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Pension Corporation offer to acquire telent plcNOT FOR RELEASE, PUBLICATION OR DISTRIBUTION IN WHOLE OR IN PART IN, INTO OR FROM ANY JURISDICTION WHERE TO DO SO WOULD CONSTITUTE A VIOLATION OF THE RELEVANT LAWS OR REGULATIONS OF SUCH JURISDICTION
25 September 2007
Summary CILP and the Board of telent announce a recommended cash offer for telent of 600p per telent Share (the “Offer”). The Offer values telent at approximately £398 million. The Offer represents a premium of approximately:
Under the terms of the Offer, telent Shareholders on the register as at 21 September 2007 will retain the right to receive on 17 October 2007 the final dividend of 11p per telent Share for the year ended 31 March 2007 announced on 16 May 2007. CILP has unconditionally agreed to acquire 16,500,000 telent Shares, representing (as at the date of this announcement) approximately 26.39 per cent. of the existing issued ordinary share capital of telent. Further, as at the close of business on 24 September 2007, being the last practicable business day prior to this announcement, CILP owned 1,869,372 telent Shares representing approximately 2.99 per cent. of the existing issued ordinary share capital of telent. CILP is a Guernsey limited partnership whose general partner is Pension Corporation GP Limited (“PCGP”), a Guernsey limited company which is authorised by the Guernsey Financial Services Commission. PCGP is advised by Pension Corporation. The Directors of telent, who have been so advised by Lazard, consider the terms of the Offer to be fair and reasonable. In providing advice to the Directors of telent, Lazard has taken into account the commercial assessments of the Directors of telent. Accordingly, the Directors of telent intend to recommend unanimously that telent Shareholders accept the Offer. Those Directors of telent who own telent Shares, or have options over telent Shares, have irrevocably undertaken to accept the Offer in respect of their own telent Shares and in respect of those telent Shares which may be issued to them on the exercise of options. Mr Edmund Truell, Group Chief Executive Officer of Pension Corporation, said: “The strength of telent’s UK pension fund is vitally important to over 62,000 people; a legacy from what was once the second largest industrial company in the UK. We intend to apply Pension Corporation’s market leading pensions investment and administrative approach to support and enhance the management of the GEC plan. “We have established Pension Corporation to be a holder of pension funds over the long term. With the excellent quality of our Board and management team, substantial committed funding from our investors and our expertise in managing pension assets and liabilities, we are able to demonstrate our commitment to responsible pension stewardship. “With this Offer we are also providing telent shareholders with the ability to realise their investment for cash at an attractive value. Once private, we intend to free up Mark Plato and his management team to focus on the operating business and give them our full support in re-building a strong and high quality service business.” Mr John Devaney, Chairman of telent, said: “We believe the cash offer of 600p per share from Pension Corporation is a compelling one for shareholders, given the prospects for the operating company and the position of the UK pension fund. The offer represents an attractive premium over the pre-bid price and shareholders will also receive the dividend of 11p per share that has already been approved. This is a good outcome for shareholders and will allow the management team to focus exclusively on the development of the operating business.” This summary should be read in conjunction with and is subject to the full text of the attached announcement and the appendices. Certain terms used in this summary are defined in Appendix IV to the attached announcement. Merrill Lynch is acting as exclusive financial adviser and corporate broker to CILP and Pension Corporation. Lazard is acting exclusively as financial adviser to telent. telent has also received financial advice from JPMorgan Cazenove, its corporate broker.
Enquiries: Pension CorporationTelephone: +44 (0) 20 7451 6599 Charlotte Crosswell Merrill LynchTelephone: +44 (0) 20 7628 1000 Philip Noblet Noah Bulkin Michael Findlay (Corporate Broking)
Equus GroupTelephone: +44 (0) 20 7223 1100 Piers Hooper James Sumpster telent plcTelephone: +44 (0) 20 7005 6260 Monica Coull LazardTelephone: +44 (0) 20 7187 2000 Nicholas Jones Peter Warner Francois Barou JPMorgan CazenoveTelephone: +44 (0) 20 7588 2828 Andrew Hodgkin Threadneedle CommunicationsTelephone: +44 (0) 20 7936 9604 John Coles
This announcement is not intended to and does not constitute, or form part of, an offer to sell or invitation to purchase or subscribe for any securities or the solicitation of any vote or approval in any jurisdiction pursuant to the Offer or otherwise, nor will there be any purchase or transfer of the securities referred to in this announcement in any jurisdiction in contravention of applicable law or regulation. The Offer will be made solely through the Offer Document and, in the case of certificated telent Shares, the Forms of Acceptance accompanying the Offer Document, which will contain the full terms and conditions of the Offer, including details of how to accept the Offer. Any acceptance or other response to the Offer should be made only on the basis of the information in such documents. Merrill Lynch, which is regulated in the UK by the Financial Services Authority, is acting exclusively for CILP and Pension Corporation and no one else in connection with the Offer and will not be responsible to anyone other than CILP and Pension Corporation for providing the protections afforded to customers of Merrill Lynch or for giving advice in relation to the Offer. Lazard and JPMorgan Cazenove, which are regulated in the UK by the Financial Services Authority, are acting exclusively for telent and no one else in connection with the Offer and will not be responsible to anyone other than telent for providing the protections afforded to the respective customers of Lazard or JPMorgan Cazenove nor for giving advice in relation to the Offer. The availability of the Offer to persons who are not resident in the UK may be affected by the laws of the relevant jurisdictions. Persons who are not so resident should inform themselves about, and observe, any applicable requirements. Further details in relation to overseas shareholders will be contained in the Offer Document. The release, publication or distribution of this announcement in jurisdictions other than the UK may be restricted by law and/or regulation and therefore any persons who are subject to the laws and regulations of any jurisdiction other than the UK should inform themselves about, and observe, any applicable requirements. Any failure to comply with the applicable requirements may constitute a violation of the laws and/or regulations of any such jurisdiction. This announcement has been prepared for the purpose of complying with English law and the Code and the information disclosed may not be the same as that which would have been disclosed if this announcement had been prepared in accordance with the laws and/or regulations of jurisdictions outside the UK. Any person (including, without limitation, any custodian, nominee and trustee) who would, or otherwise intends to, or who may have a contractual or legal obligation to, forward this announcement and/or the Offer Document and/or any other related document to any jurisdiction outside the UK should inform themselves of, and observe, any applicable legal or regulatory requirements of their jurisdiction. Notice to US investors This announcement does not constitute, or form part of, any offer for, or any solicitation of any offer for securities, nor is it a solicitation of any vote or approval in any jurisdiction, nor will there by any purchase or transfer of the securities referred to in this announcement in any jurisdiction in contravention of applicable law or regulation. The Offer is being made for securities of a UK company and United States investors should be aware that this announcement, the Offer Document and any other documents relating to the Offer have been or will be prepared in accordance with the Code and UK disclosure requirements, format and style, all of which differ from those in the United States. telent’s financial statements, and all financial information that is included in this announcement or that may be included in the Offer Document or any other documents relating to the Offer, have been or will be prepared in accordance with United Kingdom generally accepted accounting principles and International Financial Reporting Standards and thus may not be comparable to financial statements of United States companies. The Offer will be made in the United States pursuant to applicable US tender offer rules and otherwise in accordance with the requirements of the Code. Accordingly, the Offer will be subject to disclosure and other procedural requirements, including with respect to withdrawal rights, offer timetable, settlement procedures and timing of payments that are different from those applicable under US domestic tender offer procedures and law. The receipt of cash pursuant