Release Date: 12 October 2007
Release ID: 1360
Norbert Dentressangle Group and the Directors of Christian Salvesen are pleased to announce today that they have reached agreement on the terms of a recommended acquisition by way of Scheme of Arrangement by Norbert Dentressangle Group of the entire issued and to be issued ordinary share capital of Christian Salvesen at a price of 92 pence in cash for each Christian Salvesen Share, valuing Christian Salvesen's fully diluted share capital at approximately £254.4 million (€365.1 million)1.
The terms of the transaction represent a premium of 78.6% to the closing price of 51.5 pence for each Christian Salvesen share on 24 September 2007, being the last business day prior to the announcement by Christian Salvesen that it had received approaches from potential offerors, and a premium of 58.0% to the average closing price of 58.2 for each Christian Salvesen share for the three-month period prior to 24 September 2007.
The consideration payable under the transaction will be financed through existing cash resources and senior credit facilities being made available by Société Générale of €225 million.
Norbert Dentressangle Group, or its advisers, have received irrevocable undertakings to vote in favour of the transaction at the Court Meeting and the General Meeting from the Christian Salvesen Directors, members of the Salvesen family and other shareholders (representing approximately 23 per cent. of the entire existing issued share capital of Christian Salvesen).
Norbert Dentressangle Group believes that this strategic transaction will enable the enlarged group to offer significant operational benefits and will facilitate growth of the business within Europe. It will result in the creation of a European transport and logistics leader, with c. €2.9 billion euros of combined turnover in 20062 and 29,200 employees.
Norbert Dentressangle Group will reinforce its position in 13 European countries, with a significant enlargement of its activities in the United Kingdom and a reinforcement of its presence in the Benelux, Spain and Portugal. In addition, with the addition of Christian Salvesen, the new combined group will become a significant player in each of its business lines, and particularly in Distribution and Refrigerated and Frozen Logistics.
Christian Salvesen is a major European logistics and transportation business operating in the UK, France, Benelux, Ireland, Portugal and Spain, and employs 14,000 people across approximately 200 sites. Christian Salvesen has a portfolio of high profile customers across a number of sectors of the market including automotive, aviation logistics, building products, clothing and fashion, non-food retail, food & food processing, retail support and manufactured products. Christian Salvesen reported revenue for the year ended 31 March 2007 of £899 million (€1.3 billion)3.
Norbert Dentressangle Group believes the combination of Christian Salvesen and Norbert Dentressangle Group will create a leading European player, and that the two companies’ businesses are highly complementary, both in terms of activity and geographical presence:
A leading European player:
- With the acquisition of Christian Salvesen, the enlarged group will enter into the top echelon of European logistics and transport providers, with combined sales achieved in 2006 of c. €2.9 billion2 and 390 sites in 13 countries;
- Creation of a pan-European leading road transport provider, with combined revenues of €1.6 billion in 20062, and Europe’s largest tractor and trailer fleet operator, with 8,000 tractors and 10,200 trailers; and
- Entry of the group among the major European providers of logistics services, with combined revenues of €1.3 billion in 20062 and c. 4 million square meters of operated warehouse space.
Two complementary businesses:
- Norbert Dentressangle Group believes the local networks of Christian Salvesen in key countries including the UK, France and Spain, will expand Norbert Dentressangle Group’s overall offering and strengthen Norbert Dentressangle Group’s service offering through the contribution of a new activity for the group in distribution, and the strong presence of Christian Salvesen in food and refrigerated products will continue to strengthen Norbert Dentressangle Group’s current market position and service potential to clients; and
- Christian Salvesen’s strong presence in the UK, Benelux and the Iberian Peninsula offers a strategic point of entry for Norbert Dentressangle Group’s current products and services, and Norbert Dentressangle Group’s established positions in France, Italy and several Eastern countries will, when linked with Christian Salvesen’s geographic presence, create a leading European network.
1 Applied exchange rate as of 28 September 2007 of 0.6968 pound sterling per euro.
2 For the calendar year 2006, with an applied exchange rate of 0.6818 pound sterling per euro.
3 For the year beginning 1 April 2006 and ending 31 March 2007, with an applied exchange rate of 0.67791 pound sterling per euro.
Furthermore, Norbert Dentressangle Group believes a critical size is required to offer clients a complete range of tailor-made transport and logistics solutions within Europe and that this Transaction will contribute significantly to Norbert Dentressangle Group’s prospects within this market.
Norbert Dentressangle Group believes that its experience in acquiring and integrating companies, along with the two group’s complementary cultures, will assist the integration and continued growth of the new combined group, which will utilise best practices in each group. In addition, Norbert Dentressangle Group expects the Transaction to deliver significant annual synergies of around €25 million before interest and taxes by 2010, driven by cost savings on purchases, back office costs and information systems, and that the transaction will be earnings accretive starting in the first year (before exceptional items such as one-off costs relating to synergies).
Jean-Claude Michel, CEO of Norbert Dentressangle Group, commented: “I am delighted that the principal historic shareholders of the Christian Salvesen Group and the Board of Christian Salvesen have agreed to support our offer. This transaction is a major step in the development of Norbert Dentressangle Group and our strategic plan to create a major player in the European market, which we view as having significant growth potential, and it will allow us to significantly expand our service offering to our customers. I am convinced that the acquisition of Christian Salvesen, will create significant value for sharholders. We look forward to working with the employees of Christian Salvesen to provide the highest level of service to our customers.”
Commenting on the Transaction, David Fish, Chairman of Christian Salvesen, said: “The Board of Christian Salvesen is recommending Norbert Dentressangle Group’s all cash offer of 92 pence. At a substantial premium of 78.6% to the undisturbed price on 24 September 2007 of 51.5p, we believe this represents a fair and attractive offer for shareholders. Christian Salvesen and Norbert Dentressangle Group have a strong strategic fit, sharing a common background, both having started life as family owned enterprises as well as being built up and developed with a spirit of innovation and entrepreneurial zeal."
Commenting on the recommended acquisition, Stewart Oades, CEO of Christian Salvesen, said: "I am pleased we have reached agreement to form an enlarged group which will provide a stronger organization, with greater opportunities for employees and customers. The combination will create a leading transport and logistics business with a wider range of services and capabilities, greater geographical coverage and a commitment to bring together the best of both businesses."
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