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As Of Filer Filing For·On·As Docs:Size Issuer Agent 3/27/08 Getty Images Inc SC 13E3 10:59M Getty Images Inc Donnelley … Solutions/FA Abe Acquisition Corp. Abe Investment, L.P. Getty Investments L.L.C. Hellman & Friedman Capital Partners VI, L.P. Jonathan Klein Mark Getty |
Document/Exhibit Description Pages Size 1: SC 13E3 Tender-Offer Statement - Going-Private Transaction HTML 140K 2: EX-99.(B)(1) Senior Secured Credit Facilities Commitment HTML 177K Letter 3: EX-99.(C)(2) Presentation of Goldman Sachs to the Board of HTML 178K Directors, Dated February 24, 2008 4: EX-99.(C)(3) Draft Presentation of Goldman Sachs, Dated HTML 189K February 18, 2008 5: EX-99.(C)(4) Draft Presentation of Goldman Sachs, Dated HTML 200K February 7, 2008 6: EX-99.(C)(5) Draft Presentation of Goldman Sachs, Dated HTML 104K December 2007 7: EX-99.(C)(6) Draft Presentation of Goldman Sachs, Dated HTML 71K November 28, 2007 8: EX-99.(C)(7) Draft Presentation of Goldman Sachs, Dated HTML 33K November 6, 2007 9: EX-99.(C)(8) Draft Presentation of Goldman Sachs, Dated HTML 112K October 10, 2007 10: EX-99.(C)(9) Draft Presentation of Goldman Sachs, Dated HTML 222K September 19, 2007
Draft Presentation of Goldman Sachs, dated December 2007 |
Exhibit (C) (5)
Goldman
Sachs
Project Closeup Discussion Materials
Goldman, Sachs & Co.
December 2007
Goldman
Sachs
I. Potential Strategic Buyer Accretion/Dilution Analysis
II. Stub Equity Alternative Deal Structures
Goldman Sachs does not provide accounting, tax, or legal advice. Notwithstanding anything in this document to the contrary, and except as required to enable compliance with applicable securities law, you (and each of your employees, representatives, and other agents) may disclose to any and all persons the US federal income and state tax treatment and tax structure of the transaction and all materials of any kind (including tax opinions and other tax analyses) that are provided to you relating to such tax treatment and tax structure, without Goldman Sachs imposing any limitation of any kind.
Goldman
Sachs
I. Potential Strategic Buyer Accretion/Dilution Analysis
1
Goldman
Sachs
Potential Strategic Buyers
Illustrative Sample List
Market Cap
Enterprise Value
Cash
‘08 EV/EBITDA
‘08 P/E
IBES LT EPS Growth
Gettyimages®
$1,719
$1,761
$303
5.6x
12.8x
10.0%
Adobe
$25,637
$23,681
$1,956
14.7x
23.2x
15.0%
218,236
208,249
9,987
21.0
32.5
30.0
News Corporation
54,051
50,639 1
8,777 2
7.6
16.0
18.8
Reuters
15,751
16,782
759
13.0
20.8
22.4
SONY
56,725
56,650
8,751
6.7
17.0
32.9
1Adjusted enterprise value deducts value of holdings in public assets. Market data as of 03-Dec-2007. Multiples based on IBES median estimates as of 03-Dec-2007. Market cap and Enterprise value are fully diluted.
