Essar Energy : Extension of Offer now closed

NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN WHOLE OR IN PART, IN, INTO OR FROM ANY JURISDICTION WHERE TO DO SO WOULD CONSTITUTE A VIOLATION OF THE RELEVANT LAWS OF THAT JURISDICTION  

FOR IMMEDIATE RELEASE

23 May 2014

ENERGY BIDCO HOLDINGS LIMITED

an indirect wholly-owned subsidiary of

ESSAR GLOBAL FUND LIMITED

PROPOSED ACQUISITION OF ESSAR ENERGY PLC

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Extension of Shares Offer and Bonds Offer now closed

Introduction

On 14 March 2014, Essar Capital Limited, the dedicated investment manager for Essar Global Fund Limited ("EGFL "), announced a proposed cash acquisition by an indirect wholly-owned subsidiary of EGFL, Energy Bidco Holdings Limited ("Bidco "), of the minority shares in Essar Energy plc ("Essar Energy ") that EGFL does not already own (the "Shares Offer ") and the US$550,000,000 4.25 per cent. convertible bonds due 2016 guaranteed by Essar Energy (the "Bonds Offer ", and together with the Shares Offer, the "Acquisition ").

The full terms and conditions and the procedures for acceptances of the Shares Offer and the Bonds Offer were set out in the offer document published by Bidco on 11 April 2014 (the "Offer Document "), a copy of which is available at www.essarglobalfundltd.com. Terms and expressions used in this announcement shall, unless the context otherwise requires, have the same meanings as given to them in the Offer Document.

On 9 May 2014, Bidco declared both the Shares Offer and the Bonds Offer wholly unconditional and announced that it was keeping both the Shares Offer and the Bonds Offer open for acceptances until the next closing date, being 1.00 p.m. (London time) on 23 May 2014.

Extension of Shares Offer

Bidco is today announcing that the Shares Offer is being extended and will remain open for acceptance until the next closing date which will be 1.00 p.m. (London time) on 6 June 2014. Bidco is not under any obligation to extend the Shares Offer beyond 6 June 2014.  That being so, Essar Energy Shareholders who wish to be certain to accept the Shares Offer must do so by 1.00 p.m. (London time) on 6 June 2014.

Essar Energy Shareholders who do not accept the Shares Offer will remain as investors in a private company.  In addition, should the listing of Essar Energy be cancelled (see further below under 'Delisting'), the liquidity and marketability of Essar Energy Shares will be reduced significantly. 

Accordingly, Essar Energy Shareholders who have not yet accepted the Shares Offer are urged to do so as soon as possible. 

Bidco notes that on 13 May 2014, the Independent Committee announced that it had revised its recommendation to Essar Energy Shareholders and that Essar Energy Shareholders should now seriously consider accepting the Shares Offer.  The Second Independent Committee Circular was also published on 13 May 2014, which set out details in relation to the risks and uncertainties associated with delisting, re-registration and refinancing of Essar Energy.  A copy of the Second Independent Committee Circular is available at www.essarenergy.com.

Delisting

Bidco notes that Essar Energy has applied to the UK Listing Authority and the London Stock Exchange, respectively, for the cancellation of the listing of Essar Energy on the Official List and for the cancellation of admission to trading in Essar Energy Shares on the London Stock Exchange.  The cancellation of listing and admission to trading is expected to take effect on 10 June 2014 (after the next closing date which is 1.00 p.m. (London time) on 6 June 2014).

Further acceptances of the Shares Offer

The procedure for acceptance of the Shares Offer is set out on page 5 and in paragraph 15 of Part 1 of the Offer Document and, in the case of Essar Energy Shares in certificated form (that is, not in CREST), in the Form of Acceptance.  To accept the Shares Offer in respect of Essar Energy Shares in certificated form, the completed and signed Forms of Acceptance should be returned to Equiniti, the Receiving Agent.  Acceptances in respect of Essar Energy Shares in uncertificated form should be made electronically through CREST.  CREST sponsored member should note that only CREST sponsors will be able to send the necessary TTE instruction to Euroclear.

Bonds Offer now closed

As set out in the announcement made on 9 May 2014, the Bonds Offer would remain open for acceptances until 1.00 p.m. (London time) on 23 May 2014.  Accordingly, Bidco confirms that the Bonds Offer is now closed and is no longer capable of acceptance.

Level of acceptances

As at 1.00 p.m. (London time) on 23 May 2014, Bidco had received valid acceptances of the Shares Offer in respect of 267,511,087 Essar Energy Shares (representing approximately 20.52 per cent. of the total issued share capital of Essar Energy and approximately 93.24 per cent. of the Essar Energy Shares to which the Shares Offer relates).  In addition, EGFL already owns 1,016,534,221 Essar Energy Shares (representing approximately 77.99 per cent. of the total issued share capital of Essar Energy).

