TIDMGUS
RNS Number : 3054P
Gusbourne PLC
18 October 2021
18 October 2021
THIS ANNOUNCEMENT AND THE INFORMATION CONTAINED HEREIN IS
RESTRICTED AND IS NOT FOR PUBLICATION, DISTRIBUTION OR RELEASE
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UNITED STATES, CANADA, THE REPUBLIC OF SOUTH AFRICA, AUSTRALIA OR
JAPAN OR ANY OTHER JURISDICTION IN WHICH SUCH PUBLICATION,
DISTRIBUTION OR RELEASE WOULD BE UNLAWFUL. THIS ANNOUNCEMENT SHOULD
BE READ IN ITS ENTIRETY.
THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION FOR THE PURPOSES
OF ARTICLE 7 OF EU REGULATION 596/2014 AS IT FORMS PART OF UK
DOMESTIC LAW BY VIRTUE OF THE EUROPEAN UNION (WITHDRAWAL) ACT 2018
("MAR"). UPON THE PUBLICATION OF THIS ANNOUNCEMENT VIA REGULATORY
INFORMATION SERVICE, THIS INSIDE INFORMATION IS NOW CONSIDERED TO
BE IN THE PUBLIC DOMAIN.
Gusbourne Plc
("Gusbourne" or the "Company")
Funding Update
Following the recent strong interim trading results, Gusbourne
Plc, the English sparkling wine producer, is pleased to announce
the following capital structure and funding plans to support the
further development and growth of the Gusbourne business as
follows:
-- Exercise of warrants:
The Company's largest shareholder, Belize Finance Limited
("BFL"), a related party of Lord Ashcroft who is classified as a
substantial shareholder under the AIM Rules, has irrevocably agreed
to exercise all its outstanding warrants (the "BFL Warrants") to
subscribe for ordinary shares of 1 pence each in the Company
("Shares"). Pursuant to the exercise of the BFL Warrants, BFL
subscribes conditional only the release of this announcement for
1,311,517 Shares at 75p per Share (the "Issue Price") which will
provide cash proceeds to Gusbourne of GBP983,638.
Following this exercise, other warrant holders will hold
outstanding warrants (the "Warrants") to subscribe for a further
707,500 Shares at the Issue Price. Any Warrants remaining
unexercised will expire on 29 October 2021.
-- Conversion of short term debt into Shares
The majority holder of the Company's deep discount bonds issued
in 2016 and 2020 (together the "DDBs") and the holder of the
short-term loan have agreed to extend the repayment date of these
debts to 29 October 2021. The total amount of the DDBs and the
short-term loan as at 29 October 2021 amounts to GBP6,192,252.
BFL has irrevocably agreed to convert its interest in the DDBs
into Shares at the Issue Price on 29 October 2021 (the "BFL
Conversion"). In total BFL will convert its DDBs into 2,838,765
Shares at the Issue Price in respect of money owed in respect of
the 2020 DDB amounting to GBP2,129,074 and 2,306,314 Shares at the
Issue Price in respect of money owed in respect of the 2016 DDB
amounting to GBP1,729,735.
Franove Holdings Limited ("Franove"), a related party of Paul
Bentham, a director of the Company, the sole holder of the
short-term loan, has irrevocably agreed to convert its short-term
loan amounting to GBP610,445 into 813,926 Shares at the Issue Price
on 29 October 2021 (the "Franove Conversion").
A letter will be sent today to all other holders of DDBs
inviting them to convert amounts owed to them by the Company via
the DDBs into Shares. The conversion price is 75p per share, up to
the total value of the proceeds of DDBs. The total amount of the
DDBs held other than by BFL as at 29 October 2021 will amount to
GBP1,722,998.
The extension for the repayment date of the DDBs and the short
term loan and the two subscriptions described above by BFL and
Franove constitute related party transactions. Neither BFL nor
Franove will have any interest in the DDBs following the above
conversion.