2$1,247mm cash added for senior notes issuance; $588mm cash subtracted per Liberty Media exchange agreement
Note: News Corp. not pro forma for $5.6bn Dow Jones acquisition – expected to close calendar Q4 2007
Note: Reuters not pro forma for announced $18.3bn Thompson Corp. acquisition
Source: Public filings and IBES
2
Goldman
Sachs
Pro Forma Financial Impact
Adobe Acquires Getty
100% Stock
Purchase Price Per Share
$34.57
$40.33
$46.10
Premium to Market Price
20%
40%
60%
Equity Consideration – Diluted
$2,067
$2,419
$2,772
Enterprise Value
2,149
2,501
2,854
Sources of Financing
Cash as Source of Purchase Price1
$0
$0
$0
Amount of New Debt Required
0
0
0
Financing Fees
0
0
0
Total Incremental Debt Required
$0
$0
$0
Ownership
Acquiror New Shares Issued – Diluted
48.4
56.7
64.9
Target’s Ownership in Pro Forma
7.5%
8.6%
9.8%
2008E Accretion / Dilution2
Acquiror Standalone EPS
$1.82
$1.82
$1.82
Pro Forma Combined EPS
1.91
1.88
1.86
Accretion / Dilution (%)
5.0%
3.7%
2.4%
Pre-Tax Synergies to EPS Breakeven
$(78.9)
$(58.8)
$(38.6)
as a % of Target’s SG&A
N.M.
N.M.
N.M.
100% Cash
Purchase Price Per Share
$34.57
$40.33
$46.10
Premium to Market Price
20%
40%
60%
Equity Consideration – Diluted
$2,067
$2,419
$2,772
Enterprise Value
2,149
2,501
2,854
Sources of Financing
Cash as Source of Purchase Price1
$1,241
$1,241
$1,241
Amount of New Debt Required
826
1,178
1,531
Financing Fees
0
0
0
Total Incremental Debt Required
$826
$1,178
$1,531
Ownership
Acquiror New Shares Issued – Diluted
0.0
0.0
0.0
Target’s Ownership in Pro Forma
0.0%
0.0%
0.0%
2008E Accretion / Dilution2
Acquiror Standalone EPS
$1.82
$1.82
$1.82
Pro Forma Combined EPS
1.90
1.87
1.83
Accretion / Dilution (%)
4.7%
2.8%
0.9%
Pre-Tax Synergies to EPS Breakeven
$(68.9)
$(40.7)
$(12.5)
as a % of Target’s SG&A
N.M.
N.M.
N.M.
1Assumes use of 100% of target’s cash and up to 50% of acquiror’s cash; cash as source of purchase price includes equity consideration and liquidity of options.
2Assumes IBES median estimates as of 03-Dec-2007. Assumes acquiror’s tax rate of 25.6%, 5.0% opportunity cost of cash and 8.0% cost of debt. Pre-tax synergies to breakeven as % of Target’s SG&A based on target’s LTM SG&A.
Note: Adobe and Getty estimates exclude ESO (assumed to be $19.9mm for Getty per Getty management estimates) taxed at 34.4% for CY 2008. Merger math does not include potential tax benefits from tax deductibility of options. Enterprise value shown assumes cash after $40mm in convertible tax leakage.
3
Goldman
Sachs
Pro Forma Financial Impact
Google Acquires Getty
100% Stock
Purchase Price Per Share
$34.57
$40.33
$46.10
Premium to Market Price
20%
40%
60%
Equity Consideration – Diluted
$2,067
$2,419
$2,772
Enterprise Value
2,149
2,501
2,854
Sources of Financing
Cash as Source of Purchase Price1
$0
$0
$0
Amount of New Debt Required
0
0
0
Financing Fees
0
0
0
Total Incremental Debt Required
$0
$0
$0
Ownership
Acquiror New Shares Issued – Diluted
3.0
3.5
4.1
Target’s Ownership in Pro Forma
0.9%
1.1%
1.3%
2008E Accretion / Dilution2
Acquiror Standalone EPS
$20.95
$20.95
$20.95
Pro Forma Combined EPS
21.21
21.18
21.14
Accretion / Dilution (%)
1.2%
1.1%
0.9%
Pre-Tax Synergies to EPS Breakeven
$(113.0)
$(98.4)
$(83.8)
as a % of Target’s SG&A
N.M.
N.M.
N.M.
