Recommended Public Exchange Offer by Cap Gemini for Transiciel
Paris, October 20, 2003
Cap Gemini today announced the filing of a public exchange
offer to acquire all of the outstanding share capital of Transiciel.
The offer has been recommended by the Board of Directors of
Transiciel, as well as by its principal shareholder, Mr. Georges
Cohen, who has agreed to tender his entire shareholding to
the offer.
In acquiring Transiciel, Cap Gemini is furthering the implementation
of its development strategy in its core businesses by:
- strengthening its position in the Local Professional Services
market, which represents 20% of the IT services market in
Europe;
- complementing Sogeti’s geographic footprint in the
Benelux countries, as well as reinforcing its presence in
France and Spain;
- extending the range of its service offering with the addition
of Transiciel’s “R & D outsourcing”
service line.
Upon completion of the offer, Sogeti/Transiciel will boast
over 13,000 employees across 9 countries (including 1,200
in the United States) with combined pro forma revenues in
2002 in excess of €1.1bn.
The new grouping, headed by Messrs. Georges Cohen and Luc-Francois
Salvador (Sogeti’s currrent Managing Director), will
become the European reference in the Local Professional Services
market and will be well positioned to capitalise on the expected
recovery in the IT services sector.
Paul Hermelin, Chief Executive of Cap Gemini Ernst &
Young Group, commented: “This acquisition is in
line with the Group’s strategy. Cap Gemini wishes to
be in a position to offer its clients local professional services
as well as global solutions adapted to meet their specific
requirements. The shared principles in organisational structure
and management systems are a decisive advantage for this immediately
operational new group. Its growth and high margin potential
should benefit the entire Cap Gemini Ernst & Young Group.
We have set ambitious performance targets for the next two
years for Georges Cohen and Luc-Francois Salvador and I am
wholly confident that they will meet and even surpass them.”
Key terms of the Offer
The transaction will take the form of a public exchange offer
whereby Transiciel shareholders are invited by Cap Gemini
to tender and exchange their shares under either of the following
options:
Option 1: an exchange ratio of 1 new Cap Gemini share
issued for every 3 Transiciel shares;
Option 2: an exchange ratio of 5 Cap Gemini shares to
be issued, plus 16 warrants giving entitlement for up to
1 new Cap Gemini share, for 16 Transiciel shares;
Option 2 includes an earn-out mechanism which would allow
Transiciel shareholders to receive additional Cap Gemini shares
subject to the Sogeti/Transiciel grouping attaining certain
operating performance targets over the next two years.
Transiciel shareholders will be able to choose either option
or any combination of the two.
The number of additional Cap Gemini shares which may be issued
under Option 2 is capped at 20% of the initial number of shares
issued to Transiciel shareholders having tendered their shares
under Option 2.
On the basis of an exchange ratio of 3 Transiciel shares
for 1 Cap Gemini share and on the basis of Cap Gemini’s
closing share price of €38.87 on 17th October 2003, the
offer values each Transiciel share at €12.96, a premium
of 23.1% over Transiciel’s one-month average share price.
The offer is subject only to Cap Gemini shareholder approval,
as well as to an acceptance threshold of 66.67% of Transiciel’s
shares and voting rights existing as of the close of the tender
offer period.This offer is presented by Lazard Frères
Banque, financial advisor to Cap Gemini, and by Société
Générale, co-sponsoring banker. Rothschild &
Cie acted as Transiciel’s financial advisor.
Indicative timetable for the offer
Cap Gemini’s offer was filed with the Paris stock exchange
authorities on October 20, 2003. Subject to all required approvals,
the transaction is expected to be completed by the end of
2003.
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Cap Gemini
The Cap Gemini Ernst & Young Group, of which Cap Gemini
is the parent company, is one of the world leaders in consulting,
IT services and outsourcing, and reported 2002 revenues over
7 billion euros, with total staff of around 50,000.
Transiciel
Transiciel is a European IT services and Engineering Company
offering a multi-specialist package for large businesses,
based on three complementary business segments: R & D
Outsourcing, Integration of Management Systems and Insourcing
& Administration of Systems and Networks.The press release
referred to under Section 6 of COB regulation 2002-04 has
been issued and is available on the COB website (www.cob.fr)
and on the Cap Gemini Ernst & Young website (www.cgey.com).
According to Section 7 of COB regulation n°2002-04, this
press release has been submitted to the COB prior to distribution.
* * *
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