Tender Offer to Purchase Securities
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Tender Offer to Purchase Securities Of Millennium Steel Public Company Limited by Tender Offerors TATA STEEL LIMITED NatSteel Asia Pte Ltd Tender Offer Preparer and Tender Offer Agent Phatra Securities Public Company Limited TABLE OF CONTENTS Part 1 Significant Elements of the Tender Offer 1 Part 2 Details of the Offerors 4 1. Details of the Offerors 4 2. Details of the Financial Advisor 7 3. Details of Other Advisor 7 4. Relationship between Offerors, and the Company, Major Shareholders or Directors of the Company 7 5. Other Relevant Information for The Securities Holders’ Decision Making 9 Part 3 Details of the Company 11 1. Company Profile 11 2. Business Plan after the Business Takeover 13 Part 4 Additional Details of the Tender Offer 14 1. Tender Offer Acceptance Procedure 14 2. Procedure Purchase 15 3. Settlement and Payment Procedures 15 4. Rights of Securities Holders Who Have Expressed Their Intention to Tender their Securities 16 5. Conditions for Revocation of the Intention to Tender Shares 16 6. Determination of the Offer Price 17 Part 5 Certification of Information 18 Form 247-4 TO: All Shareholders of Millennium Steel Public Company Limited We, TATA STEEL LIMITED (“TATA STEEL”) and NatSteel Asia Pte Ltd (“NSA”) together as the “Offerors”, hereby offer to purchase all ordinary shares of Millennium Steel Public Company Limited (“MS” or the “Company”) in accordance with the terms and conditions set out below (the “Offer”) Part 1 Significant Elements of the Tender Offer 1. Date of submission of the tender offer February 24, 2006 2. Name of the Offerors TATA STEEL LIMITED and NatSteel Asia Pte Ltd, a wholly-owned subsidiary of TATA STEEL LIMITED (TATA STEEL holds 100% of total paid up capital in NSA. Moreover, TATA STEEL and NSA are the same persons under section 246 and 247 of Securities and Exchange Commission (“SEC”) in this tender offer) 3. Name of the Financial Advisor for the tender offer Phatra Securities Public Company Limited 4. Objectives of the tender offer 4.1 The Offerors foresee the potential growth of Thailand’s steel industry. Thus, the Offerors are interested in investing in the steel business through shares acquisition of MS. From the investment in MS, the Offerors would like to be part of the management. Therefore, the Offerors intend to make a voluntary tender offer for all shares of the Company. 4.2 To fulfill conditional binding offer that TATA STEEL proposed to the Company on December 15, 2005. On February 21, 2006, Board of directors of MS acknowledged that all conditions in the binding offer had been fulfilled. The conditions are as follows: 4.2.1 The shareholders of the Company have adopted a valid and legally binding resolution to issue and offer 2,104,543,058 new chares of the Company (24.99% of the paid up capital inclusive of this new shares) to TATA STEEL on a private placement basis at a price of Baht 1.15 per share. 4.2.2 The financial creditors of the Company shall have provided a waiver or consent to the transactions as contemplated herein. 4.2.3 The articles of association of the Company and its three subsidiaries; Siam Iron and Steel (2001) company limited, Siam Construction and Steel company limited and N.T.S. Steel Group public company limited, shall have been amended and registered with the ministry of commerce to remove any foreign shareholding restriction. 4.2.4 The exemption and/or privileges granted by the BOI to the Company and the relevant group member shall have been confirmed by the BOI such that the exemption and/or privileges granted to the Company and the relevant group member shall continue and shall not be affected by the consummation of the transactions. 4.2.5 The execution of the certain agreements between the Company and/or the group member and the Company’s major shareholders such that upon the completion of the tender offer to be carried out by Offerors, the Company and group member can continue their business and operations as currently conducted. 4.2.6 Cementhai Holding Company (“CHC”) has sent out the disclosure letter to release information of the Company that is acceptable by TATA STEEL. 4.3 To comply with the regulatory conditions set forth in the Notification of the SEC No.GorJor 53/2545 on the Rules, Condition, and Procedures for Acquisition of Securities for Business Takeover, dated 18 November 2002. 4.4 Upon closing of tender offer period, the Offerors have no intention to delist shares of the Company from the Stock Exchange of Thailand (SET) within the next 12 months except in the case that the Company does not meet the requirement of the SET and SET requires the Company to delist or Board of directors of MS approve on delisting MS’s shares from SET. 1 Form 247-4 5. Type and class of the securities offered to purchase 5.1 5,664,056,515 common shares representing 100.0 percent of total common share and 89.7 percent of total voting rights of the Company. 