10701
RNS Number : 6665D
Trinity Mirror PLC
28 October 2015
 



THIS ANNOUNCEMENT AND THE INFORMATION CONTAINED HEREIN IS RESTRICTED AND NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN WHOLE OR IN PART, DIRECTLY OR INDIRECTLY, IN OR INTO THE UNITED STATES, AUSTRALIA, CANADA, JAPAN, SOUTH AFRICA OR ANY OTHER JURISDICTION IN WHICH RELEASE, PUBLICATION OR DISTRIBUTION WOULD BE UNLAWFUL. PLEASE SEE THE IMPORTANT NOTICE AT THE END OF THIS ANNOUNCEMENT.

28 October 2015

Trinity Mirror plc

Trinity Mirror to take full ownership of Local World in transformative deal

Trinity Mirror plc ("Trinity Mirror" or the "Company") today announces the proposed acquisition of all of the shares in Local World Holdings Limited ("Local World") not already owned by the Company. The acquisition values Local World on a debt-free cash-free basis at £220 million. The purchase price for the 80.02 per cent. shareholding not already owned by Trinity Mirror is £154.4 million, being the Sellers' total share of the equity value of £193 million. Trinity Mirror will also assume debt, working capital and debt-like items of circa £27 million and will incur some £6 million of transaction costs at completion which together with the equity consideration represents total consideration of £187.4 million.

Strategic rationale

The Board believes that the Acquisition will:

·      Transform Trinity Mirror into the UK's largest regional news publisher;

·      Create a stronger and more resilient organisation enabling the Group to accelerate its strategic transformation;

·      Further enhance Trinity Mirror's digital reach. The Enlarged Group's digital portfolio would comprise a network of publishing websites delivering 120 million monthly unique browsers and 790 million monthly page views; and

·      Deliver cost synergies - c. £10 million to £12 million in the second full year of ownership.

 

The Board expects the Acquisition to be earnings enhancing in the first full year following the Acquisition.

Commenting on the Acquisition, Simon Fox, Chief Executive, Trinity Mirror plc, said:

"This is a good day for local media. Local World is a business we know and respect and by combining it with Trinity Mirror we will create an organisation of scale, with the talent and financial capacity to invest and adapt to the rapidly changing media landscape. It is a vote of confidence in local press and its future."

David Montgomery, Group CEO, Local World, said:

"Local World was founded three years ago with a clear vision to reinvigorate regional media with an unrelenting focus on our content, audience and advertisers. I am proud of what we have achieved. Local World is full of energy and talent and Trinity Mirror is acquiring a vibrant business with a strong future. I want to take this opportunity to thank everyone who has made Local World the success it is today."

Consideration and financing

The consideration for the Local World Shares to be acquired by Trinity Mirror will be payable as a combination of cash and Consideration Shares issued to the Sellers. Trinity Mirror will fund the total consideration for the Acquisition, including related transaction costs of the Company, by:

·      Utilising £67.3 million of existing cash resources;

·      Entering into a new £80 million five-year amortising debt facility;

·      Satisfying £5.3 million of consideration through the issue of 3,371,010 new ordinary shares, representing 1.3 per cent. of Trinity Mirror's existing issued ordinary share capital; and

·      Undertaking a placing of 22,398,041 new ordinary shares, representing 8.7 per cent. of Trinity Mirror's existing issued ordinary share capital to raise net proceeds of £34.8 million, announced separately today (the "Placing").

Following the Acquisition, Trinity Mirror will continue to benefit from strong cash generation providing financial flexibility for ongoing investment, potential return of capital to shareholders and continued support for Trinity Mirror's historic defined benefit pension scheme liabilities.

About Local World

Local World is one of the largest regional news publishers in the UK and was established at the end of 2012 through the acquisition of the regional publishing assets of Northcliffe Media Limited and Iliffe News & Media Limited.