Accordingly, as at 1.00 p.m. (London time) on 23 May 2014, Bidco/EGFL either owned or had received valid acceptances of the Shares Offer in respect of, in aggregate, 1,284,045,308 Essar Energy Shares (representing approximately 98.51 per cent. of the total issued share capital of Essar Energy). 

Since the announcement made on 9 May 2014, Bidco has not received any further acceptances of the Bonds Offer or acquired any Essar Energy Convertible Bonds other than by way of settlement of valid acceptances in respect of the Bonds Offer. 

Accordingly, as at 1.00 p.m. (London time) on 23 May 2014, Bidco/EGFL either owned or had received valid acceptances of the Bonds Offer in respect of, in aggregate, 18,100,000 Essar Energy Convertible Bonds (representing approximately 3.29 per cent. of the outstanding Essar Energy Convertible Bonds). 

The acceptances received include acceptances received in respect of:

·          2,500 Essar Energy Shares (representing approximately 0.00019 per cent. of the total issued share capital of Essar Energy and approximately 0.00087 per cent. of the Essar Energy Shares to which the Shares Offer relates) which were held by Nigel Bell, a director of EGFL; and

·          6,400 Essar Energy Shares (representing approximately 0.00049 per cent. of the total issued share capital of Essar Energy and approximately 0.00223 per cent. of the Essar Energy Shares to which the Shares Offer relates) which were held by Bell Shipping Limited, a company owned by Nigel Bell and his close relatives.

Save as disclosed above, so far as Bidco is aware, none of the acceptances received have been from persons acting in concert with Bidco. 

Interests in Essar Energy Shares

As at 1.00 p.m. (London time) on 23 May 2014, Bidco and persons acting in concert with it had the following interests in or rights to subscribe for Essar Energy Shares:

Save as disclosed above, as at 1.00 p.m. (London time) on 23 May 2014, neither Bidco, nor any person acting in concert with it, is interested in, or has any rights to subscribe for any relevant securities of Essar Energy, or has any short position (whether conditional or absolute and whether in the money or otherwise), including any short position under a derivative or any arrangement in relation to any relevant securities of Essar Energy. For these purposes, "arrangement" includes any agreement to sell or any delivery obligation or right to require another person to purchase or take delivery of any relevant securities of Essar Energy and any borrowing or lending of any relevant securities of Essar Energy which have not been on-lent or sold and any outstanding irrevocable commitment or letter of intent with respect to any relevant securities of Essar Energy.

Settlement

As set out in the announcement made on 9 May 2014, settlement for valid acceptances in respect of the Shares Offer received after 9 May 2014 will be effected promptly after receipt of that acceptance in accordance with applicable English and US law and regulation and, in any event, within five Business Days of receipt of that acceptance.  As noted above, Bidco has not received any acceptances of the Bonds Offer since 9 May 2014.

Developments in Essar Energy

Bidco notes that on 19 May 2014, Essar Energy announced that the following directors of Essar Energy resigned with immediate effect: Mr Sattar Hajee Abdoula, Mr Philip Aiken AM, Mr Subhas C Lallah, Mr Steve Lucas, Mr Simon Murray CBE, Mr Prashant Ruia and Mr Ravi Ruia.

General

In accordance with Rule 30.4 of the Takeover Code, this announcement will be available on EGFL's website at www.essarglobalfundltd.com by no later than 12.00 noon (London time) on 27 May 2014.

Enquiries

VTB Capital, which is authorised by the Prudential Regulation Authority and regulated by the Prudential Regulation Authority and the Financial Conduct Authority in the United Kingdom, is acting exclusively for EGFL and Bidco and no one else in connection with the Acquisition and will not be responsible to anyone other than EGFL and Bidco for providing the protections afforded to clients of VTB Capital nor for giving advice in relation to the Acquisition or any matter or arrangement referred to in this announcement.

This announcement is not intended to, and does not, constitute or form part of any offer, invitation or the solicitation of an offer to purchase, otherwise acquire, subscribe for, sell or otherwise dispose of, any securities pursuant to the Acquisition or otherwise.  The Acquisition will be made solely by the Offer Document, which contains the full terms and conditions of the Shares Offer and the Bonds Offer, including details of how such offers may be accepted.

This announcement has been prepared in accordance with English law, the Takeover Code and the Disclosure and Transparency Rules and information disclosed may not be the same as that which would have been prepared in accordance with the laws of jurisdictions outside England.

The Acquisition will be subject to the applicable rules and regulations of the FCA, the London Stock Exchange and the Takeover Code.