100% Cash
Purchase Price Per Share
$34.57
$40.33
$46.10
Premium to Market Price
20%
40%
60%
Equity Consideration – Diluted
$2,067
$2,419
$2,772
Enterprise Value
2,149
2,501
2,854
Sources of Financing
Cash as Source of Purchase Price1
$2,067
$2,419
$2,772
Amount of New Debt Required
0
0
0
Financing Fees
0
0
0
Total Incremental Debt Required
$0
$0
$0
Ownership
Acquiror New Shares Issued – Diluted
0.0
0.0
0.0
Target’s Ownership in Pro Forma
0.0%
0.0%
0.0%
2008E Accretion / Dilution2
Acquiror Standalone EPS
$20.95
$20.95
$20.95
Pro Forma Combined EPS
21.17
21.13
21.09
Accretion / Dilution (%)
1.1%
0.9%
0.7%
Pre-Tax Synergies to EPS Breakeven
$(95.4)
$(77.8)
as a % of Target’s SG&A
N.M.
N.M.
N.M.
1Assumes use of 100% of target’s cash and up to 50% of acquiror’s cash; cash as source of purchase price includes equity consideration and liquidity of options.
2Assumes IBES median estimates as of 03-Dec-2007. Assumes acquiror’s tax rate of 25.9%, 5% opportunity cost of cash and 8% cost of debt. Pre-tax synergies to breakeven as % of Target’s SG&A based on target’s LTM SG&A.
Note: Google and Getty estimates exclude ESO (assumed to be $19.9mm for Getty per Getty management estimates) taxed at 34.4% for CY 2008. Merger math does not include potential tax benefits from tax deductibility of options, Enterprise value shown assumes cash after $40mm in convertible tax leakage.
4
Goldman
Sachs
Pro Forma Financial Impact
News Corporation Acquires Getty
100% Stock
Purchase Price Per Share
$34.57
$40.33
$46.10
Premium to Market Price
20%
40%
60%
Equity Consideration – Diluted
$2,067
$2,419
$2,772
Enterprise Value
2,149
2,501
2,854
Sources of Financing
Cash as Source of Purchase Price1
$0
$0
$0
Amount of New Debt Required
0
0
0
Financing Fees
0
0
0
Total Incremental Debt Required
$0
$0
$0
Ownership
Acquiror New Shares Issued – Diluted
95.8
112.1
128.5
Target’s Ownership in Pro Forma
3.6%
4.2%
4.8%
2008E Accretion / Dilution2
Acquiror Standalone EPS
$1.49
$1.49
$1.49
Pro Forma Combined EPS
1.49
1.48
1.47
Accretion / Dilution (%)
(0.3)%
(0.9)%
(1.5)%
Pre-Tax Synergies to EPS Breakeven
$20.6
$59.2
$97.9
as a % of Target’s SG&A
6.3%
18.1%
30.0%
50/50% Stock/Cash
Purchase Price Per Share
$34.57
$40.33
$46.10
Premium to Market Price
20%
40%
60%
Equity Consideration – Diluted
$2,067
$2,419
$2,772
Enterprise Value
2,149
2,501
2,854
Sources of Financing
Cash as Source of Purchase Price1
$1,033
$1,209
$1,386
Amount of New Debt Required
0
0
0
Financing Fees
0
0
0
Total Incremental Debt Required
$0
$0
$0
Ownership
Acquiror New Shares Issued – Diluted
47.9
56.1
64.2
Target’s Ownership in Pro Forma
1.8%
2.1%
2.4%
2008E Accretion / Dilution2
Acquiror Standalone EPS
$1.49
$1.49
$1.49
Pro Forma Combined EPS
1.50
1.49
1.49
Accretion / Dilution (%)
0.7%
0.2%
(0.2)%
Pre-Tax Synergies to EPS Breakeven
$(41.0)
$(12.9)
$ 15.2
as a % of Target’s SG&A
N.M.
N.M.
4.7%
1Assumes use of 100% of target’s cash and up to 50% of acquiror’s cash; cash as source of purchase price includes equity consideration and liquidity of options.
2Assumes IBES median estimates as of 03-Dec-2007. Assumes acquiror’s tax rate of 37.0%, 5% opportunity cost of cash and 8% cost of debt. Pre-tax synergies to breakeven as % of Target’s SG&A based on target’s LTM SG&A. News Corporation not pro forma for Dow Jones acquisition.