Local World's print portfolio:

·      Comprises 83 print publications: 16 daily print titles, 2 Metro franchises, 36 paid weekly titles and 29 free weekly titles;

·      Has its main footprint in the South West and Wales, London and the South East, and the Midlands and the North; and

·      Includes 7 of the top 20 regional paid daily titles (by circulation) in England and Wales, which alongside Trinity Mirror's regional titles, would result in the Enlarged Group having 13 of the top 20.

Local World's digital portfolio attracts a growing digital audience with 24 million monthly unique browsers and approximately 167 million monthly page views at June 2015.

Local World generated revenue and Adjusted Operating Profit* of £221 million and £39 million in 2014.

*Adjusted Operating Profit means operating profit excluding non-recurring items, restructuring charges in respect of cost reduction measures, pension administrative expenses and the amortisation of intangible assets.

Proposed Management changes

On completion, with the exception of Simon Fox and Vijay Vaghela, all Executive and Non Executive directors will resign as directors of Local World. David Montgomery and Lisa Gordon will also leave the business shortly after completion. Rachel Addison, the Chief Operating Officer of Local World, will be promoted to the role of Managing Director, Local World, reporting to Simon Fox.

Proposed On-Sale

The Company has signed Heads of Terms with Edward Richard Iliffe ("ERI") to sell the businesses and assets of certain Local World newspaper titles located around Cambridge and Hertfordshire for a cash consideration of £15.8 million. These titles contributed £3.1 million to the Adjusted EBITDA of Local World in 2014. In the event that the Proposed On-Sale is not completed, Trinity Mirror has agreed, in certain circumstances, to pay, or procure the payment of, a break fee of £2 million to Iliffe Print Cambridge Limited (an Iliffe family company). The break fee will not be payable if the Acquisition is not completed.

Circular to Shareholders and Notice of General Meeting

Further details of the Acquisition, together with a notice convening a General Meeting on 13 November to approve the Transaction, will be contained in a circular that will be sent to shareholders today (the "Circular"). The Circular will include a recommendation from the Board of Trinity Mirror that shareholders vote in favour of the Acquisition.

Terms not defined herein shall have the same meaning as set out in the Circular.

A call and webex for analysts and shareholders will be held today at 9.30am. Conference call details are as follows: telephone number: +44(0)20 3478 5300 or 0800 279 5736; confirmation code: 3041611. The webex can be accessed at the URL: http://edge.media-server.com/m/p/j78px7zj

 

Enquiries:


Trinity Mirror plc 

 

Simon Fox, Chief Executive

Vijay Vaghela, Group Finance Director

 

020 7293 3553

 

Numis
Financial Adviser, Sponsor, Joint Bookrunner and Corporate Broker

 

Nick Westlake, Lorna Tilbian, Mark Lander, Michael Wharton

 

020 7260 1000

Barclays

Joint Bookrunner and Corporate Broker


Nicola Tennent, Stuart Jempson

 

020 3134 9801

Brunswick

Mike Smith

020 7404 5959

 



 

Trinity Mirror plc

Proposed acquisition of all of the Local World Shares not already owned by the Company

 

Background to, and reasons for, the Acquisition

Trinity Mirror's strategic objective is to deliver sustainable growth in revenue and profit. Our aim is to do so by driving the profitability and cash flow of our core publishing and printing operations whilst building our digital publishing revenues and seeking out appropriate investment opportunities, both organically and through acquisition.

Trinity Mirror's businesses operate in the rapidly evolving media sector and face a challenging trading environment which continues to place structural pressure on Trinity Mirror's print-related revenue while at the same time presenting opportunities to grow Trinity Mirror's digital revenue. The print segment continues to face challenges with paid-for newspaper sales declining and the share of print advertising declining while total advertising spend is growing. As the majority of Trinity Mirror's revenue is currently generated from print circulation and print advertising, our strategy is to ensure that declines in print revenue are minimised and ultimately offset by growth in digital revenue over the longer term.

