Interquest : Chisbridge Limited - Cash Offer for InterQuest Group PLC

RNS Number : 4841F

Chisbridge Limited

18 May 2017

Not for release, publication or distribution, in whole or in part, directly or indirectly, in, into or from any jurisdiction where to do so would constitute a violation of the relevant laws or regulations of such jurisdiction.

FOR IMMEDIATE RELEASE

CASH OFFERby CHISBRIDGE LIMITED ("Chisbridge") for INTERQUEST GROUP PLC ("InterQuest")

Summary 18 May 2017

· Further to its announcement on 16 May 2017, the Board of Chisbridge announces that it intends to make a cash offer, with a loan note alternative, for the whole of the issued and to be issued share capital of InterQuest ("Offer").

· Chisbridge is a new company that has been set up by Gary Ashworth, Christopher Eldridge and David Bygrave, who are all directors of InterQuest, ("Management Team") for the purposes of making the Offer.

· Under the terms of the Offer, which is subject to the terms and further conditions set out in Appendix I of this Announcement, InterQuest Shareholders will be entitled to receive:

For each InterQuest Share: 42 pence in cash ("Offer Price")

· The Offer values the existing issued share capital of InterQuest at approximately £15.8 million.

· The Offer Price represents a premium of approximately:

• 9.37 per cent. to the Closing Price per InterQuest Share of 38.4 pence on 15 May 2017 (being the last Business Day prior to the commencement of the Offer Period); and

• 14.85 per cent. to the average Closing Price per InterQuest Share of 36.57 pence, being the average Closing Price per InterQuest Share on each of the Business Days in the three months prior to 15 May 2017 (being the last Business Day prior to the commencement of the Offer Period).

· Chisbridge has decided to offer an unguaranteed and unsecured loan note alternative to the Cash Offer in the form of the Loan Notes. InterQuest Shareholders must elect to accept wither the Cash Offer or the Loan Note Alternative in respect of their entire holding of InterQuest Shares.

· Chisbridge has received an irrevocable undertaking and letters of intent to accept the Offer in respect of a total of 15,874,328 InterQuest Shares representing approximately 42.2 per cent. of the InterQuest Shares.

· The Offer is subject to an acceptance condition at a level of Chisbridge needing to acquire or agree to acquire (whether pursuant to the Offer or otherwise) InterQuest Shares representing more than 50 per cent. of the voting rights then normally exercisable at a general meeting of InterQuest. Chisbridge intends, upon the Offer becoming wholly unconditional and subject to Chisbridge then owning 75 per cent. of the InterQuest Shares, to take the necessary actions to cancel the admission to trading on AIM of the InterQuest Shares and re-register InterQuest as a private limited company. The net result of these actions would be for InterQuest to become a private company with no ability for those InterQuest Shareholders who have not accepted the Offer to trade their InterQuest Shares in the future on a public trading platform.

· Save in respect of the second interim dividend announced by InterQuest on 14 March 2017 to be paid on 16 June 2017 to InterQuest Shareholders on the register on 19 May 2017 (the "Announced Dividend"), which InterQuest Shareholders will be entitled to receive and retain in addition to the Offer consideration, Chisbridge will have the right to reduce the Offer consideration by the amount of any dividend (or other distribution) which is paid or becomes payable by InterQuest to InterQuest Shareholders.

Commenting on the Offer, Gary Ashworth, Chairman of Chisbridge said:

"The Management Team believes the continued volatility of InterQuest's share price and the disproportionate effect of negative news on its share price has negatively impacted the perception of InterQuest by clients and staff. The markets in which InterQuest operates have seen intense competition and we believe its performance remains subject to wider economic sentiment which is difficult to forecast due to Brexit uncertainties. Any negative impact on business confidence is likely to affect hiring decisions which could lead to short-term trading challenges for InterQuest.

As a people business, the ability to use equity to incentivise and motivate the employees who deliver revenue is, in our opinion, vital for success. Share price volatility has defeated one of the core reasons for remaining on AIM, namely to attract, motivate and retain staff of an appropriate calibre through share options and share ownership. A number of key personnel who are optionholders and shareholders of InterQuest have expressed concern about its share price performance and the continuance of its admission to AIM. We believe InterQuest will have a greater chance of attracting, retaining and incentivising key personnel with bonus and share option arrangements which would not comply with corporate governance guidelines for a publicly quoted company.

In these circumstances we believe InterQuest's stakeholders' interests would better be protected if it were a private company."

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