TIDMINGG TIDMINGC
RNS Number : 2253L
Gaming Acquisitions Limited
04 May 2010
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 OF SUCH JURISDICTION
4 May 2010
RECOMMENDED ACQUISITION
of
Inspired Gaming Group plc ("Inspired")
by
Gaming Acquisitions Limited, a company controlled by investment
partnerships advised by Vitruvian Partners LLP
("Bidco")
to be effected by means of a Scheme of Arrangement
under Part 26 of the
Companies Act 2006
Summary
· The Independent Directors and the Bidco Directors announce that
they have reached agreement on the terms of a recommended acquisition of the
entire issued and to be issued share capital of Inspired by Bidco. Bidco has
been formed for the purpose of making the Acquisition and is controlled by
investment partnerships advised by Vitruvian.
· It is intended that the Acquisition is to be effected by means of
a scheme of arrangement between Inspired and its shareholders under Part 26 of
the Companies Act 2006 (or should Bidco so elect, and subject to the consent of
the Panel, by means of the Offer).
· Under the Scheme, Scheme Shareholders will be entitled to receive
60 pence in cash for each Scheme Share.
· The Acquisition values the Inspired Shares in issue at the close
of business on 30 April 2010, the last Business Day prior to the date of this
announcement, at approximately GBP74.4 million, which represents a premium of
approximately 123.6 per cent. to the combined value of the then issued Old
Ordinary Shares and Convertible Preference Shares at the close of business on 27
July 2009, being the last Business Day prior to the commencement of the Offer
Period.
Note: The Old Ordinary Shares and the Convertible Preference Shares became
Inspired Shares pursuant to a share capital reorganisation completed on 27
November 2009.
· The Acquisition price of 60 pence per Inspired Share in cash
represents a premium of approximately:
i) 21.2 per cent. to the Closing Price of 49.50 pence on 30 April 2010,
being the last Business Day prior to the date of this announcement; and
ii) 31.7 per cent. to the average Closing Price of 45.56 pence for the
three months ended 30 April 2010, being the last Business Day prior to the date
of this announcement.
· As an alternative to the cash consideration to which they would
otherwise be entitled under the Acquisition, eligible Independent Inspired
Shareholders will be entitled to receive Holdco Group Securities subject to the
terms and conditions of the Holdco Group Securities Alternative.
· Inspired is a leading player in the Open Server-Based Gaming (Open
SBG) software systems market and is also a leading provider of analogue and Open
SBG machines in the UK for the leisure and gaming markets.
· Vitruvian is an independent private equity firm that specialises
in middle-market buyouts, growth buyouts and growth capital investments in the
United Kingdom and elsewhere in Northern Europe. Vitruvian acts as discretionary
manager to the Vitruvian Fund which comprises total commitments of EUR925 million.
· A committee of the Inspired Board comprising the Independent
Directors has been established for the purposes of progressing the Acquisition
and making the recommendations to Inspired Shareholders in relation to the
Acquisition.
· The Independent Directors, who have been so advised by Evolution
Securities, consider the terms of the Acquisition which offers cash
consideration to Inspired Shareholders, to be fair and reasonable. In providing
its advice to the Independent Directors, Evolution Securities has taken into
account the commercial assessment of the Independent Directors. Accordingly,
the Independent Directors intend to recommend that Inspired Shareholders vote in
favour of the Acquisition at the Court Meeting and the General Meeting, as the
Independent Directors (and their immediate families and related trusts) have
irrevocably undertaken to do in respect of their entire beneficial holding of
654,938 Inspired Shares, representing approximately 0.53 per cent. of the entire
issued share capital of Inspired.
· The Holdco Group Securities Alternative is not the subject of a
recommendation by the Independent Directors, and eligible Independent Inspired
Shareholders are strongly advised by the Independent Directors to seek their own
independent financial, tax and legal advice before electing to participate in
the Holdco Group Securities Alternative.
·The Bidco Group has entered into arrangements with the Executive Managers in
relation to their equity involvement in the Bidco Group. Under these
arrangements the Executive Managers and the Management Team are expected to
invest approximately GBP70,400 in the Bidco Group.
· Irrevocable undertakings to vote in favour of the Resolutions
(excluding the Ordinary Resolution) have been received from the Executive
Managers who are Inspired Shareholders and certain members of the Management
Team (and a related trust) in respect of a total of 1,595,856 Inspired Shares,
representing approximately 1.29 per cent. of the existing issued share capital
of Inspired. Further details of these irrevocable undertakings are set out in
Part A of Appendix V to this announcement.
· Bidco has received an irrevocable undertaking to vote in favour of
the Resolutions from Russell Hoyle in respect of a total of 594,663 Inspired
Shares, representing approximately 0.48 per cent. of the existing issued share
capital of Inspired. Further details of this irrevocable undertaking are set out
in Part B of Appendix V to this announcement.
· Bidco has received irrevocable undertakings and letters of intent
to vote in favour of the Acquisition and the Resolutions in respect of a total
of 67,324,792 Independent Inspired Shares, representing approximately 54.26 per
cent. of the existing issued Independent Inspired Shares. Further details of
these irrevocable undertakings and letters of intent are set out in Parts C and
D of Appendix V to this announcement.
· 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. Further details of the Scheme process will be set out in the
Scheme Document. It is expected that the Scheme Document will be posted as soon
as practicable and in any event within 28 days of this announcement, unless
otherwise agreed with the Panel, and that the Court Meeting and the General
Meeting to approve the Acquisition will be held in early June 2010. Subject to
Shareholder approval and the satisfaction or waiver of the other Conditions, it
is expected that the Scheme will become effective in early July 2010.
· Altium is acting as financial adviser to Bidco and Vitruvian. Evolution
Securities is acting as financial adviser to Inspired and is also Inspired's
nominated adviser for the purposes of the AIM Rules for Companies.
Commenting on the Acquisition, Julian Paul, the Senior Non Executive Director of
Inspired, said:
"The Acquisition represents an opportunity for Inspired Shareholders to realise
their entire investment in Inspired, in cash, at a premium to the current
Inspired Share price, within a relatively short period of time. We believe that
the Acquisition fairly reflects both Inspired's future growth prospects and the
challenges of executing its business plan as a publicly listed company."
Commenting on the Acquisition, Luke Alvarez, CEO of Inspired, said:
"In Vitruvian we have found the right partner to support this company's
development and provide the financial flexibility to implement its strategy.
There are many exciting growth opportunities for Inspired's technology and
operations and my team is enthusiastic about what this partnership will
achieve."
Commenting on the Acquisition, Ian Riley, a Managing Partner of Vitruvian, said:
"We are delighted to be able to support the management team at Inspired in the
next stage of the development of the Company. We have great respect for the
business they have built and we are keen to work with them and to provide
financial support to help accelerate the growth of Inspired and to exploit new
investment opportunities as they evolve over the medium term."
This summary should be read in conjunction with the accompanying full text of
this announcement which sets out further details of the Acquisition and which
forms an integral part of this announcement. Appendix I to this announcement
contains the conditions to, and certain further terms of, the Acquisition.
Appendix II contains further details on Holdco, Intermediate Holdco 1,
Intermediate Holdco 2, the Bidco Group and the Holdco Group Securities. Appendix
III contains risk factors connected to the Holdco Group Securities. Appendix IV
contains further details of the sources of information and bases of calculations
set out in this announcement. Appendix V contains further details of the
irrevocable undertakings and letters of intent and Appendix VI contains
definitions of certain expressions used in this summary and in this
announcement.
+-------------------------------------------+--------------------+
| Enquiries: | |
+-------------------------------------------+--------------------+
| Bidco: | Tel: 020 7518 2800 |
+-------------------------------------------+--------------------+
| Ian Riley | |
| Ben Johnson | |
| | |
+-------------------------------------------+--------------------+
| Altium Capital Limited (Financial Adviser | Tel: 020 7484 4040 |
| to Bidco): | |
+-------------------------------------------+--------------------+
| Stephen Georgiadis | |
| Tim Richardson | |
| | |
+-------------------------------------------+--------------------+
| Financial Dynamics (PR Advisers to | Tel: 020 7831 3113 |
| Bidco): | |
+-------------------------------------------+--------------------+
| Charles Palmer | |
| | |
+-------------------------------------------+--------------------+
| Inspired Gaming Group plc: | Tel: 07836 700401 |
+-------------------------------------------+--------------------+
| Russell Hoyle | |
| | |
+-------------------------------------------+--------------------+
| Evolution Securities Limited (Financial Adviser and Nominated |
| Adviser to Inspired): |
+----------------------------------------------------------------+
| Stuart Andrews | Tel: 020 7071 4300 |
| Sam Plumptre | |
+-------------------------------------------+--------------------+
| Speed Communications (PR Advisers to | Tel: 020 7842 3200 |
| Inspired): | |
+-------------------------------------------+--------------------+
| Lucy Buckley | |
| | |
+-------------------------------------------+--------------------+
Altium Capital Limited, which is authorised and regulated in the United Kingdom
by the Financial Services Authority, is acting exclusively for Bidco and
Vitruvian and no one else in connection with the Acquisition and will not be
responsible to anyone other than Bidco and Vitruvian for providing the
protections afforded to the clients of Altium Capital Limited, or for giving
advice in connection with the Acquisition, the contents of this announcement, or
the Forms of Proxy, or the Forms of Election or any matter referred to herein.
Evolution Securities Limited, which is authorised and regulated in the United
Kingdom by the Financial Services Authority, is acting exclusively for Inspired
and no one else in connection with the Acquisition and will not be responsible
to anyone other than Inspired for providing the protections afforded to the
clients of Evolution Securities Limited, or for giving advice in connection with
the Acquisition, the contents of this announcement, or the Forms of Proxy, or
the Forms of Election or any matter referred to herein.
The availability of the Acquisition or the distribution of this announcement to
persons who are not resident in the United Kingdom may be affected by the laws
of the relevant jurisdictions in which they are located. Persons who are not
resident in the United Kingdom should inform themselves of, and observe, any
applicable requirements. Any failure to comply with these restrictions may
constitute a violation of the securities laws of any such jurisdiction.
The Acquisition will not be made available, directly or indirectly, in or into
the United States or by use of the mails of, or by any means or instrumentality
(including, without limitation, facsimile or other electronic transmission,
telex or telephone) of inter-state or foreign commerce of, or any facility of, a
national, state or other securities exchange of, the United States, nor will it
be made available directly or indirectly in or into Canada, South Africa,
Australia or Japan, and no person may vote in favour of the Acquisition by any
such use, means, instrumentality or facility or from within the United States,
Canada, South Africa, Australia or Japan or any other such jurisdiction if to do
so would constitute a violation of the relevant laws of such jurisdiction.
Accordingly, copies of this announcement, the Scheme Document, the Forms of
Proxy and the Forms of Election are not being, will not be and must not be
mailed or otherwise forwarded, distributed or sent in, into or from the United
States, Canada, South Africa, Australia or Japan or any other such jurisdiction
if to do so would constitute a violation of the relevant laws of such
jurisdiction, and persons receiving this press announcement, the Scheme
Document, the Forms of Proxy and the Forms of Election (including without
limitation custodians, nominees and trustees) must not mail, forward, distribute
or send them in, into or from the United States, Canada, South Africa, Australia
or Japan or any other such jurisdiction if to do so would constitute a violation
of the relevant laws of such jurisdiction.
The Acquisition will be subject to the applicable rules and regulations of the
London Stock Exchange and the City Code.
Forward Looking Statements
This announcement contains statements that are or may be forward looking
statements. All statements other than statements of historical facts included in
this announcement may be forward looking statements. Without limitation, any
statements preceded or followed by or that include the words "targets", "plans",
"believes", "expects", "aims", "intends", "will", "should", "could", "would",
"may", "anticipates", "estimates", "synergy", "cost-saving", "projects", "goal"
or "strategy" or, words or terms of similar substance or the negative thereof,
are forward looking statements. Forward looking statements include statements
relating to the following: (i) future capital expenditures, expenses, revenues,
earnings, synergies, economic performance, indebtedness, financial condition,
dividend policy, losses and future prospects; (ii) business and management
strategies and the expansion and growth of Bidco's or Inspired's operations and
potential synergies resulting from the Acquisition; and (iii) the effects of
government regulation on Bidco's or Inspired's business.
These forward looking statements are not guarantees of financial performance.
They have not been reviewed by the auditors of Bidco or Inspired. Such forward
looking statements involve known and unknown risks and uncertainties that could
significantly affect expected results and are based on certain key assumptions.
Many factors could cause actual results to differ materially from those
projected or implied in any forward looking statements. Due to such
uncertainties and risks, readers are cautioned not to place undue reliance on
such forward looking statements, which speak only as of the date hereof. All
subsequent oral or written forward looking statements attributable to Bidco or
Inspired or any of their respective members, directors, officers or employees or
any persons acting on their behalf are expressly qualified in their entirety by
the cautionary statement above. Bidco and Inspired disclaim any obligation to
update any forward looking or other statements contained herein, except as
required by applicable law.
Dealing Disclosure Requirements
Under Rule 8.3(a) of the Code, any person who is interested in 1% or more of any
class of relevant securities of an offeree company or of any paper offeror
(being any offeror other than an offeror in respect of which it has been
announced that its offer is, or is likely to be, solely in cash) must make an
Opening Position Disclosure following the commencement of the offer period and,
if later, following the announcement in which any paper offeror is first
identified. An Opening Position Disclosure must contain details of the person's
interests and short positions in, and rights to subscribe for, any relevant
securities of each of (i) the offeree company and (ii) any paper offeror(s). An
Opening Position Disclosure by a person to whom Rule 8.3(a) applies must be made
by no later than 3.30 pm (London time) on the 10th business day following the
commencement of the offer period and, if appropriate, by no later than 3.30 pm
(London time) on the 10th business day following the announcement in which any
paper offeror is first identified. Relevant persons who deal in the relevant
securities of the offeree company or of a paper offeror prior to the deadline
for making an Opening Position Disclosure must instead make a Dealing
Disclosure.
