Bulletin
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29 September 2011
The execution of a conditional agreement creating an obligation to sell shares in Crowley Data Poland Sp. z o.o. with Crowley Data L.L.C. and Crowley Poland L.L.C. (47/2011)
The management board of Netia SA (“Netia”), Poland’s largest alternative provider of fixed-line telecommunications services, hereby announces that, on 29 September 2011, Netia, Crowley Data, L.L.C. and Crowley Poland, L.L.C. (the “Sellers”) executed a conditional agreement creating an obligation to sell 197,862 shares in Crowley Data Poland Sp. z o.o. with its registered seat in Warsaw (the “Company”), such shares (the “Shares”) constituting 100% of the Company’s share capital (the “Agreement”).
Under the Agreement the purchase price of the Shares will amount to USD 31.8 million (thirty-one million eight hundred thousand US dollars), established as the Enterprise Value, including the value of the loan as of the transaction closing date, extended to the Company by an entity related to the Seller, such loan being also subject to repayment by Netia. The price for the Shares will be additionally adjusted by the difference in the Company’s balance sheet existing on 31 December 2010 and on the transaction closing date. Since the parties had previously agreed all the principal elements enabling the establishing of the purchase price, on 16 September 2011, Netia executed a foreign exchange risk hedging transaction at the USD/PLN exchange rate of PLN 3.14 per USD 1.00. Consequently, Netia expects to close the transaction for a total sum of PLN 100 million (including the repayment of the loan extended to the Company) regardless of the exchange rate differences existing today and on the transaction closing date.
The closing of the transaction depends on the satisfaction of a condition precedent consisting of Netia obtaining consent from the anti-monopoly authority for the merger within six months from the date of the execution of the agreement; such deadline can be extended to nine months from the date of execution of the Agreement.
The Agreement contains representations and warranties of the Sellers customary for such types of transactions, and those specifically regarding the title to Shares and the condition of the Company’s enterprise as well as the Seller’s liability for warranty inaccuracy. The terms of the Agreement comply with the market practice and in line with the terms generally applied in such types of agreements.
The Company renders such telecommunications services as data transmission, voice services and Internet access for institutional customers.
In Netia’s opinion the execution of the Agreement constitutes confidential information for the purposes of Art. 154 of the Act on Trading in Financial Instruments dated 29 July 2005 (Journal of Laws 183, item 1538; the amended and restated version dated 8 October 2010, Journal of Laws No. 211, item 1384).
Moreover, the management board of Netia announces that the disclosure of the information concerning the fact of conduct of negotiations was delayed on September 13, 2011 in compliance with Art. 57, section 1 of the Act on Public Offering, the Conditions Governing the Introduction of Financial Instruments to Organized Trading, and Public Companies, because the disclosure thereof could violate the reasonable interests of the issuer since it would constitute disclosure of information concerning the negotiations conducted by the issuer, or the circumstances related therewith, the disclosure of which to the public could adversely impact the course or the outcome of the negotiations.
The financial and operating results forecast of Netia for the financial year 2011 remain unchanged and do not take account of an effect of a potential closing of the transaction as early as in 2011. The prevailing mid-term forecast of Netia remain unchanged until the closing of the transaction, whereafter this forecast will be revised. A pro forma effect of the transaction on the Netia group's operations is disclosed in a presentation available on Netia's website.
Legal basis: Art. 56, section 1.1 and Art. 57, section 3 of the Act on Public Offering, the Conditions Governing the Introduction of Financial Instruments to Organized Trading, and on Public Companies.
Teleconference regarding the take over of Crowley Data Poland
Netia will hold a teleconference regarding the transaction of acquisition of Crowley Data Poland on Monday, 3 October 2011, at 11.00 a.m. Warsaw time. The dial-in numbers for the teleconference are: (UK) +44 20 3003 2666 / (USA) +1 212 999 6659. A telephone record of the teleconference will be available soon after the completion thereof at: (UK) +44 20 8196 1998, dial-in code: 8271789#. The audio record of the teleconference will also be placed on Netia’s website dedicated to investors at www.inwestor.netia.pl. Additionally, a presentation concerning the above transaction is already available on Netia’s website at www.inwestor.netia.pl.
Under the Agreement the purchase price of the Shares will amount to USD 31.8 million (thirty-one million eight hundred thousand US dollars), established as the Enterprise Value, including the value of the loan as of the transaction closing date, extended to the Company by an entity related to the Seller, such loan being also subject to repayment by Netia. The price for the Shares will be additionally adjusted by the difference in the Company’s balance sheet existing on 31 December 2010 and on the transaction closing date. Since the parties had previously agreed all the principal elements enabling the establishing of the purchase price, on 16 September 2011, Netia executed a foreign exchange risk hedging transaction at the USD/PLN exchange rate of PLN 3.14 per USD 1.00. Consequently, Netia expects to close the transaction for a total sum of PLN 100 million (including the repayment of the loan extended to the Company) regardless of the exchange rate differences existing today and on the transaction closing date.
The closing of the transaction depends on the satisfaction of a condition precedent consisting of Netia obtaining consent from the anti-monopoly authority for the merger within six months from the date of the execution of the agreement; such deadline can be extended to nine months from the date of execution of the Agreement.
The Agreement contains representations and warranties of the Sellers customary for such types of transactions, and those specifically regarding the title to Shares and the condition of the Company’s enterprise as well as the Seller’s liability for warranty inaccuracy. The terms of the Agreement comply with the market practice and in line with the terms generally applied in such types of agreements.
The Company renders such telecommunications services as data transmission, voice services and Internet access for institutional customers.
In Netia’s opinion the execution of the Agreement constitutes confidential information for the purposes of Art. 154 of the Act on Trading in Financial Instruments dated 29 July 2005 (Journal of Laws 183, item 1538; the amended and restated version dated 8 October 2010, Journal of Laws No. 211, item 1384).
Moreover, the management board of Netia announces that the disclosure of the information concerning the fact of conduct of negotiations was delayed on September 13, 2011 in compliance with Art. 57, section 1 of the Act on Public Offering, the Conditions Governing the Introduction of Financial Instruments to Organized Trading, and Public Companies, because the disclosure thereof could violate the reasonable interests of the issuer since it would constitute disclosure of information concerning the negotiations conducted by the issuer, or the circumstances related therewith, the disclosure of which to the public could adversely impact the course or the outcome of the negotiations.
The financial and operating results forecast of Netia for the financial year 2011 remain unchanged and do not take account of an effect of a potential closing of the transaction as early as in 2011. The prevailing mid-term forecast of Netia remain unchanged until the closing of the transaction, whereafter this forecast will be revised. A pro forma effect of the transaction on the Netia group's operations is disclosed in a presentation available on Netia's website.
Legal basis: Art. 56, section 1.1 and Art. 57, section 3 of the Act on Public Offering, the Conditions Governing the Introduction of Financial Instruments to Organized Trading, and on Public Companies.
Teleconference regarding the take over of Crowley Data Poland
Netia will hold a teleconference regarding the transaction of acquisition of Crowley Data Poland on Monday, 3 October 2011, at 11.00 a.m. Warsaw time. The dial-in numbers for the teleconference are: (UK) +44 20 3003 2666 / (USA) +1 212 999 6659. A telephone record of the teleconference will be available soon after the completion thereof at: (UK) +44 20 8196 1998, dial-in code: 8271789#. The audio record of the teleconference will also be placed on Netia’s website dedicated to investors at www.inwestor.netia.pl. Additionally, a presentation concerning the above transaction is already available on Netia’s website at www.inwestor.netia.pl.