Our goals will be delivered through four key areas of strategic focus:

1. protecting and revitalising our core brands in print;

2. growing our existing brands onto digital delivery channels;

3. continuing our relentless focus on efficiency and cost management; and

4. launching, developing, investing in or acquiring new businesses built around distinctive content or audience.

The Acquisition is an attractive opportunity which is consistent with our strategic objective and goals and firmly fits into our fourth area of strategic focus, above.

The Board of Trinity Mirror therefore believe that the Transaction will provide the following benefits to shareholders for the following reasons:

Strength of the regional publishing market

The UK has one of the most avid local newspaper readerships in the world. According to Kantar Media TGI analysis for the period April 2014 to March 2015, 44 per cent. (23 million) of the adult population in Great Britain reads a regional newspaper (source: Kantar Media UK report, 13 August 2015).

Whilst structural pressures have seen circulation volume declines for regional newspapers, the industry is still distributing an estimated 24 million copies a week, of which 15 million are paid for and 9 million are free to readers (source: Enders Analysis report 2015-032, 16 April 2015). At the same time, regional publishers are continuing to make significant traction in growing their digital news platforms - ABC figures for January to June 2015 reported a 44 per cent. year on year growth in daily unique browsers (source: ABC, June 2015). Media research firm Enders Analysis forecasts regional digital advertising revenue in aggregate to grow on a double digit basis year on year over the next four years (source: Enders Analysis report 2015-071, 13 August 2015).

Taking into account the attractions of the regional publishing industry and Trinity Mirror's efficient operating model and track record, the Directors believe that a larger regional business (in terms of audience reach, mix of print and digital media, titles and geographic footprint) combined with our national news brands represents a highly attractive platform for value generation for customers (both advertisers and readers) and shareholders alike. The Acquisition reinforces Trinity Mirror's commitment to news media and enables us to participate in a compelling business opportunity with the consolidation of strong local media brands.

The Acquisition will transform Trinity Mirror into the UK's largest regional news publisher

The Board believes that the Acquisition represents a unique opportunity to transform the scale of the Trinity Mirror Group's regional news business and is an important step towards Trinity Mirror's strategic goal of creating a multi-media business of scale by:

·      creating the largest newspaper publishing business in the UK combining both regional and national titles;

·      extending Trinity Mirror's regional business into new geographic areas;

·      incorporating a portfolio of titles and websites with strong brands and which represent a strong strategic and a complementary geographic fit with Trinity Mirror's existing portfolio of titles and websites; and

·      providing advertisers with greater reach and a more efficient footprint of regions from which to advertise to their target audiences.

Trinity Mirror believes that the combination of the two businesses to create a regional and local multimedia business of scale will provide national advertisers with access to a larger footprint of key metropolitan areas. The combined regional businesses will also be more resilient in responding to the structural challenges faced by the industry and will thereby assist in safeguarding the future of independent local news and plurality of voices. As of July 2015, Trinity Mirror's regional titles accounted for 19 per cent. of the total weekly circulation of regional and local newspapers in the UK and Ireland; collectively, after the Acquisition, the combined regional businesses will account for close to 30 per cent. of total regional and local newspapers weekly circulation in the UK and Ireland (source: Local Media Works July 2015; ABC/independently audited figures).

The Enlarged Group will have an average weekly circulation of 9 million regional newspapers comprising 36 daily newspapers, including 8 Metros outside London, 88 weekly paid for newspapers, including 5 Sunday newspapers, and 43 weekly free newspapers.

The Acquisition will further enhance our digital reach

Trinity Mirror is currently the largest regional publisher online, attracting 30 million unique browsers in June 2015. Local World has been making good progress with their digital transformation and experimenting with new revenue formats online. It reported 24 million unique browsers in June 2015, and is ranked third largest of the reported ABC regional publishers.