Note: News Corp. and Getty EPS estimates include ESO expense. Merger math does not include potential tax benefits from tax deductibility of options. Enterprise value shown assumes cash after $40mm in convertible tax leakage.
5
Goldman
Sachs
Pro Forma Financial Impact
Reuters Acquires Getty
100% Stock
Purchase Price Per Share
$34.57
$40.33
$46.10
Premium to Market Price
20%
40%
60%
Equity Consideration – Diluted
$2,067
$2,419
$2,772
Enterprise Value
2,149
2,501
2,854
Sources of Financing
Cash as Source of Purchase Price1
$0
$0
$0
Amount of New Debt Required
0
0
0
Financing Fees
0
0
0
Total Incremental Debt Required
$0
$0
$0
Ownership
Acquiror New Shares Issued – Diluted
168.3
197.0
225.7
Target’s Ownership in Pro Forma
11.5%
13.2%
14.8%
2008E Accretion / Dilution2
Acquiror Standalone EPS
$0.59
$0.59
$0.59
Pro Forma Combined EPS
0.61
0.60
0.59
Accretion / Dilution (%)
4.1%
2.1%
0.1%
Pre-Tax Synergies to EPS Breakeven
$(50.0)
$(25.8)
$(1.6)
as a % of Target’s SG&A
N.M.
N.M.
N.M.
50/50% Stock/Cash
Purchase Price Per Share
$34.57
$40.33
$46.10
Premium to Market Price
20%
40%
60%
Equity Consideration – Diluted
$2,067
$2,419
$2,772
Enterprise Value
2,149
2,501
2,854
Sources of Financing
Cash as Source of Purchase Price1
$642
$642
$642
Amount of New Debt Required
391
567
743
Financing Fees
0
0
0
Total Incremental Debt Required
$391
$567
$743
Ownership
Acquiror New Shares Issued – Diluted
84.2
98.5
112.8
Target’s Ownership in Pro Forma
6.1%
7.1%
8.0%
2008E Accretion / Dilution2
Acquiror Standalone EPS
$0.59
$0.59
$0.59
Pro Forma Combined EPS
0.62
0.61
0.59
Accretion / Dilution (%)
5.0%
2.7%
0.4%
Pre-Tax Synergies to EPS Breakeven
$(57.5)
$(31.4)
$(5.1)
as a % of Target’s SG&A
N.M.
N.M.
N.M.
1Assumes use of 100% of target’s cash and up to 50% of acquiror’s cash; cash as source of purchase price includes equity consideration and liquidity of options.
2Assumes IBES median estimates as of 03-Dec-2007. Assumes acquiror’s tax rate of 30%, 5% opportunity cost of cash and 8% cost of debt. Pre-tax synergies to breakeven as % of Target’s SG&A based on target’s LTM SG&A.
Note: Reuters and Getty EPS estimates include ESO expense. Merger math does not include potential tax benefits from tax deductibility of options. Enterprise value shown assumes cash after $40mm in convertible tax leakage.
6
Goldman
Sachs
Pro Forma Financial Impact
Sony Acquires Getty
100% Stock
Purchase Price Per Share
$34.57
$40.33
$46.10
Premium to Market Price
20%
40%
60%
Equity Consideration – Diluted
$2,067
$2,419
$2,772
Enterprise Value
2,149
2,501
2,854
Sources of Financing
Cash as Source of Purchase Price1
$0
$0
$0
Amount of New Debt Required
0
0
0
Financing Fees
0
0
0
Total Incremental Debt Required
$0
$0
$0
Ownership
Acquiror New Shares Issued – Diluted
38.3
44.8
51.4
Target’s Ownership in Pro Forma
3.7%
4.3%
4.9%
2008E Accretion / Dilution2
Acquiror Standalone EPS
$3.25
$3.25
$3.25
Pro Forma Combined EPS
3.25
3.23
3.21
Accretion / Dilution (%)
0.1%
(0.5)%
(1.1)%
Pre-Tax Synergies to EPS Breakeven
$(5.4)
$31.1
$67.7
as a % of Target’s SG&A
N.M.
