Kin Group PLC Statement re. Suspension (3119L)
18 July 2017 - 4:30PM
UK Regulatory
TIDMKIN
RNS Number : 3119L
Kin Group PLC
18 July 2017
Kin Group Plc / Epic: KIN / Index: AIM
RNS ANNOUNCEMENT: The information communicated in this
announcement contains inside information for the purposes of
Article 7 of Regulation 596/2014.
Embargoed 07.30a.m., 18 July 2017
KIN GROUP PLC
('KIN' OR 'THE COMPANY' OR 'THE GROUP')
Statement re suspension
Kin Group Plc (AIM: KIN), the AIM quoted digital wellness
provider for corporate organisations, trading as Kin Wellness,
hereby announces that, following discussions with Belastock Capital
L.P. ("Belastock"), Belastock has informed Kin that, due to the
continued recent falls in the Company's share price, Belastock will
not proceed with the three further tranches of the Convertible Loan
Note, initially announced on 15 May 2017.
On 15 May 2017, the Company announced that it had agreed to
issue convertible unsecured loan notes with a term of three years
("Notes"), to raise up to GBP1.125 million (before expenses) in
four tranches, to Belastock, an overseas based institutional
investor to fund its general working capital requirements.
The issue of the Notes was subject to the terms and conditions
summarised in the announcement dated 15 May 2017. The first tranche
of Notes, with a nominal amount of GBP350,000 and a subscription
price of GBP315,000 ("Tranche 1 Notes"), were issued on 15 May 2017
with the remaining three tranches due to be issued at 60 day
intervals thereafter. The second tranche was due to be issued in
mid-July.
One of the conditions attaching to the issue of subsequent
Notes, which could be waived by Belastock, is that the closing bid
price of the Company's ordinary shares (as reported by Bloomberg)
would not fall below GBP0.001 (0.1 pence) for any five (5)
consecutive trading days on or prior to the relevant issue date.
The Company noted that this condition was not met at the close of
business on 12 June 2017.
On 13 June 2017, the Company announced that, "notwithstanding
this breach of the condition the Directors are pleased to report
that Belastock has confirmed its ongoing support for the Company
and that it is the current intention of Belastock to subscribe for
the remaining tranches of the Notes as previously outlined. The
second tranche of the Notes, which should raise approximately
GBP255,000 (net of expenses), are due to be issued in
mid-July."
This will not now take place and Belastock has indicated that
due to the fall in Kin's share price, particularly since 13 June
2017, it has decided that it will not proceed with the remaining
tranches of the Notes, which would have raised GBP765,000 (net) for
Kin over the next four months.
As stakeholders are aware, Kin has been in an extended period of
turnaround since December 2015 when it changed to its B2B strategy.
In its final results for the year to 31 December 2016 which were
published in early April 2017, the Group reported that it was
experiencing healthy interest in its products from a number of
large corporates and this continues to be the case. However, it
also stated that that the road to conversion of many of these
potential customers from first contact to sales is long. As a
result the Group's needs for further development capital,
particularly to expand its bandwidth to deal with the many
potential opportunities which it is currently experiencing,
continue as the sales process continues to develop. The Notes were
a key part of the Company's plans for short term development
capital and the withdrawal of this support has meant the Company
now has a significant, unexpected shortfall in its available
working capital.
The Board is seeking to raise additional funding to fill this
gap. The Company has been in dialogue with NW1, its largest
shareholder and senior secured creditor, and other parties. There
is no guarantee that this fundraising will be completed
successfully and so the Company has requested suspension of trading
in its ordinary shares on AIM pending clarification of its
financial position.
Therefore, at the request of the Company, Kin's ordinary shares
have been suspended from trading on AIM with effect from 07.30 a.m.
this morning.
The Company's ordinary shares will remain suspended from trading
on AIM whilst the Board continues its discussions.
The Company will issue further announcements as appropriate.
-Ends-
For further information visit www.kinwellness.com
Contact:
Anna Gudmundson
/ Donald Stewart Kin Group Plc 020 7449 4949
SPARK Advisory
Mark Brady / Neil Partners Limited
Baldwin (Nominated Adviser) 020 3368 3551
Hybridan LLP,
Claire Louise Noyce Broker 020 3764 2341
This information is provided by RNS
The company news service from the London Stock Exchange
END
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