REG - Steris Corp. Synergy Health - Rule 2.7 <Origin Href="QuoteRef">STE.N</Origin> <Origin Href="QuoteRef">SYR.L</Origin> - Part 3
29/10/2014 11:25
- Part 3: For the preceding part double click ID:nRSM0911Ub
"Scheme Document" the document to be sent to Synergy Shareholders, containing, amongst other things, the Scheme and the notices convening the Court Meeting and the General Meeting
"Scheme Shareholders" the holders of Scheme Shares
"Scheme Shares" the Synergy Shares: (a) in issue at the date of the Scheme Document; (b) (if any) issued after the date of the Scheme Document but before the Voting Record Time; and (c) (if any) issued at or after the Voting Record Time but at or
before the Reduction Record Time on terms that the holder thereof shall be bound by the Scheme or in respect of which the original or any subsequent holders thereof are, or have agreed in writing to be, bound by the Scheme and, in each case, which remain
in issue at the Reduction Record Time, in each case other than any Synergy Shares legally or beneficially owned by New STERIS or any member of the STERIS Group
"Securities Act" the U.S. Securities Act of 1933, as amended
"Solar US Parent Co" Solar US Parent Co, a wholly owned subsidiary of New STERIS
"STERIS Board" the board of directors of STERIS
"STERIS Facility" the bridge credit facility dated 13 October 2014 being made available by Bank of America Merrill Lynch as administrative agent to Solar US Parent Co
"STERIS Group" STERIS and each of its subsidiaries
"STERIS Merger" the merger of U.S. Merger Sub with and into STERIS
"STERIS Merger Effective Date" the date on which the STERIS Merger becomes effective in accordance with its terms
"STERIS Stockholders" the holders of ordinary stock in STERIS
"Synergy Board" the board of Synergy Directors
"Synergy Directors" the directors of Synergy
"Synergy Group" Synergy and each of its subsidiaries
"Synergy Share" an ordinary share of 0.625p in Synergy
"Synergy Share Schemes" the Synergy Healthcare Long Term Incentive Plan, the Synergy Health plc Save As You Earn Scheme, the Isotron plc 2004 Performance Share Plan and the Synergy Healthcare plc Executive Share Option Scheme
"Synergy Shareholders" the holders of ordinary shares in Synergy
"Takeover Code" the City Code on Takeovers and Mergers
"UK" or "United Kingdom" the United Kingdom of Great Britain and Northern Ireland
"UKLA" the UK Listing Authority, being the FCA
"U.S." or "United States" the United States of America
"U.S. Merger Agreement" the agreement dated 13 October 2014 between (amongst others) U.S. Merger Sub, New STERIS and STERIS pursuant to which U.S. Merger Sub shall merge with and into STERIS
"U.S. Merger Sub" Solar US Merger Sub Inc., an indirect wholly owned subsidiary of New STERIS
"Voting Record Time" the date and time specified in the Scheme Document by reference to which entitlement to vote at the Court Meeting and the General Meeting will be determined
"Wider STERIS Group" STERIS and its associated undertakings and any other body corporate, partnership, joint venture or person in which STERIS and all such undertakings (aggregating their interests) have a direct or indirect interest of 20% or more of the total voting rights,
which in the case of a person or entity with equity share capital, means 20% or more of the total voting rights conferred by the equity share capital (as defined in section 548 of the Companies Act) of such undertaking
"Wider New STERIS Group" New STERIS and its associated undertakings and any other body corporate, partnership, joint venture or person in which New STERIS and all such undertakings (aggregating their interests) have a direct or indirect interest of 20% or more of the total voting
rights, which in the case of a person or entity with equity share capital, means 20% or more of the total voting rights conferred by the equity share capital (as defined in section 548 of the Companies Act) of such undertaking, including after the
Combination the Wider STERIS Group and the Wider Synergy Group
"Wider Synergy Group" Synergy and its associated undertakings and any other body corporate, partnership, joint venture or person in which Synergy and all such undertakings (aggregating their interests) have a direct or indirect interest of 20% or more of the total voting
rights, which in the case of a person or entity with equity share capital, means 20% or more of the total voting rights conferred by the equity share capital (as defined in section 548 of the Companies Act) of such undertaking
For the purposes of this Announcement, "subsidiary", "subsidiary undertaking",
"associated undertaking" and "undertaking" have the meanings given to such
terms in the Companies Act.
Appendix 2
CONDITIONS AND CERTAIN FURTHER TERMS OF THE OFFER
Conditions of the Offer
1. The Offer will be conditional upon the Scheme, subject to the
Takeover Code, becoming unconditional and becoming effective by no later than
13 April 2015 or such later date (if any) as STERIS and Synergy may, with the
consent of the Panel (if required), agree and (if required) the Court may
approve.