9.5%
20.7%
100% Cash
Purchase Price Per Share
$34.57
$40.33
$46.10
Premium to Market Price
20%
40%
60%
Equity Consideration – Diluted
$2,067
$2,419
$2,772
Enterprise Value
2,149
2,501
2,854
Sources of Financing
Cash as Source of Purchase Price1
$2,067
$2,419
$2,772
Amount of New Debt Required
0
0
0
Financing Fees
0
0
0
Total Incremental Debt Required
$0
$0
$0
Ownership
Acquiror New Shares Issued – Diluted
0.0
0.0
0.0
Target’s Ownership in Pro Forma
0.0%
0.0%
0.0%
2008E Accretion / Dilution2
Acquiror Standalone EPS
$3.25
$3.25
$3.25
Pro Forma Combined EPS
3.31
3.30
3.29
Accretion / Dilution (%)
2.0%
1.7%
1.4%
Pre-Tax Synergies to EPS Breakeven
$(116.6)
$(99.0)
$(81.3)
as a % of Target’s SG&A
N.M.
N.M.
N.M.
1Assumes use of 100% of target’s cash and up to 50% of acquiror’s cash; cash as source of purchase price includes equity consideration and liquidity of options.
2Assumes IBES median estimates as of 03-Dec-2007. Assumes acquiror’s tax rate of 42%, 5% opportunity cost of cash and 8% cost of debt. Pre-tax synergies to breakeven as % of Target’s SG&A based on target’s LTM SG&A.
Note: Sony and Getty EPS estimates include ESO expense. Merger math does not include potential tax benefits from tax deductibility of options. Enterprise value shown assumes cash after $40mm in convertible tax leakage.
7
Goldman
Sachs
II. Stub Equity Alternative Deal Structures
8
Goldman
Sachs
“Stub Equity” in the LBO Context
Description
A portion of target shareholders’ equity is rolled over into “NewCo”
Target shareholders can choose whether to receive cash for their shares or to rollover (or some combination thereof)
— If over subscribed, NewCo equity will be issued on a pro-rated basis
Selected Benefits
Allows existing public shareholders to retain an interest in the company under new majority shareholder(s)
Allows sponsor(s) to put more equity capital to work by reducing the amount needed to be raised from other co-investors
The exchange of the target’s shares for NewCo’s shares, when taken together with the sponsor’s contribution of cash, may qualify as a tax-free Section 351 exchange, generally allowing electing shareholders to defer at least a portion of their gain in the transaction
Selected Considerations
Stub equity holders of NewCo likely to be minority investors with limited influence over NewCo governance
Complex to structure
May involve registration, listing and Exchange Act reporting requirements; Sarbanes-Oxley may continue to apply under certain structures
Stub equity may have limited liquidity and valuation could be challenging
If public shares are offered for stub equity, buyer / rollover equity holders may be taxed on the capital gain on the shares received
9
Goldman
Sachs
Trading and Liquidity Considerations
Trading Alternatives for Stub Equity
Public Exchange (e.g., NYSE, NASDAQ, etc.)