The Acquisition will lend considerable strength to Trinity Mirror's digital portfolio, enabling Trinity Mirror to compete more effectively with digital competitors. The Enlarged Group's digital portfolio would comprise a network of publishing websites (including national titles) delivering 120 million monthly unique browsers and 790 million monthly page views as at June 2015 with 62 per cent. of its online audience based in the UK.

The Acquisition will create a digital network of scale to sell to advertisers, enable the sharing of best practices, content and resources, across both businesses.

Local World has delivered strong financial performance

Local World was established at the end of 2012 and the business has delivered a strong financial performance over the last two years. The business delivered revenue of £231 million and £221 million in 2013 and 2014 respectively. In these two years a decline in print revenue was partly mitigated by growth in digital revenue. Further economies of scale enabled the business to reduce its cost base and as a result Adjusted Operating Profit grew from £36 million in 2013 to £39 million in 2014 despite the revenue decline. This strong performance is anticipated to continue in 2015.

Local World is pursuing a strategy to transform its business model and has continued to invest in its digital strategy. This is evident in its digital audience growth from 9 million monthly unique browsers in June 2013 to 24 million in June 2015.

Local World has strong cash flows and from Adjusted EBITDA of £39 million and £42 million in 2013 and 2014 respectively generated net operating cash flows of £34 million and £37 million, respectively. It has no historic pension deficit and has low levels of capital expenditure as the business does not own any print sites.

Local World's business is well known to Trinity Mirror and the Acquisition will enable Trinity Mirror to take full ownership of a successful investment

Trinity Mirror already holds a 19.98 per cent. holding in Local World, which was acquired for cash consideration of £14.2 million in January 2013. That initial investment has been successful, with total dividends of £15.1 million having been received from Local World over the past two years. As a consequence of our continued investment in Local World, and representation on the board of directors of Local World, Trinity Mirror is already very familiar with the Local World business. In addition, Trinity Mirror already provides printing and national advertising services to Local World.

The Acquisition will deliver cost synergies

The Enlarged Group will benefit from Trinity Mirror's track record of successful cost management, creating scope for cost synergies. Cost synergies are expected to arise through the implementation of Trinity Mirror's tight management of the cost base, by deploying know-how learned during the delivering of historic structural costs savings in Trinity Mirror's own regional businesses and through the integration and future operation of certain activities on a group-wide basis across the Enlarged Group. It is anticipated that cost savings will be achieved following the Acquisition, amounting to an annual recurring £12 million before tax from the second full year after the Acquisition (assuming the Proposed On-Sale referred to below does not complete, or £10 million per annum if it does). The cost savings are expected to accrue in the areas of content generation (£3.2 million), advertising cost of sale (£2.3 million), digital costs (£1.6 million), printing and distribution (£1.4 million), and management and central costs (£3.5 million).

It is anticipated that total non-recurring costs of £11 million will be incurred during the first and second year of ownership in order to deliver these cost savings.

The synergies identified above reflect both beneficial elements and relevant costs that will arise as a result of the Acquisition. These synergies are contingent on the Acquisition and could not be achieved by Trinity Mirror and Local World operating independently.

Information on Local World

Local World is one of the largest regional news publishers in the UK. Local World was established at the end of 2012 through the acquisition of the regional publishing assets of Northcliffe Media Limited and Iliffe News & Media Limited. These acquisitions brought strong publishing brands, efficient operations and experienced management and staff from each of Northcliffe and Iliffe together into one business of greater scale from which further efficiencies could be achieved. The assets were acquired free of historic pension deficits or obligations and without any print sites, all printing having been secured under outsourced contracts, providing Local World the opportunity to invest in digital growth and retain a high proportion of its operating cash flows.

Local World's print portfolio:

·      comprises 83 print publications: 16 daily paid titles, 2 Metro franchises, 36 paid weekly titles and 29 free weekly titles;

·      has its main footprint in the South West and Wales, London and the South East, and the Midlands and the North; and

·      Includes 7 of the top 20 regional paid daily titles (by circulation) in England and Wales, which alongside Trinity Mirror's regional titles, would result in the Enlarged Group having 13 of the top 20.

