COLT-GROUP-S.A.

Colt Group S.A. (London Stock Exchange: COLT) today announces its proposed acquisition of KVH.

• Attractive transaction which will provide Colt with scale and complementary capability in key Asian cities
• Colt has a city-based expansion strategy, targeting customers operating in information intensive industries. KVH is present in Tokyo, the world’s number one city economy, as well as Singapore, Hong Kong and Seoul; providing a platform in four of Colt’s target cities for expansion
• The Transaction will provide Colt with a platform to enter the APAC ICT services market, which is growing at c.12% per annum
• Colt and KVH operate complementary businesses with similar technology and platforms, business models and product sets. KVH’s business is well known to Colt’s key management, which is expected to assist with implementing Colt’s integration plans
• The Transaction will enhance Colt’s competitive position in serving multi-national customers (“MNCs”), which is expected to provide attractive opportunities for growth
• The Transaction is expected to deliver annual cost and capex synergies of €8.5m by 2017
• Total cash consideration of ¥18.595 billion (€130.3m), for 100% of KVH payable in cash on completion of the Transaction. The Transaction is to be fully funded through existing Colt cash resources and committed bank facilities
• Expected to be earnings and cash flow enhancing in the year ending 2016 and thereafter
• KVH is owned 100% by FMR, FIL and associates of FMR, and FIL. FMR, FIL and certain of their associates are also shareholders of Colt. The Transaction constitutes a related party transaction which is subject to the approval of Independent Shareholders. Accordingly, a General Meeting will be held at 10.00 a.m. (Luxembourg time) on 16 December 2014 at K2 Building, Forte 1, 2a rue Albert Borschette, L-1246, Luxembourg at which the approval of the Company’s shareholders will be sought for the Transaction
• For the purposes of the statement by the Board that the Transaction is fair and reasonable as far as shareholders are concerned, the Fidelity Directors have not taken part in the Board’s consideration of the matter.
• The Board, which has been so advised by Morgan Stanley, acting in its capacity as sponsor, considers that the terms of the Transaction are fair and reasonable as far as the Shareholders are concerned. In giving its advice, Morgan Stanley has taken account of the Board’s commercial assessment of the Transaction
• The Board considers the Transaction to be in the best interests of Shareholders as a whole. Accordingly, the Board recommends that the Independent Shareholders vote in favour of the Related Party Resolution at the Extraordinary General Meeting, as the Independent Directors intend to do in respect of their own beneficial holdings of, in aggregate, 10,000 Ordinary Shares, representing approximately 0.001% of the Ordinary Shares currently in issue.

Rakesh Bhasin, Colt Chief Executive Officer, said:

“I am pleased to announce our plan to acquire KVH. It is a growing business, largely focused on network and data centres in Asia. They have strong capabilities, a significant customer base and great assets, all complementary to our own. This partnership will enable Colt to offer our customers seamless solutions on a global basis and give us a solid platform for growth in Asia.”

Sergio Giacoletto, Senior Independent Director, said

“The Independent Directors of Colt unanimously believe the strategic rationale for a combination of Colt with KVH is compelling. KVH is at an exciting point in its evolution, having recently launched several strategic growth programmes that are expected to deliver sustained revenue growth and profit expansion over the medium term. The Independent Directors believe this Transaction will be financially beneficial to Colt, delivering growth and value creation for all shareholders.”

Ted Higase, KVH Chief Executive Officer, said:

“We are delighted to formally become part of the Colt family. The combination of our two companies will add scale, improve the competitiveness of both KVH and Colt, and be beneficial to all our customers. KVH will provide an established and successful platform – deploying its assets, relationships and people – for growth in Asia as part of a larger Colt organisation. We look forward to being able to leverage Colt’s operating experience, customer relationships, technology platform, and advanced processes, systems and best practices.”

Contact:

Colt Technology Services
Helen Toft
Director, Head of External Communications,
DDI +44 (0)2070392420

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