Implementation Agreement for Recommended Cash Offer by Gen-Probe for Tepnel Life Sciences PLC
Gen-Probe Incorporated and Tepnel Life Sciences PLC have agreed to a recommended cash offer in which Gen-Probe will acquire all issued and to-be-issued shares of Tepnel for 27.1 pence per share, valuing Tepnel at approximately £92.8 million. The acquisition will be carried out through a court-approved scheme of arrangement, subject to shareholder and court approval. Tepnel’s board unanimously recommends the offer, and significant shareholders have already committed their support. The transaction is expected to close in April 2009, pending satisfaction of all conditions.
| The Gen-Probe Directors and Tepnel Directors are pleased to announce that they have reached agreement on the terms of a recommended cash offer to be made by Gen-Probe for the entire issued and to be issued share capital of Tepnel. It is intended that the Offer will be effected by means of a scheme of arrangement under the Companies Act 2006. | |
| Under the terms of the Offer, Tepnel Shareholders will receive 27.1 pence in cash for each Tepnel Share. | |
| The Offer values each Tepnel Share at 27.1 pence and the fully diluted share capital of Tepnel at approximately £92.8 million ($132.2 million). | |
| The Offer represents a premium of approximately: |
| 125.8 per cent. to the closing price of Tepnel Shares of 12.0 pence per Tepnel Share on 21 January 2009, being the last business day immediately prior to the announcement by Tepnel that it had received an approach; and | ||
| 162.4 per cent. to 10.3 pence, being the average closing price per Tepnel Share over the 12 months prior to 21 January 2009. |
| Gen-Probe (NASDAQ: GPRO), based in San Diego, California, is a global leader in the development, manufacture and marketing of rapid, accurate and cost-effective nucleic acid probe-based products used primarily for the clinical diagnosis of human diseases and for screening donated human blood. | |
| Tepnel (AIM: TED) is a UK-based international life sciences products and services group with two divisions, Molecular Diagnostics and Research Products & Services. The Company has laboratories, manufacturing and operations in the USA, UK, France and Belgium with over 200 employees. Tepnel provides test kits, reagents and services to two highly synergistic markets, Molecular Diagnostics and Biomedical Research. | |
| The acquisition of Tepnel will allow Gen-Probe to enter the human leukocyte antigen, or HLA, and genetic testing segments. HLA testing, frequently conducted prior to transplantation and in the ongoing monitoring of transplant recipients, represents a significant product expansion area for Gen-Probe. In addition, Tepnel brings established pharmaceutical relationships and an opportunity for Gen-Probe to expand into the area of companion diagnostics. Gen-Probe further anticipates that its established capabilities in the research and development of novel diagnostics will help Tepnel accelerate its molecular diagnostics activities, including in the area of genetic testing for inherited disorders. Tepnel also contributes to Gen-Probes goal of expansion outside the United States. On a non-GAAP basis, Gen-Probe expects the acquisition to be neutral to the Companys 2009 EPS, and accretive to its 2010 EPS. | |
| The Tepnel Directors, who have been so advised by Seymour Pierce, consider the terms of the Offer to be fair and reasonable. In providing their advice to the Tepnel Directors, Seymour Pierce have taken into account the commercial assessments of the Tepnel Directors. In addition, the Tepnel Directors consider the terms of the Offer to be in the best interests of Tepnel Shareholders as a whole. |
1
| Accordingly, the Tepnel Directors intend unanimously to recommend that Tepnel Shareholders vote in favour of the Scheme and the resolutions at the Court Meeting and the GM as the Tepnel Directors have irrevocably undertaken to do in respect of their own beneficial holdings, representing as at the date of this announcement, in aggregate, approximately 4 per cent. of the existing issued share capital of Tepnel. | |
| Gen-Probe has received irrevocable undertakings from certain institutional shareholders to vote in favour of the Scheme and the resolutions at the Court Meeting and the GM in respect of their entire holdings representing, in aggregate, approximately 36 per cent. of the existing issued share capital of Tepnel. Gen-Probe has therefore received total irrevocable undertakings in respect of Tepnel Shares representing approximately 40 per cent. of the existing issued share capital of Tepnel. | |
| Gen-Probe has also received irrevocable undertakings from certain Tepnel Directors and certain institutional shareholders to exercise Tepnel Share Warrants conditional upon the sanction of the Scheme by the Court representing approximately, in aggregate, 16 per cent. of the diluted share capital of Tepnel. | |
| The Offer will be put to Tepnel Shareholders at the Court Meeting and at the GM. In order to become effective, the Scheme must be approved by a majority in number of the holders of Tepnel Shares present and voting, either in person or by proxy, representing at least 75 per cent. in value of the Tepnel Shares held by such Tepnel Shareholders at the Court Meeting. In addition, a special resolution implementing the Scheme and approving the related reduction of capital must be passed by Tepnel Shareholders representing 75 per cent. of the votes cast at the GM. The special resolution proposed at the GM will also approve related amendments to the articles of association of Tepnel and to certain of the Tepnel Share Schemes. | |
| It is expected that the Scheme Document containing further details of the Offer will be posted on or around 21 February 2009. The Scheme will be subject, inter alia, to the satisfaction or waiver of the conditions set out in Appendix I to this announcement and in the Scheme Document. | |
