ZURICH, Switzerland – 31 January 2012 – Myriad Group AG (SIX Swiss Exchange: MYRN), the company that powers mobile social and web experiences on connected devices, today announced the terms of a share offer (the “Offer”) to acquire the entire issued and to be issued ordinary share capital of Synchronica plc (AIM: SYNC; TSX Venture: SYN) at a value equivalent to approximately £ 20.63 million.
Synchronica shareholders are entitled to receive 4.67 newly issued Myriad shares for every 100 Synchronica shares
Based on the closing price of a Myriad share of CHF 4.01 and an exchange rate of CHF 1.44 to £ 1.00 on 30 January 2012, being the latest practicable date prior to this announcement, the Offer values each Synchronica share at 13 pence, representing a premium of approximately:
70.49% to the closing price of a Synchronica share of 7.625 pence on 10 November 2011, being the date prior to 11 November 2011, the date on which Myriad first made a non-binding indicative proposal to the Board of Synchronica regarding a potential offer;
89.02% to the 60-dealing day volume-weighted average share price of a Snychronica share of 6.88 pence prior to 3 January 2012, the date of Synchronica’s announcement that it had received an approach from Myriad regarding a potential offer; and
67.74% to the closing price of a Synchronica share of 7.750 pence on 30 December 2011, being the last practicable dealing day prior to the date of Synchronica’s announcement that it had received an approach from Myriad regarding a potential offer
As at 10 November 2011, Synchronica had a market capitalisation of £ 12.1 million and an obligation to pay deferred acquisition consideration to Nokia Corporation (“Nokia”) of approximately US$ 20.2 million (the “Nokia Debt”), which is payable in full before 31 December 2015
As at 30 January 2012, Myriad had a market capitalisation of approximately CHF 197.05 million (approximately £ 136.85 million) and it had a cash balance of approximately US$ 25 million as of 31 December 2011 (unaudited)
Myriad has received confirmation from Nokia that the Nokia Debt will not become immediately payable in full as a result of the Offer
“We view our all share offer as attractive to the shareholders of Synchronica. It represents a significant premium to Synchronica’s volume-weighted average share price in November and December 2011, prior to the announcement that we were in discussions regarding a transaction, and a compelling value proposition, affording Synchronica shareholders continued participation in a combined business that we consider will be a leader in mobile software technology, with an enhanced product portfolio and cross-selling opportunities. The combined businesses should be well positioned to exploit the opportunities presented by the growing global demand for mobile data consumption and to deliver enhanced value for shareholders” said Simon Wilkinson, Chief Executive Officer and member of the Board of Directors of Myriad Group.
Synchronica plc, a public company incorporated in the UK, generated sales of US$ 10.9 million in 2010 and US$ 12.8 million for the first nine months of 2011. The company’s shares are traded on AIM (AIM: SYNC) and on the TSX Venture Exchange (TSX-V: SYN). Synchronica is a developer of next-generation mobile messaging solutions based on open industry standards. Synchronica’s business is now predominantly based on its flagship product – Mobile Gateway – providing push email, synchronisation, instant messaging, backup and restore and mobile connectivity to popular social networking services. Synchronica’s products are white-labelled and offered by mobile network operators and device manufacturers in emerging and developed markets. Synchronica has regional presences in the UK, Canada, USA, Hong Kong, Spain and Dubai. It also operates dedicated development centres in Germany and in the Philippines.
Strategic rationale
The acquisition of Synchronica by Myriad would create a European-headquartered global business with an increased opportunity to capitalise on expanding world and regional markets. Through increased revenue generation based on consolidated technical excellence and global execution, it has the potential to increase shareholder value for Synchronica shareholders and Myriad shareholders through a proposition that should deepen the combined group’s relationship with existing service provider customers and the extension of its geographic delivery. The combined group will also have a research, development and support capability that should accelerate new business development.
The Board of Directors of Myriad continues to see opportunity arising from the growth in global mobile data consumption. It believes that Synchronica’s customer base and the industry segments it serves complement those of Myriad, affording the scope to extend the market reach of both business’ products and technologies. With an enhanced product offering, cross-selling opportunities, a strengthened IP portfolio and the potential for synergies, Myriad believes that the potential acquisition would enhance its position as a global player, serving more than 100 mobile operators and over 20 handset manufacturers and OEMs.
Financing of the Offer
The transaction will be financed through the issue of new Myriad shares to the shareholders of Synchronica. Under the terms of the Offer, Synchronica shareholders will be entitled to receive 4.67 new Myriad shares for every 100 Synchronica shares they hold. Based on a closing price per Myriad share of CHF 4.01 and an exchange rate of CHF 1.44 to £ 1.00 on 30 January 2012, being the latest practicable date prior to this announcement, the Offer values each Synchronica share at 13 pence and Synchronica at approximately £ 20.63 million.
Myriad will convene an Extraordinary General Meeting of Shareholders (“EGM”), to be held on 23 February 2012, to approve authorised share capital for the creation of the new Myriad shares. The Board of Directors will propose to the EGM to approve authorised share capital of CHF 1,170,135 million. This is equivalent to 11,701,350 registered shares with a nominal value of CHF 0.10 each. The issue of such shares out of the authorised share capital shall be possible until 23 February 2014. The current listed share capital of Myriad amounts to 49,140,515 registered shares.
Principal conditions of the Offer
Completion of the Offer is conditional upon, inter alia:
The EGM of Myriad to approve all necessary resolutions required for the capital increase connected with the public share exchange Offer;
Valid acceptances having been received and not withdrawn in respect of not less than 90% of Synchronica shares to which the Offer relates and not less than 90% of the voting rights carried by those shares; this percentage may however be reduced by Myriad to any percentage above 50%; and
The new Myriad shares having been approved for listing on the Main Standard of the SIX Swiss Exchange in accordance with applicable formalities of Swiss law and the listing rules of the SIX Swiss Exchange
The Offer is also subject to certain other conditions which are considered customary for a transaction of this nature.
Further details and all conditions are set out in the announcement document SHARE OFFER, dated 31 January 2012. The document is available free of charge on Myriad’s website
http://www.myriadgroup.com/investors/share-offer-synchronica.aspxDetails of the Offer
Further detailed information on the Offer will be provided in the offer document and the prospectus equivalent document to be produced by Myriad, which are scheduled for publication within 28 days of the date of this announcement.
Applicable law
The Offer will be subject to the provisions of the UK City Code on Takeovers and Mergers.
