Last checked at 6 Mar 2009 15:00
6 March 2009
LONZIM PLC
("LonZim" or the "Company")
LonZim Appoints Beaumont Cornish Limited as Nominated Adviser
Further information on Substantial and Related Party Transaction
Appointment of Nominated Adviser and Broker
LonZim is pleased to announce that Beaumont Cornish Limited ("Beaumont Cornish") has been appointed as nominated adviser ("NOMAD") and broker to the Company with immediate effect.
Substantial and Related Party Transaction
On 26 February 2009, the Company announced that it had acquired 59,682,817 ordinary shares in Lonrho plc, the AIM traded conglomerate with a structured portfolio of African investments ('Lonrho'). The Lonrho shares were acquired over a period of approximately three months and include the acquisition of 55,000,000 ordinary shares in a private placement by Lonrho at a price of 5p per share announced on 11 November 2008. Accordingly, in aggregate, LonZim now owns 7.81 per cent. of Lonrho. The total consideration was approximately £2.95 million which was funded out of the Company's cash resources.
Due to the interest of Lonrho in LonZim, as set out below, the acquisition of Lonrho shares under the private placement arranged by Lonrho is a Related Party Transaction within the meaning of the AIM Rules. Accordingly, the Company's independent non-executive directors (being Paul Heber and Paul Turner) have consulted with Beaumont Cornish and have confirmed that the terms of the acquisition of shares in Lonrho Plc in the Lonrho Plc placing to institutional shareholders (announced on the 11 November 2008) are fair and reasonable in so far as the Company's shareholders are concerned.
Lonrho is a 24.25 per cent. shareholder in LonZim and provides LonZim with management support services. LonZim has six directors. Of the four executive directors of LonZim, three are executive directors of Lonrho and one is a non-executive director of Lonrho. The acquisition of all Lonrho shares was proposed and approved by the LonZim non-executive directors, the executive directors having excused themselves. Lonrho has reported, in its unaudited interim statement for the six month period to 31 March 2008, Turnover of £17.8m, a Loss before tax of £6.3m and Net Assets of £83.6m. The restated (to comply with IFRS) unaudited figures for the year ended 30 September 2007 showed Turnover of £11.2m, a Loss before tax of £18.0m and Net Assets of £42.7m. The value of the ordinary shares held by LonZim in Lonrho based upon the closing mid market price on AIM on 5 March 2009 was approximately £2.196m. The shares are held by LonZim as a current asset investment.
Publication of audited results and recommencement of trading on AIM
It is anticipated that the Company's shares will recommence trading on AIM following publication of the audited annual accounts to shareholders. Headline numbers to be reported in the Company's audited annual accounts to the 31 August 2008, reflect a strong Balance Sheet with total assets of £35.8 million including £20.3 million in cash.
LonZim remains positive on the commercial opportunities that exist in the Zimbabwean economy and welcomes the potential clarity established as a result of the new Zimbabwean Government of National Unity. The Company has acquired a number of significant operational Zimbabwean businesses, as previously announced, which the Company views as having the potential for recovery and/or expansion on the eventual recovery of the Zimbabwe economy. During this acquisition process LonZim has also acquired a portfolio of real estate including industrial and office properties.
ENQUIRIES
| LonZim Plc | +44 (0)20 7016 5105 |
| David Lenigas, Executive Chairman | +44 (0)7881 825 378 |
| Geoffrey White, Chief Executive Officer | +44 (0)7717 307 308 |
| Emma Priestley, Executive Director | +44 (0)7867 785 177 |
| Beaumont Cornish Limited: NOMAD | |
| Roland Cornish | +44 (0) 207 628 3396 |
| Pelham Public Relations | |
| Charles Vivian | +44 (0) 20 7743 6672 +44 (0) 7977 297903 |
| James MacFarlane | +44 (0) 20 7743 6375 +44 (0) 7841 672831 |