Pink Sheets or other OTC Mechanism
Proprietary Platform (e.g., GS TrUE)
No Trading / Complete Private Holdings
Public
Private
Considerations
Institutional shareholders may have limited ability to hold alternative investments
Inability to “mark-to-market” the value of the equity investment may also constrain some potential investors
Certain listing venues may require registration and public filings
10
Goldman
Sachs
Selected Case Studies
Date
Status
Target
Acquirer / Sponsor(s)
Summary
April 2007
Terminated
Harman International
KKR and GSCP
In April 2007, Harman announced it had agreed to be acquired by KKR and GS Capital Partners for $120 per share, or an aggregate value of ~$8bn
As part of the transaction, the sponsors offered Harman shareholders the option to receive cash or up to a 27% equity stake in Newco
— If over-subscribed, Newco shares would be allocated on a pro-rata basis and the remaining Harman shares exchanged for cash
April 2007
Pending
Clear Channel
TH Lee and Bain Capital
After TH Lee and Bain Capital’s November 2006 initial announcement to acquire Clear Channel faced shareholder objections, the sponsors increased their cash bid by $1.40/share to $39 on April 18th
When the merger proxy was filed on April 25th, the document confirmed the sponsors had considered offering shareholders an up to 10% stake in the new company in order to gain their support
— The proxy stated the funds had told the Board they would pay $38.50 a share “in either, or a combination of, cash and/or shares of stock in the surviving corporation,” at the discretion of each shareholder. The amount of equity would be capped at 10% of Clear Channel’s outstanding shares
— Shareholders also would receive up to an additional $2 a share if the growth rate of the company’s radio business exceeded 2% a year
— As the Board was uncertain the Company could achieve those financial targets, the directors pushed the sponsors to offer a higher bid all in cash
On May 18th, the sponsors increased their bid to $39.20/share and included an option whereby current shareholders could take an up to 30% stake in the new company
April 2007
Not Completed Under These Deal Terms
Chrysler
Tracinda (Kirk Kerkorian)
As part of its $4.5 billion offer for Chrysler, Tracinda met with the United Auto Workers, Chrysler’s largest union, to say it would consider giving the UAW a “substantial share of equity” as part of the deal
— The employee buyout committee had separately sent a formal proposal to DaimlerChrysler, offering to take a 70% stake in the company over a period of five years or more on behalf of its roughly 50,000 U.S. factory workers
On May 15th, Cerberus announced it had agreed to purchase the Company
11
Goldman
Sachs
Selected Case Studies
Date
Status
Target
Acquirer / Sponsor(s)
Summary
April 2007
Not Completed Under These Deal Terms
J Sainsbury Plc
CVC, Blackstone and TPG
On April 10th, a consortium comprised of CVC, Blackstone and TPG increased its bid for Sainsbury from 562 pence/share to 582 pence/share
— In addition to the increased offer, the CVC-led proposal offered as much as 15% of the equity to about 80,000 employees and up to 25% of the equity to existing shareholders in the form of stub equity
— Blackstone and TPG subsequently dropped out of the consortium
After members of the Sainsbury family said they would not entertain a bid for less than 600 pence/share, CVC ultimately withdrew its bid for the company
February 2007
Completed
Countrywide plc
Apollo
In February 2007, Apollo offered £1bn for Countrywide, approximately 3% more than the offer from 3i Group that shareholders had rejected as too low the prior month
— As part of the offer, however, Apollo offered shareholders the option to exchange some or all of the cash for a continued unlisted investment in Countrywide, up to a maximum of £100mm
On April 12th, after the Company received an approach from a third party, Apollo increased its offer and subsequently received shareholder approval
— The value of the stub equity portion of the deal increased to £137.5mm
On May 1st, Apollo again increased the offer after Countrywide said it had received a “non-binding proposal from a third party in relation to a possible competing offer” for the Company, which contained a higher cash element than the Apollo bid
— Apollo proposed raising the stub equity portion to 55% (£152.5mm); Apollo, however, would still retain control of the Company via its Class A voting shares (vs. the Class B nonvoting shares issued to stub equity holders)
12
Goldman
Sachs
Selected Case Studies
Date
Status
Target
Acquirer / Sponsor(s)
Summary
October 2006
Not Completed Under These Deal Terms
St. Ives Plc
Tangent Communications
In October 2006, St. Ives confirmed it had received an offer from Tangent Communications worth 272.5 pence/share
— The offer was comprised of 200 pence/share in cash with the remainder in new Tangent equity
— Existing St. Ives shareholders would hold approximately 41% of the combined company
— St. Ives’ Board subsequently rejected the offer
In November 2006, Tangent dropped its bid for the company
September 2006
Not Completed Under These Deal Terms
Incisive Media
Apax
On September 21st, 2006, Incisive Media recommended a cash offer of 195 pence/share from Apax
— The deal also offered existing shareholders up to 25% of the Newco shares. The shares would not be publicly traded, but rather would be retained as a minority stake in the Apax holding vehicle, with appropriate minority protection rights
— Shareholders Standard Life (11.5% owner) and Scottish Widows (9%) subsequently questioned the terms of the deal
— Under the final terms of the deal, the cash consideration payable under the terms of the offer were provided by way of equity financing provided by Apax Partners funds and re-investment by the management team, and by debt financing under committed facilities arranged and fully underwritten by the Royal Bank of Scotland.
