TIDMARP
RNS Number : 2150S
Ashcourt Rowan PLC
16 November 2011
16 November 2011
NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN WHOLE OR IN
PART, DIRECTLY OR INDIRECTLY, IN, INTO OR FROM THE UNITED STATES,
AUSTRALIA, CANADA, REPUBLIC OF IRELAND, REPUBLIC OF SOUTH AFRICA OR
JAPAN OR ANY OTHER JURISDICTION IN WHICH THE RELEASE, PUBLICATION
OR DISTRIBUTION WOULD BE UNLAWFUL
ASHCOURT ROWAN PLC
("Ashcourt Rowan" or the "Company")
Placing to raise GBP8.5 million
Share Consolidation
Reduction of Share Premium Account
and
Notice of General Meeting
Ashcourt Rowan plc (AIM: ARP.L), the UK wealth management group,
announces that it has conditionally placed 8.5 million New Ordinary
Shares ("Placing Shares") at a price of 100 pence per New Ordinary
Share ("Placing Price"), raising gross proceeds of GBP8.5 million
(approximately GBP8.06 million net of expenses) by way of a
Placing, from both new and existing institutional and other
investors (including senior management).
As part of the Proposals, the Company is proposing to undertake
a share consolidation pursuant to which Ordinary Shares of GBP0.002
each will be consolidated into New Ordinary Shares of GBP0.20 each.
In addition, the Company is also proposing a reduction of its share
premium account.
The Proposals (including the Placing) are conditional, inter
alia, on the approval by Shareholders in a general meeting. The
Board has convened a General Meeting to approve matters necessary
to implement the Proposals on 2 December 2011. A circular setting
out the details of the Placing (the "Circular"), incorporating a
notice convening the General Meeting, will be posted to
shareholders today. The Circular and the Form of Proxy are
available on the Company's website www.ashcourtrowan.com.
Shareholders representing approximately 59 per cent. of the
Company's issued share capital have indicated their intention to
support the Proposals.
Canaccord Genuity Limited is acting as sole placing agent,
nominated adviser and broker in relation to the Placing and
admission of the Placing Shares.
Summary of the Placing:
* Placing of 8.5 million New Ordinary Shares at a
Placing Price of 100 pence per New Ordinary Share, to
raise gross proceeds of GBP8.5 million (GBP8.06
million, net)
* Net proceeds of the Placing to be used to
* Undertake significant cost reductions which, when
fully implemented, should result in annual cost
savings of GBP5.2 million
* Strengthen the balance sheet of the Company and
improve its regulatory capital position
* Develop a "best of breed" investment management
proposition
* Establish a common operating platform which is
scaleable
* Formalise arrangements in relation to certain assets
managed under the Company's Savoy brand
* The Placing Price represents a discount, calculated
on a pre-consolidation basis, of 16.7 per cent. to
the closing middle market price of 1.2 pence per
Ordinary Share on 15 November 2011, being the latest
practicable date prior to this announcement
* The Placing Shares will represent approximately 31.6
per cent. of the Company's enlarged issued share
capital
* Implementation of planned initiatives will lead to an
integrated Ashcourt Rowan operating model and, the
Directors believe, will greatly assist in unlocking
the latent value in the business
The Circular also sets out the Company's proposals to undertake
a Share Consolidation and reduce the Company's share premium
account, the principal effect of which will be to place the Company
in a position where (subject to any undertakings that the Company
may be required to give to the Court) it can lawfully purchase its
own shares and/or pay dividends out of distributable profits sooner
than it would otherwise be able to do so.
Jonathan Polin, the recently appointed CEO of the Company, said
"We are pleased that shareholders are fully behind the Board in its
efforts to deliver material and sustainable improvements in the
profitability of the Company and appreciate the strong support from
existing shareholders and new investors through their participation
in the placing which was over subscribed."
Information extracted from the Circular is set out below.
