TIDMBLEY
RNS Number : 9419M
Bailey(C.H.) PLC
14 January 2019
The information contained within this announcement is deemed by
the Group to
constitute inside information as stipulated under the Market
Abuse Regulations (EU)
No. 596/2014 ("MAR"). With the publication of this announcement
via a Regulatory
Information Service ("RIS"), this inside information is now
considered to be in the
public domain.
14 January 2019
C.H. BAILEY PLC
("C.H Bailey" or the "Group")
Proposed Cancellation of Admission to Trading on AIM
Proposed Capital Reorganisation
Top-Up Offer of up to 1,729,827 Existing Ordinary Shares
Tender Offer to purchase up to 2,316,168 Existing Ordinary
Shares
and
Notice of General Meeting
C.H. Bailey plc, the diverse group of businesses, with
investments and operations around the world in leisure, property,
principally in Tanzania, South Africa and Malta, and a UK
engineering business, announces that the Group has decided to seek
Shareholders' approval to cancel the admission of the Ordinary
Shares to trading on AIM pursuant to Rule 41 of the AIM Rules
("De-Listing").
As part of the De-Listing and in order to rationalise the
Company's shareholder base following the De-Listing, the Group
proposes to reorganise the existing share capital by Consolidation
and, following the Consolidation, to arrange the purchase by Arden,
of any Fractional Entitlements held by Shareholders at a price of
GBP1 for each Existing Ordinary Share comprised in such Fractional
Entitlement for subsequent Buyback from Arden by the Company.
The GBP1 payment for each Existing Ordinary Share compromised in
any Fractional Entitlements, the Tender Offer Price and the Top-Up
Price have each been calculated on the basis of:
-- the 92.50 pence closing mid-market price of an Existing
Ordinary Share at 6.00 pm on 11 January 2019, being the last
dealing day before the date of this announcement; plus
-- a premium of approximately 8.1% over that closing mid-market
price of an Existing Ordinary Share to reflect what the increase in
the share price of an Existing Ordinary Share would, theoretically,
be if all of the Treasury Shares as at the date of this
announcement were to be cancelled and, in each case, then rounded
to the nearest 1 penny.
The Group also proposes to offer such Qualifying Top-Up Offer
Shareholders who wish to remain as Shareholders after the
De-Listing has taken place and who do not want to lose their
Fractional Entitlements, the opportunity to increase their
shareholdings of Existing Ordinary Shares to the nearest multiple
of 10,000 ahead of the Consolidation. Shareholders who do not wish
to remain as Shareholders after the De-Listing has taken place will
have the opportunity to realise their investment in the Company by
accepting the Tender Offer pursuant to which Arden will,
conditionally, offer to purchase up to 2,316,168 Existing Ordinary
Shares at the Tender Offer Price of GBP1 per Existing Ordinary
Share.
The Consolidation will give rise to a number of Shareholders
becoming entitled to only a Fractional Entitlement to a New
Ordinary Share. Small Shareholders together with other Shareholders
who do not wish to acquire Top-Up Shares and do not wish to tender
their Existing Ordinary Shares to the Company shall, following the
Consolidation, have their Fractional Entitlements bought by Arden,
at a price of GBP1 for each Existing Ordinary Share comprised in
such Fractional Entitlements, for subsequent Buyback from Arden by
the Company. Further details of the Consolidation and arrangements
for the Fractional Entitlements are set out in the Circular and in
the announcement below.
The Directors consider the De-Listing to be in the best interest
of Shareholders, after considering, amongst other things, the costs
of maintaining trading in the Existing Ordinary Shares on AIM and
the limited liquidity in the Existing Ordinary Shares.
The Ordinary Shares will continue to be admitted to trading on
AIM, prior to the De-Listing. However, Shareholders should note the
timetable and further information below in relation to the Top-Up
Offer and the Tender Offer
The Group will today post to Shareholders a circular (the
"Circular") in connection with the Proposals containing a notice
convening a general meeting of the Group (the "GM") to be held at 2
p.m. on 6 February 2019 at the offices of Squire Patton Boggs (UK)
LLP, 7 Devonshire Square, London, EC2M 4YH.
Defined terms used in this announcement have the meaning set out
at the end of this announcement and as in the Circular.
Enquiries:
Further information:
Harry Sihra, Company Secretary
C H Bailey Plc
Tel: 01633 262961
Ciaran Walsh, Maria Gomez De Olea
Arden Partners plc
Tel: 020 7614 5900
EXTRACTS FROM THE CIRCULAR
The following has been extracted without amendment from, and
should be read in conjunction with, the Circular dated 14 January
2019, which will be available shortly from the Group's website:
http://chbaileyplc.co.uk/.
