NBI.L Share News (NBI)

million) to be satisfied by A$12.3 million (GBP7.1 million) in cash from the proceeds of the Placing, the Bank Facility and the Group's cash resources and the issue of Consideration Shares representing A$1.6 million (GBP0.9 million). In addition, subject to warranties given by the Vendor being satisfactory and there being no net asset adjustment, it is proposed that Northbridge Australia will pay to the Vendor a Deferred Consideration of A$3.0 million (GBP1.7 million) which will be satisfied in cash payable in two instalments. The first instalment of the Deferred Consideration of A$1.0 million (GBP0.6 million) would be payable on 30 December 2010. The second instalment of the Deferred Consideration of A$2.0 million (GBP1.2 million) would be payable on 30 September 2011. The Placing and Acquisition are conditional on the Company entering into the Acquisition Agreement, which the Board expects to do shortly, and the approval of Shareholders at the EGM. It is proposed that Tasman's three properties, located in Perth (Western Australia), Sale (Victoria) and Darwin (North Territory), will be transferred out of Tasman prior to Completion. The net book value of the properties as at 30 June 2009 was approximately A$8.4 million (GBP4.9 million). It is proposed that Northbridge Australia will lease the properties from the Vendor for a period of ten years from the date of Completion (subject to a break clause) at an aggregate annual rent of A$680,000 (GBP393,064) with periodic reviews. Following Completion, audited accounts of Tasman will be prepared. The aggregate purchase price will be adjusted upwards or downwards by A$1 for each A$1 by which the net assets of Tasman on the date of completion exceed or are less than A$5,660,152 plus 50 per cent. of the retained earnings (after tax and excluding profit and tax on the transfer of certain properties to the Vendor before Completion) of Tasman for the year ending 30 June 2010. Application will be made to the London Stock Exchange for the Consideration Shares to be admitted to trading on AIM. It is expected that the Acquisition will be completed, and dealings in the Consideration Shares on AIM will commence, on 30 July 2010. As part of the Acquisition Agreement, the Vendor will be required to enter into a lock-in agreement in respect of all of the Consideration Shares. Under the terms of the lock-in agreement, the Vendor will be required to agree not to sell, transfer or otherwise dispose of any Consideration Shares, other than in specified circumstances, for a period of 18 months following Completion. 5. Details of the Placing The Company is proposing to raise approximately GBP7.0 million (before expenses) through the issue of the Placing Shares at the Placing Price in order to part-fund the cash element of the consideration payable pursuant to the proposed transaction. The Placing Price represents a discount of approximately 6.0 per cent. to the closing mid-market price of 133 pence per Ordinary Share on 29 June 2010, being the last business day prior to the publication of this announcement. The Placing Shares will represent approximately 41.1 per cent. of the Enlarged Share Capital (excluding any treasury shares). Pursuant to the terms of the Placing Agreement, Arbuthnot Securities, as agent for Northbridge, has agreed conditionally to use its reasonable endeavours to procure Placees for the Placing Shares at the Placing Price. The Placing will not be underwritten. The Placing Agreement contains warranties from the Company in favour of Arbuthnot Securities (for itself and as agent for each of the Placees) and Smith & Williamson in relation to, inter alia, the accuracy of the information contained in this announcement and certain other matters relating to the Group and its business. In addition, the Company has agreed to indemnify Arbuthnot Securities and Smith & Williamson in relation to certain liabilities that may occur in respect of the Placing. The obligations of Arbuthnot Securities and Smith & Williamson under the Placing Agreement are conditional, inter alia, upon Admission having occurred by 8.00 a.m. on 23 July 2010 (or such later date as may be agreed, being no later than 6 August 2010), there being prior to Admission no material breach of the warranties given to Arbuthnot Securities and Smith & Williamson and Shareholders passing the Resolutions at the EGM. Arbuthnot Securities and/or Smith & Williamson may terminate the Placing Agreement in specified circumstances (including for breach of warranty at any time prior to Admission, if such breach is reasonably considered by Arbuthnot Securities and/or Smith & Williamson to be material in the context of the Placing) and in the event of