Hampson Industries PLC : - Interim Management Statement

The distribution of this announcement in jurisdictions outside the United Kingdom may be restricted by law and therefore persons into whose possession this announcement comes should inform themselves about, and observe, such restrictions.

14 February 2012

Hampson Industries PLC

Interim Management Statement and Strategy Update / Commencement of Formal Sale Process

Hampson Industries PLC ("Hampson" or "the Group"), the international aerospace group, today issues the following interim management statement covering the period from 1 October 2011 to date and announces the commencement of a Formal Sale Process in relation to the Group.

Revenue for the Group as a whole for the period to 5 February 2012 was £55.6 million. The Group's order books were £120.7 million as at that date (30 September 2011: £119.0 million).

Tooling

The Tooling division is comprised of Coast Composites Inc. ("Coast"), Global Tooling Systems Inc. ("GTS") and Odyssey Industries Inc ("Odyssey").

Revenues for the period at the Tooling division were £39.8 million. The order book for the Tooling division at 5 February 2012 was £57.3 million.

Issues have been identified during the testing and customer approval process for the Group's largest tooling order, which mean that some deliveries are now expected to move from fiscal year 2012 to 2013.  The Group is assessing the overall effect on revenue and profit in the light of on-going discussions with the customer.

Management actions at Odyssey have resulted in trading at or above breakeven in each of the last three months.

Aerostructures & Composites

The Aerostructures & Composites division is comprised of Composites Horizons Inc.("CHI"), Texstars Inc. ("Texstars"), BHW (Components) Limited ("BHW"), and the Group's Indian operations ("India"). 

The revenues in this segment for the period were £15.8 million as a result of continued strong activity at CHI and improved volumes at Texstars. The order book for this division at 5 February 2012 was £63.4 million.

Further to Hampson's announcement on 16 November 2011, the Group has been exploring strategic options for its BHW and India operations.  Whilst discussions remain at a relatively early stage, indicative offers have been received for the businesses.

Indebtedness

In October 2011, the Group completed the disposal of the Shims businesses for gross proceeds of £51.5 million. In December 2011, the Group settled a legal dispute with an immediate cash benefit of approximately £1.6 million.  Following these events thenet debt at 5 February 2012 was £54.9 million. The tooling delays mentioned above have resulted in an increase in working capital and borrowings, which is expected to continue in the short term.

Review of Strategic Options / Commencement of Formal Sale Process

The Group continues to focus on refinancing its bank facilities. The Board of Hampson also believes it to be prudent to review actively all financing and strategic options, including a sale of the Group and is therefore announcing the commencement of a formal sale process. 

In the context of a potential sale of the Group, the Board has appointed DC Advisory Partners and Sagent Advisors Inc. to conduct a formal sale process for the entire issued or to be issued share capital of Hampson as part of the assessment of strategic options.   

Potential offerors for the entire issued and to be issued share capital of Hampson should contact either DC Advisory Partners or Sagent Advisors Inc. (contact details as set out below).  Any interested party will be required to enter into a non-disclosure agreement with the Group on reasonable terms satisfactory to the Board and on the same terms, in all material respects, as the other interested parties, before being permitted to participate in the process.  Following execution of an agreed non-disclosure agreement, the Group intends to provide interested parties with information materials on the Group.  Following receipt of the materials, interested parties shall be invited to submit an indicative offer for the Group.  Interested parties who submit an indicative offer acceptable to the Board will be invited into the next phase of the process.

The Board reserves the right to alter any aspect of the sale process as outlined above or to terminate it at any time and will make further announcements as appropriate.  The Board reserves the right to reject any approach or terminate discussions with any interested party or participant at any time.

The Takeover Panel has granted a dispensation from the requirements of Rules 2.4(a), 2.4(b) and 2.6(a) of the Takeover Code (the "Code") such that any interested party participating in the formal sale process will not be required to be publicly identified as a result of this announcement (subject to note 3 to Rule 2.2 of the Code) and will not be subject to the 28 day deadline referred to in Rule 2.6(a), for so long as it is participating in the formal sale process. Interested parties should note Rule 21.2 of the Code, which will prohibit any form of inducement fee or other offer-related arrangement, and that the Group has not requested any dispensation from this prohibition under Note 2 of Rule 21.2 at this stage.