2. The Scheme will be subject to the following Conditions:
(a) its approval at the Court Meeting and at any separate class meeting
which may be required (or any adjournment thereof) by a majority in number
representing 75% or more in value of Scheme Shareholders who are on the
register of members of Synergy at the Voting Record Time and who are present
and voting, either in person or by proxy;
(b) the Court Meeting being held on or before the 22nd day after the
expected date of the Court Meeting to be set out in the Scheme Document (or
such later date as may be agreed by STERIS and Synergy);
(c) the special resolution required to approve amendments to the
articles of association of Synergy in connection with and to facilitate the
Scheme and the Capital Reduction, as set out in the notice of General Meeting
being duly passed at the General Meeting (or any adjournment thereof) by
Synergy Shareholders representing at least 75% of Synergy Shareholders who are
on the register of members of Synergy at the Voting Record Time and who are
present and voting, either in person or by proxy;
(d) the General Meeting being held on or before the 22nd day after the
expected date of the General Meeting to be set out in the Scheme Document (or
such later date as may be agreed by STERIS and Synergy);
(e) (x) the sanction of the Scheme and (y) the confirmation of the
Capital Reduction by the Court (in each case without modification or with such
modification as is agreed by STERIS and Synergy) and:
(i) the delivery for registration of office copies of each of the
Scheme Court Order and the Reduction Court Order (with the statement of
capital attached thereto) to the Registrar of Companies in England and Wales;
and
(ii) if so ordered by the Court in order to take effect, the
registration of the Reduction Court Order and such statement of capital by the
Registrar of Companies in England and Wales;
(f) the Scheme Court Hearing being held on or before the 22nd day after
the expected date of the Scheme Court Hearing to be set out in the Scheme
Document (or such later date as may be agreed by STERIS and Synergy); and
(g) the Reduction Court Hearing being held on or before the 22nd day
after the expected date of the Reduction Court Hearing to be set out in the
Scheme Document (or such later date as may be agreed by STERIS and Synergy).
3. In addition, Synergy and STERIS have agreed that the Scheme will be
conditional on the following matters and accordingly, the necessary actions to
make the Scheme effective shall not be taken unless the following Conditions
have been satisfied or waived:
Joint Proxy Statement and Prospectus
(a) the Form S-4 having become effective under the Securities Act and
not having been the subject of any stop order suspending its effectiveness,
and no proceedings seeking any such stop order having been initiated or
threatened by the SEC;
Consummation of the STERIS Merger
(b) (i) the U.S. Merger Agreement being duly approved by the
affirmative vote of the holders of a majority of the outstanding STERIS Shares
entitled to vote on such matter at a STERIS Stockholders' meeting duly called
and held for such purpose in accordance with applicable law and the articles
of incorporation and regulations of STERIS and (ii) all of the conditions to
the STERIS Merger having been satisfied such that, if the Scheme becomes
effective, the STERIS Merger will become effective in accordance with its
terms substantially concurrently with, or promptly after, the Scheme becomes
effective;
Admission of the New STERIS Shares
(c) all of the New STERIS Shares issuable pursuant to the Scheme and
the STERIS Merger having been approved for listing on the NYSE, subject to
official notice of issuance;
Merger Control
(d)
(i) all notifications and filings under the HSR Act, as amended, and
the regulations promulgated thereunder, shall have been made in connection
with the Combination or any aspect of the Combination and all applicable
waiting periods (including any extensions thereof) shall have expired or been
terminated;
(ii) the CMA issuing a decision, in terms satisfactory to STERIS, that
it is not making a CMA Phase 2 Reference in respect of the Combination or any
matter arising from it;
(iii) in the event that the European Commission decides to examine the
Combination or any matter arising from it pursuant to Article 22(3) of the EU
Merger Regulation, the European Commission having declared it compatible with
the internal market pursuant to Article 6(1)(b) of the EU Merger Regulation on
terms satisfactory to STERIS;
Any Other Mandatory or Appropriate Merger Control Filings
(e) any other mandatory or previously agreed merger control filings and
notifications required to implement the Scheme having been made, all
applicable waiting periods (including any extensions thereof) under any
applicable legislation or regulations of any jurisdiction having expired,
lapsed or been terminated, in each case in respect of the Combination and the
acquisition of any Synergy Shares, or of control of Synergy, by New STERIS,
and all authorisations, orders, recognitions, grants, consents, licences,
confirmations, clearances, permissions necessary or appropriate in any
jurisdiction for, or in respect of, the Combination having been obtained in
terms reasonably satisfactory to New STERIS from all appropriate Relevant
Authorities and all such authorisations remaining in full force and effect at
the time at which the Scheme becomes effective and STERIS having no knowledge
of an intention or proposal to revoke, suspend or modify or not to renew any
of the same and all necessary statutory or regulatory obligations in any
jurisdiction having been complied with, in each case except where not material
in the context of the Offer;
Absence of Injunction or Impediment
(f) no Relevant Authority or any other person or body in any
jurisdiction having decided to take, instituted, implemented or threatened any
action, proceedings, suit, investigation, enquiry or reference, or made,
proposed or enacted any statute, regulation, order or decision or taken any
other steps, and there not continuing to be outstanding any statute,
regulation, order or decision, which would or would reasonably be expected
to:
(i) make the Scheme or the STERIS Merger or any aspect of the Scheme
or the STERIS Merger void, illegal or unenforceable or otherwise materially
restrict, restrain, prohibit, delay or interfere with the implementation
thereof, or impose material additional conditions or obligations with respect
thereto, or require material amendment thereof or otherwise challenge or
interfere therewith;
(ii) require or prevent the divestiture by any member of the Wider
Synergy Group or any member of the Wider STERIS Group or any member of the
Wider New STERIS Group of all or a material portion of their respective
businesses, assets or property or impose any material limitation on the
ability of any of them to conduct their respective businesses or own any of
their assets or property to an extent which is material in the context of the
Wider Synergy Group taken as whole or the Wider STERIS Group taken as a whole
or the Wider New STERIS Group taken as a whole, as applicable, or material in
the context of the Offer;
(iii) impose any limitation on or result in a delay in the ability of
any member of the Wider Synergy Group or the Wider STERIS Group or the Wider
New STERIS Group to acquire or to hold or to exercise effectively any rights
of ownership of shares or loans or securities convertible into shares in any
member of the Wider Synergy Group or of the Wider STERIS Group or of the Wider
New STERIS Group held or owned by it or to exercise management control over
any member of the Wider Synergy Group or of the Wider STERIS Group or the
Wider New STERIS Group to an extent which is material in the context of the
Wider Synergy Group taken as a whole or the Wider STERIS Group or the Wider
New STERIS Group taken as a whole or material in the context of the Offer; or
(iv) otherwise materially and adversely affect the assets, business,
profits or prospects of any member of the Wider STERIS Group or of any member
of the Wider Synergy Group or the Wider New STERIS Group,
and all applicable waiting and other time periods during which any such
Relevant Authority could decide to take, institute, implement or threaten any
such action, proceeding, suit, investigation, enquiry or reference having
expired, lapsed or been terminated;
Certain Matters Arising as a Result of Any Arrangement, Agreement, etc.