The distribution of this announcement in jurisdictions other than the United Kingdom and the availability of the Acquisition to Essar Energy Shareholders and/or Essar Energy Convertible Bondholders who are not resident in the United Kingdom may be affected by the laws of relevant jurisdictions.  Therefore any persons who are subject to the laws of any jurisdiction other than the United Kingdom or Essar Energy Shareholders or Essar Energy Convertible Bondholders who are not resident in the United Kingdom will need to inform themselves about, and observe, any applicable requirements. The receipt of cash pursuant to the Acquisition by a holder of Essar Energy Shares and/or Essar Energy Convertible Bonds may be a taxable transaction for income tax purposes under foreign tax laws. Each holder of Essar Energy Shares and/or Essar Energy Convertible Bonds is urged to consult his independent professional adviser immediately regarding the tax consequences of acceptance of the Acquisition.

Unless otherwise determined by Bidco or EGFL or required by the Takeover Code and permitted by applicable law and regulation, the Acquisition is not being, and will not be, made, directly or indirectly, in or into or by the use of the mails of, or by any other means or instrumentality (including, without limitation, electronic mail, fax transmission, telephone, internet or other forms of electronic communication) of interstate or foreign commerce of, or any facility of a national state or other securities exchange of any Restricted Jurisdiction and will not be capable of acceptance by any such use, means, instrumentality or facility or from within  any Restricted Jurisdiction.

Accordingly, unless otherwise determined by Bidco or EGFL or required by the Takeover Code and permitted by applicable law and regulation, copies of this announcement are not being, and must not be, directly or indirectly, mailed, transmitted or otherwise forwarded, distributed or sent in, into or from any Restricted Jurisdiction and persons receiving this announcement (including, without limitation, custodians, nominees and trustees) must not mail or otherwise forward, distribute or send it in, into or from such jurisdiction.  Any person (including, without limitation, any custodian, nominee and trustee) who would, or otherwise intends to, or who may have a contractual or legal obligation to, forward this announcement, the Offer Document and/or any other related document to any jurisdiction outside the United Kingdom should inform themselves of, and observe, any applicable legal or regulatory requirements of their jurisdiction.

Notice to US holders

US holders should note that the Acquisition relates to the shares and bonds of non-US companies, is subject to UK disclosure requirements (which are different from those of the United States). The Acquisition is being made in the United States without being subject to the filing, disclosure and procedural requirements of Section 14(d) and Regulation 14D and other US tender offer rules under the United States Securities Exchange Act of 1934, as amended (the "Exchange Act ").

US holders should note that UK disclosure requirements are different from those of the US. The Acquisition is being made in accordance with the requirements of the Takeover Code. Accordingly, the Acquisition is subject to disclosure and other procedural requirements, including with respect to withdrawal rights and offer timetable, that are different from those applicable under US domestic tender offer procedures and law.

The receipt of cash pursuant to the Acquisition by a US holder of Essar Energy Shares and/or Essar Energy Convertible Bonds may be a taxable transaction for US federal income tax purposes and under applicable US state and local, as well as foreign and other tax laws. Each holder of Essar Energy Shares and/or Essar Energy Convertible Bonds is urged to consult his independent professional adviser immediately regarding the tax consequences of acceptance of the Acquisition.

It may be difficult for US holders of Essar Energy Shares and/or Essar Energy Convertible Bonds to enforce their rights and any claim arising out of the US federal securities laws, since EGFL, Bidco and Essar Energy are located in a non−US country, and some or all of their officers and directors may be residents of a non−US country. US holders of Essar Energy Shares and/or Essar Energy Convertible Bonds may not be able to sue a non−US company or its officers or directors in a non−US court for violations of the US securities laws. Further, although US holders are not waiving their rights under US federal laws by accepting the Shares Offer and/or the Bonds Offer, it may be difficult to compel a non−US company and its affiliates to subject themselves to a US court's judgment.

In accordance with normal UK practice and pursuant to Rule 14e−5(b) of the Exchange Act, EGFL, Bidco or their nominees or brokers (acting as agents) may from time to time make certain purchases of, or arrangements to purchase, Essar Energy Shares and/or Essar Energy Convertible Bonds outside the United States, other than pursuant to the Acquisition, before or during the period in which the Acquisition remains open for acceptance. These purchases may occur either in the open market at prevailing prices or in private transactions at negotiated prices. Such purchases or arrangements to purchase Essar Energy Shares and Essar Energy Convertible Bonds must comply with English law, the Takeover Code and other applicable law. Any information about such purchases will be disclosed as required in the UK and will be available via a Regulatory Information Service and will be available on EGFL's website by no later than 12 noon on the Business Day following it being made available via a Regulatory Information Service .