AFFECTO PLC STOCK EXCHANGE RELEASE 20 JULY 2007 at 13:30 Finnish time
NOT FOR DISTRIBUTION IN THE UNITED STATES
AFFECTO PLC'S PUBLIC TENDER OFFER FOR COMPONENT SOFTWARE GROUP ASA BEGINS ON
25 JULY 2007
Affecto Plc ("Affecto") announced on 11 June 2007 its intention to launch a
public tender offer for all issued and outstanding shares in Component
Software Group ASA ("Component Software").
Affecto has previously published information concerning the offeror and the
target as well as the offer conditions of the tender offer in a stock exchange
release dated 11 June 2007. Thereafter, Affecto announced certain changes
concerning the structure of the offer price with a stock exchange release
published on 5 July 2007. These stock exchange releases are available at
Affecto's homepage www.affecto.com.
Affecto's public tender offer for Component Software's shares commences on 25
July 2007 at 9.00 and ends on 22 August 2007 at 16.30 (Norwegian time), unless
the offer period is continued or interrupted pursuant to its terms or the
tender offer is cancelled pursuant to its terms.
The offer price for one Component Software share is NOK 65.50. This
consideration consists of NOK 40.03 cash and 0.81063 Affecto shares
corresponding to NOK 25.47 (based on an agreed value of Affecto share being
31.42 per share). The consideration therefore consists of approximately 61%
cash and approximately 39% in Affecto shares.
The Oslo Stock Exchange has on 20 July 2007 accepted an English language offer
document prepared by Affecto for all issued and outstanding shares in
Component Software. Correspondingly the Finnish Financial Supervision
Authority has on 20 July 2007 accepted the prospectus prepared by Affecto,
since Affecto is issuing new shares in connection with the tender offer for
purposes of the share part of the combined share and cash consideration as
described in the paragraph above. The maximum amount of newly issued Affecto
shares shall be 4,720,630. The newly issued Affecto shares will be fully
fungible and will rank pari passu in all respects with all issued and existing
shares of Affecto.
The prospectus has been prepared in Finnish and translated into English. The
prospectus in Finnish will be available during the offer period at the service
centre of OMX Nordic Exchange Helsinki Oy, OMX Way, at Fabianinkatu 14, FI-
00130 Helsinki, Finland. The Prospectus is also available on the Company's
website at www.affecto.com. The prospectus in English is also available on SEB
Enskilda ASA's website at www.sebenskilda.no. Additional information
concerning the offer document, the prospectus and practical matters concerning
the tender offer can be obtained from the manager of the tender offer, SEB
Enskilda ASA, telephone +47 2100 8500.
The tender offer and its key conditions are described below.
General
Affecto announced on 11 June 2007 its intention to launch a tender offer for
all issued and outstanding shares in Component Software, a listed company in
Norway.
Shareholders representing approximately 67% of the share capital of Component
Software have irrevocably undertaken to accept the tender offer. The board of
directors of Component Software has on 11 June 2007 (complemented on 5 July
2007) decided to recommend that shareholders of Component Software tender
their Component Software shares to Affecto pursuant to the terms of the tender
offer.
Component Software has issued 356,428 options to its employees. All option
holders have approved the cancellation of their options against a cash
consideration. Affecto will pay NOK 25.88 for each option for the cancellation
of such options in connection with the closing of the tender offer.
At the extraordinary general meeting of shareholders held on 10 July 2007, the
shareholders of Affecto decided to authorise the board of directors to launch
a directed issue to the shareholders of Component Software and elected to the
board of directors of Affecto a new member nominated by Component Software,
M.Sc.(Econ.) Mr. Haakon Skarer since the completion of the tender offer. The
election is conditional upon the completion of the tender offer.
Affecto and Component Software concluded on 11 June 2007 a Combination
Agreement (amended on 5 July 2007) regarding the principle terms of the tender
offer, certain undertakings by Component Software relating to the conduct of
business by Component Software as well as certain other terms relating to the
tender offer.
Summary of the Terms and Conditions of the Tender Offer
Public Tender Offer
Subject to the terms and conditions included in the complete tender offer
document, Affecto offers to acquire all issued and outstanding shares in
Component Software, which are not owned by Affecto or a company belonging to
the Affecto group of companies. The offer period begins on 25 July 2007 and
ends on 22 August 2007 unless the offer period of the tender offer has been
extended in accordance with the terms and conditions of the tender offer.
The Offer Price
The offer price for each issued and outstanding Component Software share
validly tendered and not properly withdrawn in accordance with the terms and
condition of the tender offer is NOK 65.50. The consideration to the
shareholders of Component Software is given as a combined offer of cash and
Affecto shares containing NOK 40.03 cash and 0.81063 Affecto shares per each
Component Software share (where any fractional Affecto share will be paid in
cash).