Under Rule 8.3(b) of the Code, any person who is, or becomes, interested in 1%
or more of any class of relevant securities of the offeree company or of any
paper offeror must make a Dealing Disclosure if the person deals in any relevant
securities of the offeree company or of any paper offeror. A Dealing Disclosure
must contain details of the dealing concerned and of the person's interests and
short positions in, and rights to subscribe for, any relevant securities of each
of (i) the offeree company and (ii) any paper offeror, save to the extent that
these details have previously been disclosed under Rule 8. A Dealing Disclosure
by a person to whom Rule 8.3(b) applies must be made by no later than 3.30 pm
(London time) on the business day following the date of the relevant dealing.
If two or more persons act together pursuant to an agreement or understanding,
whether formal or informal, to acquire or control an interest in relevant
securities of an offeree company or a paper offeror, they will be deemed to be a
single person for the purpose of Rule 8.3.
Opening Position Disclosures must also be made by the offeree company and by any
offeror and Dealing Disclosures must also be made by the offeree company, by any
offeror and by any persons acting in concert with any of them (see Rule 8.1, 8.2
and 8.4).
Details of the offeree and offeror companies in respect of whose relevant
securities Opening Position Disclosures and Dealing Disclosures must be made can
be found in the Disclosure Table on the Takeover Panel's website at
www.thetakeoverpanel.org.uk, including details of the number of relevant
securities in issue, when the offer period commenced and when any offeror was
first identified. If you are in any doubt as to whether you are required to
make an Opening Position Disclosure or a Dealing Disclosure, you should contact
the Panel's Market Surveillance Unit on +44 (0)20 7638 0129.
In accordance with normal UK market practice, Bidco or its nominees or brokers
(acting as agents) may from time to time make certain purchases of, or
arrangements to purchase, Inspired Shares outside the United States, other than
pursuant to the Scheme, prior to the Scheme Effective Date. These purchases may
occur either in the open market at prevailing prices or in private transactions
at negotiated prices. Any information about such purchases will be disclosed as
required in the UK.
A copy of this announcement will be available on Inspired's website:
http://www.inspiredgaminggroup.com.
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 OF SUCH JURISDICTION
4 May 2010
RECOMMENDED ACQUISITION
of
Inspired Gaming Group plc ("Inspired")
by
Gaming Acquisitions Limited, a company controlled by investment
partnerships advised by Vitruvian Partners LLP
("Bidco")
to be effected by means of a Scheme of Arrangement
under Part 26 of the
Companies Act 2006
1 Introduction
The Independent Directors and the Bidco Directors are pleased to announce that
they have reached agreement on the terms of a recommended acquisition of the
entire issued and to be issued share capital of Inspired by Bidco. It is
intended that the Acquisition is to be effected by means of a scheme of
arrangement between Inspired and its shareholders under Part 26 of the Companies
Act 2006 (or should Bidco so elect, and subject to the consent of the Panel, by
means of the Offer).
Bidco has been formed for the purpose of making the Acquisition and is
controlled by investment partnerships advised by Vitruvian.
2 The Acquisition
Under the Scheme, which will be subject to the conditions and further terms set
out below and in Appendix I to this announcement and the full terms and
conditions which will be set out in the Scheme Document, Scheme Shareholders
will be entitled to receive:
for each Scheme Share held, 60 pence in cash.
The Acquisition values the Inspired Shares in issue at the close of business on
30 April 2010, the last Business Day prior to the date of this announcement, at
approximately GBP74.4 million, which represents a premium of approximately 123.6
per cent. to the market value of the then issued Old Ordinary Shares and
Convertible Preference Shares at the close of business on 27 July 2009, being
the last Business Day prior to the commencement of the Offer Period.
Note: The Old Ordinary Shares and the Convertible Preference Shares became
Inspired Shares pursuant to a share capital reorganisation completed on 27
November 2009.
The Acquisition price of 60 pence per Inspired Share in cash represents a
premium of approximately:
iii) 21.2 per cent. to the Closing Price of 49.50 pence on 30 April
2010, being the last Business Day prior to the date of this announcement; and
iv) 31.7 per cent. to the average Closing Price of 45.56 pence for the
three months ended 30 April 2010, being the last Business Day prior to the date
of this announcement.
As an alternative to the cash consideration to which they would otherwise be
entitled under the Acquisition, eligible Independent Inspired Shareholders will
be entitled to receive Holdco Group Securities subject to the terms and
conditions of the Holdco Group Securities Alternative.
The Scheme Document, containing further details of the Acquisition (including
notices of a Court Meeting and a General Meeting) together with the Forms of
Proxy and Forms of Election for the Holdco Group Securities Alternative, will be
posted to Inspired Shareholders and, for information only, to participants in
the Inspired Share Schemes as soon as practicable and in any event within 28
days of this announcement, unless otherwise agreed with the Panel. Resolutions
to, amongst other things, approve the Scheme and the Capital Reduction will be
put to Inspired Shareholders at the Court Meeting and the General Meeting,
respectively. It is expected that the Court Meeting and the General Meeting to
approve the Acquisition will be held in early June 2010. Subject to Shareholder
approval (as more fully described in paragraph 15 below) and the satisfaction or
waiver of the other Conditions, it is expected that the Scheme will become
effective in early July 2010.
3 Holdco Group Securities Alternative
As an alternative to the cash consideration to which they would otherwise be
entitled under the Acquisition, eligible Independent Inspired Shareholders will
be entitled to elect to receive Holdco Group Securities in respect of all or
part of their holding of Inspired Shares, in each case subject to the terms and
conditions of the Holdco Group Securities Alternative. The Holdco Group
Securities will comprise Holdco Ordinary Shares and Intermediate Holdco 1 Loan
Notes. The breakdown by nominal value of the Holdco Ordinary Shares and
Intermediate Holdco 1 Loan Notes that validly electing Independent Inspired
Shareholders will be entitled to receive under the Holdco Group Securities
Alternative will be set out in the Scheme Document. In addition electing
eligible Independent Inspired Shareholders will be entitled to receive a
commitment fee in cash of 1.5 per cent. of the value of the cash consideration
they receive in Holdco Group Securities.
Holdco Group Securities will be issued by Holdco (in respect of Holdco Ordinary
Shares) and Intermediate Holdco 1 (in respect of the Intermediate Holdco 1 Loan
Notes) and will represent an indirect investment in the Bidco Group. Further
details of the capital structure and rights of the Holdco Group Securities are
set out in Appendix II to this announcement and will be set out in the Scheme
Document.
The Holdco Group Securities will not be transferable except in extremely limited
circumstances save with the consent of Vitruvian Luxco. No application will be
made for the Holdco Group Securities to be listed or dealt in on any stock
exchange.
The Holdco Group Securities will not be offered, sold or delivered, directly or
indirectly, in or into the United States or any other Restricted Jurisdiction.
The Holdco Group Securities Alternative is conditional on the Scheme becoming
effective. Holdco Group Securities will not be issued pursuant to the Holdco
Group Securities Alternative unless, by the date seven days before the Scheme
Record Date, valid elections have been received from eligible Independent
Inspired Shareholders which would result in the issue to them of Holdco
Securities equating to at least 10 per cent. of the Holdco Group Securities. The
Holdco Group Securities Alternative will be limited to a maximum of 20 per cent.
of the Holdco Group Securities. To the extent that valid elections are received
which would result in the issue of Holdco Group Securities constituting greater
than this maximum, the amount of Holdco Group Securities to which each validly
electing eligible Independent Inspired Shareholder is entitled shall be reduced
pro rata to the proportion of Inspired Shares in respect of which such eligible
Independent Inspired Shareholder has validly elected to receive Holdco Group
Securities relative to the aggregate number of Inspired Shares in respect of
which all validly electing eligible Independent Inspired Shareholders have
elected to receive Holdco Group Securities. The balance of such Independent
Inspired Shareholders' entitlements to consideration for their Inspired Shares
shall be paid in cash.
If the Scheme becomes effective, eligible Independent Inspired Shareholders that
validly elect to receive Holdco Group Securities will direct Bidco to pay
(either directly or indirectly) the cash proceeds to which those Independent
Inspired Shareholders would otherwise be entitled respectively to Holdco in
consideration of the issue to those Independent Inspired Shareholders of Holdco
Ordinary Shares, and to Intermediate Holdco 1 in consideration of the issue to
those Independent Inspired Shareholders of Intermediate Holdco 1 Loan Notes.
Further details of the Holdco Group Securities Alternative are contained in the
appendices to this announcement as follows:
- Appendix II - Further details on Holdco, Intermediate Holdco 1,
Intermediate Holdco 2, the Bidco Group and the Holdco Group Securities; and
- Appendix III - Holdco Group Securities Risk Factors.
Further details of the Holdco Group Securities Alternative and a valuation of
the Holdco Group Securities will be contained in the Scheme Document.
4 Background to and reasons for recommending the Acquisition
Background
In July 2008, Inspired raised GBP40 million through the issue of convertible
preference shares. The net proceeds of the fundraising were used to fund the
costs of exiting the loss-making pubs division (amounting to a total of
approximately GBP20 million), to repay approximately GBP10 million of bank
borrowings and to fund additional capital expenditure. Immediately following
this fundraising, the Inspired Group had net debt of approximately GBP47.7
million and as at 31 March 2010, the Inspired Group had net debt of
approximately GBP59.4 million.
The Inspired Group's operations are highly cash generative but its business
model requires a relatively high degree of capital expenditure for the
replacement of the Inspired Group's machines on contract renewals and for new
growth. Whilst the Executive Managers and the Management Team have made good
progress in identifying growth opportunities that do not require capital
expenditure and in obtaining vendor financing, the majority of the current
growth opportunities available to the Inspired Group require Inspired to
purchase the machines. In addition, a number of the Inspired Group's current
contracts are very likely to require additional capital expenditure on their
renewal.
Under the terms of the Inspired Group's current bank facilities, it is required
to make capital repayments of approximately GBP30.5 million by 30 September
2012. These capital repayments, together with the ongoing interest payments,
will restrict the Inspired Group's ability to fund the capital expenditure
required to grow the business and to take on new customer contracts.
Consequently, in order to take advantage of available growth opportunities, the
Inspired Board is of the view that significant additional finance will be
required. Given the current and reasonably foreseeable market and economic
conditions, the Inspired Board believes that such additional funding would be
very difficult to secure. In particular, the Inspired Board believes that it
would be difficult to complete an equity fundraising of sufficient size on
satisfactory terms and that there is no guarantee that Inspired Shareholders
would be supportive of such a fundraising.
The Inspired Board has also investigated a sale of either or both of the
Inspired Group's Server-Based Gaming (SBG) and Leisure Divisions to reduce the
Inspired Group's gearing. Based on the results of these investigations, the
Inspired Board do not believe that a sale of the Leisure Division would have
improved the Inspired Group's financial covenant ratios or that an appropriate
level of cash consideration would be secured from any potential buyer of either
of those divisions.
Without access to sufficient capital to expand the business, the Inspired Board
does not believe that the Inspired Group would be able to take full advantage of
the growth opportunities available to it and would be restricted to pursuing
mainly vendor-financed deals and less capital-intensive growth opportunities.
In view of the Management Arrangements with those directors of Inspired who are
Executive Managers, and Russell Hoyle's engagement as an adviser to Vitruvian, a
committee of the Inspired Board comprising the Independent Directors, who are
not regarded as having a conflict of interest in relation to the Acquisition,
has been formed, and Evolution Securities has been appointed to advise them in
considering the terms of the Acquisition. The committee of Independent Directors
has been chaired by Julian Paul and has noted and given due regard to
Christopher Mills' employment by the J O Hambro Capital Management Group of
companies which manage funds that, as at 30 April 2010, being the latest
practicable Business Day prior to the date of this announcement, were interested
in approximately 18.58 per cent. of the entire issued share capital of Inspired.
In assessing the terms of the Acquisition, the Independent Directors have also
considered the risks that are inherent in Inspired's business model. These
include possible changes in the regulation of gaming, the taxation of the
Inspired Group's products and services and the impact of the current economic
environment on consumer spending. A change in any of these factors could result
in a deterioration in Inspired's financial position.
The Acquisition offers Inspired Shareholders the opportunity to realise their
investment in Inspired in cash, at a premium to the prevailing market price and
avoids the possibility of them being diluted by an equity issue or of them
seeing the Inspired Group's growth prospects restricted by a lack of available
cash resources for expansion.
The Acquisition values the Inspired Shares in issue at the close of business on
30 April 2010, the last Business Day prior to the date of this announcement, at
approximately GBP74.4 million, which represents a premium of approximately 123.6
per cent. to the combined value of the then issued Old Ordinary Shares and
Convertible Preference Shares at the close of business on 27 July 2009, being
the last Business Day prior to the commencement of the Offer Period.
Note: The Old Ordinary Shares and the Convertible Preference Shares became
Inspired Shares pursuant to a share capital reorganisation completed on 27
November 2009.
The Acquisition price of 60 pence per Inspired Share in cash represents a
premium of approximately:
i) 21.2 per cent. to the Closing Price of 49.50 pence on 30 April 2010,
being the last Business Day prior to the date of this announcement; and
ii) 31.7 per cent. to the average Closing Price of 45.56 pence for the
three months ended 30 April 2010, being the last Business Day prior to the date
of this announcement.
Given the funding constraints in the public markets and the business risks, the
Independent Directors believe that the Acquisition provides Inspired
Shareholders with a far more certain return than any of the other options
available to the Inspired Group in the short or medium term.
Recommendation
The Independent Directors, who have been so advised by Evolution Securities,
consider the terms of the Acquisition which offers cash consideration to
Inspired Shareholders, to be fair and reasonable. In providing its advice to the
Independent Directors, Evolution Securities has taken into account the
commercial assessment of the Independent Directors. Accordingly, the
Independent Directors intend to recommend that Inspired Shareholders vote in
favour of the Acquisition at the Court Meeting and the General Meeting, as the
Independent Directors (and their immediate families and related trusts) have
irrevocably undertaken to do in respect of their entire beneficial holding of
654,938 Inspired Shares, representing approximately 0.53 per cent. of the entire
issued share capital of Inspired.
The Independent Directors are Making No Recommendation With Respect to the
Holdco Group Securities Alternative
As an alternative to the cash consideration available under the terms of the
Acquisition, Bidco intends to make available to eligible Independent Inspired
Shareholders, the option of electing for the Holdco Group Securities
Alternative, further details of which are set out in paragraph 3 of Appendix II
to this announcement. The Holdco Group Securities Alternative is not the subject
of a recommendation by the Independent Directors.
