Posting of Circular, Placing and Notice of General Meeting
12 Janeiro 2011 - 12:41PM
UK Regulatory
TIDMRGT
ReGen Therapeutics Plc
("ReGen" or the "Company")
Posting of Circular, Placing and Notice of General Meeting
The Company announces that it has today posted a circular to shareholders
proposing a restructuring of the Company. This involves, inter alia, a demerger
of the ReGen Business, which constitutes both a fundamental change in the
Company's business pursuant to AIM Rule 15 and a related party transaction
pursuant to AIM Rule 13. If, inter alia, the resolutions to accept these
proposals are passed, the Company will be classified as an Investing Company
pursuant to AIM Rule 15.
The Company has today placed 11,000,000 ordinary shares at a price of 0.5 pence
per share, raising GBP55,000. Further details in relation to this placing are set
out below.
Conditional on the proposals in the circular being passed by shareholders, the
Company has raised GBP1,500,000 through the issue of 300,000,000 new ordinary
shares at a price of 0.5 pence per share, further detail are set out below.
Notice of a General Meeting of the Company, to be held 11.00 am on 28 January
2011 at the offices of Bird & Bird LLP, 15 Fetter Lane, London EC4A 1JP, is
included in the circular.
Extracts from the circular are set out below. The full circular is available for
download from the Company's website, www.regentherapeutics.com, and any defined
terms found in this announcement are defined therein.
Introduction
ReGen proposes to demerge its existing business into a new company and transfer
the shares of that new company to the Shareholders. ReGen will then become an
Investing Company.
The Demerger will allow Shareholders to hold shares in two distinct entities
with separate strategic, capital and economic characteristics and management
teams:
* ReGen Therapeutics Plc (to be renamed Alexander David Investments PLC) will
be an Investing Company (whose shares are traded on AIM) which will target
investment opportunities predominately in basic resources and the oil and
gas sectors.
* ReGen NewCo Limited (to be renamed ReGen Therapeutics Limited), (whose
shares are intended to be traded on JP Jenkins) shall carry on the business
of the manufacture and sale of Colostrinin(TM).
The Demerger will constitute a fundamental change of business of the Company
which, under Rule 15 of the AIM Rules, requires Shareholder approval.
Accordingly, in accordance with the AIM Rules and the Act, the Company is
required to send a circular to Shareholders setting out the reasons for, and
principal terms of, the Demerger. This Document also provides details of the
proposed Reduction of Capital, Investing Policy and Placing, and seeks
Shareholders' approval for the Demerger, the Reduction of Capital, the adoption
of the Investing Policy and issue of new ReGen Ordinary Shares pursuant to the
Placing.
The purpose of this Document is to:
* explain the background to and reasons for the Proposals;
* explain why the Board believes the Proposals are in the best interests of
Shareholders and why it unanimously supports the Proposals;
* explain the Proposals and the Resolutions to be put to Shareholders at the
General Meeting; and
* recommend that Shareholders vote in favour of the Resolutions to be proposed
at the General Meeting to be held at 11.00 am at the offices of Bird & Bird
LLP, 15 Fetter Lane, London EC4A 1JP on 28 January 2011 and which are set
out in the notice of General Meeting at the end of this Document.
The Demerger is conditional (among other things) on:
* the approval by Shareholders of the Resolutions at the General Meeting; and
* the confirmation of the Reduction of Capital by the Court.
Should the Proposals not be approved by Shareholders and/or the Court or should
the Company not be able to successfully raise funding in the manner described in
the Circular, the Board would need to explore urgently other financing
opportunities for the Company including possible third party finance. Should the
Company not raise such third party finance, there is a significant risk that the
Company would need to cease trading.
If the Demerger is completed, the table below summarises the Shareholders'
shareholding position by way of example using a holding of 1,000 ReGen Ordinary
Shares:
+--------------------------------------+--------+----------------+------------+
| | ReGen* | New Warrants** | NewCo |
+--------------------------------------+--------+----------------+------------+
| | | | |
+--------------------------------------+--------+----------------+------------+
| Market on which shares are tradeable | AIM | Unlisted | JP Jenkins |
+--------------------------------------+--------+----------------+------------+
| Shareholding before Demerger | 1,000 | - | - |
+--------------------------------------+--------+----------------+------------+
| Shareholding after Demerger | 1,000 | 100 | 1,000 |
+--------------------------------------+--------+----------------+------------+
* to be renamed Alexander David Investments Plc after the Demerger
** New Warrants are exercisable at 0.5 pence per ReGen Ordinary Shares
Summary of the Demerger
The Demerger will be effected by taking the following steps:
* the transfer of the ReGen Business to NewCo in consideration for which NewCo
will issue NewCo Shares to ReGen. This step has already been effected;
* a bonus issue of 'B' Ordinary Shares to Shareholders on a one for one basis
(see further below); and
* following a reduction of ReGen's share capital (in accordance with the Act),
Shareholders who are in the ReGen Register at the Record Time will receive:
One NewCo Share for each ReGen Ordinary Share
Shareholders will also continue to hold their existing ReGen Ordinary Shares and
the Company will be renamed Alexander David Investments PLC.
