TIDMTAU
RNS Number : 0428T
Tau Capital PLC
15 March 2019
THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION FOR THE PURPOSES
OF ARTICLE 7 OF THE MARKET ABUSE REGULATIONS (EU) NO. 596/2014
("MAR"). IN ADDITION, MARKET SOUNDINGS WERE TAKEN IN RESPECT OF THE
MATTERS CONTAINED IN THIS ANNOUNCEMENT, WITH THE RESULT THAT
CERTAIN PERSONS BECAME AWARE OF SUCH INSIDE INFORMATION. UPON THE
PUBLICATION OF THIS ANNOUNCEMENT, THIS INSIDE INFORMATION IS NOW
CONSIDERED TO BE IN THE PUBLIC DOMAIN AND SUCH PERSONS SHALL
THEREFORE CEASE TO BE IN POSSESSION OF INSIDE INFORMATION.
15 March 2019
Tau Capital plc
("Tau" or the "Company")
Distribution of Cash, Share Capital Re-organisation,
Conditional Placing and Company update
Highlights
-- Proposed return of substantially all of the Company's cash to shareholders;
-- Capital return of US$1,185,429 equivalent to US$0.0242 per share;
-- Conditional U$150,000 placing at US$0.001 per share.
-- Capital return and placing conditional on Shareholders'
approval at proposed General Meeting, to be held on 8 April
2019
-- Post-completion of capital return;
o proposed Board changes; and
o change of Company name to "UK Onshore PLC".
Further to the Company's announcement on 4 December 2018, Tau
announces that it has completed a review of the proposals received
from parties interested in performing a prospective reverse
takeover under AIM Rule 14 with the Company. Following this review,
and in order for the Company to be positioned to undertake a future
reverse takeover ("RTO"), the Board has decided that it is in the
best interests of the Company to allow Shareholders the ability to
receive a return of the net cash currently held by Tau. In
addition, the Company has conditionally raised gross proceeds of
US$150,000 via the Placing which will be used, inter alia, to
ensure that sufficient working capital is retained by the Company
following the return of the net cash to enable the Board to target
RTO opportunities.
1. Background
As previously announced, since completion of the sale of the
Company's indirect interest in Stopharm LLP on 18 October 2018, Tau
has been classified as an AIM Rule 15 cash shell and as such is
required to complete an RTO or be re-admitted to trading on AIM as
an investing company under the AIM Rules (which requires the
raising of at least GBP6 million) on or before 18 April 2019,
failing which trading in the Company's Ordinary Shares on AIM would
be suspended pursuant to AIM Rule 40. The admission to trading on
AIM of the Company's Ordinary Shares would be cancelled six months
after the date of such a suspension, should the reason for the
suspension not have been rectified.
Against this background, the Company has been evaluating a
number of early stage proposals from third parties who have
expressed interest in performing an RTO under AIM Rule 14 with the
Company. After a review of these proposals, the Board has concluded
that an opportunity now exists to provide the ability for all
remaining cash in the Company not required to meet current
operating costs and liabilities to be distributed to Shareholders,
alongside a proposal to potentially utilise Tau's status as an AIM
Rule 15 cash shell for an RTO. It is the Board's view that this
combined proposal offers existing Shareholders the most cost
effective and immediate means of distributing the Company's
remaining cash to Shareholders and also provides the opportunity
for existing Shareholders to retain a level of participation in the
Company's future.
2. Distribution of Cash
As at the date of this document, the Company holds US$1,185,429,
which is equivalent to US$0.0242 per existing Ordinary Share,
available for distribution after retention of funds required to
meet its ongoing solvency requirements up until the date the
Placing is completed in accordance with the Isle of Man Companies
Act 2006 ("2006 Act"). The intention is for the distribution of
this net cash to be completed and for the funds to be paid out to
Shareholders on 12 April 2019. However, Shareholders should be
aware that in the event that the Resolutions are not approved, then
a lower amount will be paid out to Shareholders, reflecting the
need for the Company to satisfy the additional costs associated
with a solvent winding down of the Company, with this process being
preceded by a cancellation of the admission to trading of the
Company's shares on AIM in accordance with AIM rule 41.
