Elisa Bids for Saunalahti

Elisa will make a public share exchange offer for Saunalahti shares

July 8, 2005

2 Min Read

HELSINKI -- Elisa will make a public share exchange offer for all shares issued by Saunalahti Group Oyj. The combination of the businesses of Saunalahti and Elisa creates a bigger and more competitive Finnish operator in all customer segments. The combination will offer significant scope for increasing shareholder value through synergies and further growth opportunities.

Elisa will offer 1 Elisa share for each 5.6 Saunalahti shares during this share exchange offer. The calculated total value of the consideration offered by Elisa will be approximately 27 per cent higher than the average volume-weighted price of the Saunalahti shares traded in the last 12 months. Elisa will also make an offer for Saunalahti option holders, offering EUR 1.53 in cash for each share option of the 2002 option program, and EUR 1.82 in cash for each share option of the 2003 option program. The calculated total amount of the consideration offered by Elisa will be approximately EUR 320 million.

Certain large Saunalahti owners, i.e. Novator Finland Oy, Burdaras hf., Keaton Industries Corp and Ajanta Oy, whose holdings in Saunalahti Group Oyj amount to a total of approximately 50% of Saunalahti shares, have all undertaken to participate in Elisa’s share exchange offer.

The share exchange offer is estimated to commence at the end of August. The completion of the share exchange offer is subject to the approval of the authorities, among other conditions, and requires that Elisa’s ownership of Saunalahti shares and votes exceeds 2/3. The combined listing particulars and tender offer documents concerning this share exchange offer, and the terms and conditions of the offer will be published before the share exchange period begins. In addition, the commencement and implementation of the share exchange offer require that no significant changes disadvantageous in Elisa’s point of view and attributable to Saunalahti have taken place in Saunalahti’s business or financial status.

Elisa estimates that the synergy benefits that are to be achieved by this integration will amount to at least EUR 70 million a year and they will be realized in full as of the beginning of 2007. The effect of the share exchange offer to earnings per share before depreciation on new intangible assets will be negative in 2006 and positive as of 2007.

Should the share exchange offer be realized, Elisa’s Board of Directors will summon an extraordinary shareholders’ meeting to decide on two new Board members.

‘The deal is in line with Elisa’s strategy and enables us to offer Elisa and Saunalahti’s customers an even more comprehensive offering of innovative services than before. Saunalahti’s competences and agility further enhance Elisa’s customer-orientation. In addition, the deal will significantly strengthen our market position,’ says Veli-Matti Mattila, CEO and President of Elisa Corporation.

Elisa Corp.

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