The boards of Trinity Mirror and Southnews announce that they have reached agreement on the terms of a recommended cash offer, to be made by Greenhill & Co. on behalf of Trinity Mirror Regionals, a wholly-owned subsidiary of Trinity Mirror, for the whole of the issued and to be issued share capital of Southnews.
undefined The Offer will be 1200p in cash for each Southnews Share and values the whole of the issued share capital of Southnews (on a fully diluted basis) at £284.6 million
undefined The Offer represents a premium of approximately 57 per cent. over the closing middle market price of 762.5p per Southnews Share on 26 October 2000, the last business day prior to this announcement
undefined In addition, Southnews Shareholders will be entitled to retain the interim dividend of 4.85p per Southnews Share
undefined As a leading regional newspaper publisher in the South East of England, publishing weekly paid-for and free titles, Southnews represents an important opportunity for Trinity Mirror to increase substantially its exposure to this economically significant part of the UK
- the combination of Trinity Mirrorundefineds existing portfolio of weekly titles with Southnewsundefined 84 weekly paid-for and free titles will enable Trinity Mirror to offer extensive newspaper coverage of the South East of England to advertisers
- the acquisition will also give Trinity Mirrorundefineds portfolio of regional newspapers a better balance across the regional economies of the UK
undefined The board of Trinity Mirror believes that operating profit enhancements can be generated from the elimination of certain corporate and administrative overheads, the reduction of materials costs using Trinity Mirrorundefineds purchasing power and, over time, the printing of Southnewsundefined titles on Trinity Mirrorundefineds presses
undefined The board of Trinity Mirror expects these annual operating profit enhancements to amount to £4 million in the first 12 months of ownership and believes that there will be further benefits thereafter. The board of Trinity Mirror believes that the acquisition of Southnews will be earnings enhancing in 2001*
undefined Irrevocable undertakings to accept the Offer have been received from certain institutional shareholders of Southnews and Southnews Directors (and a related family trust) in respect of, in aggregate, 12,301,027 Southnews Shares, representing approximately 53.2 per cent. of Southnewsundefined issued share capital
undefined The Offer will contain a loan note alternative
undefined The Offer has the unanimous support and recommendation of the board of Southnews
Philip Graf, Chief Executive Officer of Trinity Mirror, said:
undefinedI am delighted that we have reached agreement with the board of Southnews for a recommended offer. Southnews has a tremendous portfolio of high quality newspaper titles focused on Greater London and around the M25, as well as in Essex and Kent, which will be an excellent addition to Trinity Mirrorundefineds regional and local newspaper franchises. Trinity Mirror is looking forward to working with Southnewsundefined operational management and staff to develop and expand the enlarged business in the South East of England.undefined
Gareth Clark, Chairman of Southnews, said:
undefinedSouthnews has made good and pleasing progress since its formation in 1986. Through a series of acquisitions and by launching new titles, Southnews has emerged as a substantial regional newspaper group focused on the attractive London and Home Counties market. Though we have identified further opportunities for developing the company, the recent consolidation within the newspaper industry has undoubtedly diminished the range of suitable opportunities previously open to Southnews. With this in mind, I am therefore convinced that the correct route to ensure the continued long term prosperity of our newspapers is by them now forming part of a larger newspaper group.undefined
This summary should be read in conjunction with and in the context of the full text of this announcement. A presentation to analysts will be held at 9:30 a.m. today at The Brewery, Chiswell Street, London EC1Y 4SD.
* This statement should not be taken to mean that the future earnings per share of Trinity Mirror, as enlarged by the acquisition of Southnews, will necessarily be greater than its historical earnings per share.
The Offer (including the Loan Note Alternative) will not be made, directly or indirectly, in or into the United States, Canada, Japan or Australia. Accordingly, copies of this announcement are not being, and must not be, mailed or otherwise distributed or sent into or from the United States, Canada, Japan or Australia.
The Loan Notes will not be listed on any stock exchange and have not been, and will not be, registered under the Securities Act or under any relevant securities laws of any State of the United States and the relevant clearances have not been, and will not be, obtained from the regulatory authority of any province or territory of Canada. In addition, no prospectus in relation to the Loan Notes has been, or will be, lodged with or registered by the Australian Securities and Investments Commission and no steps have been, nor will be, taken to enable the Loan Notes to be offered in compliance with the applicable securities laws of Japan or any other country or jurisdiction outside the United Kingdom. The Loan Notes will not be offered, sold, resold, delivered or distributed, directly or indirectly, in or into the United States, Canada, Japan or Australia or any other jurisdiction if to do so would constitute a violation of the relevant laws in such jurisdiction.
Greenhill & Co., which is regulated in the United Kingdom by The Securities and Futures Authority Limited, is acting for Trinity Mirror and Trinity Mirror Regionals and for no one else in relation to the Offer and will not be responsible to anyone other than Trinity Mirror and Trinity Mirror Regionals for providing the protections afforded to customers of Greenhill & Co. nor for providing advice in relation to the Offer.
HSBC, which is regulated in the United Kingdom by The Securities and Futures Authority Limited, is acting for Southnews and for no one else in relation to the Offer and will not be responsible to anyone other than Southnews for providing the protections afforded to customers of HSBC nor for providing advice in relation to the Offer.