For further information please contact:
Jonathan Polin, CEO Ashcourt Rowan plc
jonathanpolin@ashcourtrowan.com www.ashcourtrowan.com +44 (0) 20 7871 7373
Gordon Neilly +44 (0) 20 7050 6778
gneilly@canaccordgenuity.com
Sue Inglis +44 (0) 20 7050 6779
singlis@canaccordgenuity.com
Rishi Zaveri Canaccord Genuity Limited
rzaveri@canaccordgenuity.com www.canaccordgenuity.com +44 (0) 20 7050 6780
Media enquiries:
MRM London
Andrew Appleyard www.mrm-london.com MRM +44 (0) 20 3326 9908
Notes:
This announcement is for information purposes only and does not
constitute an offer or invitation to acquire or dispose of any
securities or investment advice in any jurisdiction.
Canaccord Genuity Limited, which is authorised and regulated in
the United Kingdom by the Financial Services Authority, is acting
as sole placing agent as well as nominated adviser and broker for
the purposes of the AIM Rules exclusively for the Company in
connection with the Placing and Admission. Canaccord Genuity
Limited is not acting for any other person and will not be
responsible to any other person for providing the protections
afforded to clients of Canaccord Genuity Limited or for advising
any other person in connection with the Placing and Admission.
No representation or warranty, express or implied, is made by
Canaccord Genuity Limited or any of their respective directors,
officers, employees, advisers or agents as to any of the contents
of this announcement and, without limiting the statutory rights (if
any) of any person to whom this announcement is issued, no
liability whatsoever is accepted by Canaccord Genuity Limited or
any of their respective directors, officers, employees, advisers or
agents for the accuracy of any information or opinions contained in
this announcement or for the omission of any material
information.
The information contained in this announcement is not for
release, publication or distribution, directly or indirectly, to
persons in the United States, Australia, Canada, Republic or
Ireland, Republic of South Africa or Japan or any other
jurisdiction in which such publication or distribution is unlawful
and should not be distributed, forwarded to or transmitted in or
into any jurisdiction where to do so might constitute a violation
of local securities laws or regulations. The New Ordinary Shares to
be issued in relation to the Placing have not been and will not be
registered under the United States Securities Act of 1933, as
amended (the "Securities Act"), or under the laws of any state of
the United States, and may not be offered, sold or transferred in
the United States except pursuant to an exemption from, or in a
transaction not subject to, the requirements of the Securities Act.
The New Ordinary Shares to be issued in relation to the Placing may
not be offered, sold or transferred, directly or indirectly, in or
into Australia, Canada, Republic or Ireland, Republic of South
Africa or Japan, or any province or territory thereof, or any other
jurisdiction in which it would be unlawful to do so. There will be
no public offer of New Ordinary Shares to be issued in relation to
the Placing in the United Kingdom or elsewhere.
Words and expressions defined in the Circular relating to the
Company dated 16 November 2011 have the same meanings when used in
this announcement unless the context requires otherwise.
The following information has been extracted without material
adjustment from the Circular. Unless the context otherwise
requires, defined terms used in this announcement shall have the
meanings ascribed to them in the Circular.
Background to and reasons for the Placing
The last twelve month period has been one of significant
transformation for the Group, particularly in terms of the Group's
management team and the refinement of the Group's strategy into one
focused on wealth management. Despite the current economic
uncertainty, wealth management remains a highly attractive market
in the UK and the Directors believe the Group is well-positioned to
benefit from the continuing and expected future growth of the
market. The market remains fragmented and, with the advent of the
FSA's Retail Distribution Review, which is scheduled to come into
force on 1 January 2013, provides opportunities for highly focused
operators in the sector to succeed.
Consequently, between December 2010 and April 2011, the Group
completed a series of non-core disposals and initiatives enabling
the Group to concentrate fully on promoting its expertise in the
mass affluent and high net worth wealth management arena.
As part of these initiatives, the Group has identified selected
areas of investment and reorganisation within the Group with the
intention of strengthening the Group's wealth management
proposition going forward and accelerating the Group's return to
profitability. Accordingly, the Directors are seeking to raise
approximately GBP8.5 million (before expenses) from both new and
existing investors, through the Placing.