to the Offer by a United States holder of telent Shares may be a taxable transaction for United States federal income tax purposes and under applicable US state and local, as well as foreign and other tax laws. Each holder of telent Shares is urged to consult his independent professional adviser immediately regarding the tax consequences of acceptance of the Offer. telent is incorporated under the laws of England and Wales. All of the telent Directors are residents of countries other than the United States. As a result, it may not be possible for United States shareholders of telent to effect service of process within the United States upon telent or such telent Directors or to enforce against any of them judgements of the United States predicated upon the civil liability provisions of the federal securities laws of the United States. It may not be possible to sue telent or its officers or directors in a non-US court for violations of the US securities laws. In accordance with the Code and normal UK market practice and pursuant to class exemptive relief granted by the Staff of the Division of Market Regulation of the US Securities and Exchange Commission, CILP or its nominees or brokers (acting as agents) may from time to time during the period in which the Offer remains open for acceptance make certain purchases of, or arrangements to purchase, telent Shares otherwise than under the Offer, such as in open market or privately negotiated purchases. Such purchases, or arrangements to purchase, will comply with all applicable UK rules, including the Code and the rules of the London Stock Exchange. In addition, in accordance with the Code, normal UK market practice and Rule 14e-5(b) of the Exchange Act, Merrill Lynch will continue to act as exempt principal traders in telent securities on the London Stock Exchange. Information regarding such activities which is required to be made public in the United Kingdom pursuant to the Code will be reported to a Regulatory Information Service and will be available on the London Stock Exchange website at www.londonstockexchange.com. This information will also be publicly disclosed in the United States to the extent that such information is made public in the United Kingdom. Forward-looking statements This announcement may contain "forward-looking statements" concerning the Offer, CILP and telent. Generally, the words "will", "may", "should", "continue", "believes", "expects", "intends", "anticipates" or similar expressions identify forward-looking statements. The forward-looking statements involve risks and uncertainties that could cause actual results to differ materially from those expressed in the forward-looking statements. Many of these risks and uncertainties relate to factors that are beyond the companies' abilities to control or estimate precisely, such as future market conditions and the behaviours of other market participants, and therefore undue reliance should not be placed on such statements. CILP and telent assume no obligation and do not intend to update these forward-looking statements, except as required pursuant to applicable law and regulation. Dealing Disclosure Requirements Under the provisions of Rule 8.3 of the Code, if any person is, or becomes, "interested" (directly or indirectly) in 1 per cent. or more of any class of "relevant securities" of telent, all "dealings" in any "relevant securities" of telent (including by means of an option in respect of, or a derivative referenced to, any such "relevant securities") must be publicly disclosed by no later than 3.30 p.m. (London time) on the London business day following the date of the relevant transaction. This requirement will continue until the date on which the offer becomes, or is declared, unconditional as to acceptances, lapses or is otherwise withdrawn or on which the "offer period" otherwise ends. If two or more persons act together pursuant to an agreement or understanding, whether formal or informal, to acquire an "interest" in "relevant securities" of telent, they will be deemed to be a single person for the purpose of Rule 8.3. Under the provisions of Rule 8.1 of the Code, all "dealings" in "relevant securities" of telent by CILP or telent, or by any of their respective "associates", must be disclosed by no later than 12.00 noon (London time) on the London business day following the date of the relevant transaction. A disclosure table, giving details of the companies in whose "relevant securities" "dealings" should be disclosed, and the number of such securities in issue, can be found on the Takeover Panel's website at www.thetakeoverpanel.org.uk. "Interests in securities" arise, in summary, when a person has long economic exposure, whether conditional or absolute, to changes in the price of securities. In particular, a person will be treated as having an "interest" by virtue of the ownership or control of securities, or by virtue of any option in respect of, or derivative referenced to, securities. Terms in quotation marks are defined in the Code, which can also be found on the Panel's website. If you are in any doubt as to whether or not you are required to disclose a "dealing" under Rule 8, you should consult the Panel. NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION IN WHOLE OR IN PART IN, INTO OR FROM ANY JURISDICTION WHERE TO DO SO WOULD CONSTITUTE A VIOLATION OF THE RELEVANT LAWS OR REGULATIONS OF SUCH JURISDICTION
25 September 2007
CILP and the Board of telent announce a recommended cash offer for telent of 600p per telent Share (the “Offer”). The Offer values telent at approximately £398 million.
The Offer, which will be on and subject to the conditions and further terms set out in Appendix I and to be set out in the Offer Document, will be made on the following basis: for each telent Share 600p in cash The Offer represents a premium of approximately:
Under the terms of the Offer, telent Shareholders on the register as at 21 September 2007 will retain the right to receive on 17 October 2007 the final dividend of 11p per telent Share for the year ended 31 March 2007 announced on 16 May 2007. CILP has unconditionally agreed to acquire 16,500,000 telent Shares, representing (as at the date of this announcement) approximately 26.39 per cent. of the existing issued ordinary share capital of telent. Further, as at the close of business on 24 September 2007, being the last practicable business day prior to this announcement, CILP owned 1,869,372 telent Shares representing approximately 2.99 per cent. of the existing issued ordinary share capital of telent.
The Directors of telent, who have been so advised by Lazard, consider the terms of the Offer to be fair and reasonable. In providing advice to the Directors of telent, Lazard has taken into account the commercial assessments of the Directors of telent. Accordingly, the Directors of telent intend to recommend unanimously that telent Shareholders accept the Offer.
Those Directors of telent who own telent Shares, or have options over telent Shares, have irrevocably undertaken to accept the Offer in respect of their own telent Shares and in respect of those telent Shares which may be issued to them on the exercise of options. These irrevocable undertakings will remain binding in the event of a competing offer being made for telent and will cease to be binding only if the Offer lapses or is withdrawn. Further details of these irrevocable undertakings are set out in Appendix II to this announcement.
The Directors of telent believe the cash offer from CILP is the most compelling option available to telent Shareholders today. The Directors believe the offer price of 600p per telent Share is attractive, taking into account the future prospects of the operational business and the position of the UK Pension Plan. telent has been exploring targeted actions to manage pension liabilities and held discussions with a wide range of existing participants and potential entrants to the secondary buy-out market for pension fund assets and liabilities. From these discussions, the Directors of telent have concluded that there is no certainty that funds will be released from the Pension Escrow to telent in the short to medium term.
telent supplies a broad range of technology services to telecommunications operators and to enterprises, including those in the public sector. Operating in the UK and Germany, telent has in-depth knowledge of critical networks, an expert field force, and a reputation for providing high-quality customer service. For the year ended 31 March 2007, telent reported consolidated profit on ordinary activities from continuing operations before taxation of £40 million on turnover of £309 million and had net assets as at that date of £650 million. On 6 August 2007, telent published an Interim Management Statement, which covered trading for the first quarter of the 2008 financial year. Group revenues for the three months ended 30 June 2007 were down compared to the same period last year, but adjusted operating margins from trading activities (before share option costs, liability management and exceptional items) had improved year-on-year. Whilst telent has won a number of major new contracts in the UK enterprise sector in recent months, as at the end of August 2007, revenues remain at a lower level than the previous year and this has begun to put pressure on operating margins.
