Premier Investments Limited · ASX:PMV
Premier Investments — Merger or Acquisition (July 2008)
22 slides from Premier Investments's merger presentation, Jul 23, 2008
Slide 1: Investor presentation—Enhanced Offer to acquire Just Group Limited
For personal use only Investor presentation— Enhanced Offer to acquire Just Group Limited 23 July 2008
Slide 2: Important notice and disclaimer
Important notice and disclaimer For personal use only This presentation has been prepared by Premier Investments Limited (“Premier”) for general information purposes only, without taking into account any investor's objectives, financial position or needs. This presentation is based on information co
Slide 3: Agenda
Agenda For personal use only A What Just Shareholders will receive under Premier’s Enhanced Offer B Why Just Shareholders should accept the Offer C Why Just Shareholders should accept before 7pm AEST on 6 August 2008 D Other important considerations for Just Shareholders E Conclusions 2
Slide 4: What shareholders will receive if they accept
A What shareholders will receive if they accept Premier’s Enhanced Offer For personal use only ♦ $2.095 cash Base Offer ♦ 0.25 Premier shares ♦ $0.15 cash if Premier’s relevant interest ≥90% of Just shares Enhanced Offer ♦ Participate in Premier’s fully franked final dividend of $0.18 per Premier sh
Slide 5: Implied value of what Just Shareholders will receive
A Implied value of what Just Shareholders will receive Implied value received by Just Shareholders under Premier’s Enhanced Offer For personal use only per Just Share2 Value based on Premier’s Value based on Premier’s Value based on one month pre Offer VWAP post Just’s Premier’s NTA 3 Announcement V
Slide 6: Ten reasons why shareholders should accept Premier's Offer
B Ten reasons why shareholders should accept Premier’s Offer 1 Just’s earnings outlook for FY2008 to FY2010 has substantially deteriorated For personal use only 2 Just’s share price has fallen significantly—may fall further if Premier’s Offer does not succeed 3 Premier’s Enhanced Offer is the only o
Slide 7: Just's earnings outlook for FY2008 to FY2010 has substantially deteriorated
1 Just’s earnings outlook for FY2008 to FY2010 has substantially deteriorated Just recently further downgraded its FY2008 earnings by 10-15% For personal use only downgraded 10-14% 102.8 88.5-92.7 downgraded 11-15% 32.2 27.3-28.7 Target's Statement Updated Forecast Target's Statement Updated Forecas
Slide 8: Just's earnings outlook deteriorated (continued): challenging environment
1 Just’s earnings outlook for FY2008 to FY2010 has substantially deteriorated (continued) Just is continuing to face a challenging environment post FY2008 For personal use only Consumer confidence levels in Australia and New Zealand 110 ♦ Premier stands by comments made on its Offer Announcement Dat
Slide 9: Brokers have further downgraded their earnings forecasts for Just
1 Just’s earnings outlook for FY2008 to FY2010 has substantially deteriorated (continued) Brokers have recently further downgraded their earnings forecasts for Just For personal use only Pre Offer Pre Target Post Target Post Earnings Announcement Statement Statement Downgrade (cents per Share) (31 M
Slide 10: Just's FY2010 strategic goal inconsistent with broker consensus
1 Just’s earnings outlook for FY2008 to FY2010 has substantially deteriorated (continued) Just’s FY2010 strategic goal of at least 40 cents EPS is inconsistent with broker For personal use only consensus estimates and appears highly unrealistic 45 +33% 40.0 40 +5%-10% 35 30.2 27.3-28.7 30 EPS (cps)
Slide 11: Just's share price has fallen significantly
2 Just’s share price has fallen significantly—may fall further if Premier’s Offer does not succeed Just’s share price has reacted adversely to Just’s two recent announcements on For personal use only earnings outlook 4.60 $4.49 $4.34 4.10 $4.06 $3.91 2-Jul-08 3.60 Just releases Earnings Downgrade an