3. Share Capital Reorganisation
The Company was initially incorporated under the Isle of Man
Companies Acts 1931 to 2004 but was re-registered under the 2006
Act on 25 July 2012. The 2006 Act contains no concept of authorised
share capital (although it is common for listed companies, such as
the Company, to prescribe a fixed number of shares available for
issue in their articles of association) and a company governed by
the 2006 Act is able to issue shares with or without a par
value.
The Company's Articles currently specify that, unless otherwise
directed by a shareholder resolution, the number of Ordinary Shares
available for issue by the Company is 350,200,000. The par value
for the Ordinary Shares is currently GBP0.01 per Ordinary
Share.
To help facilitate the Placing, it is proposed that the Placing
Shares have no par value in order that the Placing Shares may be
issued and allotted at a subscription price that is lower than the
current par value of the existing Ordinary Share. In order to avoid
creating an additional class of share, it is therefore proposed
that the existing Ordinary Shares be redenominated as Ordinary
Shares with no par value.
Under the 2006 Act the Directors may by resolution, subject to
contrary provision in the Articles, alter the Company's share
capital comprising shares with par value in any way. This power is
restricted by Article 11 which provides that a conversion of share
capital into shares of a larger or smaller par value requires the
sanction of an ordinary resolution. The Articles do not
specifically expressly permit the reclassification of shares with a
par value as shares without a par value or, more generally, permit
the alteration of shares without a par value. To enable the Company
to proceed with the Placing, it will therefore be necessary to
amend the Articles to enable the existing Ordinary Shares to be
reclassified as Ordinary Shares with no par value and to make
certain other consequential amendments resulting from the
redenomination of the Ordinary Shares as shares with no par value.
To achieve this, the following resolutions will be proposed at the
EGM
(a) a special resolution to approve certain amendments to the Articles; and
(b) an ordinary resolution to authorise the redenomination of
the current Ordinary Shares each of GBP0.01 par value into Ordinary
Shares of no par value.
Accordingly, if the Resolutions are passed, Shareholders will
hold Ordinary Shares each of no par value.
4. Conditional Placing
The Company has conditionally raised gross proceeds of
US$150,000 via a placing of 150,000,000 new Ordinary Shares of no
par value (the "Placing Shares") with new investors at a price of
US$0.001 per Placing Share (the "Placing"). Peterhouse Capital
Limited is acting as broker to the Placing.
The Placing is subject to the requisite Shareholder approval
and, accordingly, the issue of the Placing Shares is conditional
on, inter alia, the passing of the Resolutions by the Shareholders
at the EGM which is to be held on 8 April 2019. Whilst Shareholders
will retain their shareholdings in the Company, following the issue
of the Placing Shares, current Shareholders will be diluted down to
collectively represent 24.62% of the enlarged issued share capital
of the Company.
Application will be made to the London Stock Exchange for the
Placing Shares and the Ordinary Shares of no par value to be
admitted to trading on AIM ("Admission"). It is expected that,
subject to passing the Resolutions, Admission will become effective
and dealings in the Placing Shares and the Ordinary Shares of no
par value will commence, at 8:00 am on 9 April 2019.
It is intended that the proceeds of the Placing will be used to
maintain and/or strengthen the Company's balance sheet, to ensure
that the solvency requirements under the 2006 Act are met and
ensure sufficient working capital is retained by the Company to
enable the Board to identify an RTO opportunity.
Upon Admission, the Company will grant a total of 1,989,846
warrants over new Ordinary Shares to Allenby Capital Limited,
pursuant to an agreement dated 9 December 2016. Each warrant will
entitle Allenby Capital Limited to subscribe for one new Ordinary
Share at an exercise price of US$0.001, being equal to the Placing
Price, at any time until the date that is three years from
Admission.
