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2009-10-23 08:00:00 CEST 2009-10-23 08:00:01 CEST Ruukki Group Oyj - Tender offerACQUISITION OF SYLVANIA RESOURCES LIMITED CANCELLEDRuukki Group Plc, Stock Exchange Release, 23 October 2009 at 09:00 a.m. ACQUISITION OF SYLVANIA RESOURCES LIMITED CANCELLED Ruukki Group Plc (“Ruukki”) announced on 30 June 2009 its intention to acquire 100% of the share capital of Sylvania Resources Limited (“Sylvania”). The acquisition was to be carried out by a scheme of arrangement governed by the laws of Australia. When implementing the merger process in accordance with the merger implementation agreement signed on 30 June 2009, the parties have faced serious obstacles hampering the planned merger as well as the estimated benefits it was expected to generate. Therefore, the parties have today decided to terminate the merger implementation agreement by mutual consent. The Board of Ruukki assesses that the difficulties which have arisen would potentially have risked the financial and operative benefits to be realised via the merger. As a result, the cancellation of the merger is considered to be in the interests of the company and its shareholders. The cancellation agreement now signed states that neither party is obliged to pay any break fee due to termination. Due to the cancellation of the Sylvania acquisition, Ruukki's intention to expand its business to platinum group metals and its target to become a vertically integrated metal company will not be realised as planned. Ruukki will continue to report its minerals business as a single segment. Respectively, there will be no changes in Ruukki's shareholding consequential to the completion of the arrangement, and moreover no dilution resulting from the share issue and issuing of option rights will take place. Transaction costs incurred to date, including inter alia advisory fees, amount to approximately EUR 2.1 million, of which EUR 1.1 million relate to the first half of 2009. It is not expected that any material additional costs would be realised in relation to the original merger agreement. Ruukki has recognised the transaction costs in the group income statement according to accruals basis, and thus they already have affected the reported results as well as the profit forecast for the full financial year. Ruukki and Sylvania have decided to jointly evaluate whether there are possibilities for cooperation in the platinum group metals business based on some alternative structure. However, this analysis is still in a very preliminary phase. Ruukki will separately announce the progress of this process if needed. According to Alwyn Smit, Chief Executive Officer of Ruukki Group Plc: “Following on from the decision to terminate the merger implementation agreement with Sylvania, we will be focussed on pursuing opportunities to produce platinum group metals as part of our strategy towards vertical integration, utilising our existing smelting operations to capture additional value. The existing Ruukki furnaces, currently used for production of ferrochrome and other metal alloys can be modified to process other minerals, including PGMs.” “Subject to substantial due diligence following the announcement of the merger agreement, it was decided by both parties that operational synergies could be better exploited though more focussed joint venture opportunities. Ruukki is currently assessing a number of opportunities in this respect, which offer exciting avenues to deliver on its growth strategy and create value for shareholders.” RUUKKI GROUP PLC BOARD OF DIRECTORS Ruukki Group is an industrial group focusing minerals and wood processing businesses. Ruukki Group Plc's shares are listed on NASDAQ OMX Helsinki and traded in the mid cap segment, in the industrials sector. For additional information, please contact: Alwyn Smit Chief Executive Officer Ruukki Group Plc Telephone +41 7960 19094 www.ruukkigroup.fi NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, DIRECTLY OR INDIRECTLY, AS A WHOLE OR PARTLY IN ANY COUNTRY OR AREA, WHERE IT WOULD LEAD INTO A BREACH OF APPLICABLE LAW OR REGULATION. This stock exchange release is based on a translation into English of a document originally written in Finnish. In case of any discrepancies, inconsistencies or inaccuracies, the Finnish version shall prevail. |
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