Following this announcement, the Group is now considered to be in an "offer period" as defined in the Code, and the dealing disclosure requirements listed below will apply.

Further information:

Hampson

John Poulter, Non-Executive Chairman                                              [phone]

Norman Jordan, Chief Executive                                                              [phone]

Ram Swamy, Finance Director                                                          [phone]

DC Advisory Partners                                                                    [phone]

Andrew Cunningham                                                                    

Dafydd Evans                                                                            

Michelle Le Merre

Sagent Advisors Inc.                                                                            [phone]

Omar Namoos

Michael Hart

Brent Surber

M: Communications

Ann-marie Wilkinson/Maria Souvorov                                                  [phone]

A copy of this announcement will be available atwww.hampsongroup.com . The content of the website referred to in this announcement is not incorporated into and does not form part of this announcement.

This announcement is not intended to, and does not, constitute or form part of any offer, invitation or the solicitation of an offer to purchase, otherwise acquire, subscribe for, sell or otherwise dispose of, any securities whether pursuant to this announcement or otherwise. The distribution of this announcement in jurisdictions outside the United Kingdom may be restricted by law and therefore persons into whose possession this announcement comes should inform themselves about, and observe such restrictions. Any failure to comply with the restrictions may constitute a violation of the securities law of any such jurisdiction.

Rule 2.10 disclosure

In accordance with Rule 2.10 of the Code, the Group confirms that it has 279,296,023ordinary shares of £0.25 each in issue and admitted to trading on the main market of the Stock Exchange with the ISIN GB00B0P8RT68.

Disclosure requirements of the Takeover Code (the "Code")

Under Rule 8.3(a) of the Code, any person who is interested in 1% or more of any class of relevant securities of an offeree company or of any paper offeror (being any offeror other than an offeror in respect of which it has been announced that its offer is, or is likely to be, solely in cash) must make an Opening Position Disclosure following the commencement of the offer period and, if later, following the announcement in which any paper offeror is first identified. An Opening Position Disclosure must contain details of the person's interests and short positions in, and rights to subscribe for, any relevant securities of each of (i) the offeree company and (ii) any paper offeror(s). An Opening Position Disclosure by a person to whom Rule 8.3(a) applies must be made by no later than 3.30 pm (London time) on the 10th business day following the commencement of the offer period and, if appropriate, by no later than 3.30 pm (London time) on the 10th business day following the announcement in which any paper offeror is first identified. Relevant persons who deal in the relevant securities of the offeree company or of a paper offeror prior to the deadline for making an Opening Position Disclosure must instead make a Dealing Disclosure.

Under Rule 8.3(b) of the Code, any person who is, or becomes, interested in 1% or more of any class of relevant securities of the offeree company or of any paper offeror must make a Dealing Disclosure if the person deals in any relevant securities of the offeree company or of any paper offeror. A Dealing Disclosure must contain details of the dealing concerned and of the person's interests and short positions in, and rights to subscribe for, any relevant securities of each of (i) the offeree company and (ii) any paper offeror, save to the extent that these details have previously been disclosed under Rule 8. A Dealing Disclosure by a person to whom Rule 8.3(b) applies must be made by no later than 3.30 pm (London time) on the business day following the date of the relevant dealing.

If two or more persons act together pursuant to an agreement or understanding, whether formal or informal, to acquire or control an interest in relevant securities of an offeree company or a paper offeror, they will be deemed to be a single person for the purpose of Rule 8.3.

Opening Position Disclosures must also be made by the offeree company and by any offeror and Dealing Disclosures must also be made by the offeree company, by any offeror and by any persons acting in concert with any of them (see Rules 8.1, 8.2 and 8.4).

Details of the offeree and offeror companies in respect of whose relevant securities Opening Position Disclosures and Dealing Disclosures must be made can be found in the Disclosure Table on the Takeover Panel's website atwww.thetakeoverpanel.org.uk , including details of the number of relevant securities in issue, when the offer period commenced and when any offeror was first identified. You should contact the Panel's Market Surveillance Unit on [phone] if you are in any doubt as to whether you are required to make an Opening Position Disclosure or a Dealing Disclosure.