisition" The proposed acquisition by Blueheath of the entire issued share capital of Booker Holdings "Admission" The re-admission of the Existing Ordinary Shares and the admission of the New Ordinary Shares to trading on AIM becoming effective in accordance with the AIM Rules Admission Document" The Admission Document dated 9 May 2007, prepared in connection with the Flotation "AIM" The AIM market operated by the London Stock Exchange "AIM Rules" The rules published by the London Stock Exchange governing admission to, trading on and regulation and operation of AIM "Blueheath" or the "Company" Blueheath Holdings PLC, a company incorporated and registered in England and Wales with registered number 05145685 "Blueheath Group" Blueheath and its subsidiary undertakings as at the date of this document "Board" or "Directors" The board of directors of the Company "Booker" Booker Limited, a company incorporated and registered in England and Wales with registered number 00197380 and indirectly, a wholly owned subsidiary of Booker Holdings "Booker EBT" The employee benefit trust established on 25 April 2006 for the benefit of employees of the Booker Group "Booker Group" Booker Holdings and its subsidiary undertakings as at date of this announcement or any one or more of them as the context may require "Booker Holdings" Giant Topco, indirectly, the owner of 100 per cent. of the issued share capital of Booker, and the ultimate holding company of the Booker Group "Booker Pension Scheme" the Booker defined benefit pension scheme which came into operation on 1 January 1949 "Combined Code" The Combined Code on Corporate Governance appended to but not forming part of the FSA's Listing Rules published in June 2006 by the Financial Reporting Council "Completion" Completion of the Share Purchase Agreement in accordance with its terms "Concert Party" BG Holding ehf, Fons Eignarhaldsfelag hf, Milton ehf, Kevin Stanford and TBH Trading Limited (each a ''Concert Party Member'') "Enlarged Group" Blueheath and its subsidiary undertakings, including the Booker Group, following Completion or any one or more of them as the context may require "Enlarged Ordinary Share capital" or The Existing Ordinary Shares and the "Enlarged Share Capital" New Ordinary Shares immediately following Admission "Existing Ordinary Shares" The 143,488,122 Ordinary Shares in the capital of the Company in issue as at today's date "Extraordinary General Meeting" or The extraordinary general meeting of "EGM" Blueheath which is expected to be convened for 11.00 a.m. on 1 June 2007 at which the Resolutions will be proposed and any adjournment thereof "Flotation" The admission to trading of the Company's Ordinary Shares on AIM which is expected to be 4 June 2007 "FRS" The Financial Reporting Standards as issued by the Accounting Standards Boards from time to time "Fully Diluted Enlarged Share The Enlarged Share Capital plus all Capital" outstanding Options "IFRS" The International Financial Reporting standards as issued by the Board of International Standards Committee from time to time "Investec" Investec Investment Banking, a division of Investec Bank (UK) Limited "Key Vendors" Milton ehf, Kevin Stanford, TBH Trading Limited, Kaupthing Bank hf, The Governor and Company of the Bank of Scotland and Uberior Investments plc "London Stock Exchange" London Stock Exchange plc "New Ordinary Shares" The 1,344,910,958 new Ordinary Shares to be issued to shareholders of Booker Holdings pursuant to the terms of the Acquisition "Official List" The Official List of the United Kingdom Listing Authority "Options" Options over Ordinary Shares "Orderly Market Period" The period commencing on the date of Admission and ending twelve months from the date of Admission "Ordinary Shares" Ordinary shares of 1p each in the share capital of Blueheath "Pensions Regulator" The Pensions Regulator established by the Pensions Act 2004 "Proposed Directors" The proposed directors of Blueheath with effect from Admission "Resolutions" The resolutions to be proposed at the EGM (and set out in the notice of EGM) "Share Purchase Agreement"" The share purchase agreement dated 9 May 2007 between Blueheath, the Key Vendors, Charles Wilson, Jonathan Prentis and the Booker EBT pursuant to which, conditionally, inter alia, upon Admission and the passing of Resolutions 1 and 2, Blueheath has agreed to acquire the entire issued share capital of Booker Holdings "Shareholder" or "Ordinary Holder of Ordinary Shares Shareholder" ""Takeover Code" The City Code on Takeovers and Mergers "Takeover Panel" The Panel on Takeovers and Mergers "UK" or "United Kingdom" The United Kingdom of Great Britain and Northern Ireland "UK GAAP" United Kingdom Generally Accepted Accounting Principles This information is provided by RNS The company news service from the London Stock Exchange END ACQEAFSNEEDXEEE
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