Acquisition
02 Dezembro 2003 - 5:02AM
UK Regulatory
RNS Number:7273S
Informa Group PLC
02 December 2003
Not for release, publication or distribution, in whole or in part, in or into
the US, Canada, Australia, The Republic of Ireland or Japan
2 December 2003
Informa Group plc - #120 million acquisition of PJB Publications Limited and
announcement of a placing of 13,280,000 ordinary shares
Introduction
Informa Group plc ("Informa" or the "Company"), the business information group,
is pleased to announce the proposed acquisition (the "Acquisition") of PJB
Publications Limited ("PJB"), an independent publisher of international business
news and information services for the pharmaceutical, agrochemical and
biotechnology industries, for #120,000,000 and a cash amount equal to the amount
of the cash balances of the PJB group at completion of the Acquisition. The cash
elements of the Acquisition consideration are to be funded from Informa's debt
facilities and the proceeds of the placing (the "Placing"), described below.
In view of its size, the Acquisition requires the approval of shareholders at an
extraordinary general meeting (the "EGM") to be held on or about 19 December
2003. A circular (the "Circular") setting out, inter alia, the proposed
resolution to approve the Acquisition, will be posted to shareholders shortly.
Information on PJB
PJB is an independent publisher of international business news and information
services for the pharmaceutical, agrochemical and biotechnology industries.
PJB's key products include Scrip, Clinica and Pharmaprojects.
Scrip is an international pharmaceutical business newsletter, providing news,
analysis, commentary and data on a twice-weekly basis. Scrip currently has circa
7,500 subscribers.
Clinica World Medical Device and Diagnostic News is a weekly international
newsletter covering the medical device and diagnostic industries. Clinica has
over 1,000 subscribers.
Pharmaprojects is an important source of worldwide business intelligence on
drugs in research and development. It tracks new drug candidates from early
discovery through the lengthy research and development process - over 7,000 at
any one time - from approximately 1,000 commercial sources.
PJB also has strong positions in the markets for information in the crop
protection, animal health and brewing industries and offers a wide portfolio of
publications and services for the ethical pharmaceutical industry, including
products specifically for the medical biotechnology sector.
PJB employs a number of information delivery methodologies, including
newsletters and journals in a variety of printed and electronic formats and
frequencies, databases (including R&D databases) and market reports.
PJB has a significant recurring revenue stream, with approximately 70 per cent.
of revenues for the year ending 31 August 2003 being generated from
subscriptions with an annual renewal rate in excess of 80 per cent. Another
approximately 18 per cent. of revenues were generated from reports and
electronic access, with approximately 12 per cent. of revenue being generated
from advertising.
PJB's principal activities are based in the UK, with an office in New York. PJB
currently has circa 240 employees.
Financial information on PJB
Summary financial information for PJB for the three years ended 31 August 2003
is set out below:
Year ended 31 August
2001 2002 2003
#m #m #m
-------------------------------------
Turnover 27.0 26.2 23.4
Operating profit 10.8 10.7 9.1
Profit before tax 11.5 11.4 9.9
Net assets 10.9 18.5 19.9
-------------------------------------
Further financial information relating to PJB for the three years ended 31
August 2003 will be set out in the Circular.
Background to and reasons for the Acquisition
Informa has previously stated its desire to build its life sciences activity and
in particular to acquire a subscription publishing portfolio to sit alongside
its existing events and publications in this important sector. The Board
considers PJB to be a premier pharmaceutical publisher with highly respected
leading brands and is delighted to have the opportunity to combine the two
businesses in order to create a market leading information company with
excellent growth prospects and solidity of earnings. In particular, the Board
believes that PJB can be quickly integrated within the Informa group and that
the combination of Informa and PJB will create a number of key benefits for
shareholders:
- the Acquisition will add significant strength to Informa's life
sciences division, bringing important critical mass and accelerated
product development capability in a growing, high value area of the
business information market;
- the leveraging of Informa's expertise in creating electronic data
delivery systems and in marketing and sales is expected to result in
Informa being able to exploit PJB's products more effectively and
deliver enhanced revenues;
- PJB does not currently run conferences and exhibitions. The Board
expects there to be significant branded conference, seminar and
exhibition opportunities, particularly those which can be branded
with PJB's key publications, described above;
- PJB has an international customer base covering a broad sector of
interests in the pharmaceutical and health care sectors -
commercial, clinical and academic. The addition of these customers
to Informa's existing customer database will create stronger
cross-marketing opportunities for both companies' life sciences
product portfolios;
- the Board expects that the proposed combination will be capable of
generating cost synergies, though the main emphasis will be on
revenue enhancements for which there should be many opportunities;
- the Acquisition will result in Informa increasing the proportion
of its subscription-based revenue, in line with the stated strategy
of the Board to build resilient recurring revenue streams; and
- the enlarged group will be well positioned to take advantage of
any upturn in economic conditions.
The Board believes that the Acquisition will be earnings enhancing in the year
ending 31 December 2004.
Principal terms and conditions of the Acquisition
Under the acquisition agreement (the "Acquisition Agreement"), Informa has
agreed to purchase the entire issued share capital of PJB for a consideration of
(i) #120 million to be satisfied on completion by #118.5 million in cash and
#1.5 million by the allotment and issue of 530,223 ordinary shares to Dr Philip
Brown, and (ii) a further cash payment by the Company of an amount equal to the
amount of the cash balances of the PJB group at completion of the Acquisition,
subject to a maximum of #31,500,000.
