@Schneider does @Invensys #pauto #mergers #economy #automation

Early this morning, it was announced that Schneider Electric's offer of 3.4 billion Euros for Invensys Plc was accepted and recommended by Invensys' board of directors.

The following is the text of the official announcement:

 THIS ANNOUNCEMENT IS AN ADVERTISEMENT AND NOT A PROSPECTUS OR 

PROSPECTUS EQUIVALENT DOCUMENT AND INVESTORS SHOULD NOT SUBSCRIBE FOR 

ANY SCHNEIDER ELECTRIC SHARES IN CONNECTION WITH THE OFFER EXCEPT ON THE 

BASIS OF INFORMATION IN THE PROSPECTUS WHICH IS PROPOSED TO BE PUBLISHED 

BY SCHNEIDER ELECTRIC IN DUE COURSE 

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 SUCH JURISDICTION 

31 July 2013 

RECOMMENDED OFFER 

for 

Invensys plc (“Invensys”) 

by 

Schneider Electric S.A. (“Schneider Electric”) 

Summary 

• The boards of Schneider Electric and Invensys are pleased to announce that they have 

reached agreement on the terms of a recommended offer pursuant to which Schneider 

Electric and/or a wholly-owned subsidiary of Schneider Electric will acquire the entire issued 

and to be issued ordinary share capital of Invensys. The Offer is to be effected by means of 

a scheme of arrangement of Invensys under Part 26 of the Companies Act. 

• Under the terms of the Offer, Invensys Shareholders will be entitled to receive: 

For each Invensys Share: 0.025955 New Schneider Electric Shares; and 

 372 pence in cash. 

The Offer represents a value of: 

• 502 pence per Invensys Share, or £3.4 billion for the entire issued and to be issued 

ordinary share capital of Invensys, based on the closing price per Schneider Electric 

Share on 11 July 2013 (being the commencement of the Offer Period) of €58.06 and 

an exchange rate on 11 July 2013 of £/€ 1.1592. 

Based on the offer value of 502 pence per Invensys Share, the Offer represents a premium 

of approximately: 

• 14 per cent. to the closing price per Invensys Share of 440 pence on 11 July 2013 

(being the commencement of the Offer Period); and 

• 27 per cent. to the volume weighted average closing price per Invensys Share of 

396 pence in the three months to 11 July 2013 (being the commencement of the 

Offer Period). 

• The Schneider Electric Board believes that the transaction will generate significant revenue 

synergies of approximately €400 million per annum by 2018 as a result of enlarged 

offerings, complementary customer bases and additional scale from the integration of 

Invensys with Schneider Electric. The estimated impact on EBITA is approximately €65 

million per annum by 2018. In addition, the Schneider Electric Board believes that Schneider

Electric will be able to achieve cost savings of approximately €140 million1

 per annum by 

2016 derived from structural and administrative cost savings, efficiency gains at country and 

regional levels and synergies on procurement and production costs. The Schneider Electric 

Board expects the transaction to generate tax savings valued at approximately £400 million 

(approximately €0.5 billion including approximately €80 million per annum over the first five 

years) consisting mainly of utilising tax credits at Invensys. Integration costs relating to the 

transaction are estimated at approximately €150 million2

 over 2014 and 2015.3

• The Offer will include a Mix and Match Facility, so that Invensys Shareholders will be able to 

elect to vary the proportions of cash and New Schneider Electric Shares they receive, 

subject to the elections made by other Invensys Shareholders. The Mix and Match Facility 

will not change the total number of New Schneider Electric Shares to be issued by 

Schneider Electric or the total cash consideration to be paid pursuant to the Offer. 

• Following completion of the Offer, Invensys Shareholders will own approximately 3 per cent. 

of the Enlarged Group and will be able to participate in the future growth prospects of the 

Enlarged Group. 

• The Invensys Directors, who have been so advised by Barclays and J.P. Morgan Cazenove, 

consider the terms of the Offer to be fair and reasonable. In providing advice to the Invensys 

Directors, Barclays and J.P. Morgan Cazenove have taken into account the commercial 

assessments of the Invensys Directors. Barclays is providing independent financial advice 

to the Invensys Directors for the purposes of Rule 3 of the Code. 