The Company will not receive any cash proceeds from the
conversion of the DDB's and the short-term loan into Shares.
The balance of the short-term debt on 29 October 2021 not held
by BFL and Franove is held by the remaining holders of the 2016
DDBs and will amount to GBP1,722,998, before offsetting any further
conversion into Shares under the terms noted above.
-- Placing and Subscription
The Company intends to undertake a placing of Shares to raise
approximately GBP2,125,000 (the "Placing") . The Placing is
intended to be undertaken by way of an accelerated bookbuild (the
"Bookbuild") to new investors at an issue price of 75p per share
.
In addition to the Placing, the Company has entered into two
subscription letters: one with Jim Ormonde (through his nominee
Company), a related party, who is a Director of the Company and its
Chairman, and a second with an existing investor who is not a
related party, under which they will subscribe GBP225,000 and
GBP150,000 for Shares respectively at 75p per share (the
"Subscriptions" and together the "Subscription"). A separate
announcement will be made shortly regarding the Placing and
Subscription.
-- Open Offer
The Company intends, shortly after 29 October 2021, to make an
open offer ("Open Offer") to raise approximately GBP2,000,000 to be
made to all shareholders of the Company ("Shareholders"), excluding
BFL, at 75p per share.
It is intended that the Open Offer will be made to all
Shareholders, excluding BFL, in November 2021, after additional
subscriptions (if any) for Shares from the exercise of outstanding
Warrants, conversions of the DDBs and the short-term loan into
Shares, and the completion of the Placing and Subscription. The
Open Offer will include an opportunity to apply for additional
Shares in excess of each Shareholder's entitlements.
The Company has entered into an agreement with BFL whereby BFL
will commit to underwrite the Open Offer in full in the event that
Shares are not taken up by Shareholders as part of the Open Offer
(the "BFL Underwrite"). BFL will receive a fee of GBP100,000 for
agreeing to underwrite the Open Offer. Further details of the Open
Offer will be provided in a separate announcement when it is
made.
Benefit of these transactions for the Company
Following the completion of the Placing and Subscription, the
exercise of the BFL Warrants by BFL, the BFL conversion and the
Franove Conversion, any exercise of the Warrants, the repayment or
conversion of the remaining DDBs, and the Open Offer (together "the
Transactions"), the Directors expect that all remaining short-term
debt on the Company's balance sheet will be eliminated, thereby
strengthening the Company's balance sheet. Furthermore it is
intended that the Placing will broaden the shareholder base of the
Company.
The funding raised is expected to amount to approximately GBP3.8
million before transaction expenses and before any exercise of the
Warrants and conversion of 2016 DDBs, over and above those
irrevocably committed above. This funding will be used to support
the ongoing business growth across all distribution channels
(Direct to Consumer, UK Trade and International) and further
development of the Company, including:
-- Increasing visitor capacity at the Company's cellar door operations ("The NEST") in Appledore
-- Increasing sales and marketing expenditure to promote further sales growth
-- Investing in further digital promotion and sales optimisation across all channels
-- Supporting future growth potential by increasing production efficiency and capacity
Bonus issue of warrants to all shareholders :
The Company will make a bonus issue of transferrable one-year
warrants to subscribe for approximately 4 million (c.GBP3million)
ordinary shares at 75p per share to all Shareholders on the
register following completion of the Open Offer, pro rata to their
shareholdings.
Related Party Transactions
The extension of the repayment date of the DBBs held by BFL, the
BFL Conversion and the BFL Underwrite each constitute a related
party transaction, as BFL is a related party of Lord Ashcroft who
is classified as a substantial shareholder under the AIM Rules.
Further, the extension of the repayment date of the short-term loan
(set out above) provided by Franove and the Franove Conversion are
also considered a related party transaction as Franove is a related
party of Paul Bentham, a director of the Company. The independent
directors of the Company (being all the directors, excluding Paul
Bentham), having consulted with Canaccord Genuity Limited in its
capacity as the Company's nominated adviser for the purposes of the
AIM Rules, consider the terms of the related party transactions,
set out above, to be fair and reasonable insofar as the Company's
Shareholders are concerned.
