Fusion Corporate Partners

Summary of the announcement by Cilantro Acquisitions Limited (a company formed at the direction of funds managed and advised by Cinven Limited and being “Cilantro Acquisitions”) and the Independent Directors of Spice plc (“Spice”)

• Full statement
• Cilantro Acq. Ltd – Form 8 (OPD) (Spice PLC)

Summary

• The board of directors of Cilantro Acquisitions Limited (a company formed at the direction of funds managed and advised by Cinven Limited and being “Cilantro Acquisitions”) and the Independent Directors of Spice plc (“Spice”) are pleased to announce that they have reached agreement on the terms of a recommended cash acquisition by Cilantro Acquisitions of the entire issued and to be issued ordinary share capital of Spice. It is intended that the Acquisition is implemented by way of a Court-sanctioned scheme of arrangement under Part 26 of the Act.
• Under the terms of the Acquisition, Spice Shareholders will receive 70 pence in cash for each Spice Share, valuing Spice’s existing issued and to be issued ordinary share capital at approximately £251.1 million. The price of 70 pence for each Spice Share represents:

■ a premium of approximately 40.7 per cent. to the Closing Price of 49.75 pence per Spice Share on 14 June 2010, being the last business day before Spice’s announcement that it had received an approach from Cinven;

■ a premium of approximately 10.7 per cent. to the Closing Price of 63.25 pence per Spice Share on 1 September 2010, being the last business day before Spice’s announcement that it had received a possible offer from Cinven; and

■ a premium of approximately 5.3 per cent. to the Closing Price of 66.5 pence per Spice Share on 24 September 2010, being the last business day before this announcement.

• Cilantro Acquisitions has received irrevocable undertakings (including from all of the Spice Directors who are also Spice Shareholders) to vote in favour of the Scheme at the Court Meeting (or otherwise be bound by the Scheme) and the Special Resolution to be proposed at the General Meeting in respect of 89,419,260 Spice Shares representing approximately 25.40 per cent. of the existing issued ordinary share capital of Spice.
• In addition, Cilantro Acquisitions has received a non-binding letter of intent from a Spice Shareholder indicating its current intention to vote in favour of the Scheme at the Court Meeting and the Special Resolution to be proposed at the General Meeting in respect of 10,965,717 Spice Shares representing approximately 3.11 per cent. of the existing issued ordinary share capital of Spice.
• The Independent Directors, who have been so advised by Hawkpoint, consider the terms of the Acquisition to be fair and reasonable.  In providing its advice, Hawkpoint has taken into account the commercial assessment of the Independent Directors.  Accordingly, the Independent Directors intend unanimously to recommend to Spice Shareholders to vote in favour of the Scheme at the Court Meeting and the Special Resolution to be proposed at the General Meeting.  The Independent Directors (other than Martin Towers) who are also Spice Shareholders have given irrevocable undertakings to vote in favour of the Scheme at the Court Meeting and the Special Resolution to be proposed at the General Meeting. Martin Towers has undertaken to be bound by the Scheme and has irrevocably undertaken to vote in favour of the Special Resolution to be proposed at the General Meeting but he will not vote on the resolution to approve the Scheme at the Court Meeting for the reason set out in paragraph 10 below.
• Further, the Executive Directors are fully supportive of the Acquisition and have irrevocably undertaken to vote in favour of the Special Resolution to be proposed at the General Meeting and to be bound by the Scheme.
• In order to become effective, the Acquisition must, among other things, be approved by the requisite majorities of the Spice Shareholders present (in person or by proxy) and entitled to vote at the Court Meeting and the General Meeting.
• It is expected that the Scheme Document will be posted on or around 11 October 2010 and that the Court Meeting and General Meeting will be held on or around 4 November 2010. Subject to the satisfaction or waiver of the relevant Conditions, the Scheme will become effective in December 2010.

Commenting on the Acquisition, Pascal Heberling, a director of Cilantro Acquisitions, said:

“We are delighted to be backing Spice as it looks to build on its strong market position serving its customers in the utility and energy sectors. In addition to Cinven’s sector expertise, Spice will also benefit from significant additional funds which will enhance its ability to grow organically and through acquisitions, as well as accelerate the development of its international capabilities.”

Commenting on the Acquisition, Martin Towers, Chief Executive of Spice, said:

“This offer is good for customers, employees and shareholders. Cinven is a highly credible institution with substantial funds at its disposal. As an investor, Cinven will take a long term perspective on our business with a view to supporting continued delivery of excellent service levels to our customers and opportunities for our employees. At the same time, the offer represents an attractive combination of value and certainty for Spice Shareholders.”

UK, Morley, Leeds