Vesuvius plc Prospectus

Recommendations

Info

5 The receipt of Vesuvius Shares could be a taxable transaction for US persons for US federal income tax purposes The receipt of Alent Shares and Vesuvius Shares by Cookson Shareholders is intended to qualify for non-recognition treatment for US federal income tax purposes under the US Internal Revenue Code of 1986 (the “IRS Code”). Cookson has received an opinion from its tax adviser (the “Opinion”), to the effect that, in the opinion of the tax adviser, the Scheme and the Demerger should satisfy the US federal income tax statutory and regulatory requirements for non-recognition treatment for US persons. The Opinion is based on certain representations made by Cookson and on certain assumptions, and any inaccuracy in the representations made by Cookson or the assumptions could invalidate the Opinion. In addition, Cookson has requested a private letter ruling from the Internal Revenue Service (the “IRS”) that the receipt of Alent Shares and Vesuvius Shares by holders of Cookson Shares along with certain related restructuring transactions will qualify for non-recognition treatment for US federal income tax purposes. There can be no assurance, however, that the IRS will issue its ruling before the date on which the Cookson Shareholders are required to vote on the Proposals, or that the IRS will rule as requested. Furthermore, pursuant to IRS guidelines, the IRS will not rule on whether the Demerger satisfies certain requirements necessary for US persons to obtain non-recognition treatment with respect to the Demerger (the “No Rule Requirements”). Moreover, notwithstanding an eventual private letter ruling, although unlikely, the IRS could determine on audit that the receipt of Alent Shares and/or Vesuvius Shares does not qualify for non-recognition treatment because, for example, one or more facts or representations set forth in the private letter ruling request is not complete or correct, the No Rule Requirements are not satisfied, or as a result of certain actions taken before or after the completion of the Demerger. If it were ultimately determined that the receipt of Alent Shares and/or Vesuvius Shares failed to qualify for non-recognition treatment under the IRS Code, adverse US federal income tax consequences could result for a holder of Cookson Shares who is a US person. A summary of the US federal income tax treatment for US persons of receipt of Alent Shares and Vesuvius Shares pursuant to the Scheme and the Demerger are set out in the section entitled “US Federal Income Tax Considerations” in Part X: “Taxation” of the Cookson Circular. 6 The Demerger may give rise to an unanticipated US tax liability arising to Vesuvius Cookson has undertaken tax due diligence in the US in order to structure the Demerger and any preceding restructuring transactions so that non-recognition treatment for US federal income tax purposes applies, with the result that no tax liability should arise in the US in respect of such transactions. However, tax law and practice can be subject to differing interpretations and, in the event that such non-recognition treatment for US federal income tax purposes does not apply, Vesuvius could have a significant tax liability in the US. To the extent that such non-recognition treatment is not applied as a consequence of certain activities of Alent following Demerger, the provisions of the Tax Sharing and Indemnification Agreement (described in paragraph 13.6 in Part XIII: “Additional Information” of this document and in the risk factor in paragraph 8 below) should generally require Alent plc to indemnify Vesuvius plc for such liability. To the extent that such tax liability arises otherwise than as a result of such activities, no indemnity will apply. 7 The Demerger may give rise to other unanticipated tax consequences Cookson has undertaken tax due diligence to identify the likely tax treatment of the Demerger and has structured the Demerger so as to reduce any adverse tax consequences. However, tax law and practice can be subject to differing interpretations and, in some jurisdictions, the tax authorities are entitled to exercise discretion in how the tax law should be applied in certain cases. Consequently, Vesuvius is not able to guarantee that the tax authorities in each jurisdiction in which companies in Vesuvius have a taxable presence will interpret or apply the relevant tax law and practice in the manner in which Vesuvius anticipates and this may give rise to adverse consequences. Details of the United Kingdom, United States and Jersey tax treatment of shareholders arising under the Scheme and the Demerger are set out in the sections entitled “United Kingdom Taxation”, “US Federal Income Tax Considerations” and “Jersey Taxation” in Part XI: “Taxation Considerations” of this document. 8 Vesuvius could have significant indemnification obligations to Alent as a result of the Proposals, including with respect to US tax liabilities Alent plc and Vesuvius plc have entered into certain Separation Agreements, as described in paragraph 13 in Part XIII: “Additional Information” of this document, that govern the allocation of the assets and liabilities of the businesses, and their post-Demerger obligations to each other in respect of, among other 18
