Origin Enterprises plc ("Origin" or "the Company)
Launch of €100 million tender offer
17 October 2013
THE TENDER OFFER IS NOT BEING MADE, DIRECTLY OR INDIRECTLY, IN OR INTO, OR BY USE OF THE MAILS OF, OR BY ANY MEANS OR INSTRUMENTALITY OF INTERSTATE OR FOREIGN COMMERCE OF, OR ANY FACILITIES OF A NATIONAL SECURITIES EXCHANGE OF AUSTRALIA, CANADA, THE REPUBLIC OF SOUTH AFRICA, JAPAN OR THE UNITED STATES.
€100 million share buyback by tender offer
On 25 September 2013, Origin announced, in the Company's preliminary statement of annual results, its intention to return up to €100 million of capital to shareholders by way of a tender offer (the "Tender Offer").
Origin announces the opening, tomorrow 18 October 2013, of a share buyback by way of tender offer of up to €100 million at a price of €7.50 per Ordinary Share. The Tender Offer is subject to approval by shareholders of resolutions to be proposed at the Company's Annual General Meeting to be held on 18 November 2013 and at an Extraordinary General Meeting to be held immediately after the AGM.
BACKGROUND TO THE TENDER OFFER
On 4 July 2013 the Group announced that it had reached conditional agreement to dispose of its 50% interest in its Marine Proteins and Oils joint venture, Welcon Invest AS ("Welcon"), to its joint venture partner Austevoll Seafoods ASA, for a cash consideration of 740 million Norwegian Krone. On 12 August 2013 the Group announced the completion of the disposal and proceeds of €94 million (740 million Norwegian Krone at the then exchange rate) were received in full in cash on that date.
Since the IPO of Origin in 2007 the Group has been streamlining its operations to focus on building an integrated, intelligence led and sustainable agricultural services business that is at the heart of influencing on-farm decision making.
The disposal of the Group's 50% interest in Welcon is another significant step in that process of prioritising the development of the Group's agri-services platform. The Group is now a leading provider of value added services, technologies and strategic inputs that support primary producers in the delivery of sustainable and profitable food production solutions.
Following the disposal of the Welcon interest, the Board reviewed a number of factors including:
• the cash generative nature of the Group's operations: since the IPO in 2007 the cumulative profits after tax of the Group, amounting to €360 million, have been converted to cash;
• the Group's ongoing earnings and cash flow generation;
• the Group's optimal capital structure;
• the profile of the immediate acquisition and investment opportunities; and
• the relatively low debt of the Group at 31 July 2013.
The Board concluded that the return of up to €100 million of capital by way of the Tender Offer is in the best interests of the Group and Shareholders as a whole, as it provides Shareholders with both choice (that is, the discretion as to whether to participate in the Tender Offer) and certainty of value by providing Qualifying Shareholders who wish to sell their Ordinary Shares with an opportunity to do so at a fixed price. The Tender Offer is expected to have a positive effect on both the Company's earnings per share and dividend per share measures. As of today, the Company has satisfied itself that it has sufficient Profits Available for Distribution at the Closing Date to implement the Tender Offer.
As the Group continues to be modestly geared and cash generative, the Board will keep other opportunities to return value to shareholders under consideration.
Qualifying Shareholders who do not wish to participate in the Tender Offer can retain their full existing investment in the Company.
BENEFITS OF THE TENDER OFFER
The benefits of the Tender Offer, as compared with other available options for a return of capital to Shareholders, include:
(a) the Tender Offer provides Qualifying Shareholders who wish to sell their Ordinary Shares the opportunity to do so;
(b) Qualifying Shareholders who do not wish to receive capital at this time can maintain their full investment in the Company;
(c) the Tender Offer is available to all Qualifying Shareholders regardless of the size of their shareholdings;
(d) Qualifying Shareholders who tender their Ordinary Shares will receive a premium of 15.4 per cent. to the closing price of €6.50 per Ordinary Share on 24 September 2013 (the date before the announcement by the Company of its intention to make a tender offer) and represents a premium of 28.4 per cent to the volume weighted average price per Ordinary Share over the three month period to 24 September 2013;
(e) Qualifying Shareholders who tender their shares will receive their full entitlement to the final dividend proposed to be declared at the AGM on any Ordinary Shares tendered;
(f) Qualifying Shareholders have an equal opportunity to sell part of their respective shareholdings and to receive their respective share of the capital which the Company is seeking to return - their Guaranteed Entitlement (9.627 per cent. of their respective shareholdings);
(g) Qualifying Shareholders may also be able to participate in excess of their Guaranteed Entitlement, potentially up to their maximum shareholding in the Company, to the extent that other Qualifying Shareholders do not wish to participate in the Tender Offer in respect of their respective Guaranteed Entitlements; and
(h) the Tender Offer is expected to have a sustainable positive impact on the Company's earnings per share and dividend per share as all shares acquired under the Tender Offer will be cancelled.
