SNAK..$3.62.. Acquisition
SnackTime, one of the UK's largest national operators of snack and chilled drink
vending machines, is pleased to announce that it has agreed the acquisition of
the entire issued share capital of Vendia UK, for a maximum consideration of
GBP10.98 million. SnackTime expects the Acquisition to be earnings enhancing in
the year ending 31 March 2012.
Vendia UK's core operation is a traditional vending business specialising in the
sale of hot beverages, which complements SnackTime's confectionery and chilled
drinks operations. Vendia trades under brands such as Simply Drinks in London,
Integer in the Midlands, VMI in the north of England and Drinkmaster, a national
table top and in cup specialist company, based in Plymouth.
For the year ended 31 December 2009, Vendia UK reported audited revenues of
GBP19.7 million and adjusted EBITDA under IFRS of GBP2.1 million.
The consideration payable to the vendors of Vendia UK comprises:
&3; 5,447,855 new ordinary shares of 2p each in the Company ("New Ordinary
Shares"), which will represent 29.9 per cent. of SnackTime's enlarged share
capital following completion of the Acquisition. Pursuant to the terms of the
sale and purchase agreement, the New Ordinary Shares are the subject of lock-in
arrangements for 24 months from issue, and Vendia UK's major shareholder has
agreed to a lock in of a further 12 months;
&3; 1,816,557 million warrants exercisable into new ordinary shares of 2p
each in the Company ("Warrants"), exercisable at a price of 2p per share, further details of which are set out below; and &3; deferred consideration of GBP0.5 million in cash, payable in two tranches
of GBP250,000 on 31 December 2010 and 30 June 2011.
SnackTime will also assume term debt of approximately GBP2.4 million with
Co-Operative Bank plc as a result of the Acquisition.
The Acquisition is in line with SnackTime's strategic objective to increase its
critical mass and substantially improve its hot beverage offering. Following the
Acquisition, the enlarged Group will have over 30,000 customers being serviced
by more than 450 employees, agents and franchisees and will be the UK's fourth
largest vending company by revenue. The Board of SnackTime believes that the
Acquisition provides additional benefits and opportunities to the Group,
including:
&3; Cross-selling opportunities across all product ranges;
&3; Improved operational and cost efficiencies;
&3; Reduced combined overheads; and
&3; The development of a comprehensive in-house hot beverages offering.
The New Ordinary Shares will when issued rank pari passu with the Company's
existing ordinary shares of 2p each. Application has been made to London Stock
Exchange plc for the New Ordinary Shares to be admitted to trading on AIM, which
is expected to become effective on 27 September 2010.
The Warrants cannot be exercised for a period of three years from the date of
issue, nor at any time thereafter if doing so would breach the AIM Rules for
Companies, be in contravention of the Companies Act 2006 or result in the
holder(s) having to make an offer for the Company pursuant to Rule 9 of the City
Code on Takeovers and Mergers (the "City Code"). If any of these situations were
to arise, the Warrants would be exchanged for Convertible Unsecured Loan Notes
("CULs") which would not pay any interest and could not be converted for ten
years from their issue, nor at any time thereafter if doing so would result in
the holder(s) having to make an offer for the Company pursuant to Rule 9 of the
City Code, in which case the CULs would be exchanged for loan notes which would
not pay any interest.
Board Changes
As a result of the Acquisition, and taking into consideration the nature of the
enlarged Group, SnackTime believes that it is appropriate to introduce a new
executive management board which will report to the board of directors of
SnackTime (the "Board") and, as such, the following changes are being made to
the Board:
&3; Michiel Slinkert joins the Board as a non-executive Director. Michiel
has
been a non executive director of Vendia since 1997;
&3; Tim James joins the Board as Chief Financial Officer. Tim is finance
director of Snack in the Box Limited, which was acquired by SnackTime in
September 2009;
&3; Ian Forde, who is currently the executive Director responsible for
Brand Development, becomes a non-executive Director and will continue to assist the Company's brand relationships; &3; Julia Brand, who has been Finance Director since December 2007, is to step down from the Board and join the management board as Business Systems Director; and &3; Andy Fisher, Sales Director, will step down from the Board and join the
management board.
These changes will be effective immediately following completion of the
Acquisition.
Blair Jenkins, Chief Executive, of SnackTime, commented:
"Vendia's business is an ideal strategic fit with SnackTime and its exposure and
expertise in the hot drinks market perfectly complements our existing snacks and
chilled food operations. The combined Group will have an extensive footprint
throughout the UK and Ireland, providing excellent cross-selling opportunities
and even greater awareness for our brand partners. This is a significant
milestone in the Company's evolution and is a major step towards our goal of
becoming Europe's leading snack, chilled and hot beverage vending solution
provider.
"I would like to welcome Michiel and Tim to the Board of Directors and look
forward to being able to draw on their experience. I would also like to thank
Julia and Andy for their counsel to the Board and look forward to their
continued contribution to the Group."
For further information:
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| SnackTime plc | 0118 977 3344 |
| Blair Jenkins, Chief | |
| Executive | |
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| Arbuthnot Securities | 020 7012 2000 |
| Tom Griffiths | |
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| Threadneedle Communications | 020 7653 9844 |
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| Josh Royston / Graham Herring | |
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