The Company's holding of 7,050,000 shares comprises approximately 3.96 per cent. of the fully diluted share capital of Robert Fleming. Accordingly, the Offer values the Company's interest in Robert Fleming at approximately £193 million (US$304 million).
The total consideration available under the Offer will be satisfied to the extent of £2,573 million (US$4,040 million) in cash and to the extent of the balance of US$3,622 million in new shares in Chase. The number of new Chase shares to be issued as consideration for the Offer will be determined by reference to the average of the closing prices of a Chase share on the New York Stock Exchange on the 20 consecutive full trading days immediately preceding the fifth business day prior to the Offer being declared wholly unconditional. However, the total number of new Chase shares which will be issued as consideration under the Offer will not exceed 43,743,961 or be less than 35,790,514.
Assuming a total fully diluted share capital of Robert Fleming of 177,851,962 shares and based on a closing mid-market price of a Chase share on the New York Stock Exchange of US$88.125 on 10th April 2000, the Company would receive approximately £102 million (US$160 million) in cash and 1,629,220 Chase shares for the sale of its Robert Fleming shares pursuant to the Offer. There is a mix and match election available under the Offer pursuant to which Robert Fleming shareholders who accept the Offer can elect, subject to availability, to vary the proportions in which they receive Chase shares and cash.
The Company's shareholding in Robert Fleming had a book value as at 31st December 1999 of US$33.8 million. During the year ended 31st December 1999, the Company's shareholding in Robert Fleming contributed US$3.4 million to the Company's net profit.
Under the terms of the Offer, Robert Fleming shareholders will be entitled to retain a second interim dividend in respect of the financial year ended 31st March 2000 of 17.18 pence (26.83 cents) per share to be paid on 31st May 2000. The total amount of the dividend payable to the Company will be £1.2 million (US$1.9 million).
Cash proceeds received under the Offer are expected to be used to repay debt and for suitable investment opportunities. The Company intends for the time being to retain any Chase shares received as consideration under the Offer, but may in due course take advantage of appropriate opportunities to realise all or part of such shares.
The Company's parent, Jardine Matheson Holdings Limited, has also undertaken to sell its entire holding of 23,600,000 Robert Fleming shares to Chase pursuant to the Offer, which comprises approximately 13.27 per cent. of the fully diluted share capital of Robert Fleming. Due to its size, the sale by Jardine Matheson of its Robert Fleming shares is conditional upon the approval of its shareholders. The Company has undertaken to Chase to vote its beneficial shareholding in Jardine Matheson in favour of the resolution to approve such sale.
The Offer is subject to certain regulatory clearances and other conditions. Chase and Flemings anticipate that the transaction will be completed in approximately four months.
Robert Fleming is an international asset management and investment banking group. It operates in over 40 countries, providing a range of investment banking, corporate finance, capital markets and banking services to a client base that includes major companies, governments, institutional investors, central banks and private individuals.
The £:US$ conversion rates in this announcement are based on an exchange rate of £1 = US$1.57.