(g) except as Disclosed, there being no provision of any arrangement,
agreement, licence, permit or other instrument to which any member of the
Wider Synergy Group is a party or by or to which any such member or any of
their assets is or may be bound, entitled or subject to and which, in
consequence of the Offer or the acquisition or proposed acquisition of any
Synergy Shares, or control of Synergy by New STERIS or otherwise, would or
would reasonably be expected to, to an extent which is material in the context
of the Wider Synergy Group taken as a whole or material in the context of the
Offer, result in:
(i) any monies borrowed by, or other indebtedness actual or contingent
of, any such member of the Wider Synergy Group being or becoming repayable or
being capable of being declared repayable immediately or prior to its or their
stated maturity or the ability of any such member to borrow monies or incur
any indebtedness being inhibited or becoming capable of being withdrawn;
(ii) the creation or enforcement of any mortgage, charge or other
security interest over the whole or any part of the business, property or
assets of any such member or any such security (whenever arising or having
arisen) being enforced or becoming enforceable;
(iii) any such arrangement, agreement, licence or instrument being or
becoming capable of being terminated or adversely modified or any action being
taken of an adverse nature or any obligation or liability arising thereunder;
(iv) any obligation to obtain or acquire any license, permission,
approval, clearance, permit, notice, consent, authorisation, waiver, grant,
concession, agreement, certificate, exemption, order or registration from any
governmental authority or any other person;
(v) any assets of any such member being disposed of or charged, or any
right arising under which any such asset could be required to be disposed of
or charged, other than in the ordinary course of business;
(vi) the interest or business of any such member of the Wider Synergy
Group in or with any firm or body or person, or any agreements or arrangements
relating to such interest or business, being terminated or adversely modified
or affected;
(vii) any such member ceasing to be able to carry on business under any
name under which it presently does so;
(viii) the creation of liabilities (actual or contingent) of any such
member or for which any such member may be responsible;
(ix) the creation or acceleration of any liability to taxation or an
adverse effect on the tax position of any such member or, after the Offer, the
Wider New STERIS Group;
(x) the financial or trading position of any such member being
prejudiced or adversely affected,
and no event having occurred which, under any provision of any arrangement,
agreement, licence or other instrument to which any member of the Wider
Synergy Group is a party, or under which any of its assets may be bound or
subject, could result in any of the events or circumstances as are referred to
in paragraphs (i) to (iv) of condition (f);
Certain Events Occurring Since Publication of Annual Results
(h) except as Disclosed, no member of the Wider Synergy Group having,
since 30 March 2014:
(i) issued, agreed to issue or proposed the issue of additional shares
or securities of any class, or securities convertible into, or exchangeable
for or rights, warrants or options to subscribe for or acquire, any such
shares, securities or convertible securities (save as between Synergy and
wholly-owned subsidiaries of Synergy and save for options granted, and for any
Synergy Shares allotted upon exercise of options granted under and in
accordance with the terms of the Synergy Share Schemes), or redeemed,
purchased or reduced any part of its share capital;
(ii) sold or transferred or agreed to sell or transfer any treasury
shares (save for the issue or transfer out of treasury of shares following the
exercise of any employee share options or vesting of employee share awards in
the ordinary course under the Synergy Share Schemes);
(iii) recommended, declared, paid or made or proposed to recommend,
declare, pay or make any bonus, dividend or other distribution other than to
Synergy or another member of the Wider Synergy Group;
(iv) other than the Scheme and the STERIS Merger, agreed, authorised,
proposed or announced its intention to propose any merger or demerger or
acquisition or disposal of assets or shares which is material in the context
of the Wider Synergy Group taken as a whole or material in the context of the
Offer (other than in the ordinary course of trading) or to any change in its
share or loan capital (or equivalent thereof) (in each case save for intra
Synergy Group transactions in the ordinary course);
(v) issued, authorised or proposed the issue of any debentures or
incurred any indebtedness or contingent liability other than in the ordinary
course of trading (in each case save for intra Synergy Group transactions in
the ordinary course) which is material in the context of the Synergy Group
taken as a whole or material in the context of the Combination;
(vi) acquired or disposed of or transferred, mortgaged or encumbered any
asset or any right, title or interest in any asset (other than in the ordinary
course of trading) in a manner which is material in the context of the Wider
Synergy Group taken as a whole or material in the context of the Combination;
(vii) entered into or varied or announced its intention to enter into or
vary any contract, arrangement or commitment (whether in respect of capital
expenditure or otherwise) which is of a long-term or unusual nature or is
outside the ordinary course of business or involves or could involve an
obligation of a nature or magnitude, and in any such case which contract,
arrangement, commitment or variance is material in the context of the Wider
Synergy Group taken as a whole or material in the context of the Offer,
including any contract, arrangement, commitment or variance that limits in any
material respect the freedom of any member of the Wider Synergy Group to
compete in any line of business or geographic region, or which requires any
member of the Wider Synergy Group to work exclusively with any person in any
business line or geographic region, or which by its terms would so limit the
freedom of or restrict the Combined Group following completion of the Offer;
(viii) entered into or proposed or announced its intention to enter into
any reconstruction, amalgamation, transaction or arrangement (otherwise than
in the ordinary course of business) which is material in the context of the
Wider Synergy Group taken as a whole or material in the context of the Offer;
(ix) taken any action or having had any steps taken or legal proceedings
initiated or threatened against it for its winding-up or dissolution or for it
