Last checked at 7 Nov 2014 07:00
THIS ANNOUNCEMENT AND THE INFORMATION CONTAINED HEREIN IS NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION IN WHOLE OR IN PART, DIRECTLY OR INDIRECTLY, IN OR INTO AUSTRALIA, CANADA, JAPAN OR THE UNITED STATES OR ANY SUCH JURISDICTION IN WHICH SUCH PUBLICATION OR DISTRIBUTION IS PROHIBITED
7 November 2014
FILTRONIC PLC
("Filtronic" or the "Company")
Placing of 9,716,000 new Ordinary Shares at 22.0 pence per share
Filtronic is pleased to announce a conditional placing with existing investors and management of 9,716,000 new Ordinary Shares (the "Placing Shares") at 22.0 pence per Ordinary Share (the "Placing Price") (the "Placing").
Details of the Placing
The Company expects to raise £2.1 million (£2.0 million net of expenses) by way of an issue of the Placing Shares at the Placing Price.
The Placing Shares represent approximately 9.99 per cent. of the existing issued share capital of the Company and will, upon Admission, rank pari passu in all respects with the Ordinary Shares in issue as at the date of this Announcement.
Application will be made to the UK Listing Authority and the London Stock Exchange, respectively, for the Placing Shares to be admitted to the Official List and to trading on the London Stock Exchange's main market for listed securities. It is expected that Admission of the Placing Shares will become effective and dealings in them will commence on the London Stock Exchange at 8.00 a.m. on 3 December 2014.
In connection with the Placing, all members of the Board of Filtronic are participating in the Placing, and have agreed to subscribe for an aggregate of 579,833 Placing Shares, all at the Placing Price.
The net proceeds of the Placing are expected to be approximately £2.0 million and will provide additional finance to the Company for working capital purposes in line with the anticipated increase in activity in the second half of the financial year ending 31 May 2015 and beyond.
A General Meeting of Filtronic to approve the Placing will be held on 28 November 2014 at 11.00 a.m. at the offices of Panmure Gordon (UK) Limited, One New Change, London EC4M 9AF.
Alan Needle, Chief Executive of Filtronic said:
"We are delighted by the support demonstrated by shareholders for the fundraising announced today. In line with our stated strategy of aligning with OEMs, we are seeing a pick-up in activity associated with the 4G roll out. This requires a greater investment to prepare for deployment. The funds raised will enable us to strengthen our working capital position to continue to pursue opportunities for both Wireless and Broadband. The Board is confident about the prospects for the business."
Smaller Related Party Transactions
Pursuant to paragraph 11.1.10 of the Listing Rules, it is disclosed that the following related parties have agreed to participate in the Placing:
Name of Related Party | Number of Placing Shares | Value of Placing shares at Placing Price |
Alan Needle (Director) | 440,910 | £97,000.20 |
Aberforth Partners LLP (substantial shareholder) | 2,283,919 | £502,462.18 |
Legal and General Investment Management Ltd (substantial shareholder) | 1,706,200 | £375,364.00 |
For further information please contact:
Filtronic plc | Tel. 0113 220 0000 |
Howard Ford (Chairman) | |
Alan Needle (CEO) | |
Rob Smith (CFO) | |
Panmure Gordon (UK) Limited | Tel. 020 7459 3600 |
Dominic Morley (Corporate Finance) Tom Salvesen (Corporate Broking) | |
Walbrook PR Limited | Tel. 020 7933 8780 or filtronic@walbrookpr.com |
Paul McManus | Mob. 07980 541 893 |
Paul Cornelius | Mob. 07827 879 460 |
1. Background to the Placing
Filtronic plc designs and manufactures microwave electronics products for the wireless telecoms infrastructure market.
(a) Wireless Division
The Wireless Division is currently trading in line with expectations. Whilst operator activity is subdued in some of Filtronic's markets, there is strong original equipment manufacturer ("OEM") demand for products, driven by the global 4G LTE (Long Term Evolution) infrastructure roll-out. Over 40 products are in design, development and pre-production and multiple orders have been received from Alcatel Lucent, Motorola, Nokia and Ericsson. OEM shipments are expected to increase significantly in the second half of the current financial year and the Board believes that current activity and client wins underpin longer-term prospects.