In coming to the view that the Holdco Group Securities Alternative should not be
subject to a recommendation, the Independent Directors have carefully considered
the risks that have been identified by Bidco in relation to the Holdco Group
Securities, and which are set out in Appendix III to this announcement. They
note in particular that the Holdco Group Securities will not be listed on any
stock exchange and that it is not envisaged that there will be any trading
facility in respect of them. In addition, there will be significant restrictions
on the transferability of Holdco Group Securities and reduced information rights
and shareholder protections compared to those currently afforded to Inspired
Shareholders.
However, the Independent Directors also recognise the fact that the Holdco Group
Securities Alternative does offer eligible Independent Inspired Shareholders the
ability to retain some ongoing equity participation in Inspired. If eligible
Independent Inspired Shareholders do intend to make use of this opportunity,
they are strongly advised to seek their own independent financial, tax and legal
advice before electing to participate in the Holdco Group Securities Alternative
due to its complex nature and the risks identified.
5 Background to and reasons for the Acquisition
Vitruvian believes that the Executive Managers and the Management Team have
recently overseen a successful transformation of Inspired and intends to support
them in realising their plans for the Company.
In particular, the Executive Managers and the Management Team have identified a
number of attractive development opportunities which Bidco intends to support to
reinforce Inspired's leading position in the markets in which it operates and to
enhance its prospects for future growth. Given the medium term investment
horizon required to pursue this strategy, Vitruvian believes that the next stage
of Inspired's development would best be achieved under private ownership.
6 Irrevocable undertakings
Bidco has received irrevocable undertakings from the Executive Managers who are
Inspired Shareholders and certain members of the Management Team (and a related
trust) to vote in favour of the Resolutions (excluding the Ordinary Resolution)
in respect of a total of 1,595,856 Inspired Shares, representing approximately
1.29 per cent. of the existing issued ordinary share capital of Inspired.
Bidco has received an irrevocable undertaking to vote in favour of the
Resolutions from Russell Hoyle in respect of a total of 594,663 Inspired Shares,
representing approximately 0.48 per cent. of the existing issued share capital
of Inspired.
Bidco has also received irrevocable undertakings to vote in favour of the
Acquisition and the Resolutions in respect of a total of 60,051,889 Independent
Inspired Shares, representing approximately 48.40 per cent. of the existing
issued Independent Inspired Shares.
Bidco has also received letters of intent to vote in favour of the Acquisition
and the Resolutions in respect of a total of 7,272,903 Independent Inspired
Shares, representing approximately 5.86 per cent. of the existing issued
Independent Inspired Shares.
In aggregate, therefore, Bidco has received irrevocable undertakings and letters
of intent to vote in favour of the Acquisition and the Resolutions in respect of
a total of 67,324,792 Independent Inspired Shares, representing approximately
54.26 per cent. of the existing issued Independent Inspired Shares.
Further details of these irrevocable undertakings and letters of intent are set
out in Appendix V to this announcement and will be set out in the Scheme
Document.
7 Information on Inspired
Inspired is a leading operator in the Open Server-Based Gaming ("Open SBG")
software systems market and is also a leading provider of analogue and Open SBG
machines in the UK for the leisure and gaming markets. The Inspired Group
operates four divisions:
- Betting and Street Gaming
- Casino and Bingo
- Leisure
- Virtual Racing Systems
Inspired currently provides Open SBG software systems and Open SBG digital and
networked terminals in seven countries. Inspired manages approximately 45,000
machines across the UK and 1,000 internationally.
Inspired's customer base includes casinos, bingo halls, licensed betting
offices, holiday parks and other out-of-home leisure venues. Key customers
include leisure and gaming companies such as William Hill, Bourne Leisure and
Gala Coral Group.
8 Current Trading
Current trading remains solid across all four of Inspired's divisions with
consumer demand proving resilient. Trading in the Inspired Group's Leisure
Projects division is heavily weighted to the second half of the financial year
and whilst this period is yet to occur, the Inspired Board remains confident of
a creditable outcome for the year based on Inspired's long term contracts and
established trading patterns.
9 Information on Vitruvian
Vitruvian is an independent private equity firm that specialises in
middle-market buyouts, growth buyouts and growth capital investments in the
United Kingdom and elsewhere in Northern Europe. Vitruvian investment
professionals' experience as principals in the investment industry dates back to
1990 and demonstrates an ability to invest successfully over multiple market
cycles throughout a spectrum of industries.
Vitruvian aims to invest in companies across northern Europe including the
United Kingdom, Eire, Germany, the Nordic Region, the Netherlands, Belgium,
Switzerland and Austria. Vitruvian focuses on investments in faster-moving, less
capital intensive industries such as media, information technology, telecoms,
financial services, business services and leisure.
Vitruvian acts as discretionary manager to the Vitruvian Fund which comprises
total commitments of EUR925 million. The Vitruvian Fund closed to new commitments
in February 2008. Vitruvian's investment focus is on companies operating in
'dynamic situations' where there is an opportunity to build strategic value in
such businesses as they go through significant change.
The Vitruvian Fund targets investments of EUR15 million to EUR150 million, typically
in the sectors referred to above.
10 Information on Bidco, its financing and arrangements with the Executive
Managers and the Management Team
Bidco is a newly incorporated company which is controlled by investment
partnerships advised by Vitruvian and has been formed for the purposes of making
the Acquisition.
The Bidco Directors believe that the ongoing participation in the continued
growth of the Inspired Group by the Executive Managers and the Management Team
is very important, due to their existing relationships with customers and
suppliers. Therefore the Executive Managers have reached agreement with Bidco
and Holdco in relation to the Management Arrangements under which, inter alia,
it is anticipated that they and the Management Team will invest, in aggregate,
approximately GBP70,400 in shares in Holdco which will give them an economic
entitlement to approximately 10 per cent of the equity in Holdco. That equity
will be entitled to benefit from a ratchet, further details of which are set out
in Appendix II to this announcement. Further details of Bidco's holding company
structure will be set out in the Scheme Document.
The Executive Managers and the Management Team will remain in place to operate
Inspired once the Scheme becomes effective on the basis of their current service
contracts, subject to certain agreed amendments. The salaries of the Executive
Managers and the Management Team will remain unchanged.
Inspired will propose the Ordinary Resolution at the General Meeting, to be
voted on by way of poll, pursuant to which Independent Inspired Shareholders
will be asked to approve the arrangements made and to be made between Bidco,
Holdco, the Executive Managers and the Management Team. None of the Executive
Managers nor any member of the Management Team will be entitled to vote on this
resolution nor the resolution to approve the Scheme to be proposed at the Court
Meeting.
Those Executive Managers who are Inspired Shareholders and certain members of
the Management Team have given certain irrevocable undertakings to Bidco in
connection with the Acquisition. In addition, these individuals have each
undertaken not to solicit, initiate or continue discussions (except where
required under the City Code or by statutory or fiduciary duty, the Panel and
any applicable laws and regulations) with any competing offeror for Inspired.
The Acquisition is subject to, among other things, the approval of the
Independent Inspired Shareholders of the Management Arrangements. Evolution
Securities considers the proposed terms of the Management Arrangements to be
fair and reasonable as far as the Independent Inspired Shareholders are
concerned.
Bidco considers the Management Arrangements to be critical to the success of the
Acquisition and therefore if the Independent Inspired Shareholders do not pass
the Ordinary Resolution at the General Meeting approving these arrangements,
Bidco may (at its absolute discretion) seek to invoke Condition 1(iii) of Part A
of Appendix I to this announcement, which would result in the Acquisition being
withdrawn. Further details of the Management Arrangements will be set out in the
Scheme Document.
Bidco has not traded since its date of incorporation, nor has it entered into
any obligations other than in connection with the Acquisition and the financing
of the Acquisition. The current Bidco Directors are Vitruvian Directors I
Limited, Vitruvian Directors II Limited and Philip Russmeyer. Ian Riley and Ben
Johnson have been appointed by Vitruvian Directors I Limited and Vitruvian
Directors II Limited, respectively, to act as their representatives in attending
board meetings of Bidco.
The Bidco Group will be financed using a combination of equity and debt. The
Vitruvian Fund will provide up to approximately GBP104.5 million of equity
funding, in addition to the financial commitment by the Executive Managers and
the anticipated financial commitment by the Management Team of, in aggregate,
GBP70,400. The exact amount of the Vitruvian Fund's commitment will depend on
the extent to which eligible Independent Inspired Shareholders elect to receive
the Holdco Group Securities Alternative. To finance part of the consideration
due under the terms of the Acquisition and to pay certain fees and expenses
associated with the Acquisition, the Bidco Group has in place approximately
GBP50 million of debt financing under committed facilities arranged and fully
underwritten by Ares Capital Europe Limited and Haymarket Financial Luxembourg 3
SARL and their respective affiliates. In addition, Bidco will have GBP20 million
of committed working capital and capex facilities.
Altium has confirmed that it is satisfied that sufficient resources are
available to Bidco to satisfy in full the cash consideration payable pursuant to
the Acquisition. Further details on the financing of the Acquisition will be set
out in the Scheme Document.
11 Directors, management and employees
The Bidco Directors have given assurances to the Independent Directors that,
following the Scheme becoming effective, the existing employment rights,
including pension rights, of all employees of Inspired will be fully
safeguarded. The Bidco Directors have confirmed to the Independent Directors
that Bidco's plans for the Inspired Group do not involve any immediate change to
the continued employment or the terms and conditions of employment of the
Inspired Group employees nor are there currently any plans to change the
principal locations of Inspired's business.
Following the successful implementation of the Acquisition, Luke Alvarez and
James O'Halleran will continue as executive directors of Inspired.
The Independent Directors and Russell Hoyle have each undertaken to resign from
the board of Inspired upon the Scheme becoming effective.
12 Inspired Share Schemes
As the outstanding options under the Inspired 2006 Share Option Plan have an
exercise price which is significantly higher than the cash consideration per
Inspired Share under the Acquisition, it is not expected that these options will
be exercised prior to the Scheme Effective Date. In respect of outstanding
nil-cost options under the Inspired 2006 Share Option Plan in respect of which
the performance conditions have not been met, the Remuneration Committee of the
Inspired Board has resolved not to exercise its discretion under the rules of
the Inspired 2006 Share Option Plan to waive any of the outstanding conditions,
and those options will therefore not vest. All options granted under the
Inspired 2006 Share Option Plan will cease to be exercisable on the Scheme
Effective Date and will lapse to the extent unexercised by the date which is six
months after the date on which the Scheme is sanctioned by the Court.
The exercise price of all options outstanding under the Inspired Savings Related
Share Option Scheme is higher than the cash consideration per Inspired Share
under the Acquisition. Therefore it is not expected that any outstanding options
under the Inspired Savings Related Share Option Scheme will be exercised prior
to the Scheme Effective Date. These options will lapse on the Scheme Effective
Date.
Participants in the Inspired Share Schemes will receive further details of the
effect of the Acquisition on their outstanding options in separate letters which
will be despatched to them in due course.
13 Disclosure of interests in Inspired
Save as set out below and for the Inspired Shares specified in the irrevocable
undertakings referred to in paragraph 6 above, as at the close of business on 30
April 2010, being the latest practicable Business Day prior to the date of this
announcement, neither Bidco nor any of the Bidco Directors nor Vitruvian, nor,
so far as Bidco is aware, any person acting in concert with Bidco has: (i) any
interest in or right to subscribe for any Inspired Shares, nor (ii) any short
positions in respect of Inspired Shares (whether conditional or absolute and
whether in the money or otherwise), including any short position under a
derivative, any agreement to sell or any delivery obligation or right to require
another person to purchase or take delivery, nor (iii) borrowed or lent any
Inspired Shares (save for any borrowed shares which have been on-lent or sold).
+--------------------------------+----------------+
| Name | No. of |
| | Inspired |
| | Shares |
+--------------------------------+----------------+
| Lee Gregory | 925 |
+--------------------------------+----------------+
| Matt Ingram | 84 |
+--------------------------------+----------------+
| Martin Lucas | 833 |
+--------------------------------+----------------+
14 Inducement Fee Agreement
Inspired has entered into an inducement fee agreement with Vitruvian (on behalf
of Bidco) under which Inspired has given various undertakings to Vitruvian,
including an undertaking that it will not solicit or initiate any possible offer
for Inspired or any other transaction which is inconsistent with, or an
alternative to, the Acquisition.
As an inducement to Vitruvian to pursue its discussions with Inspired in
relation to a possible offer, Inspired has agreed under the inducement fee
agreement to pay an inducement fee to Vitruvian of one per cent. of the value of
the Acquisition (inclusive of any irrecoverable VAT), calculated on a fully
diluted basis. The inducement fee will be payable if, in summary:
· an Independent Inconsistent Transaction is announced before the
Acquisition becomes effective or lapses and such Independent Inconsistent
Transaction subsequently becomes or is declared unconditional in all respects or
otherwise completes or becomes effective; or
· the Independent Directors announce that they are recommending or
approving an Independent Inconsistent Transaction; or
· the Independent Directors withdraw their recommendation of the
Acquisition or alter or qualify their recommendation; or
· the Independent Directors refuse to put forward the Scheme to the
Inspired Shareholders; or
· Inspired enters into an inducement fee arrangement or similar in
respect of an Independent Inconsistent Transaction.
15 Structure of the Acquisition
The Acquisition is expected to be effected by means of a scheme of arrangement
between Inspired and the Inspired Shareholders under Part 26 of the Companies
Act 2006. This procedure involves an application by Inspired to the Court to
sanction the Scheme and to confirm the cancellation of the Scheme Shares.
The implementation of the Scheme will be subject to the Conditions and certain
further terms referred to in Appendix I to this announcement and to be set out
in the Scheme Document. To become effective, the Scheme will require, amongst
other things, the following events to occur:
· a resolution to approve the Scheme being passed by a simple
majority in number of the Independent Inspired Shareholders present and voting
at the Court Meeting (or at an adjournment thereof), either in person or by
proxy, representing not less than 75 per cent. in value of Scheme Shares voted
at the Court Meeting (or at any adjournment thereafter);
· a special resolution to approve and implement the Scheme, the
Capital Reduction, amendments to the articles of association of Inspired, and
re-registration of Inspired as a private limited company being passed at the
General Meeting;
· an ordinary resolution to approve the arrangements made and to be
made between Bidco, Holdco, the Executive Managers and the Management Team being
passed at the General Meeting; and
· the sanction of the Scheme and confirmation of the Capital
Reduction by the Court and office copies of the Court Orders being delivered to
the Registrar and, in the case of the Capital Reduction, such Court Order
together with the minute of the Capital Reduction being registered by the
Registrar.
