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5 September 2008

 

ZENTIVA N.V.

UPDATE ON THE EXTRAORDINARY GENERAL MEETING HELD ON 
SEPTEMBER 3, 2008

Zentiva N.V. ('Zentiva' or the 'Company') is pleased to provide the following, more detailed update on its Extraordinary General Meeting of shareholders held in Amsterdam, the Netherlands, on September 3, 2008 (the 'EGM'):

Agenda Item 1 - Opening

Mr. Jiří Michal, the Chairman of the Board of Managing Directors (the 'Board') and the CEO of Zentiva chaired the EGM, as per Article 24 of Zentiva's Articles of Association.

Mr. Petr Šulc, the CFO of Zentiva, was also present at the EGM.

Agenda Item 2 - Announcements

Mr. Krishna van Zundert was appointed as secretary of the EGM.

On the agenda of the EGM, there was one resolution on which shareholders were required to vote; all other agenda items were non-voting. During the EGM, shareholders had an opportunity to ask questions and request clarification as to the relevant agenda points.

Based on pre-EGM registrations, 12,549,319 shares were registered for the EGM, which represented 32.91% of Zentiva's total issued capital.  At the start of the EGM, shareholders in respect of 12,278,463 shares were physically present (either personally or through a proxy) for the EGM, which represented 32.20% of Zentiva's total issued share capital.

Agenda Item 3 - Discussion of the unsolicited voluntary takeover offer published by Sanofi-Aventis Europe

The next agenda item was to discuss the unsolicited voluntary takeover offer published by Sanofi-Aventis Europe. This was a non-voting item.

Mr. Jiří Michal provided the following overview to the shareholders present at the EGM:

'You will recall that on June 17, 2008, Anthiarose Limited, a subsidiary of PPF Group N.V., officially published its unsolicited voluntary takeover offer for Zentiva (the 'PPF Offer'). Shortly after the PPF Offer was published, Zentiva's Board published on June 20, 2008 its position statement with respect to the PPF Offer, and the Board recommended shareholders not to accept the PPF Offer. The PPF Offer was the main topic of our Extraordinary General Meeting which was held on July 9, 2008.

On July 22, 2008, Anthiarose Limited published its intention to withdraw the PPF Offer. Following regulatory clearance, the PPF Offer was officially withdrawn as of July 30, 2008, and is no longer outstanding.

You will also recall that the intention to publish the voluntary takeover offer was published by Sanofi-Aventis Europe on June 18, 2008. Following necessary regulatory processes, Sanofi-Aventis Europe officially published its offer document on July 11, 2008. We will refer to this offer as the 'Sanofi Offer'.

On July 18, 2008 Zentiva's Board published its position statement with respect to the Sanofi Offer. The position statement was also published to provide shareholders with the Board's view on the Sanofi Offer and a detailed analysis of the financial, commercial, and other considerations underlying this view, with the intention to address these matters during this Extraordinary General Meeting, which was convened on August 12, 2008.

In this connection, it is important to mention that two members of Zentiva's Board, Mr. Hanspeter Spek and Mr. Jean-Michel Levy are affiliated with sanofi-aventis. They are executives of sanofi-aventis and were recommended to Zentiva's Board by sanofi-aventis. Both gentlemen informed Zentiva's Board of their actual or potential conflict of interest with respect to both the Sanofi Offer and the PPF Offer. In accordance with the Board's rules and in compliance with good corporate governance practices, they did not receive any relevant documents relating to either the Sanofi Offer or the PPF Offer, did not participate in the Board's discussion, and did not participate in the Board's decision-making.

Since publication of the intention to make the Sanofi Offer, the Board of Zentiva has met regularly to discuss all relevant issues relating to the Sanofi Offer; of course without participation of Messrs. Spek and Levy.

The Board has received extensive legal and financial advice with respect to the Sanofi Offer from reputable advisors. Namely, Merrill Lynch International have acted as financial advisors, and Clifford Chance LLP, Amsterdam, and White & Case, Prague, have acted as legal advisors. In connection with the Sanofi Offer and the Board's position statement on the Sanofi Offer, the Board has received an opinion from Merrill Lynch International on the adequacy of the Sanofi Offer from a financial point of view.