| It is expected that the Court Meeting and the General Meeting will be held on or around 16 March 2009 and that the Scheme will become effective on or around 8 April 2009. |
2
GEN-PROBE INCORPORATED | Telephone: + ###-###-#### | |
Herm Rosenman, Senior Vice President and Chief | ||
Financial Officer | ||
Michael Watts, Senior Director, Investor Relations | ||
MERRILL LYNCH INTERNATIONAL | ||
(Financial Adviser and Corporate Broker to Gen-Probe) | ||
San Francisco | Telephone: + ###-###-#### | |
Mark Robinson | ||
Glenn Rewick | ||
London | Telephone: + ###-###-#### | |
Jamie Heath | ||
TEPNEL LIFE SCIENCES PLC | Telephone: +44 ###-###-#### | |
Ben Matzilevich, Chief Executive Officer | ||
Michael Slater, Group Finance Director | ||
SEYMOUR PIERCE LIMITED | Telephone: +44 207 107 8000 | |
(Financial Adviser and Corporate Broker to Tepnel) |
Tom Sheldon
Christopher Wren
3
4
5
| 125.8 per cent. to the closing price of Tepnel Shares of 12.0 pence per Tepnel Share on 21 January 2009, being the last business day immediately prior to the announcement by Tepnel that it had received an approach; and | ||
| 162.4 per cent. to 10.3 pence, being the average closing price per Tepnel Share over the 12 months prior to 21 January 2009. |
6
7
8
9
| the Scheme becoming effective by not later than four months from the posting of the Scheme Document or such later date as Tepnel and Gen-Probe may agree and the Court may approve, failing which the Scheme will lapse; | ||
| the approval by a majority in number of the Scheme Shareholders who vote, representing at least 75 per cent. in value of the Scheme Shares voted, either in person or by proxy, at the Court Meeting; | ||
| the passing of the resolution(s) required to implement the Scheme and to amend the articles of association of Tepnel and the terms of certain of the Tepnel Share Schemes; | ||
| the sanction of the Scheme and subsequent confirmation of the Capital Reduction by the Court (in either case, with or without modification on terms agreed by Tepnel and Gen-Probe) and the delivery of office copies of the Court Orders to the Registrar and, in the case of the Capital Reduction, the registration of such Court Order; and | ||
| the conditions, set out in Appendix I to this announcement, which are not otherwise identified above being satisfied or waived. |
10
Party | Interest in Tepnel securities | |||||
Seymour Pierce | Long | 22,240 | ||||
Short | 0 | |||||
Net | 22,240 |
11
12
13
GEN-PROBE INCORPORATED | Telephone: + ###-###-#### | |
Herm Rosenman, Senior Vice President and Chief | ||
Financial Officer | ||
Michael Watts, Senior Director, Investor Relations | ||
MERRILL LYNCH INTERNATIONAL | ||
(Financial Adviser and Corporate Broker to Gen-Probe) | ||
San Francisco | Telephone: + ###-###-#### | |
Mark Robinson | ||
Glenn Rewick | ||
London | Telephone: + ###-###-#### | |
Jamie Heath |
14
TEPNEL LIFE SCIENCES PLC | Telephone: +44 ###-###-#### | |
Ben Matzilevich, Chief Executive Officer | ||
Michael Slater, Group Finance Director | ||
SEYMOUR PIERCE LIMITED | Telephone: +44 207 107 8000 | |
(Financial Adviser and Corporate Broker to Tepnel) |
Tom Sheldon
Christopher Wren
15
\
CONDITIONS AND FURTHER TERMS OF THE OFFER
1 | The Scheme will be conditional upon: | |
1.1 | the approval of the Scheme by a majority in number representing 75 per cent. or more in value of the Scheme Shareholders (or the relevant class or classes therof) present and voting, either in person or by proxy, at the Court Meeting, or at any adjournment thereof; | |
1.2 | the resolution(s) in connection with or required to implement the Scheme and set out in the notice of the GM being duly passed by the requisite majority at the GM, or at any adjournment thereof; and | |
1.3 | the sanction (with or without modification, on terms agreed by Tepnel and Gen-Probe) of the Scheme and confirmation of the Capital Reduction by the Court and office copies of the Court Orders and the minute of such Capital Reduction attached thereto being delivered for registration to the Registrar and, in relation to the Capital Reduction, being registered by the Registrar. | |
2 | In addition, Tepnel and Gen-Probe have agreed that, subject as stated in Part B below, the Scheme will also be conditional upon, and accordingly application to the Court to sanction the Scheme and to confirm the Capital Reduction will only be made upon conditions 1.1 and 1.2 above having been fulfilled and provided that immediately prior to the hearing of the petition to sanction the Scheme, the following conditions (as amended if appropriate) are satisfied or waived as referred to below: | |
2.1 | no central bank, government or governmental, quasi-governmental, state or local government, supranational, statutory, environmental, administrative, investigative or regulatory body, agency, court, association or any other person or body in any jurisdiction (a Relevant Authority) having decided to take, having taken, instituted, implemented or threatened any action, proceeding, suit, investigation or enquiry, or enacted, made or proposed any statute, regulation order, decision, changed a published position or otherwise taken any other step that would or might in the opinion of Gen-Probe in any respect reasonably be expected to: |
2.1.1 | require, prevent or delay the divestiture by any member of the Wider Gen-Probe Group or any member of the Wider Tepnel Group of all or any portion of their respective businesses, assets or properties or impose any limitation on the ability of any member of the Wider Gen-Probe Group or the Wider Tepnel Group to conduct their respective businesses (or any part of them) or to own or control any of their respective assets or properties or any part of them which, in any such case, is material in the context of the Wider Tepnel Group taken as a whole or in the context of the Offer; | ||