Use of proceeds
The Company is proposing to raise approximately GBP8.5 million
of additional equity (before expenses) by means of the Placing, in
order to:
-- Undertake significant cost reductions. The Directors have
identified a number of cost reduction initiatives including the
acceleration of a redundancy programme with the aim of bringing the
Group's operating margins more into line with its peers. The
Directors believe that, on a pro forma basis and excluding any
impact from timing of implementation, annual cost savings of GBP5.2
million can be achieved by the Group through the implementation of
these cost reduction initiatives, with the majority of these
savings to be implemented over the next 12 months.
-- Strengthen its balance sheet and regulatory capital position.
The Directors consider this to be prudent, particularly given the
current volatile market conditions caused by the macro-economic
uncertainty in Europe and the wider global context. The Group's
regulatory consolidation waiver expires in 2014. The additional
regulatory capital should therefore ensure that the Group can
comfortably satisfy its regulatory capital requirements on expiry
of the Group consolidation waiver.
-- Develop a "best of breed" investment management proposition.
The Group aspires to be one of the leading providers of wealth
management services in the UK and aims to provide a holistic
service encompassing financial planning and investment management.
The Directors believe that strengthening the investment management
proposition is key to achieving the Group's medium to longer term
growth plans.
-- Establish a common operating platform which is scaleable. The
Directors believe that delivery of a common operating platform
throughout the Group should result in significant cost savings and
enhance risk controls across the Group. It will also provide a
stronger platform from which to grow the business in future
organically or through acquisition. This will be facilitated by the
integration of Ashcourt Rowan Asset Management and Savoy to create
a coherent and segmented offering with one clear pricing model,
both for existing and new business. If that pricing model is
applied across the Group's existing book of business, the Directors
believe that this should result in a significant increment to
revenues over the medium term.
-- Formalise arrangements in relation to certain assets managed
under its Savoy brand. The Directors are of the view that it would
be appropriate to formalise arrangements in relation to certain
assets managed on behalf of clients of Savoy and thereby increase
the prospect of these assets remaining under management by the
Group in the longer term. This will require modification to
existing contractual arrangements for certain key employees.
-- The Directors believe the above initiatives will unlock and
deliver efficiencies to the business and will establish a firm
platform for growth for the Company going forward. Once
implemented, the Directors expect that these initiatives should
generate a recurring annual spend of approximately GBP1.7
million.
Current trading and prospects
On 16 November 2011, the Company announced its interim results
for the six month period ended 30 September 2011.
These showed Group revenues were up 17.1 per cent. to GBP18.38
million when compared to the same period last year (six months to
30 September 2010: GBP15.69 million). A large part of this uplift
in revenue is as a result of the acquisition of the Co-Op IFA
business in the second half of last year. Dealing commissions fell
in the second quarter of this year compared to the same period last
year as the current volatile markets has left many clients
reluctant to deal. The Group made a loss after tax for the period
of GBP1.62 million compared to a loss for the same period last year
of GBP0.03 million.
Total funds under management or influence as at 30 September
2011 were GBP3.93 billion compared to GBP4.46 billion at 31 March
2011. The portion of these funds under discretionary or managed
advisory mandates fell 12.0 per cent. to GBP1.46 billion from
GBP1.66 billion at the year end with equity markets (FTSE 100)
falling 13.2 per cent. over the same period. Approximately 50 per
cent. of this fall is as a result of a number of Savoy clients
being reclassified as non-managed advisory or execution only. The
rest of the fall in total reported funds under management or
influence is due to a detailed review of the assets under influence
for the financial planning business and a re-evaluation of the
figure deemed to be under influence. This has seen the figures at
30 September 2011 being restated from GBP2.26 billion to GBP1.94
billion.
Historically the Group has generally seen an uplift in financial
performance in the second half of its financial year, excluding
exceptional expenditure, as end of year tax planning increases
dealing activity. The economic outlook and market conditions remain
challenging and could continue to affect the Group's financial
performance in the second half of the current financial year.
However, the Directors believe the strategic realignment of the
business will, over the next twelve months, result in the Group
moving to run-rate profitability for the first time in a number of
years. However, as part of the strategic realignment there will be
some exceptional items that will affect actual booked profitability
over this period.
A copy of the Company's interim financial report for the period
ended 30 September 2011 is available on the Company's website
(www.ashcourtrowan.com).
