Swiss Jelmoli agrees with Swiss Prime Site on improved stock offer

Jelmoli Holding, the listed Swiss department stores group that recently split out foreign assets, has reached an agreement with Zurich-based listed peer Swiss Prime Site to recommend the SPS takeover bid which has been raised to 8.1 SPS shares for one Jelmoli share from a prior 7.7. The Jelmoli board has also executed a transaction agreement with SPS, which it now feels able to recommend to shareholders. This includes the increased offer, and extended protection for Jelmoli employees. It also ensures the continuation and development of the House of Brands department store on the Bahnhofstrasse in Zurich at least until end-2010. But the group added: "Jelmoli intends to work closely with SPS on the subject of financing while retaining the right to withdraw its recommendation if by the time of publication of the offer prospectus it has not obtained satisfactory comfort that the financing of existing financial indebtedness is assured." SPS announced on 2 June that it signed a purchase agreement with Pelham Investments, controlled by Georg von Opel, to acquire from Pelham all Jelmoli registered shares representing 29.9% of its capital. SPS then announced an exchange offer. On the basis of the closing SPS share price of 10 June of CHF51.95, it translates into a market value of CHF420.80 per Jelmoli share, a premium of 18% on the volume-weighted average share prices of both companies between 30 March and 29 May. Upon completion of the offer, remaining Jelmoli shareholders will have a share of 47% in the combined company. (Full story to be published in PFE 125 on 15 June)