Charlie Holland, Chief Winemaker and Chief Executive Officer,
commented:
"We are delighted to announce our funding plans, which will
include a broadening of our shareholder base and the conversion of
most of our short-term debt into equity. This will provide
significant support for the Company's ambitious plans to grow sales
of our expanding range of luxury wines.
We also look forward to welcoming new investors to join us on
this exciting journey, as we remain focused on building a
lighthouse brand at the forefront of English winemaking. We are
grateful to all our Shareholders and other stakeholders in the
business for their continued and valued support".
Enquiries:
Gusbourne Plc
Charlie Holland +44 (0)12 3375 8666
Canaccord Genuity Limited (Nomad and Joint Broker)
Bobbie Hilliam +44 (0)20 7523 8000
Georgina McCooke
Panmure Gordon (UK) Limited (Joint Broker)
Oliver Cardigan + 44 (0)20 7886 2500
Hugh Rich
Ailsa Macmaster
This Announcement contains inside information for the purposes
of Article 7 of EU Regulation 596/2014, which forms part of UK law
by virtue of the European Union (Withdrawal) Act 2018 ("MAR"). In
addition, market soundings (as defined in MAR) were taken in
connection with the matters referred to above as a result of which
certain persons became aware of inside information (as defined in
MAR), as permitted by MAR. This inside information is set out in
this Announcement. Therefore, those persons that received such
inside information in a market sounding are no longer in possession
of such inside information relating to the Company and its
securities.
Note: This and other press releases are available at the
Company's website: www.gusbourneplc.com
Note to Editors
Gusbourne produces and distributes a range of high quality and
award winning vintage English sparkling wines from grapes grown in
its own vineyards in Kent and West Sussex.
The Gusbourne business was founded by Andrew Weeber in 2004 with
the first vineyard plantings at Appledore in Kent. The first wines
were released in 2010 to critical acclaim. Following additional
vineyard plantings in 2013 and 2015 in both Kent and West Sussex,
Gusbourne now has 231 acres of mature vineyards. The NEST visitor
centre was opened next to the winery in Appledore in 2017,
providing tours, tastings and a direct outlet for our wines.
Right from the beginning, Gusbourne's intention has always been
to produce the finest English sparkling wines. Starting with
carefully chosen sites, we use best practice in establishing and
maintaining the vineyards and conduct green harvests to ensure we
achieve the highest quality grapes for each vintage. A quest for
excellence is at the heart of everything we do. We blind taste
hundreds of samples before finalising our blends and even after the
wines are bottled, they spend extended time on their lees to add
depth and flavour. Once disgorged, extra cork ageing further
enhances complexity. Our winemaking process remains traditional,
but one that is open to innovation where appropriate. It takes four
years to bring a vineyard into full production and a further four
years to transform those grapes into Gusbourne's premium sparkling
wine.
We are one of England's most awarded wine producers. Highlights
include:
-- Three times winner of the International Wine & Spirits
Challenge (IWSC) English Wine Producer of the Year, having won the
award in 2013, 2015 and 2017- a unique achievement
-- Winner of 'Winery of the Year' trophy at the WineGB competition
-- Highest rated English sparkling wine by the Wine Enthusiast in 2020
-- Trophy for best English Still Red Wine at Wine GB awards 2018-2020
-- Best in Class trophies at the Champagne & Sparkling World Championships in both 2018 and 2019
-- 'Best English Sparkling Wine' as well as overall 'IWC China
Champion Sparkling Wine 2019' at the International Wine Challenge
held in Shanghai
Gusbourne's luxury brand enjoys premium price positioning, and
its wines are distributed in some of the finest establishments both
in the UK and abroad. Our wines can be found in leading luxury
retailers, restaurants, hotels and stockists, always being aware
that where we are says a lot about who we are.
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END
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