REG - Betfair Group PLC Paddy Power plc - Rule 2.7 Announcement <Origin Href="QuoteRef">BETF.L</Origin> <Origin Href="QuoteRef">PLSA.I</Origin> - Part 4
08/09/2015 07:02
- Part 4: For the preceding part double click ID:nRSH3714Yc
contributions arising from the exercise or
vesting of options and/or awards over Betfair Shares.
Part B: Irrevocable undertakings in respect of Paddy Power Shares
The following persons have given irrevocable undertakings to vote (or procure
the vote) in favour of the resolutions to be proposed at the Paddy Power
General Meeting in relation to the following Paddy Power Shares:
Andy McCue 21,938 0.050% 74,402
Cormac McCarthy 16,443 0.037% 51,660
Michael Cawley 3,600 0.008% -
Tom Grace - - -
Danuta Gray - - -
Ulric Jerome - - -
Stewart Kenny 354,651 0.805% -
Gary McGann 610 0.001% -
Pádraig Ó Ríordáin 7,200 0.016% -
TOTAL 404,442 0.918% 126,062
TOTAL
404,442
0.918%
126,062
Paddy Power has received irrevocable undertakings from the Paddy Power
Directors, in respect of their own beneficial holdings of Paddy Power Shares,
representing approximately 0.918 per cent. of the existing issued ordinary
share capital of Paddy Power to vote or procure the vote in favour of each of
the resolutions to be proposed at the Paddy Power General Meeting.
The irrevocable undertakings referred to above will lapse if:
(a) the Scheme lapses or is withdrawn in accordance with its terms and
Paddy Power publicly confirms that it does not intend to proceed with the
Merger or to implement the Merger by way of a Merger Offer or otherwise or if
Paddy Power exercises its right to implement the Merger by way of a Merger
Offer, the Merger Offer lapses or is withdrawn in accordance with its terms
and Paddy Power subsequently confirms that it does not intend to proceed with
the Merger;
(b) the Scheme has not become effective (or, if applicable, the Offer
has not become or been declared unconditional in all respects) by 30 June 2016
(or such later date as agreed between Paddy Power and Betfair with the
approval of the Court and/or the Panel, if required); or
(c) Paddy Power announces, with the consent of the Panel, that it does
not intend to make or proceed with the Merger and no new, revised or
replacement Scheme or Merger Offer on substantially the same or better terms
is announced in accordance with Rule 2.7 of the Code at the same time.
APPENDIX IV
QUANTIFIED FINANCIAL BENEFITS STATEMENT
Part A
Paragraph 3 of this Announcement includes statements of estimated cost savings
and synergies arising from the Merger (together, the "Quantified Financial
Benefits Statement").
A copy of the Quantified Financial Benefits Statement is set out below:
"Following preliminary analysis undertaken by the Boards of Paddy Power and
Betfair, significant cost and revenue synergies have been identified which
reinforce the strategic rationale for the Merger and the significant value
creation opportunity for shareholders. The key driver of the identified
synergies is the efficiencies that the Merger enables given the complementary
nature of the businesses and the ability to build on the Combined Group's
broad product offering.
The synergies have been identified through applying a set of key integration
principles when considering the Combined Group. These principles comprise:
• dual European brands but more focused positioning on their key
target audiences;
• integrating technology;
• creating a shared operations team; and
• combining the existing corporate functions into a single corporate
function.
In this context, the Boards believe that the Combined Group will be able to
achieve recurring annual pre-tax cost synergies of approximately £50 million
and expect these to be delivered progressively, minimising risk, over two
years following Completion. It is expected that the benefit of the full level
of identified synergies will be achieved in the third full year following
Completion. A one-off cash integration cost of approximately £65 million (1.3x
the level of run rate synergies) is expected to be incurred in delivering the
cost synergies. Other than the integration costs identified, the Boards of
Paddy Power and Betfair do not expect any dis-synergies to arise as a result
of the Merger.
In addition to the quantified synergies identified above, the Boards of Paddy
Power and Betfair believe in a significant opportunity for revenue synergies,
predominantly through leveraging the Combined Group's enlarged scale and
capabilities to drive better customer acquisition and retention that will
increase returns on product and marketing investment and increase payback
across existing and new markets.