DETAILS OF THE TENDER OFFER
Full details of the Tender Offer, including the terms and conditions on which it is being made, are set in a Circular to Shareholders being made available today on the Company's website www.originenterprises.com and being posted tomorrow to Qualifying Shareholders and in the Tender Form. Qualifying Shareholders do not have to tender any Ordinary Shares if they do not wish to do so.
Tenders will only be accepted at the Tender Price of €7.50. The Tender Price represents a premium of 15.4 per cent. to the closing price of €6.50 per Ordinary Share on 24 September 2013, and represents a premium of 28.4 per cent to the volume weighted average price per Ordinary Share over the three months to 24 September 2013.
The Tender Offer is conditional on:
(i) the passing of a special resolution at the AGM amending the Articles of Association of the Company, inter alia so as to facilitate tender offers;
(ii) the passing of a special resolution at the EGM to approve the tender offer;
(iii) the receipt of valid tenders in respect of at least 6,666,666 Ordinary Shares representing approximately 4.814 per cent. of the Company's Existing Issued Ordinary Share Capital by 1:00 p.m. on 21 November 2013;
(iv) the Tender Offer not having been terminated in accordance with paragraph 10 of Part III (Terms and Conditions of the Tender Offer) of the Circular to Shareholders prior to 1:00 p.m. on 21 November 2013; and
(v) the Company having sufficient Profits Available for Distribution at the Closing Date to implement the Tender Offer.
EXPECTED TIMETABLE OF PRINCIPAL EVENTS NOTE (1)
Tender Offer opens |
18 October 2013 |
Latest time and date for receipt of Forms of Proxy for Extraordinary General Meeting |
11:00 a.m. on 16 November 2013 |
Ex entitlement date for final dividend |
8:00 a.m. on 18 November 2013 |
Extraordinary General Meeting |
11:00 a.m. NOTE (2) on 18 November 2013 |
Record date for final dividend |
6:00 p.m. on 20 November 2013 |
Latest time and date for receipt of Tender Forms and TTE instructions from CREST in relation to the Tender Offer |
1:00 p.m. on 21 November 2013 |
Record date for Tender Offer |
6:00 p.m. on 21 November 2013 |
Announcement of results of the Tender Offer |
By 8:00 a.m. on 22 November 2013 |
CREST accounts credited with Ordinary Shares in respect of unsuccessful tenders |
29 November 2013 |
Payment of final dividend |
2 December 2013 |
Cheques issued/bank accounts/CREST accounts credited for Tender Offer proceeds in respect of Ordinary Shares sold |
4 December 2013 |
Share certificates issued for revised holdings of Ordinary Shares following the sale of certificated Ordinary Shares under the Tender Offer |
4 December 2013 |
Return of share certificates in respect of unsuccessful tenders |
4 December 2013 |
Notes: (1) Each of the times and dates set out above is indicative only and may be adjusted by Origin and/or Goodbody Corporate Finance, in which event details of the new times and dates will be notified, by way of an announcement issued via a Regulatory Information Service, to the Irish Stock Exchange and to the London Stock Exchange.
(2) Or as soon thereafter as the Annual General Meeting of Origin convened for 10:30 a.m. on that date shall have concluded.
If Shareholders are in any doubt as to the action they should take in relation to the Tender Offer, they are recommended to seek their own financial advice from an independent financial adviser being, if they are resident in Ireland, an organisation or firm authorised under the European Communities (Markets in Financial Instruments) Regulations 2007 (Nos. 1 to 3) or the Investment Intermediaries Act 1995 (as amended) or, if they are resident in the United Kingdom, an organisation or firm authorised pursuant to the Financial Services and Markets Act 2000 of the United Kingdom or, if they are not so resident, from another appropriately authorised independent financial adviser.
This Announcement does not constitute, or form part of, any offer for or invitation to sell or purchase any securities, or any solicitation of any offer for, securities in any jurisdiction. Any acceptance or other response to the Tender Offer should be made only on the basis of information contained in or referred to in the Circular. The Circular will contain important information, including the full terms and conditions of the Tender Offer, which shareholders are urged to read carefully.
The Tender Offer is not being made in or into, and is not capable of acceptance in or from, Australia, Canada Japan, the Republic of South Africa or the United States. Custodians, nominees and trustees should observe these restrictions and should not send or distribute documents in or into Australia, Canada, Japan, the Republic of South Africa or the United States.
ENDS
Origin Enterprises plc
Brendan Fitzgerald
Chief Financial Officer Tel: +353 (0)1 612 1259
Goodbody Corporate Finance (ESM Adviser)
Kevin Keating Tel: +353 (0) 1 667 0420
Davy (Nominated Adviser)
Ivan Murphy Tel: +353 (0) 1 679 6363
Murray Consultants
Joe Murray Tel: +353 (0) 1 498 0300
Tel: +353 (0) 86 253 4950