Upon the Scheme becoming effective, it will be binding on all Inspired
Shareholders, irrespective of whether they attended or voted at the Court
Meeting or the General Meeting (and if they attended and voted, whether or not
they voted in favour).
It is expected that the Scheme Document will be posted by mid May 2010 and that
the Court Meeting and the General Meeting to approve the Acquisition will be
held in early June 2010. Subject to shareholder approval and the satisfaction or
waiver of the other Conditions, it is expected that the Scheme will become
effective in early July 2010.
Further details of the Scheme will be contained in the Scheme Document, which
will be posted to Inspired Shareholders as soon as practicable and in any event
within 28 days of this announcement, unless otherwise agreed with the Panel.
16 Implementation Agreement
Inspired and Bidco have entered into an implementation agreement which provides,
inter alia, for the implementation of the Scheme and related matters in
accordance with an agreed indicative timetable and contains certain assurances
and confirmations between the parties, including provisions to implement the
Scheme on a timely basis and governing the conduct of the business of the
Inspired Group.
The implementation agreement terminates in certain circumstances, including:
- if the Acquisition is not approved by the Independent Inspired
Shareholders;
- if the Acquisition has not become effective by 10 September 2010 or
such later date as Bidco and Inspired shall, with the consent of the Panel
agree; and
- by notice from either Bidco or Inspired in certain defined
circumstances.
Further details of the implementation agreement will be set out in the Scheme
Document.
17 Cancellation of admission to trading on AIM
The London Stock Exchange will be requested to cancel the admission to trading
of Inspired Shares on AIM when the Acquisition becomes effective. The last day
of dealings in Inspired Shares on AIM is expected to be on the business day
immediately prior to the Scheme Effective Date and no transfers of Inspired
Shares will be registered after 6.00 p.m. on that date. On the Scheme Effective
Date, share certificates in respect of Inspired Shares will cease to be valid
and should be destroyed. In addition, entitlements to Inspired Shares held
within the CREST system will be cancelled on the Scheme Effective Date.
18 Overseas shareholders
The availability of the Acquisition or the distribution of this announcement to
persons who are not resident in the United Kingdom may be affected by the laws
of the relevant jurisdictions in which they are located. Persons who are not
resident in the United Kingdom should inform themselves of, and observe, any
applicable requirements.
This announcement is for information purposes only and is not intended to and
does not constitute or form part of an offer to sell or invitation to purchase
any securities or the solicitation of any vote for approval in any jurisdiction,
nor shall there be any sale, issue or transfer of the securities referred to in
this announcement in any jurisdiction in contravention of applicable law. The
Scheme will be put to Inspired Shareholders solely through the Scheme Document,
and, in the case of certificated Inspired Shares, the Forms of Proxy and the
Forms of Election, which will together contain the full terms and conditions of
the Acquisition, including details of how to vote in favour of the Acquisition.
Any response in relation to the Acquisition should be made only on the basis of
the information contained in the Scheme Document, the Forms of Proxy and Form of
Election or any other document by which the Acquisition is made.
The Holdco Group Securities have not been, and will not be, registered under the
U.S. Securities Act or under the applicable securities laws of any state,
district or other jurisdiction of the United States, Canada, South Africa,
Australia, Japan or of any other Restricted Jurisdiction, and no regulatory
clearances in respect of the Holdco Group Securities has been, or will be,
applied for in any jurisdiction. Accordingly, unless an exemption under the U.S.
Securities Act or other relevant securities laws is applicable, the Holdco Group
Securities are not being, and may not be, offered, sold, resold, delivered or
distributed, directly or indirectly, in or into the United States or any other
Restricted Jurisdiction or to any resident or citizen of a Restricted
Jurisdiction.
19 Enquiries
+-------------------------------------------------------------------+----------+
| Bidco: Tel: 020 7518 2800 | |
| Ian Riley | |
| Ben Johnson | |
| | |
| Altium Capital Limited (Financial Adviser Tel: 020 7484 4040 | |
| to Bidco): | |
| Stephen Georgiadis | |
| Tim Richardson | |
| | |
| Financial Dynamics (PR Advisers to Tel: 020 7831 3113 | |
| Bidco): | |
| Charles Palmer | |
| | |
| Inspired Gaming Group Plc: Tel: 07836 700401 | |
| Russell Hoyle | |
| | |
| Evolution Securities Limited (Financial Adviser and Nominated | |
| Adviser to Inspired): | |
| Stuart Andrews Tel: 020 7071 4300 | |
| Sam Plumptre | |
| Speed Communications (PR Advisers to | |
| Inspired): Tel: 020 7842 3200 | |
| Lucy Buckley | |
| | |
| | |
+-------------------------------------------------------------------+----------+
20 Further Information
Your attention is drawn to the further information in the Appendices which form
part of this announcement. Appendix I to this announcement contains the
conditions to, and certain further terms of, the Acquisition. Appendix II
contains further details on Holdco, Intermediate Holdco 1, Intermediate Holdco
2, the Bidco Group and the Holdco Group Securities. Appendix III contains risk
factors connected to the Holdco Group Securities. Appendix IV contains further
details of the sources of information and bases of calculations set out in this
announcement. Appendix V contains further details of the irrevocable
undertakings and letters of intent in respect of the Acquisition and Appendix VI
contains definitions of certain expressions used in respect of the Acquisition,
in this announcement and in the attached summary.
The Scheme Document, containing further details of the Acquisition (including
notices of a Court Meeting and a General Meeting) together with Forms of Proxy
and Forms of Election, will be posted to Inspired Shareholders and, for
information only, to participants in the Inspired Share Schemes as soon as
practicable and in any event within 28 days of this announcement, unless
otherwise agreed with the Panel.
The Bidco Directors, their appointed representatives, and the members of the
investment committee of Vitruvian (all of whose names will be set out in the
Scheme Document) accept responsibility for the information contained in this
announcement save for the information for which the members of the investment
committee of Vitruvian alone accept responsibility, as set out below and the
information for which the directors of Inspired or the Independent Directors
accept responsibility, as set out below. To the best of the knowledge and belief
of the Bidco Directors, their appointed representatives and the members of the
investment committee of Vitruvian (who have taken all reasonable care to ensure
that such is the case), such information for which they are responsible is in
accordance with the facts and does not omit anything likely to affect the import
of such information.
The members of the investment committee of Vitruvian (all of whose names will be
set out in the Scheme Document) accept responsibility for the information
relating to Vitruvian and the Vitruvian Fund. To the best of the knowledge and
belief of the members of the investment committee of Vitruvian (who have taken
all reasonable care to ensure that such is the case), such information for which
they are responsible is in accordance with the facts and does not omit anything
likely to affect the import of such information.
The members of the Inspired Board (all of whose names will be set out in the
Scheme Document) accept responsibility for the information contained in this
announcement relating to Inspired, the Inspired Group and themselves and their
immediate families, related trusts and connected persons save for the
information for which the Independent Directors alone accept responsibility, as
set out below. To the best of the knowledge and belief of each of the members of
the Inspired Board (who have taken all reasonable care to ensure that such is
the case), such information for which they are responsible is in accordance with
the facts and does not omit anything likely to affect the import of such
information.
The Independent Directors accept responsibility for their recommendation of the
Acquisition contained in this announcement. To the best of the knowledge and
belief of the Independent Directors (who have taken all reasonable care to
ensure that such is the case), such information for which they are responsible
is in accordance with the facts and does not omit anything likely to affect the
import of such information.
Altium Capital Limited, which is authorised and regulated in the United Kingdom
by the Financial Services Authority, is acting exclusively for Bidco and
Vitruvian and no one else in connection with the Acquisition and will not be
responsible to anyone other than Bidco and Vitruvian for providing the
protections afforded to the clients of Altium Capital Limited, or for giving
advice in connection with the Acquisition, the contents of this announcement, or
the Forms of Proxy, or the Forms of Election or any matter referred to herein.
Evolution Securities Limited, which is authorised and regulated in the United
Kingdom by the Financial Services Authority, is acting exclusively for Inspired
and no one else in connection with the Acquisition and will not be responsible
to anyone other than Inspired for providing the protections afforded to the
clients of Evolution Securities Limited, or for giving advice in connection with
the Acquisition, the contents of this announcement, or the Forms of Proxy, or
the Forms of Election or any matter referred to herein.
The availability of the Acquisition or the distribution of this announcement to
persons who are not resident in the United Kingdom may be affected by the laws
of the relevant jurisdictions in which they are located. Persons who are not
resident in the United Kingdom should inform themselves of, and observe, any
applicable requirements. Any failure to comply with these restrictions may
constitute a violation of the securities laws of any such jurisdiction.
The Acquisition will not be made available, directly or indirectly, in or into
the United States or by use of the mails of, or by any means or instrumentality
(including, without limitation, facsimile or other electronic transmission,
telex or telephone) of inter-state or foreign commerce of, or any facility of, a
national, state or other securities exchange of, the United States, nor will it
be made available directly or indirectly in or into Canada, South Africa,
Australia or Japan, and no person may vote in favour of the Acquisition by any
such use, means, instrumentality or facility or from within the United States,
Canada, South Africa, Australia or Japan or any other such jurisdiction if to do
so would constitute a violation of the relevant laws of such jurisdiction.
Accordingly, copies of this announcement, the Scheme Document, the Forms of
Proxy and the Forms of Election are not being, will not be and must not be
mailed or otherwise forwarded, distributed or sent in, into or from the United
States, Canada, South Africa, Australia or Japan or any other such jurisdiction
if to do so would constitute a violation of the relevant laws of such
jurisdiction, and persons receiving this press announcement, the Scheme
Document, the Forms of Proxy and the Forms of Election (including without
limitation custodians, nominees and trustees) must not mail, forward, distribute
or send them in, into or from the United States, Canada, South Africa, Australia
or Japan or any other such jurisdiction if to do so would constitute a violation
of the relevant laws of such jurisdiction.
The Acquisition will be subject to the applicable rules and regulations of the
London Stock Exchange and the City Code.
Forward Looking Statements
This announcement contains statements that are or may be forward looking
statements. All statements other than statements of historical facts included in
this announcement may be forward looking statements. Without limitation, any
statements preceded or followed by or that include the words "targets", "plans",
"believes", "expects", "aims", "intends", "will", "should", "could", "would",
"may", "anticipates", "estimates", "synergy", "cost-saving", "projects", "goal"
or "strategy" or, words or terms of similar substance or the negative thereof,
are forward looking statements. Forward looking statements include statements
relating to the following: (i) future capital expenditures, expenses, revenues,
earnings, synergies, economic performance, indebtedness, financial condition,
dividend policy, losses and future prospects; (ii) business and management
strategies and the expansion and growth of Bidco's or Inspired's operations and
potential synergies resulting from the Acquisition; and (iii) the effects of
government regulation on Bidco's or Inspired's business.
These forward looking statements are not guarantees of financial performance.
They have not been reviewed by the auditors of Bidco or Inspired. Such forward
looking statements involve known and unknown risks and uncertainties that could
significantly affect expected results and are based on certain key assumptions.
Many factors could cause actual results to differ materially from those
projected or implied in any forward looking statements. Due to such
uncertainties and risks, readers are cautioned not to place undue reliance on
such forward looking statements, which speak only as of the date hereof. All
subsequent oral or written forward looking statements attributable to Bidco or
Inspired or any of their respective members, directors, officers or employees or
any persons acting on their behalf are expressly qualified in their entirety by
the cautionary statement above. Bidco and Inspired disclaim any obligation to
update any forward looking or other statements contained herein, except as
required by applicable law.
Dealing Disclosure Requirements
Under Rule 8.3(a) of the Code, any person who is interested in 1% or more of any
class of relevant securities of an offeree company or of any paper offeror
(being any offeror other than an offeror in respect of which it has been
announced that its offer is, or is likely to be, solely in cash) must make an
Opening Position Disclosure following the commencement of the offer period and,
if later, following the announcement in which any paper offeror is first
identified. An Opening Position Disclosure must contain details of the person's
interests and short positions in, and rights to subscribe for, any relevant
securities of each of (i) the offeree company and (ii) any paper offeror(s). An
Opening Position Disclosure by a person to whom Rule 8.3(a) applies must be made
by no later than 3.30 pm (London time) on the 10th business day following the
commencement of the offer period and, if appropriate, by no later than 3.30 pm
(London time) on the 10th business day following the announcement in which any
paper offeror is first identified. Relevant persons who deal in the relevant
securities of the offeree company or of a paper offeror prior to the deadline
for making an Opening Position Disclosure must instead make a Dealing
Disclosure.
Under Rule 8.3(b) of the Code, any person who is, or becomes, interested in 1%
or more of any class of relevant securities of the offeree company or of any
paper offeror must make a Dealing Disclosure if the person deals in any relevant
securities of the offeree company or of any paper offeror. A Dealing Disclosure
must contain details of the dealing concerned and of the person's interests and
short positions in, and rights to subscribe for, any relevant securities of each
of (i) the offeree company and (ii) any paper offeror, save to the extent that
these details have previously been disclosed under Rule 8. A Dealing Disclosure
by a person to whom Rule 8.3(b) applies must be made by no later than 3.30 pm
(London time) on the business day following the date of the relevant dealing.
If two or more persons act together pursuant to an agreement or understanding,
whether formal or informal, to acquire or control an interest in relevant
securities of an offeree company or a paper offeror, they will be deemed to be a
single person for the purpose of Rule 8.3.
Opening Position Disclosures must also be made by the offeree company and by any
offeror and Dealing Disclosures must also be made by the offeree company, by any
offeror and by any persons acting in concert with any of them (see Rule 8.1, 8.2
and 8.4).