Local World's digital portfolio:

·      attracts a growing digital audience with 24 million monthly unique browsers;

·      generates approximately 167 million monthly page views; and

·      has approximately 87 per cent. of its online audience based in the UK, as at June 2015.

Local World generated £221 million of revenues and £42 million of Adjusted EBITDA in 2014. Of the total revenues, 11 per cent. are digital and these grew by 21 per cent. year on year in 2014.

Summary of the key terms of the Acquisition and the Heads of Terms

Under the terms of the Share Purchase Agreement, Trinity Mirror will (subject to the satisfaction of certain conditions) acquire all of the Local World Shares that it does not already own from the selling shareholders, who are Daily Mail and General Holdings Limited; the Honourable Edward Richard Iliffe ("ERI"); the Trustees of the 1997 A&M Funds of Lord Iliffe's Settlement Dated 1 April 1969; Torchlight Fund LP; David Montgomery; Rowanmoor Trustees Limited, re DM; Odey European Inc.; OEI MAC Inc. and Glenrinnes Farms Limited (the "Sellers") - for a purchase price based on a total indicative equity value for Local World of £193 million (which in turn has been derived from an enterprise value for Local World of £220 million, implying an Adjusted EBITDA multiple of five-times 2014 Adjusted EBITDA, less adjustments for net debt, working capital and debt like items).

Local World is of sufficient size relative to Trinity Mirror to constitute a Class 1 transaction under the Listing Rules of the Financial Conduct Authority and the Acquisition is therefore both subject to and conditional upon the approval of Trinity Mirror's shareholders. In addition, the Acquisition is conditional upon Admission of new ordinary shares under the Placing. Transaction costs of some £6 million will be incurred by Trinity Mirror in relation to the Acquisition and Placing.

Further details of the Acquisition, together with a notice convening a General Meeting on 13 November to approve the Transaction, will be contained in the Circular. The Circular will include a recommendation from the Board of Trinity Mirror that shareholders vote in favour of the Acquisition.

In connection with the Acquisition, Trinity Mirror has signed Heads of Terms with ERI, one of the Sellers, which set out the principal terms and conditions on which ERI is willing to purchase the businesses and assets of certain of the local newspaper titles currently in the Local World portfolio to be acquired by the Company pursuant to the Acquisition (the "Proposed On-Sale").

In the 52 weeks ended 28 December 2014, these businesses contributed approximately £3.1 million to the Adjusted EBITDA of Local World (approximately 7.3 per cent of the total Adjusted EBITDA of Local World in such period). As at 28 December 2014, the value of the gross assets attributable to these titles was £10.6 million (approximately 6.8 per cent. of the total gross assets of Local World as at such date).

In the event that the Proposed On-Sale is completed, it is anticipated that:

·      As a result of dis-synergies, the level of total cost synergies that will arise from the Acquisition will be reduced from an annual £12 million before tax to an annual £10 million before tax from the second full year after the Acquisition; and

 

·      the net sale proceeds will be used by the Company to repay drawings on the New Debt Facility.

 

In the event that the Proposed On-Sale is not completed, the Company has agreed to, in certain circumstances, pay, or procure the payment of, a break fee of £2 million to Iliffe Print Cambridge Limited (an Iliffe family company).

The detailed terms of the Acquisition and further details of the assets which may be acquired by ERI will be set out in the Circular.

Financial effects of the Acquisition

The Board believes that the Acquisition will generate considerable value for shareholders, with increased scale and cost synergies.

The key financial implications of the Acquisition are as follows:

·      following the Acquisition, the Enlarged Group will have a robust balance sheet with pro forma net assets of £667 million and leverage not increasing beyond one times on a pro forma basis;

·      earnings enhancing in the first full year following the Acquisition;

·      strong cash generation; and

·      recurring cost synergies will further enhance the financial strength of the Trinity Mirror Group.

