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Re: [sharechat] Prospective DAD / BCH merger


From: daniel <zxcvbnm@homestead.com>
Date: Tue, 07 Aug 2001 14:02:50 +1200


BCH
   07/08/2001
   MERGE

   REL: 1249 HRS Baycorp Holdings Limited

   MERGE: BCH: AUD1.5 BILLION MERGER WITH DATA ADVANTAGE

   Baycorp Holdings Limited and Data Advantage Limited advised they
reached
   agreement today on their AUD1.5 billion (NZD1.9 billion) merger to
form a
   pre-eminent regional business solutions company.

   After extensive negotiations, the two parties have settled on merger
terms
   that will see Data Advantage offer 1.56 shares for every one Baycorp
share.
   In addition both companies will pay out a final and a special
dividend to
   shareholders totalling NZD33.5 cents per share (NZD 13.5 cents final,
NZD 20
   cents special) fully imputed for Baycorp and AUD14 cents per share
(AUD 6
   cents final, AUD 8 cents special) fully franked for Data Advantage.

   Baycorp shareholders will have a 58 per cent interest in the merged
group
   (following the cancellation of Baycorp's 9.3 per cent interest in
Data
   Advantage, which is currently intended to be part of the merger
process) and
   Data Advantage shareholders will have a 42 per cent interest.

   The merged company will be called Baycorp Advantage and will be
headquartered
   in Sydney.

   In a joint statement, Baycorp Chairman, Mrs. Rosanne Meo, and Data
Advantage
   Chairman, Mr. Brian Gatfield, said: " We are delighted to have
reached
   agreement. From the outset, it was clear to us that merging our two
companies
   made compelling sense. This merger is unanimously recommended by the
Boards
   of Baycorp and Data Advantage.

   "While these discussions may have been somewhat protracted, we have
always
   remained 100 per cent committed to completing this union. Indeed the
shared
   excitement in relation to the prospects of the merger has been a
strong and
   consistent theme for both parties and the board and management look
forward
   to fulfilling this potential.

   "Essentially, we are bringing together two companies which are highly

   successful in their respective markets and creating a single, focused
and
   powerful regional player.

   "We realise that our business is increasingly global in its
direction. In
   recognising that trend, the first step is to create a strong position
in
   Australasia through our ability to offer a comprehensive product
suite to our
   customers on both sides of the Tasman. From this platform, we will
develop a
   substantial presence in the Asia Pacific region and beyond.

   "The merger is in the best interests of shareholders, staff and
customers of
   Baycorp and Data Advantage.

   "From a shareholder perspective, the terms of the merger are
eminently
   sensible and we expect the transaction to be cash EPS (pre goodwill)
positive
   for all shareholders."

   The merger is expected to be implemented by the end of the year. It
is
   subject to shareholder approvals of Baycorp and Data Advantage, along
with
   other regulatory consents or waivers in Australia and New Zealand,
the
   finalisation of the commercial arrangements with international and
regional
   business partners, and conditions typical of transactions of this
nature.

   Mrs. Meo will assume the position of Chairman of Baycorp Advantage,
   overseeing the crucial integration phase. Mr Gatfield will be the
deputy
   chairman.

   Heading the merged group will be Baycorp Managing Director, Mr. Keith

   McLaughlin. As Managing Director of Baycorp Advantage, he will be
responsible
   for extracting the significant synergy benefits of merging the two
companies
   as well as overseeing the implementation of a long-term growth
strategy for
   the company.

   The Data Advantage Chief Executive, Mr. David Grafton, will be
executive
   director of Baycorp Advantage. He will also play an important role in

   harnessing the potential of the merged company, particularly in the
areas of
   new value added services and international expansion.

   The two Chairmen said: "We are particularly pleased to have both
Keith and
   David working together to realise the significant potential of
Baycorp
   Advantage. Keith is a respected and leading New Zealand businessman
with a
   track record of driving shareholder value.  David has considerable
   international experience and expertise in developing new
opportunities in the
   business solutions area."

   Mrs. Meo said that a key element of the merger was the significant
synergy
   benefits that would be generated.

   "These are certainly very persuasive. We estimate synergy benefits to
be in
   excess of AUD15 million (NZD19 million) per annum within three years.
To put
   that into context, it is equivalent to around 30 per cent of the
current
   combined EBIT of both companies.

   "The synergies will come from our ability to cross sell products into
each
   other's markets, economies of scale and scope, and from both
companies having
   a concerted approach to growing our operations in Asia and further
afield."

   Mr McLaughlin said that the identified synergy gains from combining
these two
   companies into one united and focused group were achievable.

   "The fact that this is an agreed merger and not a hostile takeover
situation
   means we are able to maximise these synergy gains," he said.

   Mr McLaughlin also noted the benefits of being based out of
Australia.
   "Around 60 per cent of our combined shareholders are located in
Australia.
   Further, Sydney, as a financial hub for the region, is also a logical
place
   to be based, given our aspirations in Asia Pacific.

   "Although we will be headquartered in Sydney, New Zealand still
remains a key
   market for us, especially in terms of growth potential. We will
retain a
   substantial operational office there."

   Mr Grafton added: "With an estimated market capitalisation of
approximately
   AUD1.5 billion (NZD1.9 billion), Baycorp Advantage will have the
increased
   scale and financial flexibility to tackle international markets.

   "The larger size will also give us the critical mass and increased
market
   attention, which should improve liquidity in the stock and greatly
increase
   the merged company's ability to raise capital for expansion where
necessary.
   The new entity will rank in the top 70 listed companies in
Australia."

   It is proposed Baycorp Advantage will be publicly listed in both
Australia
   and New Zealand with a primary listing on the Australian Stock
Exchange and a
   secondary listing on the New Zealand Stock Exchange.

   Attachments:

   Background - the Merger in Detail

   The Rationale behind the Merger

   Company Overview - Baycorp

   Company Overview - Data Advantage.

   This announcement and attachments are posted at: www.baycorp.co.nz or

   www.dataadvantage.com.au

   End CA:00069768 For:BCH    Type:MERGE      Time:2001-08-07:12:50:01
Encrypt:Y


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