In November 2006, Ingenious Media Active Capital (IMAC) acquired 11% of the Company and said it had the intention of supporting the Apax bid and participating in Incisive when it was taken private
13
Goldman
Sachs
Selected Case Studies
Date
Status
Target
Acquirer / Sponsor(s)
Summary
April 2006
Not Completed Under These Deal Terms
BAA plc
Ferrovial
In March 2006, Ferrovial made an offer for BAA for 810 pence/share in cash, which the Company subsequently rejected
— In late April, BAA also rejected a bid led by Goldman Sachs
On May 30th, Ferrovial raised its offer to 900 pence/share, which the Company also rejected
On June 5th, Ferrovial again raised its offer to 915 pence/share; the offer was again raised on June 6th to 950 pence/share, which the Company accepted
— In addition, shareholders and convertible bondholders had the option to participate in a “Partial Share Alternative” in which shares issued in a Newco, Altitude Assets plc, would be listed on the AIM market of the London Stock Exchange. Altitude Assets was expected to hold between a 5-10% stake in the Holdco of the new company
On July 4th, Ferrovial scrapped its Partial Share Alternative after failing to receive sufficient valid acceptances for the option
June 2004
Not Completed Under These Deal Terms
Marks & Spencer
Revival Acquisitions (Philip Green)
In June 2004, Revival said it was prepared to make an offer for M&S of between 290-310 pence/share, plus a 25% interest in the equity of the Revival group in the form of a listed security
— M&S subsequently rejected the offer and said it “significantly” undervalued the Company
In July 2004, Green increased his offer to 400 pence/share in cash or a cash and share alternative comprising 335 pence/share in cash and a 30% equity interest in the Revival group, which the Company again rejected
In late July, Green dropped his bid for the Company after he concluded that Revival would not “gain the cooperation of the board of M&S to provide it access to the information necessary for Revival to make its offer”
January 2004
Completed
Chelsfield plc
Duelguide plc
Duelguide, a company chaired by Chelsfield Chairman Elliott Bernerd, said Chelsfield’s board recommended its increased 320 pence/share offer
— The offer was comprised of 280 pence in cash and 40 pence in Duelguide Units (non-listed), of which 35 pence could be taken in cash
The deal subsequently received 97% acceptance by shareholders
14
Goldman
Sachs
Selected Case Studies
Date
Status
Target
Acquirer / Sponsor(s)
Summary
December 2003
Not Completed Under These Deal Terms
Canary Wharf
Morgan Stanley Real Estate Funds (MSREF)
After initially rejecting a £1.5bn offer for Canary Wharf, the Company accepted a revised bid from MSREF which was comprised of 220 pence/share in cash and 45 pence/share in shares in the new holding company
— The shares would be holding company shares with limited voting rights and would represent ~33% of the share capital of the Company
— Investors also had the option to receive a 100% cash alternative
October 2003
Completed
Inmarsat
Apax and Permira
After a 14-month takeover battle, Apax and Permira’s acquisition vehicle Grapeclose Ltd. agreed to offer $15 cash per ordinary share (up from a reported $14.25)
— The deal also provided an option for shareholders to receive part of the payment in Grapeclose’s parent, Duchessgrove
— At the time of the deal, Inmarsat was largely owned by former European telecom monopolies, including Norway’s Telenor ASA (15%), Britain’s BT Group (7.9%), the Netherlands-based Xantic BV (5.9%), France Telecom SA (5.1%) and Germany’s Deutsche Telekom AG (4.3%). Japan’s KDDI Corp. owned another 7.6%
15