EXPECTED TIMETABLE OF PRINCIPAL EVENTS
Record Date for the Top-Up Offer(1) 6.00 pm on 11 January 2019
Determination of Qualifying Top-Up Offer Shareholders and Top-Up Offer Entitlements 6.00 pm on 11 January 2019
--------------------------------
Announcement of the Proposals 8.00 am on 14 January 2019
--------------------------------
Posting of the Circular, Top-Up Forms, Tender Forms, Forms of Proxy and notice 14 January 2019
convening the
General meeting
--------------------------------
Offer to Qualifying Top-Up Offer Shareholders opens 14 January 2019
--------------------------------
Offer to Qualifying Tender Offer Shareholders opens 14 January 2019
--------------------------------
CREST Top-Up Entitlements credited to stock accounts of Qualifying CREST 14 January 2019
Shareholders in CREST
--------------------------------
Latest time and date for receipt of Form of Proxy (to be received no later than 48 2 pm on 4 February 2019
hours before
the General Meeting)
--------------------------------
General Meeting 2 pm on 6 February 2019
--------------------------------
Announcement of results of General Meeting By 5.00 pm on 6 February 2019
--------------------------------
De-Listing and cancellation of admission of the Existing Ordinary Shares to trading 7.00 am on 14 February 2019
on AIM
--------------------------------
Latest time and date for receipt of Tender Forms and Top-Up Forms, TTE/USE 1.00 pm on 18 February 2019
instructions and
for payment in respect of the Top-Up Offer
--------------------------------
Record Date for the Tender Offer 6.00 pm on 18 February 2019
--------------------------------
Closing of the Top-Up Offer and transfer by the Company of Top-Up Shares to CREST 7.00 am on 19 February 2019
accounts
--------------------------------
Closing of the Tender Offer and purchase by Arden of Tender Offer Shares 7.00 am on 19 February 2019
--------------------------------
Purchase by Arden of Existing Ordinary Shares representing Fractional Entitlements 7.00 am on 19 February 2019
--------------------------------
Off-market purchase by the Company of Existing Ordinary Shares from Arden 7.30 am on 19 February 2019
--------------------------------
Cancellation of Existing Ordinary Shares purchased from Arden 7.45 am on 19 February 2019
--------------------------------
Record Date for the Consolidation 8.00 am on 19 February 2019
--------------------------------
Effective Date for the Consolidation 8.15 am on 19 February 20192019
--------------------------------
Dispatch of cheques/settlement of CREST payments for Tender Offer Shares By 4 March By 4 March 2019
2019
--------------------------------
Dispatch of cheques/settlement of CREST payments for Fractional Entitlements By 4 March 2019
--------------------------------
Dispatch of cheques/settlement of CREST payments for New Ordinary Shares By 4 March 2019
--------------------------------
1. It is important for Shareholders to note that the Top-Up
Offer is only available to Shareholders on the register of members
as at 6.00 pm on 11 January 2019 which is the Record Date for the
Top-Up Offer and the Top-Up Share Entitlement is calculated by
referencing to the shareholding at that time. The Top-Up Offer is
not available to individuals who become Shareholders, or to
Shareholders whose shareholdings change, after that date.
If any of the above times and/or dates change, the revised times
and/or dates will be notified in writing to Shareholders and/or by
announcement through a Regulatory Information Service. All times
are references to London time.
All events in the above timetable following the General Meeting
are conditional, inter alia, upon the approval of the
Resolutions.
The De-Listing requires the approval of not less than 75% of the
votes cast by Shareholders at the General Meeting.
INTRODUCTION
The Company today announced its proposals:
-- to cancel the admission of its Existing Ordinary Shares to trading on AIM;
-- as part of the De-Listing and in order to rationalise the
Company's shareholder base, to reorganise the existing share
capital by Consolidation and, following the Consolidation, to carry
out a buyback of Fractional Entitlements held by Shareholders at a
price of GBP1 for each Existing Ordinary Share comprised in such
Fractional Entitlements;
-- to offer such Qualifying Top-Up Offer Shareholders who wish
to remain as Shareholders after the De-Listing has taken place and
who do not want to lose their Fractional Entitlements, the
opportunity to increase their shareholdings of Existing Ordinary
Shares to the nearest multiple of 10,000 ahead of the
Consolidation; and
-- to provide Shareholders who do not wish to remain as
Shareholders after the De-Listing has taken place with an
opportunity to realise their investment in the Company by accepting
the Tender Offer pursuant to which Arden will, conditionally, offer
to purchase up to 2,316,168 Existing Ordinary Shares at the Tender
Offer Price of GBP1 per Existing Ordinary Share.
In considering the Proposals, the Directors have reflected on
the position of the Shareholders and their possible reasons for
investing in the Company. As a result, the Proposals have been
created to offer a number of possible options to the Shareholders,
irrespective of whether they wish to remain a Shareholder of the
Company or not following the De-Listing. Accordingly, the Directors
unanimously recommend that Shareholders vote in favour of the
Resolutions necessary to implement the Proposals.
This letter sets out the background to and reasons for, and
provides further details of, the Proposals including the terms and
conditions of, and the procedure for participating in, the Top-Up
Offer and Tender Offer, details of which can be found in the
accompanying Top-Up Form and Tender Offer Form.
Implementation of the Proposals, including the Top-Up Offer and
the Tender Offer, is conditional, inter alia, upon all of the
Resolutions being passed at the General Meeting to be held at 2.00
pm on 6 February 2019. The Notice of General Meeting convening the
General Meeting at which the Resolutions will be proposed is set
out at the end of the Circular.
Shareholders should note that unless all the Resolutions are
approved at the General Meeting by the requisite majority, the
Proposals will not proceed.