2.1.2 | other than pursuant to the implementation of the Offer require any member of either the Wider Gen-Probe Group or Wider Tepnel Group to make an offer to acquire any shares or other securities in any member of the Wider Tepnel Group owned by any third party; or |
16
2.1.3 | impose any material limitation on, or result in a material delay in, the ability of Gen-Probe or the Wider Gen-Probe Group directly or indirectly to acquire or to hold or to exercise effectively directly or indirectly all or any rights of ownership in respect of shares or loans or securities convertible into shares or any other securities (or the equivalent) in Tepnel or the ability of Gen-Probe to hold or exercise effectively any rights of ownership of shares, loans or other securities in, or to exercise management control over any member of the Wider Tepnel Group, which, in any such case, is material in the context of the Wider Tepnel Group taken as a whole or in the context of the Offer; | ||
2.1.4 | otherwise adversely affect the business, assets, liabilities, financial or trading position, profits or prospects of any member of the Wider Tepnel Group in each case to an extent which is material in the context of the Wider Tepnel Group taken as a whole or in the context of the Offer; | ||
2.1.5 | result in any member of the Wider Tepnel Group ceasing to be able to carry on business under any name under which it presently does so which is material in the context of the Wider Tepnel Group taken as a whole or in the context of the Offer; or | ||
2.1.6 | make the Scheme or its implementation or the acquisition of any shares in, or control of, Tepnel by any member of the Wider Gen-Probe Group, void, unenforceable, illegal and/or prohibited in or under the laws of any jurisdiction or otherwise directly or indirectly restrict, restrain, prohibit, delay or otherwise materially interfere with the implementation of, or impose additional conditions or obligations with respect to, or require amendment of, or otherwise challenge or interfere with, the Offer, |
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, proceedings, suit, investigation, enquiry or reference or take any other step under the laws of any jurisdiction having expired, lapsed or been terminated; | ||
2.2 | all necessary filings, applications and/or notifications which are necessary or reasonably considered necessary by Gen-Probe having been made and all appropriate waiting periods (including any extensions thereof) under any applicable legislation or regulation of any jurisdiction having expired, lapsed or been terminated in each case in respect of the Offer and the acquisition of any shares or other securities in, or control of, Tepnel by Gen-Probe or any member of the Wider Gen-Probe Group and all authorisations, orders, grants, recognitions, confirmations, licences, consents, clearances, permissions and approvals (authorisations) necessary or appropriate in any jurisdiction for or in respect of the Offer and the proposed acquisition of any shares or other securities in, or control or management of, Tepnel by Gen-Probe or any member of the Wider Gen-Probe Group being obtained in terms and in a form satisfactory to Gen-Probe, acting reasonably, from appropriate Relevant Authorities or from any persons or bodies with whom any member of the Wider Gen-Probe Group or the Wider Tepnel Group has entered into contractual arrangements and such authorisations together with all authorisations necessary or appropriate for any member of the Wider Tepnel Group to carry on its business remaining in full force and effect in each case where the absence of such authorisation would have a material adverse effect on the Wider Tepnel Group and there being no notice or other intimation of any intention to revoke, suspend, restrict or modify or not to renew any of the same having been made and all necessary statutory or regulatory obligations in any jurisdiction having been complied with; |
17
2.3 | save as fairly disclosed in the Annual Report or as Publicly Announced or fairly disclosed in writing to Gen-Probe or its advisers by or on behalf of Tepnel in the course of the negotiations relating to the Offer, in each case prior to the date of this announcement, there being no provision of any arrangement, agreement, lease, licence, permit or other instrument to which any member of the Tepnel Group is a party or by or to which any such member or any of its assets is or may be bound or be subject which, as a consequence of the Offer or the acquisition or the proposed acquisition by Gen-Probe or any member of the Wider Gen-Probe Group of any shares or other securities (or the equivalent) in Tepnel or because of a change in the control or management of any member of the Wider Tepnel Group or otherwise, would or might reasonably be expected to result in, in any case to an extent which is material in the context of the Wider Tepnel Group taken as a whole or in the context of the Offer in: |
2.3.1 | any monies borrowed by, or any other indebtedness, actual or contingent, of, or any grant available to, any member of the Wider Tepnel Group being or becoming repayable, or being capable of being declared repayable immediately or prior to their or its stated maturity, or the ability of any such member to borrow monies or incur any indebtedness being withdrawn or inhibited or becoming capable of being withdrawn or inhibited; | ||
2.3.2 | 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 member of the Wider Tepnel Group or any such mortgage, charge or other security interest (whenever arising or having arisen) becoming enforceable; | ||
2.3.3 | any such arrangement, agreement, lease, licence, permit or other instrument being, or becoming capable of being, terminated or adversely modified or affected or any onerous obligation or liability arising or any adverse action being taken thereunder; | ||