Details of the offeree and offeror companies in respect of whose relevant
securities Opening Position Disclosures and Dealing Disclosures must be made can
be found in the Disclosure Table on the Takeover Panel's website at
www.thetakeoverpanel.org.uk, including details of the number of relevant
securities in issue, when the offer period commenced and when any offeror was
first identified. If you are in any doubt as to whether you are required to
make an Opening Position Disclosure or a Dealing Disclosure, you should contact
the Panel's Market Surveillance Unit on +44 (0)20 7638 0129.
A copy of this announcement will be available on Inspired's website
http://www.inspiredgaminggroup.com.
APPENDIX I
CONDITIONS AND FURTHER TERMS OF THE ACQUISITION
Part A: The Conditions
1. The Acquisition will, if it is implemented by way of the Scheme, be
conditional upon the Scheme becoming unconditional and becoming effective,
subject to the City Code, by not later than 10 September 2010 or such later date
(if any) as Bidco and Inspired may, with the consent of the Panel, agree and (if
required) the Court may allow.
The Scheme will be conditional upon:
(i) the approval of the Scheme by a majority in number representing
three-fourths or more in value of the Independent Inspired Shareholders present
and voting, either in person or by proxy, at the Court Meeting(s) (or at any
adjournment thereof);
(ii) the special resolution in connection with and required to approve
and implement the Scheme and the Capital Reduction and set out in the notice of
the General Meeting being duly passed by the requisite majority at the General
Meeting (or at any adjournment thereof);
(iii) the ordinary resolution in connection with and required to approve
and implement the arrangements made and to be made between the Executive
Managers, the Management Team and Bidco set out in the notice of the General
Meeting being duly passed by the requisite majority at the General Meeting (or
at any adjournment thereof);
(iv) the sanction of the Scheme (without modification, or with such
modifications as are agreed by Bidco and Inspired) and the confirmation of the
Capital Reduction by the Court and office copies of the Court Orders and the
minute of such reduction attached thereto being delivered for registration to
the Registrar of Companies and, in relation to the Capital Reduction, being
registered by the Registrar of Companies.
2. In addition, Inspired and Bidco have agreed that, subject as stated
in Part B below, application to the Court to sanction the Scheme and to confirm
the Capital Reduction will not be made and the office copies of the Court Orders
and the minute of such reduction attached thereto will not be delivered for
registration to the Registrar of Companies unless conditions 1(i) to (iii)
inclusive above have been fulfilled and unless immediately prior to the hearing
of the petition to sanction the Scheme the following conditions (as amended if
appropriate) have been (and continue to be) satisfied pending the commencement
of that hearing or waived as referred to below:
(a) no Third Party having intervened and there not continuing to be outstanding
any statute, regulation, notice, decision or order of any Third Party in each
case which would or might reasonably be expected to:
(i) make the Acquisition, its implementation or the acquisition or the
proposed acquisition by Bidco or any member of the Wider Bidco Group of any
shares or other securities in, or control or management of, Inspired or any
member of the Wider Inspired Group void, illegal or unenforceable in any
jurisdiction, or otherwise directly or indirectly restrain, prevent, prohibit,
restrict, delay or otherwise materially adversely interfere with the same or
impose additional conditions or obligations with respect to the Acquisition (or
its implementation) or such acquisition, or otherwise impede, challenge or
interfere with the Acquisition (or its implementation) or such acquisition, or
require material adverse amendment to the terms of the Acquisition or the
acquisition or proposed acquisition of any Inspired Shares or the acquisition of
control or management of Inspired or any member of the Wider Inspired Group by
Bidco or any member of the Wider Bidco Group;
(ii) materially limit or delay the ability of any member of the Wider Bidco
Group or any member of the Wider Inspired Group to acquire or to hold or to
exercise effectively, directly or indirectly, all or any rights of ownership in
respect of shares or other securities (or the equivalent) in, or to exercise
voting or management control over, any member of the Wider Inspired Group or any
member of the Wider Bidco Group, as the case may be, taken as a whole;
(iii) require, prevent or materially delay any divestiture or alter the terms
envisaged for any proposed divestiture by any member of the Wider Bidco Group of
any shares or other securities in Inspired or any member of the Wider Inspired
Group (in any case to an extent which is material in the context of the Wider
Bidco Group or the Wider Inspired Group, as the case may be, taken as a whole);
(iv) require, prevent or materially delay any divestiture or alter the terms
envisaged for any proposed divestiture by any member of the Wider Bidco Group or
by any member of the Wider Inspired Group of all or any part of their respective
businesses, assets or properties or limit the ability of any of them to conduct
all or any part of their respective businesses or to own or control any of their
respective assets or properties or any part thereof (in any case to an extent
which is material in the context of the Wider Bidco Group or the Wider Inspired
Group, as the case may be, taken as a whole);
(v) other than in connection with the implementation of the Acquisition,
require any member of the Wider Bidco Group or of the Wider Inspired Group to
subscribe for or acquire, or to offer to subscribe for or acquire, any shares or
other securities (or the equivalent) or interest in any member of the Wider
Inspired Group or the Wider Bidco Group;
(vi) materially limit the ability of any member of the Wider Bidco Group or
of the Wider Inspired Group to integrate or co-ordinate its business, or any
part of it, with the businesses or any part of the businesses of any other
member of the Wider Bidco Group and/or of the Wider Inspired Group in each case
in a manner which is material in the context of the Acquisition, or as the case
may be, in the context of the Wider Bidco Group or the Wider Inspired Group, as
the case may be, taken as a whole;
(vii) result in any member of the Wider Bidco Group or the Wider Inspired
Group ceasing to be able to carry on business under any name under which it
presently does so (in any case to an extent which is material in the context of
the Wider Bidco Group or the Wider Inspired Group, as the case may be, taken as
a whole), including, without limitation, any indication from the UK Gambling
Commission that it is unlikely to permit any licence (including any operating
licence) held by any member of the Wider Inspired Group to continue to have
effect following the Acquisition which licence(s) is material in the context of
the Wider Bidco Group or the Wider Inspired Group, as the case may be, taken as
a whole; or
(viii) otherwise adversely affect the business, assets, profits, financial or
trading position or prospects of any member of the Wider Bidco Group to a
material extent, or, of the Wider Inspired Group, taken as a whole, to a
material extent,
and all applicable waiting and other time periods during which any Third Party
could intervene under any applicable legislation or regulation of any relevant
jurisdiction having expired, lapsed or been terminated (as the case may be);
(b) all material notifications, filings and/or applications which are
necessary having been made, all appropriate waiting and other time periods
(including any extensions of such waiting and other time periods) under any
applicable legislation or regulation of any relevant jurisdiction having
expired, lapsed or terminated (as appropriate) and all statutory or regulatory
obligations in any relevant jurisdiction having been complied with, in each case
in connection with the Acquisition or the acquisition or proposed acquisition of
any shares or other securities in, or control of, Inspired or any other member
of the Wider Inspired Group by any member of the Wider Bidco Group or the
carrying on by any member of the Wider Inspired Group of its business;
(c) all Authorisations which are necessary in any relevant jurisdiction
for or in respect of the Acquisition (or its implementation) or the acquisition
or proposed acquisition of any shares or other securities in, or control or
management of, Inspired or any other member of the Wider Inspired Group by Bidco
or any member of the Wider Bidco Group or the carrying on by any member of the
Wider Inspired Group of its business having been obtained, in terms and in a
form satisfactory to Bidco, acting reasonably, from all appropriate Third
Parties or from any persons or bodies with whom any member of the Wider Bidco
Group or any member of the Wider Inspired Group has entered into contractual
arrangements and such Authorisations together with all authorisations necessary
for any member of the Wider Inspired Group to carry on its business remaining in
full force and effect, and there being no notice or other intimation of any
intention to revoke, suspend, restrict, modify or not to renew any of the same
having been made in connection with the Acquisition or any other matter
directly, or indirectly, arising from the Acquisition (or its implementation),
in each case where the absence of such Authorisation would have a material
adverse effect on the Wider Inspired Group or the Wider Bidco Group taken as a
whole and all necessary statutory or regulatory obligations in any relevant
jurisdiction having been complied with;
(d) save as Disclosed, there being no provision of any arrangement,
agreement, lease, licence, permit, franchise or other instrument to which any
member of the Wider Inspired Group is a party, or by or to which any such member
or any of its assets is or are or may be bound, entitled or subject, or any
circumstance, which, in each case as a consequence of the Acquisition (or its
implementation) or the acquisition or proposed acquisition of any shares or
other securities in, or control or management of, Inspired or any other member
of the Wider Inspired Group by any member of the Wider Bidco Group or otherwise,
could reasonably be expected to result in, in any case to an extent which is or
would be material in the context of the Wider Inspired Group taken as a whole:
(i) any monies borrowed by or any other indebtedness or liabilities (actual
or contingent) of, or any grant available to, any member of the Wider Inspired
Group being or becoming repayable or capable of being declared repayable
immediately or prior to its stated repayment date or the ability of any member
of the Wider Inspired Group to borrow monies or incur any indebtedness being
withdrawn or inhibited or becoming capable of being withdrawn or inhibited;
(ii) the creation or enforcement of any mortgage, charge or other security
interest over the whole or any part of the business, property, assets or
interests of any member of the Wider Inspired Group or any such mortgage, charge
or other security interest (wherever and whenever created, arising or having
arisen) becoming enforceable;
(iii) any such arrangement, agreement, lease, licence, permit, franchise or
instrument, or the rights, liabilities, obligations or interests of any member
of the Wider Inspired Group thereunder, being, or becoming capable of being,
terminated or adversely modified or affected or any adverse action being taken
or arising thereunder or any onerous obligation or liability arising thereunder;
(iv) any asset or interest of any member of the Wider Inspired Group or any
asset the use of which is enjoyed by any member of the Wider Inspired Group
being or falling to be disposed of or charged or ceasing to be available to any
member of the Wider Inspired Group 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 Inspired Group otherwise than in the
ordinary course of business;
(v) any member of the Wider Inspired Group ceasing to be able to carry on
business under any name under which it presently does so;
(vi) the creation or assumption of any liabilities (actual or contingent) by
any member of the Wider Inspired Group other than in the ordinary course of
business;
(vii) the rights, liabilities, obligations or interests of any member of the
Wider Inspired Group under any such arrangement, agreement, lease, licence,
permit, franchise or other instrument or the interests or business of any such
member in or with any other person, firm, company or body (or any agreements or
arrangements relating to any such interests or business) being terminated,
adversely modified or affected;
(viii) the financial or trading position or the prospects or the value of any
member of the Wider Inspired Group being prejudiced or adversely affected in any
manner; or
(ix) any member of the Wider Inspired Group being required to acquire or
repay any shares in and/or indebtedness of any member of the Wider Inspired
Group owned by or owed to any third party,
and no event having occurred which, under any provision of any such arrangement,
agreement, lease, licence, permit, franchise or other instrument to which any
member of the Wider Inspired Group is a party, or by or to which any such member
or any of its assets may be found entitled or subject, could result in any of
the events or circumstances which are referred to in paragraphs (i) to (ix) of
this condition (d) in any case to an extent which is or would be material in the
context of the Wider Inspired Group as a whole;
(e) save as Disclosed, no member of the Wider Inspired Group having since
26 September 2009, being the date to which the last published audited report and
accounts of Inspired were made up:
(i) issued or agreed to issue, or authorised 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 or convertible securities;
(ii) purchased or redeemed or repaid or proposed the purchase, redemption
or repayment of any of its own shares or other securities (or the equivalent) or
reduced or made or authorised any other change to any part of its share capital
other than pursuant to the implementation of the Acquisition;
(iii) recommended, declared, paid or made or proposed to recommend, declare,
pay or make any bonus issue in respect of shares, dividend or other
distribution, whether payable in cash or otherwise;
(iv) except as between Inspired and any of its wholly owned subsidiaries or
between such subsidiaries, made, authorised, proposed or announced an intention
to make, propose or authorise any change in its loan capital;
(v) merged with, demerged or acquired any body corporate, partnership or
business or acquired or disposed of or (other than in the ordinary course of
business) transferred, mortgaged or charged or created any security interest
over any material assets or any right, title or interest in any material assets
(including shares in any undertaking and trade investments) or authorised,
proposed or announced the same;
(vi) issued or authorised the issue of, or made any change in or to, any
debentures or, other than trade credit incurred in the ordinary course of
business, incurred or increased any indebtedness or liability (actual or
contingent) except as between Inspired and any of its wholly owned subsidiaries
or between such subsidiaries, which in any case is material in the context of
the Wider Inspired Group taken as a whole;
(vii) entered into, varied, authorised or announced its intention to enter
into or vary any agreement, transaction, arrangement or commitment (whether in
respect of capital expenditure or otherwise) which:
(A) is of a long term, onerous or unusual nature or magnitude or which is
or could reasonably be expected to involve an obligation of such nature or
magnitude;
(B) restricts or could reasonably be expected to restrict the business of
any member of the Wider Inspired Group; or
(C) is other than in the ordinary course of business,
and which in any case is material in the context of the Wider Inspired Group
taken as a whole;
(viii) entered into, implemented, effected or authorised any merger, demerger,
reconstruction, amalgamation, scheme, commitment or other transaction or
arrangement in respect of itself or another member of the Wider Inspired Group;
(ix) entered into or varied or made an offer (which remains open for
acceptance) to vary the terms of any contract, agreement, commitment or
arrangement with, any of the directors or senior executives of any member of the
Wider Inspired Group or changed or entered into any commitment to change the
terms of any of the Inspired Share Schemes save for salary increases and bonuses
not resulting in total annual remuneration of any individual exceeding the
immediately preceding year's remuneration by more than three per cent. or other
variations of terms in the ordinary course of business which are not material in
the context of the Acquisition or the Wider Inspired Group taken as a whole;
(x) taken any corporate action or had any step, application, filing in
court, notice or legal proceedings started, served, instituted or threatened
against it or petition presented or order made for its winding-up (voluntarily
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 and revenues or any analogous proceedings
