Revolution dismisses third merger offer by Deltic

Claire Dodd

Claire Dodd

10 October 2017

The bidding war for Revolution shows no sign of slowing down as the bar group rejected a second
offer from Deltic Group yesterday, only for Deltic to issue a revised offer, which has again been
turned down by Revolution.

The ruckus is focused on the fact that Revolution is seeking a cash offer for the business; something
already put forward by pub operator Stonegate.

However, nightclub operator Deltic’s merger offer centres on a model where Revolution
shareholders would own 65% and Ranimul shareholders 35% of the ‘Enlarged Group’. In its revised
offer yesterday, it proposed at a £22.3m loan from Ranimul, would be refinanced alongside other
facilities with third party debt, in order to 'replace high coupon debt with third party debt at
commercial rates and not to extract cash'.

'The Ranimul Loan holders would, as an alternative to the original merger proposal,
be prepared to convert all or part of the value of the Ranimul Loan into additional shares in
Revolution at a conversion price of not less than 203 pence per share subject to a special dividend or
equivalent mechanism for a return of capital of not less than 20 pence per share being paid to all
shareholders in the Enlarged Group on the merger becoming effective,' it added.

Deltic said it had 'positive feedback from a significant number of Revolution shareholders' it had
met with in respect of the merger proposal.

However, Revolution this morning issued a statement dismissing the offer saying the revised merger
proposal is the same as the original merger proposal set out by Deltic.

'The board maintains and reiterates that it does not believe that the revised merger
proposal would create shareholder value for Revolution's existing shareholders in excess of the
certain and immediate value represented by the recommended 203p cash offer from Stonegate Pub
Group Limited,' the statement said.

'The Board reiterates that it encourages Deltic to make a cash offer for Revolution rather than
continuing to focus on its merger proposal.'

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