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    BETF   GB00B44JTH01

BETFAIR GROUP LTD

(BETF)
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Betfair : Circular and Notice of General Meeting

12/31/2014 | 03:51am EDT



12 December 2014

FOR IMMEDIATE RELEASE

TERMS OF PROPOSED RETURN OF CASH TO SHAREHOLDERS AND POSTING OF CIRCULAR

Betfair Group plc ("Betfair") announced on 4 December 2014 the return to shareholders of approximately £200 million.

Summary

·    The return amounts to £1.89 per existing ordinary share and will be implemented by way of a B share scheme - giving shareholders the ability to elect for income and/or capital

·    A share consolidation of 7 new ordinary shares for every 8 existing ordinary shares will allow comparability of the share price before and after the return

·     Circular to be posted today to shareholders

·     Shareholder approval will be sought at a General Meeting to be held at 11.00 a.m. on 9 January 2015

Posting of Circular

A shareholder circular (the "Circular") containing the full terms and conditions of the return of cash, further details of the proposed clarification to Breon Corcoran's joining share award announced on 4 December 2014, a notice convening the General Meeting and instructions to Shareholders on how to make an election for the form in which they wish to receive their proceeds, together with an election form and a proxy form, are expected to be posted to shareholders later today. The Circular will also be available at the Company's website at . A copy of the Circular will be submitted to the National Storage Mechanism and will shortly be available for inspection at: http://www.hemscott.com/nsm.do.

Terms used in this announcement but which are otherwise undefined shall have the same meanings as set out in the Circular.

This summary should be read in conjunction with the full text of the announcement, including the cautionary statements therein, and the Circular.

Enquiries:

Betfair Group plc

Paul Rushton, Investor Relations

Tel: +44 20 8834 6139


Jefferies International Limited

Neil Collingridge

Max Jones

Tel: +44 (0)20 7029 8000

Computershare Shareholder Helpline

Tel: 0870 707 4010 (or +44 (0)870 707 4010 if calling from outside the United Kingdom)

The Shareholder helpline is available between 8.30 a.m. and 5.30 p.m. on any Business Day. Calls to 0870 707 4010 are charged at 10 pence per minute plus network extras. Calls to +44 (0)870 707 4010 from outside the United Kingdom are charged at applicable international rates.  Please note that calls may be monitored or recorded and that Computershare will not provide advice on the merits of the Return of Cash nor give any financial or tax advice.



PROPOSED RETURN OF CASH TO SHAREHOLDERS

Betfair Group plc ("Betfair" or the "Company") announces today the terms of the return to Betfair shareholders ("Shareholders") of approximately £200 million (the "Return of Cash"). The Return of Cash will be implemented by way of a B share scheme.

Key elements of the proposed Return of Cash:

·     Shareholders, subject to restrictions in respect of Shareholders with a registered address in a Restricted Territory or who are resident or located in a Restricted Territory (being any of the United States, Canada, Australia, Japan and New Zealand) (together, "Restricted Shareholders"), can elect to receive their cash proceeds of £1.89 per Existing Ordinary Share as (i) an income payment (the "B Share Dividend"), (ii) a capital payment (the "Purchase Offer"), or (iii) a combination of both;

·     Shareholders who do not make a valid election, and all Restricted Shareholders, will be deemed to have elected for the B Share Dividend in respect of ALL of their entitlement under the Return of Cash;

·     the Return of Cash is conditional upon shareholder approval, which will be sought at a general meeting of the Company to be held at 11.00 a.m. on 9 January 2015 (the "General Meeting");

·     the latest time and date for receipt of Shareholders' elections is 5.00 p.m. on 21 January 2015;

·     cheques are expected to be despatched to Shareholders and payment by BACS are expected to be made by 27 January 2015 for the B Share Dividend; and

·     cheques are expected to be despatched to Shareholders and CREST accounts are expected to be credited by 27 January 2015 for the Purchase Offer.