2.3.4 | any assets or interests of any member of the Wider Tepnel Group being or falling to be disposed of or charged or any right arising under which any such asset or interest could be required to be disposed of or charged or could cease to be available to any member of the Wider Tepnel Group; | ||
2.3.5 | the rights, liabilities, obligations or interests of any member of the Wider Tepnel Group in, or the business of any such member with, any person, firm or body (or any arrangement or arrangements relating to any such interest or business) being terminated, adversely modified or adversely affected; | ||
2.3.6 | any such member of the Wider Tepnel Group ceasing to be able to carry on business under any name under which it presently does so; | ||
2.3.7 | the value, financial or trading position, profits or prospects of Tepnel or any member of the Wider Tepnel Group being prejudiced or adversely affected; | ||
2.3.8 | the creation of any liability of any member of the Wider Tepnel Group to make severance, termination, bonus or other payment to any of its directors or officers; or | ||
2.3.9 | the creation of any liability (actual or contingent) by any member of the Wider Tepnel Group other than in the ordinary course of business, and no event having occurred which under any provision of any agreement, arrangement, licence, permit or other instrument to which any member of the Wider Tepnel Group is a party or by or to which any such member or any of its assets may be bound or subject, could reasonably be expected to result in any of the events or circumstances which are referred to in conditions 2.3.1. to 2.3.8; |
18
2.4 | save as fairly disclosed in the Annual Report or as Publicly Announced or fairly disclosed in writing to Gen-Probe or its advisers by or on behalf of Tepnel in the course of the negotiations relating to the Offer, in each case prior to the date of this announcement, no member of the Wider Tepnel Group having since 30 June 2008: |
2.4.1 | issued or agreed to issue or authorised or proposed or announced its intention to authorise or propose the issue of additional shares of any class, or securities convertible into, or exchangeable for, or rights, warrants or options to subscribe for or acquire, any such shares or convertible securities (save as between Tepnel and wholly-owned subsidiaries of Tepnel and save for the issue of the Tepnel Shares pursuant to or in connection with rights granted before the date of this announcement under, or the grant of rights before such date under, Tepnel Share Schemes or instruments constituting Tepnel Share Warrants); | ||
2.4.2 | recommended, declared, paid or made or proposed to recommend, declare, pay or make any bonus issue, dividend or other distribution whether payable in cash or otherwise other than dividends (or other distributions whether payable in cash or otherwise) lawfully paid or made by any wholly-owned subsidiary of Tepnel to Tepnel or any of its wholly-owned subsidiaries; | ||
2.4.3 | other than pursuant to the implementation of the Offer (and save for transactions between Tepnel and its wholly-owned subsidiaries and transactions in the ordinary course of business) implemented, effected, authorised, proposed or announced its intention to implement, effect, authorise or propose any merger, demerger, reconstruction, amalgamation, scheme, commitment or acquisition or disposal of assets or shares (or the equivalent thereof) in any undertaking or undertakings, that is material in the context of the Wider Tepnel Group taken as a whole, its share or loan capital or in the context of the Offer; | ||
2.4.4 | (save for transactions between Tepnel and its wholly-owned subsidiaries and save for transactions in the ordinary course of business) disposed of, or transferred, mortgaged or charged, or created any other security interest over, any asset or any right, title or interest in any asset that is material in the context of the Wider Tepnel Group taken as a whole or authorised, proposed or announced any intention to do so; | ||
2.4.5 | made, authorised, proposed or announced an intention to propose any change in its loan capital which is material in the context of the Wider Tepnel Group; | ||
2.4.6 | (save for transactions between Tepnel and its wholly-owned subsidiaries) issued, authorised or proposed or announced an intention to authorise or propose, the issue of any debentures or (save for transactions between Tepnel and its wholly-owned subsidiaries or transactions under existing credit arrangements or in the ordinary course of business) incurred any indebtedness or contingent liability which is material in the context of the Wider Tepnel Group as a whole or in the context of the Offer; | ||
2.4.7 | entered into, varied or terminated, or authorised, proposed or announced its intention to enter into, terminate or vary any contract, arrangement, agreement, transaction or commitment (whether in respect of capital expenditure or otherwise) which is of a long term, unusual or onerous nature or magnitude or which involves or is reasonably likely to involve an obligation of such a nature or magnitude which is, in any such case, or which is or is likely to be restrictive on the business of any member of the Wider |
19
Tepnel Group, which is, in any such case, material in the context of the Wider Tepnel Group or in the context of the Offer; |
2.4.8 | entered into or varied to a material extent or authorised, proposed or announced its intention to enter into or vary to a material extent the terms of, or make any offer (which remains open for acceptance) to enter into or vary to a material extent the terms of, any service agreement with any director or senior executive of any member of the Wider Tepnel Group; | ||
2.4.9 | 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 person employed by the Wider Tepnel Group save as agreed by Gen-Probe in writing; | ||
