TIDMPTCM
RNS Number : 1292R
Porta Communications PLC
07 December 2016
7 December 2016
Porta Communications Plc
("Porta", "the Group" or "the Company")
Acquisition of additional interest in Newgate Australia and
Newgate Hong Kong
Porta Communications Plc, the international communications and
marketing group, announces that it has increased its equity
ownership in Newgate Communications PTY Ltd ("Newgate Australia")
and Newgate Communications (Hong Kong) Ltd ("Newgate Hong
Kong").
Gene Golembiewski, Finance Director of Porta, said: "We have now
reached the first stage, as outlined in the shareholder agreements,
for us to increase our shareholding in Newgate Australia and
Newgate Hong Kong. Both of these start-up businesses, which were
funded by Porta, have gained traction very quickly in the initial
start-up phase and have contributed significantly to Porta's growth
and financial performance; solid proof that our overseas start-up
strategy has delivered results and is an incentive for local
management which, we believe, will benefit all shareholders."
Newgate Australia
Porta founded Newgate Australia as a 51 per cent subsidiary in
2013, with the remaining 49 per cent held by members of the Newgate
Australia management team, including Brian Tyson, Felicity Allen
and Campbell Moors, all current or former directors of Newgate
Australia (the "Australian Management Shareholders"), and a number
of other employee shareholders (together the "Australian Newgate
Shareholders"). Under the terms of the shareholders' agreement
between Porta and the Australian Newgate Shareholders (the
"Australian Shareholder Agreement"), Porta has the right to acquire
an additional 29 per cent of Newgate Australia from the Australian
Newgate Shareholders, consideration for which is to be satisfied by
the issue of new ordinary shares of 1p each in Porta ("Ordinary
Shares"). This acquisition was to be staged in two parts; with 9
per cent being acquired during 2016 and 20 per cent being acquired
during 2017.
Newgate Australia plan to launch an additional brand in
Australia to help facilitate the future development and growth of
this business in which Porta and the Australia Management team will
be major beneficiaries. In light of this strategy and in order to
align and incentivise the Newgate Australia management team to
continue to drive their strong business performance, Porta and the
Newgate Australia Shareholders have agreed to amend the Australian
Shareholder Agreement, including inter alia to:
-- reduce the interest to be acquired by Porta during 2016 from
9 per cent to 6.86 per cent of Newgate Australia, by acquiring the
entirety of Felicity Allen's (a recently ex-director of Newgate
Australia) shareholding in Newgate Australia, rather than on a pro
rata basis from each of the Australian Newgate Shareholders;
and
-- require Porta to acquire a further 4.428 per cent interest in
Newgate Australia in 2017 and each of the subsequent four years.
The subsequent acquisitions from the remaining Australian Newgate
Shareholders will be on a pro rata basis, or as otherwise agreed
between the Australian Newgate Shareholders, and notified to Porta
in accordance with the Australian Shareholder Agreement. The
consideration will be satisfied by the issue of ordinary shares in
the capital of Porta.
Calculation of the consideration payable in respect of the
acquisition described above remains unchanged from the original
Australian Shareholder Agreement; being with reference to the
profits after tax of Newgate Australia for the financial year prior
to the year in which the acquisition is to be made (for example in
reference to the profits after tax of Newgate Australia for the
year to 31 December 2016 in respect of acquisitions to be made in
2017).
Consequently, Porta has acquired 6.86 per cent of Newgate
Australia, increasing Porta's interest from 51 per cent to 57.86
per cent. The consideration for this additional interest is
GBP345,840 which is being satisfied by the issue of 8,646,000
Ordinary Shares at a price of 4p per Ordinary Share, being the
average of the middle market quotation for each of the last five
business days preceding the date of issue. The share consideration
is subject to a lock-in agreement which provides for a six-month
lock-in period and a further six-month orderly market period.
Newgate Hong Kong
Porta has also acquired a further 9 per cent of the share
capital of Newgate Hong Kong that was held by Richard Barton and
Zhang Yan, Grace (together the "Hong Kong Management
Shareholders"), increasing Porta's interest from 51 per cent to 60
per cent. The consideration for the additional interest is
GBP181,767 which is being satisfied by the issue of 4,544,175
Ordinary Shares at an issue price of 4p per Ordinary Share, being
the average of the middle market quotation for each of the last
five business days preceding the date of issue. The share
consideration is subject to a lock-in agreement which provides for
a six-month lock-in period and a further six-month orderly market
period.
Under the terms of the shareholder agreement between Porta and
the Hong Kong Management Shareholders, Porta has the right to
acquire an additional 20 per cent of the share capital of Newgate
Hong Kong from the Hong Kong Management Shareholders during 2018,
calculated with reference to the profits after tax of Newgate Hong
Kong for the year to 31 December 2017.
Related Party Transaction
The amendments made to the Australian Shareholder Agreement
constitute a related party transaction under the AIM Rules for
Companies as the Australian Management Shareholders are related
parties by virtue of being directors of a subsidiary of Porta. The
directors of the Company consider, having consulted with Grant
Thornton UK LLP, the Company's nominated adviser, that the terms of
this transaction are fair and reasonable insofar as its
shareholders are concerned.
Application for admission to trading on AIM
Application has been made to the AIM Market of the London Stock
Exchange ("AIM") for 13,190,175 new Ordinary Shares, which rank
pari passu with the Company's existing issued Ordinary Shares, to
be admitted to trading on AIM. Dealings on AIM are expected to
commence at 8:00 a.m. on or around 12 December 2016
("Admission").
Total Voting Rights
For the purposes of the Financial Conduct Authority's Disclosure
Guidance and Transparency Rules ("DTRs"), following Admission the
issued share capital of the Company will comprise 309,450,007
Ordinary Shares with voting rights attached (one vote per share).
The Company does not hold any shares in treasury. This figure of
309,450,007 may be used by the Company's shareholders as the
denominator for the calculation by which they will determine
whether they are required to notify their interest in, or a change
to their interest in the share capital of Porta under the DTRs.
-- ends --
The information contained within this announcement is considered
to be inside information prior to its release.
Enquiries
Porta Communications Plc
Gene Golembiewski, Finance Director
www.portacomms.com
+44 (0) 20 7680 6500
Grant Thornton UK LLP (Nominated Adviser)
Philip Secrett
Samantha Harrison
Daniel Bush
+44 (0) 207 383 5100
N+1 Singer (Broker)
James Maxwell
Lauren Kettle
+44 (0) 20 7496 3000
Redleaf PR (Media Enquiries)
Charlie Geller
Sam Modlin
+44 (0) 20 7382 4769
Notes to Editors:
Porta has two divisions:
-- Communications - financial, corporate and consumer public
relations, public affairs and research;
-- Marketing & Advertising - multi-capability marketing,
brand and creative communications.
The Group has offices in Abu Dhabi, Beijing, Brisbane, Bristol,
Canberra, Cardiff, Edinburgh, Hong Kong, London, Manchester,
Melbourne, Singapore and Sydney.
The brands and companies it owns are: Newgate Communications,
PPS Group, Redleaf Communications, Publicasity, 13 Communications,
Newgate Sponsorship, 2112 Communications and Summit Marketing
Services.
Porta Communications' corporate website is -
www.portacomms.com
This information is provided by RNS
The company news service from the London Stock Exchange
END
ACQLLFIDFLLRIIR
(END) Dow Jones Newswires
December 07, 2016 02:00 ET (07:00 GMT)
Porta Communications (LSE:PTCM)
Historical Stock Chart
From Apr 2024 to May 2024
Porta Communications (LSE:PTCM)
Historical Stock Chart
From May 2023 to May 2024