Recommended Cash Offer for Independent News & Media PLC by Mediahuis NV

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 THAT JURISDICTION

THIS ANNOUNCEMENT IS BEING MADE PURSUANT TO RULE 2.5 OF THE IRISH TAKEOVER RULES

THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION

FOR IMMEDIATE RELEASE

30 APRIL 2019

RECOMMENDED CASH OFFER
for
INDEPENDENT NEWS & MEDIA PLC
by
MEDIAHUIS NV

TO BE IMPLEMENTED BY WAY OF A SCHEME OF ARRANGEMENT UNDER CHAPTER 1 OF PART 9 OF THE COMPANIES ACT 2014

Summary

• Mediahuis NV (“Mediahuis”) and Independent News & Media PLC (“INM”) are pleased to announce that they have reached agreement on the terms of a cash offer by Mediahuis, unanimously recommended by the Board of INM, pursuant to which Mediahuis will acquire the entire issued and to be issued share capital of INM.

• Under the terms of the Acquisition, INM Shareholders will be entitled to receive:
for each INM Ordinary Share 10.5 cent in cash

• The Acquisition values the entire issued and to be issued ordinary share capital of INM at approximately €145.6 million.

• The Acquisition represents a premium of approximately:
o 44% to INM’s Closing Price of 7.28 cent on 3 April 2019 (being the last Business Day prior to the Rule 2.4 Announcement by INM on 4 April 2019);
o 63% to INM’s volume weighted average share price of approximately 6.43 cent over the 30 trading day period ending on 3 April 2019; and
o 70% to INM’s volume weighted average share price of approximately 6.17 cent over the 90 trading day period ending on 3 April 2019.

• Commenting on the Acquisition, Gert Ysebaert, CEO of Mediahuis, said:
“As a private European media group with a strong portfolio of news media and digital brands, Mediahuis is optimally positioned to facilitate the continued development of INM as a leading Irish media company. We believe that there is a clear rationale for the acquisition and that INM will thrive under Mediahuis’ ownership. Furthermore, Mediahuis can contribute the relevant experience, skills and resources to invest in INM’s brands and significantly enhance its operational and digital capabilities. Underpinned by our unreserved belief in independent and quality journalism, we are optimistic about the combination of Mediahuis and INM and its potential contribution to the Irish media landscape.”

• Commenting on the Acquisition, Murdoch MacLennan, Chairman of INM said:
“We are pleased to be announcing this transaction today and believe it represents an excellent outcome for both the company and its shareholders. The offer from Mediahuis represents a compelling opportunity for shareholders to realise cash for their shareholding in INM, at a price which fairly reflects the company’s performance and standalone prospects. INM has a proud and illustrious history stretching back to the start of the twentieth century and the INM Board believes that this offer from Mediahuis, if approved, will herald an exciting new chapter for our employees, readership and customers. Mediahuis already has a strong track record in newspaper and digital media development in Europe, which we feel will provide INM with the best opportunity to achieve its strategic objectives, while continuing to enable it to deliver journalism of the highest quality to the island of Ireland and our readers abroad.”

• It is intended that the Acquisition will be implemented by means of a High Court sanctioned scheme of arrangement under Chapter 1 of Part 9 of the Act (or, if Mediahuis elects, subject to the terms of the Transaction Agreement and with the consent of the Panel, a Takeover Offer).

• The posting of the Scheme Document (or making of the Takeover Offer, if applicable) is subject to the satisfaction (or waiver by Mediahuis) of the Pre-Conditions set out in Appendix IV, being:
o the receipt by Mediahuis of an irrevocable undertaking to vote in favour of each of the Resolutions required to implement the Acquisition in respect of 414,322,191 INM Ordinary Shares from Denis O’Brien not later than 5:00 pm (Irish time) today; and
o the receipt by Mediahuis of an irrevocable undertaking to vote in favour of each of the Resolutions required to implement the Acquisition in respect of 207,982,106 INM Ordinary Shares from Dermot Desmond not later than 5:00 pm (Irish time) today.

• If the Pre-Conditions are satisfied, and together with the irrevocable undertakings given by INM’s Directors, Mediahuis will have received irrevocable undertakings to vote in favour of each of the Resolutions required to implement the Acquisition in respect of approximately 44.90% of the issued share capital (excluding treasury shares) of INM.

• In addition, completion of the Acquisition is conditional on, among other things, (i) the approval by INM Shareholders of the Scheme Meeting Resolution and the EGM Resolutions; (ii) the sanction of the Scheme and the confirmation of the Reduction of Capital, by the High Court; and (iii) receipt of required regulatory and other necessary approvals.