GENERAL BACKGROUND
The Company is proposing the De-Listing for the reasons set out
in paragraph 3 of this Part I below. In addition, the Company is
proposing to:
-- consolidate its existing share capital because the Company
has a share register which includes a significant number of
Shareholders holding a very small percentage of the total number of
Existing Ordinary Shares. The Consolidation will give rise to a
number of Shareholders becoming entitled to only a Fractional
Entitlement to a New Ordinary Share. Small Shareholders together
with other Shareholders who do not wish to acquire Top-Up Shares
and do not wish to tender their Existing Ordinary Shares to the
Company shall, following the Consolidation, have their Fractional
Entitlements bought by Arden, at a price of GBP1 for each Existing
Ordinary Share comprised in such Fractional Entitlements, for
subsequent Buyback by the Company. Further details of the
Consolidation and arrangements for the Fractional Entitlements are
set out on pages 13 to 14 of the Circular;
-- offer Shareholders who, following the De-Listing, wish to
remain as Shareholders and who hold more than 10,000 Existing
Ordinary Shares but not an exact multiple of 10,000 Existing
Ordinary Shares as at the Record Date for the Top-Up Offer, the
opportunity to purchase Top-Up Shares which means that such
Shareholders will not lose any Fractional Entitlements upon the
Consolidation. Further details of the Top-Up Offer is set out on
page 15 of the Circular and in Part II of the Circular; and
-- offer an exit route for Shareholders who, following the
De-Listing, do not wish to remain as Shareholders by the means of
selling their Existing Ordinary Shares to Arden pursuant to the
Tender Offer for subsequent Buyback by the Company. Further details
of the Tender Offer is set out on page 16 of the Circular and in
Part III of the Circular.
As at the date of this announcement, the Company holds 671,959
Existing Ordinary Shares in the capital of the Company as Treasury
Shares. Applications for Top-Up Shares will be satisfied firstly
from the Treasury Shares. In the event that applications for Top-Up
Shares are received which are in excess of the number of Treasury
Shares available then Resolutions 2 and 5 to be proposed at the
General Meeting will authorise the Company to issue additional
Existing Ordinary Shares in order to satisfy such applications. The
Treasury Shares hold the same rights in regards to voting and
distribution as the shares currently in circulation to the
Shareholders and no changes will be made to the existing share
rights following the De-Listing.
DE-LISTING
Reasons for the De-Listing
The Board has conducted a review of the benefits and drawbacks
to the Company in retaining its listing on AIM. The Board believes
that the De-Listing is in the best interests of the Company and its
Shareholders as a whole. In reaching this conclusion, the Board has
considered the following key factors:
-- the management time and the legal and regulatory burden
associated with maintaining the Company's admission to trading on
AIM is, in the Directors' opinion, disproportionate to the benefits
to the Company;
-- there is, and has been for some time, a lack of liquidity in
the Existing Ordinary Shares such that there is a very limited
market for the Existing Ordinary Shares; and
-- there is limited trading of the Existing Ordinary Shares.
Over the past 12 months 116,590 Existing Ordinary Shares were
traded representing approximately 1.4 per cent. of the issued share
capital and giving an average daily volume of approximately 457
Existing Ordinary Shares. Accordingly, the costs associated with
maintaining the AIM quotation are considered by the Directors to be
disproportionately high when compared to the benefits of being
listed on AIM, even though these costs have been, so far as
reasonably possible, controlled and minimised by the Company. The
Board believes that these funds could be better utilised for the
benefit of the Company.
Effect of De-Listing
The Directors consider that the principal effects of the
De-Listing will be that:
-- Shareholders will no longer be able to buy and sell Ordinary
Shares through AIM or any other public stock market, further
reducing the liquidity in the Ordinary Shares;
-- in due course, Ordinary Shares will no longer be held in, or
traded through, CREST but will be held in paper form only;
-- the Company will no longer be required to announce material
events or financial results through a Regulatory Information
Service;
-- the Company will no longer be required to comply with many of
the corporate governance requirements applicable to companies
traded on AIM;
-- Arden will cease to be the nominated adviser and broker to the Company;
-- the Company will no longer be subject to the Disclosure and
Transparency Rules and will therefore no longer be required to
publicly disclose major shareholdings in the Company;
-- the Company will no longer be subject to the AIM Rules, with
the consequence that Shareholders will no longer be afforded the
protections given by the AIM Rules. Such protections include a
requirement to obtain shareholder approval for reverse takeovers
and fundamental changes in the Company's business and to announce,
inter alia, certain substantial and/or related party transactions;
and
-- the De-Listing may have either positive or negative taxation
consequences for Shareholders. Shareholders who are in any doubt
about their tax position should consult their own professional
independent adviser immediately.
Shareholders should note that the Takeover Code will continue to
apply to the Company following the De-Listing.
The Company will also continue to be bound by the Act (which
requires shareholder approval for certain matters) following the
De-Listing.
De-Listing Process
Under the AIM Rules, the De-Listing can only be effected by the
Company after securing a resolution passed by 75% of the votes cast
by its Shareholders in a general meeting of the Company and the
expiry of a period of 20 clear Business Days from the date on which
notice of the De-Listing is given to the London Stock Exchange. In
addition, a period of at least five clear Business Days following
Shareholders' approval of the De-Listing is required before the
De-Listing may become effective. Resolution 6 seeks the approval of
Shareholders for the De-Listing. Assuming that the Resolution is
approved, it is proposed that the De-Listing will take place by
7.00 am on 14 February 2019.
New Ordinary
Share dealing following De-Listing Following the De-Listing,
there will be no market facility for dealing in the New Ordinary
Shares, no price will be publicly quoted for the New Ordinary
Shares and the transfer of New Ordinary Shares will be subject to
the provisions of the Articles of the Company. As such, holdings of
New Ordinary Shares will be difficult to value and sell. However,
while there can be no guarantee of any Shareholders being able to
purchase or sell any New Ordinary Shares, any Shareholder seeking
to do so should contact the Company at its registered office.
THE CONSOLIDATION, TOP-UP OFFER AND TER-OFFER
As set out in the Expected timetable of principal events above,
completion of the Top-Up Offer and the Tender Offer and the
Consolidation will take place shortly following the De-Listing.
