Securities Law & Instruments

Headnote

Securities exchange take-over bid made in Ontario - Bid made in accordance with the laws of the United Kingdom and The City Code on Take-overs and Mergers - De minimis exemption unavailable because there is one Ontario holder of offeree's shares holding approximately 4.7% of the class, which exceeds the 2% threshold in section 93(1)(e) of the Securities Act (Ontario) - Bid exempted from the requirements of Part XX, subject to certain conditions.

Statutes Cited

Securities Act, R.S.O. 1990, c. S.5, as amended, ss. 93(1)(e), 95-100 and 104(2)(c).

Recognition Orders Cited

In the Matter of the Recognition of Certain Jurisdictions Recognition Order (Clauses 93(1)(e) and 93(3((h) of Act) (1997), 20 OSCB 1035.

IN THE MATTER OF

THE SECURITIES ACT,

R.S.O. 1990, CHAPTER S.5, AS AMENDED (THE "ACT")

AND

IN THE MATTER OF

FUTURE PLC

 

ORDER

(Section 104(2)(c))

UPON the application (the "Application") of Future plc ("Future" or the "Applicant") to the Ontario Securities Commission (the "Commission") for an order pursuant to section 104(2)(c) of the Act exempting Future and its financial advisor, Morgan Stanley & Co. Limited ("Morgan Stanley" and, together with Future, the "Offering Parties"), from the requirements of sections 95 through 100 of the Act in connection with the offer (the "Offer") by Future to acquire all of the issued and to be issued ordinary shares (the "Highbury Shares") of Highbury House Communications plc ("Highbury") to be made to the shareholders of Highbury (the "Highbury Shareholders") resident in Ontario;

AND UPON considering the Application and the recommendation of the staff of the Commission;

AND UPON the Applicant having represented to the Commission as follows:

1. Future is incorporated under the laws of England and Wales. Future's shares are listed on the Official List of the UK Listing Authority and admitted to trading on the London Stock Exchange (the "LSE"). Future is not a reporting issuer in Ontario, nor is it a reporting issuer or the equivalent in any other province or territory of Canada.

2. Morgan Stanley, which is regulated in the United Kingdom by the Financial Services Authority, is acting as financial adviser to Future.

3. Highbury is incorporated under the laws of England and Wales. The Highbury Shares are listed on the Official List of the UK Listing Authority and admitted to trading on the LSE. Highbury is not a reporting issuer in Ontario, nor is it a reporting issuer or the equivalent in any other province or territory of Canada.

4. The Offer is to acquire all of the Highbury Shares on the basis of 10 newly issued ordinary shares of Future ("Future Shares") for every 83.25 Highbury Shares and so on in proportion for any number of Highbury Shares held. Each Highbury Shareholder may elect to receive 10.0 pence in cash for each Highbury Share, instead of some or all of the Future Shares to which it would otherwise be entitled under the Offer. The aggregate amount of cash payable under the Offer is limited to 10 million pounds sterling and, to the extent to which elections for the partial cash alternative exceed in aggregate this amount, they will be reduced on a pro rata basis.

5. The Offer is being made by Morgan Stanley on behalf of the Offeror (other than in the United States where the Offer is being made directly by Future), and will comply with, and not be exempt from, the requirements of the rules of The City Code on Takeovers and Mergers. The Offer will also comply with the applicable requirements of the Panel on Takeovers and Mergers, the LSE and the UK Listing Authority.

6. The Offer will be subject to the conditions and terms set out in the Offer document. Due to its size, the Offer will be conditional, inter alia, on the approval of Future shareholders at an extraordinary general meeting which is expected to be held in late March 2005.

7. Based upon information provided to the Offering Parties by Highbury from its share register, as at January 31, 2005, there were no Highbury Shareholders resident in Canada other than one shareholder resident in Ontario (the "Ontario Highbury Shareholder"), holding 14,750,000 Highbury Shares, representing 4.7% of the issued share capital of Highbury.

8. The Offer document is expected to be mailed to Highbury Shareholders (other than shareholders in certain jurisdictions where the Offer is not permitted) in the week commencing February 28, 2005.

9. All of the Highbury Shareholders to whom the Offer is made, including the Ontario Highbury Shareholder, will be treated equally (though Future reserves the right to sell any Future Shares to which an accepting Highbury Shareholder in an overseas jurisdiction would otherwise be entitled under the Offer and to remit the sale proceeds to the Highbury Shareholder, in order not to contravene the laws of that jurisdiction).

10. If Future receives acceptances under the Offer in respect of, and/or otherwise acquires, 90% or more of the Highbury Shares to which the Offer relates and the Offer becomes unconditional in all respects, Future intends to exercise its rights under the UK Companies Act to acquire compulsorily Highbury Shares in respect of which acceptances have not been received.

11. It is intended that, following the Offer becoming or being declared unconditional in all respects and subject to any applicable requirements of the UK Listing Authority, Future will procure that Highbury applies to the UK Listing Authority for the listing of the Highbury Shares on the Official List to be cancelled and to the LSE for the admission to trading of the Highbury Shares to be cancelled. It is expected that such cancellations will take effect no earlier than 20 business days after the Offer becomes or is declared unconditional in all respects. Following the Offer becoming or being declared unconditional in all respects, it is also the intention of Future to propose a resolution to re-register Highbury as a private company.

AND UPON the Commission being satisfied that to do so would not be prejudicial to the public interest.

IT IS ORDERED, pursuant to section 104(2)(c) of the Act that, in connection with the Offer to the Ontario Highbury Shareholder, the Offering Parties be exempt from the requirements of sections 95 through 100 of the Act, provided that all materials relating to the Offer sent by or on behalf of Future to holders of Highbury Shares resident in the United Kingdom are concurrently:

(a) sent to the Ontario Highbury Shareholder; and

(b) filed with the Commission.

February 25, 2005.

"Robert L. Shirriff"
"Suresh Thakrar"