29 Jul 2014 07:00
29 July 2014
Better Capital PCC Limited
(the "Company")
The Board has been informed that the office supplies businesses owned by BECAP Fund LP ("Fund I") and BECAP12 Fund LP ("Fund II") (together "the Funds"), Spicers and OfficeTeam respectively, have entered into a transaction whereby control of Spicers is taken over by the Fund II owned vehicle which owns OfficeTeam, a wider capital restructuring will take place over the next few weeks.
The businesses will continue to trade separately in recognition of their differing market positions with care being taken to respect the interests of customers. The management of both Spicers and OfficeTeam believe that this transaction will provide considerable benefits to their customers.
The Board of the Company and the General Partners of both Funds have been mindful of the possible conflicts in such a transaction.
The most important issue was to demonstrate a fair division of ownership between the Funds. Given Fund II's completion of the OfficeTeam acquisition a few days back, attributing its cost as value for a transaction was demonstrably sensible. Much careful review has taken place to arrive at a valuation of Fund I's investment in Spicers for the Company's 31 March accounts which are to be released tomorrow. That valuation of £6.1 million based upon asset valuations, together with the £5 million recent loan from Fund I, will be used to arrive at the ratio between the Funds and the resulting ownership will be 11.5% of the economic interest to Fund I and 88.5% to Fund II. Both ownerships will be subject to dilution by management in due course. Both Funds will be entirely pari-passu in the instruments they hold.
The above mentioned loan to Spicers from Fund I is being subsumed into this transaction.
Conflict could exist from the differing exit horizons of the Funds and steps have been taken to address this.
Both Funds will independently have directorship and information rights and will be treated economically in proportion in all respects.
Considering all these matters the General Partners of both Funds, having discussed the issues with advisers, are content that matters have been treated fairly between the Funds and that the economic benefits available fully justify this transaction with its clear industrial logic.
Enquiries:
Better Capital PCC Limited +44 (0)1481 716 000
Laurence McNairn (Administrator and Company Secretary)
Jon Moulton
Better Capital LLP +44 (0)20 7440 0840
Mark Aldridge (CEO)