2.4.10 | other than in connection with the Offer, implemented or effected, or authorised, proposed or announced its intention to implement or effect, any composition, assignment, reconstruction, amalgamation, commitment, scheme or other offer or arrangement otherwise than in the ordinary course of business; | ||
2.4.11 | purchased, redeemed or repaid or announced a proposal to purchase, redeem or repay any of its own shares or other securities (or the equivalent) or reduced or made any other change to or proposed the reduction or other change to any part of its share capital, save for any shares the allotment of shares in connection with the Tepnel Share Schemes or Tepnel Share Warrants pursuant to rights granted before the date of this announcement or as between Tepnel and wholly-owned subsidiaries of Tepnel; | ||
2.4.12 | (other than in respect of claims between Tepnel and wholly-owned subsidiaries of Tepnel) waived, compromised or settled any claim which is material in the context of the Wider Tepnel Group as a whole; | ||
2.4.13 | terminated or varied the terms of any agreement or arrangement between any member of the Wider Tepnel Group and any other person in a manner which would or might reasonably be expected to have a material adverse effect on the financial position of the Wider Tepnel Group taken as a whole; | ||
2.4.14 | (save as disclosed on publicly available registers prior to the date of the announcement or as envisaged in accordance with the terms of the Scheme) made any alteration to its memorandum or articles of association; | ||
2.4.15 | save to the extent agreed by Gen-Probe in writing, made or agreed or consented to any significant change to the terms of the trust deeds constituting the pension schemes established for its directors and/or employees and/or their dependants or any material favourable change to the benefits which accrue, or to the pensions which are payable (including contributions payable to any such Schemes), 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 any change to the trustees involving the appointment of a trust corporation; | ||
2.4.16 | 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 any part of any |
20
business compromised or settled any claim which is material in the context of the Wider Tepnel Group as a whole or in the context of the Offer; |
2.4.17 | (other than in respect of a company which is dormant and was solvent at the relevant time) taken or proposed any corporate action or had any action or proceedings or other steps instituted against it for its winding-up (voluntary or otherwise), dissolution or reorganisation or for the appointment of a receiver, administrator, administrative receiver, trustee or similar officer of all or any material part of its assets or revenues or any analogous proceedings in any jurisdiction or appointed any analogous person in any jurisdiction; or | ||
2.4.18 | entered into any contract, agreement, arrangement or commitment or passed any resolution or made any proposal or announcement with respect to, or to effect, any of the transactions, matters or events referred to in this condition 2.4; |
2.5 | save as fairly disclosed in the Annual Report or as Publicly Announced or fairly disclosed in writing to Gen-Probe or its advisers by or on behalf of Tepnel in the course of negotiations relating to the Offer, in each case prior to the date of this announcement, since 30 June 2008 there having been: |
2.5.1 | no adverse change or deterioration in the business, assets, financial or trading position or profits or prospects of any member of the Wider Tepnel Group which is material in the context of the Wider Tepnel Group taken as a whole or in the context of the Offer; | ||
2.5.2 | no litigation, arbitration proceedings, prosecution or other legal proceedings having been threatened, announced or instituted by or against or remaining outstanding against or in respect of any member of the Wider Tepnel Group and which might reasonably be expected to have a material adverse effect on the Wider Tepnel Group taken as a whole or in the context of the Offer; | ||
2.5.3 | no enquiry or investigation by or complaint or reference to any Relevant Authority or other investigative body, threatened, announced, implemented or instituted or remaining outstanding by, against or in respect of any member of the Wider Tepnel Group which would or might reasonably be expected to have a material adverse effect on the Wider Tepnel Group taken as a whole in the context of the Offer; | ||
2.5.4 | no contingent or other liability having arisen or become apparent to any member of the Wider Gen-Probe Group which would or might reasonably be expected to adversely affect any member of the Wider Tepnel Group and which in any such case is material in the context of the Wider Tepnel Group taken as a whole or in the context of the Offer; and | ||
2.5.5 | no steps taken and no omissions made which are likely to result in the withdrawal, cancellation, termination or modification of any licence held by any member of the Wider Tepnel Group which is necessary for the proper carrying on of its business, |
which is material in the context of the Wider Tepnel Group taken as a whole; | ||
2.6 | save as fairly disclosed in the Annual Report or as Publicly Announced or fairly disclosed in writing to Gen-Probe or its advisers by or on behalf of Tepnel in the course of negotiations relating to the Offer, in each case prior to the date of this announcement, Gen-Probe not having discovered: |
21
2.6.1 | that the financial, business or other information concerning the Wider Tepnel Group Publicly Announced or disclosed at any time by or on behalf of any member of the Wider Tepnel Group contains a misrepresentation of fact or omits to state a fact necessary to make the information contained therein not misleading and which was not subsequently corrected by 28 January 2009 by disclosure either publicly or otherwise to Gen-Probe, which is, in any case, material in the context of the Wider Tepnel Group or in the context of the Offer; | |