Details of the Placing
The Company is proposing to issue 8,500,000 Placing Shares at a
price of 100 pence per Placing Share pursuant to the Placing,
raising approximately GBP8.06 million (net of expenses and
excluding VAT). The Placing Price represents a discount, calculated
on a pre-Share Consolidation basis, of 0.2 pence (16.7 per cent.)
to the closing middle market price of an Ordinary Share on 15
November 2011, the latest practicable date prior to the date of
this announcement.
The Placing has been undertaken pursuant to the terms and
conditions of the Placing Agreement and is not being underwritten.
Under the terms of the Placing Agreement Canaccord Genuity, as
agent for the Company, has agreed to use its reasonable endeavours
to procure subscribers for the Placing Shares. Canaccord Genuity is
also the nominated adviser in connection with the Placing and
application for Admission.
The Placing Agreement is conditional, inter alia, on:
(i) the passing of the Resolutions (without material amendment) at the General Meeting;
(ii) the Company not having breached any of its obligations under the Placing Agreement; and
(iii) Admission becoming effective by not later than 8.00 a.m.
on 5 December 2011 (or such later time and/or date as the Company
and Canaccord Genuity may agree, being not later than 8.00 a.m. on
23 December 2011).
The Placing Agreement contains warranties given by the Company
in favour of Canaccord Genuity as to, amongst other things, certain
matters relating to the Company and its business. In addition, the
Company has given certain undertakings to Canaccord Genuity
relating to, amongst other things, the despatch of public
communications concerning the Company following Admission. The
Placing Agreement also contains indemnities given by the Company in
favour of Canaccord Genuity in relation to certain liabilities
Canaccord Genuity may incur in respect of the Placing and/or
Admission.
Canaccord Genuity has the right to terminate the Placing
Agreement prior to Admission in certain circumstances,
including:
(i) in the event that the Company has failed to comply in any
material respect with any of its obligations under the Placing
Agreement;
(ii) in the event that Canaccord Genuity becomes aware that any
of the warranties from the Company in the Placing Agreement is not,
or has ceased to be, true and accurate in any material respect;
and
(iii) in the event of certain events of force majeure, including
any adverse change in national or international financial,
economic, market or political conditions which in the opinion of
Canaccord Genuity (arrived at in good faith and, as far as
practicable, in consultation with the Company) would be materially
adverse to the Placing or would render proceeding with the Placing
impracticable or inadvisable.
In consideration for the services to be provided to the Company
by Canaccord Genuity in connection with Admission and the Placing,
the Company has agreed to pay Canaccord Genuity certain fees and
commissions and certain other costs and expenses incidental to
Admission and/or the Placing.
The expenses of and incidental to the Placing, including the
fees and commissions payable to Canaccord Genuity, are estimated to
be approximately GBP441,000 (excluding VAT), and will be payable by
the Company.
Application will be made to the London Stock Exchange for the
Placing Shares to be admitted to trading on AIM. Subject to,
amongst other things, the Resolutions being duly passed at the
General Meeting, it is expected that Admission will become
effective and dealings in the Placing Shares on AIM will commence
at 8.00 a.m. on 5 December 2011, being the Business Day immediately
following the General Meeting and the Share Consolidation.
If Admission does not take place on or before 8.00 a.m. on 5
December 2011 (or such later time and/or date as the Company and
Canaccord Genuity may agree, being not later than 8.00 a.m. on 23
December 2011), the Placing will not proceed.
The Placing Shares will rank pari passu in all respects with the
existing issued Ordinary Shares, including the right to receive all
dividends and other distributions declared, paid or made after
Admission.
Directors and employees
It is expected that certain Directors and employees of the Group
will be subscribing for Placing Shares in the Placing.
The subscription for Placing Shares being subscribed for by
Directors is set out in the table below:
Number of Number of Total Number Total Number Percentage
Ordinary Ordinary of Placing of New Ordinary of total
Shares held Shares held Shares being Shares held issued share
prior to following subscribed following capital
the Placing Share Consolidation for the Placing held following
Placing
Director (%)(2)
Kenneth
West - - 42,000 42,000 0.002
Jonathan
Polin - - 200,000 200,000 0.011
Neil Hale 2,288,131(1) 22,881 12,000 34,881 0.002
Jeremy Rance - - 15,000 15,000 0.001
Ranil Perera - - 5,000 5,000 0.000
(1) Includes shares held in Staff Share Incentive Plan.
