Darius Capital Limited - s. 104(2)(c)

Order

Headnote

Take-over bid made in Ontario -- bid made in accordance with the laws of the United Kingdom and The City Code on Takeovers and Mergers -- de minimis exemption unavailable as there is one Ontario resident holds approximately 4.7% of the target shares, which exceeds the 2% threshold in section 93(1)(e) of the Securities Act (Ontario) - bid exempted from the requirements of sections 95 through 100, subject to certain conditions.

Statutes Cited

Securities Act, R.S.O. 1990, c. S.5, as am., ss. 93(1)(e), 95-100, 104(2)(c).

Recognition Orders Cited

In the Matter of the Recognition of Certain Jurisdictions Recognition Order (Clauses 93(1)(e) and 93(3((h) of Act) (1997), 20 OSCB 1035.

November 10, 2006

IN THE MATTER OF

THE SECURITIES ACT,

R.S.O.1990, CHAPTER S.5, AS AMENDED (the "Act")

AND

IN THE MATTER OF

DARIUS CAPITAL LIMITED

("Darius Capital")

 

ORDER

(Clause 104(2)(c))

UPON the application (the "Application") of Darius Capital to the Ontario Securities Commission (the "Commission") for an order pursuant to clause 104(2)(c) of the Act that Darius Capital be exempt from the requirements of sections 95 to 100 of the Act in connection with the proposed offer (the "Offer") by Darius Capital to acquire all of the outstanding ordinary shares of Austin Reed Group PLC ("Austin Reed") in exchange for cash consideration equal to 144 pence per Austin Reed Share;

AND UPON considering the Application and the recommendation of the staff of the Commission;

AND UPON Darius Capital having represented to the Commission as follows:

1. Darius Capital is a corporation incorporated under the laws of England and Wales;

2. Darius Capital is not a reporting issuer under the Act or the securities legislation of any other province or territory of Canada;

3. Austin Reed is a company incorporated under the laws of England and Wales. Its issued share capital as of October 12, 2006 consisted of 31,995,598 ordinary shares of 25p each (the "Austin Reed Shares"). The Austin Reed Shares are listed for trading on the London Stock Exchange;

4. Austin Reed is not a reporting issuer under the Act or the securities legislation of any other province or territory of Canada;

5. Pursuant to the Offer, each holder of Austin Reed Shares (a "Shareholder") who accepts the Offer will receive 144 pence in cash for each Austin Reed Share tendered to the Offer;

6. The directors of Austin Reed consider that the Offer's terms are fair and reasonable and accordingly, have recommended unanimously that shareholders accept the Offer;

7. The Offer is being made in compliance with the laws of the United Kingdom, the rules and regulations of the London Stock Exchange, and the City Code on Takeovers and Mergers;

8. As at October 12, 2006, there was one Shareholder whose last address as shown on the register of shareholders of Austin Reed is in Ontario (the "Ontario Shareholder"), holding, in aggregate, approximately 1,409,200 Austin Reed Shares or 4.4% of the total number of the outstanding Austin Reed Shares;

9. The Offer is being made on the same terms and conditions to the Ontario Shareholder as it is being made to Shareholders resident in the United Kingdom and other jurisdictions (other than certain jurisdictions where the Offer is not permitted);

10. Although the Commission has recognized the laws of the United Kingdom for the purposes of clause 93(1)(e) of the Act, Darius Capital cannot rely upon the exemption in clause 93(1)(e) from the requirements in sections 95 to 100 of the Act because the Austin Reed Shares held by the Ontario Shareholder constitute, in the aggregate, greater than 2 percent of the total issued and outstanding shares of Austin Reed;

11. All material relating to the Offer that has been or will be sent by Darius Capital to Shareholders residing in the United Kingdom and other jurisdictions (other than certain jurisdictions where the Offer is not permitted) concurrently: (i) has been sent or will be sent to the Ontario Shareholder; and (ii) has been filed or will be filed with the Commission.

AND UPON the Commission being satisfied that to do so would not be prejudicial to the public Interest

IT IS ORDERED pursuant to clause 104(2)(c) of the Act that, in connection with the Offer, Darius Capital is exempt from the requirements of sections 95 to 100 of the Act, provided that:

(a) the Offer and all amendments thereto are made in compliance with the City Code on Takeovers and Mergers; and

(b) all materials relating to the Offer and any amendments thereto that are sent by or on behalf of Darius Capital to Shareholders residing in the United Kingdom and other jurisdictions (other than certain jurisdictions where the Offer is not permitted) are concurrently sent to the Ontario Shareholder and copies of such materials are filed concurrently with the Commission.

"Harold P. Hands"
Ontario Securities Commission
 
"Wendell S. Wigle"
Ontario Securities Commission