The statements above of estimated cost synergies relate to future actions and
circumstances which inherently involve risks, uncertainties and contingencies.
Accordingly, the cost synergies referred to may not be achieved, may not be
achieved within the time periods specified or may be achieved in a different
form to that which is currently envisaged by the Boards of Paddy Power and
Betfair. For the purposes of Rule 28 of the Code, the statements above of
estimated cost synergies are the responsibility of the Directors of Paddy
Power, in their capacity as directors of the offeror under the terms of the
Merger. Appendix IV includes reports in connection with the synergy statements
from KPMG and Morgan Stanley, as required pursuant to the Code. KPMG and
Morgan Stanley have given and not withdrawn their consent to the publication
of their reports in the form and context in which they are included. These
statements are not intended as a profit forecast and should not be interpreted
as such."
The potential sources of the recurring annual pre-tax cost synergies of
approximately £50 million identified by the Boards of Paddy Power and Betfair
include:
• synergies in commercial and marketing areas generated through
efficiencies in brand spend and agency fees and rationalising certain
operational and support functions;
• synergies in IT, product development and other operational areas
driven by optimising infrastructure, trading platforms, product design,
development and data costs; and
• removal of duplication across general corporate overheads and
facilities.
Bases of belief
Prior to the announcement of the possible merger on 26 August 2015,
discussions were held between senior finance, commercial and strategy
personnel at Paddy Power and Betfair for the purposes of enabling the
respective teams to quantify their initial estimates of potential synergies
and associated costs available from the Merger. As part of this process, the
Paddy Power and Betfair teams established a proposed framework operating model
through which each team could refine their respective estimates of cost
synergies.
Following the announcement of the possible merger on 26 August 2015, the Paddy
Power and Betfair teams aligned their respective analyses into a combined set
of cost synergies estimates, details of which are set out in the Appendix IV
and in paragraph 3 of this Announcement. The Paddy Power and Betfair teams
have continued to refine and test their analysis with the relevant functional
heads and other personnel at Paddy Power and Betfair to assess the nature and
quantum of their estimates of the identified cost synergies available as a
result of the Merger.
In preparing the Quantified Financial Benefits Statement, both Paddy Power and
Betfair have shared certain operating and financial information to facilitate
a detailed analysis in support of evaluating the potential cost synergies
available from the Merger. In circumstances where data has been limited for
commercial or other reasons, the team has made estimates and assumptions to
aid its development of individual synergy initiatives.
The cost bases used as the basis for the quantification exercise are:
• in respect of Paddy Power, the seven months actual cost base to 31
July 2015 plus five months of the latest forecast cost base to 31 December
2015; and
• in respect of Betfair, the three months actual cost base to 31
July 2015 plus nine months of the latest forecast cost base to 30 April 2016.
The exchange rate used to convert between:
• EUR and GBP is 0.77; and
• AUD and GBP is 1.46.
Reports
As required by Rule 28.1(a) of the Code, KPMG, as reporting accountants to
Paddy Power, have provided a report stating that, in their opinion, the
Quantified Financial Benefits Statement has been properly compiled on the
basis stated. In addition Morgan Stanley, as financial adviser to Paddy Power,
has provided a report stating that, in its opinion, the Quantified Financial
Benefits Statement has been prepared with due care and consideration.
Copies of these reports are included in Parts B and C of this Appendix IV.
KPMG and Morgan Stanley have given and not withdrawn their consent to the
publication of their reports in the form and context in which they are
included.
Notes
1. The statements of estimated cost synergies relate to future actions
and circumstances which, by their nature, involve risks, uncertainties and
contingencies. As a result, the cost synergies referred to may not be
achieved, or may be achieved later or sooner than estimated, or those achieved
could be materially different from those estimated. No statement in the
Quantified Financial Benefits Statement, or this Announcement generally,
should be construed as a profit forecast (other than the Paddy Power Profit
Forecast) or interpreted to mean that the Combined Group's earnings in the
first full year following the Merger, or in any subsequent period, would
necessarily match or be greater than or be less than those of Paddy Power
and/or Betfair for the relevant preceding financial period or any other
period.
