25 Jul 2012 12:43
Dods (Group) plc ("Dods" or the "Company")
Placing
Further to the Company's announcement on 11 June 2012, Dods announces that it is proposing to raise approximately £6.1 million (before expenses) by the issue of 110,821,556 new Ordinary shares ("Placing Shares") at a price of 5.5 pence each (the "Placing") to Lord Ashcroft KCMG. This price represents a premium of approximately 18.8 per cent to the closing mid-market price of 4.63 pence on 24 July 2012, being the latest practicable date prior to the release of this announcement.
This placing is conditional, inter alia, on shareholder approval to authorise the Directors of the Company to allot the Placing Shares and to disapply pre-emption rights.
Subject to completion of the Placing, Lord Ashcroft KCMG is expected to hold approximately 44.2 per cent of the voting rights of the Company which, without a waiver from the Takeover Panel would require Lord Ashcroft KCMG to make a Rule 9 offer for the Company. The Panel has agreed to such a waiver following receipt of written confirmations from independent shareholders who hold, in aggregate, in excess of 50 per cent of the Company's existing voting rights consenting to such waiver.
The Company has proceeded with the Placing, believing that there are significant opportunities for growth through the acquisition of other businesses which will complement the existing business proposition and offer synergy benefits. In addition, the Board recognises that Dods needs to upgrade its technology platforms which will allow it to develop new products and to invest in sales and business processes to ensure it can deliver long term growth.
Consequently, the Board have decided that the Placing will be beneficial to the Company and in the interest of Shareholders and that the funds provided by Lord Ashcroft KCMG, as initially envisaged in the announcement of the placing on 12 January 2012, will provide the Company with the funding required to execute on its investment and growth strategy.
On 28 June 2012, the Company released an AGM statement commenting on its trading performance. The Board has nothing further to update since this announcement and will be providing a full trading update in the Company's Interim Results, to be published in September.
The Placing Shares will represent 32.6 per cent of the enlarged share capital of the Company.
Application will be made to the London Stock Exchange for the Placing Shares to be admitted to trading on AIM. It is expected that Admission will become effective, and dealings in the new Ordinary shares will commence, at 8am on 21 August 2012.
Related Party Transaction
As at 24 July 2012, being the latest practicable date prior to the release of this announcement, Lord Ashcroft KCMG held Ordinary Shares representing approximately 17.2 per cent of the Existing Ordinary Shares. As stated above, Lord Ashcroft KCMG has agreed to subscribe for 110,821,556 Placing Shares. Under the AIM Rules, as a Shareholder holding more than 10 per cent of the Existing Ordinary Shares, Lord Ashcroft KCMG is a related party of the Company and the subscription by Lord Ashcroft KCMG for the Placing Shares constitutes a related party transaction. Where a company enters into a related party transaction, under the AIM Rules the independent directors of the company are required, after consulting with the company's nominated adviser, to state whether, in their opinion, the transaction is fair and reasonable in so far as its shareholders are concerned. Having consulted with Cenkos Securities, the Company's nominated adviser, the Independent Directors believe that the participation by Lord Ashcroft KCMG in the Placing is fair and reasonable in so far as Shareholders are concerned.
The AIM Rules do not prohibit Lord Ashcroft KCMG from exercising the voting rights attached to his holding of Ordinary Shares at the Extraordinary General Meeting.
Extraordinary General Meeting
The Extraordinary General Meeting is to be held at the offices of Cenkos Securities plc, 6.7.8 Tokenhouse Yard, London EC2R 7AS at 11.00 am on 20 August 2012 for the purposes of considering and, if thought fit, passing the Resolutions. A notice convening the Extraordinary General Meeting is set out in a circular, which is expected to be posted to shareholders on 25 July 2012.
The Resolutions deal with the following matters:
(i) Resolution 1, which will be proposed as an ordinary resolution, is to authorise the Directors (conditionally upon Admission) to allot the Placing Shares up to an aggregate nominal value of £1,108,215.56, such authority to expire at the conclusion of the next annual general meeting of the Company; and
(ii) Resolution 2, which will be proposed as a special resolution, is to disapply Shareholders' statutory pre-emption rights (which would otherwise require the Company to offer all cash allotments of Shares first to existing Shareholders in proportion to their holdings) in relation to the issue of the Placing Shares up to an aggregate nominal value of £1,108,215.56, such authority also to expire at the conclusion of the next annual general meeting of the Company.
Enquiries
For further information please contact:
Dods (Group) plc +44 (0)20 7593 5500
Keith Sadler, Finance Director
Cenkos +44 (0)20 7397 8900
Nicholas Wells/Adrian Hargrave