KPN intends to make a recommended cash offer of EUR 6.25 per ordinary share for Getronics

7/30/2007, 8:00 AM (Source: GlobeNewswire)

This is a joint press release of Royal KPN N.V. and Getronics N.V.
pursuant to the provisions of Section 9b paragraph 2 sub a of the
Dutch Securities Markets Supervision Decree (Besluit toezicht
effectenverkeer 1995). This is not a public announcement that a
public offer is made, but that the expectation is justified that
agreement can be reached on the terms and conditions of a public
offer as set forth in this announcement. Not for release, publication
or distribution, in whole or in part, in or into the United States,
Canada, Australia and Japan.

The Hague, Amsterdam, 30 July 2007

* KPN intends to make a recommended cash offer of EUR 6.25 per
ordinary share for Getronics, or EUR 766 million in total; KPN is
able to finance the offer from its existing financial resources,
whilst remaining within the boundaries of its self-imposed
financial framework

* The offer price represents a 23% premium to Getronics' closing
price on 27 July 2007, the last business day before this

* The combination of KPN and Getronics will have outstanding
capabilities in both IT and telecommunication services and provides
the skills to become a prime contractor for converged ICT services

* The transaction fits with KPN's stated ICT strategy of
transforming its business segment into an end-to-end ICT services

* KPN will continue Getronics' stated strategy to focus on the core
operations in the Netherlands, Belgium, United Kingdom and North
America, and global service delivery capabilities, to transfer the
owned operations into partnerships, which Getronics currently has
in progress (Iberia, and Hong Kong/China) and to evaluate the
future of the other operations

* Getronics' Supervisory Board and Management Board unanimously
support the intended offer

Royal KPN N.V. ("KPN") and Getronics N.V. ("Getronics" or the
"Company") jointly announce that the expectation is justified that
agreement can be reached in connection with a public offer by KPN for
all the issued and outstanding ordinary shares in Getronics
("Ordinary Shares") at an offer price of EUR 6.25 in cash, inclusive
of any dividend payable for the financial year 2007 (the "Offer
Price") per ordinary share (the "Offer"). Taking into account all
organisational, social and financial aspects, the Supervisory Board
and Management Board of Getronics (the "Boards") believe that the
Offers are in the best interest of all stakeholders. The Boards will
unanimously recommend that Getronics shareholders accept the Offer.
KPN further intends to make all-cash offers for all of the issued and
outstanding senior notes convertible into ordinary shares in the
capital of the Company, as well as for the cumulative preference
shares issued by Getronics (see also under "Convertible bonds
Getronics" below).
Last Twelve Months, Getronics has reported revenue and EBITAE of EUR
2,247m and EUR 60.5m respectively for continued operations, all as
per the reporting definitions of Getronics.

Rationale for the Offer
Getronics has strong competences in workspace management and
application services. Therefore, the proposed acquisition of
Getronics will reinforce the stated ICT strategy of KPN's business
segment and further transform KPN from a communication service
provider to an end-to-end provider of ICT services. Key benefits of
combining Getronics with KPN are:

* combination becomes the prime contractor to provide end-to-end,
integrated ICT services, with enhanced time-to-market and product
development capabilities;

* significant cross-and up-selling opportunities to one another's
client bases;

* strong platform to benefit from the relatively untapped and fast
growing SME market segment, leveraging the KPN sales force;

* expected synergies of at least EUR 50m per annum as of 2009;

* opportunity to use Getronics' tax losses carry forward with NPV of
over EUR 100m.

Commenting on the proposed Offer, Mr. Scheepbouwer (CEO of KPN),
said: "Telecommunications and IT services are increasingly becoming
two sides of the same coin. More and more companies are converging
their telecoms and IT requirements, sourcing all services from a
single end-to-end vendor. Combining Getronics' business with our own
will immediately add value and be transformational for our existing
ICT business. It will give us in one step real critical mass and
significant expertise, enhancing our opportunity to become the ICT
partner of choice for our widened client-base in our key

Commenting on the proposed Offer, Mr. Wagenaar (CEO of Getronics),
said: "This creates an unique opportunity to implement a joint
complementary strategy that will provide instant financial stability
to our business and a strong platform to further strengthen our
position as a successful provider in converged ICT services in our
key geographies. This proposal puts fair value on our craftsmanship,
our rich client base comprising of many multinational and national
clients, the high level of client satisfaction that we consistently
achieve, our global service delivery and our outstanding competences
in workspace management and application services".

Offer highlights
The intended Offer would be a cash offer for all the issued and
outstanding ordinary shares of Getronics. Based on the intended Offer
Price of EUR 6.25 per ordinary share inclusive of any dividend
payable for the financial year 2007 ("cum dividend"), Getronics'
issued and outstanding capital is valued at approximately EUR 766
million. The Offer Price of EUR 6.25 per ordinary share represents an
excellent opportunity to Getronics shareholders to sell their
interest in Getronics and implies a 23% premium to Getronics' closing
price on 27 July 2007, the business day before this announcement.