Pension Corporation is focused on providing responsible pension stewardship through tailored, sophisticated and affordable solutions for large pension scheme liabilities. Pension Corporation is the umbrella brand for its trading entities; Pension Corporation Investments, Pension Insurance Corporation and Pension Security Insurance Corporation. Pension Corporation has the financial capacity to manage more than £25 billion of pension scheme liabilities and has the largest dedicated capital backing of any focused pension solution provider in the UK today. The group’s investors include some of the world’s largest financial institutions, such as RBS, HBoS, Swiss Re, JC Flowers, Sampo Life, Union Banque Privée, ABN AMRO and Dubai-based Istithmar. Pension Corporation Investments LP Inc. (PCI), a Guernsey limited partnership whose general partner is Pension Corporation GP Limited, is focused on the sponsorship and management of pension schemes and related corporate assets in the UK. Pension Corporation Investments recently acquired control of the Thorn pension scheme (£1.2 billion assets) and related corporate assets, the largest ever pension scheme focused transaction in the UK. In addition, it manages the Thresher Group pension scheme. Pension Insurance Corporation Limited focuses on the provision of pension insurance to the UK market. It is authorised and regulated by the Financial Services Authority. Pension Security Insurance Corporation Limited provides re-insurance capability from Guernsey. It is authorised by the Guernsey Financial Services Commission.
CILP is a Guernsey limited partnership whose general partner is Pension Corporation GP Limited (“PCGP”), a Guernsey limited company which is authorised by the Guernsey Financial Services Commission. PCGP is advised by Pension Corporation.
On completion of the Offer, Pension Corporation intends that the current management team, led by Mark Plato, will remain to drive the technology services business forward. Pension Corporation believes that there is a benefit to telent’s operating business being allowed to develop away from the public markets and that the expertise and solutions which Pension Corporation can provide to telent’s pension schemes will allow telent’s management to focus exclusively on the operating business. Pension Corporation intends to work with telent’s management to develop and implement a strategy for telent’s operating business which it believes will best safeguard the long-term interests of the business, its employees and customers.
Pension Corporation has given assurances that the existing employment rights, including pension rights, of all of the management and employees of telent as required by applicable law and the relevant employment contracts will be safeguarded upon the Offer becoming or being declared unconditional in all respects.
The Offer will extend to any telent Shares unconditionally allotted or issued prior to the date on which the Offer closes (or such earlier date as CILP, subject to the Code, may decide) as a result of the exercise of options granted under any of the telent Share Schemes. It is intended that appropriate proposals will be made to holders of options granted under the telent Share Schemes, subject to the Offer becoming or being declared unconditional in all respects.
CILP intends to finance the consideration payable under the Offer by using a combination of committed equity funds from its investors and loan facilities. Merrill Lynch, financial adviser to CILP and Pension Corporation, has confirmed that it is satisfied that sufficient resources are available to CILP to enable it to satisfy in full the consideration payable by CILP as a result of full acceptance of the Offer.
CILP has unconditionally agreed to acquire 16,500,000 telent Shares, representing (as at the date of this announcement) approximately 26.39 per cent. of the existing issued ordinary share capital of telent. As at the close of business on 24 September 2007, being the last practicable business day prior to this announcement, CILP owned 1,869,372 telent Shares representing approximately 2.99 per cent. of the existing issued ordinary share capital of telent. As at the close of business on 21 September 2007, being the last practicable business day prior to this announcement, Merrill Lynch was the beneficial owner of 57,409 telent Shares representing approximately 0.09 per cent. of the existing issued ordinary share capital of telent. Except as described above and save for the irrevocable undertakings described in paragraph 4 above, as at the close of business on 24 September 2007, the latest practicable business day prior to the date of this announcement, neither CILP nor PCGP, nor any of the directors of PCGP, nor, so far as CILP is aware, any person acting in concert with CILP or PCGP (i) has any interest in or right to subscribe for any relevant securities of telent, nor (ii) has any short positions in respect of relevant securities of telent (whether conditional or absolute and whether in the money or otherwise), including any short position under a derivative, any agreement to sell or any delivery obligation or right to require another person to take delivery, nor (iii) has borrowed or lent any relevant telent securities (save for any borrowed shares which have been on-lent or sold), nor (iv) has any indemnity or option arrangement or any agreement or understanding, formal or informal, of whatever nature, relating to telent securities which may be an inducement to deal or restraint from dealing in such securities. In view of the requirement of confidentiality and therefore the availability to CILP of all relevant persons who are presumed to be acting in concert with CILP to provide information, it has not been possible to ascertain all of the interests and dealings in relevant securities of telent of all relevant persons who are presumed to be acting in concert with CILP for the purposes of the Offer. Any such additional interest(s) or dealing(s) will be discussed with the Panel and, as necessary, will be disclosed to telent Shareholders in the Offer Document or announced if requested by the Panel.
If CILP receives acceptances of the Offer in respect of, and/or otherwise acquires, 90 per cent. or more of the telent Shares to which the Offer relates and assuming all other Conditions of the Offer have been satisfied or waived (if they are capable of being waived), CILP intends to exercise its rights pursuant to the provisions of Part 28 of the Companies Act 2006 to acquire compulsorily the remaining telent Shares to which the Offer relates on the same terms as the Offer. Assuming the Offer becomes or is declared unconditional in all respects and sufficient acceptances under the Offer are received, CILP intends, subject to the requirements of the UK Listing Authority, to procure that telent makes applications to cancel the listing of telent Shares from the Official List and to cancel admission to trading in telent Shares on the London Stock Exchange's market for listed securities. Delisting and cancellation would significantly reduce the liquidity and marketability of any telent Shares not acquired under the Offer at that time. It is anticipated that the cancellation of listing on the Official List and of admission to trading on the London Stock Exchange will take effect no earlier than the expiry of 20 business days after either (i) the date on which CILP has, by virtue of its shareholdings and acceptances of the Offer, acquired or agreed to acquire issued ordinary share capital carrying 75 per cent. of the voting rights attaching to the telent Shares, or (ii) the first date of issue of compulsory acquisition notices under section 979 of the Companies Act 2006. CILP will notify telent Shareholders if and when the relevant event set out above has occurred and confirm that the notice period has commenced and the anticipated date of cancellation. Following the Offer becoming or being declared unconditional in all respects and after the cancellation of listing on the Official List and of admission to trading on the London Stock Exchange, telent may be re-registered as a private company under the relevant provisions of the Companies Act 1985.
The availability of the Offer to telent Shareholders who are not resident in the United Kingdom may be affected by the laws of their relevant jurisdiction. Such persons should inform themselves of, and observe, any applicable legal or regulatory requirements of their jurisdiction. Further details in relation to overseas shareholders will be contained in the Offer Document. telent Shareholders who are in any doubt regarding such matters should consult an appropriate independent professional adviser in the relevant jurisdiction without delay.