to enter into any arrangement or composition for the benefit of its creditors,
or for the appointment of a receiver, administrator, trustee or similar
officer of it or any of its assets (or any analogous proceedings or
appointment in any overseas jurisdiction) (save in respect of a member of the
Synergy Group which is dormant and was solvent at the relevant time);
(x) been unable, or admitted in writing that it is unable, to pay its
debts or having stopped or suspended (or threatened to stop or suspend)
payment of its debts generally or ceased or threatened to cease carrying on
all or a substantial part of its business;
(xi) other than any retention bonuses within the scope set out in this
Announcement, or as otherwise agreed with STERIS, entered into or varied or
made any offer to enter into or vary the terms of any service agreement or
arrangement with any of the directors or any employee of the Wider Synergy
Group with an annual base salary in excess of £100,000 or who occupies a
position of senior manager or higher rank;
(xii) other than any retention bonuses within the scope set out in this
Announcement, or as otherwise agreed with STERIS, proposed, agreed to provide
or modified the terms of any share option scheme, incentive scheme or other
benefit relating to the employment or termination of employment of any
employee of the Wider Synergy Group;
(xiii) except in relation to necessary and consequential changes made as
a result of, or arising from, changes to legislation following the
Announcement Date, made or agreed or consented to any change to the terms of
the trust deeds and rules constituting the pension scheme(s) established for
its directors, employees or their dependants or any material change to the
benefits which accrue, or to the pensions which are payable, thereunder, or to
the basis on which qualification for, or accrual or entitlement to, such
benefits or pensions are calculated or determined or to the basis upon which
the liabilities (including pensions) of such pension schemes are funded or
made or agreed or consented to in each case which is material in the context
of the Wider Synergy Group taken as a whole or material in the context of the
Offer;
(xiv) taken any action which results in the creation or acceleration of
any material tax liability for any member of the Wider Synergy Group or a
material adverse effect on the tax position of any such member or, after the
Combination, any member of the Wider New STERIS Group;
(xv) entered into, implemented or authorised the entry into, any joint
venture, asset or profit sharing arrangement, partnership or merger of
business or corporate entities;
(xvi) waived, compromised or settled any claim which is material in the
context of the Wider Synergy Group taken as a whole or material in the context
of the Offer; or
(xvii) entered into or made an offer (which remains open for acceptance)
to enter into any agreement, arrangement or commitment or passed any
resolution with respect to any of the transactions or events referred to in
this paragraph (h);
No Adverse Change, Litigation, Regulatory Enquiry or Similar
(i) since 30 March 2014, except as Disclosed or where not material in
the context of the Wider Synergy Group taken as a whole or not material in the
context of the Offer:
(i) there having been no adverse change in the business, assets,
financial or trading position or profits or prospects of any member of the
Wider Synergy Group;
(ii) no litigation, arbitration proceedings, prosecution or other legal
proceedings having been instituted, announced or threatened by or against or
remaining outstanding against any member of the Wider Synergy Group and no
enquiry or investigation by or complaint or reference to any Relevant
Authority against or in respect of any member of the Wider Synergy Group
having been threatened, announced or instituted or remaining outstanding; and
(iii) no contingent or other liability having arisen or been incurred
which might reasonably be expected to adversely affect any member of the Wider
Synergy Group;
No Discovery of Certain Matters Regarding Information, Liabilities and
Environmental issues
(j) except as Disclosed, or where not material in the context of the
Wider Synergy Group taken as a whole or not material in the context of the
Offer, STERIS not having discovered in relation to the Wider Synergy Group,
that:
(i) the financial, business or other information concerning the Wider
Synergy Group which has been disclosed at any time by or on behalf of any
member of the Wider Synergy Group publicly (by the delivery of an announcement
to a Regulatory Information Service), either contains a material
misrepresentation of fact or omits to state a fact necessary to make the
information contained therein not materially misleading;
(ii) any member of the Wider Synergy Group is subject to any liability,
contingent or otherwise, which is not disclosed in the annual report and
accounts of Synergy for the financial year ended 30 March 2014;
(iii) any past or present member of the Wider Synergy Group has not
complied with all applicable Laws of any jurisdiction (including without
limitation any Law relating to environmental, anti-corruption and bribery
matters) which non-compliance would be likely to give rise to any liability
(whether actual or contingent) on the part of any member of the Wider Synergy
Group;
(iv) there has been a disposal, spillage, emission, discharge or leak of
waste or hazardous substance or any substance reasonably likely to impair the
environment or harm human health on, or from, any land or other asset now or
previously owned, occupied or made use of by any past or present member of the
Wider Synergy Group, or in which any such member may now or previously have
had an interest, which would be reasonably likely to give rise to any
liability (whether actual or contingent) on the part of any member of the
Wider Synergy Group;
(v) there is or is reasonably likely to be any obligation or liability
(whether actual or contingent) to make good, repair, reinstate or clean up any
property now or previously owned, occupied or made use of by any past or
present member of the Wider Synergy Group or in which any such member may now
or previously have had an interest under any environmental legislation or
regulation or notice, circular or order of any Relevant Authority in any
jurisdiction; or
(vi) circumstances exist whereby any Relevant Authority or any person or
class of persons would be reasonably likely to have any claim or claims in
respect of any product or process of manufacture, or materials used therein,
now or previously manufactured, sold, licensed or carried out by any past or
present member of the Wider Synergy Group which claim or claims would be
reasonably likely to affect adversely any member of the Wider Synergy Group.
