Toscafund Asset Management LLP and Penta Capital made a preliminary and non-binding proposal to acquire remaining 70.9% stake in TalkTalk Telecom Group PLC (LSE:TALK) from Charles Dunston, Executive Chairman of TalkTalk, David PJ Ross, Jupiter Asset Management Limited, Capital Research Global Investors and others for approximately £790 million on October 8, 2020. Toscafund Asset Management LLP and Penta Capital (Tosca Penta) reached an agreement on the terms to acquire the remaining 70.9% in TalkTalk Telecom Group PLC from Charles Dunston, David PJ Ross, Jupiter Asset Management Limited, Capital Research Global Investors and others for approximately £790 million on December 17, 2020. Under the terms, 70.9% stake for £0.97 per share will be acquired. As an alternative to the cash offer, shareholders may elect to receive one unlisted ordinary share in the capital of the holding company (Offeror) created for this acquisition. Based on the offer price, the entire issued ordinary share capital of TalkTalk is valued at approximately £1.11 billion. The Tosca Investors beneficially own 29.5% stake in TalkTalk. It is intended that the acquisition will be implemented by means of a Court-sanctioned scheme of arrangement, however, the Offeror reserves the right to elect to implement the acquisition by way of a Takeover Offer. The cash consideration will be financed by up to £527 million of debt to be provided under the PIK Term Loan Facility Agreement. Tosca Penta is seeking to raise additional equity funds which it would manage/advise and which would be used either to subscribe for new Offeror ordinary shares and to fund the cash consideration and/or to repay amounts borrowed under the PIK Facility Agreement, or otherwise to acquire part of the Tosca Investors' investment in the Offeror that arises as a result of the Tosca Investors electing for the alternative offer. TalkTalk will be delisted once the Scheme becomes effective.

The Directors of the Offeror are Martin Hughes, Torquil Macnaughton and Steven Scott and the sole shareholder of the Offeror is currently Penta Investments GP Limited. If the Scheme becomes effective, it is expected that the Board of Directors of the Offeror will comprise Martin Hughes, Torquil Macnaughton and Steven Scott (each as an appointee of Tosca Penta), Charles Dunstone, John Gildersleeve and Roger Taylor (each as an appointee of Charles Dunstone), Tristia Harrison (as Chief Executive Officer), Phil Eayres (as Chief Financial Officer designate) and Paul Reynolds (as an independent non-executive director). The Independent TalkTalk Directors have confirmed that they will step down upon the Scheme becoming Effective. No significant changes in relation to the continued employment of the TalkTalk Group's employees and management are expected. Tosca Penta has no intention to redeploy the headquarters or fixed assets of TalkTalk and has no intention of altering the location of the TalkTalk Group's places of business.

The transaction is subject to (i) approval of Scheme Shareholders by a majority representing at least 75 per cent at the Court Meeting; (ii) the Resolutions being duly passed at the General Meeting; (iii) the sanction of the Scheme by the Court; and (iv) the Scheme becoming Effective no later than the Long Stop Date. The transaction is subject to approval of Charles Dunstone. The Court is expected to grant such permission at a hearing on February 3, 2021. Tosca Penta reserves the right to make an offer for the TalkTalk Telecom Group at a price less than 97 pence per share with the recommendation or consent of the board of the TalkTalk Telecom Group, if the TalkTalk announces, declares or pays any dividend or distribution to shareholders in which case Tosca Penta reserves the right to make an equivalent reduction to the offer price, if a third party announces a firm intention to make an offer for the TalkTalk on less favorable terms than the proposal or following the announcement by the TalkTalk of a whitewash transaction. Irrevocable undertakings to vote in favour of the scheme at the court meeting have been received from the Independent TalkTalk Directors, Charles Dunstone, Roger Taylor, Tristia Harrison, John Gildersleeve, and Timothy Morris and they represent a stake of approximately 44.66% in TalkTalk. The Independent Talktalk Directors intend to unanimously recommend the transaction. The offer period commenced, and Toscafund Asset Management is required to announce by November 5, 2020, intention to make an offer, and deadline can be extended. As of November 5, 2020, the deadline to file an offer was extended to December 3, 2020. As of December 3, 2020, the deadline to file an offer was extended to December 17, 2020. As of December 17, 2020, the offer has been accepted by TalkTalk Telecom Group PLC. As of February 5, 2021, TalkTalk Independent Directors have unanimously recommended the transaction. The Court Meeting and General Meeting will be held on March 1, 2021 and the Court Hearing will be held on March 10, 2021. As of March 1, 2021, the special resolutions were passed in the Court Meeting and General Meeting, and court approval is pending. As of March 10, 2021, High Court of Justice approved the transaction. It is expected that the Scheme will become effective in the first quarter of 2021. The long stop date is June 30, 2021. As of March 1, 2021, it is anticipated that the Scheme will become effective on March 12, 2021.

Robert Mayhew, Derek Shakespeare, Alex Evans, and Akshay Majithia of Barclays Bank Plc; James Arculus Matt Hall, David Ibanez and Anna Mills of Deutsche Bank AG, London Branch; and Cyrus Kapadia and Nicholas Page of Lazard & Co., Limited acted as financial advisors to TalkTalk Telecom Group PLC. A team led by Jonathan King and Michael Carter Osborne Clarke LLP acted as legal advisor to TalkTalk Telecom. Dominic Morley, Nick Lovering, and Alina Vaskina of Panmure Gordon (UK) Limited acted as financial advisor to Tosca Penta. Dickson Minto W.S. acted as legal advisor to Toscafund Asset Management LLP and Penta Capital. Ares Management Limited acted as arranger, agent and security agent to Tosca Penta. HSBC Holdings plc (LSE:HSBA) acted as a financial advisor to TalkTalk Telecom Group PLC. Equiniti Limited acted as registrar to TalkTalk Telecom Group. Robert Boyle, Mark Slade, Kirstie Hutchinson, and Ryan Moore of Macfarlanes LLP acted as legal advisor to Panmure Gordon. James Arculus Matt Hall, David Ibanez and Anna Mills of Deutsche Bank AG and Robert Mayhew, Derek Shakespeare, Alex Evans, and Akshay Majithia of Barclays Bank Plc acted as joint corporate broker to Toscafund Asset Management LLP and Penta Capital. O'Melveny & Myers, LLP, London Branch acted as legal advisor to Toscafund.