The Board has given due and careful consideration to the strategic, financial and social aspects and consequences of the Sanofi Offer.  Generally, the Board welcomes and appreciates the long term support of any shareholder who is committed to participate actively in the long-term successful future of Zentiva.  However, the Board has reached the conclusion that the Sanofi Offer is not in the best interests of Zentiva, its shareholders, and all its other stakeholders.  The Board is of the opinion that the price being offered per share by Sanofi-Aventis Europe is not adequate as it fails to reflect the underlying value of Zentiva and its future business prospects. The Board unanimously, subject to the conflict of interest issues mentioned earlier, recommends shareholders not to accept the Sanofi Offer.

The rationale for the Board's conclusion is fully stated in the position statement which was published on July 18, 2008 and which is publicly available on our website.'

Petr Šulc, the CFO of the Company, then gave a presentation on the rationale for the Board's conclusion (see slides 9 through 13 of the attached presentation).

Agenda Item 4 - Discussion of potential competing offers, if any, with respect to which the Board's statement will be published prior to the Extraordinary General Meeting

The Chairman of the EGM stated that as of the EGM, there were no outstanding competing offers with respect to which the Board's position would be published prior to the EGM. As explained in the convening notice for the EGM, under these circumstances this agenda item was moot.

Agenda Item 5 - Designation of persons to represent the Company with respect to the decision to make advance payment of expenses in accordance with Article 19(5) of the Articles of Association in case of any legal action relating to takeover offers for the Company

The Chairman of the EGM informed the EGM that according to Article 19(5) of the Articles of Association the Board may decide that the Company pays to its managing director, general proxy holder, officer or agent expenses incurred in defending a civil or criminal action, suit or proceeding in advance of the final disposition of such action, suit or proceeding, provided that the managing director, general proxy holder, officer or agent undertakes to repay such amount if it will ultimately be determined that he/she is not entitled to be indemnified by the Company. 

In light of the heightened profile of and increased demands on the non-conflicted Board members and members of management resulting from the recent takeover offers for the Company the Board deemed it appropriate to decide to make any such advance payments in case any of these persons will become subject of any legal proceeding relating to the takeover offers for the Company. 

As the Company would enter into an agreement with the relevant persons, there was a technical conflict of interest and the Board deemed it appropriate that the shareholders have the opportunity to designate one or more persons to represent the Company in this regard. The Board recommended to shareholders to designate Mr. Jiří Michal and Mr. Brad Wilson, acting jointly, for the above purposes.

The EGM resolved to designate Messrs. Jiří Michal and Brad Wilson, acting jointly, to decide to make advance payment of expenses in accordance with Article 19(5) of the Articles of Association in case of any legal action relating to takeover offers for the Company and to represent the Company with respect to such decision.

The resolution was adopted by more than 99% of votes present at the EGM.

Mr. Michal then closed the EGM.

*    *    *

Annex:        - presentation for the EGM 

Company Contacts		Media Contacts
Petr Šulc Chief Financial Officer Tel: +420 267 242 737 petr.sulc@zentiva.cz	Alexander Marček Corporate Finance Director Tel: +420 267 243 745 alexander.marcek@zentiva.cz	Citigate Dewe Rogerson  Tel: +44 (0)20 7638 9571     David Dible david.dible@citigatedr.co.uk Chris Gardner  chris.gardner@citigatedr.co.uk
Liběna Stiebitzová Investor Relations Tel: +420 267 243 055 Tel: +420 267 243 888 Fax: +420 272 702 869 libena.stiebitzova@zentiva.cz Investor.relations@zentiva.cz	Věra Kudynová PR Manager Tel: +420 267 242 312 vera.kudynova@zentiva.cz