2. Due to the scale of the Combined Group, there may be additional
changes to the Combined Group's operations. As a result, and given the fact
that the changes relate to the future, the resulting cost synergies may be
materially greater or less than those estimated.
3. In arriving at the estimate of cost synergies set out in this
Announcement, the Paddy Power Directors have assumed that there will be no
significant impact on the underlying operations of either business as a result
of the Merger.
Part B
Report from KPMG
Paddy Power plc
Power Tower
Belfield Office Park
Beech Hill Road
Clonskeagh
Dublin 4
Ireland
Morgan Stanley & Co. International plc
25 Cabot Square
Canary Wharf
London E14 4QA
United Kingdom
8 September 2015
Dear Sir or Madam:
Report on quantified financial benefits statement
We refer to the statement made by the directors of Paddy Power plc (the
"Company") (the "Directors") of quantified financial benefits set out in Part
A of Appendix IV to the announcement (the "Statement") issued by the Company
on 8 September 2015 in accordance with Rule 2.7 of the City Code (as defined
below) (the "Announcement").
The Statement has been made in the context of the disclosures in Part A of
Appendix IV to the Announcement setting out, inter alia, the basis of the
Directors' belief (including sources of information) supporting the Statement
and their analysis and explanation of the underlying constituent elements.
This report is required by Rule 28.1 of The City Code on Takeovers and Mergers
(the "City Code") and is given for the purpose of complying with that
requirement and for no other purpose.
Responsibility
It is the responsibility of the Directors to prepare the Statement in
accordance with the City Code. It is our responsibility to form an opinion,
as required by Rule 28.1(a)(i) of the City Code as to the proper compilation
of the Statement and report that opinion to you.
Save for any responsibility which we may have to those persons to whom this
report is expressly addressed, to the fullest extent permitted by law we do
not assume any responsibility and will not accept any liability to any other
person for any loss suffered by any such other person as a result of, arising
out of, or in connection with this report or our statement, required by and
given solely for the purposes of complying with Rule 23.3 of the City Code,
consenting to its inclusion in the Announcement.
Basis of preparation of the Statement
The Statement has been prepared on the basis stated in Part A of Appendix IV
to the Announcement.
Basis of opinion
We have discussed the Statement, together with the underlying plans, with the
Directors and with Morgan Stanley & Co. International plc. We have also
considered the letter dated 8 September 2015 from Morgan Stanley & Co.
International plc to the Directors on the same matter. Our work did not
involve any independent examination of any of the financial or other
information underlying the Statement. We conducted our work in accordance
with Standards for Investment Reporting issued by the Auditing Practices Board
of the United Kingdom and Ireland.
We planned and performed our work so as to obtain the information and
explanations we considered necessary in order to provide us with reasonable
assurance that the Statement has been properly compiled on the basis stated.
Our work has not been carried out in accordance with auditing or other
standards and practices generally accepted in the United States of America or
other jurisdictions and accordingly should not be relied upon as if it had
been carried out in accordance with those standards and practices.
We do not express any opinion as to the achievability of the benefits
identified by the Directors in the Statement. The Statement is subject to
uncertainty as described in Part A of Appendix IV to the Announcement.
Because of the significant changes in the enlarged group's operations expected
to flow from the transaction and because the Statement relates to the future,
the actual benefits achieved are likely to be different from those anticipated
in the Statement and the differences may be material.
Opinion
On the basis of the foregoing, we report that in our opinion the Statement has
been properly compiled on the basis stated.
Yours faithfully
KPMG
Chartered Accountants
Dublin, Ireland
Part C
Report from Morgan Stanley
The Directors
Paddy Power plc
Power Tower
Belfield Office Park
Beech Hill Road
Clonskeagh
Dublin 4
Ireland
8 September 2015
Dear Sirs,
Recommended all-share merger of Paddy Power plc ("Paddy Power") and Betfair
Group plc ("Betfair")
We refer to the Quantified Financial Benefits Statement, the bases of belief
thereof and the notes thereto (together, the "Statement") as set out in Part A
of Appendix IV of this Announcement, for which the directors of Paddy Power
(the "Directors") are solely responsible under Rule 28 of the City Code on
Takeovers and Mergers (the "Code").
