30 April 2010
Summary
The Boards of IntercontinentalExchange, Inc. ("ICE") and Climate Exchange plc ("Climate Exchange") are pleased to announce that they have reached agreement on the terms of the unanimously recommended acquisition by Aether Ios Limited ("Bidco"), a wholly-owned subsidiary of ICE, of the entire issued and to be issued share capital of Climate Exchange (the "Acquisition").
Under the terms of the Acquisition, Climate Exchange Shareholders will receive 750 pence in cash for each Climate Exchange Share (the "Offer Price") held at the Scheme Record Time, valuing the entire existing issued and to be issued share capital of Climate Exchange at approximately £395 million.
The Acquisition represents a premium of approximately:
- 56.9 per cent. to the closing price of 478.0 pence per Climate Exchange Share on 29 April 2010, being the last dealing day prior to the date of this announcement;
- 56.5 per cent. to the average closing price of 479.3 pence per Climate Exchange Share for the one month period up to and including 29 April 2010, being the last dealing day prior to the date of this announcement; and
- 44.3 per cent. to the average closing price of 519.6 pence per Climate Exchange Share for the three month period up to and including 29 April 2010, being the last dealing day prior to the date of this announcement.
- The Offer Price has been determined on the basis that no final dividend in respect of the share capital of Climate Exchange will be paid by Climate Exchange in respect of the year ended 31 December 2009.
- It is intended that the Acquisition be implemented by way of a scheme of arrangement under section 152 of the Isle of Man Companies Act. It is expected that the Scheme Document will be posted no later than 28 May 2010 and that the Scheme will become effective and the Acquisition completed by the end of July 2010, subject to the satisfaction or (if applicable) waiver of all relevant conditions.
- The Directors of Climate Exchange, who have been so advised by J.P. Morgan Cazenove and Kinmont, consider the terms of the Acquisition to be fair and reasonable. In providing advice to the Directors of Climate Exchange, J.P. Morgan Cazenove and Kinmont have taken into account the commercial assessments of the Directors of Climate Exchange. Accordingly, the Directors of Climate Exchange will unanimously recommend that Climate Exchange Shareholders vote in favour of the resolutions to be proposed to Climate Exchange Shareholders at the Court Meeting and the Climate Exchange EGM.
- Bidco has received irrevocable undertakings from the Directors of Climate Exchange to vote in favour of the Scheme (or, if applicable, to accept the Offer) in respect of their own beneficial shareholdings, which amount, in aggregate, to 9,026,583 Climate Exchange Shares (representing approximately 19.0 per cent. of Climate Exchange's entire existing issued share capital). The undertakings from the Directors of Climate Exchange will continue to be binding even in the event of a higher competing offer for Climate Exchange being announced.
- Bidco has received a further irrevocable undertaking from Climate Exchange's largest shareholder, Invesco Asset Management Limited ("Invesco"), to vote in favour of the Scheme (or, if applicable, to accept the Offer) in respect of its own beneficial shareholding, which amounts, in aggregate, to 14,160,996 Climate Exchange Shares (representing approximately 29.8 per cent. of Climate Exchange's entire existing issued share capital).
- Bidco has therefore received irrevocable undertakings with respect to 23,187,579 Climate Exchange Shares (representing approximately 48.7 per cent. of Climate Exchange's entire existing issued share capital). Together with ICE's holding of 2,277,034 Climate Exchange Shares (representing approximately 4.8 per cent. of Climate Exchange's entire existing issued share capital), this represents approximately 53.5 per cent. of the entire existing issued share capital of Climate Exchange. Further details of these irrevocable undertakings, including the circumstances in which they will fall away, are set out in paragraph 13 of the following announcement and in Appendix 4.
- The Acquisition of Climate Exchange represents an attractive strategic opportunity to combine two companies with complementary businesses and strengths and to enhance the competitiveness of the respective businesses. ICE and its affiliates already provide Climate Exchange and its affiliates with technology and clearing services and share in the revenue generated by Climate Exchange with respect to the trading and clearing of emissions contracts. The combined business will create an industry leading global carbon derivatives exchange and a single trading platform for environmental contracts worldwide, with a single clearing entity.
Commenting on the Acquisition, Jeffrey C. Sprecher, Chairman and CEO of ICE, said:
"The combination of Climate Exchange's emissions markets and ICE's futures and over-the-counter energy markets is an important and logical strategic combination for our customers and shareholders,and clearly an exciting opportunity for ICE to grow and further diversify our revenues. ICE has been a partner with Climate Exchange and Dr. Sandor since 2003, and we have worked together toward the development and expansion of the emissions markets. The leadership that Climate Exchange has shown in establishing market standards in Europe, and increasingly the U.S. and Asia, has driven its success, and we see continued growth opportunities within these nascent markets globally".
Commenting on the Acquisition, Dr. Richard Sandor, Chairman of Climate Exchange, said:
"The development of our company from initial concept to its leadership role in global environmental markets is a tribute to the vision and efforts of our entire team. We believe that a combination with ICE makes strategic sense and look forward to addressing continued opportunities together. ICE has committed to further developing the Climate Exchange businesses and building on our joint track record of innovation and success to the benefit of our customers across futures and over-the-counter markets in Europe, Asia and the U.S.".
The Acquisition and the Scheme will be subject to the conditions and further terms set out in the following announcement (including those in Appendix 1) and the terms and conditions set out in the Scheme Document when issued. Appendix 2 contains definitions of certain terms used in this summary and in the following announcement. Appendix 3 contains the sources of certain information and bases of certain calculations contained in this summary and in the following announcement. Appendix 4 contains details of the irrevocable undertakings over Climate Exchange Shares received by Bidco.
ICE
Kelly Loeffler, Vice President, Investor Relations & Corporate Communications: +1 770 857 4726
Sarah Stashak, Director, Investor & Public Relations: +1 770 857 0340
Morgan Stanley
Brian Healy: +1 212 761 4000
Christian Lown
Matthew Jarman: +44 20 7425 8000
Rosie Bailey
Climate Exchange
Helen Crooke: +44 20 7382 7800
J.P. Morgan Cazenove (Financial Adviser and Joint Broker)
Barry Weir: +44 20 7588 2828
Jeremy Capstick: +44 20 7742 4000
Kinmont (Financial Adviser)
John O'Malley: +44 20 7087 9100
Matt Stoate
Fox-Pitt Kelton Limited (NOMAD and Joint Broker)
Jonny Franklin-Adams: +44 20 3037 5231
Simon Law
Haggie Financial
Peter Rigby: +44 207 417 8989
Alex Parry