28 Jul 2017 11:02
28 July 2017
Asa Resource Group Plc
("Asa," or the "Company")
Suspension of shares and Posting of Offer Document
As announced by the Board of Asa on 19 May 2017, cash within Asa has been constrained by the currency restrictions imposed by the Reserve Bank of Zimbabwe.
These restrictions have worsened since April 2017 following the Company's announcement that internal investigations had revealed significant funds had been remitted from operating subsidiaries in Zimbabwe and not properly accounted for. As a direct consequence, the Company has not been able to receive adequate funding from its operating subsidiaries and, accordingly, is struggling to meet its ongoing liabilities.
The Company has outstanding creditors relating to legacy litigation, normal corporate expenses, consultant's fees and unpaid directors' fees and salaries. The Board has been pursuing a number of refinancing options, but has not been able to finalise anything as yet and Asa's cash flow remains a serious concern.
Additionally, funds remitted to Group entities in Hong Kong under the direction of Mr Yat Hoi Ning and Mr Yim Kwan prior to their removal as directors have not been accounted for and the records of these entities have not been released to the Group's auditors by Mr Yat Hoi Ning, who controls the premises within which they are believed to be contained. Similarly, the directors do not have control of the bank accounts in Hong Kong for the Group's entities that appear to remain under the control of Messrs Ning and Kwan.
Measures that were put in motion by the Board to address Asa's cash flow problem have been delayed as a result of Asa entering into an offer period under the Takeover Code.
In the light of the above, the Board has been advised that it must have regard to the interests of the creditors of the Company and its subsidiaries when making decisions in relation to the Group.
The Board is consulting insolvency practitioners to better understand the obligations and duties of the directors of the Company in such circumstances and to decide upon the most appropriate course of action that should be taken by the Company.
In light of the above circumstances, at the request of the Company, Asa's ordinary shares have been suspended from trading on AIM with effect from 11:00 am, today 28 July 2017.
The Company's ordinary shares will remain suspended from trading on AIM whilst the Board continues with its evaluation of these matters.
Posting of offer document
The Board of Asa also notes the announcement made by RPI on 25 July 2017, confirming the posting of an offer document (the "Offer Document") in respect of its cash offer to acquire the entire issued and to be issued ordinary share capital of Asa (the "Offer").
The Offer is being made at 2.1 pence per ordinary share in cash and is on the terms, and subject to the conditions, set out in the Offer Document.
The Board had engaged in discussions with Rich Pro Investments Ltd ("RPI") with a view to being able to provide a recommendation to shareholders in respect of the Offer. Unfortunately, the Board did not receive the level of assurances it was seeking regarding the areas of concern which it raised with RPI.
In accordance with Rule 26.1 of the City Code a copy of the Offer Document, the announcement by RPI and this announcement will be available on the Company's website: www.asaresourcegroup.com. The content of such website is not incorporated into and does not form part of this announcement.
The Company will issue further announcements as appropriate.
Market Abuse Regulation (MAR) Disclosure
Certain information contained in this announcement would have been deemed inside information for the purposes of Article 7 of Regulation (EU) No 596/2014 until the release of this announcement.
Contact
For more information http://www.asaresourcegroup.com/ or contact us below.
Asa Resource Group plc
One Fleet Place, London EC4M 7WS
Ian B Dearing, Executive Director, Group Legal Advisor and Company Secretary
Niall Henry, non-executive Director (Investor Relations)
communications@asaresourcegroup.com
Nominated Adviser and Broker
SP Angel Corporate Finance LLP
Prince Frederick House, 35-39 Maddox Street, London W1S 2PP
John Mackay, Jeff Keating, Caroline Rowe
Tel: +44 (0) 20 3470 0470
Disclosure requirements of the Code
Under Rule 8.3(a) of the Code, any person who is interested in 1% or more of any class of relevant securities of an offeree company or of any securities exchange offeror (being any offeror other than an offeror in respect of which it has been announced that its offer is, or is likely to be, solely in cash) must make an Opening Position Disclosure following the commencement of the offer period and, if later, following the announcement in which any securities exchange offeror is first identified. An Opening Position Disclosure must contain details of the person's interests and short positions in, and rights to subscribe for, any relevant securities of each of (i) the offeree company and (ii) any securities exchange offeror(s). An Opening Position Disclosure by a person to whom Rule 8.3(a) applies must be made by no later than 3.30 pm (London time) on the 10th business day following the commencement of the offer period and, if appropriate, by no later than 3.30 pm (London time) on the 10th business day following the announcement in which any securities exchange offeror is first identified. Relevant persons who deal in the relevant securities of the offeree company or of a securities exchange offeror prior to the deadline for making an Opening Position Disclosure must instead make a Dealing Disclosure.
Under Rule 8.3(b) of the Code, any person who is, or becomes, interested in 1% or more of any class of relevant securities of the offeree company or of any securities exchange offeror must make a Dealing Disclosure if the person deals in any relevant securities of the offeree company or of any securities exchange offeror. A Dealing Disclosure must contain details of the dealing concerned and of the person's interests and short positions in, and rights to subscribe for, any relevant securities of each of (i) the offeree company and (ii) any securities exchange offeror(s), save to the extent that these details have previously been disclosed under Rule 8. A Dealing Disclosure by a person to whom Rule 8.3(b) applies must be made by no later than 3.30 pm (London time) on the business day following the date of the relevant dealing.
If two or more persons act together pursuant to an agreement or understanding, whether formal or informal, to acquire or control an interest in relevant securities of an offeree company or a securities exchange offeror, they will be deemed to be a single person for the purpose of Rule 8.3.
Opening Position Disclosures must also be made by the offeree company and by any offeror and Dealing Disclosures must also be made by the offeree company, by any offeror and by any persons acting in concert with any of them (see Rules 8.1, 8.2 and 8.4).
Details of the offeree and offeror companies in respect of whose relevant securities Opening Position Disclosures and Dealing Disclosures must be made can be found in the Disclosure Table on the Takeover Panel's website at www.thetakeoverpanel.org.uk, including details of the number of relevant securities in issue, when the offer period commenced and when any offeror was first identified and when the Rule 2.6 (28 day "put-up or shut-up") deadline is. You should contact the Panel's Market Surveillance Unit on +44 (0)20 7638 0129 if you are in any doubt as to whether you are required to make an Opening Position Disclosure or a Dealing Disclosure.