2.6.2 | that any member of the Wider Tepnel Group, partnership, company or other entity in which any member of the Wider Tepnel Group has a significant economic interest and which is not a subsidiary undertaking of the Wider Tepnel Group is, otherwise than in the ordinary course of business, subject to any liability, contingent or otherwise, which is material in the context of the Wider Tepnel Group taken as a whole or in the context of the Offer; | |
2.6.3 | any information which affects the import of any information disclosed at any time by or on behalf of any member of the Wider Tepnel Group to an extent which is material in the context of the Wider Tepnel Group as a whole or in the context of the Offer; | |
2.6.4 | that any past or present member of the Wider Tepnel Group has failed to comply in any material respect with any and/or all applicable legislation or regulations of any jurisdiction or any notice or requirement of any third party with regard to the storage, treatment, transport, handling, disposal, discharge, spillage, release, leak or emission of any waste or hazardous or harmful substance or any substance likely to impair the environment or harm human or animal health or otherwise relating to environmental matters or that there has otherwise been any such use storage, treatment, transport, handling, disposal, discharge, spillage, release, leak or emission (whether or not the same constituted non-compliance by any person with any such legislation or regulation, and whenever the same may have taken place), any of which non-compliance would be likely to give rise to any material liability (whether actual or contingent) or cost on the part of any member of the Wider Tepnel Group and which is material, in the aggregate, in the context of the Wider Tepnel Group taken as a whole; | |
2.6.5 | there is, or is reasonably likely to be, any material obligation or liability (whether actual or contingent) to make good, repair, reinstate or clean up any property now or previously owned, occupied, operated or made use of or controlled by any past or present member of the Wider Tepnel Group under any environmental legislation, regulation, notice, circular, order or other requirement of any Relevant Authority in any jurisdiction, in each case to an extent which is material in the context of the Wider Tepnel Group taken as a whole; or | |
2.6.6 | that any past or present member of the Wider Tepnel Group, partnership, company or entity in which any member of the Wider Tepnel Group has an economic interest and which is not a subsidiary undertaking of the Wider Tepnel Group, has breached any trade marks, service marks, trade names, domain names, logos, get-up, patents, inventions, registered and unregistered design rights, copyrights, semi-conductor topography rights, database rights and all other similar rights in any part of the world (including, where such rights are obtained or enhanced by registration, any registration of such rights and applications and rights to apply for such registrations) of any third party to an extent which is material in the context of the Wider Tepnel Group taken as a whole or in the context of the Offer. |
22
23
SOURCES OF INFORMATION AND BASES OF CALCULATION
(i) | The value placed by the Offer on the fully diluted share capital of Tepnel is based on 239,051,526 existing shares in issue, 32,371,000 share options outstanding and 71,167,915 share warrants outstanding representing, in aggregate, 342,590,441 fully diluted shares. | |
(ii) | The closing share price on 21 January 2009 is the mid-market price taken from Bloomberg. | |
(iii) | Unless otherwise stated, the financial information relating to Tepnel is extracted from the audited consolidated financial statements of Tepnel for the financial year to 31 December 2007, prepared in accordance with IFRS and from the unaudited consolidated financial statements of Tepnel (from its interim report) for the six months ended 30 June 2008, prepared in accordance with IFRS. | |
(iv) | Unless otherwise stated, the financial information relating to Gen-Probe is extracted from the audited consolidated financial statements of Gen-Probe (from its 10K filing) for the financial year to 31 December 2007, prepared in accordance with US GAAP and from the unaudited consolidated financial statements of Gen-Probe (from its 10Q filing) for the quarter ended 30 September 2008, prepared in accordance with US GAAP. | |
(v) | EPS accretion has been calculated on a non-GAAP basis, excluding acquisition-related charges and the expected increase in depreciation and amortization expense from acquired assets. EPS refers to earnings before acquisition accounting adjustments and has not been prepared in accordance with US GAAP. | |
(vi) | This announcement also contains certain financial measures that are not calculated in accordance with US GAAP, including pro forma EPS accretion and dilution expectations, as stated above. Gen-Probes management believes that these US non-GAAP financial measures provide Gen-Probe investors meaningful supplemental information regarding the expected financial results of the acquisition. | |
(vii) | All US dollar figures have been converted to pounds sterling at the rate of £1 = US$1.424 being the exchange rate at 5:00p.m. in London on 29 January 2009, as sourced from Bloomberg. | |
(viii) | The International Securities Identification Number for Tepnel Shares is GB0008841859. |
24
DETAILS OF IRREVOCABLE UNDERTAKINGS
Number of | ||||||||||||||||
Tepnel Shares | ||||||||||||||||
arising on | ||||||||||||||||
exercise of | % of fully | |||||||||||||||
Number of | % of issued share | Tepnel Share | diluted share | |||||||||||||