things, taxes and transitional services. Under the terms of the Demerger Agreement, each of Alent plc and Vesuvius plc has agreed to indemnify the other in respect of liabilities incurred by members of their respective groups following the Demerger Effective Time which relate to the Alent Business and Vesuvius Business, respectively. The amounts payable by Alent plc and Vesuvius plc to the other pursuant to such indemnity obligation could be significant. Vesuvius plc has also, under the terms of the Tax Sharing and Indemnification Agreement and subject to certain conditions, agreed to indemnify Alent plc for taxes imposed on Alent that are attributable to certain restructuring transactions undertaken in anticipation of the Demerger (including the Reorganisation). The tax liabilities that could arise were a taxing authority successfully to challenge the treatment of the restructuring transactions could be significant. However, in the event of a change of control of Alent plc (i.e. more than 50 per cent. of the shares in Alent plc being acquired by a third party), the obligations of Vesuvius plc to indemnify Alent plc for additional taxes in respect of the restructuring and other transactions may terminate, to the extent that such taxes are attributable to that change of control. As described in paragraph 4 of Section B of Part IV of the Cookson Circular, were members of Alent to take certain actions that might result in the Demerger and preceding restructuring transactions failing to qualify for non-recognition treatment for US federal income tax purposes, Alent plc may be required to indemnify Vesuvius plc for liabilities that are incurred as a result of such failure. Even if such a liability were to arise, based on valuations provided by its advisers, Vesuvius expects that any such liability would not be significant. However, these valuations could be subject to differing interpretations and, as a result, there is no guarantee that they could not be successfully challenged by a tax authority. Were that to be the case, Vesuvius could have a significant tax liability for which indemnification would be sought from Alent plc. SECTION C: RISKS RELATING TO THE VESUVIUS SHARES 1 The price of the Vesuvius Shares may be volatile The price of the Vesuvius Shares following Vesuvius Admission could be subject to significant fluctuations due to the volatility of the stock market in general and a variety of other factors, some of which are beyond Vesuvius’ control, including the other risks relating to an investment in Vesuvius described in this section. The fluctuations could result from national and global economic and financial conditions, the market’s response to the Demerger, market perceptions of Vesuvius, including its ability to manage its existing debt facilities and raise new capital, regulatory changes affecting its operations, variations in Vesuvius’ operating results, business developments and/or its competitors and liquidity of financial markets. Furthermore, the operating results and prospects from time to time may be below the expectations of market analysts and investors. Any of these events could result in a decline in the market price of the Vesuvius Shares. 2 Any future equity issues by Vesuvius plc could have an adverse effect on the market price of the Vesuvius Shares and could dilute ownership Other than the proposed issue of shares under the Proposals, Vesuvius plc has no current plans for an offering of its shares. However, it is possible that Vesuvius plc may decide to issue additional shares in the future and, if shareholders did not take up such offer or were not eligible to participate, their proportionate ownership and voting interests in Vesuvius plc would be reduced and the percentage that their shares would represent of the total share capital of Vesuvius plc would be reduced accordingly. A future equity issue, or significant sale of Vesuvius Shares by major shareholders, could have a material adverse effect on the market price of Vesuvius Shares as a whole. 3 Any change in current tax law or practice could adversely affect holders of Vesuvius Shares Statements in this document concerning the taxation of holders of Vesuvius Shares are based on current UK, US and Jersey tax law and practice as at the date of this document, each of which is subject to change, possibly with retrospective effect. The taxation of an investment in Vesuvius Shares depends on the individual circumstances of the Vesuvius Shareholder and the summary of the UK, US and Jersey taxation treatment of an investment in the Vesuvius Shares set out in Part XI: “Taxation Considerations” of this document is intended as a general guide only. It does not address the specific tax position of every investor and only deals with rules of UK, US and Jersey taxation of general application. Therefore, any investors who are in any doubt as to their tax position regarding the Vesuvius Shares and any investors subject to tax in any other jurisdiction should consult their own independent tax advisers. 19
Page 1 and 2: Prospectus dated 1 November 2012 TH
Page 3 and 4: The Vesuvius Shares have not been a
Page 5 and 6: PART I SUMMARY Summaries are made u
Page 7 and 8: Element Disclosure requirement B.6
Page 9 and 10: Element Disclosure requirement SUMM
Page 11 and 12: Element Disclosure requirement Sect
Page 13 and 14: PART II RISK FACTORS In addition to
Page 15 and 16: provided by former owners of certai
Page 17: will remain with Vesuvius and all p
Page 21 and 22: PART III IMPORTANT INFORMATION Pres
