AS ESS

TEADE

07.12.98

 

 

OFFERING TO SMALL SHAREHOLDERS

 

AS Hansapank informed the Management Board of AS ESS about its 

client's proxy to make to the ESS shareholders a purchase 

offering for the ESS shares. The following is a text of the 

presented offering:

______________________________________________________________

 

 

Tallinn, December 7, 1998

 

OFFERING

 

Conditions of the offering

 

On the mediation of Hansapank, OÜ ESS Investeering presents 

hereby to the ESS shareholders the purchase offering for ESS 

shares on the following conditions:

 

1. The offering is valid from the announcement of December 7, 

1998, until January 4, 1998, at 14:00 PM. 

 

2. OÜ ESS Investeering will purchase the AS ESS shares from the 

shareholders with the price of 62.30 EEK / per share. 

 

3. The offering is valid for all the AS ESS shares owned by small 

shareholders*. 

 

* - own less than 5% of the company’s shares

 

4. The value date of the offering is 07.01.99. On the value date 

of the offering, monetary transactions and transference of the 

shares will take place.

 

5. In case the shareholder is willing to make a contract on the 

conditions of the offering, the shareholder must go the 

account operator bank where he/she holds the ESS shares, and 

register the transaction order for the sale of the AS ESS 

shares.

 

The transaction order must be presented to the securities 

account operator bank by January 4, 1999, 14:00 PM at the 

latest, including the following information: 

 

Share				__AS ESS shares

ISIN code			EE3100003252

Price per share			62.30 EEK

Counterpart			OÜ ESS Investeering

Counterpart’s account operator	E767

Value date of transaction	7.January 1999

Transaction's settling type	"DVP"

 

 

Grounds of the offering

 

OÜ ESS Investeering makes a share purchase offer to the small 

shareholders  on the above conditions, which is the second public 

offering made to the small shareholders of AS ESS. 

 

In the course of the first offering (12.-20.November 1998), AS 

Hansapank made an offering on the account of a client to 95,000 

AS ESS shares at the price of 62.30 EEK per share. The small 

shareholders sold 39,902 shares, which is 3.44% of the company’s 

share capital.

 

After the end of the first offering, several influential events 

have taken place, which enable us to explain the reasons and 

purposes of the given offering to the small shareholders. This 

will provide more information to the small shareholders to decide 

whether to respond to the given offering or not.

 

On the general meeting of the shareholders on June 22, 1998, the 

AS ESS shareholders decided to issue up to 550,000 new shares to 

the strategic investor. With this decision, the major 

shareholders of the company expressed their willingness to 

include a strong partner, who is able to support the company’s 

development also in the worsened economic environment.

 

After the decision of the general shareholders’ meeting, the 

Board and major shareholders of AS ESS held negotiations with 

several security groups from Scandinavian and Western European 

countries until the end of November. It became evident in the 

course of the negotiations that none of the potential investors 

are interested in holding minority interest in a company and 

listing the shares on the Tallinn Stock Exchange.

 

Coming from the information obtained in the course of the 

negotiations, one of the major shareholders of AS ESS announced 

already in October that the company is planning to apply for 

delisting its shares from the Tallinn Stock Exchange as soon as 

1998. After consulting with major shareholders, the respective 

application to delist AS ESS shares already from November 30, 

1998, was presented by the AS ESS Management Board on November 

20.

 

As a result of successful negotiations, OÜ ESS Investeering made 

on November 30, 1998, a contract to sell 65% of AS ESS shares to 

the international security group Falck, which is registered in 

Denmark.

 

Considering that the shares of Falck are listed on the Copenhagen 

Stock Exchange and that the strategy of Falck does not foresee 

the listing of the subsidiaries on the stock exchanges, Falck is 

also not interested in listing AS ESS shares.

 

On December 1, 1998, after the sale of 65% of the shares to Falck 

and reception of additional information, the TSE Listing 

Committee decided to approve conditionally the AS ESS application 

to delist the company’s shares from the Tallinn Stock Exchange. 

The Listing Committee’s decision will come to force after meeting 

the following conditions:

1. The majority shareholder (or shareholders) will make an at 

least 3-week period offer to small shareholders with at least 

equivalent conditions to those of an initial offer;

2. The shareholders’ structure will be disclosed as after the 

transition of a controlling share to Falck Group.

 

The first condition is met with the given offering. 

 

As of December 4, 1998, the public holds significantly less than 

25% of the AS ESS shares, and the company has less than 100 

shareholders. Basically non-existent trade in AS ESS shares 

during the whole year of 1998 confirms that there is no 

significant interest towards the ESS shares on the stock 

exchange.

 

Therefore, the small investors have no opportunity to influence 

the management of a company and decision-making on the general 

meetings of the shareholders, and after delisting the company’s 

shares from the Tallinn Stock Exchange, the small shareholders’ 

possibilities to sell the shares on the stock exchange on the 

satisfying conditions decrease. Also, considering the major 

planned investments, the major shareholders of the company do not 

guarantee the payment of the dividends.

 

Coming from the above-mentioned circumstances, good traditions 

and the requirements of the TSE Listing Committee, OÜ ESS 

Investeering finds that the conditions of the given offering are 

fair to the small shareholders, enabling them to sell the shares 

owned by them within 4 weeks at a fair price.

 

Therefore, OÜ ESS Investeering finds that with the given 

offering, the major shareholders fulfill their obligations toward 

the small shareholders, and they will not accept further 

responsibilities to the small shareholders, except what is 

determined by the law. 

 

Also the Listing Committee of the Tallinn Stock Exchange found 

that in a present justice environment, AS ESS and its major 

shareholders have acted in a way which can be considered as 

protective on an acceptable level toward the small shareholders’ 

interests. 

 

 

Additional information:

 

Helen Poolake

Hansapank

Tel: +372 6 133 515

 

 

Indrek Lindsalu

PR manager

+372 6 266 700