(2) Based on approximate issued share capital following the
Share Consolidation and Placing.
Related party transaction
As at 15 November 2011 (being the latest practicable date prior
to this announcement), the Esfandi Related Parties held 29.36 per
cent. of the existing issued Ordinary Shares. 1,082,919 Placing
Shares will be issued to the La Galera Corporation and 1,413,342
Placing Shares will be issued to the Jodi One Trust pursuant to the
Placing and, because the Esfandi Related Parties' holding is in
excess of 10 per cent. of the existing issued Ordinary Shares, each
of the Esfandi Related Parties are considered to be related parties
under the AIM Rules and participation of the La Galera Corporation
and the Jodi One Trust in the Placing will constitute related party
transactions under Rule 13 of the AIM Rules. The aggregate interest
of the Esfandi Related Parties in the issued share capital of the
Company following the Placing will remain at 29.36 per cent.
In addition, as at 15 November 2011 (being the latest
practicable date prior to this announcement), ACP Octagon Limited
held 20.04 per cent. of the existing issued Ordinary Shares.
450,000 Placing Shares will be issued to ACP Octagon Limited
pursuant to the Placing and because ACP Octagon Limited's holding
is in excess of 10 per cent. of the existing issued Ordinary
Shares, ACP Octagon Limited is considered to be a related party
under the AIM Rules and ACP Octagon Limited's participation in the
Placing will constitute a related party transaction under Rule 13
of the AIM Rules. ACP Octagon Limited's aggregate interest in the
issued share capital of the Company following the Placing will be
15.38 per cent.
The Independent Directors, having consulted with the Company's
nominated adviser, Canaccord Genuity, believe that these related
party transactions are fair and reasonable as far as the
Shareholders are concerned. In providing its advice to the Board,
Canaccord Genuity has taken into account the Independent Directors'
commercial assessment of these related party transactions.
Proposed Share Consolidation
The Company currently has 1,836,479,749 Ordinary Shares of
GBP0.002 each in issue. It has become clear that there is a need to
undertake the Share Consolidation to make the number of shares in
the capital of the Company that are in issue more manageable.
Accordingly, it is proposed that the Share Consolidation will
consist of the following steps:
(i) every 100 existing Ordinary Shares (or such number as will
result in a whole number of New Ordinary Shares of GBP0.20 each,
the balance of the existing Ordinary Shares then held by each
Shareholder being dealt with as provided in (ii) below) held by a
Shareholder will be consolidated into one New Ordinary Share;
and
(ii) fractional entitlements arising out of the Share
Consolidation under paragraph (i) above (including those arising by
reason of a Shareholder holding less than 100 Ordinary Shares or a
number not divisible by 100) shall be aggregated into New Ordinary
Shares and the whole number of New Ordinary Shares so arising shall
be sold to such persons as the Directors shall determine. The net
proceeds from the sale of such New Ordinary Shares shall be
distributed to the Shareholders entitled to them, and cheques are
expected to be dispatched to Shareholders by 16 December 2011.
Amounts less than GBP2.00 will not be distributed to Shareholders
but will instead be aggregated and held for the benefit of the
Company.
The Directors are seeking Shareholder approval for the Share
Consolidation by ordinary resolution pursuant to Resolution 1 at
the General Meeting.
If approved, the Share Consolidation will be effective at 5.30
p.m. on the day of the General Meeting. Certificates for the New
Ordinary Shares will be despatched by 16 December 2011 to those
Shareholders who hold their Ordinary Shares in certificated form.
Any certificates in respect of existing Ordinary Shares will no
longer be valid from 5.30 p.m. on the day of the General Meeting
and should be destroyed upon receipt of certificates in respect of
the New Ordinary Shares. Pending despatch of the definitive
certificates in respect of New Ordinary Shares, transfers of New
Ordinary Shares will be certified against the register. Definitive
share certificates for New Ordinary Shares will not be despatched
to those Shareholders who hold their Ordinary Shares in
uncertificated form. Instead, the New Ordinary Shares will be
credited to such Shareholders in uncertificated form through CREST.
