Revised Acquisition of Corus by Tata Steel

1/31/2007, 3:50 AM (Source: GlobeNewswire)



NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION IN WHOLE OR IN PART, IN,
INTO OR FROM ANY JURISDICTION WHERE TO DO THE SAME WOULD CONSTITUTE A
VIOLATION OF THE RELEVANT LAWS OF SUCH JURISDICTION


31 January 2007

REVISED ACQUISITION


of Corus by Tata Steel


Following the conclusion of the auction process conducted by the
Panel in accordance with Rule 32.5 of the Code (the "Auction"), the
board of Tata Steel is pleased to announce the terms of a proposed
increased Acquisition (the "Revised Acquisition") at a price of 608
pence in cash per Corus Share, being 5 pence per share higher than
the offer by Companhia Siderurgica Nacional ("CSN") of 603 pence in
cash per Corus Share.

Details of the terms of the original Acquisition, which was
recommended by the Board of Corus, were set out in the scheme
document posted to Corus Shareholders on 10 November 2006 (the
"Scheme Document").

In accordance with the Auction rules published by the Panel on 26
January 2007, following this announcement, Tata Steel will be seeking
a recommendation for the Revised Acquisition from the Board of Corus.

It is anticipated that, subject to a number of factors, including the
timetable requirements of the Court, satisfaction of the Conditions
and receiving a recommendation for the Revised Acquisition from the
Board of Corus, the Effective Date and the despatch of consideration
pursuant to the Scheme to Corus Shareholders will occur around the
middle of March 2007.

Defined terms in this announcement have the same meaning as in the
Scheme Document.

1. Terms of the Revised Acquisition

Under the terms of the Revised Acquisition, Corus Shareholders will
be entitled to receive 608 pence in cash for each Corus Share (the
"Revised Price"). This represents a price of 1216 pence in cash for
each Corus ADS.

The terms of the Revised Acquisition value the entire existing issued
and to be issued share capital of Corus at approximately £6.2 billion
and the Revised Price represents:

(i) an increase of approximately 33.6 per cent. compared to 455
pence, being the Price under the original terms of the Acquisition;

(ii) on an enterprise value basis, a multiple of approximately 7.0
times EBITDA from continuing operations for the year ended 31
December 2005 and a multiple of approximately 9.0 times EBITDA from
continuing operations for the twelve months to 30 September 2006
(excluding the non-recurring pension credit of £96 million);

(iii) a premium of approximately 68.7 per cent. to the average
closing mid-market price of 360.5 pence per Corus Share for the
twelve months ended 4 October 2006, being the last Business Day prior
to the announcement by Tata Steel that it was evaluating various
opportunities including Corus;

(iv) a premium of approximately 49.2 per cent. to the closing
mid-market price of 407.5 pence per Corus Share on 4 October 2006,
being the last Business Day prior to the announcement by Tata Steel
that it was evaluating various opportunities including Corus; and

(v) a premium of approximately 21.6 per cent. to the revised
acquisition announced by Tata Steel on 10 December 2006 at a price of
500 pence per Corus Share.

The terms of this Revised Acquisition described in this announcement
remain subject to the Conditions and do not affect Tata Steel's
intentions regarding the business of Corus, its management, employees
and locations, nor the proposals relating to Corus's pension schemes,
the Corus Share Schemes or cancellation of the Deferred Shares, each
as described more fully in the Scheme Document.

Further details of the Revised Acquisition will be contained in a
circular which is expected to be posted by Corus to Corus
Shareholders in due course and in any event in advance of the EGM and
Court Meeting (the "Revised Scheme Document"). On 4 December 2006 the
original EGM and Court Meeting of Corus were adjourned to 20 December
2006, and on 20 December 2006 at the reconvened EGM and Court Meeting
it was resolved to adjourn the meetings until further notice. The
Revised Scheme Document will contain advice to Corus Shareholders on
the action that shareholders should take at those meetings.

2. Financing

Save as described in the paragraph, the financing arrangements
relating to Tata Steel UK, as described in Part Nine of the Scheme
Document, remain in place. The financing arrangements put in place by
Tata Steel prior to announcement of its revised offer for Corus on 10
December 2006 also remain in place. The additional finance required
under the proposed terms of the Revised Acquisition will be funded by
way of a combination of additional credit facilities and a cash
contribution by Tata Steel to Tata Steel UK.

ABN AMRO and Deutsche Bank, as joint financial advisers to Tata Steel
and Tata Steel UK, are satisfied that sufficient resources are
available to satisfy in full the consideration payable to Corus
Shareholders under the proposed terms of the Revised Acquisition.