As a pre-condition to CILP agreeing to announce the Offer, telent has agreed to pay a fee to CILP of £3,977,925 (inclusive of VAT, if applicable, except to the extent that such VAT is recoverable by telent) if the Offer is not made, lapses or is withdrawn and: (a) the Directors of telent do not, in the Offer Document, make a unanimous unqualified recommendation to telent Shareholders to accept the Offer; (b) telent announces that the Directors of telent no longer intend to make the recommendation referred to in paragraph (a) or, once made, the Directors of telent withdraw, qualify or adversely modify such recommendation; or (c) a Competing Proposal (or any amendment, variation or revision of such proposal) is announced prior to the Offer lapsing or being withdrawn and such Competing Proposal becomes unconditional in all respects or is otherwise completed in accordance with its terms, or prior to the lapse or withdrawal of such Competing Proposal a subsequent Competing Proposal is announced which becomes unconditional in all respects or is otherwise completed in accordance with its terms; provided that neither paragraphs (a), (b) nor (c) shall give rise to any obligation on telent to pay the fee where the Offer not being made, lapsing or being withdrawn is caused by an act or omission of CILP. telent has also agreed not to enter into any inducement fee or arrangement having similar effect or any arrangement giving costs coverage to any person connected with a Competing Proposal. This restriction will not apply to an inducement fee agreed conditional upon the announcement of a Competing Proposal payable to the offeror in relation to such proposal where the offer so announced is at a price of at least 640p per telent Share.
The Offer Document will be posted to telent Shareholders as soon as practicable and, in any event, (save with the consent of the Panel) within 28 days. CILP reserves the right (with the consent of telent and the Panel) to elect to implement the acquisition of telent Shares by way of a scheme of arrangement as an alternative to the Offer. Any such scheme of arrangement will be implemented on the same terms (subject to appropriate amendments), so far as applicable, as those which would apply to the Offer and in compliance with applicable laws and regulations. The Offer will be subject to the Conditions and certain further terms set out in Appendix I to this announcement and the further terms and conditions to be set out in the Offer Document. In particular, it is a Condition of the Offer that no changes have been made to any relevant pension scheme including changes to the ongoing nature of the scheme, its governing documentation, investments, corporate trustee or the related Pension Escrow and security arrangements for the pension trustee. The bases and sources of certain information contained in this announcement are set out in Appendix III. Certain terms used in this announcement are defined in Appendix IV. The Offer and acceptances thereof will be governed by English law. The Offer will be subject to the applicable requirements of the Code, the Panel, the London Stock Exchange and the UK Listing Authority. In accordance with Rule 2.10 of the Code, telent confirms that as at 25 September 2007 it has 62,529,088 ordinary shares of 87.5p each in issue. The ISIN reference for these securities is GB00B0S5CP58. Enquiries:
Pension CorporationTelephone: +44 (0) 20 7451 6599 Charlotte Crosswell Merrill LynchTelephone: +44 (0) 20 7628 1000 Philip Noblet Noah Bulkin Michael Findlay (Corporate Broking)
Equus GroupTelephone: +44 (0) 20 7223 1100 Piers Hooper James Sumpster telentplcTelephone: +44 (0) 20 7005 6260 Monica Coull LazardTelephone: +44 (0) 20 7187 2000 Nicholas Jones Peter Warner Francois Barou JPMorgan CazenoveTelephone: +44 (0) 20 7588 2828 Andrew Hodgkin Threadneedle CommunicationsTelephone: +44 (0) 20 7936 9604 John Coles This announcement is not intended to and does not constitute, or form part of, an offer to sell or invitation to purchase or subscribe for any securities or the solicitation of any vote or approval in any jurisdiction pursuant to the Offer or otherwise, nor will there be any purchase or transfer of the securities referred to in this announcement in any jurisdiction in contravention of applicable law or regulation. The Offer will be made solely through the Offer Document and, in the case of certificated telent Shares, the Forms of Acceptance accompanying the Offer Document, which will contain the full terms and conditions of the Offer, including details of how to accept the Offer. Any acceptance or other response to the Offer should be made only on the basis of the information in such documents. Merrill Lynch, which is regulated in the UK by the Financial Services Authority, is acting exclusively for CILP and Pension Corporation and no one else in connection with the Offer and will not be responsible to anyone other than CILP and Pension Corporation for providing the protections afforded to customers of Merrill Lynch or for giving advice in relation to the Offer. Lazard and JPMorgan Cazenove, which are regulated in the UK by the Financial Services Authority, are acting exclusively for telent and no one else in connection with the Offer and will not be responsible to anyone other than telent for providing the protections afforded to the respective customers of Lazard or JPMorgan Cazenove nor for giving advice in relation to the Offer. The availability of the Offer to persons who are not resident in the UK may be affected by the laws of the relevant jurisdictions. Persons who are not so resident should inform themselves about, and observe, any applicable requirements. Further details in relation to overseas shareholders will be contained in the Offer Document. The release, publication or distribution of this announcement in jurisdictions other than the UK may be restricted by law and/or regulation and therefore any persons who are subject to the laws and regulations of any jurisdiction other than the UK should inform themselves about, and observe, any applicable requirements. Any failure to comply with the applicable requirements may constitute a violation of the laws and/or regulations of any such jurisdiction. This announcement has been prepared for the purpose of complying with English law and the Code and the information disclosed may not be the same as that which would have been disclosed if this announcement had been prepared in accordance with the laws and/or regulations of jurisdictions outside the UK. Any person (including, without limitation, any custodian, nominee and trustee) who would, or otherwise intends to, or who may have a contractual or legal obligation to, forward this announcement and/or the Offer Document and/or any other related document to any jurisdiction outside the UK should inform themselves of, and observe, any applicable legal or regulatory requirements of their jurisdiction. Notice to US investors This announcement does not constitute, or form part of, any offer for, or any solicitation of any offer for securities, nor is it a solicitation of any vote or approval in any jurisdiction, nor will there by any purchase or transfer of the securities referred to in this announcement in any jurisdiction in contravention of applicable law or regulation. The Offer is being made for securities of a UK company and United States investors should be aware that this announcement, the Offer Document and any other documents relating to the Offer have been or will be prepared in accordance with the Code and UK disclosure requirements, format and style, all of which differ from those in the United States. telent’s financial statements, and all financial information that is included in this announcement or that may be included in the Offer Document or any other documents relating to the Offer, have been or will be prepared in accordance with United Kingdom generally accepted accounting principles and International Financial Reporting Standards and thus may not be comparable to financial statements of United States companies. The Offer will be made in the United States pursuant to applicable US tender offer rules and otherwise in accordance with the requirements of the Code. Accordingly, the Offer will be subject to disclosure and other procedural requirements, including with respect to withdrawal rights, offer timetable, settlement procedures and timing of payments that are different from those applicable under US domestic tender offer procedures and law. The receipt of cash pursuant to the Offer by a United States holder of telent Shares may be a taxable transaction for United States federal income tax purposes and under applicable US state and local, as well as foreign and other tax laws. Each holder of telent Shares is urged to consult his independent professional adviser immediately regarding the tax consequences of acceptance of the Offer. telent is incorporated under the laws of England and Wales. All of the telent Directors are residents of countries other than the United States. As a result, it may not be possible for United States shareholders of telent to effect service of process within the United States upon telent or such telent Directors or to enforce against any of them judgements of the United States predicated upon the civil liability provisions of the federal securities laws of the United