Acquisition and Placing Announcement
Thursday 24 May 2007
NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, DIRECTLY OR INDIRECTLY, IN OR INTO THE UNITED STATES, AUSTRALIA, CANADA OR JAPAN. THIS RELEASE IS NOT AN OFFER OF SECURITIES FOR SALE INTO THE UNITED STATES, AUSTRALIA, CANADA OR JAPAN.
Introduction
SIG plc (“SIG”), the leading international specialist supplier in insulation, roofing, interiors and specialist construction and safety products, is pleased to announce that it has agreed to acquire the entire issued share capital of Larivière SAS (“Larivière”), the largest specialist distributor of roofing products in France, for €296.6 million (approximately £202 million) from AXA Private Equity (“AXA”). Completion is conditional upon formal approval by the competition authorities in France. In addition, SIG is today announcing an increase in its planned acquisition activity. Total spend on acquisitions was £110m in 2005 and £109m in 2006. In 2007, excluding Larivière, acquisition spend is expected to be significantly higher and may be up to £200m. Thereafter, it is expected that the level of acquisition spend will be over £100m per annum and may be up to £200m in some future years. The phasing of this spend cannot be predicted with any great accuracy and the above figures should not be taken to be a forecast of future acquisition spend. Further to the acquisition of Larivière, and SIG’s increase in acquisition activity, the Company also announces the placing of new ordinary shares with institutional and other investors, to raise gross proceeds of up to £150 million (the “Placing”). The Placing will not exceed 9.9 per cent. Of SIG’s current issued share capital. The Placing is intended to fund the acquisition of Larivière and the increase in acquisition spend, to maintain financial flexibility to allow SIG to move quickly and to take advantage of other acquisition opportunities as they are identified, and to ensure that SIG continues to drive its organic growth through ongoing investment in its businesses. The Placing has been fully underwritten by Panmure Gordon, subject to certain terms and conditions set out in a placing agreement between Panmure Gordon and SIG. Lazard & Co., Limited acted as financial adviser to SIG in relation to the acquisition of Larivière.
Highlights
• SIG considers the acquisition to be an attractive opportunity to acquire the largest specialist distributor of roofing products in France. • SIG expects sales and EBITDA of Larivière for the year ending 30 June 2007 to be c.€340m and c.€23m respectively. • Larivière is an excellent strategic fit with SIG’s existing operations. In France, where SIG has a proven track record of profitable growth and expansion, the acquisition of Larivière will more than double SIG’s sales. • In the roofing market, again where SIG has a proven track record of profitable growth and expansion in the UK, Ireland and, more recently, in Germany and Poland, the acquisition of Larivière makes SIG the largest specialist supplier of roofing products in Europe. • Larivière presently operates from 83 trading sites in France, and SIG plans to expand the trading site network significantly to increase market share and expand the customer base. • The Acquisition provides SIG with exciting growth opportunities for the expansion of Larivière’s product range and also gives it the opportunity to benefit from purchasing synergies with its existing operations in the UK, Ireland, Germany and Poland. • SIG expects the acquisition to be immediately earnings enhancing. • The Company is also raising up to £150 million by way of a placing of new ordinary shares of up to 9.9 per cent. Of the Company’s current issued share capital, to fund the acquisition of Larivière, to give it financial flexibility to fund its pipeline of ongoing acquisition opportunities and organic growth. • Subject to regulatory approval, completion is expected in June 2007.
David Williams, Chief Executive of SIG, commented:
"This is a great deal for Larivière and SIG. The combination of our existing expertise in the roofing industry and that of the number one specialist supplier in France means that we can provide our backing and support to the expansion and growth plans already well developed by the very impressive Larivière management team.”
For further information, please contact:
SIG: 0114 285 6300
David Williams, Chief Executive
Gareth Davies, Finance Director
Finsbury: 020 7251 3801
Faeth Birch
Gordon Simpson
Clare Strange
Lazard:
Alexandra Soto +33 1 44 13 01 11
David Reitman 020 7187 2000
Vasco Litchfield 020 7187 2000
Panmure Gordon:
Hugh Morgan (Corporate Finance) 020 7459 3600
Gilbert Ellacombe (Syndication) 020 7614 8315
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