For the purposes of the tender offer, the value of the Affecto share is deemed
to be NOK 31.42(EUR 3.87) per share and the EUR/NOK exchange rate is 8.1195,
the exchange rate published by the European Central Bank on 31 May 2007.
Conditions to Completion of the Tender Offer
The obligation of Affecto to consummate the tender offer is conditional upon
the satisfaction (or if permitted by applicable law, prior waiver by Affecto
in writing of the following conditions):
a) the tender offer having been accepted to such an extent that Affecto
upon completion of the purchases pursuant to the tender offer becomes the
owner of more than 90% of all shares and votes in Component Software;
b) all consents, approvals authorisations and registrations required to be
obtained from the applicable governmental entities to consummate the
transactions contemplated by the Combination Agreement having been obtained on
conditions which do not materially detract the value of the transaction
contemplated by the Combination Agreement; and any waiting period (and any
extension thereof) applicable to the consummation of the transactions under
any competition, merger control or similar law have expired or been
terminated;
c) no third party having taken or proposed to take any action which would
prevent, hinder or materially delay Affecto from implementing the tender offer
or owning and operating the assets of the Component Software group;
d) there having been no or no third party having taken any actions which
would, relative to the situation known to Affecto at the date of the signing
of the Combination Agreement, cause any material adverse change in the
business, assets or financial position of the Component Software, taken as a
whole; and
e) the Combination Agreement not having been terminated by either party.
Acquisition of Shares from Certain Shareholders of Component Software
Affecto has obtained irrevocable undertakings (each an "Irrevocable
Undertaking") from shareholders representing altogether approximately 67% of
the shares and votes in Component Software (the "Component Software Majority
Shareholders").
Pursuant to the Irrevocable Undertakings, the Component Software Majority
Shareholders have agreed to sell the Component shares held by each Component
Majority Shareholder to Affecto at a price of NOK 65.50 per share payable,
with the same terms as for others, approximately 61% in cash and approximately
39% in Affecto shares by accepting the tender offer, provided that:
a) the tender offer has not lapsed or been declared unconditional by Affecto
by 31 October 2007 or at a later date jointly agreed upon between Affecto and
Component Software, and
b) the Combination Agreement has not been terminated under a specific
termination clause; but is in force, valid and binding upon Affecto and
Component Software.
The Component Software Majority Shareholders have furthermore in the
Irrevocable Undertakings inter alia agreed not to withdraw their acceptance of
the tender offer, except pursuant to the offer not to dispose of, charge,
pledge or otherwise encumber or grant any option or other right over or
otherwise deal with any of the Shares or any interest therein (whether
conditionally or unconditionally). The Component Majority Shareholders have
undertaken to vote at the extraordinary shareholders' meeting of Component
Software to be held on 13 August 2007 in such manner as to enable the offer to
be made and become unconditional and to oppose the taking of any action which
might result in any condition of the offer not being satisfied, elect a new
board of directors, apply for delisting of the company's shares at Oslo stock
exchange and make appropriate changes in the Articles of Association and
convert Component Software to a private limited company. All these decisions
shall be made subject to the completion of the tender offer.
Following Affecto's purchase of the shares held by the Majority Shareholders,
its holding in Component Software would increase to approximately 67% and
Affecto would be obligated to make a mandatory tender offer for all shares in
Component Software in accordance with the Norwegian Securities Trading Act or
to divest the shares held by Component Software within the time prescribed by
the Norwegian Securities Trading Act.
Cash Offer Made by the Consortium Shareholders
All other shareholders in Component Software, except Majority Shareholders,
who have signed irrevocable undertakings, have the option to accept as
consideration for their Component Software shares approximately 61% in cash
and approximately 39% in Affecto shares, or alternatively to have their
consideration paid 100% in cash. This all cash offer will be made
independently by consortium of certain Component Majority Shareholders, so
that the shareholders electing the 100% cash alternative will in effect by
accepting the tender offer enter into agreements to sell their consideration
shares (Affecto shares) at the price of NOK 31.42 to this consortium of
certain Component Majority Shareholders. Therefore, the cash consideration of
such selling shareholder is NOK 65.50, which equals the amount of
consideration offered by Affecto.
The consortium consists of Norsk Vekst ASA, Norsk Vekst I AS, L.Gill
Johannessen AS, Rolv L. Jonassen AS and Rolv L. Jonassen (the "Consortium
Members"), representing 31.49% of the shares in Component Software. The
Consortium Members have undertaken to purchase such amount of consideration
shares from the other shareholders, limited to the cash consideration received
from Affecto for their shares in Component Software, and accept such amounts
of cash and consideration shares, as specified by the offeror, in accordance
with the procedure set forth above.
Norsk Vekst ASA, L. Gill Johannessen AS and Rolv L. Jonassen AS of the
consortium shareholders and Arendals Fossekompani ASA of the other
shareholders have each committed to subscribe more than 5% of the Affecto
shares.
