Forum Archive Index - April 2002

["DR" <kat47@bigfoot.com>]

16 April, 2002



                            Guinness Peat Group plc
                                      and
                     J O Hambro Capital Management Limited

       Mandatory Cash Offer for Nationwide Accident Repair Services plc

                                  Offer Update
Strand Partners today publishes its second document to Nationwide Shareholders
on behalf of Guinness Peat Group plc ("GPG") and J O Hambro Capital Management
Limited ("JOHCM") in relation to the offer announced on 21 March 2002 to acquire
the issued share capital of Nationwide Accident Repair Services plc ("Nationwide
") not already held by them.

In the document, the Offerors bring the following key issues to the attention of
Nationwide Shareholders:

The document sets out, inter alia, that in the Offerors' opinion:

•         The reported NAV of Nationwide is not an accurate representation of
the ongoing value of the Company

•         Nationwide's record under the Board is one of consistent
under-performance and inconsistent strategy. In the last five years under the
Board's stewardship four chief executives and three finance directors have been
unable to prevent the decline in Nationwide's performance
          -   The reported net asset value of Nationwide has fallen by 30.9 per
              cent. since 30 June 2000

          -   The profit before tax of Nationwide has fallen from £10.1 million
              in the year to 31 December 1997 to a loss of £4.1 million in the
              year to 31 December 2001

•         History shows that key appointments made under the stewardship of the
Nationwide Board have proven demonstrably ineffective

•         The financial performance of National Tyre Service during Adrian
Dunleavy's tenure as Managing Director hardly lends support to Nationwide's
claim that he has the turnaround experience required to rescue Nationwide from
its current position

•         Shareholders are being asked to put their faith in a failed Board and
an unproven management team, who are now suggesting a strategy that involves
aggressively expanding a business in difficulty. Unfortunately, another
strategic review is very much what is required to reverse the declining value of
the Company

•         Nationwide Shareholders cannot afford to leave the current Nationwide
Board in control

Commenting, Blake Nixon, UK Chief Executive of GPG, said:

"Rather than being reassured by the case put forward by the Nationwide Board in
the Defence Document published on 4 April 2002, which appears to be asking
Nationwide Shareholders to place their faith in an unproven management team and
yet another strategy, our concerns are in fact heightened by the apparent
inability of the Nationwide Board to focus on putting its house in order. As the
largest holder of Nationwide Shares, we cannot allow the value of our investment
to be further reduced by the abysmal stewardship of the incumbent Nationwide
Board."
ns used in the Offer Document have the same meanings when used in this
Strand Partners, which is authorised in the United Kingdom by The Financial
Services Authority, is acting for GPG and JOHCM and no one else in connection
with the Offer and will not be responsible to anyone other than GPG and JOHCM
for providing the protections afforded to customers of Strand Partners, nor for
giving advice in relation to the Offer.

Strand Partners has approved the contents of this announcement solely for the
purpose of section 21 of the Financial Services and Markets Act 2000.  The
principal place of business of Strand Partners is 110 Park Street, London, W1K
6NX.

The GPG Directors and the JOHCM Directors accept responsibility for the
information contained in this announcement save that the only responsibility
accepted by them in respect of such information as relates to Nationwide (which
has been compiled from public records) has been to ensure that such information
has been correctly and fairly reproduced and presented. Subject as aforesaid, to
the best of the knowledge and belief of the GPG Directors and the JOHCM
Directors (who have taken all reasonable care to ensure that such is the case),
such information is in accordance with the facts and does not omit anything
likely to affect the import of such information.

This announcement does not constitute, or form part of, an offer or an
invitation to purchase any securities.

REPLY

 

16 April 2002

NATIONWIDE ACCIDENT REPAIR SERVICES PLC
("NATIONWIDE" OR THE "COMPANY")

RESPONSE TO BIDDERS' CLAIMS

The Board of Nationwide notes today's circular to shareholders from Guinness
Peat Group plc and JO Hambro Capital Management Limited (together the
"Bidders").  The Bidders seem unable to understand some simple issues in
relation to Nationwide:

•       The Board's strategy to focus on crash repair activities was clearly set
out for shareholders in March 2001 at the time of the disposal of the motor
dealership activities - shareholders backed the Group's strategy at that time
and the strategy has not changed since.

•       In the circular to shareholders of 4 April 2002, the new management team
set out the immediate action plan for managing the core business and addressing
the trading issues in a small number of under-performing sites.  Surely,
responsible shareholders would be interested in understanding those plans and
the expertise of those implementing them rather than trading ineffectual
rhetoric in public - the Bidders have refused the Board's offer to meet the new
management team.

•       Adrian Dunleavy stands by his record at National Tyre Service.  The core
business improved significantly during his tenure as chief executive - in terms
of underlying trading results, working capital and cash flow.  The results
selectively chosen by the Bidders are fundamentally affected by the significant
restructuring charges and other write-offs that resulted from the repositioning
of this business and the consequent closure of loss making operations.

•       The Board's ability to focus on the key issues facing Nationwide would
be significantly enhanced without the distraction of having to defend Nationwide
against a hostile bid, which has rightly received scant support from other
shareholders.

•       The Bidders are seeking to question the value of the Group's non-core
assets - shareholders should remember that £1.8m has already been realised from
a non-core property disposal this year at its net book value.

•       Shareholders should not be distracted by the Bidders' focus on the finer
points of accounting for pensions but on the underlying issue of managing the
risk to Nationwide of funding pensions.  The Board has managed this risk by
closing the Group's defined benefit scheme to new entrants in December 2001 and
ensuring that the contribution levels adequately fund the liabilities on the
appropriate actuarial basis.

Nationwide's Chief Executive, Adrian Dunleavy, said

" I am sure shareholders will treat the Bidders' latest circular with the same
contempt they have shown for the Offer.  Our other shareholders seem to realise
that Nationwide has significant value in its portfolio of non-core assets and
that our core business is capable of delivering much improved results.  My team
and I are determined to deliver this for shareholders".