Highlights

Today the boards of Waterman Group plc (“Waterman”) and CTI Engineering Co., Limited (“CTI”) have announced the terms of a recommended cash offer to be made by CTI to acquire the entire issued and to be issued share capital of Waterman not already agreed to be acquired by CTI. The Offer price of 140p per Waterman share represents an 83% premium to the closing mid-market price on 8 May 2017, being the latest dealing day prior to announcement of the Offer. The Offer values the entire issued share capital of Waterman at approximately £43m.

Certain of the Waterman management team, together with two of the Company’s major shareholders; AB Traction and Hargreave Hale, have agreed to sell their respective holdings to CTI at the Offer price, subject only to release of this morning’s announcement. CTI has therefore unconditionally agreed to purchase 8,131,419 Waterman shares, representing 26.44% of the voting share capital of Waterman on 8 May 2017.

Background to the Offer and reasons for the recommendation

CTI is the oldest of Japan’s top three ranked (source: Nikkei Construction) major consulting engineering companies, and has had a full listing on the Tokyo Stock Exchange since 1996. The Acquisition fits with CTI’s strategy to build organically and through acquisitions, and through developing overseas markets to expand its private sector client base. It will provide CTI with a significant presence in the UK, which is one of the world’s leading centres for consulting engineering services.

As noted in its interim results for the six months to 31 December 2016, Waterman continues to deliver consistent performance in more challenging markets. Notwithstanding Waterman’s track record of profitable growth and its optimism for the future, the Waterman directors consider that the Offer provides Waterman shareholders with certainty of value at a level which adequately reflects both the quality of the Waterman business and its position in its selected markets.

Ticker: WTM
Website: www.watermangroup.com