The ISIN for the New Ordinary Shares will be GB00B6540P35, the new
SEDOL number will be B6540P3 and the ticker, ARP, will remain
unchanged.
Option holders will have their entitlements adjusted pursuant to
the terms of their options.
Proposed reduction of the Company's share premium account
The Company has undertaken a number of transactions since its
incorporation in March 2005 and has issued a significant number of
Ordinary Shares at a premium to nominal value. This has resulted in
the Company having a large share premium account. The balance sheet
of the Company for the six months ended 30 September 2011 shows
that the amount of the Company's share premium account was
GBP72,522,000 and that the Company had accumulated losses of
GBP36,882,000. Following Admission, the share premium account will
increase by a further sum of approximately GBP6,800,000 as a result
of the issue of the Placing Shares.
The Directors consider that the size of the Company's
accumulated losses is to the detriment of the Company and its
Shareholders as the Company will be unable to pay dividends until
it has distributable reserves. The Directors consider that it would
be advantageous to reduce the Company's share premium account by
the amount of GBP50 million.
The proposed reduction of share premium account will not involve
any distribution or repayment to Shareholders. The principal effect
will be to place the Company in a position where (subject to any
undertakings that the Company may be required to give to the Court
- as detailed below) it can lawfully purchase its own shares and/or
pay dividends out of distributable profits sooner than it would
otherwise be able to do so.
The proposed reduction of the share premium account requires the
approval of Shareholders by a special resolution and the approval
of the Court. Accordingly, Resolution 5 is to be proposed at the
General Meeting is to approve a reduction of the Company's share
premium account by GBP50 million. If Resolution 5 is approved by
Shareholders in the General Meeting it is expected that an
application will be made in due course by the Company for a court
order confirming the proposed Reduction. The reduction will be
effective when the order of the court confirming the Reduction has
been registered at Companies House (together with a Statement of
Capital showing the Company's capital as altered by the Reduction)
(the "Effective Date"). An announcement will be made by the Company
upon the court order being made. It is important to note that if
Resolution 5 is passed at the General Meeting the Company is not
obliged to proceed with the Reduction and it will not do so if it
is not considered to be in the best interests of the Company.
Notwithstanding the approval of the proposal, the Directors will
determine the question of future distributions to Shareholders in
accordance with the best interests of the Company at the relevant
time and the approval of the proposed Reduction by the Court shall
not oblige the Directors to make such distributions. The Court, in
considering the proposed Reduction, is likely to require the
Company to take steps to protect the position of its creditors and
the Company is likely to be required to give an undertaking to the
Court for this purpose. The Company may, in particular, undertake
to use the reserve arising in its books of account as a result of
the Reduction as a special reserve and not make distributions using
that reserve until all the Company's creditors at the Effective
Date have been paid off or have consented.
The proposed Reduction will not change the number of Ordinary
Shares or New Ordinary Shares in issue or the rights attaching to
those shares. The Company's shares will continue to be traded on
AIM. Additionally, the Reduction will not affect the future trading
prospects of the Company and its net assets will not be reduced as
a consequence of the Reduction.
Removal of authorisation share capital
Following the implementation of the Act, the legal requirement
for a company to have an authorised share capital has been removed.
Accordingly the Directors propose to remove the concept of
authorised share capital from the Articles. Notwithstanding such
removal of the Company's authorised share capital, the Company
would still require authority from Shareholders to issue shares
pursuant to section 551 of the Act and to disapply the pre-emption
provisions of section 561(1) of the Act.
General Meeting
As noted above, the Directors are seeking authorities to allot
New Ordinary Shares to approve the Placing and the other Proposals.
Notice of the General Meeting is set out in the Circular. The
General Meeting will be held at 44 Southampton Buildings, London
WC2A 1AP on 2 December 2011 at 10.00 a.m.
An explanation of the Resolutions to be proposed at the General
Meeting is set out below:
Share Consolidation (Resolution 1)
The Directors need the authority of Shareholders to implement
the Share Consolidation. The passing of Resolution 1 will require
not less than 50 per cent. of the votes cast voting in favour.