in any jurisdiction which in any case is material in the context of the Wider
Inspired group taken as a whole;
(xi) 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 having entered into or taken steps to enter into a
moratorium, composition, compromise or arrangement with its creditors in respect
of its debts or ceased or threatened to cease carrying on all or a substantial
part of its business;
(xii) waived, settled or compromised any claim to an extent which is material
in the context of the Wider Inspired Group taken as a whole;
(xiii) terminated or varied the terms of any agreement or arrangement between
any member of the Inspired 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 or prospects of the Inspired Group;
(xiv) made any alteration to its memorandum or articles of association or
other incorporation documents save as required to implement the Acquisition;
(xv) put in place any pension schemes for its directors, employees or their
dependants or made or agreed or consented to any change to:
(A) the terms of the trust deeds constituting the pension schemes (if any)
established for its directors, employees or their dependants; or
(B) the benefits which accrue, or to the pensions which are payable,
thereunder; or
(C) the basis on which qualification for, or accrual or entitlement to, such
benefits or pensions are calculated or determined; or
(D) 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 including the appointment
of a trust corporation;
(xvi) 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 Inspired Group in
a manner which is material in the context of the Wider Inspired Group taken as a
whole; or
(xvii) entered into any contract, agreement, commitment or arrangement or
passed any resolution or made any offer (which remains open for acceptance) or
proposed or announced any intention with respect to any of the transactions,
matters or events referred to in this condition (e);
(f) since 26 September 2009, save as Disclosed:
(i) no adverse change or deterioration having occurred in the business,
assets, financial or trading position or profits or prospects of any member of
the Wider Inspired Group which in any case is material in the context of the
Wider Inspired Group taken as a whole;
(ii) no contingent or other liability of any member of the Wider Inspired
Group having arisen or become apparent to Bidco or increased which in any case
is material in the context of the Wider Inspired Group taken as a whole;
(iii) no litigation, arbitration proceedings, prosecution or other legal
proceedings to which any member of the Wider Inspired Group is or may become a
party (whether as plaintiff, defendant or otherwise) having been threatened,
announced, implemented or instituted by or against or remaining outstanding
against or in respect of any member of the Wider Inspired Group which in any
case is material in the context of the Wider Inspired Group taken as a whole;
(iv) no enquiry or investigation by, or complaint or reference to, any Third
Party having been threatened, announced, implemented, instituted by or against
or remaining outstanding against or in respect of any member of the Wider
Inspired Group which in any case is material in the context of the Wider
Inspired Group taken as a whole;
(v) no claim being made and no circumstance having arisen which might
reasonably be expected to lead to a claim being made under the insurance of any
member of the Wider Inspired Group where such claim would not be covered by such
insurance and where such claim is material in the context of the Wider Inspired
Group taken as a whole; and
(vi) no steps having been taken which are reasonably likely to result in the
withdrawal (without replacement), cancellation or termination of any licence,
permit or consent held by any member of the Wider Inspired Group which is
necessary for the carrying on by such member of its business and which is
material in the context of the Wider Inspired Group;
(g) Bidco not having discovered (other than to the extent Disclosed):
(i) that any financial or business or other information concerning the
Wider Inspired Group disclosed at any time by or on behalf of any member of the
Wider Inspired Group, whether publicly, to any member of the Wider Bidco Group
or otherwise, is materially misleading or contains any material
misrepresentation of fact or omits to state a fact necessary to make any
information contained therein not materially misleading;
(ii) that any member of the Wider Inspired Group is subject to any liability
(actual or contingent) which is material in the context of the Wider Inspired
Group taken as a whole; or
(iii) any information which affects the import of any information disclosed
to Bidco at any time by or on behalf of any member of the Wider Inspired Group
to an extent which is material and adverse in the context of the Wider Inspired
Group taken as a whole;
(h) Save as Disclosed, Bidco not having discovered that:
(i) any past or present member of the Wider Inspired Group has failed to
comply with any applicable legislation, regulations or common law of any
jurisdiction or any notice, order or requirement of any Third Party with regard
to the use, treatment, handling, storage, transport, release, disposal,
discharge, presence, spillage, 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 the
health and safety of any person, or that there has otherwise been any such use,
treatment, handling, storage, transport, release, disposal, discharge, presence,
spillage, leak or emission (whether or not the same constituted non-compliance
by any person with any legislation, regulations or law and wherever the same may
have taken place) which, in any case, would be reasonably likely to give rise to
any liability (whether actual or contingent) or cost on the part of any member
of the Wider Inspired Group which in any case is material in the context of the
Wider Inspired Group taken as a whole;
(ii) there is, or is reasonably likely to be, any obligation or liability,
whether actual or contingent, to make good, repair, reinstate, remedy 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 Inspired Group or any
other property or controlled waters under any environmental legislation,
regulation, common law, notice, circular, order or other lawful requirement of
any relevant authority or Third Party in any jurisdiction or otherwise which in
any case is material in the context of the Wider Inspired Group taken as a
whole; or
(iii) circumstances exist whereby a person or class of persons would be
likely to have a claim against a member of the Wider Inspired Group in respect
of any production used therein now or previously sold or carried out by any past
or present member of the Wider Inspired Group which is or would be material in
the context of the Wider Inspired Group taken as a whole.
For the purpose of these conditions:
(a) "Third Party" means any government, government department or
governmental, quasi-governmental, supranational, statutory, regulatory,
environmental or investigative body or association, institution or agency
(including, without limitation, any trade agency and the UK Gambling Commission)
or authority (including, without limitation, any anti-trust or merger control
authority), any court or professional or environmental body or any other person
or body whatsoever in any relevant jurisdiction;
(b) a Third Party shall be regarded as having "intervened" if it has
taken, instituted, implemented or threatened any action, proceeding, suit,
investigation, enquiry or reference or made, proposed or enacted any statute,
regulation, decision, notice or order or taken any measures or other steps or
required any action to be taken or information to be provided or otherwise
having done anything and "intervene" shall be construed accordingly; and
(c) "Authorisations" means authorisations, orders, grants, recognitions,
determinations, certificates, confirmations, consents, licences, clearances,
provisions, permissions and approvals.
Part B: Waiver of Conditions and further terms of the Acquisition
Subject to the requirements of the Panel, Bidco reserves the right to waive all
or any of the above conditions, in whole or in part, except condition 1. Bidco
shall be under no obligation to waive (if capable of waiver), to determine to be
or remain satisfied or to treat as fulfilled any of conditions 2(a) to (h)
(inclusive) by a date earlier than the date specified in paragraph 1 of Part A
of this Appendix I for the fulfillment thereof.
Bidco reserves the right to elect to implement the Acquisition by way of a
takeover offer (subject to the Panel's consent). In such event, such offer will
be implemented on the same terms and conditions (subject to appropriate
amendments, including (without limitation) an acceptance condition set at ninety
per cent. (or such lower percentage (being more than fifty per cent.) as Bidco
may decide (subject to the Panel's consent)) of the shares to which such offer
relates), so far as applicable, as those which would apply to the Scheme.
If the Panel requires Bidco to make an offer or offers for any Inspired Shares
under the provisions of Rule 9 of the City Code, Bidco may make such alterations
to the conditions of the Acquisition, including to condition 1, as are necessary
to comply with the provisions of that Rule.
The Acquisition will lapse and the Scheme will not proceed (unless the Panel
otherwise consents) if the European Commission initiates proceedings under
Article 6(1)(c) of Council Regulation (EC) 139/2004 or makes a referral to a
competent authority of the United Kingdom under Article 9(3)(b) of that
Regulation or the Acquisition or any matter arising from or relating to the
Acquisition is referred to the Competition Commission before the date of the
Court Meeting(s).
The Acquisition will be on the terms and will be subject, inter alia, to the
conditions which are set out in Part A of this Appendix I and those terms which
will be set out in the formal Scheme Document and related Forms of Proxy and
Forms of Election and such further terms as may be required to comply with the
AIM Rules of the London Stock Exchange and the provisions of the City Code.
Inspired Shares will be acquired pursuant to the Acquisition fully paid and free
from all liens, charges, equitable interests, encumbrances, rights of
pre-emption and any other rights and interests of any nature whatsoever and
together with all rights now and hereafter attaching thereto, 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.
Under Rule 13.4 of the City Code, Bidco may only invoke a condition to the
Acquisition so as to cause the Acquisition 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 Bidco in the context of the
Acquisition. The conditions contained in paragraph 1 of Part A of this Appendix
I and the conditions related to the European Commission and the Competition
Commission in the fourth paragraph of this Part B are not subject to this
provision of the Code.
The Acquisition and the Scheme will be governed by English law and will be
subject to the jurisdiction of the English courts.
The availability of the Acquisition to persons not resident in the United
Kingdom 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.
APPENDIX II
FURTHER DETAILS ON HOLDCO, INTERMEDIATE HOLDCO 1, INTERMEDIATE
HOLDCO 2, THE BIDCO GROUP AND THE HOLDCO GROUP SECURITIES
1 Background information on Holdco, and Intermediate Holdco 1 and
Intermediate Holdco 2
Holdco is a single purpose vehicle incorporated in England and Wales as a
private limited company for the sole purpose of holding certain shares in
Intermediate Holdco 1. Intermediate Holdco 1 is a single purpose vehicle
incorporated in England and Wales as a private limited company as a direct
subsidiary of Holdco for the purposes of holding certain shares in Intermediate
Holdco 2 and receiving certain loans from Vitruvian Luxco and those eligible
Independent Inspired Shareholders who validly elect to receive Holdco
Securities. Intermediate Holdco 2 is a single purpose vehicle incorporated in
England and Wales as a private limited company as a direct subsidiary of
Intermediate Holdco 1 for the sole purpose of holding certain shares in Bidco
and receiving certain loans from Intermediate Holdco 1.
Vitruvian Luxco will have the right to appoint a majority of the directors to
the board of Holdco. As at the date of this announcement Vitruvian Luxco wholly
owns Holdco however, as set out in paragraph 10 of this announcement, the
Executive Managers and the Management Team are expected to invest, in aggregate,
approximately GBP70,400 in Holdco on completion of the Acquisition giving them
an economic entitlement to approximately 10 per cent. of the equity in Holdco
(subject to the ratchet which the Holdco Management Shares benefit from as
described in the paragraph entitled "Ratchet Mechanism" below).
Holdco wholly owns Intermediate Holdco 1, which in turn wholly owns Intermediate
Holdco 2, which in turn wholly owns Bidco. Each of these entities forms part of
the Bidco Group.
2 Capital structure of Holdco
The capital structure of Holdco will comprise the Holdco Shares, being:
· Holdco Ordinary Shares; and
· Holdco Management Shares.
Holdco Ordinary Shares
Holdco Ordinary Shares will rank pari passu with each other with respect to
returns of capital and distributions and will entitle the holders to receive
notice of and attend meetings of members of Holdco. Upon certain circumstances
described in "Holdco Management Shares" below, a number of Holdco Ordinary
Shares will convert into a class of deferred shares with very limited rights and
having no likelihood of any economic value. Further details of this class of
deferred shares will be contained in the Scheme Document.
Each Holdco Ordinary Share will entitle its holder to one vote in any general
meeting of the shareholders of Holdco.
Holdco Ordinary Shares will not be transferrable, except in extremely limited
circumstances or with the consent of Vitruvian Luxco.
Holdco Management Shares
Holdco Management Shares will rank pari passu with each other with respect to
returns of capital and distributions. Holdco Management Shares do not carry the
right to attend or vote at meetings of the members of Holdco. Holdco Management
Shares will also rank pari passu with the Holdco Ordinary Shares with respect to
returns of capital and distributions but will not be subject to the operation of
the ratchet mechanism described immediately below. As mentioned above, the
Executive Managers have agreed to subscribe for Holdco Management Shares and the
Management Team are expected to subscribe for Holdco Management Shares giving
them, in aggregate, an economic entitlement to approximately 10 per cent. of the
equity in Holdco. Further Holdco Management Shares giving an economic
entitlement to 2.5 per cent. of the equity in Holdco are expected to be made
available for employees of the Wider Bidco Group following completion of the
Acquisition.
Ratchet Mechanism
Upon a transfer by Vitruvian Luxco or its nominees of all of its Holdco Ordinary
Shares, a winding up of Holdco or an initial public offering of any member of
the Bidco Group (each such event being an "Exit"), subject to the Hurdle (as
defined below) being achieved, a proportion of the Holdco Ordinary Shares will
be converted into deferred shares having little or no economic value to the
effect that the Holdco Management Shares will be entitled to 22 per cent. of the
economic value of the proceeds received from such Exit to the extent such
proceeds exceed the amount required for Vitruvian Luxco's proceeds to achieve
the Hurdle. This hurdle shall be achieved if, as a result of such Exit,
Vitruvian Luxco has received a return of at least three times the amount
invested by Vitruvian Luxco in the Holdco Group (the "Hurdle").
Any additional proceeds to which the Holdco Management Shares will be entitled
as a result of the operation of this ratchet will dilute the proceeds available
for distribution to the holders of the Holdco Ordinary Shares pro rata.
Under the terms of the financing arrangements entered into by certain members of
the Bidco Group in relation to the Acquisition, the Holdco Shares will not be
eligible for any return of capital or other distribution until all bank debt has
been repaid.
3 Capital Structure of Intermediate Holdco 1
The capital structure of Intermediate Holdco 1 will comprise the following:
· ordinary shares of GBP1.00 each in Intermediate Holdco 1; and
· Intermediate Holdco 1 Loan Notes.
The ordinary shares in Intermediate Holdco 1 will be wholly owned by Holdco.
Intermediate Holdco 1 Loan Notes
The Intermediate Holdco 1 Loan Notes to be issued by Intermediate Holdco 1 upon
completion of the Acquisition will confer upon the holders the right to receive
interest at a rate of 13.5 per cent. per annum, compounding annually. Accrued
interest may, at the option of Intermediate Holdco 1, be satisfied by
Intermediate Holdco 1 issuing to holders further Intermediate Holdco 1 Loan
Notes.
The Intermediate Holdco 1 Loan Notes will be repayable on the earlier of a Exit
(as defined in paragraph 2 "Ratchet Mechanism" above) or eight years from the
date of issuance provided, in each case, that certain bank debt has been fully
repaid. Intermediate Holdco 1 may also, at its election, redeem any or all of
the Intermediate Holdco 1 Loan Notes upon notice to the relevant holders of such
Intermediate Holdco 1 Loan Notes.
Intermediate Holdco 1 Loan Notes will only be transferrable in extremely limited
circumstances save with the consent of Vitruvian Luxco.