Capital Reorganisation

Under the Return of Cash, for every 8 Existing Ordinary Shares held on 6.00 p.m. on 9 January 2015 (the "Capital Reorganisation Record Date") Shareholders will receive:

·     8 B shares; and

·     7 new ordinary shares ("New Ordinary Shares").

This mechanism is required to effect the Return of Cash and is referred to in the Circular as the "Capital Reorganisation". This will comprise an intermediate step under which each existing ordinary share (the "Existing Ordinary Shares") will be split into one intermediate ordinary share (the "Intermediate Ordinary Shares") and one B share. This will be followed immediately by the Intermediate Ordinary Shares being consolidated and sub-divided into New Ordinary Shares on a 7-for-8 basis.

The total amount of the Return of Cash is equivalent to approximately 12.7 per cent. of the market capitalisation of the Company at the close of business 10 December 2014. Following the Capital Reorganisation, the number of New Ordinary Shares in issue (as against the number of Existing Ordinary Shares previously in issue) will have been reduced by approximately the same percentage. The intention is that, subject to market movements between the date of the Circular and the Capital Reorganisation Record Date, the share price of one New Ordinary Share immediately after they are admitted to trading on the main market of the London Stock Exchange should be approximately equal to the share price of one Existing Ordinary Share on the Capital Reorganisation Record Date. The Board believes it is appropriate to consolidate the Company's share capital as this will allow comparability of the Company's share price before and after the Return of Cash. Shareholders will own the same proportion of the Company as they did beforehand, subject to fractional entitlements.

The Capital Reorganisation is further described in paragraph 2 of Part IV of the Circular.

THE B SHARE CHOICES

With the exception of Restricted Shareholders, Shareholders will have the ability to elect whether to receive their cash proceeds under the Return of Cash as income, capital or a combination of both. Each of the B Share Choices will return £1.89 of cash per Existing Ordinary Share.

Shareholders who do not make a valid election, and all other Restricted Shareholders, will be deemed to have elected for the B Share Dividend in respect of ALL of their entitlement under the Return of Cash. 

Choice 1: B Share Dividend

Shareholders who choose (or are deemed to choose) this option in respect of their B Shares, will receive a single dividend of £1.89 for each B Share they receive, which will be declared and become payable on 23 January 2015 (the "B Share Dividend"). Following declaration of the B Share Dividend, the B Shares on which it has been paid will automatically convert into deferred shares (the "Deferred Shares") with, in practice, no economic or other rights. The Deferred Shares will then be acquired from Shareholders (without any further action from such Shareholders) for no value following the Return of Cash and will subsequently be cancelled.

Choice 2: Purchase Offer

Shareholders who choose this option in respect of their B Shares, will have their B Shares purchased for £1.89 each by Jefferies International Limited ("Jefferies"), acting as principal (and not as agent, nominee or trustee), free of all dealing expenses and commissions, on 22 January 2015.

The B Share Choices summarised above are explained in further detail in paragraph 3 of Part IV of the Circular. Shareholders should read the Circular in full.

EXPECTED TIMETABLE OF PRINCIPAL EVENTS

Latest time and date for receipt of Form of Proxy for General Meeting

11.00 a.m. on 7 January 2015

Entitlement to speak and vote at the General Meeting set by reference to the register of members of the Company

6.00 p.m. on 7 January 2015

General Meeting

11.00 a.m. on 9 January 2015

Latest time and date for dealings in Existing Ordinary Shares. Share register of Existing Ordinary Shares closed and Existing Ordinary Shares disabled in CREST

4.30 p.m. on 9 January 2015

Capital Reorganisation Record Date

6.00 p.m. on 9 January 2015

Admission of New Ordinary Shares to the Official List and to trading on the London Stock Exchange's market for listed securities

8.00 a.m. on 12 January 2015

Dealings in the New Ordinary Shares commence. New Ordinary Shares entered into CREST and CREST accounts credited with "interim CREST entitlements" in respect of B Shares

