ASK : Finalisation of the merger of ASK with the Identification and Traceability Division of the Paragon Group: creation of a European leader in identification solutions

The shareholders of ASK (Euronext Paris - FR0011980077 - ASK), a specialist in secure contactless solutions, approved by 100% at its April 27^th General Meeting the strategic merger of ASK with the Identification and Traceability division of the Paragon Group. Under the terms of the merger Paragon Group will contribute to ASK the shares of the companies making up the “Paragon Identification” division (PID), as previously announced on 26^th October 2016.

The combination of the two companies, as now agreed, results in the creation of a leader in the identification and traceability market, with strong industrial capacities in Europe, China and the USA.

The two entities are already well recognised as market leaders in mass transit & access control sectors. The merging of teams of renowned industry experts, with approximately 600 employees worldwide, allows the group to further develop a comprehensive offer, based on all secure exchange technologies, embedded in all types of media including: passports, identity documents, smart tickets & labels, smart cards, smartphones and bank cards.

The new combined group has a turnover of approximately €110 million (on a proforma basis for the twelve months ending 30^th June 2016) with around €80 million in sales in Europe, €20 million in the United States and €10 million in the rest of the world. 

This merger creates new opportunities for the future, with strong ambitions for development, both through organic and acquisitive growth, in new geographic areas and market sectors.

The company intends to change its name to Paragon ID. This new identity will be proposed to the vote during next General Assembly

An investor meeting (SFAF), presenting the new combined group structure and its ambitions, will be held on Tuesday, May 16^th 2017.

Reminder of the main details of the merger

An information document (Document E), describing the terms and conditions of the contribution, has been registered with the French financial market authority (Autorité des Marchés Financiers - AMF) under reference number E.17-010 on the 30^th March 2017. The document is available for inspection on ASK's website. Additionally, the takeover exemption approval was obtained from the AMF on the 29^th March 2017.

Under the proposed transaction, the Paragon Group will deliver all the PID companies shares; in return ASK will deliver the following:

• 45,706,119 new ordinary shares of ASK;


• 10,000,000 bonds convertible into ordinary shares of ASK with a nominal value of € 1 each, therefore an obligation issue of €10m;


• 10,000,000 non-convertible bonds of the Company with a nominal value of € 1 each, therefore an obligation issue of €10m;


• Cash payement of € 106.4.

As part of this transaction, the valuation of the ASK shares delivered to Paragon Group Ltd. has been fixed at 1.92672 € per share. This will result in the Paragon Group holding 77.5% of the shares of ASK, on a fully diluted basis. The table below details the shareholding structure (non-diluted basis) of ASK the day after completion of this operation:

 
Shares
% Shares
Voting rights
% Voting rights


Grenadier Holdings (Paragon Group Ltd.)
45,706,119
78.42%
45,706,119
75.01%


LBO France Gestion
2,323,950
3.99%
3,735,061
6.13%


Equimax Investissements
1,157,420
1.99%
2,170,495
3.56%


Bluesky Capital
149,309
0.26%
277,142
0.45%


Philippe Geyres
30,000
0.05%
60,000
0.10%


Employees
440
-
880
-


Other registered shareholders
68,996
0.12%
136,669
0.22%


Floating
8,845 590
15.18%
8,845,590
14.52%


Total
58,281,824
100.00%
60,931,956
100.00%

Evolution of governance

The General Meeting on April 27^th approved the nomination of Lis Astall as independent administrator. The Board of Directors of ASK held a Board Meeting 28^th April 2017 and noted the following agreed changes to the composition of the Board.

Resignation: Philippe Geyres, Bluesky Capital, represented by Michel Desbard and Equimax Investments Ltd., represented by Terrence Annamunthodo.

Appointments: John Rogers and Dominique Durant des Aulnois.

The Board of Directors of ASK is now composed of the following 4 members:

• John Rogers, Chairman of the Board of Directors;


• Lis Astall, independent administrator;


• LBO France Gestion, represented by Valery Huot, administrator;


• Dominique Durant des Aulnois, administrator.

Noting that the transaction was now completed, the Board requested the CEO to initiate the full merger of operations and to prepare, as soon as possible, an integration plan to include organisational, commercial, industrial and communication requirements.

Agenda

Event
Date


Investor meeting (SFAF)
May 16, 2017

Source: Actusnews