MINISTRY OF DEFENCE
News Release (204/2008) issued by COI News Distribution Service. 9
September 2008
The Ministry of
Defence (MOD) announced today the sale of its remaining ordinary
shares in QinetiQ Group plc at a price of 206 pence per share.
Minister for Defence Equipment and Support Baroness Taylor said:
"I am pleased to announce that with this sale of shares in
QinetiQ we have completed the final stage of its privatisation.
Ten years ago our in-house defence laboratories faced a difficult
and uncertain future. The privatisation of QinetiQ transformed it
into a successful British-based company employing around 13,000
people, and raised £830m for the taxpayer.
QinetiQ and its staff can be rightly proud of what the company
has achieved since it was created in 2001. They remain a very
important supplier to the MOD and we wish them every success.
Although we no longer have a financial stake in QinetiQ, we will
retain a special share in the company to protect the UK's
defence and security interests."
Notes to Editors
1. Since 2001, QinetiQ has been transformed from the MOD's
in-house research and development organisation into an
international defence and security company. A fact sheet is
available online on the MOD website: http://www.mod.uk/DefenceInternet/FactSheets/ModAndQinetiq.htm
2. The MOD's entire holding of ordinary shares in QinetiQ,
comprising 124,885,445 ordinary shares were successfully placed
with investors. This represents, in aggregate, approximately 18.9%
of QinetiQ's current issued ordinary share capital. The
shares were placed with investors at a price of 206 pence per
share, raising over £254m (net of estimated costs) for the
taxpayer. The QinetiQ share price closed at 223.5 pence per share
on 8 September 2008, the day before the placing. The offering
price represented a 7.8% discount to this share price. A discount
is customary for transactions of this scale. The weighted average
price per share since QinetiQ's flotation on the stock
exchange has been 194 pence.
3. The MOD also retains a special share which is independent of
its financial stake in the company. This allows the MOD to
prevent individuals or organisations that could represent a threat
to UK defence and security interests or pose a conflict of
interest (e.g. defence manufacturers) from acquiring a significant
stake in the company. It also ensures that MOD customers will
continue to be able to use QinetiQ as a source of impartial advice.
4. QinetiQ was floated on the stock market in February 2006 at a
price of 200 pence per share. In February 2007, The Carlyle Group
(who were MOD's strategic partner in the privatisation
process) sold its remaining stake in QinetiQ for 205 pence per share.
5. Credit Suisse Securities (Europe) Limited, JPMorgan Cazenove
Limited and Merrill Lynch International acted as joint global
co-ordinators and bookrunners, and N M Rothschild & Sons
Limited acted as independent financial adviser, to the MOD in
respect of the placing. Credit Suisse Securities (Europe)
Limited, JPMorgan Cazenove Limited, Merrill Lynch International
and N M Rothschild & Sons Limited are acting for the MOD only
in connection with the placing, and no one else, and will not be
responsible to anyone other than the MOD for providing the
protections offered to clients of Credit Suisse Securities
(Europe) Limited, JPMorgan Cazenove Limited, Merrill Lynch
International and N M Rothschild & Sons Limited nor for
providing advice in relation to the placing.
PRESS RELEASE
Defence Press Office
1st Floor, Zone B,
Ministry of
Defence,
Main Building,
Whitehall,
London SW1A 2HB