Convertible bonds Getronics
KPN further intends to make offers for (i) the EUR 100,000,000 5.5%
listed unsubordinated convertible bonds due 2008 ("Bonds 2008"), of
which EUR 10,869,000 is still outstanding, at a price of EUR 1,040 in
cash plus accrued interest (Bonds 2008 Offer Price) per EUR 1,000 in
principal amounts of the Bonds 2008 ("Bonds 2008 Offer"), (ii) the
EUR 150,000,000 2.75% listed unsubordinated convertible bonds due
2010 ("Bonds 2010") at a price of EUR 50,500 in cash plus accrued
interest (Bonds 2010 Offer Price) per EUR 50,000 in principal amounts
of the Bonds 2010 ("Bonds 2010 Offer") and (iii) the EUR 95,050,000
3.875% listed unsubordinated convertible bonds due 2014 ("Bonds
2014") at a price of EUR 52,500 in cash plus accrued interest (Bonds
2014 Offer Price) per EUR 50,000 in principal amounts of the Bonds
2014 ("Bonds 2014 Offer", together with Bonds 2008 Offer, Bonds 2010
Offer and Offer the "Offers").

Strategy, governance and organisation
KPN intends to continue Getronics' strong global delivery capability
for future-ready workspace management and related consulting and
transformation services, supported by international partnerships.
Therefore KPN will retain the international infrastructure required
to service multinational customers. To optimise the benefits of the
combination, KPN intends to integrate its own ICT and corporate
solutions business into Getronics. It is expected that the Getronics
brand name will be maintained as it is highly regarded by its
customers and KPN actively pursues a multi-brand strategy. Going
forward, KPN will review activities that are insufficiently linked.

Getronics' Dutch and Belgian activities are at the core of KPN's ICT
strategy because KPN has significant activities in these countries
already. As a consequence, KPN intends to rationalise central and
group functions post-closing of the Offer. Redundancies are currently
expected to be limited. KPN will also maintain Getronics' sales and
delivery capabilities in the UK and North America, which in turn
supports serving Getronics' international client base.

In line with Getronics' stated strategy in Getronics' 1 December 2006
company update, KPN intends to evaluate, in due course, non-core
operations outside of the Netherlands, Belgium, United Kingdom and
North America, while maintaining the strong global delivery
capability for multinational customers. Furthermore, KPN intends to
continue the intended transactions of the Iberia and Hong Kong/China
operations that Getronics currently has in process, to the extent
such transactions have not been completed upon the closing of the
intended Offers.

If the Offers are declared unconditional, KPN intends to terminate
Getronics' listing on Euronext Amsterdam N.V. ("Euronext Amsterdam")
as soon as possible. Furthermore, subject to the necessary threshold
being reached, KPN expects to initiate the statutory squeeze-out
procedure in accordance with the Dutch Civil Code in order to acquire
all shares held by minority shareholders or take such other steps to
terminate the listing and/or acquire all shares that will not have
been tendered, including effecting a legal merger (juridische fusie).
Upon closing of the proposed Offers, KPN intends to appoint a new
Getronics Board of Management and Supervisory Board, as the existing
Boards will step down in mutual agreement on settlement. "As the
Company now enters in to a new phase, we feel we should leave ample
room for new leadership to further build on the strong position of
the new combination", said Mr. Wagenaar (CEO of Getronics).

Conditions precedent
The commencement of the Offers is subject to the satisfaction or
waiver of certain pre-offer conditions customary for a transaction of
this kind, such as no revocation of the recommendation of the Offers
by the Boards of Getronics, the absence of a material adverse effect
on the business of the Getronics group, obtaining regulatory
approvals, obtaining the advice of Getronics' and KPN's works
councils and concluding the discussion with the trade unions. The
launch of the Offers is further subject to the (waivable) condition
precedent that the holders of depositary receipts in respect of the
cumulative preference shares commit irrevocably to the Offer or not
to exercise conversion rights and to tender the depositary receipts
(all under the condition precedent of the Offers being honoured).

The honouring of the Offers (gestanddoening) will be subject to
certain customary conditions for a transaction of this type
including, but not limited to the conditions that (i) at least 80%
(on a fully diluted basis but excluding conversion of Bonds 2008,
Bonds 2010 or of the cumulative preference shares) of Getronics'
issued and outstanding ordinary share capital has been tendered, (ii)
approval by the relevant competition authorities has been obtained,
and (iii) no material adverse change with respect to the business of
Getronics has occurred.

KPN is entitled to a break fee of EUR 7 million in the event that the
Getronics board recommends a competing proposal.