8.00 a.m. (or as soon as possible thereafter) on 12 January 2015

Latest time and date for receipt of Forms of Election and USE Instructions in relation to the B Share Choices

5.00 p.m. on 21 January 2015

Jefferies makes the Purchase Offer by means of a Regulatory Information Service announcement

8.00 a.m. on 22 January 2015

Purchase of B Shares by Jefferies to be completed and Jefferies to be registered as the holder of such B Shares

By 12 noon on 22 January 2015

B Share Dividend Record Time

6.00 p.m. on 22 January 2015

B Share Dividend declared and becomes payable. B Shares automatically convert into Deferred Shares

By 11.59 p.m. on 23 January 2015

Despatch of New Ordinary Share certificates. Credit CREST accounts and despatch cheques in respect of the B Shares purchased under the Purchase Offer. Make BACS payments and despatch cheques in respect of the B Share Dividend. Credit CREST accounts and despatch cheques in respect of the sale of fractional entitlements.

By 27 January 2015

Notes:

All time references above are to London time.

These dates are given on the basis of the Board's current expectations and are subject to change. If any of the above times and/or dates change, the revised times and/or dates will be notified to Shareholders by announcement through a Regulatory Information Service and will be available on .

TAX

Shareholders should read Part VII of the Circular, which outlines the different UK tax consequences of the B Share Choices. It is important to note that the tax consequences for Shareholders will depend on the particular Shareholder's facts and circumstances. As such the information set out in Part VII of the Circular is intended for guidance only. Shareholders who are in any doubt as to their tax position or who are subject to tax in a jurisdiction other than the United Kingdom should consult an appropriate professional adviser.

On 3 December 2014 the Government announced its intention to introduce legislation in the Finance Bill 2015 to change the tax treatment of returns made to certain individual shareholders through B share schemes. Draft legislation was published on 10 December. If enacted, the new legislation would mean that all returns made to such shareholders after 6 April 2015 pursuant to certain 'special purpose' share schemes would be taxed as though they were dividends. On the basis that, as currently drafted, the proposed legislation applies only in relation to amounts received after 6 April 2015, it should not apply to Shareholders participating in the Return of Cash. Shareholders should note, however, that the legislation is in draft form, and there is no guarantee that it will be enacted without amendment.

AMENDMENT TO BREON CORCORAN'S JOINING AWARD

Separately, at the General Meeting Shareholders will also be asked to approve a clarification of the performance conditions attaching to the Joining Award relating to the Company's CEO, Breon Corcoran. Following extensive consultation with Shareholders, it is proposed that the performance conditions are amended so as to remove the TSR component. This addresses a discrepancy between the understanding reached with Mr. Corcoran at the time of his recruitment and the subsequent option that was granted. The background to, and the reasons for, the proposed amendment are set out in Part VIII of the Circular.

RECOMMENDATION TO SHAREHOLDERS

The Board has received advice from Jefferies in relation to the resolutions to be proposed at the General Meeting (the "Resolutions"). In providing their advice to the Board, Jefferies has taken into account the Board's commercial assessment of the Resolutions.

Your Board is of the opinion that the Resolutions to be proposed at the General Meeting are in the best interests of Shareholders as a whole. Accordingly, your Board unanimously recommends that you vote in favour of the Resolutions, as the Directors intend to do in respect of their own beneficial holdings amounting in aggregate to 292,827 Existing Ordinary Shares representing approximately 0.277 per cent. of the total issued share capital of the Company at 10 December 2014 except in relation to the Resolution in relation to the proposed clarification of the performance conditions attaching to the Joining Award, in respect of which Breon Corcoran will abstain from voting.



Cautionary Statements

This announcement does not constitute, or form part of, an offer to sell or the solicitation of an offer to subscribe for any securities, nor the solicitation of any vote or approval in any jurisdiction, nor shall there be any sale, issue or transfer of the securities referred to in this announcement in any jurisdiction in contravention of applicable law.

