For immediate release
Not for release, publication or distribution, in whole or in part, in, into or from any jurisdiction where to do so would constitute a violation of the relevant laws or regulations of such jurisdiction
14 January 2011
PRE-CONDITIONAL RECOMMENDED CASH OFFER
BY
BAE SYSTEMS (HOLDINGS) LIMITED,
A WHOLLY-OWNED SUBSIDIARY OF BAE SYSTEMS PLC
FOR
NORKOM GROUP PLC
Summary
• The boards of BAE Systems plc (“BAE Systems”), BAE Systems (Holdings) Limited (“BAE Systems Holdings”) and Norkom Group plc (“Norkom”) are pleased to announce that they have reached agreement on the terms of a recommended cash offer by BAE Systems Holdings, a wholly owned subsidiary of BAE Systems, for the entire issued and to be issued share capital of Norkom.
• Norkom is a market-leading provider of innovative solutions to counter financial crime to the global financial services industry.
• BAE Systems is a global defence and security company.
• Under the terms of the Offer, Norkom Shareholders will be entitled to receive €2.10 in cash for each Norkom Share they own.
• The Offer values the entire issued and to be issued share capital of Norkom at approximately €217 million.
• As at 14 January 2011, the Offer represents:
- a premium of approximately 36 per cent. to the Closing Price of €1.54 per Norkom Share on 13 January 2011, being the last Business Day prior to the date of this announcement;
- a premium of approximately 121 per cent. to the Closing Price per Norkom Share on 25 November 2010 being the last Business Day prior to the commencement of the Offer Period, being €0.95; and
- a premium of approximately 82 per cent. to the average daily Closing Price per Norkom Share for the six months up to the commencement of the Offer Period, being €1.15.
• The making of the Offer is conditional upon satisfaction of the pre-condition set out in Appendix III to this announcement. The pre-condition requires BAE Systems Holdings to receive by 12 noon on the date of this announcement irrevocable undertakings in a form satisfactory to BAE Systems Holdings from all Norkom Directors, all members of the Norkom Senior Management Team, TVC Holdings plc and the TVC Connected Person to accept (or procure the acceptance of) the Offer in respect of 46,394,320 Norkom Shares, in aggregate representing approximately 44.9 per cent. of the entire issued share capital of Norkom (on a fully diluted basis) at the date of this announcement.
• The Board of Norkom, which has been so advised by Jefferies, considers the terms of the Offer to be fair and reasonable. In providing its advice, Jefferies has taken into account the commercial assessments of the Board of Norkom.
• Accordingly, the Board of Norkom unanimously recommends that Norkom Shareholders accept the Offer.
Commenting on the Offer, Paul Kerley, Chief Executive Officer of Norkom, said:
“In completing this transaction Norkom will be further strengthened by the scale, reputation and resources of BAE Systems. I am delighted that within BAE Systems we have found a home for Norkom that shares the same enthusiasm and ambition to build a truly great company in a growing market space. Norkom's technology platform together with BAE Systems' complementary technology and rich knowledge of the security space will create a fantastic opportunity to bring additional offerings to the market. BAE Systems has an enviable record in how it values and respects the people that make it successful. It gives me great pleasure to see Norkom become part of BAE Systems’ family and I look forward to our continued success together.”
Commenting on the Offer, Ian King, Chief Executive Officer of BAE Systems, said:
“Countering financial crime is a priority for governments and financial institutions. There is a compelling logic to the combination of Detica’s NetReveal® product and the complementary capabilities and customer reach of Norkom. The combination will result in a significantly enhanced offering for customers and present an opportunity for accelerated growth for the BAE Systems Group in the fast growing cyber and intelligence services sector.”
This summary should be read in conjunction with the full text of the following announcement and appendices.
The Offer will be subject to the conditions and further terms set out in Appendix I of this announcement, which will also be set out in the Offer Document and the Form of Acceptance. Appendix II contains the bases of calculation and sources of certain information contained in this announcement. Appendix III sets out the pre-condition to the making of the Offer. Appendix IV sets out definitions of certain terms used in this announcement (including in this summary).
Jefferies is acting as financial adviser to Norkom. Goodbody Corporate Finance is also acting as financial adviser to Norkom. William Fry is acting as legal adviser to Norkom.
Merrill Lynch International (“BofA Merrill Lynch”), a subsidiary of Bank of America Corporation, is acting as financial adviser to BAE Systems and BAE Systems Holdings. McCann FitzGerald is acting as legal adviser to BAE Systems and BAE Systems Holdings.
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