States. It may not be possible to sue telent or its officers or directors in a non-US court for violations of the US securities laws. In accordance with the Code and normal UK market practice and pursuant to class exemptive relief granted by the Staff of the Division of Market Regulation of the US Securities and Exchange Commission, CILP or its nominees or brokers (acting as agents) may from time to time during the period in which the Offer remains open for acceptance make certain purchases of, or arrangements to purchase, telent Shares otherwise than under the Offer, such as in open market or privately negotiated purchases. Such purchases, or arrangements to purchase, will comply with all applicable UK rules, including the Code and the rules of the London Stock Exchange. In addition, in accordance with the Code, normal UK market practice and Rule 14e-5(b) of the Exchange Act, Merrill Lynch will continue to act as exempt principal traders in telent securities on the London Stock Exchange. Information regarding such activities which is required to be made public in the United Kingdom pursuant to the Code will be reported to a Regulatory Information Service and will be available on the London Stock Exchange website at www.londonstockexchange.com. This information will also be publicly disclosed in the United States to the extent that such information is made public in the United Kingdom. Forward-looking statements This announcement may contain "forward-looking statements" concerning the Offer, CILP and telent. Generally, the words "will", "may", "should", "continue", "believes", "expects", "intends", "anticipates" or similar expressions identify forward-looking statements. The forward-looking statements involve risks and uncertainties that could cause actual results to differ materially from those expressed in the forward-looking statements. Many of these risks and uncertainties relate to factors that are beyond the companies' abilities to control or estimate precisely, such as future market conditions and the behaviours of other market participants, and therefore undue reliance should not be placed on such statements. CILP and telent assume no obligation and do not intend to update these forward-looking statements, except as required pursuant to applicable law and regulation. Dealing Disclosure Requirements Under the provisions of Rule 8.3 of the Code, if any person is, or becomes, "interested" (directly or indirectly) in 1 per cent. or more of any class of "relevant securities" of telent, all "dealings" in any "relevant securities" of telent (including by means of an option in respect of, or a derivative referenced to, any such "relevant securities") must be publicly disclosed by no later than 3.30 p.m. (London time) on the London business day following the date of the relevant transaction. This requirement will continue until the date on which the offer becomes, or is declared, unconditional as to acceptances, lapses or is otherwise withdrawn or on which the "offer period" otherwise ends. If two or more persons act together pursuant to an agreement or understanding, whether formal or informal, to acquire an "interest" in "relevant securities" of telent, they will be deemed to be a single person for the purpose of Rule 8.3. Under the provisions of Rule 8.1 of the Code, all "dealings" in "relevant securities" of telent by CILP or telent, or by any of their respective "associates", must be disclosed by no later than 12.00 noon (London time) on the London business day following the date of the relevant transaction. A disclosure table, giving details of the companies in whose "relevant securities" "dealings" should be disclosed, and the number of such securities in issue, can be found on the Takeover Panel's website at www.thetakeoverpanel.org.uk. "Interests in securities" arise, in summary, when a person has long economic exposure, whether conditional or absolute, to changes in the price of securities. In particular, a person will be treated as having an "interest" by virtue of the ownership or control of securities, or by virtue of any option in respect of, or derivative referenced to, securities. Terms in quotation marks are defined in the Code, which can also be found on the Panel's website. If you are in any doubt as to whether or not you are required to disclose a "dealing" under Rule 8, you should consult the Panel.
APPENDIX I
CONDITIONS AND CERTAIN FURTHER TERMS OF THE OFFER PART A: CONDITIONS OF THE OFFER The Offer will be conditional upon: (a) valid acceptances being received (and not, where permitted, withdrawn) by not later than 1.00 p.m. (London time) on the first closing date of the Offer (or such later time(s) and/or date(s) as CILP may, subject to the rules of the Code, decide) in respect of not less than 90 per cent. (or such lower percentage as CILP may decide) (i) in nominal value of the telent Shares to which the Offer relates; and (ii) of the voting rights attached to those shares, provided that this condition will not be satisfied unless CILP (together with its wholly-owned subsidiaries) shall have acquired or agreed to acquire (whether pursuant to the Offer or otherwise) telent Shares carrying in aggregate more than 50 per cent. of the voting rights normally exercisable at a general meeting of telent. For these purposes: (i) telent Shares which have been unconditionally allotted but not issued before the Offer becomes or is declared unconditional as to acceptances, whether pursuant to the exercise of any outstanding subscription or conversion rights or otherwise, shall be deemed to carry the voting rights they will carry upon issue; (ii) valid acceptances shall be deemed to have been received in respect of telent Shares which are treated for the purposes of section 979 of the Companies Act 2006 as having been acquired or contracted to be acquired by CILP by virtue of acceptances of the Offer; and (iii) the expression “telent Shares to which the offer relates” shall be construed in accordance with Part 28 of the Companies Act 2006; (b) no Third Party having intervened in any way or announced, instituted, implemented or threatened any action, proceeding, investigation, enquiry, suit or reference, or enacted, made or proposed any statute, regulation, decision or order which would or might reasonably be expected (in any case to an extent which is material in the context of the Wider CILP Group or the Wider telent Group, as the case may be, in each case, taken as a whole) to: (i) make the Offer or its implementation or the acquisition or proposed acquisition by CILP or any other member of the Wider CILP Group of any shares or other securities in, or control or management of, telent or any other member of the Wider telent Group, void, unenforceable and/or illegal in any jurisdiction or otherwise directly or indirectly restrain, restrict, prohibit, prevent, delay or otherwise interfere therewith or with the implementation thereof, or impose additional conditions or obligations with respect thereto, or require amendment to the terms of the Offer or the proposed acquisition of any shares or securities in telent, or the acquisition of control of telent by CILP; (ii) require, prevent, or delay the divestiture, or alter the terms of any proposed divestiture by CILP or any other member of the Wider CILP Group or by telent or any other member of the Wider telent Group of all or any part of their respective businesses, assets or properties or impose any limitation on the ability of any of them to conduct any of their respective businesses or to own or control any of their respective assets or properties or any material part thereof; (iii) limit or delay the ability of any member of the Wider CILP Group or any member of the Wider telent Group to acquire or to hold or to exercise effectively, directly or indirectly, all or any rights of ownership in respect of shares or loans or securities convertible into shares or other securities (or the equivalent) in, or to exercise voting or management control over, any member of the Wider CILP Group or any member of the Wider telent Group; (iv) require any member of the Wider CILP Group or of the Wider telent Group to acquire, or to offer to acquire, any shares or other securities (or the equivalent) in any member of either group owned by any third party (other than in the implementation of the Offer); (v) require, prevent or delay the divestiture or alter the terms envisaged for any proposed divestiture by any member of the Wider CILP Group of any shares or other securities (or the equivalent) in telent; (vi) limit the ability of any member of the Wider CILP Group or of the Wider telent Group to conduct or integrate or co-ordinate its business, or any part of it, with the businesses or any part of the businesses of any other member of the Wider CILP Group or of the Wider telent Group; (vii) result in any member of the Wider telent Group ceasing to be able to carry on business under any name under which it presently does so; or