• Having taken into account the relevant factors and applicable risks, the INM Board, which has been so advised by Lazard, as financial adviser to INM, considers the terms of the Acquisition as set out in this Announcement to be fair and reasonable. In providing its advice to the INM Board, Lazard has taken into account the commercial assessments of the INM Directors. Accordingly the INM Board unanimously recommends that INM Shareholders vote in favour of the Acquisition and all of the Resolutions, as they intend to do in respect of their own beneficial holdings of, in aggregate, 288,841 INM Ordinary Shares.

• Subject to the satisfaction (or waiver by Mediahuis) of the Pre-Conditions set out in Appendix IV of this Announcement, the Scheme Document, which will contain, amongst other things, further information about the Acquisition, notices convening the Scheme Meeting and the Extraordinary General Meeting, the expected timetable for Completion and action to be taken by INM Shareholders, will be published as soon as practicable and, in any event, (save with the consent of the Panel) within 28 days of this Announcement. It is anticipated that the Scheme will, subject to obtaining the necessary regulatory approvals, be declared effective in the third quarter of 2019.

About Mediahuis NV

Mediahuis is a private European media group with a strong portfolio of news media and digital brands. Mediahuis was founded in 2013 through the combination of the media assets of two long established Belgian publishers, Mediahuis Partners (formerly Corelio) and Concentra. Since 2013, Mediahuis has grown rapidly through acquisitions to become a leading media player in both Belgium and the Netherlands. It currently employs more than 3,200 people, delivering a turnover of €819 million in 2018. As a publisher, Mediahuis believes unreservedly in independent and quality journalism, as well as in strong and relevant media that makes a positive contribution to people and society. Mediahuis’ offices are located in Antwerp (BE), Brussels (BE), Hasselt (BE), Amsterdam (NL), and Sittard (NL).

In the Netherlands, the group operates, amongst others the news brands De Telegraaf, NRC Handelsblad, NRC Next, De Limburger and Noordhollands Dagblad, and achieves sales of almost 900,000 newspapers daily. With news brands such as De Standaard, Het Nieuwsblad, Gazet van Antwerpen and Het Belang van Limburg, Mediahuis sells approximately 500,000 newspapers in Belgium daily.

Mediahuis has, in recent years, made significant progress in terms of the digital transformation of its news brands. The Mediahuis Group is committed to accelerating the digitalisation of its news brands without compromising the print editions of its strong portfolio of news titles. Mediahuis successfully implements pay walls and digital subscription services across its news sites and remains focussed on optimising customer experience through innovative journalism, which results in continued growth in digital subscriptions and enhanced reader relationships.

Mediahuis also operates several significant classifieds platforms in Belgium and the Netherlands, such as Jobat, Jellow, Zimmo, Vroom, Gaspedaal and GroupDeal. The Group is active in the Belgian radio market through the recently launched radio station NRJ and the Nostalgie radio station, which reaches 430,000 listeners in Flanders daily and is the market leader in the French-speaking part of Belgium. Mediahuis also operates a series of regional TV channels.

About INM plc

INM is a leading newspaper and online publisher on the island of Ireland, as well as being the largest wholesale distributor of newspapers and magazines. Headquartered in Dublin, Ireland, INM employs approximately 800 people and achieved revenues of €191 million in the 2018 financial year.

INM publishes a number of widely-recognised titles, including the Irish Independent, Sunday Independent, The Herald, Sunday World, Belfast Telegraph, Sunday Life and The Star. It also publishes twelve weekly regional newspapers, which include the Drogheda Independent, Wexford People, The Kerryman and The Sligo Champion. INM also has an online presence, led by independent.ie and belfasttelegraph.co.uk, which complements its national and regional newspaper titles. INM’s titles sell over 1 million copies per week and reach 2.1 million readers per week across print and online.

In addition, INM has expanded its offering to include a number of classified websites, featuring job, property and motor among its categories.

This summary should be read in conjunction with the full text of the following Announcement and its appendices.

The Pre-Conditions to the posting of the Scheme Document (or the making of the Takeover Offer, if applicable) are set out in Appendix IV of this Announcement. The Conditions to, and certain further terms of, the Acquisition are set out in Appendix III to this Announcement and the Acquisition is subject to further terms to be set out in the Scheme Document.

Appendix I to this Announcement contains certain sources of information and bases of calculation contained in this Announcement. Certain terms used in this Announcement are defined in Appendix II to this Announcement.

This Announcement contains inside information and has been issued pursuant to Article 2.1(b) of Commission Implementing Regulation (EU) 2016/1055. The date and time of this Announcement is the same as the date and time that it has been communicated to the media.