Background to the Consolidation
The Register includes a large number of Shareholders holding a
very small percentage of the total Existing Ordinary Shares. This
creates a financial and logistical burden for the Company which is
disproportionate to its size, particularly in the context of the
proposed De-Listing. Therefore a consolidation of the Existing
Ordinary Shares is proposed, which the Board has deemed to be an
appropriate and commonly used method of reducing the excessive
length of a company's share register. Shareholder approval is
required for the Consolidation.
As at close of business on 11 January 2019 (being the latest
practicable date prior to the publication of this announcement),
the Company had 8,335,413 Existing Ordinary Shares in issue, having
a mid-market price per Existing Ordinary Share at the close of
business on such date of 92.50 pence. As at that date, the Company
had sixty eight Shareholders, of which twenty nine held fewer than
10,000 Existing Ordinary Shares. As at 6.00pm on 11 January 2019,
being the latest practicable date prior to the publication of this
announcement, a shareholding of 10,000 Existing Ordinary Shares was
worth GBP9,250 at the mid-market price. Thus a significant number
of Shareholders hold a small number of shares in the Company and
(based upon the closing mid-market price of an Existing Ordinary
Share of 92.50 pence at 6.00 pm on 11 January 2019) the twenty nine
Shareholders each holding fewer than 10,000 Existing Ordinary
Shares have an aggregate holding worth GBP117,425 being just 1.66%
of the Company's market capitalisation.
Your Board believes that the cost of administering the Company's
Shareholder register and communicating with such a large number of
Shareholders (many of whom have only a small interest in the
Company) is to the detriment of the Company and its current
Shareholders taken as a whole.
Accordingly, the Company has arranged for Arden to buy the
Fractional Entitlements which will accrue to the Shareholders (save
for any Qualifying Top-Up Offer Shareholders who accept the Top-Up
Offer) on the Consolidation without any transaction cost being
charged to the Shareholders. This will benefit the Small
Shareholders who may have considered selling their Existing
Ordinary Shares but decided not to do so due to the
disproportionate dealing and administration costs relating to such
a sale. It will also guarantee that Small Shareholders are able to
exit the Company shortly after the De-Listing has taken place. The
Company will subsequently Buyback the Fractional Entitlements from
Arden.
The Consolidation
Upon implementation of the Consolidation, Shareholders on the
Register of the Company at the Record Date for the Consolidation,
will exchange every 10,000 Existing Ordinary Shares that they hold
for one New Ordinary Share.
As a consequence of the Consolidation, if you hold 10,000 or
fewer Existing Ordinary Shares at the Record Date for the
Consolidation, your Fractional Entitlement to a New Ordinary Share
will be purchased by Arden, at a price of GBP1 for each Existing
Ordinary Share comprised in such Fractional Entitlement, and you
will receive the proceeds of sale, free of dealing costs. The
Company itself intends to subsequently Buyback those Fractional
Entitlements from Arden, pursuant to the Repurchase Agreement.
If you hold an exact multiple of 10,000 Existing Ordinary Shares
at the Record Date for the Consolidation then you will receive the
relevant number of New Ordinary Shares and you will have no
Fractional Entitlement.
If you hold more than 10,000 Existing Ordinary Shares but your
holding is not divisible exactly by 10,000, you will be left with a
whole number of New Ordinary Shares together with a Fractional
Entitlement. If you are such a Qualifying Top-Up Offer Shareholder
and, prior to the Record Date for the Consolidation, you have not
purchased additional Existing Ordinary Shares on the market or
Top-Up Shares under the Top-Up Offer then your Fractional
Entitlement to a New Ordinary Share will be purchased by Arden and
you will receive the proceeds of sale, free of dealing costs.
Pursuant to the terms of the Repurchase Agreement, the Company
shall purchase the Fractional Entitlements from Arden at the same
price as they were purchased by Arden from Shareholder and the
purchased shares will then be cancelled.
If you hold a share certificate in respect of your Existing
Ordinary Shares it will no longer be valid from the time the
proposed Consolidation takes effect. If you are entitled to any New
Ordinary Share(s), you will be sent a new share certificate by 4
March 2019 and upon receipt, you should destroy the old
certificate(s). If you hold your Existing Ordinary Shares in
uncertificated form (that is, in CREST), you should expect to have
your CREST account adjusted to reflect New Ordinary Shares by 4
March 2019 or as soon as practicable after the Consolidation takes
effect. Existing Ordinary Shares credited to any stock account in
CREST will be disabled and all Existing Ordinary Shares will be
removed from CREST in due course.
The New Ordinary Shares created by the Consolidation will have
the same rights as the Existing Ordinary Shares.
Share Price Calculation
The payment of GBP1 for each Existing Ordinary Share compromised
in any Fractional Entitlements,
the Tender Offer Price and the Top-Up Price have each been
calculated on the basis of:
(a) the 92.50 pence closing mid-market price of an Existing
Ordinary Share as at the close of business on 11 January 2019,
being the last dealing day before the date of this announcement;
plus
(b) a premium of approximately 8.1% over that closing mid-market
price of an Existing Ordinary Share to reflect what the increase in
the share price of an Existing Ordinary Share would, theoretically,
be if all of the Treasury Shares as at the date of this
announcement were to be cancelled, in each case then rounded to the
nearest 1 penny.
Top-Up Offer
Upon implementation of the Consolidation, Shareholders on the
register of members of the Company at the Record Date for the
Consolidation who do not participate in the Tender Offer, will
exchange every 10,000 Existing Ordinary Shares that they hold for
one New Ordinary Share. If you hold more than 10,000 Existing
Ordinary Shares at the Record Date for the Consolidation, then
unless your holding is divisible by 10,000 you will be left with a
whole number of New Ordinary Shares together with a Fractional
Entitlement.