We have discussed the Statement (including the assumptions and sources of
information referred to therein), with the Directors and those officers and
employees of Paddy Power who developed the underlying plans together with
certain officers and employees of Betfair. The Statement is subject to
uncertainty as described in this Announcement and our work did not involve an
independent examination of any of the financial or other information
underlying the Statement.
We have relied upon the accuracy and completeness of all the financial and
other information provided to us by or on behalf of Paddy Power and Betfair,
or otherwise discussed with or reviewed by us, and we have assumed such
accuracy and completeness for the purposes of providing this letter.
We do not express any view or opinion as to the achievability of the
quantified financial benefits identified by the Directors.
We have also reviewed the work carried out by KPMG and have discussed with
them the opinion set out in Part B of Appendix IV of this Announcement
addressed to yourselves and ourselves on this matter.
This letter is provided to you solely in connection with Rule 28.1(a) (ii) of
the Code and for no other purpose. We accept no responsibility to Paddy Power
or its shareholders or any person other than the Directors in respect of the
contents of this letter; no person other than the Directors can rely on the
contents of this letter and, to the fullest extent permitted by law, we
exclude all liability (whether in contract, tort or otherwise) to any other
person, in respect of this letter or the work undertaken in connection with
this letter or any of the results that can be derived from this letter or any
written or oral information provided in connection with this letter, and any
such liability is expressly disclaimed except to the extent that such
liability cannot be excluded by law.
On the basis of the foregoing, we consider that the Statement, for which you
as the Directors are solely responsible, has been prepared with due care and
consideration.
Yours faithfully,
Morgan Stanley & Co. International plc
APPENDIX V
PADDY POWER PROFIT FORECAST
Part A
On 26 August 2015, Paddy Power released its interim results announcement for
the six months ended 30 June 2015. Included in this interim results
announcement was the following statement, which for the purposes of Rule 28 of
the Code constitutes a profit forecast for the financial year ending 31
December 2015:
"We now expect full year 2015 reported operating profit to be a mid to high
single digit percentage above 2014 and the consensus market forecast."
The Paddy Power Directors have considered and confirm that the Paddy Power
Profit Forecast remains valid.
Bases of belief
The Paddy Power Profit Forecast has been prepared on a basis consistent with
the accounting policies for the Paddy Power Group, which are in accordance
with IFRS and those which Paddy Power anticipates will be applicable for the
full year ending 31 December 2015.
The Paddy Power Directors have prepared the Paddy Power Profit Forecast based
on the unaudited management accounts for the seven month period from 1 January
2015 to 31 July 2015 and a forecast of the results for the five month period
ending 31 December 2015.
Reports
As required by Rule 28.1(a) of the Code, KPMG, as reporting accountants to
Paddy Power, have provided a report stating that, in their opinion, the Paddy
Power Profit Forecast has been properly compiled on the basis stated. In
addition Morgan Stanley, as financial adviser to Paddy Power, has provided a
report stating that, in its opinion, the Paddy Power Profit Forecast has been
prepared with due care and consideration.
Copies of these reports are included in Parts B and C of this Appendix V. KPMG
and Morgan Stanley have given and not withdrawn their consent to the
publication of their reports in the form and context in which they are
included.
Assumptions
The Profit Forecast has been prepared on the basis of the following
assumptions, all of which are outside the control or influence of the
Directors:
· there will be no material change in the ownership and control of the
Paddy Power Group;
· there will be no material change to the Paddy Power Group's customer
base or their ability or willingness to meet their obligations to the Paddy
Power Group from that currently anticipated by the Directors;
· there will be no material change to foreign exchange rates currently
prevailing;
· there will be no material change in current trading conditions or
performance;
· there will be no disruption to the sporting calendar or broadcasting of
major sporting events due to weather or other factors;
· there will no material change in legislation or regulatory requirements
impacting the Paddy Power Group's operations or accounting policies;
· there will not be any changes in general trading and economic
conditions in the countries in which the Paddy Power Group operates or trades
which would materially affect the Paddy Power Group's business;
· there will be no business interruptions that materially affect the
Paddy Power Group, its major suppliers or its customers by reason of
technological faults, natural disasters, industrial disruption, civil
disturbance or government action; and
· there will be no material change to the competitive environment leading
to an adverse impact on consumer preferences or the capacity of the business
to penetrate new markets.