3. Implementation Agreement and Inducement Fee

The Implementation Agreement as described in the Scheme Document
remains in effect. The amount of the Inducement Fee referred to in
the Implementation Agreement is 1 per cent. of the value of the
recommended offer announced by Tata Steel and Corus at 10 December
2006 calculated by reference to the price per Corus Share and the
fully diluted share capital of Corus, together with an amount equal
to any VAT which is recoverable by Corus (if applicable).

4. Disclosure of interests in Corus

Tata Limited, a majority-owned subsidiary of Tata Sons, holds 2,125
Corus Shares. Since Corus Shares held either by members of the Tata
Steel Group or by Tata Limited are excluded from the definition of
Scheme Shares, Tata Steel will not be entitled to vote these Shares
at the Court Meeting.

The interests of the Deutsche Bank Group consist of, as at 26 January
2007, a long position of 4,059,945 Corus Shares and a long position
of 472,597 Dutch Bonds.

Following the recommendation by the Corus Directors of the CSN offer,
the irrevocable undertakings the Corus Directors gave to vote in
favour of the Acquisition, as described in the Scheme Document, have
lapsed.

Except as disclosed in this paragraph 4, as at 26 January 2007, being
the last practicable date before this announcement, neither Tata
Steel or Tata Steel UK, nor any of the directors of Tata Steel or
Tata Steel UK, nor so far as Tata Steel and Tata Steel UK are aware,
any person acting in concert with Tata Steel or Tata Steel UK, (i)
has any interest in or right to subscribe for any relevant Corus
securities, nor (ii) has any short positions in respect of relevant
Corus securities (whether conditional or absolute and whether in the
money or otherwise), including any short position under a derivative,
any agreement to sell or any delivery obligation or right to require
another person to take delivery, nor (iii) has borrowed or lent any
relevant Corus securities (save for any borrowed shares which have
been on-lent or sold).

5. Dutch Bonds

Appropriate consent from holders of the Dutch Bonds for the proposal
to redeem the Dutch Bonds early (two business days after the
Effective Date) has been obtained, but such consent will expire on 28
February 2007. As the Effective Date is now unlikely to occur before
that date, a new proposal will be made to holders of Dutch Bonds in
due course on substantially similar terms to the original proposal.

6. General

Save as set out above, in all other respects, including the
availability and terms of the Loan Note Alternative, the Revised
Acquisition will be subject to the Conditions and on the same terms
set out in the Scheme Document.

Appendix I sets out the bases and sources of certain information
contained in this announcement.

Enquiries:


Tata Steel Limited
Koushik Chatterjee, Vice President Finance Tel: +91 (0) 22 6665
8112
Sanjay Choudhry, Head of Corporate Tel: +91 (0) 65 7243
Communications 1142

ABN AMRO (financial adviser to Tata Steel and broker to the
Acquisition)
Jitesh Gadhia Tel: +44 (0) 20 7678
7678
Richard Walker Tel: +44 (0) 20 7678
1451
Paul Nicholls (corporate broking) Tel: +44 (0) 20 7678
8000

Deutsche Bank (financial adviser to Tata Steel and broker to the
Acquisition)
Brett Olsher Tel: +44 (0) 20 7545
8000
Anthony Parsons Tel: +44 (0) 20 7545
8000
Omar Faruqui Tel: +44 (0) 20 7545
8000
Charlie Foreman (corporate broking) Tel: +44 (0) 20 7545
8000

Rothschild (financial advisor to Tata Steel)
Richard Murley Tel: +44 (0) 20 7280
5440
Meyrick Cox Tel: +44 (0) 20 7280
5072

Financial Dynamics (PR adviser to Tata Steel - Tel: +44 (0) 20 7269
UK) 7121
Andrew Lorenz
Richard Mountain
Christopher Clark

Vaishnavi Corporate Communications (PR adviser to Tata Steel - India)
Manoj Warrier Tel: +91 (0) 22 6656
8787
Natasha Pal Tel: +91 (0) 22 6656
8787
Vishal Mehta Tel: +91 (0) 22 6656
8787


This announcement is not intended to and does not constitute, or form
part of, any offer or invitation to purchase any securities or the
solicitation of any vote or approval in any jurisdiction pursuant to
the Revised Acquisition or otherwise. The Revised Acquisition will be
made solely through the Revised Scheme Document, which will contain
the full terms and conditions of the Revised Acquisition, including
details of how to vote in respect of the Revised Acquisition. Any
response to the Revised Acquisition should be made only on the basis
of the information contained in the Revised Scheme Document.