and all applicable waiting and other time periods during which any Third Party could institute, implement or threaten any action, proceeding, investigation, enquiry, suit or reference or any other step under the laws of any relevant jurisdiction in respect of the Offer or the acquisition or proposed acquisition of any shares or other securities in, or control of, telent or any other member of the Wider telent Group by CILP or any other member of the Wider CILP Group, having expired, lapsed or terminated. (c) all necessary notifications and filings having been made, all applicable regulatory and statutory obligations in any relevant jurisdiction having been complied with, all appropriate waiting and other time periods (including any extensions of such waiting and other time periods) having expired, lapsed or been terminated, in each case in respect of the Offer or the acquisition or proposed acquisition of any shares or other securities in, or control of, telent or any other member of the Wider telent Group by CILP or any other member of the Wider CILP Group or the carrying on by any member of the Wider telent Group of its business except where the failure to make any such notification or filing, or comply with any such obligation, or the fact that any such period has not expired, lapsed or been terminated, individually or in the aggregate, would not be reasonably likely to have a materially adverse effect on the Wider CILP Group taken as a whole; (d) all authorisations and determinations necessary or reasonably considered to be appropriate by CILP in any relevant jurisdiction for or in respect of the Offer or the acquisition or proposed acquisition of any shares or other securities in, or control of, telent or any other member of the Wider telent Group by any member of the Wider CILP Group or in relation to the continuation of the business of any member of the Wider telent Group having been obtained, in terms and in a form reasonably satisfactory to CILP, from all relevant Third Parties or (without prejudice to the generality of the foregoing) from any persons or bodies with whom any member of the Wider telent Group has entered into contractual arrangements that are material in the context of the Wider telent Group taken as a whole (in each case, where the failure to obtain such authorisations and determinations is likely to have a materially adverse effect on the Wider telent Group taken as a whole) and such authorisations and determinations, together with all authorisations and determinations necessary or reasonably considered to be appropriate by CILP for any member of the Wider telent Group to carry on its business (where the absence of any such authorisations and determinations is likely to have a materially adverse effect on the Wider telent Group taken as a whole), remaining in full force and effect and there being no notice or intimation of any intention to revoke, suspend, restrict, modify or not renew any of the same in any such case in so far as is material in the context of the Wider CILP Group or the Wider telent Group, as the case may be, in each case, taken as a whole; (e) except as publicly announced by telent, or as fairly disclosed to Pension Corporation or CILP by or on behalf of telent in connection with the Offer, in each case prior to the date of this announcement, there being no provision of any agreement, arrangement, licence, permit, franchise or other instrument to which any member of the Wider telent Group is a party, or by or to which any such member or any of its assets is or are or may be bound, entitled or subject or any circumstance, which, in each case as a consequence of the Offer or the proposed acquisition of any shares or other securities in, or change in the control of or management of, telent or any other member of the Wider telent Group by any member of the Wider CILP Group or otherwise, would or might reasonably be expected to result in, (in any case to an extent that is or would be material in the context of the Wider telent Group taken as a whole): (i) any monies borrowed by, or any other indebtedness or liabilities (actual or contingent) of, or any grant available to, any such member being or becoming repayable or capable of being declared repayable immediately or prior to its stated maturity, or the ability of any such member to borrow monies or incur any indebtedness being withdrawn or inhibited or becoming capable of being withdrawn or inhibited; (ii) any such agreement, arrangement, licence, franchise or other instrument, or the rights, liabilities, obligations or interests of any member of the Wider telent Group thereunder, being, or becoming capable of being, terminated or adversely modified or affected or any onerous obligation or liability arising or any adverse action being taken or arising thereunder; (iii) the rights, liabilities, obligations or interests of any member of the Wider telent Group under any such agreement, arrangement, licence or instrument or the interests or business of any such member in or with any other person, firm, company or body (or any arrangement or arrangements relating to any such interests or business) being terminated or adversely modified or affected; (iv) any member of the Wider telent Group ceasing to be able to carry on its business under any name under which it presently does so; (v) any asset or interest of any member of the Wider telent Group being or failing to be disposed of or charged or ceasing to be available to any member of the Wider telent Group or any right arising under which any such asset or interest could be required to be disposed of or charged or could cease to be available to any member of the Wider telent Group; (vi) the creation or enforcement of any mortgage, charge or other security interest over the whole or any part of the business, property or assets of any member of the Wider telent Group or any such mortgage, charge or other security interest (whenever created, arising or having arisen) becoming enforceable; (vii) the creation of any liability (actual or contingent) by any member of the Wider telent Group; or (viii) the financial or trading position of any member of the Wider telent Group being prejudiced or adversely affected, and no event having occurred which, under any provision of any agreement, arrangement, licence, or other instrument to which any member of the Wider telent Group is a party or by or to which any such member or any of its assets may be bound, entitled or subject, could reasonably be expected to result in any of the events or circumstances as are referred to in sub-paragraphs (i) to (viii) of this Condition (e) to an extent which is material in the context of the Wider telent Group taken as a whole; (f) save as publicly announced by telent, or as fairly disclosed to CILP or Pension Corporation by or on behalf of telent in connection with the Offer in each case prior to the date of this announcement, no member of the Wider telent Group having, since 31 March 2007: (i) (save as between telent and any of its wholly-owned subsidiaries or between any of such wholly-owned subsidiaries or upon the exercise of rights to subscribe for telent Shares pursuant to the exercise of options granted under the telent Share Schemes) issued or agreed to issue or authorised or proposed the issue of additional shares or securities of any class, or of securities convertible into or exchangeable for, or rights, warrants or options to subscribe for or acquire, any such shares or convertible securities, or redeemed, purchased or repaid any of its own shares or other securities or reduced or authorised or made any other change to any part of its share capital or transferred or sold or agreed to transfer or sell any shares out of treasury; (ii) recommended, declared, paid or made or proposed to recommend, declare, pay or make any bonus, dividend or other distribution whether payable in cash or otherwise (other than to telent or a wholly-owned subsidiary of telent); (iii) save for transactions between telent and any of its wholly-owned subsidiaries or between any of such wholly-owned subsidiaries, acquired or disposed of or transferred, mortgaged or charged or created any security interest over any assets or any rights, title or interest in any asset (including shares and trade investments), which, in each case, is material in the context of the Wider telent Group taken as a whole, or merged with or demerged any body corporate or authorised or proposed or announced any intention to propose any such merger, demerger, acquisition, disposal, transfer, mortgage, charge or security interest (other than in the ordinary course of business); (iv) save for transactions between telent and any of its wholly-owned subsidiaries or between any of such wholly-owned subsidiaries, made or authorised or proposed or announced an intention to propose any change in its loan capital or issued, authorised or proposed the issue of any debentures which is material in the context of the Wider telent Group taken as a whole; (v) (save in the ordinary course of business or for transactions between telent and any of its wholly-owned subsidiaries or between any of such wholly-owned subsidiaries) incurred or increased any indebtedness or liability (actual or contingent) which is material in the context of the Wider telent Group taken as a whole; (vi) entered into or varied or authorised, proposed or announced its intention to enter into or vary any agreement, transaction, arrangement or commitment (whether in respect of capital expenditure or otherwise) which is of a long-term, onerous or unusual nature or magnitude or which involves or might reasonably be expected to involve an obligation of such a nature or magnitude, or restricts or would be restrictive on the