Financing of the Acquisition

The consideration for the Local World Shares to be acquired by Trinity Mirror will be payable as a combination of cash and Consideration Shares issued to the Sellers. Trinity Mirror will fund the total consideration of the purchase price by utilisation of the New Debt Facility which will be fully drawn, from £61.3 million of existing cash resources and from the proceeds of the Placing, announced on 28 October 2015 and which is expected to raise net proceeds of £34.8 million.

The Company entered into a placing agreement with Numis and Barclays on 28 October 2015 (the "Placing Agreement"), pursuant to which Numis and Barclays have agreed on a reasonable endeavours basis to procure institutional placees for the Placing Shares or failing which, to take up themselves the Placing Shares, at the Placing Price (each such term as defined in the Placing Agreement). The Placing is not conditional on the Acquisition. Should the Acquisition not proceed, the Board will consider the appropriate application of the net proceeds of the Placing, but it is anticipated that they may be used to support the Trinity Mirror Group's strategic objectives, to reduce net debt or for general corporate purposes.

Current Trading and Prospects - Trinity Mirror

On 5 October 2015 Trinity Mirror released the following trading update:

"The Board continues to expect performance for the year to be in line with expectations.

Whilst the trading environment remains volatile, revenue trends have seen some improvement in the third quarter (13 weeks to 27 September 2015) with revenue falling by 9% against a 13% decline in the second quarter (13 weeks to 28 June 2015). Underlying revenue(1) fell by 7% in the third quarter compared to the 10% decline in the second quarter. On an underlying basis Publishing revenue fell by 6% with print declining by 8% and digital growing by 24%.

We continue to deliver strong growth in our digital audience(2) with average monthly unique users and page views growing by 31% and 48% respectively in the third quarter. Publishing digital revenue grew by 24% with Publishing digital display advertising revenue growing by 33%.

We have seen an improvement in trends with underlying circulation and print advertising revenue for the Publishing division falling by 5% and 16% respectively in the third quarter. This compares to underlying declines in circulation and print advertising revenues of 5% and 23% respectively in the second quarter.

We continue to make good progress against our strategic initiatives and the business continues to deliver strong cash flows and remains on track to deliver structural cost savings of £20 million for the year.

On 10 August 2015, our subsidiary MGN Limited was granted permission to appeal the judgment handed down on 21 May 2015 by Mr Justice Mann in relation to civil claims relating to phone hacking.

We can now confirm that the appeal, which has been expedited, will be heard over two days during the week commencing 19 October 2015. At this stage we cannot be specific on the timing of the outcome of the appeal.

(1)           Underlying trends exclude revenues for titles closures in the South and the newsprint supply to the Independent and i which ceased at the end of 2014. In 2014 the revenue generated by the titles closed in the South was £4.5 million and from newsprint supply to the Independent and i was £11.1million.

(2)           Average monthly unique users and page views for the Publishing division across web, mobile and apps for July to September 2015 versus July to September 2014."

MGN Limited's appeal of the judgment handed down on 21 May 2015 by Mr Justice Mann in relation to civil claims relating to phone hacking was heard by the Court of Appeal on 20 and 21 October 2015. Judgment is awaited.

Current Trading and Prospects - Local World

Local World continues to generate strong cash flows in 2015 despite continued declines in its print revenues in common with the regional newspaper industry. It has utilised these operating cash flows to continue investing in digital growth and in distributions to shareholders.

In January 2015, Local World repaid its existing loan of £10 million and signed a new £50 million bank loan, facilitating the distribution of £60 million to shareholders, through the payment of a £50 million dividend on 28 January 2015 and £10 million on 6 February 2015.

