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  • Acquisition of TNT Business Solutions and Placing of new Ordinary Shares to raise up to 51.5 million

    Restore plc ("Restore" or the "Company"), the UK office services provider, today announces that it has entered into an agreement to acquire TNT Business Solutions ("TNT BS"), the records management business of TNT UK Limited, for a total consideration of 88 million, on a cash and debt free basis (the "Acquisition"). Completion is scheduled for 1 May 2018.

    The Company also announces a placing, conditional on the completion of the Acquisition, with institutional investors to raise up to 51.5 million before expenses (the "Placing") through the issue of up to 10,100,000 new ordinary shares of 5 pence each (the "Placing Shares") at 510 pence (the "Placing Price") per Placing Share. The Placing was significantly oversubscribed with demand from new and existing institutional shareholders.

    The Acquisition will be financed partly from the funds raised by the Placing and partly through new debt facilities with Barclays, Royal Bank of Scotland, Lloyds Bank and Bank of Ireland. These new facilities comprise a 160 million Revolving Credit Facility, with an additional 30 million accordion facility.

    Background to and reasons for the Acquisition
    TNT BS operates from five sites in the Midlands and the outskirts of London, including two freehold sites at Swadlincote, Derbyshire and Thurrock, Es***. These sites are operating at close to full capacity utilisation overall. TNT BS currently employs over 250 staff, who will transfer to Restore upon completion of the Acquisition.

    The Acquisition will further strengthen the Company's position in UK records management, particularly with public sector customers who represent the majority of TNT BS's revenues. It is expected that there will be operational and property synergies deriving from the Acquisition, as well as cross-selling opportunities. Key management is expected to remain with the business, and the Acquisition is expected to be earnings enhancing.

    About TNT BS
    TNT BS is a trading subdivision of TNT UK Limited whose ultimate owner is FedEx Corporation (NYSE: FDX) of Memphis, Tennessee. TNT BS primarily provides records management services and also has a presence in scanning. The Acquisition is an asset purchase and accordingly the financial information set out below has been extracted from the unaudited management information of TNT UK Limited.