Name | Tepnel Shares | capital | Warrants(1) | capital | ||||||||||||
IA Craig | 2,000,000 | 0.84% | 350,000 | 0.69% | ||||||||||||
B Matzilevich | 5,956,783 | 2.49% | 4,910,000 | 3.17% | ||||||||||||
MK Slater | 100,000 | 0.04% | | 0.03% | ||||||||||||
DR Marvin | 18,000 | 0.01% | 1,593,326 | 0.47% | ||||||||||||
M Miller | | | | | ||||||||||||
AJM Clarke PhD | 1,161,000 | 0.49% | 1,061,000 | 0.65% | ||||||||||||
Total | 9,235,783 | 3.86% | 7,914,326 | 5.01% |
Number of | ||||||||||||||||
Tepnel Shares | ||||||||||||||||
arising on | % of fully | |||||||||||||||
exercise of | diluted | |||||||||||||||
Number of | % of issued | Tepnel Share | share | |||||||||||||
Name | Tepnel Shares | share capital | Warrants(1) | capital | ||||||||||||
Ignis Investment Services Ltd | 8,953,419 | 3.75% | | 2.61% | ||||||||||||
Gartmore Investment Limited | 22,673,355 | 9.48% | | 6.62% | ||||||||||||
Orbimed Capital LLC | 47,000,000 | 19.66% | 45,840,000 | 27.10% | ||||||||||||
AXA-Framlington Investment Management Limited | 8,115,943 | 3.40% | 110,725 | 2.40% | ||||||||||||
Total | 86,742,717 | 36.29% | 45,950,725 | 38.73% |
(1) | The terms of these irrevocables require the relevant Tepnel Share Warrants to be exercised conditional upon the Court Sanctioning the Scheme. |
25
IMPLEMENTATION AGREEMENT
(i) | The Scheme Document, which sets out the terms of the Offer, is not posted by Tepnel to the Tepnel Shareholders within 28 days of the date of this Announcement (unless solely due to the default of Gen-Probe or its advisers); | |
(ii) | The Tepnel Directors, for whatever reason, withdraw, adversely modify or qualify their recommendation to Tepnel Shareholders to vote in favour of the Scheme and/or the resolutions at the GM and the Scheme does not complete, provided that the recommendation ceasing to be unanimous shall not constitute an adverse modification or qualification; or | |
(iii) | An independent competing offer is announced prior to the Offer lapsing or being withdrawn and that independent competing offer is either: (i) recommended by the Tepnel Directors; or (ii) is declared unconditional in all respects or is completed. |
(i) | of any approach that is made to Tepnel or to any member of its Group (or any director, officer, adviser or agent of Tepnel or any member of its Group) regarding any independent competing offer and will inform Gen-Probe of the material terms of such approach and keep Gen-Probe informed of any material changes to the terms of such approach; or | |
(ii) | if any information is provided to a third party in connection with an independent competing offer. |
26
(i) | If a condition of the Offer is incapable of satisfaction; | |
(ii) | if (i) the Scheme is not sanctioned by the Tepnel Shareholders at the Court Meeting; (ii) the resolutions are not passed at the GM; or (iii) the Court refuses to grant either of the Court Orders, in each case unless Gen-Probe has within 5 Business Days of such event elected to implement the Offer by way of an offer; or | |
(iii) | by notice in writing from Gen-Probe to Tepnel if the Tepnel Directors have withdrawn or adversely modified or qualified their recommendation (or intention to recommend) to Tepnel Shareholders to vote in favour of the Scheme and the GM Resolutions (or if applicable to accept an offer) and either (i) the Panel consents to Gen-Probe withdrawing its Offer (while structured as a Scheme) or (ii) an independent competing offer becomes or is declared wholly unconditional or is completed; or | |
(iv) | if Gen-Probe elects to implement the Offer by way of an offer, if the Offer is not announced under Rule 2.5 of the Code within 10 Business Days of the election or once announced, the Offer lapses in accordance with its terms or is withdrawn; or | |
(v) | if the Effective Date has not occurred within four months of the posting of the Scheme Document; or | |
(vi) | with the express written consent of Gen-Probe and Tepnel at any time prior to the Effective Date. |
27
DEFINITIONS
AIM | the AIM market operated by the London Stock Exchange | |
Annual Report | the annual report and accounts of Tepnel for the year ended 31 December 2007 | |
Business Day | a day (other than Saturdays, Sundays and public holidays in the UK) on which banks are open for business (other than solely for trading and settlement in Euros) in the City of London | |
Capital Reduction | the reduction of Tepnels share capital provided for by the Scheme | |
City Code or Code | the City Code on Takeovers and Mergers | |
Court | the High Court of Justice in England and Wales | |
Court Meeting(s) | the meeting of Tepnel Shareholders to be convened pursuant to an order of the Court under the Companies Act 2006 for the purpose of considering and if thought fit approving the Scheme (with or without modification) and any adjournment thereof | |
Court Order(s) | the order of the Court sanctioning the Scheme under the Companies Act 2006 and the order of the Court confirming the Capital Reduction under the Companies Act 1985 respectively or, where the context requires, either of them | |
CREST | the system for paperless settlement of trades in securities operated by CREST Co Limited in accordance with the Uncertificated Securities Regulations 2001 (SI 2001 No 3755) | |
Effective Date | the date on which the Scheme becomes effective pursuant to its terms or, should Gen-Probe elect to implement the Offer by way of an offer, the date on which the Offer becomes or is declared unconditional in all respects | |
Exchange Act | the United States Securities Exchange Act of 1934 (as amended) and the rules and regulations promulgated thereunder | |
Forms of Proxy | the forms of proxy for use at the Court Meeting and the General Meeting | |
FSA or Financial Services Authority | the Financial Services Authority in its capacity as the competent authority for the purposes of Part VI of the Financial Services and Markets Act 2000 | |
