Paris, France - May 2nd, 2001
EXHIBIT 99.(a)(10)
PRESS RELEASE... PRESS RELEASE ... PRESS REALESE...
[LOGO OF SODEXHO]
SODEXHO ALLIANCE AGREES TO BUY SODEXHO MARRIOTT SERVICES
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SODEXHO ALLIANCE (EXHO; PARIS) announced today that it has reached an agreement
with Sodexho Marriott Services, Inc. (SDH; NYSE) to acquire all Sodexho Marriott
Services shares it does not already own for $ 32 per share in cash. Based on
33.7 million Sodexho Marriott Services shares held by the public, the total
equity value of the transaction is approximately $ 1 079 million.
Under the agreement, Sodexho Alliance will make a cash tender offer for the
publicly held Sodexho Marriott Services shares followed by a merger. The tender
offer is not subject to any financing condition but is subject to other
customary closing conditions.
Vested employee stock options will be cashed out at their spread value and
unvested options will be rolled over into Sodexho Alliance stock-based awards.
Sodexho Alliance intends to obtain a NYSE listing before the end of the first
calendar quarter of 2002.
Sodexho Alliance has held an approximate 48% interest in Sodexho Marriott
Services since its formation in 1998. On January 24, 2001 Sodexho Alliance made
an acquisition proposal to Sodexho Marriott Services at $ 27 per share. The
Board of Directors of Sodexho Marriott Services designated a Special Committee
of independent directors to evaluate Sodexho Alliance's offer. The current
transaction at $ 32 per share has been approved by the Board of Directors of
Sodexho Marriott Services based on the recommendation of the Special Committee.
On April 6, 2001, Sodexho Alliance announced the acquisition of Sogeres in
France and Wood Dining Services in the United States. Completion remains subject
to customary conditions, including approval by the European Commission and
Federal Trade Commission in the United States.
Sodexho Alliance has arranged new debt facilities required to fund the
acquisition of Sogeres and Wood Dining Services, the 52% of Sodexho Marriott
Services it does not already own together with options cashed out and
transaction fees and, as appropriate, to refinance existing debt of Sodexho
Marriott Services.
Assuming favorable market conditions, Sodexho Alliance intends to raise
approximately Euro 1 billion by way of a rights issue to existing shareholders.
Bellon SA (a 40.2% shareholder of Sodexho Alliance, controlled by the family of
Pierre Bellon, Chairman of Sodexho Alliance) has indicated that it will
subscribe in full for its share of the rights issue.
Since Sodexho Alliance already consolidates Sodexho Marriott Services in its
accounts, upon completion of the above acquisition and refinancing transactions,
the additional debt on Sodexho Alliance's balance sheet will be approximately
Euro 800 million and the debt to equity ratio will be 1.12.
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PRESS RELEASE... PRESS RELEASE... PRESS RELEASE...
As Sodexho Alliance has demonstrated in the past following the acquisition in
1995 of Gardner Merchant (UK, Holland) and Partena (Scandinavia) and in 1998,
when Sodexho Marriott Services was formed, strong and predictable growth in cash
flows should enable the Sodexho Group to deleverage rapidly. Within 3 years,
Sodexho Alliance anticipates returning to its targeted financial ratios : EBITA
greater than 5 times interest expense and debt representing less than 4 years of
cash flow.
In the current market conditions, Sodexho Alliance expects the acquisition of
the Sodexho Marriott Services shares it does not already own to be accretive to
fiscal 2002 and 2003 earnings per share by 6% before goodwill amortization and
neutral after goodwill amortization.
As previously announced, the acquisition of Sogeres and Wood Dining Services is
expected to be accretive to earnings per share in fiscal 2002 and 2003
respectively by 3% and 5% before goodwill amortization and by 1% and 3% after
goodwill amortization.
Pierre Bellon, Chairman of Sodexho Alliance, declared : "These transactions will
allow us to reinforce our worldwide leadership in Food and Management Services
and our position in the segments with the highest potential for growth :
healthcare, seniors and education. Furthermore, the acquisition of 100% of
Sodexho Marriott Services will reinforce group coherence by linking even more
closely Sodexho Alliance and Sodexho Marriott Services associates.
We have the highest regard for and full confidence in the management and
associates of Sodexho Marriott Services. We do not anticipate any change in the
management, strategy or operations of Sodexho Marriott Services."
o O o
US Legend : Sodexho Alliance has not yet commenced the tender offer described in
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this press release. Upon the commencement of the tender offer, Sodexho Alliance
will file a tender offer statement with the Securities and Exchange Commission
(SEC). Sodexho Marriott Services shareholders should read this tender offer
statement when it becomes available, because it will contain important
information. The tender offer statement and other documents filed by Sodexho
Alliance will be available free of charge at the SEC's website
(http://www.sec.gov) and also from the information agent for the offer.