Part B
Report from KPMG
The Directors
Paddy Power plc
Power Tower
Belfield Office Park
Beech Hill Road
Clonskeagh
Dublin 4
Ireland
Morgan Stanley & Co. International plc
25 Cabot Square
Canary Wharf
London E14 4QA
United Kingdom
8 September 2015
Dear Sir or Madam:
Paddy Power plc
We report on the profit forecast of Paddy Power plc (the "Company") and its
subsidiary undertakings (the "Group") for the year ending 31 December 2015
(the "Profit Forecast") set out in Part A of Appendix V to the announcement
issued by the Company on 8 September 2015 in accordance with Rule 2.7 of the
Code (as defined below) (the "Announcement"). The Profit Forecast, and the
material assumptions upon which it is based, are set out in Part A of Appendix
V to the Announcement. This report is required by Rule 28.1 of the City Code
on Takeovers and Mergers (the "Code") and is given for the purpose of
complying with that rule and for no other purpose.
Responsibilities
It is the responsibility of the directors of the Company (the "Directors") to
prepare the Profit Forecast in accordance with the requirements of the Code.
It is our responsibility to form an opinion as required by the Code as to the
proper compilation of the profit forecast and to report that opinion to you.
Save for any responsibility which we may have to those persons to whom this
report is expressly addressed, to the fullest extent permitted by law we do
not assume any responsibility and will not accept any liability to any other
person for any loss suffered by any such other person as a result of, arising
out of, or in accordance with this report or our statement required by and
given solely for the purposes of complying with Rule 23.3 of the Code,
consenting to its inclusion in the Announcement.
Basis of Preparation of the Profit Forecast
The Profit Forecast has been prepared on the basis stated in Part A of
Appendix V to the Announcement. The Profit Forecast is required to be
presented on a basis consistent with the accounting policies of the Group.
Basis of opinion
We conducted our work in accordance with Standards for Investment Reporting
issued by the Auditing Practices Board of the United Kingdom and Ireland. Our
work included evaluating the basis on which the historical financial
information included in the Profit Forecast has been prepared and considering
whether the Profit Forecast has been accurately computed based upon the
disclosed assumptions and the accounting policies of the Group. Whilst the
assumptions upon which the Profit Forecast are based are solely the
responsibility of the Directors, we considered whether anything came to our
attention to indicate that any of the assumptions adopted by the Directors
which, in our opinion, are necessary for a proper understanding of the Profit
Forecast have not been disclosed or if any material assumption made by the
Directors appears to us to be unrealistic.
We planned and performed our work so as to obtain the information and
explanations we considered necessary in order to provide us with reasonable
assurance that the Profit Forecast has been properly compiled on the basis
stated.
Since the Profit Forecast and the assumptions on which it is based relate to
the future and may therefore be affected by unforeseen events, we can express
no opinion as to whether the actual results reported will correspond to those
shown in the Profit Forecast and differences may be material.
Our work has not been carried out in accordance with auditing or other
standards and practices generally accepted in the United States of America or
other jurisdictions and accordingly should not be relied upon as if it had
been carried out in accordance with those standards and practices.
Opinion
In our opinion the Profit Forecast, so far as the accounting policies and
calculations are concerned, has been properly compiled on the basis of the
assumptions made by the Directors and the basis of accounting used is
consistent with the accounting policies of the Group.
Yours faithfully
KPMG
Chartered Accountants
Dublin, Ireland
Part C
Report from Morgan Stanley
The Directors
Paddy Power plc
Power Tower
Belfield Office Park
Beech Hill Road
Clonskeagh
Dublin 4
Ireland
8 September 2015
Dear Sirs,
Report on the Profit Forecast of Paddy Power Plc ("Paddy Power")
We refer to the profit forecast as set out in Part A of Appendix V of this
Announcement (the "Profit Forecast"), for which the directors of Paddy Power
(the "Directors") are solely responsible under Rule 28 of the City Code on
Takeovers and Mergers (the "Code").