General Meeting or GM | the general meeting of Tepnel Shareholders (and any adjournment thereof) to be convened in connection with the Offer |
28
Gen-Probe | Gen-Probe Incorporated, a company incorporated in Delaware with commission file number 001-31279, having its registered office at 10210 Genetic Center Drive, San Diego, CA | |
Gen-Probe Directors | means the directors of Gen-Probe as at the date of this announcement | |
IFRS | International Financial Reporting Standards | |
Implementation Agreement | the implementation agreement dated on or about the date of this announcement between Tepnel and Gen-Probe pursuant to which, amongst other things, the parties have agreed to implement the Scheme | |
Irrevocable Undertakings | the irrevocable undertakings of the Tepnel Directors and certain institutional shareholders to vote in favour of the Scheme as set out in Appendix III to this announcement | |
London Stock Exchange | the London Stock Exchange plc | |
Merrill Lynch | Merrill Lynch International, of Merrill Lynch Financial Centre, 2 King Edward Street, London, EC1A 1HQ | |
Offer | the proposed recommended offer of 27.1 pence in cash per Tepnel Share to be made by Gen-Probe to acquire the entire issued and to be issued ordinary share capital of Tepnel by means of the Scheme or, should it so elect, by means of an offer | |
Offer Price | 27.1 pence in cash per Tepnel Share | |
Panel | The Panel on Takeovers and Mergers | |
Publicly Announced | means fairly disclosed in any public announcement by Tepnel to any regulatory information service or in its report and accounts for the year ended 31 December 2007 | |
Registrar | the Registrar of Companies in England and Wales | |
Regulatory Information Service | a service approved by the London Stock Exchange for the distribution to the public of AIM announcements and included within the list maintained on the London Stock Exchanges website, www.londonstockexchange.com | |
Restricted Jurisdiction | any jurisdiction where extension or acceptance of the Offer would violate the law of that jurisdiction | |
Scheme | the scheme of arrangement under the Companies Act 2006 to be proposed by Tepnel to the Scheme Shareholders (with or without modification on terms agreed by Tepnel and Gen-Probe), the full terms of which will be set out in the Scheme Document |
29
Scheme Document | the document to be sent to the Tepnel Shareholders, containing and setting out the Scheme and the notices convening the Court Meetings and the General Meeting | |
Scheme Record Time | 6.00 p.m. on the business day immediately prior to the Effective Date | |
Scheme Shareholders | holders of Scheme Shares | |
Scheme Shares | (i) the Tepnel Shares in issue at the date of the Scheme; | |
(ii) any Tepnel Shares issued after the date of the Scheme Document and before the Voting Record Time; and | ||
(iii) any Tepnel Shares issued at or after the Voting Record Time and before the Scheme Record Time in respect of which the original or any subsequent holders thereof are, or shall have agreed in writing to be, bound by the Scheme, | ||
in each case excluding any Tepnel Shares registered in the name of or beneficially owned by members of the Wider Gen-Probe Group | ||
Securities Act | The United States Securities Act of 1933 (as amended) and the rules and regulations promulgated thereunder | |
Seymour Pierce | Seymour Pierce Limited, of 20 Old Bailey, London EC4M 7EN | |
Tepnel or the Company | Tepnel Life Sciences plc, a company incorporated in England and Wales with registration number ###-###-#### having its registered office at Heron House, Oaks Business Park, Crewe Road, Wythenshawe, Manchester M23 9HZ | |
Tepnel Directors | the directors of Tepnel as at the date of this announcement | |
Tepnel Group | Tepnel, its subsidiaries and subsidiary undertakings | |
Tepnel Securities | securities convertible or exchangeable into Tepnel Shares | |
Tepnel Shareholders or Shareholders | the holders of Tepnel Shares | |
Tepnel Shares | the existing unconditionally allotted or issued and fully paid ordinary shares of 1 pence each in the capital of Tepnel | |
Tepnel Share Schemes | the Tepnel Executive Share Option Scheme, the Tepnel Unapproved Share Scheme, the Tepnel 2006 Long Term Incentive Plan and the Tepnel Enterprise Management Incentive Scheme | |
Tepnel Share Warrants | the warrants issued under the Warrant Instruments dated 1 November 2004, 31 May 2006 and 15 December 2006 |
30
UKLA | the UK Listing Authority, being the Financial Services Authority Limited acting in its capacity as the competent authority for the purposes of Part IV of the Financial Services and Markets Act 2000 | |
United Kingdom or UK | the United Kingdom of Great Britain and Northern Ireland | |
United States or US | the United States of America, its territories and possessions, any State of the United States of America and the District of Columbia | |
US dollar or US$ | the lawful currency of the United States | |
Voting Record Time | 6.00 p.m. on the day which is two days before the date of the Court Meeting or, if such Court Meeting is adjourned, 6.00 p.m. on the day which is two days before the day of such adjourned meeting | |
Wider Gen-Probe Group | Gen-Probe, its subsidiaries, subsidiary undertakings and associated undertakings and any other body corporate, partnership, joint venture or person in which Gen-Probe and such undertakings (aggregating their interests) have a direct or indirect interest of 20 per cent. or more of the voting or equity capital or equivalent | |
Wider Tepnel Group | Tepnel, its subsidiaries, subsidiary undertakings and associated undertakings and any other body corporate, partnership, joint venture or person in which Tepnel and such undertakings (aggregating their interests) have a direct or indirect interest of 20 per cent. or more of the voting or equity capital or the equivalent |
31