Conditions 3(a) to (j) inclusive must be fulfilled, be determined by STERIS or
New STERIS to be satisfied or (if capable of waiver) be waived by STERIS or
New STERIS prior to commencement of the Scheme Court Hearing (or such later
date as agreed between STERIS and Synergy and with the approval of the Panel
(if required)), failing which the Scheme shall lapse.
To the extent permitted by law and subject to the requirements of the Panel,
STERIS or New STERIS reserve the right to waive all or any of the Conditions
(other than Conditions 1, 2 (except as set out below), 3(a), 3(b) and 3(c))
inclusive, in whole or inpart.
Certain Further Terms of the Offer
1. Subject to the requirements of the Panel, STERIS or New STERIS
reserve the right to waive:
(a) any of the Conditions set out in the above Condition 2 in respect
of any requirements therein for the timing of the Court Meeting, the General
Meeting, the Scheme Court Hearing to sanction the Scheme, the effectiveness of
the Scheme, and the timing of the Reduction Court Hearing. If any such
deadline is not met, STERIS or New STERIS will make an announcement by 8.00
a.m. on the Business Day following such deadline confirming whether it has
invoked or waived the relevant Condition or agreed with Synergy to extend the
deadline in relation to the relevant Condition; and
(b) in whole or in part, all or any of the above Conditions 3 (d) to
(j) (inclusive).
2. If STERIS or New STERIS is required by the Panel to make an offer
for Synergy Shares under the provisions of Rule 9 of the Takeover Code, STERIS
or New STERIS may make such alterations to any of the above Conditions and
terms of the Offer as are necessary to comply with the provisions of that
Rule.
3. The Combination shall lapse (unless otherwise agreed with the
Panel) if:
(a) it becomes the subject of a CMA Phase 2 Reference, or the European
Commission either initiates proceedings under Article 6(1)(c) of the EU Merger
Regulation in respect of the Combination or makes a referral of any part of
the Combination to a competent authority of the United Kingdom under Article
9(1) of the EU Merger Regulation and there is subsequently a CMA Phase 2
Reference in respect of the Combination; or
(b) in so far as the Combination or any matter arising from the Scheme
or the Combination does not constitute a concentration with an EU dimension
within the scope of the EU Merger Regulation, the European Commission decides
to examine the Combination or any matter arising from it pursuant to Article
22(3) of the EU Merger Regulation and the European Commission initiates
proceedings under Article 6(1)(c) of the EU Merger Regulation in respect of
the Combination,
in each case, before the date of the Court Meeting or the General Meeting.
4. Neither STERIS nor New STERIS shall be under any obligation to
waive (if capable of waiver), to determine to be or remain satisfied or to
treat as fulfilled any of Conditions 2 (to the extent capable of waiver), 3(d)
to (j) (inclusive) by a date earlier than the latest date for the fulfilment
of that Condition notwithstanding that the other Conditions of the Offer may
at such earlier date have been waived or fulfilled and that there are at such
earlier date no circumstances indicating that any of such Conditions may not
be capable of fulfilment.
5. If the Combination is implemented by way of a Contractual Offer,
the Synergy Shares acquired under the Offer shall be acquired fully paid and
free from all liens, equities, charges, encumbrances, options, rights of
pre-emption and any other third party rights and interests of any nature and
together with all rights attaching or accruing to them, including voting
rights and the right to receive and retain in full all dividends and other
distributions (if any) declared, made or paid on or after the date of this
announcement.
6. If prior to the Capital Reduction, any dividend or other
distribution is declared or paid by Synergy), STERIS or New STERIS reserves
the right (without prejudice to any right of STERIS or New STERIS, with the
consent of the Panel, to invoke Condition 3(h)(iii) above) to reduce the
consideration payable under the Scheme in respect of a Synergy Share by the
aggregate amount of such dividend or distribution (excluding associated tax
credit).
If any such dividend or distribution is paid or made before the Capital
Reduction, if STERIS or New STERIS exercises its rights described in this
paragraph, any reference in this announcement to the consideration payable
under the Scheme shall be deemed to be a reference to the consideration as so
reduced.
To the extent that such a dividend or distribution has been declared but not
paid prior to the Capital Reduction and such dividend or distribution is
cancelled, then the consideration payable under the Scheme shall not be
subject to change in accordance with this paragraph.
Any exercise by STERIS or New STERIS of its rights referred to in this
paragraph shall be the subject of an announcement and, for the avoidance of
doubt, shall not be regarded as constituting any revision or variation of the
Offer.