We have discussed the Profit Forecast (including the bases and assumptions on
which it is made), with the Directors and KPMG, Paddy Power's reporting
accountants. We have also discussed the accounting policies and bases of
calculation for the Profit Forecast with you and with KPMG. We have also
reviewed the work carried out by KPMG and have discussed with them the opinion
set out in Part B of Appendix V of this Announcement addressed to yourselves
and ourselves on this matter.
We have relied upon the accuracy and completeness of all the financial and
other information provided to us by or on behalf of Paddy Power, or otherwise
discussed with or reviewed by us, and we have assumed such accuracy and
completeness for the purposes of providing this letter. You have confirmed to
us that all information relevant to the Profit Forecast has been disclosed to
us. We do not express any view as to the achievability of the Profit
Forecast.
This letter is provided to you solely in connection with Rule 28.1(a) (ii) of
the Code and for no other purpose. We accept no responsibility to Paddy Power
or its shareholders or any person other than the Directors in respect of the
contents of this letter; no person other than the Directors can rely on the
contents of this letter and, to the fullest extent permitted by law, we
exclude all liability (whether in contract, tort or otherwise) to any other
person, in respect of this letter or the work undertaken in connection with
this letter or any of the results that can be derived from this letter or any
written or oral information provided in connection with this letter, and any
such liability is expressly disclaimed except to the extent that such
liability cannot be excluded by law.
On the basis of the foregoing, we consider that the Profit Forecast, for which
you as the Directors are solely responsible, has been prepared with due care
and consideration.
Yours faithfully,
Morgan Stanley & Co. International plc
APPENDIX VI
DEFINITIONS
The following definitions apply throughout this Announcement unless the
context otherwise requires:
£, GBP, Sterling, pence or p the lawful currency of the UK
Admission the New Paddy Power Betfair Shares being admitted to: (i) listing on the premium listing segment of the Official List of the FCA and to the secondary listing segment of the Official List of the Irish Stock Exchange as an overseas company; and (ii) trading
on the London Stock Exchange's main securities market for listed securities and the Irish Stock Exchange's regulated market
Announcement this Announcement made pursuant to Rule 2.7 of the City Code
AUD the lawful currency of Australia
Authorisations authorisations, orders, grants, recognitions, determinations, confirmations, consents, licences, clearances, permissions, exemptions and approvals
Betfair Betfair Group plc
Betfair Annual Report and Accounts the annual report and audited financial statements of Betfair for the year ended 30 April 2015
Betfair Directors or Directors of Betfair or Betfair Board or Board of Betfair the board of directors of Betfair at the date of the Announcement
Betfair General Meeting the general meeting of Scheme Shareholders to be convened in connection with the Scheme to consider, and if thought fit pass, inter alia, the Betfair Resolutions, including any adjournment thereof
Betfair Group Betfair and its subsidiary undertakings and associated undertakings and, where the context permits, each of them
Betfair Irish Sharesave Plan the BETsave Ireland Savings-Related Share Option Scheme approved by the Revenue Commissioner on 17 July 2013 and 15 October 2014
Betfair Long Term Incentive Plan means the 2009 long term incentive plan approved by resolution of the Betfair Board on 6 October 2010 and amended on 11 September 2012 and 6 March 2013
Betfair Resolutions the resolutions to be proposed by Betfair at the Betfair General Meeting in connection with, amongst other things, the approval of the Scheme, the amendment of Betfair's articles of association, the delisting of Betfair and such other matters as may be
necessary to implement the Scheme
Betfair Shareholders holders of Betfair Shares from time to time
Betfair Shares fully paid-up ordinary shares of £0.095 each in the share capital of Betfair
Betfair Sharesave Plan means the sharesave plan approved by H. M. Revenue & Customs under reference SRS102735, as amended on 8 October 2014
Betfair Share Schemes the share option and incentive schemes operated by the Betfair Group, further details of which will be set out in the Scheme Document