A new, purpose built antenna assembly and testing line has been opened by Filtronic's sub-contract manufacturer in China to satisfy the forecast demand for these types of products, with two of its five antenna products expected to enter volume shipments over the next few months.
The Board expects to begin shipment on several OEM programmes in the second half of its financial year. These include antennas, tower mounted amplifiers, filters and combiners.
(b) Broadband Division
As previously announced, in the Broadband Division, there is a greater than usual degree of uncertainty over the second half outlook due to uncertainties surrounding the Russian market due to the geopolitical situation in the Ukraine.
Additionally one E-band programme with a US OEM has been delayed due to the customer's internal technical issues. Whilst this E-band programme is currently on hold, programmes with other OEMs are progressing well. Selex has recently announced contract awards and continues to be an important customer. The division's advanced manufacturing and test facilities provide opportunities to address the wider market for RF subsystems.
(c) Growth opportunities
As well as ongoing growth in its core business areas, the Board sees a number of opportunities for further growth in antennas, where a range of advanced integrated antennas are under development to satisfy forecast demand from OEMs and operators; in advanced ceramic compounds for use in frequency diplexers; in China, where there is an opportunity to supply the Chinese OEM market in conjunction with a channel partner; and as a result of a distribution agreement to increase the revenues for contract manufacturing and test utilising Broadband's facilities.
2. Use of proceeds
Filtronic has been selected by a number of OEMs to design, develop and qualify a range of products including tower mounted amplifiers, antennas, combiners, filters and diplexers. Several of these programmes are expected to commence volume production in the second half of the financial year ending 31 May 2015 and some orders have been received. In line with the anticipated ramp in activity, the Company now seeks additional finance for working capital purposes.
Additionally, the proceeds of the Placing will enable the Company to undertake the following:
· support qualification processes for existing OEM customers in the wireless business, such qualification being a precondition to selection as a supplier to OEMs; and
· new product design and development for of a range of advanced integrated antennas, frequency diplexers using advanced ceramic compounds.
3. Details of the Placing
The Company is proposing to raise £2.1 million (before expenses) by way of a placing of 9,716,000 new Ordinary Shares at a price of 22.0 pence per share.
Application will be made to the UK Listing Authority and the London Stock Exchange, respectively, for the Placing Shares to be admitted to the Official List and to trading on the London Stock Exchange's main market for listed securities. It is expected that Admission of the Placing Shares will become effective and dealings in them will commence on the London Stock Exchange at 8.00 a.m. on 3 December 2014. The Placing Shares will rank pari passu in all respects with the Existing Shares.
The Placing is conditional upon, inter alia, the passing of the Resolutions to be proposed at the General Meeting and upon Admission becoming effective by not later than 8.00 a.m. on 3 December 2014 (or such later time or date as may be agreed by Panmure Gordon and the Company, not being later than 8.00 a.m. on 10 December 2014).