a force majeure event occurring at any time prior to Admission. If the conditions of the Placing Agreement are not fulfilled on or before the relevant date in the Placing Agreement, application monies will be returned to applicants without interest as soon as possible thereafter. The Placing is conditional on the passing of the Resolutions set out in the Notice of EGM. Application will be made to the London Stock Exchange for the Placing Shares to be admitted to trading on AIM. The Placing Shares will rank pari passu in all respects with the Existing Ordinary Shares, including the right to receive any dividend or other distribution declared, made or paid following Admission. It is expected that Admission will become effective and that dealings in the Placing Shares will commence at 8.00 a.m. on 23 July 2010. As part of the Placing, the following Directors have agreed to subscribe in aggregate for 132,000 Placing Shares at the Placing Price, representing approximately 2.4 per cent. of the Placing Shares. Details of the Directors subscriptions and resultant interests following Completion are set out in the table below: +-----------------+----------+-----------+-----------+----------+ | | Immediately prior | Immediately | | | to Admission |Following Completion | +-----------------+----------------------+----------------------+ | Director | No. of | % of | No. of | % of | | | Ordinary | issued | Ordinary | Enlarged | | | Shares | share | Shares | Share | | | | capital1 | | Capital1 | +-----------------+----------+-----------+-----------+----------+ | | | | | | +-----------------+----------+-----------+-----------+----------+ | PR Harris | 800,000 | 8.95% | 880,000 | 5.76% | +-----------------+----------+-----------+-----------+----------+ | AK Mehta | 25,147 | 0.28% | 29,147 | 0.19% | +-----------------+----------+-----------+-----------+----------+ | JW Gould | 250,750 | 2.80% | 290,750 | 1.90% | +-----------------+----------+-----------+-----------+----------+ | MG Dodson | 281,250 | 3.15% | 289,250 | 1.89% | +-----------------+----------+-----------+-----------+----------+ 1. Excluding 152,150 Ordinary Shares held in treasury by Northbridge. In addition, Western Selection plc (of which David Marshall, a non-executive Director, is a director) has agreed to subscribe for 325,000 Placing Shares. Following Completion, Western Selection plc will be interested in 2,200,000 Ordinary Shares representing approximately 14.4 per cent. of the Enlarged Share Capital. 6. Bank Facility In order to finance part of the cash element of the consideration payable for the proposed Acquisition, the Company is proposing to enter into the Bank Facility. The Board considers that it is in the best interests of the Company that the cash element of the consideration payable for the proposed Acquisition be funded by a combination of debt and equity in order to maximise the return to Shareholders. 7. Current trading and future prospects On 25 March 2010, Northbridge reported its preliminary results for the year ended 31 December 2009 with consolidated revenue for the year of GBP12.7 million (2008: GBP15.7 million), gross profit of GBP7.5 million (2008: GBP8.0 million) and profit before taxation of GBP2.2 million (2008: GBP3.0 million). Gross margins improved to 59.0 per cent. from 51.0 per cent. in 2008. Earnings per share, excluding currency movements, continued to grow to 20.0 pence per share (2008: 19.4 pence per share). Net assets at 31 December 2009 were GBP12.4 million (2008: GBP10.0 million). Northbridge also announced an increase in its final dividend to 2.7 pence per share, raising the total dividend for the year to 4.1 pence per share (2008: 3.9 pence per share), an increase of 5.1 per cent. On 14 June 2010, the Company announced a number of new contract wins and a trading update. In the announcement the Company confirmed that overall activity had continued to grow and enquiries and quotes for the sale of manufactured units had increased compared with the levels of 2009. In addition rental demand had improved strongly in most of the Company's markets and the Group expected to report substantial growth in the first six months of 2010. As a result the Directors are confident that the Group's performance in 2010 will comfortably achieve the current market expectations for the year. 8. Irrevocable undertakings Certain of the Directors (and their related parties) and Western Selection plc have irrevocably undertaken to vote in favour of the Resolutions in respect of 3,498,397 Ordinary Shares, representing in aggregate, approximately 39.1 per cent. of the Existing Ordinary Shares. 9. Extraordinary General Meeting (MORE TO FOLLOW) Dow Jones Newswires June 30, 2010 02:00 ET (06:00 GMT)