business day a day, not being a public holiday, Saturday or Sunday, on which banks in the City of London are open for normal business
CCPC the Competition and Consumer Protection Commission, an Irish statutory body established under the Competition and Consumer Protection Act 2014
City Code or Code the City Code on Takeovers and Mergers in the United Kingdom
Combined Group the combined Paddy Power Group and Betfair Group following Completion
Companies Act the Companies Act 2006 (as amended)
Competition and Markets Authority or CMA a UK statutory body established under the Enterprise and Regulatory Reform Act 2013
Completion the date upon which the Merger becomes Effective
Conditions the conditions of the Merger as set out in Appendix I to this Announcement and to be set out in the Scheme Document
Confidentiality the mutual confidentiality agreement entered into by Betfair and Paddy Power on 18 August 2015
Agreement
Co-operation Agreement the co-operation agreement entered into by Betfair and Paddy Power on 8 September 2015 in connection with the Merger
Court the High Court of Justice in England and Wales
Court Hearing the hearing by the Court to sanction the Scheme and to authorise the re-registration of Betfair as a private company under section 651 of the Companies Act
Court Meeting the meeting or meetings of the Scheme Shareholders as may be convened pursuant to an order of the Court under section 896 of the Companies Act for the purposes of considering and, if thought fit, approving the Scheme (with or without amendment approved or
imposed by the Court and agreed to by Betfair and Paddy Power) including any adjournment, postponement or reconvention of any such meeting, notice of which shall be contained in the Scheme Document
Court Order the order of the Court sanctioning the Scheme under section 899 of the Companies Act
CREST the relevant system (as defined in the Uncertificated Securities Regulations 2001 (SI 2001/3755)) in respect of which Euroclear UK & Ireland Limited is the operator (as defined in such Regulations) in accordance with which securities may be held and
transferred in uncertificated form
Daily Official List the daily official list of the London Stock Exchange or the Irish Stock Exchange (as appropriate)
Dealing Disclosure has the same meaning as in Rule 8 of the City Code
Disclosure and Transparency Rules the Disclosure and Transparency Rules of the FCA in its capacity as the UK Listing Authority under FSMA and contained in the UKLA's publication of the same name
Effective the Scheme having become effective pursuant to its terms or, if the Merger is implemented by way of a Merger Offer, the Merger Offer having been declared or having become unconditional in all respects in accordance with the requirements of the City Code
Effective Date the date upon which the Merger becomes Effective
Exchange Ratio 0.4254 New Paddy Power Betfair Shares for each Betfair Share held
Fairly Disclosed the information which has been fairly disclosed by or on behalf of Betfair: (i) in writing prior to the date of this Announcement by or on behalf of Betfair to Paddy Power or Paddy Power's financial, accounting, tax or legal advisers (specifically as Paddy
Power's advisers in relation to the Merger); (ii) in the Betfair Annual Report and Accounts; (iii) in a public announcement made in accordance with the Disclosure Rules and Transparency Rules by Betfair after 30 April 2015 and prior to the date of this
Announcement; or (iv) in this Announcement
FCA or Financial Conduct Authority the UK Financial Conduct Authority or its successor from time to time
Forms of Proxy the form of proxy in connection with each of the Court Meeting and the Betfair General Meeting, which shall accompany the Scheme Document
FSMA the Financial Services and Markets Act 2000
Goldman Sachs Goldman Sachs International
Goodbody Goodbody Stockbrokers
IBI Corporate Finance IBI Corporate Finance Limited
ICA the Irish Competition Act 2002
Irish Stock Exchange the Irish Stock Exchange plc
Listing Rules the rules and regulations made by the FCA under Part VI of the FSMA, and contained in the UK Listing Authority's publication of the same name and/or the Listing Rules of the Irish Stock Exchange, as the case may be (in each case, as amended from time to
time)
London Stock Exchange the London Stock Exchange plc
Long Stop Date 30 June 2016 or such later date as Betfair and Paddy Power may agree in writing, with the Panel's consent and the Court may approve (if such consent and/or approval is required)