Compulsory Acquisition and Mandatory Offer
If, as a result of the tender offer, Affecto becomes the owner of Component
Software shares representing more than 90% of the total number of shares
issued by Component Software, Affecto will have the obligation (and each
remaining Component Software shareholder will have the right to require
Affecto) to commence a compulsory acquisition for cash of the Component
Software shares not owned by Affecto pursuant to the Norwegian Public Limited
Companies Act ("Compulsory Acquisition").
Correspondingly, under the Norwegian Securities Trading Act, when Affecto as a
result of the tender offer acquires more than 40% of the shares in Component
Software, it will have an obligation to launch a mandatory offer for all
remaining Component Software shares not owned by it ("Mandatory Offer"). In
such case when Affecto gains more that 90% of the shares and votes in
Component Software pursuant the tender offer, the Mandatory Offer and the
redemption procedure can be done simultaneously in one offer document.
While the offer price under the Compulsory Acquisition under the Norwegian
Public Limited Companies Act is not stipulated, the Norwegian Securities
Trading Act says that the offer price under the Mandatory Offer must be equal
to or higher than the highest price paid or agreed to be paid by Affecto for
Component Software shares during the six month period prior to the date at
which the obligation to make such a mandatory offer is triggered.
The price to be paid in the Compulsory Acquisition to those Component Software
shareholders who do not accept the Affecto offered price will be determined by
a Norwegian court. The Norwegian court will have full discretion with respect
to evaluating the price to be paid for such Component Software shares as of
the commencement of the Compulsory Acquisition. The consideration paid by
Affecto and accepted by the acceptants pursuant to the tender offer is likely
to be among the key factors considered by such court.
To the extent that Affecto would waive the 90% condition for completing the
tender offer and would become the owner of shares and votes in Component
Software of less than 90% (but more than 40%), then in such case only rules
concerning the Mandatory Offer would be applicable.
Financing
The tender offer will be funded partly through the issue of new shares in
Affecto and partly through already negotiated loan facilities. The loan
financing is not subject to any lender's independent conditions that would be
different from Affecto's offer conditions and that would affect the
consummation of the tender offer. After the expiration of the tender offer
period, Affecto shall launch a directed new issue to the shareholders of
Component Software subject to the satisfaction or written waiver of the
conditions to complete the offer. The board of directors of Affecto will make
this directed issue pursuant to an authorisation received by the shareholders
meeting in Affecto on 10 July 2007. This directed issue will facilitate the
payment of the share part of the total consideration to the shareholders of
Component Software.
AFFECTO PLC
Pekka Eloholma
CEO
Additional information concerning the offer document, the prospectus and
practical matters concerning the tender offer can be obtained from the manager
of the tender offer, SEB Enskilda ASA, telephone +47 2100 8500.
Additional information:
Pekka Eloholma, CEO, tel. +358 205 777 737
Hannu Nyman, SVP, M&A, tel. +358 205 777 761
Disclaimer
These materials are not an offer of securities for sale in the United States.
Securities may not be offered or sold in the United States absent registration
or an exemption from registration under the U.S. Securities Act of 1933, as
amended. The issuer of the shares has not registered, and does not intend to
register, any portion of the offering in the United States and does not intend
to conduct a public offering of shares in the United States.
This document is not a prospectus and as such does not constitute an offer to
sell or the solicitation of an offer to purchase shares or rights to subscribe
for shares. Investors should not subscribe for any shares or rights referred
to in this document, or tender any shares, except on the basis of the
information contained in a prospectus or tender offer document.
This document is only being distributed to and is only directed at (i) persons
who are outside the United Kingdom or (ii) to investment professionals falling
within Article 19(5) of the Financial Services and Markets Act 2000 (Financial
Promotion) Order 2005 (the "Order") or (iii) high net worth entities, and
other persons to whom it may lawfully be communicated, falling within Article
49(2)(a) to (d) of the Order (all such persons together being referred to as
"relevant persons"). The shares are only available to, and any invitation,
offer or agreement to subscribe, purchase or otherwise acquire such securities
will be engaged in only with, relevant persons. Any person who is not a
relevant person should not act or rely on this document or any of its
contents.
This stock exchange release must not be released or distributed in whole or in
part in or into the United States, Canada, Japan or Australia. This stock
exchange release is neither an offer to purchase nor a solicitation for an
offer to sell shares, and the tender offer will not be made directly or
indirectly in the United States, Canada, Japan or Australia or any other
jurisdiction where such an offer would violate laws of that jurisdiction. This
stock exchange release and tender offer will not and may not be distributed,
forwarded or transmitted in any way, such as by post, fax, email or telephone,
or in any other way to or from areas where it would violate the law.
AFFECTO PLC'S PUBLIC TENDER OFFER FOR COMPONENT SOFTWARE GROUP ASA BEGINS ON 25 JULY 2007
| Source: Affecto Oyj