business of any member of the Wider telent Group or the Wider CILP Group and in any case which is material in the context of the Wider telent Group taken as a whole; (vii) entered into or varied the terms of any contract, agreement or arrangement with any of the telent Directors or, to an extent that is material to the Wider telent Group taken as a whole, any other director or senior executive of any member of the Wider telent Group; (viii) waived or compromised any claim other than in the ordinary course of business in any case in a manner or on terms that are material in the context of the Wider telent Group taken as a whole; (ix) taken any corporate action or had any legal proceedings instituted or threatened against it or petition presented or order made, in each case for its winding-up (voluntary or otherwise), dissolution or reorganisation or for the appointment of a receiver, administrator, administrative receiver, trustee or similar officer of all or any part of its assets or revenues or any analogous proceedings in any jurisdiction or had any such person or analogous person appointed, in each case which is material in the context of the Wider telent Group taken as a whole; (x) been unable, or admitted in writing that it is unable, to pay its debts or having stopped or suspended (or threatened to stop or suspend) payment of its debts generally or ceased or threatened to cease carrying on all or a substantial part of its business; (xi) made any alteration to the memorandum or articles of association (or equivalent constitutional documents) of telent or any of telent's subsidiaries; (xii) purchased, redeemed or repaid or announced any proposal to purchase, redeem or repay any of its own shares or other securities or reduced or, save in respect to the matters mentioned in sub-paragraph (i) above, made any other change to any part of its share capital; (xiii) implemented, or authorised, proposed or announced its intention to implement, any reconstruction, amalgamation, scheme, commitment or other transaction or arrangement which is material in the context of the Offer or of the Wider telent Group taken as a whole;
(xvi) entered into any contract, commitment, agreement or arrangement or passed any resolution with respect to, or announced an intention to, or to propose to, effect any of the transactions, matters or events referred to in this Condition (f); (g) since 31 March 2007, and save as publicly announced by telent, or as fairly disclosed by or on behalf of telent to Pension Corporation or CILP in connection with the Offer in each case prior to the date of this announcement: (i) no adverse change or deterioration having occurred in the business, assets, financial or trading position or profits of telent or any other member of the Wider telent Group that is material in the context of the Wider telent Group taken as a whole; (ii) no litigation or arbitration proceedings, prosecution or other legal proceedings having been instituted, announced, implemented or threatened in writing by or against or remaining outstanding against or in respect of any member of the Wider telent Group or to which any member of the Wider telent Group is or may become a party (whether as plaintiff, defendant or otherwise) which in any such case might be reasonably expected adversely and materially to affect the Wider telent Group taken as a whole; (iii) (other than as a result of the Offer) no enquiry or investigation by, or complaint or reference to, any Third Party having been threatened in writing, announced, implemented or instituted by or against or remaining outstanding against or in respect of any member of the Wider telent Group which in any such case is material in the context of the Wider telent Group taken as a whole; (iv) no contingent or other liability of any member of the Wider telent Group having arisen or become apparent to CILP or increased which in any case is material in the context of the Wider telent Group taken as a whole; and (v) no steps having been taken which would be reasonably likely to result in the withdrawal, cancellation, termination or material modification of any licence held by any member of the Wider telent Group which is material in the context of the Wider telent Group taken as a whole. (h) save as publicly announced by telent, or fairly disclosed by or on behalf of telent to Pension Corporation or CILP in connection with the Offer prior to the date of this announcement, CILP not having discovered: (i) that any financial, business or other information concerning telent or the Wider telent Group that has been disclosed at any time by or on behalf of any member of the Wider telent Group whether publicly, or to any member of the Wider CILP Group, is misleading, contains any misrepresentation of fact or omits to state a fact necessary to make the information contained therein not misleading, in each case, to an extent which is material in the context of the Offer, and which was not corrected prior to the date of this announcement either publicly or otherwise fairly disclosed to Pension Corporation or CILP; or (ii) that any member of the Wider telent Group is subject to any liability (actual or contingent) that has not been publicly announced and which is material in the context of the Offer; or (iii) any information which affects the import of any information disclosed at any time by or on behalf of any member of the Wider telent Group and which is material in the context of the Wider telent Group taken as a whole; (i) CILP not having discovered that, save as publicly announced by telent or fairly disclosed to Pension Corporation or CILP by and on behalf of telent prior to the date of this announcement: (i) any past or present member of the Wider telent Group has not complied with any and/or all applicable legislation or regulations of any jurisdiction or authorisations with regard to the use, treatment, handling, storage, transport, release, disposal, discharge, carriage, spillage, leak or emission of any waste or hazardous substance or any substance likely to impair the environment or harm human health or animal health, or otherwise relating to environmental matters or the health and safety of any person, or that there has otherwise been any such use, treatment, handling, storage, transport, release, disposal, discharge, carriage, spillage, leak or emission (whether or not this constituted a non-compliance by any person with any legislation or regulations and wherever the same may have taken place) which, in any case, would be likely to give rise to any liability (whether actual or contingent) or cost on the part of any member of the Wider telent Group which in any case is material in the context of the Wider telent Group taken as a whole; (ii) there is, or is likely to be, any liability (whether actual or contingent) to make good, repair, reinstate or clean up any property or controlled waters now or previously owned, occupied or made use of, or controlled by or on behalf of any past or present member of the Wider telent Group, or in which any such member may now or previously have had or be deemed to have or have had an interest, or any other property or any controlled waters under any environmental legislation, regulation, notice, circular or order or other lawful requirement of any relevant authority or Third Party or otherwise which in any case is material in the context of the Wider telent Group taken as a whole; or (iii) that circumstances exist whereby a person or a class of person would be likely to have a claim in respect of any supply, product or process of manufacture or materials used therein now or previously manufactured, sold or carried our by any past or present member of the Wider telent Group which is or is reasonably likely to be material in the context of the Wider telent Group taken as a whole; (j) save as publicly announced by telent, or as fairly disclosed to CILP or Pension Corporation by or on behalf of telent in connection with the Offer in each case prior to the date of this announcement, since 31 March 2007: (i) no member of the telent Group having altered the nature or scope of its business in any way that is material in the context of the telent Group taken as a whole or the implementation of the Offer; (ii) no member of the telent Group having made any acquisitions or disposals outside the ordinary course of business consistent with past practice by any means (including, without limitation, by lease or licence), of any asset or assets with an aggregate value of £3,000,000 or more (based on lower of market and net book value); (iii) no transfers having been made by any means of any or all of the shares in any subsidiary of telent (other than intra-group transfers of the shares of any such subsidiary); (iv) no member of the telent Group having given any guarantee, indemnity or security, or entered into any agreement or arrangement having a similar effect or assumed, otherwise than by operation of law, any liability, whether actual or contingent, in respect of any obligation of any person, in each case, to an extent that is material in the context of the telent Group taken as a whole; (v) no member of the telent Group having entered into any agreement or binding commitment to do any of the actions described in sub-paragraphs (i) to (iv) above; or (k) save as publicly announced by telent, or as fairly disclosed