Slide 12: Premier's Offer is the only offer available
3 Premier’s Enhanced Offer is the only offer available For personal use only ♦ Despite the substantial fall in Just’s share price and earnings outlook Premier has enhanced its offer terms by: – adding $0.15 cash if Premier’s relevant interest in Just Shares is 90% or more; PLUS – making the size and
Slide 13: 43% to 58% implied takeover premium
4 Premier’s Enhanced Offer represents a 43% to 58% implied takeover premium ♦ The high premium range offered of 43% to 58% above Just’s trading price since its For personal use only Earnings Downgrade applies if Premier achieves a relevant interest in > 90% of Just Shares 57.8% 52.5% 42.6% 37.4% 14
Slide 14: 14.1x to 16.4x implied acquisition FY2008 PE range
5 Premier’s enhanced, final offer price represents a 14.1x to 16.4x implied acquisition FY2008 PE range For personal use only Implied FY2008 PE multiple of Premier Offer 15.6-16.4 15.1-15.9 12.8-13.9 14.1-14.9 13.6-14.3 11.8-12.9 Based on Premier's Based on Premier's 1- Based on Premier's Based on P
Slide 15: Cash components represent up to 81% of Just's recent average share price
6 The cash components of Premier’s Enhanced Offer represent up to 81% of Just’s recent average share price For personal use only ♦ Premier’s Offer allows Just shareholders to de-risk their investment through a substantial cash component 5.00 4.00 75-81% cash 1.77 – 2.20 1.77 – 2.20 components 3.00 (
Slide 16: Just needs Premier
7 Just needs Premier For personal use only ♦ The Earnings Downgrade demonstrates the Special Committee’s lack of retail experience ♦ Current Just management team needs mentoring and guidance from a Board with deep experience across the retail spectrum—including through significant downturns ♦ Just h
Slide 17: Premier shares are an attractive investment opportunity
8 Premier shares are an attractive investment opportunity For personal use only ♦ Premier has a history of creating shareholder value (more than double Just since Just’s listing): Premier TSR vs Just TSR since listing of Just (to 22 July 2008) 350 300 250 133% 200 150 65% 100 50 0 May-04 Oct-04 Mar-
Slide 18: Potential CGT rollover relief on the share component
9 Potential CGT rollover relief on the share component of the consideration For personal use only ♦ Premier has enhanced its Offer and declared the enhanced Offer price final ♦ If Premier succeeds in acquiring 80% or more of Just shares, CGT rollover relief will be available for the Premier scrip co
Slide 19: Potential acceleration of payment of base offer cash and waiver of conditions
10 Potential acceleration of payment of base offer cash and waiver of remaining Offer conditions For personal use only ♦ Premier’s Offer is subject to a number of conditions, including: – a material adverse change condition – a condition that the S&P/ASX200 will not close below 4600 on any trading d
Slide 20: Why Just Shareholders should accept by 7pm on 6 August
C Why Just Shareholders should accept by 7pm on 6 August 2008 For personal use only Accepting by 6 August 2008 represents Just Shareholders’ best and most certain chance of Premier’s Offer proceeding ♦ Some Shareholders may only be prepared to accept Premier’s offer if they are certain it will proce
Slide 21: Other important considerations: Acceptance Facility
D Other important considerations for Just shareholders For personal use only Acceptance Facility ♦ Some shareholders may not be able to accept Premier’s offer at this time (e.g. because it remains conditional) ♦ UBS Investment Bank has established an Acceptance Facility to hold acceptance instructio
Slide 22: Conclusions
E Conclusions For personal use only ♦ Premier has enhanced its Offer despite Just’s Earnings Downgrade and declared its enhanced Offer price final ♦ Premier’s Enhanced Offer represents a highly attractive premium range of 43% to 58% to Just’s post Earnings Downgrade VWAP29 ♦ Premier needs to achieve
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