Dividend Policy of the Enlarged Group

A final dividend for 2014 of 3 pence per Ordinary Share was paid in June 2015, being the first dividend paid by Trinity Mirror since 2008. The Board has approved an interim dividend for 2015 of 2 pence per share. This will be paid on 30 November 2015 to Shareholders on the register on 2 October 2015. This is in line with the dividend policy aligned to the free cash generation of Trinity Mirror and the investment required to deliver sustainable growth in revenue and profit over the medium term. This policy will not be affected by the Acquisition. The Placing Shares and the Consideration Shares will not rank for the 2015 interim dividend.

Settlement of, and listing and dealing in, the Consideration Shares

The Consideration Shares will be issued at Completion, credited as fully paid and will rank pari passu in all respects with the Ordinary Shares, including the right to receive all dividends, distributions or any return of capital declared, made or paid after Completion, save for the interim dividend payable on 30 November 2015.

Recommendation

The Board considers the terms of the Acquisition and the Acquisition Resolution to be in the best interests of the Company and the Shareholders as a whole. Accordingly, the Board unanimously recommends that Shareholders vote in favour of the Acquisition Resolution as they intend to do in respect of their own beneficial holdings of Ordinary Shares.

EXPECTED TIMETABLE OF PRINCIPAL EVENTS

The times and dates in the table below and elsewhere are given on the basis of the Directors' current expectations and are subject to change.

 

Announcement of Acquisition and posting of circular

28 October 2015

 

 

Latest time and date for receipt of Proxy Forms

11.30 am on 11 November 2015

 

 

General Meeting

11.30 am on 13 November 2015

 

 

Completion of Acquisition

13 November 2015

 

 

Admission of, and commencement of dealings in, Consideration Shares

16 November 2015

 

 

IMPORTANT NOTICES

This announcement has been issued by, and is the sole responsibility of, Trinity Mirror.

This announcement is for information purposes only and is not intended to and does not constitute or form part of any offer or invitation to purchase or subscribe for, or any solicitation to purchase or subscribe for, Ordinary Shares, including the Consideration Shares, in any jurisdiction.

No person has been authorised to give any information or make any representations other than those contained in this announcement and, if given or made, such information or representations must not be relied upon as having been authorised by or on behalf of the Company or Numis Securities Limited ("Numis"). Neither the Company nor Numis take any responsibility or liability for, and can provide no assurance as to the reliability of, other information that you may be given. The contents of this announcement are not to be construed as legal, business or tax advice. Each Shareholder should consult their own legal adviser, financial adviser or tax adviser for legal, financial or tax advice respectively.

This announcement is not an offer of securities for sale in the United States and there will be no public offer of securities in the United States. The securities discussed herein have not been and will not be registered under the US Securities Act of 1933, as amended (the "Securities Act") or under the securities law of any state or other jurisdiction of the United States and may not be offered or sold, directly or indirectly, in or into the United States except pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act and otherwise in compliance with any applicable securities laws of any state or other jurisdiction of the United States. Neither the Ordinary Shares nor the Consideration Shares have been approved or disapproved by the US Securities and Exchange Commission, any state securities commission or any US regulatory authority, nor have such authorities reviewed or passed upon the adequacy or accuracy of this announcement. Any representation to the contrary is a criminal offence in the United States.

This announcement contains (or may contain) statements that are, or may be deemed to be, "forward-looking statements". Forward-looking statements are based on current expectations and projections about future events and other matters that are not historical fact. These forward-looking statements are sometimes identified by the use of a date in the future or forward-looking terminology, including, but not limited to, the words "aim", "anticipate", "believe", "intend", "plan", "estimate", "expect", "may", "target", "project", "will", "could" or "should" or, in each case, their negative or other variations or words of similar meaning. These forward-looking statements include matters that are not historical facts and include statements that reflect the Directors' intentions, beliefs and current expectations. By their nature, forward-looking statements involve risks and uncertainties because they relate to events and depend on circumstances that may or may not occur in the future or are beyond Trinity Mirror's control. They are not guarantees of future performance and are based on one or more assumptions.