7. STERIS or New STERIS reserve the right to elect (subject to the
consent of the Panel) to implement the acquisition of the Synergy Shares by
way of a Contractual Offer as an alternative to the Scheme. In such event, the
Offer will be implemented by New STERIS or STERIS and/or a wholly-owned
subsidiary of STERIS on substantially the same terms as those which would
apply to the Scheme subject to appropriate amendments, including (without
limitation) an acceptance condition set at 90% (or such lesser percentage,
being more than 50%, as STERIS may decide) of the Synergy Shares to which the
offer relates.
8. The ability of the persons not resident in the United Kingdom to
participate in the Combination and/or receive New STERIS Shares may be
affected by the laws of the relevant jurisdictions. Persons who are not
resident in the United Kingdom should inform themselves about and observe any
applicable requirements.
9. The Offer is not being made, directly or indirectly, in, into or
from, or by use of the mails of, or by any means of instrumentality
(including, but not limited to, facsimile, e-mail or other electronic
transmission, telex or telephone) of interstate or foreign commerce of, or of
any facility of a national, state or other securities exchange of, any
jurisdiction where to do so would violate the laws of that jurisdiction.
10. Under Rule 13.5 of the Takeover Code, New STERIS may not invoke a
condition to the Scheme so as to cause the Scheme not to proceed, to lapse or
to be withdrawn unless the circumstances which give rise to the right to
invoke the condition are of material significance to New STERIS in the context
of the Offer. The determination of whether or not such a condition can be
invoked would be determined by the Panel. The conditions contained in
Conditions 1, 2 and 3(d)(ii) and (iii) are not subject to this provision of
the Takeover Code.
11. The New STERIS Shares to be issued under the Scheme will be issued
credited as fully paid and will rank pari passu with all other New STERIS
Shares, including the right to receive in full all dividends and other
distributions, if any, declared, made or paid after the date hereof.
12. Fractions of New STERIS Shares will not be allotted or issued to
Synergy Shareholders pursuant to the Scheme. Fractional entitlements to New
STERIS Shares will be rounded down to the nearest whole number of New STERIS
Shares.
13. The Offer is governed by the law of England and Wales and is
subject to the jurisdiction of the English courts and to the Conditions and
further terms set out in this Appendix 2 and to be set out in the Scheme
Document. The Scheme will be subject to the applicable requirements of the
Takeover Code, the Panel, the London Stock Exchange, the FCA and the UKLA.
Appendix 3
IRREVOCABLE UNDERTAKINGS AND LETTER OF INTENT
The following Synergy Directors and their connected persons have given
irrevocable undertakings to vote in favour of the Scheme on the basis set out
below:
Name of Director or connected person Number of Synergy Shares in respect of which undertaking is given Percentage of existing issued share capital of Synergy
Constance Frederique Baroudel 735 0.01
Adrian Vincent Coward 38,003 0.07
Gavin Fenton Hill 39,884 0.07
Anna Steeves 328,779 0.56
Richard Martin Steeves 219,222 0.38
Total 626,623 1.09
(a) These irrevocable undertakings include undertakings:
(i) to vote, or procure the vote, in favour (or to submit, or procure
the submission of, Forms of Proxy voting in favour) of
· the Scheme at the Court Meeting; and
· the Resolution at the General Meeting; and
(ii) if STERIS or New STERIS exercises its right to structure the Offer
as a Contractual Offer, to accept, or procure the acceptance of the
Contractual Offer.
(b) These irrevocable undertakings will lapse if:
(i) this Announcement has not been released within one business day
following the date of such undertaking (or such later date as may be agreed
between the parties); or
(ii) the Scheme Document has not been posted within 28 days of this
Announcement being released (or such later date as agreed by the Panel); or
(iii) in the event the Scheme lapses or is withdrawn and at or before
the time of such lapse or withdrawal, STERIS has not publicly confirmed that
it intends to implement a Contractual Offer; or
(iv) the Scheme has not become effective by 13 April 2015 (or such later
date as may be agreed between the parties, with the approval of the Court
and/or the Panel if required).
2. The following Synergy Shareholder has given an irrevocable
undertaking to vote in favour of the Scheme on the basis set out below:
Name of Synergy Shareholder Number of Synergy Shares in respect of which undertaking is given Percentage of existing issued share capital of Synergy
Kabouter Management LLC 2,179,398 3.69
(a) This irrevocable undertaking includes undertakings:
(i) to vote, or procure the vote, in favour (or to submit, or procure
the submission of, Forms of Proxy voting in favour) of
· the Scheme at the Court Meeting; and
· the Resolution at the General Meeting; and
(ii) if STERIS or New STERIS exercises its right to structure the Offer
as a Contractual Offer, to accept, or procure the acceptance of the
Contractual Offer.
(c) This irrevocable undertaking will lapse if an announcement is made
in accordance with Rule 2.7 of the Takeover Code of a competing offer in
respect of the Synergy Shares and such competing offer represents a value per
Synergy Share at the date and time in London of such announcement of not less
than 110% of the value attributed to each Synergy Share by the Scheme or any
Contractual Offer by STERIS.
3. The following Synergy Shareholder has given a letter of intent to
vote in favour of the Scheme on the basis set out below:
Name of Synergy Shareholder Number of Synergy Shares in respect of which undertaking is given Percentage of existing issued share capital of Synergy
AXA Investment Managers UK Limited 7,131,818 12.08
(a) This letter includes the intention:
(i) to vote in favour of
· the Scheme at the Court Meeting; and
· the Resolution at the General Meeting; and
(ii) if STERIS or New STERIS exercises its right to structure the Offer
as a Contractual Offer, to accept the Contractual Offer.
