LTG proposes recommended cash offer for NetDimensions

LTG proposes recommended cash offer for NetDimensions

Learning Technologies Group plc is pleased to announce that it has reached agreement with the board of NetDimensions (Holdings) Limited, the integrated enterprise talent management software platform provider, on the terms of a proposed recommended all cash offer for the entire issued and to be issued share capital of NetDimensions.

Highlights

  • Under the terms of the Offer, NetDimensions Shareholders will be entitled to receive:

for each NetDimensions Share            100 pence in cash (“Offer Price”)

  • The Offer Price represents a premium of approximately:

o  27.4 per cent. to the Closing Price of 78.5 pence per NetDimensions Share on the Latest Practicable Date;

o  118.6 per cent. to the Closing Price of 45.75 pence per NetDimensions Share on 4 October 2016, being the last Business Day prior to the announcement by NetDimensions of an unsolicited approach regarding a potential transaction; and

o  29.9 per cent. to the volume weighted average Closing Price of 77 pence per NetDimensions Share for the 30 trading days ended on the Latest Practicable Date.

·      The entitlement to receive the Offer Price under the terms of the Offer values the Offer at approximately £53.6 million (on a fully diluted basis assuming a cash buy-out or cashless exercise of the outstanding “in the money” options over NetDimensions Shares).

·      LTG has received irrevocable undertakings to accept, or procure acceptance, of the Offer from those NetDimensions Directors who are also NetDimensions Shareholders (together with the trustees of trusts in which they have an interest and certain members of their families), in respect of a total of 8,964,027 NetDimensions Shares, representing approximately 17.48 per cent. of NetDimensions’ issued share capital on the Latest Practicable Date.  These undertakings demonstrate the strength of the commitment to and support for the Offer of those NetDimensions Directors (in their capacity as NetDimensions Shareholders) in light of the premium referred to above.

·      In addition, irrevocable undertakings to accept, or procure acceptance, of the Offer have also been received by LTG from certain NetDimensions Shareholders as set out in Appendix III to this Announcement in respect of 20,027,480 NetDimensions Shares in aggregate, representing approximately 39.06 per cent. of NetDimensions’ issued share capital on the Latest Practicable Date.  These undertakings will cease to be binding in circumstances where the Offer is not made to NetDimensions Shareholders by 5.00 p.m. on 21 February 2017 or if a third party announces a competing offer to acquire the entire issued share capital of NetDimensions which is at a price equal to or greater than 110 pence per NetDimensions Share.

·      Accordingly, LTG has received irrevocable undertakings to accept, or procure acceptance of, the Offer in respect of a total of 28,991,507 NetDimensions Shares representing, in aggregate, approximately 56.54 per cent. of NetDimensions’ issued share capital on the Latest Practicable Date.

·      LTG is also pleased to announce a proposed placing to raise approximately £46.5 million by way of a conditional placing of up to 124,000,000 Placing Shares at a price of 37.5 pence per ordinary share with existing and new institutional investors and certain Directors.  The Placing Shares to be issued pursuant to the Placing, assuming that it is fully subscribed, will represent approximately 22.74 per cent. of LTG’s enlarged issued share capital on the Latest Practicable Date.

·      The Offer is conditional upon completion of the Placing, with the balance of the Offer to be funded by a £5 million facility from LTG’s Chairman Andrew Brode and the remainder by a £3.5 million overdraft from Barclays Bank PLC.  The Offer is also conditional upon the consent of Barclays Bank PLC and, inter alia, LTG not being in breach of its existing banking facilities with Barclays Bank PLC.

·      LTG will today post an explanatory circular to its Shareholders in relation to the Placing which includes a Notice of General Meeting for a General Meeting to be held on 20 February 2017 at which the Shareholders will be asked to consider and, if thought fit, approve the Resolutions that will grant the Directors the authority to allot the Placing Shares and the power to disapply pre-emption rights with respect to the Placing.

·      The Directors believe that the Placing and the passing of the Resolutions are in the best interests of LTG and its Shareholders, taken as a whole.  Accordingly, the Directors unanimously recommend that Shareholders vote in favour of the Resolutions, having irrevocably undertaken to do so in respect of their own holdings of LTG ordinary shares, totalling 240,816,383 LTG ordinary shares, being approximately 57.15 per cent. of LTG’s existing issued share capital.

·      The making of the Offer by LTG remains subject to Shareholder approval of the Resolutions to be proposed at the General Meeting (which relate to granting the Directors the authority to allot the Placing Shares and the power to disapply pre-emption rights with respect to the Placing as opposed to approving the Offer).

Approvals and timetable

·      The Offer is subject to a number of Conditions, further details of which are set out in Appendix I to this announcement.

·      The Offer is proposed to be implemented by means of a Takeover Offer.  LTG reserves the right to implement the Offer by way of a Scheme or a by way of a Merger.

·      The Offer is expected to complete within two months of the date of this announcement subject to the Conditions being satisfied.  An indicative timetable of key dates is set out in this announcement.

·      Subject to the passing of the Resolutions, it is expected that the Offer Document will be posted to NetDimensions Shareholders on 21 February 2017.

Commenting on the Offer, Andrew Brode, Chairman of LTG, said:

“Since LTG’s inception in 2013, the board of Directors’ strategic aim has been to build a dynamic portfolio of complementary businesses and an international e-learning business of scale.  We have made great strides towards achieving this ambition, whilst consistently delivering significant earnings growth both organically and through selective acquisition. Most recently, the LTG Group announced that it had achieved strong cash generation and profit ahead of market expectations in the year ended 31 December 2016, as well as significant growth in the overall percentage of recurring revenues, and that it had entered 2017 with significant momentum.

Given the management’s proven track record of creating value through acquisition, the board of Directors is confident that the Offer for NetDimensions represents another opportunity for us to generate significant additional value for new and existing shareholders, at the same time as enhancing the range and scope of LTG’s services across the globe.”

Commenting on the Offer, Graham Higgins, Chairman of NetDimensions, said:

“The board of NetDimensions is very pleased to have reached agreement on the terms of a proposed recommended cash offer by LTG, a business we know well, having collaborated on customer assignments with them in the past.  The Offer, once made, will present an opportunity to crystallise value and provide liquidity for our shareholders as a whole.”

This summary should be read in conjunction with and is subject to the full text of the attached announcement (including the Appendices).  The Offer will be subject to the Conditions and further terms set out in Appendix I to this announcement and the terms and conditions which will be set out in the Offer Document, when issued.

The sources and bases of information contained in this announcement are set out in Appendix II to this announcement and the definitions of certain expressions used in this announcement are set out in Appendix IV to this announcement.

Read the full RNS here

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