5.2 652,941,275 common shares, which result from the conversion of preferred shares, representing 100.0 percent of total preferred share and 10.3 percent of total voting rights of the Company. Note: Conversion of preferred shares to common shares must only be done via MS. The conversion process takes approximately 10 working days. Thus, the last day to submit conversion form and supporting documents to MS is on March 17, 2006. This tender offer does not include • MS-Warrant 1 (MS-W1) which has an exercise price of 2.10 Baht and conversion ratio of 1 unit of MS-W1 for 1 common share (1:1). As of December 31, 2005, the units outstanding of MS-W1 are 1,083,275,200 units. • MS-Warrant 2 (MS-W2) which has an exercise price of 6.114 Baht and conversion ratio of 1 unit of MS-W2 for 1 common share (1:1). As of December 31, 2005, the units outstanding of MS-W2 are 1,520,763,525 units. 6. Offer Price The tender offer price is Baht 1.15 (One Baht and fifteen Satang) per share. Shareholders accepting this Offer (a “Seller” or “Offeree”) will incur a commission of 0.25 percent of the offer price plus 7 percent of Value Added Tax (VAT) on such commission to the Tender Offer Agent. Thus, the net proceed to Offerees is Baht 1.14692375 (One Baht and one four six nine two three seven five Satang) per share. Such offer price is: ( × ) the final offer which will not be changed (subject to the conditions specified in section 8 below) ( _ ) not the final offer and the Offerors may change the offer price Under the Revenue Code, unless exempted by an applicable tax treaty, capital gains realized by non-resident corporate holders from the sale of shares will be subject to a 15% withholding tax in Thailand. Withholding tax is calculated on the capital gains (the difference between the tender offer price and the cost basis). The Offeree must declare the cost basis to the Tender Offer Agent by completing a Confirmation of Securities Cost Form attached in Appendix 10. If the Offeree fails to declare the cost basis and to submit proper evidence of the cost basis, the Tender Offer Agent will determine the withholding tax based on the entire proceeds of the sale of the shares and deduct taxes accordingly. Note: Thai Juristic Person is responsible for withholding 3% withholding tax on the commission fee and must issue Withholding Tax Certificate to the Tender Offer Agent, which is Phatra Securities Public Company Limited. 7. Offer Period The tender offer period will be a total of 25 (twenty-five) business days from February 27, 2006 to March 31, 2006, both days inclusive during the hours of 8.30 a.m. to 4.30 p.m. Such tender offer period is: ( × ) the final period which will not be extended (subject to the conditions specified in section 8 below) ( _ ) not the final period and the Offerors may extend the period 8. Conditions for changes in the tender offer ( _ ) no condition ( × ) conditions of change in the tender offer are as follows: ( × ) the Offerors may reduce the offer price and/or extend the tender offer period if any event or action having a material adverse effect on the Company’s status or assets occurs during the tender offer period. ( × ) the Offerors may change the offer and/or extend the tender offer period to compete with another person if that person has submitted a tender offer for securities of the Company during the tender offer period. 9. Conditions for cancellation of the tender offer The Offerors may cancel the tender offer of the Company upon the occurrence of one or more of the following events: 9.1 At the end of the tender offer period, if the Offerors cannot acquire upto 51.0% of the total shares of the Company after the capital increased amount of 2,104,543,058 shares which was a resolution from the Extraordinary General Meeting on February 16, 2006. The capital increase process is expected to finish by March 28, 2006, which is 3 days prior to the completion of the tender offer period, or 2 Form 247-4 9.2 any event or action occurring after the submission of the tender offer to the SEC but before the end of the tender offer period, which has or may have a material adverse effect on the Company’s status, assets or business, where such events or actions do not result from acts of the Offerors or any act for which the Offerors are responsible, or 9.3 the Company takes any action after the submission of the tender offer to the SEC but before the end of the tender offer period, which results in a significant decrease in the value of the Company’s shares.