• Accordingly, the Invensys Directors intend unanimously to recommend Invensys 

Shareholders to vote in favour of the Scheme at the Court Meeting and the resolution(s) to 

be proposed at the General Meeting as the Invensys Directors have irrevocably undertaken 

to do in respect of their own beneficial holdings of 761,370 Invensys Shares representing, in 

aggregate, approximately 0.11619 per cent. of the ordinary share capital of Invensys in 

issue on 30 July 2013 (being the latest practicable date prior to this announcement). 

• The Offer will be put to Invensys Shareholders at the Court Meeting and at the General 

Meeting. In order to become effective, the Scheme must be approvved by a majority in 

number of the Invensys Shareholders voting at the Court Meeting, either in person or by 

proxy, representing at least three-quarters in value of the Invensys Shares voted at the 

Court Meeting. In addition, special resolutions implementing the Scheme and approving the 

related Capital Reduction must be passed by Invensys Shareholders representing at least 

three-quarters of votes cast at the General Meeting. 

• The Offer is also subject to the Conditions and further terms set out in Appendix I to this 

announcement including the sanction of the Scheme by the Court, the satisfaction of certain 

regulatory conditions (including anti-trust clearances in the EU, the US, Brazil, Canada and 

China and CFIUS clearance in the US), the Pensions Condition and admission to trading of 

the New Schneider Electric Shares on Euronext Paris (Compartiment A).

The Scheme Document, containing further information about the Offer and notices 

convening the Court Meeting and the General Meeting, will be published as soon as 

practicable and will be made available by Schneider Electric on its website at 

www.schneider-electric.com and by Invensys on its website at www.invensys.com. 

• It is expected that the Scheme will become effective by 31 December 2013, subject to the 

satisfaction or waiver of the Conditions and certain further terms set out in Appendix I to this 

announcement. 

Commenting on the Offer, Sir Nigel Rudd, Chairman of Invensys, said: 

“Following the recent disposal of Invensys Rail, the agreement with the Pension Trustees 

and the re-organisation of the Group, the Invensys Directors believe that Invensys is 

strongly positioned to execute on its growth strategy going forward. 

However, the Invensys Directors believe that the offer from Schneider Electric represents an 

attractive value for Invensys Shareholders and reflects the future growth prospects of the 

business and a significant proportion of the benefits which are expected to accrue from the 

strong strategic fit between Invensys and Schneider Electric. 

Combined with the disposal of Invensys Rail and return of £625 million to shareholders, this 

represents a very attractive outcome for Invensys Shareholders. Furthermore, the members 

of the Invensys Pension Scheme will benefit from the ongoing support of a significantly 

larger, leading, global automation business.” 

Commenting on the Offer, Mr Jean-Pascal Tricoire, Chairman of the Board and CEO of Schneider 

Electric, said: 

“We are delighted to announce the combination of Invensys and Schneider Electric in what 

is an exciting day for the stakeholders of both companies. The addition of Invensys' 

businesses will considerably strengthen Schneider Electric's overall offering to its industrial 

and infrastructure customer base, reinforcing us as a global leader in energy management 

solutions integrating power and automation, as well as leading software for customer 

efficiency. The transaction will allow Schneider Electric to benefit from increased scale and 

realise substantial synergy benefits from the combination. We believe our offer is compelling 

to Invensys Shareholders who will realise significant value for their holdings while having the 

opportunity to participate in the future strengths of the combined business. 

We warmly welcome Invensys' team and believe that the combined business will provide 

new and larger growth opportunities for employees and customers as well as offering 

Schneider Electric's shareholders significant future value creation.” 

This summary should be read in conjunction with, and is subject to, the full text of this 

announcement (including its Appendices). The Offer will be subject to the CondThis summary should be read in conjunction with, and is subject to, the full text of this 

announcement (including its Appendices). The Offer will be subject to the Conditions and 

further terms set out in Appendix I to this announcement and to the full terms and 

conditions to be set out in the Scheme Document and the Forms of Proxy. 

Appendix II to this announcement contains further details of the sources of information and bases 

of calculations set out in this announcement. Appendix III contains a summary of the irrevocable 

undertakings received in relation to the Offer. Appendix IV contains details of the arrangements 

proposed to be implemented in relation to Invensys Share Schemes together with certain other 

matters relating to the retention and incentivisation of key management and employees and 

Appendix V contains definitions of certain expressions used in this summary and in this 

announcement. 

Go here for the entire document in all its legal glory: http://www.invensys.com/isys/docs/offer/Recommended_offer_for_Invensys_plc_by_Schneider_Electric_S.A.pdf