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Success for the cash offer made by Saint-Gobain for the british company Meyer International PLC
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The information below concerns the proposed tender offer for ordinary shares of Meyer International Plc. By reading this press release, you will be deemed to represent that you are not a shareholder of Meyer International PLC in the United States and will not provide the information accessed to any person in the United States.
The Board of SAINT-GOBAIN met on 27 January 2000 and unanimously approved the launch of a recommended cash offer for MEYER INTERNATIONAL PLC, the UK’s leading builders’ merchant. MEYER INTERNATIONAL is listed on the London Stock Exchange (MYER.L). This acquisition will significantly increase SAINT-GOBAIN's position in building materials distribution and create a leading position in Europe, where markets are large but fragmented. MEYER INTERNATIONAL's turnover is expected to be about € 2.8bn (£1.7bn) in 2000; SAINT-GOBAIN's turnover in this business is€ 4.1bn (£2.5bn).
The offer price of 515 pence per share represents a premium of 61% over the mid market closing price of 320 pence on 28 January 2000 (i.e. the last available share price before SAINT-GOBAIN approached MEYER INTERNATIONAL). The price offered also represents a 41% premium over the average share price for the month to 28 January 2000. The transaction values the issued equity of MEYER INTERNATIONAL at approximately € 1,726m (£1,040m) and net debt on 30 September 1999 was€ 375bn (£226m).
The Board of MEYER INTERNATIONAL has unanimously agreed to recommend the offer to shareholders.
MEYER INTERNATIONAL generates over 80% of its sales and profits from building materials distribution, is the number 1 (16% market share) in the UK for the distribution of building materials products, and number 2 for plumbing products (15% market share).
The Building Materials Distribution division of SAINT-GOBAIN operates in these two markets in France via its subsidiaries Point P/Lapeyre and La Plateforme du Bâtiment. Turnover was around€ 4.1bn (£2.5bn) in 1999, of which 85% was in building materials and 15% in plumbing. The division grew turnover by on average 13% p.a. in the last four years.
The acquisition of MEYER INTERNATIONAL will make SAINT-GOBAIN the European market leader in building materials distribution, with a multi-format, multi-brand product range. The two businesses are an excellent fit technically and commercially and are geographically complementary in Europe. This alliance will provide the customers of both companies with a wider range of products and will build on the strengths of Point P and Lapeyre in France and MEYER INTERNATIONAL in the UK. On a pro forma basis, the combined sales of the businesses would have been around€7bn (£4.2bn) in 1999. The deal will increase the contribution of building materials distribution to SAINT-GOBAIN’s turnover from 18% to 27% and its contribution to operating profit from 11% to 17%.
The deal will allow SAINT-GOBAIN to benefit from substantial synergies, which are expected to arise from both increased purchasing power and sharing of best practices (marketing, logistics, information systems) in France and the UK as well as in the rest of Europe. The acquisition will be earnings enhancing for SAINT-GOBAIN from 2001.
24/03/2000
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