Merger the proposed acquisition of the entire issued and to be issued share capital of Betfair by Paddy Power to be effected by the Scheme (or by the Merger Offer under certain circumstances described in this Announcement)
Merger Offer in the event that the Merger is to be implemented by way of a takeover offer as defined in Chapter 3 of Part 28 of the Companies Act, the takeover offer to be made by or on behalf of Paddy Power to acquire the entire issued and to be issued share capital
of Betfair and, where the context admits, any subsequent revision, variation, extension or renewal of such offer
Morgan Stanley Morgan Stanley & Co. International plc
New Paddy Power Betfair Shares the new ordinary shares of E0.09 each in the capital of Paddy Power Betfair to be issued credited as fully paid to Scheme Shareholders pursuant to the Merger
Offer Period as defined in the City Code
Official List the Official List of the FCA or the Official List of the Irish Stock Exchange (as applicable)
Opening Position Disclosure has the same meaning as in Rule 8 of the City Code
Overseas Shareholders Betfair Shareholders whose registered addresses are outside of the UK or who are citizens, nationals or residents of countries other than the UK
Paddy Power Paddy Power plc
Paddy Power Betfair the parent company of the Combined Group from the Effective Date (being Paddy Power plc, proposed to be renamed "Paddy Power Betfair plc")
Paddy Power Betfair Directors or Paddy Power Betfair Board or Proposed Directors the proposed board of directors of Paddy Power Betfair, further details of which are set out in this Announcement
Paddy Power Betfair Prospectus the prospectus to be published by Paddy Power in connection with the issue of the New Paddy Power Betfair Shares
Paddy Power Betfair Remuneration Committee the proposed remuneration committee of Paddy Power Betfair
Paddy Power Circular the circular to be sent by Paddy Power to Paddy Power Shareholders summarising the background to and reasons for the Merger, which will include a notice convening the Paddy Power General Meeting
Paddy Power Directors or Directors of Paddy Power or Paddy Power Board or Board of Paddy Power the board of directors of Paddy Power at the date of this Announcement
Paddy Power General Meeting the general meeting of Paddy Power Shareholders to be convened in connection with the Merger to consider and if thought fit pass, inter alia, the Paddy Power Resolutions, including any adjournment thereof
Paddy Power Group Paddy Power and its subsidiary undertakings and associated undertakings and, where the context permits, each of them
Paddy Power Profit Forecast the statement in italics and marked with an asterisk in Part A of Appendix V to this Announcement
Paddy Power Resolutions the resolutions to be proposed at the Paddy Power General Meeting in connection with the Merger, including, inter alia, resolutions to: (i) approve the Merger; and (ii) authorise the issuance of the New Paddy Power Betfair Shares, as set out in the notice
of meeting in the Paddy Power Circular
Paddy Power Shareholders holders of Paddy Power Shares from time to time
Paddy Power Shares fully paid-up ordinary shares of E0.09 each in the capital of Paddy Power
Paddy Power Share Schemes the share option and incentive schemes operated by the Paddy Power Group, further details of which will be set out in the Paddy Power Betfair Prospectus
Panel or Takeover Panel the Panel on Takeovers and Mergers
Phase 2 CMA Reference a reference by the CMA to its chair for the constitution of a group under Schedule 4 to the Enterprise and Regulatory Reform Act 2013
Prospectus Rules the prospectus rules made by the FCA under Part VI of the FSMA
Quantified Financial Benefits Statement as defined in Part A of Appendix IV to this Announcement
Regulatory Authority any government or governmental, quasi-governmental, supranational, statutory or regulatory body, or any court, institution, investigative body, association, trade agency or professional or environmental body or (without prejudice to the generality of the
foregoing) any other person or body in any jurisdiction
Regulatory Information Service any of the services set out in Appendix II to the Listing Rules
Registrar of Companies the Registrar of Companies in England and Wales
Restricted Jurisdiction any jurisdiction where local laws or regulations may result in significant risk of civil, regulatory or criminal exposure if information concerning the Merger is sent or made available to Betfair Shareholders in that jurisdiction (in accordance with Rule
30.3 of the City Code)
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