Subject to the requisite Shareholder approval, the Share
Consolidation is expected to be effective from 5.30 p.m. on the day
of the General Meeting.
Authority to allot shares (Resolution 2)
The Directors require the authority of Shareholders in order to
allot the Placing Shares and Resolution 2 provides such authority
by granting the Directors authority to allot shares in the capital
of the Company for the purpose of the Placing, up to a maximum
nominal amount of GBP1,700,000 (representing, as at 15 November
2011 (being the latest practicable date prior to this
announcement), 31.6 per cent. of the Company's issued share
capital), such authority, if granted, lasting until the date
falling 15 months after the General Meeting or, if earlier, until
the next Annual General Meeting of the Company.
If, however, the Company makes an offer or enters into an
agreement requiring the issue of New Ordinary Shares prior to these
dates, the allotment will be valid even if the allotment occurs
after the expiry of this authority.
The passing of Resolution 2 will require not less than 50 per
cent. of the votes cast voting in favour. This authority, if
granted, will be in addition to any existing authorities to allot
New Ordinary Shares granted to the Directors prior to this
announcement which will continue in full force and effect whether
or not the Placing is effected.
Cancellation of Authorised Share Capital (Resolution 3)
The Directors propose to remove the concept of authorised share
capital from the Articles. The passing of Resolution 3 will require
not less than 75 per cent. of the votes cast voting in favour.
Disapplication of pre-emption rights (Resolution 4)
Section 561 of the Act requires that, on an allotment of "equity
securities" for cash, such equity securities must first be offered
to existing Shareholders in proportion to the number of New
Ordinary Shares they each hold at that time. This is known as a
shareholder's pre-emption right. The Placing Shares are "equity
securities" for the purposes of section 561 of the Act.
Accordingly, the Placing Shares cannot be allotted for cash on a
non pre-emptive basis unless Shareholders have first waived their
pre-emption rights and Resolution 4 requests Shareholders to do so
for the purposes of the Placing. If the authority is granted, the
Directors will be able to allot New Ordinary Shares for cash on a
non pre-emptive basis, to the extent authorised. The authority to
allot New Ordinary Shares for cash on a non pre-emptive basis in
respect of the Placing will last until the date falling 15 months
after the General Meeting or, if earlier, until the next Annual
General Meeting of the Company. The passing of Resolution 4 will
require not less than 75 per cent. of the votes cast voting in
favour.
Reduction of share capital (Resolution 5)
The Directors need the approval of Shareholders to proceed with
the proposed reduction of the Company's share premium account. The
passing of Resolution 5 will require not less than 75 per cent. of
the votes cast voting in favour.
Letters of intent
The Company has received non-binding letters of intent from
certain Shareholders to vote in favour of the Resolutions in
respect of an aggregate of 1,084,394,522 Ordinary Shares
representing 59.0 per cent. of the Company's issued share
capital.
Issued share capital
If the Share Consolidation and Placing complete, the Company's
approximate issued share capital will be GBP5,372,946.60 divided
into 26,864,733 New Ordinary Shares of GBP0.20 each.
General
As a result of the Company's recent management changes and in
view of the Proposals, the Directors believe the Company's current
senior management equity incentive plans need restructuring.
Accordingly, in the first quarter of 2012, the Company intends to
seek Shareholder approval for new equity incentive arrangements. It
should be noted that any new equity incentive arrangements proposed
will be subject to no more than 20 per cent. overall dilution of
the Company's issued share capital (at that time) from all Group
management and staff equity incentive plans.
Recommendation
The Directors believe the Placing and the other Proposals, as
set out in this announcement, to be in the best interests of the
Company and the Shareholders taken as a whole. Accordingly, the
Directors unanimously recommend Shareholders to vote in favour of
the Resolutions to be proposed at the General Meeting.
This information is provided by RNS
The company news service from the London Stock Exchange
END
MSCGGGWUGUPGGWQ
Ashcourt (LSE:ARP)
Historical Stock Chart
From Jun 2024 to Jul 2024
Ashcourt (LSE:ARP)
Historical Stock Chart
From Jul 2023 to Jul 2024