Forward-looking statements appear in a number of places throughout this Announcement and include statements regarding the intentions, beliefs or current expectations of Trinity Mirror concerning, without limitation: current and future years' outlook; revenue and revenue trends; EBITDA; capital expenditure; shareholder returns including progressive dividends; net debt; credit ratings; Trinity Mirror's investment in print and digital media; enhancing Trinity Mirror's portfolio of print and digital businesses; the performance and growth of, and opportunities available in, regional print and digital media and Trinity Mirror's positioning to take advantage of those opportunities; expectations regarding competition, market shares, prices and growth; Trinity Mirror's possible or assumed future results of operations and/or those of its associates and joint ventures; investment plans; anticipated financial and other benefits and synergies resulting from the Acquisition, including revenue, operating cost and capital expenditure synergies; and Trinity Mirror's plans and objectives following the Acquisition.

Statements contained in this announcement regarding past trends or activities should not be taken as a representation that such trends or activities will continue in the future. Any forward-looking statements in this announcement reflect Trinity Mirror's view with respect to future events as at the date of this announcement and are subject to risks relating to future events and other risks, uncertainties and assumptions relating to the conditions to the Acquisition being satisfied, increased leverage as a result of the Acquisition, Trinity Mirror's ability to integrate the businesses and retention of key personnel, the successful realisation of the anticipated synergies and strategic benefits and an adequate return on its investment from the Acquisition, consumer behaviour, maintenance of Local World's performance and momentum in its business throughout integration and Trinity Mirror's operations, result of operations, financial condition, growth, strategy,  the industry in which Trinity Mirror operates, and the other risk factors highlighted in this announcement. No assurances can be given that the forward-looking statements in this announcement will be realised. Trinity Mirror's actual performance, results of operations, internal rate of return, financial condition, distributions to shareholders, the development of its financing strategies and the results or eventual success of the Acquisition may differ materially from the impression created by the forward-looking statements contained in this announcement. In addition, even if Trinity Mirror's actual performance, results of operations, financial condition, distributions to Shareholders and results of the Acquisition are consistent with the forward-looking statements contained in this announcement, those results or developments may not be indicative of results or developments in subsequent periods.

Forward-looking statements contained in this announcement apply only as at the date of this announcement. Subject to any obligations under the Listing Rules and the Disclosure Rules and Transparency Rules or any other applicable law or regulation, Trinity Mirror undertakes no obligation publicly to update or review any forward-looking statement, whether as a result of new information, future developments or otherwise.

Numis, which is authorised and regulated in the United Kingdom by the Financial Conduct Authority, is acting exclusively as sole sponsor, financial adviser and joint corporate broker to the Company and no one else in connection with the Acquisition, will not regard any other person (whether or not a recipient of this announcement) as a client in relation to the Acquisition and will not be responsible to anyone other than the Company for providing the protections afforded to its clients or for providing advice in relation to the Acquisition or any other transaction or arrangement referred to or contained in this announcement.

Apart from the responsibilities and liabilities, if any, which may be imposed on Numis by FSMA or the regulatory regime established thereunder, or any other applicable regulatory regime, neither Numis nor any of its affiliates accept any responsibility or liability whatsoever for, and no representation or warranty, express or implied in relation to the contents of this announcement, including its accuracy, fairness, completeness or verification, or for any other statement made or purported to be made by it, or on its behalf, in connection with the Company, the Acquisition, the Ordinary Shares or the Consideration Shares. Each of Numis and its affiliates accordingly disclaims any and all responsibility or liability whatsoever, whether arising in tort, contract or otherwise (save as referred to above), which it might otherwise have in respect of this announcement or any such statement or otherwise.

The contents of Trinity Mirror's website, the website of Local World, or any website directly or indirectly linked to any of those websites do not form part of this announcement and should not be relied upon, without prejudice to the documents incorporated by reference into this announcement.

 


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