5. Prospective Board Changes and Name Change
To ensure that the Board has sufficient experience and expertise
in evaluating potential RTO opportunities, conditional on the
approval of the Resolutions at the EGM and completion of the
proposed Placing and subject to and following approval from the
Company's nominated advisor after a customary director due
diligence process, it is intended that Gerwyn Williams and Nigel
Burton will join the Board, as non-executive directors
respectively, replacing Terence Mahony and Philip Lambert.
The appointments of Gerwyn Williams and Nigel Burton are subject
to approval from the Company's nominated advisor after a customary
director due diligence process.
Gerwyn Llewellyn Williams, aged 69
Gerwyn is a qualified Electrical Engineer with many years' hands
on experience in the coal mining and unconventional gas industries
having started work as an underground mine worker spending 22 years
working for British Coal. He has founded a number of energy
businesses and is currently the largest shareholder in Infinity
Energy and the company's Chief Executive Officer. Gerwyn is also
the Chairman of UK Onshore Gas, his family owned group of companies
that hold 139,839 acres of Petroleum Exploration and Development
Licences ("PEDL") in South Wales via wholly owned subsidiary
companies Coastal Oil and Gas Limited, UK Methane Limited and Adamo
Energy (UK) Limited. Gerwyn is also the sole Director of Transgas
whose subsidiary South Western Energy Limited holds 203,590 acres
of PEDLs in North Somerset and in Dorset adjacent to Wytch Farm.
Transgas is wholly owned by the Williams family. Gerwyn is a
Chartered Engineer, a Fellow of the Institute of Materials,
Minerals and Mining, and a Fellow of the Energy Institute.
Nigel John Burton, aged 61
Nigel has over 25 years' experience in operational and financial
management, debt and equity financing, acquisition and integration
of businesses, disposals, IPOs and trade sales. Following over 14
years as an investment banker at leading City institutions
including UBS Warburg and Deutsche Bank, including as the managing
director responsible for the energy and utilities industries, Nigel
spent 15 years as chief financial officer of a number of private
and public companies, including Navig8 Product Tankers Inc,
PetroSaudi Oil Services Limited, Advanced Power AG, and Granby Oil
and Gas plc, followed by three years as Chief Executive Officer of
Nu-Oil and Gas plc. Nigel is currently non-executive chairman of
AIM-listed Remote Monitored Systems plc, and until March 2018 was a
non-executive director of AIM-listed Management Resource Solutions
plc.
Philip Scales will remain as an Isle of Man domiciled
director.
For the avoidance of doubt, it is likely that the Board changes
described above will take effect as soon as practicable following
the completion of the Placing.
Following and subject to the approval of the Resolutions, it is
the intention of the new Board to change the name of the Company to
UK Onshore Plc (subject to the prior approval of the new name by
the Isle of Man Registrar of Companies).
6. Anti-Embarrassment Clause
As previously announced the Company has put in place an
Anti-Embarrassment Clause attached to the disposal of the Company's
indirect interest in Stopharm. The Company now confirms that any
further consideration that may be received pursuant to the
Anti-Embarrassment Clause will only be for the benefit for
Shareholders on the Register as of 5 April 2019 (being the record
date for the distribution of the Net Cash). In this way, the
Shareholders on the Register as of 5 April 2019 will be the sole
beneficiaries of any further consideration received pursuant to the
Anti-Embarrassment Clause.
Additional Information
Defined terms used but not defined in this announcement have
their meanings set out in the circular to shareholders which will
be available shortly on the Company's website at
www.taucapitalplc.com
Further announcements will be made in due course.
For further information, please contact:
FIM Capital Limited
Philip Scales Tel: +44 (0) 1624 681250
Allenby Capital Limited (Nominated Tel: +44 (0) 203 328 5656
Adviser and Joint Broker)
John Depasquale / Alex Brearley
---------------------------
Peterhouse Capital Limited (Joint Tel: +44 (0) 207 469 0933
Broker)
Lucy Williams / Eran Zucker
---------------------------
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END
IOECKPDBDBKDNND
(END) Dow Jones Newswires
March 15, 2019 07:30 ET (11:30 GMT)
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