If you are in this position and if you do not wish to
participate in the Tender Offer and if you do not wish to have your
Fractional Entitlement sold then you might wish to consider
increasing your shareholding of Existing Ordinary Shares to a
multiple of 10,000. There are two methods to do that, namely:
(a) you could seek to purchase on the market such number of
Existing Ordinary Shares as you may decide provided that the trade
completes prior to the Record Date for the Consolidation; or
(b) you could choose to participate in the Top-Up Offer.
Shareholders who are nominees holding Existing Ordinary Shares
on behalf of more than one beneficial owner will be entitled to
participate in the Top-Up Offer in respect of any beneficial owner
as would, if the Existing Ordinary Shares were registered in the
name of such beneficial owner, constitute a Qualifying Top-Up Offer
Shareholder. Shareholders who are nominees and who apply for Top-Up
Shares on behalf of beneficial owners should note the relevant
representations and warranties given in relation to such
applications as referred to in Part III of this Part 1 of the
Circular in the two sections headed "Effect of Application".
Pursuant to the Top-Up Offer you are granted the right to
purchase, ahead of the Consolidation, such number of Top-Up Shares
as will take your shareholding up to the nearest multiple of 10,000
so that, following the Consolidation, you will be left with a whole
number of New Ordinary Shares.
The Top-Up Price has been calculated on the basis of the Share
Price Calculation. If you are a Qualifying Top-Up Offer
Shareholder, your Top-Up Share Entitlement has been calculated as
at the Record Date for the Top-Up Offer.
The Top-Up Offer is conditional on, inter alia, the passing of
the Resolutions as set out in the Notice of General Meeting at the
end of the Circular.
If you elect not to purchase additional Existing Ordinary Shares
pursuant to the Top-Up Offer but still wish to remain a Shareholder
of the Company and hold a Fractional Entitlement above a multiple
of 10,000 Existing Ordinary Shares, your Fractional Entitlement
will be purchased from you by Arden in accordance with paragraph 5
of Part I of the Circular. For the avoidance of doubt, Qualifying
Top-Up Offer Shareholders wishing to remain a Shareholder of the
Company will, should they elect not to purchase additional Existing
Ordinary Shares, still have every 10,000 Existing Ordinary Shares
they hold at the Record Date for the Consolidation consolidated
into 1 New Ordinary Share and only their Fractional Entitlement
will be purchased by Arden.
If you are a Qualifying Top-Up Offer Shareholder you need to
consider carefully whether you wish to purchase additional Existing
Ordinary Shares pursuant to the Top-Up Offer. You need to bear in
mind the proposed De-Listing and that, subject to the passing of
the Resolutions, neither the Existing Ordinary Shares, nor the New
Ordinary Shares, will be admitted to trading on AIM. A Qualifying
Top-Up Offer Shareholder should only apply for Top-Up Shares if
they are making a positive decision that they wish to remain as a
shareholder in the Company following the De-Listing and if, as part
of that positive decision, they wish to ensure that they do not
lose any Fractional Entitlements to a Consolidated Share pursuant
to the Consolidation.
Qualifying Top-Up Shareholders who do not wish to remain as
shareholders in the Company following the De-Listing should not
apply for Top-Up Shares but should, instead, consider accepting the
Tender Offer (described further below).
Full details of the Top-Up Offer are set out in Part III of the
Circular and the ISIN of the CREST Top-Up Entitlement is
GB00BHNBGK05
Tender Offer
The Board recognises that not all Shareholders will wish to
continue to own Ordinary Shares in the Company following the
De-Listing. Subject to the Tender Conditions being satisfied,
Qualifying Tender Offer Shareholders will therefore have the
opportunity to tender, pursuant to the Tender Offer, all, but not
some only, of their Existing Ordinary Shares at the Record Date for
the Tender Offer.
In order for Shareholders who are nominees holding Existing
Ordinary Shares on behalf of more than one beneficial owner to
participate in the Tender Offer in respect of individual beneficial
owners who would, if the Existing Ordinary Shares were registered
in the names of such beneficial owners, constitute Qualifying
Tender Offer Shareholders, the nominee will need to split the
registered holding into separately designated accounts; one account
for the total number of shares to be tendered then separately
designated accounts for each beneficial owner who would constitute
a Small Shareholder and who is unable to tender their Existing
Ordinary Shares which will
therefore be repurchased as Fractional Entitlements, and one for
the remaining holding which will be subject to the Consolidation
(this should be the original designated account and any Top-Up
Offer Shares which have been applied for will be allotted to this
account). The nominee must then submit a TTE for the entire holding
of the account from which the shares will be tendered.
Qualifying Tender Offer Shareholders are not obliged to tender
any Existing Ordinary Shares and, if they do not wish to
participate in the Tender Offer, Qualifying Tender Offer
Shareholders should not complete or return their Tender Form.
Shareholders in any doubt as to what action to take, are
recommended to seek immediate professional advice from their
stockbroker, solicitor, accountant or other independent financial
adviser duly authorised under FSMA who specializes in advising upon
investments in shares and other securities.
Under the Tender Offer, Arden will purchase up to 2,316,168
Existing Ordinary Shares from Qualifying Tender Offer Shareholders
at GBP1 per Existing Ordinary Share.
The Tender Offer Price will be calculated on the basis of the
Share Price Calculation.
The Tender Offer is conditional on, inter alia, the passing of
the Resolutions as set out in the Notice of the General Meeting at
the end of the Circular.