IMPORTANT NOTICES

Forward-looking Statements

This document contains 'forward-looking statements'. These forward-looking statements include all statements that are not historically known facts. They appear in a number of places throughout this document and include, but are not limited to, statements and underlying assumptions regarding Zentiva's intentions, beliefs, projections, plans, objectives, estimates, and current expectations concerning, amongst other things, Zentiva's results of operations, financial condition, liquidity, performance, prospects, growth, strategies, and the countries and industries in which Zentiva operates. Forward-looking statements are generally identified by the words 'expects,' 'anticipates,' 'believes,' 'intends,' 'estimates,' 'plans' and similar expressions. By their nature, forward-looking statements involve risk and uncertainty because they relate to future events and circumstances, many of which are difficult to predict and generally beyond the control of Zentiva. Forward-looking statements are not guarantees of future performance, and the actual results of Zentiva's operations, financial condition, liquidity, performance, prospects, growth, strategies, and the development of the countries and the industries in which Zentiva operates may differ materially from those described in, or suggested by, the forward-looking statements contained in this document. Other than as required by applicable law, Zentiva does not undertake any obligation to update or revise any forward-looking information or statements.

Other Important Notices

This document does not constitute or form part of any offer or invitation to sell or issue, or any solicitation of any offer to purchase or subscribe for, any shares or global depositary shares in Zentiva, nor shall it or any part of it nor the fact of its distribution form the basis of, or be relied on in connection with, any contract or investment decision. 

Recipients of this document, or any part or any copy of it, may not, directly or indirectly, take, or transmit into, or further distribute the document in, the United States, Canada, Australia, or Japan, or to any resident thereof. The distribution of this document in other jurisdictions may also be restricted by law, and persons into whose possession this document comes should inform themselves about, and observe, any such restrictions. Any failure to comply with these restrictions may constitute a violation of US, Canadian, Japanese, Australian or other securities laws.

Zentiva's ordinary shares and global depositary shares have not been and will not be registered under the US Securities Act of 1933 (the 'Securities Act') and may not be offered or sold in the US except pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act.

For the purpose of Section 21 of the Financial Services and Markets Act 2000 of the United Kingdom (the 'FSMA'), any potential invitation or inducement to engage in any investment activity included within this document (which Zentiva believes there is none) is directed only at (i) persons who are investment professionals within the meaning of Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (as amended) of the United Kingdom (the 'Financial Promotion Order'); (ii) persons who fall within Articles 49(2)(a) to (d) ('high net worth companies, unincorporated associations etc.') of the Financial Promotion Order; and (iii) any other persons to whom this document for the purposes of Section 21 of FSMA can otherwise lawfully be made (all such persons together being referred to as 'relevant persons'), and must not be acted on or relied upon by persons other than relevant persons. Any potential invitation or inducement to engage in any investment activity included within this document (which Zentiva believes there is none) is available only to relevant persons and will be engaged in only with relevant persons.

This document is published in both English and Czech version, however, only its English version should be considered the official one. Its Czech version is published solely for information purposes, and no representation is made and no warranty is given as to the accuracy of the Czech translation. Should there be any difference between the English and Czech version of this document, the English version shall always prevail.

NOTE FOR EDITORS

Zentiva N.V. is an international pharmaceutical company focused on developing, manufacturing and marketing modern generic pharmaceutical products. The Company has leading positions in the pharmaceutical markets in the Czech Republic, Slovakia, Romania, and Turkey and is growing rapidly in Poland, Russia, Bulgaria, Hungary, the Ukraine and the Baltic States. Zentiva's strategy is to further this growth by increasing patient access to modern medicines through primary care providers within the EU and Eastern Europe. This growth will be based on further organic development of Zentiva's existing business and through selective acquisitions, whilst maintaining profitable growth.

The Company addresses a wide range of therapeutic areas but has a particular focus on cardiovascular disorders, inflammatory conditions, pain, infections and diseases of the central nervous system and the gastrointestinal and urology fields.

The Zentiva Group employs over 6,000 people and has production sites in the Czech Republic, Slovakia, Romania, and Turkey. 

Zentiva is listed on the Prague and London Stock Exchanges. Based on official notifications by shareholders to the Dutch regulator, the Company's largest shareholders are Sanofi-Aventis (24.9%), PPF Group and Generali PPF Holding B.V. acting in concert (19.2%) and Fervent Holdings Limited (7.6%). Zentiva's management holds 5.9% of the Company shares. Other institutional and private investors hold a combined 42.4% of Company shares.

 

 

http://www.rns-pdf.londonstockexchange.com/rns/8662C_-2008-9-5.pdf

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