Under the terms of the financing arrangements entered into by certain members of
the Bidco Group in relation to the Acquisition, the Intermediate Holdco 1 Loan
Notes will not be eligible for any payment of interest or principal until all
bank debt has been repaid. Further, the Intermediate Holdco 1 Loan Notes are
unsecured securities.
4 Representation of Electing Inspired Shareholders
The Electing Inspired Shareholders will be entitled to be represented by a
director on the board of Holdco, such person to be nominated by the board of
directors of Holdco and then approved by a representative appointed by a
majority of the Electing Inspired Shareholders among themselves. This right
would cease to apply if and when the value of the Holdco Shares held by Electing
Inspired Shareholders falls below 10 per cent of the total equity share capital
in Holdco.
In addition, any Electing Inspired Shareholder who holds five per cent or more
of the equity share capital of Holdco will be entitled to receive certain board
level information and monthly management accounting information relating to the
Holdco Group.
5 Further terms in relation to the Holdco Group Securities Alternative
The rights and obligations of Electing Inspired Shareholders in respect of
Holdco Group Securities will be governed by the Articles of Association of
Holdco, the terms of the Loan Note Instrument to be made by Intermediate Holdco
1 and by the Investment Agreement. Electing Inspired Shareholders will be
required to grant a power of attorney in the Forms of Election entitling such
attorney to enter into a deed of adherence to the Investment Agreement on behalf
of such Electing Inspired Shareholder. Upon entry into such deed of adherence,
the Investment Agreement will become binding on those eligible Independent
Inspired Shareholders who validly elect for the Holdco Group Securities
Alternative. Further details of these documents will be set out in the Scheme
Document.
APPENDIX III
HOLDCO GROUP SECURITIES RISK FACTORS
1 The Holdco Group Securities will not be listed on any stock exchange,
nor is it the current intention to offer any trading facility for Holdco Group
Securities.
2 Holdco will be controlled by Vitruvian Luxco who will have the right
to appoint a majority of the directors to the board of Holdco.
3 Save with the consent of Vitruvian Luxco, Holdco Group Securities will
not be transferable except in extremely limited circumstances.
4 The holders of Holdco Group Securities will not enjoy any minority
protections or other rights save for those rights reflected in Appendix II to
this announcement or as described in the Scheme Document and for those rights
prescribed by applicable law.
5 Upon the Scheme becoming effective, the Bidco Group will be controlled
by funds managed or advised by Vitruvian.
6 The Bidco Group is expected to have total senior secured debt drawn of
approximately GBP50 million, together with additional arranged facilities of
GBP20 million, all of which are expected to rank in priority to the Holdco Group
Securities.
7 For so long as the Bidco Group has outstanding secured debt, Holdco
will not be entitled to declare or pay any distribution to any of its
shareholders.
8 The Holdco Group Securities are unsecured securities and will not be
eligible for any return of capital, distribution or payment of interest or
principal until all bank debt has been repaid.
9 The value of the Holdco Group Securities will be subject to the same
market and trading risks as are faced by Inspired currently, including the risk
in the trading performance of Inspired.
10 Shareholders in Holdco may be required in the future to sell their
Holdco Ordinary Shares under the terms of a "drag along" provision in the
Investment Agreement and/or Articles of Association of Holdco.
11 Holders of Holdco Group Securities will not be afforded the same level
of protections and disclosure of information that they currently benefit from as
shareholders in Inspired as a listed company.
APPENDIX IV
SOURCES OF INFORMATION AND BASES OF CALCULATION
The value of Inspired as implied by the Acquisition price stated in paragraph 2
of this announcement is based on the issued share capital as per Inspired's
latest filings, being total issued share capital of 124,081,373 ordinary shares
as announced by Inspired pursuant to Rule 2.10 of the Code on 26 April 2010.
The combined value of the then issued Old Ordinary Shares and Convertible
Preference Shares at close of business on 27 July 2009 as stated in the summary
and paragraphs 2 and 4 of this announcement is based on the then issued share
capital of Inspired of:
· 73,879,943 Old Ordinary Shares which had a middle market price at the
close of business on that date, as derived from the AIM Appendix of the Daily
Official List of the London Stock Exchange for that day, of 2.95 pence per
share; and
· 95,742,826 Convertible Preference Shares which had a middle market price
at the close of business on that date, as derived from the AIM Appendix of the
Daily Official List of the London Stock Exchange for that day, of 32.50 pence
per share.
APPENDIX V
DETAILS OF IRREVOCABLE UNDERTAKINGS AND LETTERS OF INTENT
PART A
The Executive Managers who are Inspired Shareholders and certain members of the
Management Team (and a related trust) have given irrevocable undertakings to
vote, and in relation to any Inspired Shares held in trust, to procure that the
trustees vote, in favour of the Resolutions (excluding the Ordinary Resolution)
in respect of the number of Inspired Shares set out below:
+--------------------------+--------------------+------------------+
| Name | Number of Inspired | % of issued |
| | Shares | Inspired Shares |
+--------------------------+--------------------+------------------+
| Luke Alvarez | 259,244 | 0.21% |
+--------------------------+--------------------+------------------+
| Steven Holmes | 19,580 | 0.02% |
+--------------------------+--------------------+------------------+
| James O'Halleran | 35,516 | 0.03% |
+--------------------------+--------------------+------------------+
| Steven Rogers (held in | 1,281,516 | 1.03% |
| the name of Steven | | |
| Rogers Discretionary | | |
| Settlement Trust) | | |
+--------------------------+--------------------+------------------+
| TOTAL | 1,595,856 | 1.29% |
+--------------------------+--------------------+------------------+
The undertakings in this Part A will remain binding in all circumstances other
than if any Independent Inconsistent Transaction becomes or is declared wholly
unconditional.
PART B
Russell Hoyle has given an irrevocable undertaking to vote in favour of the
Resolutions in respect of a total of 594,663 Inspired Shares, representing
approximately 0.48 per cent. of the existing issued share capital of Inspired.
The undertaking in this Part B will remain binding in all circumstances other
than if any Independent Inconsistent Transaction becomes or is declared wholly
unconditional.
PART C
The following holders or controllers of Independent Inspired Shares have given
irrevocable undertakings to vote in favour of the Acquisition and the
Resolutions:
+--------------------------+--------------------+------------------+
| Name | Number of Inspired | % of issued |
| | Shares | Inspired Shares |
+--------------------------+--------------------+------------------+
| (a) David Mace | 18,750 | 0.02% |
+--------------------------+--------------------+------------------+
| (b) Peter Metelko | 1,656,721 | 1.34% |
+--------------------------+--------------------+------------------+
| (c) CHB Mills, LT | 12,763 | 0.01% |
| Mills and D Nation | | |
| (Deceased) Children's | | |
| Trust | | |
+--------------------------+--------------------+------------------+
| (d) Christopher Mills | 596,621 | 0.48% |
+--------------------------+--------------------+------------------+
| (e) Eveswise | 16,666 | 0.01% |
| Retirement Fund | | |
+--------------------------+--------------------+------------------+
| (f) Lynne Mills | 6,666 | 0.01% |
+--------------------------+--------------------+------------------+
| (g) Julian Paul | 3,472 | Less than 0.01% |
+--------------------------+--------------------+------------------+
| (h) Belgravia Homes | 1,166,666 | 0.94% |
| Limited | | |
+--------------------------+--------------------+------------------+
| (i) Melvin Lawson | 2,237,334 | 1.80% |
+--------------------------+--------------------+------------------+
| (j) North Atlantic | 23,054,023 | 18.58% |
| Value LLP | | |
+--------------------------+--------------------+------------------+
| (k) Artemis | 7,107,780 | 5.73% |
| Investment Management | | |
| Limited | | |
+--------------------------+--------------------+------------------+
| (l) Gartmore | 10,931,723 | 8.81% |
| Investment Limited | | |
+--------------------------+--------------------+------------------+
| (m) Guinness Peat | 7,962,467 | 6.42% |
| Group plc | | |
+--------------------------+--------------------+------------------+
| (n) Stodir HF | 5,280,237 | 4.26% |
+--------------------------+--------------------+------------------+
| TOTAL | 60,051,889 | 48.40% |
+--------------------------+--------------------+------------------+
The undertakings listed in (a) to (j) of this Part C will remain binding in all
circumstances other than if any Independent Inconsistent Transaction becomes or
is declared wholly unconditional.
The undertakings listed in (k) to (n) of this Part C will remain binding in all
circumstances other than if either (i) any Independent Inconsistent Transaction
is announced pursuant to Rule 2.5 of the Code at a price that is 15 per cent.
greater than the Acquisition price; or (ii) any Independent Inconsistent
Transaction becomes or is declared wholly unconditional.
PART D
The following holders or controllers of Independent Inspired Shares have
executed letters of intent to vote in favour of the Acquisition and the
Resolutions:
+--------------------------+--------------------+------------------+
| Name | Number of Inspired | % of issued |
| | Shares | Inspired Shares |
+--------------------------+--------------------+------------------+
| Jupiter Asset Management | 2,549,646 | 2.05% |
| Limited | | |
+--------------------------+--------------------+------------------+
| Universities | 2,983,111 | 2.40% |
| Superannuation Scheme | | |
| Limited | | |
+--------------------------+--------------------+------------------+
| Invesco Asset Management | 1,740,146 | 1.40% |
| Limited | | |
+--------------------------+--------------------+------------------+
| TOTAL | 7,272,903 | 5.86% |
+--------------------------+--------------------+------------------+
APPENDIX VI
DEFINITIONS
The following definitions apply throughout this announcement unless the context
requires otherwise.
+-------------------------+---------------------------------------+
| "2006 Act" or | the Companies Act 2006, as amended; |
| "Companies Act 2006" | |
+-------------------------+---------------------------------------+
| "Acquisition" | the proposed acquisition of Inspired |
| | by Bidco by means of the Scheme (or |
| | should Bidco so elect, by means of |
| | the Offer) on |
| | the terms and subject to the |
| | conditions and |
| | further terms set out in this |
| | announcement and to be set |
| | out in the Scheme Document (or the |
| | Offer Document (as the case may be)) |
| | and where the context admits, any |
| | subsequent revision, variation, |
| | extension or renewal thereof and |
| | together with all other related |
| | matters to be considered at the Court |
| | Meeting and General Meeting; |
+-------------------------+---------------------------------------+
| "AIM" | the AIM market operated by the London |
| | Stock Exchange; |
+-------------------------+---------------------------------------+
| "AIM Rules for | the AIM Rules for Companies published |
| Companies" | from time to time by the London Stock |
| | Exchange; |
+-------------------------+---------------------------------------+
| "Altium" | Altium Capital Limited, financial |
| | adviser to Bidco and Vitruvian; |
+-------------------------+---------------------------------------+
| "Annual Report" | the annual report and accounts of |
| | Inspired for the year ended 26 |
| | September 2009; |
+-------------------------+---------------------------------------+
| "Bidco" | Gaming Acquisitions Limited, a |
| | company incorporated in England and |
| | Wales under number 7120910; |
+-------------------------+---------------------------------------+
| "Bidco Directors" | the directors of Bidco as at the date |
| | of this announcement; |
+-------------------------+---------------------------------------+
| "Bidco Group" | Bidco and its direct and indirect |
| | holding companies (excluding, for the |
| | avoidance of doubt, Vitruvian and the |
| | Vitruvian Fund); |
+-------------------------+---------------------------------------+
| "Business Day" | a day (other than Saturdays, Sundays |
| | and UK public holidays) on which |
| | banks are open for business in |
| | London; |
+-------------------------+---------------------------------------+
| "Capital Reduction" | the reduction of Inspired's share |
| | capital provided for by the Scheme; |
+-------------------------+---------------------------------------+
| "City Code" or "Code" | the City Code on Takeovers and |
| | Mergers; |
+-------------------------+---------------------------------------+
| "Closing Price" | the middle market price of an |
| | Inspired Share at the close of |
| | business on the day to which such |
| | price relates, as derived from the |
| | AIM Appendix of the Daily Official |
| | List of the London Stock Exchange for |
| | that day; |
+-------------------------+---------------------------------------+
| "Conditions" | the conditions to the implementation |
| | of the Scheme and the Acquisition |
| | which are set out in Appendix I to |
| | this announcement; |
+-------------------------+---------------------------------------+
| "Convertible | the issued and fully paid convertible |
| Preference Shares" | preference shares of 1 pence each in |
| | the capital of Inspired prior to the |
| | share capital reorganisation |
| | completed on 27 November 2009; |
+-------------------------+---------------------------------------+
| "Court" | the High Court of Justice in England |
| | and Wales; |
+-------------------------+---------------------------------------+
| "Court Meeting" | the meeting of Scheme Shareholders |
| | (and any adjournment thereof) and/or |
| | of classes thereof to be convened |
| | pursuant to an order of the Court |
| | under Part 26 of the 2006 Act for the |
| | purposes of considering and, if |
| | thought fit, approving the Scheme |
| | (with or without amendment); |
+-------------------------+---------------------------------------+
| "CREST" | a relevant system (as defined in the |
| | Regulations) in respect of which |
| | Euroclear is the Operator (as defined |
| | in the Regulations); |
+-------------------------+---------------------------------------+
| "Disclosed" | disclosed in (i) the Annual Report; |
| | (ii) any documents delivered to any |
| | director, officer or employee of |
| | Bidco or any of Bidco's professional |
| | advisers engaged in connection with |
| | the Acquisition on or before 5.00pm |
| | on 30 April 2010 (including, but not |
| | limited to, in minutes of any |
| | disclosure meetings that are so |
| | delivered); or (iii) any public |
| | announcement by Inspired to a |
| | Regulatory Information Service on or |
| | before 5.00pm on 30 April 2010; |
+-------------------------+---------------------------------------+
| "Electing Inspired | those eligible Independent Inspired |
| Shareholders" | Shareholders validly electing to |
| | receive the Holdco Group Securities |
| | Alternative; |
+-------------------------+---------------------------------------+
| "Evolution Securities" | Evolution Securities Limited, |
| | independent financial adviser to |
| | Inspired for the purposes of Rule 3 |
| | of the Code; |
+-------------------------+---------------------------------------+
| "Executive Managers" | members of the management of Inspired |
| | who have reached agreement with Bidco |
| | in relation to the Management |
| | Arrangements, namely, Luke Alvarez, |
| | David Wilson and James O'Halleran; |