(b) This letter will lapse if :
(i) this Announcement is not made by 17 October 2014; or
(ii) in the event the Scheme lapses or is withdrawn.
Appendix 4
BASES AND SOURCES OF INFORMATION
1. The value of the Offer is calculated by reference to
the closing price of £14.00 per Synergy Share on the Latest Practicable Date
and on the basis of the current undiluted number of Synergy Shares in issue
referred to in paragraph 4 below and the exchange rate referred to in
paragraph 3 below.
2. References to percentages of Synergy Shares (before
completion of the Offer) are based upon the current undiluted number of
Synergy Shares in issue referred to in paragraph 3 below. The fully diluted
share capital of Synergy is 60,450,300 Synergy Shares.
3. As at the close of business on the Latest Practicable
Date, Synergy had in issue 59,024,389 Synergy Shares (being its undiluted
share capital). This does not include any shares issuable pursuant to any
options, warrants or other convertible securities in Synergy and assumes no
further issue of Synergy Shares prior to completion of the Offer.
4. Volume weighted average closing prices are the sum of
the product of the daily closing share price (derived from Facset function:
FG_PRICE) and the daily volume of shares traded (derived from Facset function:
P_VOLUME), divided by the sum of the shares traded over the period.
5. All closing prices for Synergy Shares are derived from
FactSet (function: FG_PRICE). The International Securities Identification
Number for Synergy Shares is GB0030757263.
6. All closing prices for STERIS Shares are derived from
FactSet (function: FG_PRICE). The International Securities Identification
Number for STERIS Shares is US8591521005.
7. An exchange rate of $1.61:£1 has been used, being the $/£ exchange
rate as at close of business in London on the Latest Practicable Date, sourced
from FactSet (function: P_EXCH_RATE(GBP,USD)).
8. References to Synergy revenues are taken from Synergy's unaudited
trading statement for the period ended 28 September 2014 published on 13
October 2014.
Appendix 5
SYNERGIES
The announcement states that:
"The Board of STERIS believes that the Combination will result in compelling
financial benefits to the Combined Group, including total annual pre-tax cost
savings of $30 million or more, which will be phased in 50% in fiscal year
2016 and 100% thereafter. These benefits will be primarily derived from
optimising global back-office infrastructure, leveraging best-demonstrated
practices across plants, in-sourcing consumables, and eliminating redundant
public company costs."
In identifying these cost savings, the directors of STERIS have formulated the
following bases of belief:
· Corporate & back-office ($25m): merger benefits due to integration of
support and back-office functions. Other areas of merger benefits include
in-sourcing of the internal audit function and consolidation of insurance and
bank arrangements.
· Isomedix ($3m): merger benefits within the Isomedix division will be
generated through improved production planning/loading in the expanded plant
network in the USA and by Synergy's differentiated production technology.
Benefits will also be achieved by some consolidation of personnel in the USA.
· Healthcare ($3m): merger benefits generated from the vertical
integration in this area where STERIS is a supplier of consumables needed by
Synergy's HSS division and consumable purchases will now be in-sourced within
the combined entity. Benefits will also be generated by in-sourcing
maintenance (which Synergy currently outsources) and by consolidating
distribution routes.
The phasing of the cost savings described above assumes, for these purposes,
that completion of the Combination occurred by 31 March 2015.
It is expected that the realisation of the identified synergies will require
estimated one-off cash costs of $60 million, largely occurring in fiscal year
2016 and in fiscal year 2017.
Aside from the one-off cash costs referred to above, the directors of STERIS
do not expect any material dis-synergies to arise in connection with the
merger of STERIS and Synergy.
In considering and reviewing these merger benefits, the directors of STERIS
have used a discussion with senior management, publicly available sources of
information relating to Synergy and a limited amount of private information
shared by Synergy, which included:
· selected lease agreements
· selected employee contracts
· high level organisational structure
· high level IT estate information
· selected management information
The publicly available sources, which included:
· the Synergy annual report and accounts;
· Synergy presentations to analysts;
· Synergy website;
· analysts' research;
· other public information; and
· STERIS's knowledge of the industry and of Synergy.
In preparing the merger benefits statement, STERIS has used an experienced
team of senior personnel from across its business. This team has a proven
track record of integrating businesses, re-scaling operations, delivering cost
synergies and creating improved prospects for growth. The STERIS team has used
STERIS's experience of previous synergy exercises, in particular in relation
to the acquisitions of Integrated Medical Systems (USA) and US Endoscopy
Group, Inc. (USA), its own market intelligence and experience and its
knowledge of STERIS's similar businesses to assess the expected savings.
Management carried out the following procedures to identify the potential
quantum and phasing of merger benefits within the areas above:
· considered the organisation structures and future operating model of the
combined business with specific reference made to application of the STERIS
business operating model to the combined business including centralisation of
back-office processes related to Finance, IT, HR and other support management
functions;
· developed hypotheses in each merger benefit area, identified the
addressable costs and the potential quantum of each synergy;
· validated these hypotheses through internal discussions and review of
publicly available information;
· used market intelligence and management's own experience of identifying
and delivering synergies from previous transactions, in particular the recent
acquisitions by STERIS of US Endoscopy in fiscal year 2012 and IMS in fiscal
year 2015; the STERIS management team also has experience in managing
acquisitions and cost saving initiatives in Europe (Switzerland, France, UK);
· used STERIS's own track record of identifying and delivering cost
savings from previous operational improvement initiatives (e.g. Isomedix lean
initiative at Whippany in Q4 2010).