Existing Ordinary Shares not validly tendered and which do not
become Fractional Entitlements will not be purchased. Existing
Ordinary Shares purchased pursuant to the Tender Offer will be
purchased free of commissions and dealing charges.
Pursuant to the terms of the Repurchase Agreement, all New
Ordinary Shares and Fractional Entitlements derived from
successfully tendered Existing Ordinary Shares purchased by Arden
under the Tender Offer will be repurchased by the Company at an
aggregate price equal to the price paid by Arden for such shares.
Such shares will be immediately cancelled. For the avoidance of
doubt, no shares repurchased by the Company will be retained as
Treasury Shares.
Qualifying Tender Offer Shareholders who retain a shareholding
following completion of the Tender Offer will, on completion of the
De-Listing, hold New Ordinary Shares in a non-publicly traded
company. As such, there will be no market facility for dealing in
the New Ordinary Shares.
Full details of the Tender Offer are set out in Part IV of the
Circular.
The attention of Qualifying Tender Offer Shareholders who are
citizens or nationals of or resident in jurisdictions outside the
United Kingdom and who wish to participate in the Tender Offer is
drawn to the section headed "Overseas Shareholders" in Part IV of
the Circular. The Tender Offer is not being made, directly or
indirectly, in or into any Restricted Jurisdiction.
Interaction of Top-Up Offer and Tender Offer
The Top-Up Offer and the Tender Offer are exclusive of each
other. If you are both a Qualifying Top-Up Offer Shareholder and a
Qualifying Tender Offer Shareholder you need to choose to take part
in one or other such Offer, or neither of them. If applications are
received from a Shareholder under both the Top-Up Offer and the
Tender Offer then the Top-Up Offer application will be rejected and
the Shareholder will be deemed to have tendered their entire
holding of Existing Ordinary Shares pursuant to the Tender
Offer.
FRACTIONAL ENTITLEMENTS
Subject to completion of the Consolidation, Shareholders
entitled to any Fractional Entitlement following the Consolidation
will receive cash in lieu of those Fractional Entitlements.
Arden shall purchase the Fractional Entitlements of all
Shareholders entitled to Fractional Entitlements following the
Consolidation on the following basis:
-- The price payable for the Fractional Entitlements calculated
on the basis of GBP1 for each Existing Ordinary Share comprised in
such Fractional Entitlements.
-- Completion is to take place at 7.00 am on 19 February 2019
and payment of the cash consideration is to be made to the
Shareholders by cheque or through their CREST accounts (as
appropriate) by 4 March 2019.
-- The Shareholders will receive payment of the sale proceeds of
their Fractional Entitlements by cheque if they hold their Shares
in certificated form, or, if held through CREST, their CREST
accounts will be credited by 4 March 2019, and all such Fractional
Entitlements which are purchased by the Company will be
cancelled.
-- Pursuant to the terms of the Repurchase Agreement, the
Company will purchase the Fractional Entitlements from Arden. The
aggregate of all Fractional Entitlements shall then be
cancelled.
Example 1 - Small Shareholders
If a Small Shareholder holds 5,000 Existing Ordinary Shares at
the Record Date for the Consolidation, such Small Shareholder will,
following the implementation of the Consolidation, hold a
Fractional Entitlement to half of a New Ordinary Share. Immediately
following the Consolidation, such Fractional Entitlement will be
aggregated with all other Fractional Entitlements and purchased by
Arden, without any transaction cost being charged to the
Shareholder. Based upon the Share Price Calculation, the Small
Shareholder would receive GBP5,000 for its shareholding of 5,000
Existing Ordinary Shares.
Example 2 - other Shareholders
If a Shareholder holds 11,000 Existing Ordinary Shares at the
Record Date for the Consolidation and such Shareholder has not
participated in the Top-Up Offer, such Shareholder will, following
the implementation of the Consolidation, hold 1 New Ordinary Share
derived from 10,000 Existing Ordinary Shares with the remaining
1,000 Existing Ordinary Shares forming a 1/10th Fractional
Entitlement of a New Ordinary Share. Immediately following the
Consolidation, the Fractional Entitlement will be aggregated with
all other Fractional Entitlements and purchased by Arden, without
any transaction cost being charged to the Shareholder. Based upon
the Share Price Calculation, the Shareholder would receive GBP1,000
for his shareholding of 1,000 Existing Ordinary Shares in addition
to the 1 New Ordinary Share.
Rights attaching to the New Ordinary Shares
The New Ordinary Shares arising on implementation of the
Consolidation will have the same rights as the Existing Ordinary
Shares, including voting, dividend and other rights.
CURRENT TRADING AND FUTURE PROSPECTS
The Company published its interim financial results on 7
December 2018. The Company's highlights and outlook sections are
detailed below:
"Group Highlights
Overall
-- Value of the Malta property increases and improves the
Company's assets and income statement value.
-- Operations in Tanzania affected by reduced economic activity in the country.
-- Revenue in South Africa reduced due to the fire at Galenia in
February 2018 with anticipated recovery in the second half of the
financial year.
-- Growth in revenues at B.I.E, the UK engineering business.
Finance
-- Group Revenue is down 4% to GBP2,609k (2017: GBP2,713k).
-- Gross profit margin is down to 28.9% (2017: 30.2%).
-- EBITDA at GBP1,188k is up 18% (2017: GBP1,006k).
-- Group Operating profit is up 42% at GBP776k (2017: GBP547k).
-- Overall profit is up 43% at GBP601k (2017: GBP421k).
Outlook
We will continue to maintain our market position in Tanzania.
Our involvement in new development projects in an advisory capacity
will indirectly help our hospitality business and we remain
positive in our potential future growth in the country.