The Acquisition Agreement is conditional on the passing of the resolution to
approve the Acquisition at the EGM and the Company receiving the necessary
funding pursuant to the Company's new facilities agreement and the Placing.
Details of the Placing
The Placing is being undertaken to raise funds to satisfy part of the
consideration due in connection with the Acquisition. In the event that the
Acquisition does not complete, Informa will use the proceeds of the Placing to
reduce bank borrowings.
Informa is placing 13,280,000 Ordinary Shares (the "Placing Shares") at a price
of no less than 275 pence per share. The Placing Shares being issued represent
circa 9.61 per cent. of Informa's issued share capital prior to the Placing.
The price at which the Placing Shares are issued is expected to be determined
and announced as soon as practicable after the Placing closes.
The Placing is being underwritten by UBS at a price of 275 pence per share.
The Placing Shares will, when issued, rank pari passu in all respects with the
existing issued shares of Informa, save for dividends previously declared by
Informa.
In connection with the Placing, Informa has today entered into a placing
agreement ("the Placing Agreement") with UBS Limited ("UBS" or "UBS Investment
Bank"), pursuant to which UBS has conditionally agreed to use its reasonable
endeavours to procure placees for the Placing Shares. The Placing will be
conducted through a bookbuilding process.
Application will be made to the UK Listing Authority and to the London Stock
Exchange for the Placing Shares to be admitted to listing on the Official List
and to trading on the London Stock Exchange's market for listed securities
respectively (together "Admission"). It is expected that Admission will become
effective and dealings will commence in the Placing Shares at 8.00 am on 5
December 2003.
The Placing is conditional, inter alia, upon Admission becoming effective by
8.00 am on 5 December 2003 (or such later time and/or date as UBS may agree) and
on no force majeure event or material adverse change having occurred before
Admission becomes effective.
Current trading and prospects of Informa and PJB (together, the "Enlarged
Group")
The Board is expecting a satisfactory outcome for the year ending 31 December
2003 despite a business environment that continues to be challenging. With
improving business sentiment the Board is confident in the likely performance of
Informa and the Enlarged Group in 2004.
On a divisional basis, the Board has seen some marginal improvements in Finance
& Insurance and Life Sciences, although Telecoms & Media continues to experience
a difficult market. In Maritime & Transport, Informa has recently signed a
$600,000, three year contract with a US port for its Vigilance product, a
maritime security product.
The Board is pleased with the progress of the integration of MMS and MCM.
The Directors believe that PJB can be quickly integrated within Informa. They
expect this to result in both improved revenue benefits and cost efficiencies as
PJB's products are marketed to Informa's international customer base. They also
expect an acceleration of new product development in life science events and
publications to flow from the integration.
The Board is confident of the Enlarged Group's prospects for the year ending 31
December 2004, and believes that the Informa Group as enlarged by the
Acquisition will be well positioned to take advantage of any upturn in economic
conditions.
Informa is being advised by UBS Investment Bank in relation to both the
Acquisition and the Placing.
Peter Rigby, Chairman of Informa, commented:
"I am delighted that we have had the opportunity to acquire PJB as this is a
business which we have long wished to combine with our existing Life Sciences
activity. The business is in one of our core markets, providing value added,
must have information and analysis to business customers, largely on a
subscription basis.
The Acquisition is in line with our strategy of acquiring strong international
publishing brands based around value-added subscription services."
Contacts
Informa Group plc 020 7017 4302
Peter Rigby Chairman
David Gilbertson Chief Executive
Jim Wilkinson Finance Director
Bell Pottinger Financial 020 7861 3877/3887
Catherine Lees
Zoe Sanders
UBS Investment Bank 020 7567 8000
Michael Lacey-Solymar
Adam Joy
Ian Bonnor-Moris
The statement that the Board believes that the Acquisition will be earnings
enhancing does not constitute a profit forecast nor should it be interpreted to
mean that earnings per share of Informa for the current or future years will
necessarily match or exceed the historical published earnings per share of
Informa.
Statements made in this release with respect to the Company's current plans,
estimates, strategies and beliefs and other statements that are not historical
facts are forward-looking statements about the future performance of the
Company. These statements are based on management's assumptions and beliefs in
light of the information currently available to it. The Company cautions you
that a number of important risks and uncertainties could cause actual results to
differ materially from those discussed in the forward-looking statements, and
therefore you should not place undue reliance on them.
The Company does not undertake any obligation to update any forward looking
statements discussed in this announcement, whether as a result of new
information, future events or otherwise.
This announcement does not constitute an offer of securities for sale in the
United States. The Placing Shares have not been and will not be registered under
the United States Securities Act of 1933, as amended (the "Securities Act"), and
may not be offered or sold in the United States absent registration or an
exemption from registration under the Securities Act. Any public offering of
securities in the United States will be made by means of a prospectus that will
contain detailed information about the Company and the management, as well as
financial statements. Such prospectus (if any) may be obtained from the Company.
UBS is acting for Informa in connection with the Placing and the Acquisition and
no one else and will not be responsible to anyone other than Informa for
providing the protections offered to clients of UBS nor for providing advice in
relation to the Placing or the Acquisition.
Nothing in this press announcement should be construed as or be interpreted to
mean that the earnings per share of Informa for the current or future years will
necessarily match or exceed the historical or published earnings of Informa.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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