Page 23 and 24: (b) determine that such Vesuvius Sh
Page 25 and 26: (2) If either the Court Meeting or
Page 27 and 28: SPONSOR AND FINANCIAL ADVISER Roths
Page 29 and 30: PART VII INFORMATION ON VESUVIUS Yo
Page 31 and 32: 80 70 60 50 40 30 20 10 0 Source WS
Page 33 and 34: Foundry division sales (£ per tonn
Page 35 and 36: extreme thermo-mechanical stresses
Page 37 and 38: facilities in, for example, Poland,
Page 39 and 40: customer base is evidenced by the f
Page 41 and 42: 28 per cent. of Vesuvius’ revenue
Page 43 and 44: 2.2.4 Funding of PMP inventory In l
Page 45 and 46: PART VIII OPERATING AND FINANCIAL R
Page 47 and 48: Vesuvius’ products are largely si
Page 49 and 50: Net sales value Net sales value is
Page 51 and 52: For the year ending 31 December 201
Page 53 and 54: continued into 2012 with demand for
Page 55 and 56: Following the Demerger, the UK Plan
Page 57 and 58: 1.4 Results of operations FY 2009 F
Page 59 and 60: The Foundry business facility in Pi
Page 61 and 62: Vesuvius has a policy of broadly ma
Page 63 and 64: Headline profit before tax Headline
Page 65 and 66: in the historical financial informa
Page 67 and 68: Net profit on disposal of continuin
Page 69 and 70:
3 Liquidity and capital resources T
Page 71 and 72:
Acquisition of subsidiaries: a cash
Page 73 and 74:
3.1.3 Comparison of the year ended
Page 75 and 76:
3.3 Indebtedness HY 2011 (unaudited
Page 77 and 78:
4.3 Liquidity risk Liquidity risk i
Page 79 and 80:
stream of income exactly matching f
Page 81 and 82:
PART IX HISTORICAL FINANCIAL INFORM
Page 83 and 84:
Statement of comprehensive income H
Page 85 and 86:
Balance sheet Notes HY 2011 HY 2012
Page 87 and 88:
Notes to the condensed financial st
Page 89 and 90:
6 Amortisation of intangible assets
Page 91 and 92:
For the purposes of calculating dil
Page 93 and 94:
15 Exchange rates Vesuvius reports
Page 95 and 96:
SECTION B: AUDITED CONSOLIDATED FIN
Page 97 and 98:
Statement of cash flows FY 2009 FY
Page 99 and 100:
Changes in invested capital FY 2009
Page 101 and 102:
2.2 Other principles applied In add
Page 103 and 104:
• The estimates and underlying as
Page 105 and 106:
(b) Deferred tax Vesuvius has recog
Page 107 and 108:
5.2 Business segments For reporting
Page 109 and 110:
5.4 Geographic analysis of external
Page 111 and 112:
10 Finance costs and finance income
Page 113 and 114:
FY 2009 FY 2010 FY 2011 (£m) Excep
Page 115 and 116:
From 1 April 2012, the UK corporati
Page 117 and 118:
15 Reconciliation of movement in ne
Page 119 and 120:
Freehold property Leasehold propert
Page 121 and 122:
FY 2009 FY 2010 FY 2011 (£m) Steel
Page 123 and 124:
historical loss experience. Histori
Page 125 and 126:
ate swaps designated as cash flow h
Page 127 and 128:
• to have available the necessary
Page 129 and 130:
The tables below show the net unhed
Page 131 and 132:
charged in the income statement and
Page 133 and 134:
In July 2010 the UK government anno
Page 135 and 136:
(b) Other principal actuarial valua
Page 137 and 138:
25.4 Defined benefit obligation The
Page 139 and 140:
Defined benefit pension plans Other
Page 141 and 142:
26 Share-based payments In accordan
Page 143 and 144:
28.2 Operating lease commitments FY
Page 145 and 146:
31 Dividends FY 2009 FY 2010 FY 201
Page 147 and 148:
The acquisition of Metallurgica was
Page 149 and 150:
(2) The annual incentive bonuses aw
Page 151 and 152:
Allocations outstanding as at 1 Jan
Page 153 and 154:
Nick Salmon Allocations outstanding
Page 155 and 156:
mid-market closing price of Cookson
Page 157 and 158:
Declaration For the purposes of Pro
Page 159 and 160:
Notes: (1) The financial informatio
Page 161 and 162:
Our work has not been carried out i
Page 163 and 164:
Non-United Kingdom resident shareho
Page 165 and 166:
is subject to US federal income tax
Page 167 and 168:
PART XII DIRECTORS, RESPONSIBLE PER
Page 169 and 170:
3 Directors’ interests 3.1 Direct
Page 171 and 172:
The overall intention is that this
Page 173 and 174:
François Wanecq François Wanecq i
Page 175 and 176:
7.3 Board committees The principal
Page 177 and 178:
Vesuvius Director Current directors
Page 179 and 180:
PART XIII ADDITIONAL INFORMATION 1
Page 181 and 182:
as if section 561(1) of the Compani
Page 183 and 184:
2.10 The Vesuvius Shares are in reg
Page 185 and 186:
meeting of the holders of the share
Page 187 and 188:
Vesuvius Directors may be appointed
Page 189 and 190:
Any Director who holds any executiv
Page 191 and 192:
6.2 Save as disclosed in this parag
Page 193 and 194:
9.1.4 Cookson stakeholder scheme Th
Page 195 and 196:
There are two types of award that t
Page 197 and 198:
discretionary bonus under any discr
Page 199 and 200:
Participants who, at the request of
Page 201 and 202:
Restricted share awards These are s
Page 203 and 204:
If a participant ceases employment
Page 205 and 206:
consigned precious metals is establ
Page 207 and 208:
14 Significant subsidiaries and joi
Page 209 and 210:
18.5 Rothschild, whose address is N
Page 211 and 212:
PART XV DEFINITIONS The following d
Page 213 and 214:
Cookson Shares the ordinary shares
Page 215 and 216:
Pension Insurance Corporation Pensi
Page 217 and 218:
Vesuvius Articles the articles of a
Page 219 and 220:
SOLAR CRUCIBLE a brand name for a l
Page 222:
Printed by RR Donnelley 410488
show all

Vesuvius plc Prospectus

You also want an ePaper? Increase the reach of your titles

Delete template?

Save as template?