South Africa is expected to remain steady as the country
stabilises and attracts new local and inward investment. We hope to
locate and benefit from further property development opportunities
in Cape Town, and to make progress with the development plans in
Montagu.
Malta still grows in international economic stature. We hope to
find further development sites in Valletta or other opportunities
on the island, where we have invested for over 50 years and know
the local market well.
We believe there will be continued growth in the UK engineering
business. However, the continued uncertainty of Brexit may impact
our customers' businesses and therefore could have an adverse
effect on our business growth.
Operating in emerging markets and niche industries, like heavy
engineering in the UK, it is difficult to predict the future but we
remain positive and cautiously optimistic."
The directors of the Company can confirm that, since the date of
publication of the interim financial results, there has been no
significant change in the trading or financial position of the
Company.
Following the Consolidation and De-Listing, the Company intends
to continue operating as it has done over the Company's last
financial year and carry out the same activities, and retain the
same business strategy, as a private company, that it did as a
public company. Based on current market conditions, the Company
does not envisage any significant changes to the Company's trading
position once the Consolidation and De-Listing are completed.
GENERAL MEETING
The General Meeting will be held on 6 February 2019 at 2.00 pm,
at which Shareholders will be asked to consider and, if thought
fit, pass the Resolutions.
Ordinary resolutions require the approval of the majority of
those Shareholders present and voting (in person or by proxy) at
the General Meeting. Special resolutions require the approval of
not less than 75% of those shareholders present and voting (in
person or by proxy) at the General Meeting.
The Resolutions, which are summarised below, are necessary for
the implementation of the Proposals. Accordingly, the Directors
recommend that Shareholders vote in favour of the Resolutions as
they intend to do in relation to their respective shareholdings.
The reasons for the recommendation in this paragraph are as set out
in this Circular and, in particular, in the "recommendation"
paragraph below. As regards Resolutions 1 and 5, the amount to be
paid for the equity securities referred to in those Resolutions is
the Top-Up Price which has been calculated as described in the
paragraph headed "Share Price Calculation" so as to be consistent
with the Tender Offer Price and the price to be paid for the
Existing Ordinary Shares that represent Fractional
Entitlements.
Resolution 1
This Resolution is required for the purposes of the Top-Up
Offer.
Resolution 1 is proposed as a special resolution to authorise
the Company to sell the Existing Ordinary Shares currently held by
the Company as Treasury Shares for cash as if section 561 of the
Act did not apply to such sale. Such authority is proposed to be
limited to the sale of Treasury Shares up to a total nominal value
of GBP67,195. The proposed authority set out in Resolution 1 shall
expire on 20 August 2020 but prior to its expiry the Directors may
make offers, and enter into agreements, which would, or might,
require Treasury Shares to be sold after the authority expires and
the Directors may sell Treasury Shares under such offer or
agreement as if the authority had not expired.
Resolution 2
This Resolution is also required for the purposes of the Top-Up
Offer in the event that the Treasury Shares are insufficient to
satisfy all applications for Top-Up Shares.
Resolution 2 is proposed as an ordinary resolution to authorise
the Company, in accordance with section 551 of the Act, to allot
equity securities for cash up to a total nominal value of
GBP105,787. The proposed authority set out in Resolution 2 shall
expire on 20 August 2020 but prior to its expiry the Directors may
make offers, and enter into agreements, which would, or might,
require equity securities to be sold after the authority expires
and the Directors may sell equity securities under such offer or
agreement as if the authority had not expired.
Resolution 3
This Resolution is required for the purposes of the Repurchase
Agreement, the Tender Offer and the purchase of the Fractional
Entitlements.
Resolution 3 is proposed as an ordinary resolution to approve
the Repurchase Agreement and to authorise the Company to, in
accordance with the Act, make the Buyback from Arden, pursuant to
the Repurchase Agreement, of such number of Existing Ordinary
Shares as are successfully tendered pursuant to the Tender Offer
and the Fractional Entitlements which will arise from the
Consolidation.
Resolution 4
This Resolution is required for the purposes of the
Consolidation and is proposed as an ordinary resolution.
Resolution 4 is a resolution that all of the Existing Ordinary
Shares be consolidated into, and redesignated as, New Ordinary
Shares at a ratio of 10,000 Existing Ordinary Shares to 1 New
Ordinary Share. Furthermore, the Directors are authorised to deal
with the Fractional Entitlements arising from the Consolidation as
described in the Circular pursuant to their powers under the
Articles.
Resolution 5
This Resolution is also required for the purposes of the Top-Up
Offer in the event that the Treasury Shares are insufficient to
satisfy all applications for Top-Up Shares. Resolution 5 is
proposed as a special resolution to disapply the statutory
pre-emption provisions of section 561 of the Act in relation to any
shares to be allotted pursuant to Resolution 2.
Resolution 6
This Resolution relates to the De-Listing and is proposed as a
special resolution for the cancellation of the admission of the
Existing Ordinary Shares to trading on AIM.
ACTION TO BE TAKEN
General Meeting
Shareholders will find enclosed with the Circular a Form of
Proxy for use at the General Meeting. The Form of Proxy should be
completed and returned in accordance with the instructions printed
thereon so as to arrive at the Company's Registrar, Computershare
Investor Services PLC, at The Pavilions, Bridgwater Road, Bristol
BS99 6AH as soon as possible and in any event not later than 2.00
pm on 4 February 2019. The completion and return of a Form of Proxy
will not preclude you from attending and voting in person at the
General Meeting or any adjournment thereof, if you so wish and are
so entitled.
If the Form of Proxy is not returned by 2.00 pm on 4 February
2019, your vote will not count.