ABN AMRO Corporate Finance Limited, which is authorised and regulated
by the Financial Services Authority, is acting for Tata Steel and
Tata Steel UK in connection with the Revised Acquisition and is not
acting for any other person in relation to the Revised Acquisition
and will not be responsible to anyone other than Tata Steel and Tata
Steel UK for providing the protections afforded to clients of ABN
AMRO Corporate Finance Limited, nor for providing advice in relation
to the Revised Acquisition or any matters referred to herein.

Deutsche Bank AG is authorised under German Banking Law (competent
authority: BaFin - Federal Financial Supervising Authority) and with
respect to UK commodity derivatives business by the Financial
Services Authority; regulated by the Financial Services Authority for
the conduct of UK business. Deutsche Bank AG is acting for Tata Steel
and Tata Steel UK and no one else in connection with the Revised
Acquisition and will not be responsible to anyone other than Tata
Steel and Tata Steel UK for providing the protections afforded to
clients of Deutsche Bank AG nor for providing advice in connection
with the Revised Acquisition or any matters referred to therein.

N M Rothschild & Sons Limited ("Rothschild"), which is authorised and
regulated in the UK by the Financial Services Authority, is acting
for Tata Steel and Tata Steel UK in connection with the Revised
Acquisition and is not acting for any other person in relation to the
Revised Acquisition and will not be responsible to anyone other than
Tata Steel and Tata Steel UK for providing the protections afforded
to clients of Rothschild, nor for providing advice in relation to the
Revised Acquisition or any matters referred to herein.

The availability of the proposals discussed herein to persons who are
not resident in the United Kingdom may be affected by the laws of the
relevant jurisdictions. Persons who are not so resident should inform
themselves about and observe any applicable requirements. Further
details in relation to overseas shareholders will be contained in the
Revised Scheme Document.

The distribution of this announcement in jurisdictions other than
England and Wales may be restricted by law and therefore persons in
such jurisdictions into whose possession this announcement comes
should inform themselves about and observe such restrictions. Any
failure to comply with the applicable restrictions may constitute a
violation of the securities laws of any such jurisdiction. This
announcement has been prepared for the purposes of complying with
English law and the Takeover Code, and the information disclosed may
not be the same as that which would have been disclosed if this
announcement had been prepared in accordance with the laws of
jurisdictions outside of England and Wales.

The Loan Notes that may be issued pursuant to the Revised Acquisition
have not been and will not be registered under the Securities Act of
1933, as amended (the "Securities Act") or under the relevant
securities laws of any state or territory or other jurisdiction of
the United States. Accordingly, Loan Notes may not be offered or sold
in the United States, except in a transaction not subject to, or in
reliance on an exemption from, the registration requirements of the
Securities Act and such state securities laws.

Any Loan Notes which may be issued pursuant to the Revised
Acquisition have not been and will not be registered under the
relevant securities laws of the Netherlands or Japan and any relevant
clearances and registrations have not been, and will not be, obtained
from the securities commission of any province of Canada. No
prospectus in relation to the Loan Notes has been, or will be, lodged
with, or registered with, the Australian Securities and Investments
Commission, the Dutch Listing Authority or the Japanese Ministry of
Finance. Accordingly, unless otherwise determined by Tata Steel UK
and permitted by applicable law and regulation, the Loan Notes may
not be, offered, sold, resold, transferred, delivered or distributed,
directly or indirectly in or into the Netherlands, Canada, Australia
or Japan or any other jurisdiction where to do so would violate the
laws of that jurisdiction or would require registration thereof in
such jurisdiction.

The Dutch Listing Authority has not reviewed, approved or disapproved
this announcement, the Revised Acquisition or the Loan Notes nor has
it expressed a view on the accuracy or adequacy of this announcement.

The Revised Acquisition relates to the shares of a UK company and are
proposed to be made by means of a scheme of arrangement under English
company law. A transaction effected by means of a scheme of
arrangement is not subject to the tender offer rules under the
Exchange Act. Accordingly, the Revised Acquisition is subject to the
disclosure requirements, rules and practices applicable in the United
Kingdom to schemes of arrangement, which differ from the requirements
of US tender offer rules. Financial information included in the
relevant documentation will have been prepared in accordance with
accounting standards applicable in the UK and India that may not be
comparable to the financial statements of US companies.