Enquiries:

INM
Michael Doorly (CEO) +353 1 466 3200
Lazard (Financial Adviser to INM)
Nicholas Shott / Philippe Noël +44 207 187 2000
Davy (Corporate Broker to INM)
Ivan Murphy / Barry Murphy +353 1 679 6363
Wilson Hartnell (Public Relations Adviser to INM)
Brian Bell +353 87 2436 130
Mediahuis
An Steylemans (Head of Mediahuis Group Communication) +32 473 55 71 48
J.P. Morgan (Financial Adviser to Mediahuis)
Dwayne Lysaght / Gian Piero Sammartano / Alec Pratt +44 20 7742 4000
Drury Porter Novelli (Public Relations Adviser to Mediahuis)
+353 1 260 5000

Billy Murphy
+353 87 231 3085
Cathal Barry
+353 87 227 9281

Statements required by the Takeover Rules

The Mediahuis Directors accept responsibility for the information contained in this Announcement other than that relating to INM, the INM Group and the INM Directors and members of their immediate families, related trusts and persons connected with them. To the best of the knowledge and belief of the Mediahuis Directors (who have taken all reasonable care to ensure that such is the case), the information contained in this Announcement for which they accept responsibility is in accordance with the facts and does not omit anything likely to affect the import of such information.

The INM Directors accept responsibility for the information contained in this Announcement relating to INM, the INM Group and the INM Directors and members of their immediate families, related trusts and persons connected with them. To the best of the knowledge and belief of the INM Directors (who have taken all reasonable care to ensure such is the case), the information contained in this Announcement for which they accept responsibility is in accordance with the facts and does not omit anything likely to affect the import of such information.

J.P. Morgan Securities plc, which is authorised in the United Kingdom by the Prudential Regulation Authority and regulated by the Prudential Regulation Authority and the Financial Conduct Authority, is acting as financial adviser exclusively for Mediahuis and no one else in connection with the Acquisition and will not regard any other person as its client in relation to the Acquisition and will not be responsible to anyone other than Mediahuis for providing the protections afforded to clients of J.P. Morgan or its affiliates, nor for providing advice in relation to the Acquisition or any other matters referred to herein.

Lazard & Co., Limited, which is authorised and regulated by the FCA, is acting as financial adviser to INM and no one else in connection with the Acquisition and will not be responsible to anyone other than INM for providing the protections afforded to clients of Lazard & Co., Limited nor for providing advice in connection with the Acquisition or the other matters referred to herein. Neither Lazard & Co., Limited nor any of its affiliates owes or accepts any duty, liability or responsibility whatsoever (whether direct or indirect, whether in contract, in tort, under statute or otherwise) to any person who is not a client of Lazard & Co., Limited in connection with the Acquisition, this Announcement, any statement contained herein or otherwise.

Davy, which is authorised and regulated by the Central Bank of Ireland, is acting exclusively for INM and no one else in connection with the matters referred to in this Announcement and will not be responsible to anyone other than INM for providing the protections afforded to clients of Davy, or for providing advice in connection with the matters referred to in this Announcement.

Arthur Cox are acting as legal advisers to Mediahuis and Matheson are acting as legal advisers to INM.
This Announcement is for information purposes only and is not intended to, and does not, constitute or form any part of any offer or invitation, or the solicitation of an offer, to purchase or otherwise acquire, subscribe for, sell or otherwise dispose of any securities or the solicitation of any vote or approval in any jurisdiction pursuant to the Acquisition or otherwise, nor shall there be any sale, issuance or transfer of securities in any jurisdiction in contravention of applicable law. The Acquisition will be made solely by means of the Scheme Document (or, if applicable, the Takeover Offer Document), which will contain the full terms and conditions of the Acquisition, including details of how to vote in respect of the Acquisition. Any decision in respect of, or other response to, the Acquisition, should be made only on the basis of the information contained in the Scheme Document (or, if applicable, the Takeover Offer Document).

This Announcement does not constitute a prospectus or a prospectus equivalent document.

This Announcement has been prepared for the purpose of complying with the laws of Ireland and the Takeover Rules 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 of jurisdictions outside of Ireland.

Cautionary Statement Regarding Forward-Looking Statements

This Announcement contains certain forward-looking statements with respect to Mediahuis and INM. These forward-looking statements can be identified by the fact that they do not relate only to historical or current facts. Forward-looking statements often use words such as “anticipate”, “target”, “expect”, “estimate”, “intend”, “plan”, “believe”, “will”, “may”, “would”, “could” or “should” or other words of similar meaning or the negative thereof. Forward-looking statements include statements relating to the following: (i) future capital expenditures, expenses, revenues, economic performance, financial conditions, dividend policy, losses and future prospects; (ii) business and management strategies and the expansion and growth of the operations of the Mediahuis Group or the INM Group; and (iii) the effects of government regulation on the business of the Mediahuis Group or the INM Group.

These forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of any such person, or industry results, to be materially different from any results, performance or achievements expressed or implied by such forward-looking statements. These forward-looking statements are based on numerous assumptions regarding the present and future business strategies of such persons and the environment in which each will operate in the future. You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof. All subsequent oral or written forward-looking statements attributable to Mediahuis or INM or any persons acting on their behalf are expressly qualified in their entirety by the cautionary statement above. Neither Mediahuis nor INM undertake any obligation to update publicly or revise forward-looking or other statements contained in this Announcement, whether as a result of new information, future events or otherwise, except to the extent legally required.

Disclosure requirements of the Takeover Rules

Under the provisions of Rule 8.3 of the Takeover Rules, if any person is, or becomes, “interested” (directly or indirectly) in, 1% or more of any class of “relevant securities” of INM, all “dealings” in any “relevant securities” of INM (including by means of an option in respect of, or a derivative referenced to, any such “relevant securities”) must be publicly disclosed by not later than 3:30 pm (Irish time) on the “business day” in Dublin following the date of the relevant transaction. This requirement will continue until the date on which the “offer period” ends. If two or more persons co-operate on the basis of any agreement, either express or tacit, either oral or written, to acquire an “interest” in “relevant securities” of INM, they will be deemed to be a single person for the purpose of Rule 8.3 of the Takeover Rules.

Under the provisions of Rule 8.1 of the Takeover Rules, all “dealings” in “relevant securities” of INM by Mediahuis, or by any party Acting in Concert with Mediahuis, must also be disclosed by no later than 12 noon (Irish time) on the business day in Dublin following the date of the relevant transaction.
A disclosure table, giving details of the companies in whose “relevant securities” “dealings” should be disclosed, can be found on the Irish Takeover Panel’s website at www.irishtakeoverpanel.ie.

“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 Takeover Rules, which can also be found on the Irish Takeover Panel’s website. If you are in any doubt as to whether or not you are required to disclose a dealing under Rule 8, please consult the Irish Takeover Panel’s website at www.irishtakeoverpanel.ie or contact the Irish Takeover Panel on telephone number +353 1 678 9020.

No profit forecasts, estimates or asset valuations

No statement in this Announcement is intended as a profit forecast or estimate for any period and no statement in this Announcement should be interpreted to mean that earnings or earnings per share, for Mediahuis or INM, respectively for the current or future financial years would necessarily match or exceed the historical published earnings or earnings per share for Mediahuis or INM, respectively. No statement in this Announcement constitutes an asset valuation.

Right to switch to a Takeover Offer

Mediahuis reserves the right to elect, subject to the terms of the Transaction Agreement and with the consent of the Panel, to implement the Acquisition by way of a Takeover Offer for the entire issued and to be issued share capital of INM as an alternative to the Scheme. In such an event, the Takeover Offer will be implemented on the same terms (subject to appropriate amendments), so far as applicable, as those which would apply to the Scheme and subject to the amendments referred to in Appendix III to this Announcement and in the Transaction Agreement.

Publication on website

Pursuant to Rule 2.6(c) of the Takeover Rules, this Announcement will be made available to Mediahuis’ employees on Mediahuis’ website (www.mediahuis.be) and INM’s employees on INM’s website (www.inmplc.com).

Neither the content of any such website nor the content of any other website accessible from hyperlinks on such website is incorporated into, or forms part of, this Announcement.
Rounding

Certain figures included in this Announcement have been subjected to rounding adjustments. Accordingly, figures shown for the same category presented in different tables may vary slightly and figures shown as totals in certain tables may not be an arithmetic aggregation of the figures that precede them.

General

The laws of the relevant jurisdictions may affect the availability of the Acquisition to persons who are not resident in Ireland or the United Kingdom. Persons who are not resident in Ireland or the United Kingdom, or who are subject to laws of any jurisdiction other than Ireland or the United Kingdom, should inform themselves about, and observe, any applicable legal or regulatory requirements. Any failure to comply with the applicable legal or regulatory requirements may constitute a violation of the laws and/or regulations of any such jurisdiction. To the fullest extent permitted by applicable law, the companies and persons involved in the Acquisition disclaim any responsibility and liability for the violation of such restrictions by any person.

The Acquisition will not be made available, directly or indirectly, in a Restricted Jurisdiction, and the Acquisition will not be capable of acceptance from within a Restricted Jurisdiction.

The release, publication or distribution of this Announcement in or into certain jurisdictions may be restricted by the laws of those jurisdictions. Accordingly, copies of this Announcement and all other documents relating to the Acquisition are not being, and must not be, released, published, mailed or otherwise forwarded, distributed or sent in, into or from any Restricted Jurisdiction. Persons receiving such documents (including, without limitation, nominees, trustees and custodians) should observe these restrictions. Failure to do so may constitute a violation of the securities laws of any such jurisdiction. To the fullest extent permitted by applicable law, Mediahuis and INM disclaim any responsibility or liability for the violations of any such restrictions by any person.

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