China Food Company PLC Amendment to Loan Notes and Update on Fuss Feed (1641Q)
02 Novembro 2012 - 5:00AM
UK Regulatory
TIDMCFC
RNS Number : 1641Q
China Food Company PLC
02 November 2012
Press Release 2 November 2012
China Food Company Plc
("China Food" or the "Company")
Amendment to Loan Notes
and Update on Fuss Feed
China Food Company plc (AIM: CFC), a leading Chinese
manufacturer of cooking and dipping sauces, announces that,
following approval by the majority of A, B & C Loan Note
holders, the terms of the A, B & C Loan Notes ("Loan Notes")
have been amended as detailed below.
The Loan Notes have been initially extended to 31 January 2013
to accommodate the delay in Korean regulatory approvals required to
consummate the disposal of the Fuss Feed subsidiary ("Disposal")
announced in July 2012.
If the Disposal has not been completed by 31 January 2013 then
the Loan Note holders have agreed to further extend the redemption
date to 3 November 2014. A redemption premium of 1% of the Loan
Note holder's original holding will be payable on redemption. The
Company and the Loan Note holders have agreed that interest will be
charged at a rate of 12.5% p.a. from 3 November 2012 to 31 January
2013; from 1 February 2013 to 30 June 2013, the rate of interest
will rise to 15% p.a.; from 1 July to 30 September 2013 to 17.5%
p.a.; from 1 October to 31 December 2013 to 20% p.a. and 25% p.a.
thereafter until redemption. The Loan Note holders retain the right
not to redeem their holding until maturity of the Loan Notes on 3
November 2014, in which case the interest rate will be fixed at the
rate prevailing on the date of the Company's proposed redemption.
In the event the Company is unable to transfer funds from the PRC
to pay interest when due, the A, B, & C Loan Note holders have
agreed that interest charged will be rolled up and compounded
semi-annually to maturity.
If the Loan Notes are not redeemed by 31 December 2012, the
price at which the Loan Notes are convertible will be re-set to the
lower of the average mid market price for the period of 20-31
December 2012 and 19p per ordinary share being the closing mid
price on the day preceding this announcement. The total amount of
Loan Notes currently in issue is GBP4.323 million.
The Company continues to examine alternatives for the remittance
of funds from the PRC to enable the redemption of the Loan Notes
and payment of semi-annual interest obligations. The Company had a
gross cash balance in the PRC of approximately GBP6 million as at
31 August 2012.
The Company will appoint an independent advisor to evaluate the
future strategic direction of China Food with a view to maximising
shareholder value. In addition, the Loan Note holders have been
granted the right to appoint a non-executive director to the
Company's board in the event the Loan Notes and accrued interest
are not repaid before 31 January 2013.
Update on Fuss Feed
The Company remains in discussion with Wisehand Planning Co. Ltd
regarding the sale of the animal feed business and will update
shareholders as soon as material progress is made.
Construction of the Company's new state of the art 300,000 tonne
feeds factory is now practically complete. The final pieces of
machinery are currently being installed and it is anticipated that
production will commence in December 2012. The new factory is an
integral part of the sale of Fuss Feed. Its completion on schedule
ensures that the risk element associated with building, completing
and commissioning a new facility has been removed. Images of the
new facility are available to view on the Company's website
(www.chinafoodcompany.com). This compares to the China Food's
existing factory with capacity of just 75,000 tonnes, which
produced an operating profit of GBP2 million for the year to 31
December 2011.
Other matters
In terms of the China Food's condiments business, the Board is
encouraged by the increased level of activity in respect of both
Hao Tai Tai and Xaka for the autumn season.
- Ends -
For further information:
China Food Company Plc Tel: +44 (0) 20 7930 8888
John McLean, Chairman Tel: +44 (0) 7768 031 454
www.chinafoodcompany.com
finnCap
Geoff Nash / Ben Thompson (Corporate Tel: +44 (0) 20 7220
Finance) 0500
Simon Starr (Broking)
Numis Securities
David Poutney (Joint Broker) Tel: +44 (0) 20 7260
1000
Media enquiries:
Abchurch Communications
Henry Harrison-Topham / Joanne Shears Tel: +44 (0) 20 7398
7702
henry.ht@abchurch-group.com www.abchurch-group.com
This information is provided by RNS
The company news service from the London Stock Exchange
END
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