Related Party Transaction
In connection with the Demerger,
(i) the Company is proposing to lend up to GBP240,000 to NewCo; and
(ii) the ReGen Business has been transferred to NewCo and Timothy Shilton and
Norman Lott, two of the existing Directors, have been appointed as the directors
of NewCo.
These two aspects of the Proposals are deemed to be related party transactions
(the "Transactions") pursuant to Rule 13 of the AIM Rules.
Percy Lomax, Martin Small and Peter Garrod are considered to be independent of
the Transactions for the purposes of Rule 13. These independent directors,
having consulted with the Company's nominated adviser, Cairn Financial Advisers
LLP, believe that the terms of the Transactions referred to in paragraphs (i)
and (ii) above are fair and reasonable insofar as the Shareholders are
concerned.
Placing and Warrants
The Company has today placed 11,000,000 new ReGen Ordinary Shares at 0.5 pence
per ReGen Ordinary Share to raise GBP55,000, before expenses to fund its general
working capital requirements pending the Demerger (the "Interim Placing").
Application for the 11,000,000 new ReGen Ordinary Shares to be traded on AIM
has been made to the London Stock Exchange. Trading in these shares is expected
to commence on or around 18 January 2011. The 11,000,000 new ReGen Ordinary
Shares will rank pari passu in all respects with the existing ReGen Ordinary
Shares.
Following the Interim Placing described above the share capital of the Company
will comprise 89,446,548 ReGen Ordinary Shares of 0.01 pence each.
Furthermore, conditional on completion of the Demerger, Alexander David, the
Company's broker, has placed 300,000,000 new ReGen Ordinary Shares at 0.5 pence
per ReGen Ordinary Share to raise GBP1,500,000, before expenses (the "Placing").
Application for the 300,000,000 new ReGen Ordinary Shares to be traded on AIM
will be made to the London Stock Exchange. Trading in these shares is expected
to commence on or around 18 February 2011. The 300,000,000 new ReGen Ordinary
Shares will rank pari passu in all respects with the existing ReGen Ordinary
Shares.
Following the Placing the issued share capital of the Company will comprise
389,446,548 ReGen Ordinary Shares of 0.01 pence each.
Subscribers of the new ReGen Ordinary Shares in the Placing will also receive
one New Warrant for every ten (10) ReGen Ordinary Shares subscribed. Each New
Warrant will entitle the holder to subscribe for one ReGen Ordinary Share at the
Placing Price and will have an exercise period of two years.
The Placing proceeds will be used to cover the costs of the Proposals, the
Directors Compensation Payments, the payment of existing creditors, the proposed
loan to NewCo, general working capital purposes and for new investments in
accordance with the Investing Policy.
Alexander David will receive an advisory fee of GBP10,000 and a placing commission
of 5 per cent. of the gross funds raised in the Placing. In addition, for the
arrangement and structuring of the new business of the Company, Alexander David
will receive on completion of the Demerger a warrant of 29.9 per cent. of the
share capital of the Company in issue immediately following the Placing. The ADS
Warrant will have an exercise price equal to the Placing Price and shall be
exercisable for a period of 5 years from the date of completion of the Demerger.
The Board recognise that, as a result of the Interim Placing and the Placing,
Shareholders will experience significant dilution to their shareholdings.
Accordingly, it is proposed that immediately following the Demerger,
Shareholders at the Record Time will be granted one New Warrant for every ten
(10) ReGen Ordinary Shares.
Each New Warrant will entitle the holder to subscribe for one ReGen Ordinary
Share at the Placing Price and will have an exercise period of two years.
The instrument constituting the New Warrants will be available for inspection at
the General Meeting and will after the Demerger be available on the Company's
website www.regentherapeutics.com. Following the Demerger, the Company will
announce its new website address via a Regulatory Information Service.
Enquiries:
ReGen Therapeutics Plc +44 20 7153 4920
Percy Lomax
Cairn Financial Advisers LLP +44 20 7148 7900
Nominated Adviser
Liam Murray / Avi Robinson
Alexander David Securities Limited +44 20 7448 9820
Broker
David Scott / Nick Bealer
This announcement is distributed by Thomson Reuters on behalf of
Thomson Reuters clients. The owner of this announcement warrants that:
(i) the releases contained herein are protected by copyright and
other applicable laws; and
(ii) they are solely responsible for the content, accuracy and
originality of the information contained therein.
Source: ReGen Therapeutics Plc via Thomson Reuters ONE
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