Further process
KPN and Getronics expect to reach full agreement on the intended
Offers over the next weeks, including as to the composition of the
Boards post-settlement of the Offers. The offer memorandum containing
the terms and conditions of the Offers is currently expected to be
published in September 2007, and the Offers will thereafter be
discussed in an extraordinary general meeting of shareholders of
The Netherlands Authority for the Financial Markets (Autoriteit
Financiële Markten), Euronext Amsterdam N.V. and the Social Economic
Council (Sociaal Economische Raad), and the relevant anti-trust
authorities have been or will be informed of the intended Offers. The
relevant trade unions have been duly notified. The works councils of
Getronics and KPN will be requested for advice.
ING Corporate Finance acts as financial advisor to KPN. ABN Amro acts
as financial advisor to Getronics. Rabo Securities acts as financial
advisor to the Supervisory Board of Getronics. Allen & Overy LLP acts
as legal advisor to KPN. Stibbe acts as legal advisor to Getronics.

About KPN
KPN is the leading provider of telecommunications services in the
Netherlands, serving customers with wireline and wireless telephony-,
internet- and TV services. To business customers, KPN delivers
voice-, internet- and data services as well as fully-managed,
outsourced ICT solutions. Both nationally and internationally, KPN
provides wholesale network services to third parties, including
operators and service providers. In Germany and Belgium, KPN pursues
a multi-brand strategy with its mobile operations, and serves
multiple customer segments in consumer as well as business markets.

At June 30, 2007, KPN served 5.8 million wireline voice subscribers,
8.8 million mobile customers, 2.5 million Internet customers and 0.3
million TV customers in the Netherlands as well as 16.1 million
mobile customers in Germany and Belgium. With 27,096 individuals
(24,881 FTEs), KPN posted revenues of EUR 5.9bn, with an EBITDA of
EUR 2.5bn in the first half year of 2007. KPN was incorporated in
1989 and is listed on the Amsterdam, New York, London and Frankfurt
stock exchanges.

About Getronics
With some 24,000 employees in 25 countries and revenues of EUR 2.6
billion in 2006, Getronics is a leading international provider of
Information and Communication Technology (ICT) services and
Applying its expertise in workspace management, applications, and
consulting and transformation services, Getronics helps organisations
raise their performance and increase the productivity of their
people, by providing them with the ability to share information and
to work together efficiently, securely and effectively, wherever and
whenever they need.

Getronics headquarters are in Amsterdam, with regional offices in
Boston and Singapore. The Ordinary Shares and Bonds 2008 are listed
on Eurolist by Euronext Amsterdam and the Bonds 2010 and Bonds 2014
are listed on the official list of the Luxembourg Stock Exchange. For
further information about Getronics, visit

Download full press release as pdf - English

Download full press release as pdf - Dutch

Press and Investor Enquiries
Press enquiries: Marinus Potman
Tel: +31 70 44 66 300

Investor enquiries: Eric Hageman, Head of IR
Tel: +31 70 34 39 144

Press enquiries: Simon Theeuwes
Tel: +31 20 586 1581

Investor enquiries: Simon Theeuwes, Vice-President Investor Relations
Tel: +31 20 586 1982

This announcement may contain forward-looking statements. These
forward-looking statements include all matters that are not
historical facts. By their nature, forward-looking statements involve
risks and uncertainties because they relate to events and depend on
circumstances that may or may not occur in the future. As such, they
are not guarantees of future performance and are not intended to give
any assurances as to future results.

This announcement does not constitute, or form any part of, an offer,
or any solicitation of any offer, to buy or subscribe for any
securities of Getronics N.V. or any other securities, nor shall it
(or any part of it) form the basis of, or be relied upon in
connection with, any contract therefore. In the event that such an
offer is made, details of the offer will be set out in an Offer
Memorandum, which will contain the full terms and conditions of the
offer including how the offer can be accepted, and which will be made
available to all holders of securities of Getronics N.V. free of

This announcement is an advertisement and not a prospectus and
holders of ordinary shares in Getronics N.V. should not make any
decisions except on the basis of the information contained in the
offer memorandum to be published in due course.

In particular, this announcement does not constitute an offer of, or
the solicitation of any offer to buy or subscribe for, any shares in
Getronics N.V. to any person in any jurisdiction to whom or in which
such offer or solicitation is unlawful and therefore persons into
whose possession this presentation comes should inform themselves
about and observe any such restrictions. In particular, this
announcement is not for distribution in or into the United States of
America, Australia, Canada and Japan. Furthermore, in the event that
an offer is made, it will not be made directly or indirectly, in or
into the United States of America, Australia, Canada and Japan.

This announcement will also be published in Dutch. In the event of
any inconsistencies between the English and Dutch versions of this
announcement, the English version will prevail.

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