to CILP or Pension Corporation by or on behalf of telent in connection with the Offer in each case prior to the date of this announcement, no member of the Wider telent Group nor the trustees of any relevant pension scheme having, since 31 March 2007, made or agreed or consented to any significant change to the terms of the trust deeds constituting the pension schemes established for the directors or employees (or their dependants) of any member of the Wider telent Group or the benefits which accrue, or to the pensions which are payable thereunder for all members or any category of members, or to the basis on which qualification for, or accrual or entitlement to, such benefits or pensions are calculated or determined for all members or any category of members or to the basis on which the liabilities (including pensions) of such pension schemes are funded or made, or agreed or consented to any change to the trustees including the appointment of a trust corporation, or made, or agreed or consented to, any change to the Pension Escrow or related security arrangements or proposed, or agreed or entered into, any significant change in the manner in which the assets of any such pension scheme or the Pension Escrow are invested or taken any corporate action or authorised, proposed or announced its intention to wind-up any such pension scheme or to enter into one or more specific bulk annuity contracts in relation to any such pension scheme or there being made any change to the manner of appointment of the directors of any corporate trustee of any relevant pension scheme; and (l) no event or circumstance shall have occurred or arisen that could reasonably be expected to result in the clearance statement issued by the Pensions Regulator on 21 October 2005 in relation to the UK Pension Plan in respect of any member of the Wider telent Group and/or any persons who are or may become their respective associates or connected persons (as defined in sections 249 and 435 of the Insolvency Act 1986) being varied, amended, revoked, ceasing to bind the Pensions Regulator or otherwise ceasing to remain in full force and effect and the Pensions Regulator shall not have taken any action that would or might reasonably be expected to have a similar effect, in each case where such circumstance would or might reasonably be expected to have a materially adverse effect on the Wider telent Group. For the purposes of these Conditions: (a) “Third Party” means any government, government department or governmental, quasi-governmental, supranational, statutory, regulatory or investigative body, authority (including any national anti-trust or merger control authority), court, trade agency, association, institution or professional or environmental body or any other person or body whatsoever in any relevant jurisdiction; (b) a Third Party shall be regarded as having “intervened” if it has decided to take, institute, implement, or threaten any action, proceeding, suit, investigation or enquiry or reference, or made, enacted or proposed any statute, regulation, decision or order, or taken any measures or other steps or required any action to be taken or information to be provided or otherwise having done anything and “intervene” shall be construed accordingly; (c) “authorisations” means authorisations, orders, grants, recognitions, confirmations, consents, licences, clearances, permissions, exemptions and approvals; (d) “publicly announced” means disclosed in (i) the annual report and accounts of telent for the year ended 31 March 2007, or (ii) otherwise announced on or before the date of this announcement by telent by the delivery of an announcement to a Regulatory Information Service; (e) “Wider telent Group” means telent and its subsidiary undertakings, associated undertakings and any other undertakings in which telent and such undertakings (aggregating their interests) have a substantial interest, the “telent Group” means telent and its subsidiaries, subsidiary undertakings and holding companies and the subsidiaries and subsidiary undertakings of any such holding company and “Wider CILP Group” means CILP and its subsidiary undertakings, associated undertakings and any other undertaking in which CILP and such undertakings (aggregating their interests) have a substantial interest and, for these purposes, “subsidiary undertaking”, “associated undertaking” and “undertaking” have the meanings given by the Companies Act 1985 (but for this purpose ignoring paragraph 20(1)(b) of Schedule 4A to the Companies Act 1985) and “substantial interest” means a direct or indirect interest in 20 per cent. or more of the equity capital of an undertaking; and (f) “Encumbrance” means any charge, mortgage, lien, hypothecation, judgment, encumbrance, easement, security, title retention, preferential right, trust arrangement, or any other security interest or any other agreement or arrangement having a commercial effect analogous to the conferring of security or similar right in favour of any person.
PART B: CERTAIN FURTHER TERMS OF THE OFFER CILP reserves the right to waive in whole, or in part, all or any of the Conditions except Condition (a). Conditions (b) to (l) (inclusive) must be fulfilled, be determined by CILP to be or remain satisfied or (if capable of waiver) be waived, by midnight on the 21st day after the later of the first closing date of the Offer and the date on which Condition (a) is fulfilled (or in each case such later date as CILP may, with the consent of the Panel, decide), failing which the Offer will lapse. CILP shall be under no obligation to waive (if capable of waiver), to determine to be or remain satisfied or to treat as fulfilled any of conditions (b) to (l) (inclusive) by a date earlier than the latest date specified above for the fulfilment of that condition, notwithstanding that the other conditions of the Offer may at such earlier date have been waived or fulfilled and that there are, at such earlier date, no circumstances indicating that any condition may not be capable of fulfilment. Save with the consent of the Panel, the Offer will lapse if it is referred to the Competition Commission or is the subject of a decision to initiate proceedings under Article 6(1)(c) of Council Regulation 139/2004/EC before 1.00 p.m. (London time) on the first closing date of the Offer or the date on which the Offer becomes or is declared unconditional as to acceptances, whichever is the later. If the Offer lapses it will cease to be capable of further acceptance. telent Shareholders who have accepted the Offer and CILP shall then cease to be bound by acceptances delivered on or before the date on which the Offer lapses. The telent Shares will be acquired by CILP fully paid and free from all liens, equitable interests, charges, encumbrances, rights of pre-emption and any other third party rights or interests whatsoever and together with all rights existing as at the date of this announcement or thereafter attaching thereto, including the right to receive and retain in full all dividends and other distributions (if any) declared, made or paid or any other return of capital (whether by way of reduction of share capital or share premium account or otherwise) made on or after the date of this announcement, save for the final dividend of 11.0p per share for the year ended 31 March 2007 announced on 16 May 2007. If CILP is required by the Panel to make an offer for telent Shares under the provisions of Rule 9 of the Code, CILP may make such alterations to the terms and conditions of the offer as are necessary to comply with the provisions of that rule. The Offer will be made on, and subject to, the Conditions and terms set out in this Appendix I and on such further terms as will be set out in the Offer Document. The Offer will be governed by English law and will be subject to the jurisdiction of the courts of England. The Offer will comply with the applicable rules and regulations of the UK Listing Authority, the London Stock Exchange and the CodeAPPENDIX II
The following Directors of telent have given irrevocable undertakings as described in paragraph 4 of this announcement in respect of the number of telent Shares and options over telent Shares set out below (and any further telent Shares (if any) acquired by them prior to the completion of the Offer, save for any further telent Shares (if any) issued upon the exercise of options over telent Shares under an Inland Revenue approved option scheme):
APPENDIX III
SOURCES AND BASES OF CALCULATION General Unless otherwise stated, financial information relating to telent has been extracted from the relevant published audited Annual Report and Accounts of telent and/or the published interim results of telent and/or other public statements made by telent. Value of Offer telent is valued by the Offer at £398 million, based on the offer price for each telent Share and on 62,529,088 telent Shares being in issue and on 3,769,662 telent Shares capable of being issued to satisfy existing options under the telent Share Schemes (as provided by telent). Share prices The prices of telent Shares on a particular date and the performance of telent Shares relative to market indices are derived from Thomson Factset. APPENDIX IV
DEFINITIONS
All references to time in this announcement are to London time unless otherwise stated.
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