In connection with the Placing, all members of the Board of Filtronic are participating in the Placing. The interests of the Directors and persons discharging management responsibility (PDMR) as at the date of this document and on Admission are, or expected to be, as follows:
As at the date of this document | Following the Placing | |||||||
Director / PDMR | Number of Ordinary Shares | Percentage of issued share capital | Number of Placing Shares to be allotted and issued | Number of Ordinary Shares | Percentage of issued share capital |
| ||
Alan Needle | 2,246,142 | 2.312 | 440,910 | 2,687,052 | 2.514 |
| ||
Howard Ford | 106,422 | 0.110 | 13,578 | 120,000 | 0.112 |
| ||
Reg Gott | 102,159 | 0.105 | 52,270 | 154,429 | 0.144 |
| ||
Graham Meek | 89,722 | 0.092 | 25,000 | 114,722 | 0.107 |
| ||
Maura Moynihan | 77,222 | 0.079 | 13,630 | 90,852 | 0.085 |
| ||
Michael Roller | 26,212 | 0.027 | 2,621 | 28,833 | 0.027 |
| ||
Rob Smith | 12,202 | 0.013 | 45,454 | 57,656 | 0.054 |
| ||
DEFINITIONS
The following definitions and technical terms apply throughout this document, unless the context otherwise requires:
"Admission" | admission of the Placing Shares to: (i) the premium segment of the Official List; and (ii) trading on the London Stock Exchange's main market for listed securities becoming effective in accordance with, respectively, the Listing Rules and the Standards; |
"Board" or "Directors" | the directors of the Company; |
"Company" or "Filtronic" | Filtronic plc; |
"Existing Shares" | the 97,160,986 Ordinary Shares in issue as at 6 November 2014 (being the latest practicable date prior to the publication of this document); |
"GM" or "General Meeting" | the general meeting of the Company to be held at Panmure Gordon at 11.00 a.m. on 28 November 2014; |
"Listing Rules" | the rules and regulations published by the Financial Conduct Authority for the purposes of Part VI of the Financial Services and Markets Act 2000 (as amended); |
"London Stock Exchange" | London Stock Exchange plc; |
"Official List" | the Official List of the UK Listing Authority; |
"Ordinary Shares" | ordinary shares of 10 pence nominal value each in the capital of the Company; |
"Panmure Gordon" | Panmure Gordon (UK) Limited; |
"Placing" | the proposed placing of 9,716,000 new Ordinary Shares; |
"Placing Price" | 22.0 pence per Placing Share; |
"Placing Shares" | 9,716,000 new Ordinary Shares to be issued pursuant to the Placing; |
"Resolutions" | the resolutions to be proposed at the General Meeting; |
"Securities Act" | the United States Securities Act of 1933 (as amended); |
"Shareholder" | a holder of Ordinary Shares; |
"Standards" | the requirements contained in the "Admission and Disclosure Standards" dated April 2013 containing, amongst other things, the admission requirements to be observed by companies seeking admission to trading on the London Stock Exchange's market for listed securities; |
"UK" or "United Kingdom" | the United Kingdom of Great Britain and Northern Ireland; |
"UK Listing Authority" or "UKLA" | the Financial Conduct Authority acting in its capacity as the competent authority for the purposes of Part VI of the Financial Services and Markets Act 2000 (as amended); |
"US" or "United States" | the United States of America, its territories and possessions, any state of the United States and the District of Columbia; and |
"£" | pounds sterling, the lawful currency of the United Kingdom. |
IMPORTANT INFORMATION
This announcement has been issued by, and is the sole responsibility of, the Company. This announcement is for information only and does not constitute or form part of an offer or invitation to underwrite, subscribe for or otherwise acquire or dispose of any securities or investment advice in any jurisdiction.
THIS ANNOUNCEMENT IS NOT INTENDED, AND SHOULD NOT BE CONSTRUED, AS AN OFFER OF SECURITIES FOR SALE IN THE UNITED STATES OR ANY OTHER JURISDICTION. SECURITIES MAY NOT BE OFFERED OR SOLD IN THE UNITED STATES ABSENT REGISTRATION OR AN EXEMPTION FROM REGISTRATION. THE PLACING SHARES DESCRIBED HEREIN HAVE NOT BEEN AND WILL NOT BE REGISTERED UNDER THE U.S. SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR THE LAWS OF ANY STATE OF THE UNITED STATES OR ANY JURISDICTION THEREOF, AND MAY NOT BE OFFERED, SOLD, RE-SOLD, TRANSFERRED OR DELIVERED, DIRECTLY OR INDIRECTLY, IN OR INTO THE UNITED STATES, ABSENT REGISTRATION OR PURSUANT TO AN EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND IN COMPLIANCE WITH THE SECURITIES LAWS OF ANY STATE OR OTHER JURISDICTION IN THE UNITED STATES.