Top-Up Offer
If you are a Qualifying Top-Up Offer Shareholder and wish to
participate in the Top-Up Offer, you should follow the procedure
for applying for Top-Up Shares. Full details of the Top-Up Offer,
and the procedure to be followed by Qualifying Top-Up Offer
Shareholders wishing to apply for Top-Up Shares, are set out in
Part III of the Circular.
The procedure for applying for Top-Up Shares depends on whether
a Qualifying Top-Up Offer Shareholder holds Existing Ordinary
Shares in certificated or uncertificated form.
Qualifying Top-Up Offer Shareholders who hold Existing Ordinary
Shares in certificated form and who wish to apply for Top-Up Shares
should complete a Top-Up Form in accordance with the instructions
set out in Part III of the Circular and the instructions printed on
the Top-Up Form itself and return it by post to Computershare
Investor Services PLC at The Pavilions, Bridgwater Road, Bristol
BS99 6AH or (during normal business hours only) by hand to
Computershare Investor Services PLC at The Pavilions, Bridgwater
Road, Bristol BS13 8AE as soon as possible and, in any event, so as
to arrive by no later than 1.00 pm on 18 February 2019. Share
certificates for the New Ordinary Shares will be despatched no
later than 4 March 2019.
Qualifying Top-Up Offer Shareholders who hold Existing Ordinary
Shares in uncertificated form and who wish to apply for Top-Up
Shares should follow the CREST procedures set out in Part III of
the Circular. The CREST instruction must have settled no later than
1.00 pm on 18 February 2019.
Tender Offer
If you are a Qualifying Tender Offer Shareholder and wish to
participate in the Tender Offer, you should follow the procedure
for tendering shares. Full details of the Tender Offer, and the
procedure to be followed by Qualifying Tender Offer Shareholders
wishing to tender their Existing Ordinary Shares, are set out in
Part IV of the Circular.
The procedure for tendering Existing Ordinary Shares on the
Register at the Record Date for the Tender Offer depends on whether
a Qualifying Tender Offer Shareholder holds Existing Ordinary
Shares in certificated or uncertificated form.
Qualifying Tender Offer Shareholders who hold Existing Ordinary
Shares in certificated form and who wish to tender all or some of
their Existing Ordinary Shares held at the Record Date for the
Tender Offer should complete a Tender Form in accordance with the
instructions set out in Part IV of the Circular and the
instructions printed on the Tender Form itself and return it,
together with their original share certificate(s) by post to
Computershare Investor Services PLC at The Pavilions, Bridgwater
Road, Bristol BS99 6AH or (during normal business hours only) by
hand to Computershare Investor Services PLC at The Pavilions,
Bridgwater Road, Bristol BS13 8AE as soon as possible and in any
event so as to arrive by no later than 1.00 pm on 18 February
2019.
Qualifying Tender Offer Shareholders who hold Existing Ordinary
Shares in uncertificated form and who wish to tender all or some of
their Existing Ordinary Shares held at the Record Date for the
Tender Offer should tender electronically through CREST so that the
TTE Instruction settles by no later than 1.00 pm on 18 February
2019. If Existing Ordinary Shares are held under different member
account IDs, a separate TTE Instruction should be sent for each
member account ID.
If you are in any doubt as to what action you should take, you
are recommended to seek your own personal financial advice from
your broker, bank manager, solicitor, accountant or other
independent financial adviser authorised under the Financial
Services and Markets Act 2000 if you are resident in the United
Kingdom or, if not, from another appropriately authorised
independent financial adviser, immediately.
DIRECTORS' INTENTIONS, AND IRREVOCABLE UNDERTAKINGS
The Directors, who together hold 5,390,855 Existing Ordinary
Shares representing approximately 64.67% of the Existing Ordinary
Shares in issue, have each confirmed to the Company that they
intend to vote in favour of all of the Resolutions.
Mr Charles Bailey has undertaken to the Company that he intends
to apply for his Top-Up Share Entitlement and that he will not be
accepting the Tender Offer
Mr Christopher Fielding has undertaken to the Company that he
will not apply for his Top-Up Share Entitlement and that he will be
accepting the Tender Offer.
Mr David Wilkinson has undertaken to the Company that he will
not apply for his Top-Up Share Entitlement and that he will be
accepting the Tender Offer.
RECOMMENDATION
The Directors consider that the Proposals are fair and
reasonable and are in the best interests of the Company and its
Shareholders as a whole. Your Directors consider it appropriate
that the Qualifying Top-Up Offer Shareholders should have the
choice as to whether they, if they wish to remain as Shareholders
in the Company following the De-Listing, should be able to increase
their holding of Existing Ordinary Shares prior to the
Consolidation so as to not lose any Fractional Entitlements upon
the Consolidation. Your Directors also consider it appropriate that
the Qualifying Tender Offer Shareholders should have the choice as
to whether to remain Shareholders in the Company following the
De-Listing and that, accordingly, they should be given an
opportunity to realise their investment under the Tender Offer
prior to the De-Listing. However, the Directors make no
recommendation to Qualifying Top-Up Offer Shareholders or to
Qualifying Tender Offer Shareholders in relation to their
participation in the Top-Up Offer or the Tender Offer and recommend
that all such Shareholders consult their duly authorised
independent advisers before they make a decision as to whether to
apply for Top-Up Shares or to tender their Existing Ordinary
Shares, in order to obtain advice relevant to their particular
circumstances.
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
END
MSCDGGDBISBBGCX
(END) Dow Jones Newswires
January 14, 2019 02:00 ET (07:00 GMT)
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