No application will be made to the UK Listing Authority or to the London Stock Exchange, respectively, for any of the B Shares or Deferred Shares to be admitted to the Official List or to trading on the London Stock Exchange's main market for listed securities, nor will the B Shares or Deferred Shares be listed or admitted to trading on any other recognised investment exchange.

None of the B Shares, Deferred Shares or the New Ordinary Shares have been or will be registered under the United States Securities Act of 1933 or the state securities laws of the United States and none of them may be offered or sold in the United States unless pursuant to a transaction that has been registered under the United States Securities Act of 1933 and the relevant state securities laws or a transaction that is not subject to the registration requirements of the United States Securities Act of 1933 and the state securities laws, either due to an exemption therefrom or otherwise.

None of the B Shares, Deferred Shares, New Ordinary Shares or this announcement has been approved, disapproved or otherwise recommended by any US federal or state securities commission or other regulatory authority or any non-US securities commission or regulatory authority nor have such authorities passed upon or endorsed the merits of this offering or confirmed the accuracy or determined the adequacy of this announcement. Any representation to the contrary is a criminal offence in the United States.

This announcement includes statements that are, or may be deemed to be, "forward looking statements". These forward looking statements can be identified by the use of forward looking terminology, including the terms "believes", "estimates", "plans", "projects", "anticipates", "expects", "intends", "may", "will", or "should" or, in each case, their negative or other variations or comparable terminology, or by discussions of strategy, plans, objectives, goals, future events or intentions. These forward looking statements include all matters that are not historical facts. They appear in a number of places throughout this announcement and include, but are not limited to, statements regarding the Group's intentions, beliefs or current expectations concerning, among other things, the Group's results of operations, financial position, prospects, growth, strategies and the industry in which it operates. By their nature, forward looking statements involve risk and uncertainty because they relate to future events and circumstances. Forward looking statements are not guarantees of future performance and the actual results of the Group's operations and financial position, and the development of the markets and the industry in which the Group operates, may differ materially from those described in, or suggested by, the forward looking statements contained in this announcement. In addition, even if the results of operations, financial position and the development of the markets and the industry in which the Group operates are consistent with the forward looking statements contained in this announcement, those results or developments may not be indicative of results or developments in subsequent periods. A number of factors could cause results and developments to differ materially from those expressed or implied by the forward looking statements including, without limitation, general economic and business conditions, industry trends, competition, changes in regulation, currency fluctuations, changes in its business strategy, political and economic uncertainty and other factors. Statements contained in this announcement regarding past trends or activities should not be taken as a representation that such trends or activities will continue.

Forward looking statements may, and often do, differ materially from actual results. Any forward looking statements in this announcement speak only as of their respective dates, reflect the Group's current view with respect to future events and are subject to risks relating to future events and other risks, uncertainties and assumptions relating to the Company's operations, results of operations and growth strategy. You should specifically consider the factors identified in this announcement which could cause actual results to differ before making any decision in relation to the Return of Cash. Subject to the requirements of the Financial Conduct Authority, the London Stock Exchange, the Listing Rules and the Disclosure and Transparency Rules (and / or any regulatory requirements) or applicable law, the Company explicitly disclaims any obligation or undertaking publicly to release the result of any revisions to any forward looking statements in this announcement that may occur due to any change in the Company's expectations or to reflect events or circumstances after the date of this announcement.

Jefferies International Limited is acting exclusively for the Company and no-one else in connection with the Return of Cash and will not be responsible to anyone other than the Company for providing the protections afforded to clients of Jefferies International Limited or for providing advice in relation to the Return of Cash or in relation to the contents of this Circular of any transaction or other matter referred to herein.

This announcement has been issued by, and is the sole responsibility of, the Company.

The release, publication or distribution of this announcement in jurisdictions other than the United Kingdom may be restricted by law and, therefore, any persons who are subject to the laws of any jurisdiction other than the United Kingdom should inform themselves about, and observe, any applicable requirements.


This information is provided by RNS
The company news service from the London Stock Exchange
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