The distribution of this announcement and the Placing of the Placing Shares as set out in this announcement in certain jurisdictions may be restricted by law. No action has been taken that would permit an offering of such shares or possession or distribution of this announcement or any other offering or publicity material relating to such shares in any jurisdiction where action for that purpose is required. Persons into whose possession this announcement comes are required by the Company to inform themselves about, and to observe, such restrictions. Any failure to comply with these restrictions may constitute a violation of the securities laws of any such jurisdiction.
This announcement includes statements that are, or may be deemed to be, "forward-looking statements". These forward-looking statements are based on the Company's current expectations and projections about future events and can be identified by the use of a date in the future or forward-looking terminology, including, but not limited to, the terms "may", "believes", "estimates", "plans", "aims", "targets", "projects", "anticipates", "expects", "intends", "will", "could" or "should" or, in each case, their negative or other variations or comparable terminology. These forward-looking statements include matters that are not historical facts and include statements regarding the Company's intentions, beliefs or current expectations. They are not guarantees of future performance. By their nature, forward-looking statements involve risk and uncertainty because they relate to future events and circumstances. A number of factors could cause actual results and developments to differ materially from those expressed or implied by the forward-looking statements. Any forward-looking statements in this announcement reflect the Company's view with respect to future events as at the date of this announcement and are subject to risks relating to future events and the Company's operations, results of operations, financial condition, growth, strategy, liquidity and the industry in which the Company operates. No assurances can be given that the forward-looking statements in this announcement will be realised. Neither the Company nor Panmure Gordon (UK) Limited ("Panmure Gordon") undertake any obligation, nor do they intend, to revise or update any forward-looking statements in this announcement to reflect events or circumstances after the date of this announcement (except, in the case of the Company, to the extent required by the FCA, the London Stock Exchange or by applicable law, the Listing Rules or the Disclosure Rules and Transparency Rules). None of the future projections, expectations, estimates or prospects in this announcement should be taken as forecasts or promises nor should they be taken as implying any indication, assurance or guarantee that the assumptions on which such future projections, expectations, estimates or prospects have been prepared are correct or exhaustive or, in the case of the assumptions, fully stated in the announcement. As a result of these risks, uncertainties and assumptions, prospective investors should not place undue reliance on these forward-looking statements as a prediction of actual results or otherwise. Forward-looking statements in this announcement are current only as of the date on which such statements are made.
Panmure Gordon, which is regulated in the United Kingdom by the FCA, is acting solely for the Company in relation to the Placing and nobody else and will not be responsible to anyone other than the Company (whether or not a recipient of this document) for providing the protections afforded to the clients of Panmure Gordon nor for providing advice in relation to the Placing or any other matter referred to in this announcement. Apart from the responsibilities and liabilities, if any, which may be imposed upon Panmure Gordon by the Financial Services and Markets Act 2000 or the regulatory regime established thereunder, Panmure Gordon does not accept any responsibility whatsoever or make any representation or warranty, express or implied, concerning the contents of this announcement, including its accuracy, completeness or verification, or concerning any other statement made or purported to be made by it, or on its behalf, in connection with the Company, the Placing Shares or the Placing and nothing in this announcement is, or shall be relied upon as, a warranty or representation, express or implied, in this respect, whether as to the past or future. Panmure Gordon its affiliates and its and their respective directors, employees and advisers accordingly disclaim, to the fullest extent permitted by law, all and any responsibility and liability whether arising in tort, contract or otherwise (save as referred to herein) which any of them might otherwise have in respect of this announcement or any such statement.
Any indication in this announcement of the price at which Placing Shares have been bought or sold in the past cannot be relied upon as a guide to future performance. No statement in this announcement is intended to be a profit forecast and no statement in this announcement should be interpreted to mean that earnings per share of the Company for the current or future financial years would necessarily match or exceed the historical published earnings per share of the Company. The price of Placing Shares and the income from them may go down as well as up and investors may not get back the full amount invested on disposal of the Placing Shares.
The Placing Shares to be issued pursuant to the Placing will not be admitted to trading on any stock exchange other than the London Stock Exchange's main market for listed securities.
Neither the content of the Company's website (or any other website) nor any website accessible by hyperlinks to the Company's website is incorporated in, or forms part of, this announcement.
ENDS