Management identifies that Synergy and STERIS operate in similar,
complementary sectors with a relatively low degree of geographical overlap of
operations. STERIS (in North America) and Synergy (in Europe and North
America) both operate contract sterilization businesses primarily serving the
healthcare and medical device sectors, albeit with different technologies.
There are expected benefits to operations to the extent capacity can be shared
and optimised between facilities.
In arriving at the estimate of synergies set out in this announcement, the
directors of STERIS have made the following additional assumptions:
· there will be no significant impact on the underlying operations of
either business or their ability to win business from customers;
· there will be no material change to macroeconomic, political or legal
conditions in the markets or regions in which STERIS and Synergy operate that
materially impact on the implementation or costs to achieve the proposed cost
savings; and
· there will be no material change in tax legislation or tax rates in the
countries in which STERIS and Synergy operate that could materially impact the
ability to achieve any benefits.
The directors of STERIS consider that the expected benefits will only accrue
as a direct result of Synergy being combined with STERIS and could not be
achieved in this form independently of the merger.
As required by Rule 28.1(a) of the Takeover Code, Ernst & Young ("EY") have
provided a report stating that, in their opinion, the merger benefits
statement, for which the directors of STERIS are solely responsible, has been
properly compiled on the basis stated. In addition, Lazard has provided a
report for the purposes of Rule 28.1(a) of the Code stating that, in its
opinion and subject to the terms of such report, the merger benefits
statement, for which the directors of STERIS are solely responsible, has been
prepared with due care and consideration.
Copies of EY's and Lazard's reports are set out below. Each of EY and Lazard,
has given and has not withdrawn its consent to the publication of its report
in the form and context in which it is included.
Notes:
1. The statements of estimated cost savings and synergies relate to future
actions and circumstances which, by their nature, involve risks, uncertainties
and contingencies. As a result, the cost savings and 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.
2. Due to the scale of the enlarged group, there may be additional changes
to the enlarged group's operations. As a result, and given the fact that the
changes relate to the future, the resulting cost savings may be different than
those estimated.
3. No statement should be construed as a profit forecast or interpreted to
mean that the combined group's earnings in the first full year following a
merger, or in any subsequent period, would necessarily match or be greater
than or be less than those of STERIS and/or Synergy for the relevant preceding
financial period or any other period.
Annexes
Ernst & Young LLP
The Board of DirectorsSTERIS Corporation5960 Heisley Rd Mentor, OH 44060, United States Lazard & Co., Limited 13 October 2014
50 Stratton Street,
W1J 8LLUnited Kingdom
Dear Sirs,
We refer to the statement regarding the estimate of cost savings ("the
Statement") made by STERIS Corporation ("the Company"). The Statement,
including the relevant bases of belief (including sources of information) is
set out in section 8 and Appendix 5 of the announcement to be made by the
Company under Rule 2.7 of the City Code on Takeovers and Mergers (the "City
Code") issued by the Company dated on 13 October ("the Announcement"). This
report is required by Rule 28.1(a)(i) of the City Code and is given for the
purpose of complying with that rule and for no other purpose.
Save for any responsibility that we may have to those persons to whom this
report is expressly addressed, and for any responsibility arising under Rule
28.1(a)(i) of the City Code to any person as and to the extent there provided,
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(b) of the City Code consenting to its inclusion in
the Announcement.
Responsibility
It is the responsibility of the directors of the Company ("the Directors") to
prepare the Statement in accordance with the requirements of the City Code.
It is our responsibility to form an opinion as required by the Code as to the
proper compilation of the Statement and to report that opinion to you.
It is the responsibility of Lazard & Co., Limited to form an opinion as
required by the City Code as to whether the Statement has been prepared with
due care and consideration.
Basis of opinion
We conducted our work in accordance with Standards for Investment Reporting
1000 (Investment Reporting Standards applicable to all engagements in
connection with an investment circular) issued by the Auditing Practices Board
in the United Kingdom. We have discussed the Statement together with the
relevant bases of belief (including sources of information and assumptions)
with the Directors and with Lazard & Co., Limited. Our work did not involve
any independent examination of any of the financial or other information
underlying the Statement.
Since the Statement 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 Statement and differences may be material.
Our work has not been carried out in accordance with auditing or other
standards and practices generally accepted in other jurisdictions and
accordingly should not be relied upon as if
- More to follow, for following part double click ID:nRSM0911UdRecent news on Steris
See all newsREG - Travelex Financing - Update on debt restructuring
AnnouncementREG - Synergy Health Steris Corp. - Scheme Effective <Origin Href="QuoteRef">STE.N</Origin> <Origin Href="QuoteRef">SYR.L</Origin>
AnnouncementREG - State Street Global Steris Corp. Synergy Health - Form 8.3 - Steris Corporation <Origin Href="QuoteRef">STE.N</Origin> <Origin Href="QuoteRef">SYR.L</Origin>
AnnouncementREG - Legal&Gen Inv Mgmnt Synergy Health Steris Corp. - Form 8.3 - Steris Corporation <Origin Href="QuoteRef">STE.N</Origin> <Origin Href="QuoteRef">SYR.L</Origin>
AnnouncementREG-BARCLAYS PLC FORM 8.3 - STERIS CORPORATION <Origin Href="QuoteRef">BARC.L</Origin> <Origin Href="QuoteRef">STE.N</Origin>
Announcement