+-------------------------+---------------------------------------+
| "Forms of Election" | the forms of election for use by |
| | Independent Inspired Shareholders |
| | electing for the Holdco Group |
| | Securities Alternative; |
+-------------------------+---------------------------------------+
| "Forms of Proxy" | the forms of proxy for use at the |
| | Court Meeting and the General |
| | Meeting; |
+-------------------------+---------------------------------------+
| "FSA" or "Financial | the Financial Services Authority in |
| Services Authority" | its capacity as the competent |
| | authority for the purposes of Part VI |
| | of the FSMA; |
+-------------------------+---------------------------------------+
| "FSMA" or "Financial | the Financial Services and Markets |
| Services and Markets | Act 2000; |
| Act" | |
+-------------------------+---------------------------------------+
| "General Meeting" | the general meeting of Inspired |
| | Shareholders (and any adjournment |
| | thereof) to be convened in connection |
| | with the Acquisition; |
+-------------------------+---------------------------------------+
| "Holdco" | DMWSL 633 Limited, a company |
| | incorporated in England and Wales |
| | under registered number 7176544; |
+-------------------------+---------------------------------------+
| "Holdco Group" | Holdco and its subsidiary and |
| | associated undertakings from time to |
| | time; |
+-------------------------+---------------------------------------+
| "Holdco Group | the Holdco Ordinary Shares and |
| Securities" | Intermediate Holdco 1 Loan Notes |
| | which shall be issued in a fixed |
| | proportion to each other; |
+-------------------------+---------------------------------------+
| "Holdco Group | the alternative whereby eligible |
| Securities Alternative" | Independent Inspired Shareholders |
| | (other than certain overseas |
| | Shareholders) may elect to receive |
| | Holdco Group Securities instead of |
| | all or part of the cash consideration |
| | to which they would otherwise be |
| | entitled under the terms of the |
| | Acquisition, in accordance with the |
| | terms and conditions set out in this |
| | announcement and the Scheme Document; |
+-------------------------+---------------------------------------+
| "Holdco Management | the B ordinary shares of GBP0.01 each |
| Shares" | in the capital of Holdco; |
+-------------------------+---------------------------------------+
| "Holdco Ordinary | the A ordinary shares of GBP0.01 each |
| Shares" | in the capital of Holdco; |
+-------------------------+---------------------------------------+
| "Holdco Shares" | the Holdco Ordinary Shares and the |
| | Holdco Management Shares; |
+-------------------------+---------------------------------------+
| "Independent | the committee of directors of |
| Directors" | Inspired who are independent in |
| | relation to the Acquisition, |
| | comprising Julian Paul, Christopher |
| | Mills and David Mace; |
+-------------------------+---------------------------------------+
| "Independent Inspired | Scheme Shareholders other than the |
| Shareholders" | Executive Managers, the Management |
| | Team, the Steven Rogers Discretionary |
| | Settlement Trust and Russell Hoyle; |
+-------------------------+---------------------------------------+
| "Independent Inspired | Inspired Shares held by Independent |
| Shares" | Inspired Shareholders; |
+-------------------------+---------------------------------------+
| "Independent | either: |
| Inconsistent | |
| Transaction" | (a) an offer, scheme, of |
| | arrangement, recapitalisation or |
| | other transaction which involves a |
| | change of control (as defined in the |
| | City Code) of Inspired or any other |
| | member of the Inspired Group; or |
| | |
| | (b) any arrangement or |
| | transaction which involves or |
| | contemplates the transfer of any |
| | interest in the whole, or |
| | substantially the whole of the |
| | undertaking, assets and/or business |
| | of Inspired or any other member of |
| | the Inspired Group; or |
| | |
| | (c) any other arrangement or |
| | transaction or series of the same |
| | which is inconsistent with or an |
| | alternative to the Acquisition, |
| | |
| | which is in each case to be made or |
| | entered into by or with a third party |
| | which is not acting in concert (as |
| | defined in the City Code) with Bidco; |
+-------------------------+---------------------------------------+
| "Inspired" or the | Inspired Gaming Group plc; |
| "Company" | |
+-------------------------+---------------------------------------+
| "Inspired 2006 Share | the Inspired 2006 Share Option Plan; |
| Option Plan" | |
+-------------------------+---------------------------------------+
| "Inspired Articles" | the articles of association of |
| | Inspired as amended from time to |
| | time; |
+-------------------------+---------------------------------------+
| "Inspired Board" | the board of directors of Inspired as |
| | at the date of this announcement; |
+-------------------------+---------------------------------------+
| "Inspired Group" | Inspired and its subsidiary and |
| | associated undertakings and, where |
| | the context permits, each of them; |
+-------------------------+---------------------------------------+
| "Inspired Savings | the Inspired Savings Related Share |
| Related Share Option | Option Scheme; |
| Scheme" | |
+-------------------------+---------------------------------------+
| "Inspired | the holders of Inspired Shares; |
| Shareholders" or | |
| "Shareholders" | |
+-------------------------+---------------------------------------+
| "Inspired Shares" | the existing unconditionally allotted |
| | or issued and fully paid ordinary |
| | shares of 0.6 pence each in the |
| | capital of Inspired and any further |
| | such ordinary shares which are |
| | unconditionally allotted or issued |
| | before the Scheme becomes effective; |
+-------------------------+---------------------------------------+
| "Inspired Share | the Inspired 2006 Share Option Plan |
| Schemes" | and the Inspired Savings Related |
| | Share Option Scheme; |
+-------------------------+---------------------------------------+
| "Intermediate Holdco | DMWSL 632 Limited, a company |
| 1" | incorporated in England and Wales |
| | under registered number 7176582; |
+-------------------------+---------------------------------------+
| "Intermediate Holdco 1 | the loan notes to be constituted |
| Loan Notes" | pursuant to the Loan Note Instrument; |
+-------------------------+---------------------------------------+
| "Intermediate Holdco | DMWSL 631 Limited, a company |
| 2" | incorporated in England and Wales |
| | under registered number 7176707; |
+-------------------------+---------------------------------------+
| "Investment Agreement" | the shareholders agreement dated 30 |
| | April 2010 and entered into between |
| | Bidco, Holdco, Vitruvian Luxco, the |
| | Executive Managers and others; |
+-------------------------+---------------------------------------+
| "Loan Note Instrument" | the loan note instrument made by |
| | Intermediate Holdco 1 to be entered |
| | into on or shortly following the |
| | Scheme Effective Date; |
+-------------------------+---------------------------------------+
| "London Stock | London Stock Exchange plc, a public |
| Exchange" | company incorporated in England and |
| | Wales under number 2075721; |
+-------------------------+---------------------------------------+
| "Management | the arrangements with the Executive |
| Arrangements" | Managers and the Management Team, as |
| | described in this announcement and as |
| | to be set out in more detail in the |
| | Scheme Document; |
+-------------------------+---------------------------------------+
| "Management Team" | members of the management of Inspired |
| | who, it is anticipated, will be |
| | participating in the Management |
| | Arrangements, namely Martin Lucas, |
| | Lee Gregory, Steven Rogers, Matt |
| | Ingram, Steven Holmes, Rod Hyde and |
| | Alistair Hopkins; |
+-------------------------+---------------------------------------+
| "Offer" | should Bidco elect (with the consent |
| | of the Panel) to make the Acquisition |
| | by way of an offer, the recommended |
| | cash offer to be made by Bidco to |
| | acquire all of the issued or to be |
| | issued Inspired Shares not already |
| | owned (or contracted to be acquired) |
| | by Bidco or its associates (including |
| | where the context so requires, any |
| | subsequent revision, variation, |
| | extension or renewal of such offer); |
+-------------------------+---------------------------------------+
| "Offer Document" | should Bidco elect (with the consent |
| | of the Panel) to make the Acquisition |
| | by way of an offer, the document |
| | containing, amongst other things, the |
| | details of the offer, the terms and |
| | conditions of the offer and certain |
| | information about Inspired and Bidco |
| | to be sent to Inspired Shareholders |
| | and others; |
+-------------------------+---------------------------------------+
| "Offer Period" | the period commencing on 28 July 2009 |
| | and ending on the Scheme Effective |
| | Date; |
+-------------------------+---------------------------------------+
| "Official List" | the Official List of the UK Listing |
| | Authority; |
+-------------------------+---------------------------------------+
| "Old Ordinary Shares" | the issued and fully paid ordinary |
| | shares of 1 pence each in the capital |
| | of Inspired prior to the share |
| | capital reorganisation completed on |
| | 27 November 2009; |
+-------------------------+---------------------------------------+
| "Ordinary Resolution" | the ordinary resolution to be |
| | proposed at the General Meeting in |
| | accordance with the requirements of |
| | the Code to approve the Management |
| | Arrangements; |
+-------------------------+---------------------------------------+
| "Panel" | the Panel on Takeovers and Mergers; |
+-------------------------+---------------------------------------+
| "Reduction Court | the order of the Court confirming the |
| Order" | reduction of share capital under |
| | Section 648 of the 2006 Act provided |
| | for by the Scheme; |
+-------------------------+---------------------------------------+
| "Registrar of | the Registrar of Companies in England |
| Companies" | and Wales; |
+-------------------------+---------------------------------------+
| "Regulations" | the Uncertificated Securities |
| | Regulations 2001 (SI2001 No. 3755), |
| | as amended from time to time; |
+-------------------------+---------------------------------------+
| "Regulatory | any of the services set out in |
| Information Service" | Appendix III to the Listing Rules; |
+-------------------------+---------------------------------------+
| "Resolutions" | the resolutions to be proposed at the |
| | General Meeting; |
+-------------------------+---------------------------------------+
| "Restricted | any jurisdiction in relation to which |
| Jurisdiction" | the extension or acceptance of the |
| | Holdco Group Securities Alternative |
| | would violate the law of that |
| | jurisdiction or which Bidco decides, |
| | in its sole discretion, would be |
| | likely to involve disproportionate |
| | complexity, cost or risk, subject to |
| | the requirements of Rule 30.3 of the |
| | Code; |
+-------------------------+---------------------------------------+
| "Scheme" | the proposed scheme of arrangement |
| | under Part 26 of the 2006 Act, the |
| | full terms of which will be set out |
| | in the Scheme Document with or |
| | subject to any modification, addition |
| | or condition which Bidco may agree, |
| | and if required, the Court may |
| | approve or impose; |
+-------------------------+---------------------------------------+
| "Scheme Document" | the document to be sent to the |
| | Inspired Shareholders, containing and |
| | setting out the Scheme and the |
| | notices convening the Court Meeting |
| | and the General Meeting; |
+-------------------------+---------------------------------------+
| "Scheme Effective | the date on which the Scheme becomes |
| Date" | effective in accordance with its |
| | terms; |
+-------------------------+---------------------------------------+
| "Scheme Record Time" | 6.00 p.m. on the Business Day |
| | immediately preceding the date on |
| | which the Court sanctions the Scheme |
| | and confirms the Reduction Court |
| | Order; |
+-------------------------+---------------------------------------+
| "Scheme Shareholders" | holders of Scheme Shares from time to |
| | time; |
+-------------------------+---------------------------------------+
| "Scheme Shares" | the Inspired Shares: |
| | (i) in issue at the date of |
| | the Scheme Document; |
| | (ii) (if any) issued after the |
| | date of the Scheme Document and |
| | before the Voting Record Time; and |
| | (iii) (if any) issued at or |
| | after the Voting Record Time and |
| | prior to the Scheme Record time, on |
| | terms that the holder shall be bound |
| | by the Scheme or, in the case of any |
| | subsequent holders of any such shares |
| | issued prior to the adoption of the |
| | amendment to the Inspired Articles to |
| | be adopted at the General Meeting, in |
| | respect of which the holder shall |
| | have agreed in writing to be bound by |
| | this Scheme, |
| | in each case excluding any Inspired |
| | Shares legally or beneficially owned |
| | by members of the Bidco Group; |
+-------------------------+---------------------------------------+
| "United Kingdom" or | the United Kingdom of Great Britain |
| "UK" | and Northern Ireland |
+-------------------------+---------------------------------------+
| "United States" or | the United States of America, its |
| "US" | territories and possessions, any |
| | State of the United States of America |
| | and the District of Columbia; |
+-------------------------+---------------------------------------+
| "Vitruvian" | Vitruvian Partners LLP, a limited |
| | liability partnership registered in |
| | England and Wales under number |
| | OC319894; |
+-------------------------+---------------------------------------+
| "Vitruvian Fund" | the Vitruvian Investment Partnership |
| | I Fund, comprising investment |
| | partnerships advised by Vitruvian; |
+-------------------------+---------------------------------------+
| "Vitruvian Luxco" | Sippadmin Lux Sarl, a company |
| | incorporated in Luxembourg having its |
| | registered office at 174, route de |
| | Longwy, L-1940, Luxembourg, being an |
| | indirect holding company of Bidco; |
+-------------------------+---------------------------------------+
| "Voting Record Time" | the time to be set out in the Scheme |
| | Document; |
+-------------------------+---------------------------------------+
| "Wider Bidco Group" | Bidco, its subsidiary undertakings, |
| | associated undertakings and any other |
| | undertakings in which that company |
| | and such undertakings (aggregating |
| | their interests) have a substantial |
| | interest; and |
+-------------------------+---------------------------------------+
| "Wider Inspired Group" | Inspired, its subsidiary |
| | undertakings, associated undertakings |
| | and any other undertakings in which |
| | that company and such undertakings |
| | (aggregating their interests) have a |
| | substantial interest. |
+-------------------------+---------------------------------------+
For the purposes of this announcement, "subsidiary", "subsidiary undertaking",
"undertaking" and "associated undertaking" have the respective meanings given
thereto by the 2006 Act, but for this purpose ignoring paragraph 20(1)(b) of
Schedule 4A of the Companies Act 1985.
All the times referred to in this announcement are London times unless otherwise
stated.
References to the singular include the plural and vice versa.
GBP and pence means pounds and pence sterling, the lawful currency of the United
Kingdom.
EUR means euro, the lawful currency of the member states of the European Union
that adopt the single currency in accordance with the EC Treaty.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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