This announcement includes 'forward-looking statements' under United
States securities laws, including statements about the expected
timing of the Revised Acquisition, the expected effects on Corus of
the Revised Acquisition, anticipated earnings enhancements, estimated
cost savings and other synergies, potential strategic options, plans
for and benefits of integration, estimated future growth, market
position and steelmaking capacity and all other statements in this
announcement other than statements of historical fact.
Forward-looking statements include, without limitation, statements
that typically contain words such as 'will', 'may', 'should',
'continue', 'aims', 'believes', 'expects', 'estimates', 'intends',
'anticipates', 'projects', 'plans' or similar expressions. By their
nature, forward-looking statements involve known or unknown risks and
uncertainties because they relate to events and depend on
circumstances that all occur in the future. Actual results may differ
materially from those expressed in the forward-looking statements
depending on a number of factors, including, but not limited to, the
satisfaction of the conditions to the Revised Acquisition, future
market conditions, the behaviour of other market participants, an
adverse change in the economic climate, a fluctuation in the level of
clients' commercial activity, appropriate consultation with employee
representative bodies, a loss of key personnel and the extent to
which the Corus and Tata Steel businesses are successfully
integrated. Many of these risks and uncertainties relate to factors
that are beyond the companies' abilities to control or estimate
precisely, such as future market conditions and the behaviours of
other market participants. The forward looking statements contained
in this announcement are made as of the date hereof and Corus, Tata
Steel and Tata Steel UK assume no obligation and do not intend
publicly to update or revise these forward-looking statements,
whether as a result of future events, new information or otherwise
except as required pursuant to applicable law.

Dealing Disclosure Requirements:

Under the provisions of Rule 8.3 of the Takeover Code, if any person
is, or becomes, "interested" (directly or indirectly) in one per
cent. or more of any class of "relevant securities" of Corus, all
"dealings" in any "relevant securities" of that company (including by
means of an option in respect of, or a derivative referenced to, any
such "relevant securities") must be publicly disclosed by no later
than 3.30 p.m. (London time) on the London business day following the
date of the relevant transaction. This requirement will continue
until the date on which the Scheme becomes effective, lapses or is
otherwise withdrawn or on which the "offer period" otherwise ends. If
two or more persons act together pursuant to an agreement or
understanding, whether formal or informal, to acquire an "interest"
in "relevant securities" of Corus, they will be deemed to be a single
person for the purpose of Rule 8.3.

Under the provisions of Rule 8.1 of the Takeover Code, all "dealings"
in "relevant securities" of Corus by Tata Steel, Tata Steel UK or
Corus, or by any of their respective "associates", must be disclosed
by no later than 12.00 noon (London time) on the London business day
following the date of the relevant transaction.

A disclosure table, giving details of the companies in whose
"relevant securities" "dealings" should be disclosed, and the number
of such securities in issue, can be found on the Takeover Panel's
website at www.thetakeoverpanel.org.uk.

"Interests in securities" arise, in summary, when a person has long
economic exposure, whether conditional or absolute, to changes in the
price of securities. In particular, a person will be treated as
having an "interest" by virtue of the ownership or control of
securities, or by virtue of any option in respect of, or derivative
referenced to, securities.

Terms in quotation marks are defined in the Takeover Code, which can
also be found on the Panel's website. If you are in any doubt as to
whether or not you are required to disclose a "dealing" under Rule 8
you should consult the Panel.

APPENDIX I

BASES AND SOURCES



(a) The value of Corus as implied by the Revised Price is based upon
the fully diluted number of Corus Shares being 1,015,183,283,
including 946,090,659 Corus Shares in issue on 29 January 2007
(including those represented by ADSs, but excluding those held in
treasury), adjusted only for the dilutive effect of the Dutch
Bonds, in-the-money options and LEAP shares.

(b) The premia implied by the Revised Price have been calculated
based on closing Corus Share prices supplied by Datastream.

(c) The multiple of Corus's underlying EBITDA implied by the Revised
Price is based on: (i) the value of the fully diluted share
capital of Corus and the net debt position (including finance
leases) as at 30 September 2006 of £482 million which is adjusted
for cash from option proceeds and conversion of the Euro Bonds
and the Dutch Bonds; (ii) underlying EBITDA for the twelve months
to 30 September 2006 of £737 million from continuing operations
and excluding the non-recurring pension credit of £96 million;
and (iii) underlying EBITDA for the year ended 31 December 2005
of £947 million which is adjusted for the sale of the aluminium
assets.

(d) Unless otherwise stated, the financial information relating to
Corus has been extracted without material adjustment from the
respective published audited reports and accounts for the
relevant periods.

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