Last checked at 26 Sep 2011 07:00
Flying Brands Limited (the "Company")
Proposed sale of certain non-core property assets
The Board is pleased to announce that terms have been agreed to sell a part of our premises at Retreat Farm (the "Property") to JAJ Properties Limited ("JAJ Properties") a Jersey-based property developer. The Property has a current book value of £0.4m and consists of unutilised office space and employee accommodation which do not generate any profit for the Company. The Property is surplus to the requirements of the Company and incidental to the activities of the business and the proposed sale will not in any way affect our growing and dispatch operation that is carried out from nearby but separate properties.
The consideration agreed is £2.1m to be satisfied in cash at completion plus 10% of any eventual development profits.
The purchase agreement is conditional upon completion of normal Jersey conveyancing formalities but is not conditional upon receipt of planning permission for development of the Property. JAJ Properties has paid a deposit of £500,000 that is refundable only in the event of the conditions not being satisfied.
Jonathan Ruff, a substantial shareholder of JAJ Properties, is a related party as a result of his position as a director of Dealtastic Holdings Limited, a subsidiary of the Company, from 22 October 2010 to 18 January 2011.
The sale is a Class 1 transaction and therefore subject to shareholder approval under the Listing Rules. A circular containing details of the transaction and a notice of extraordinary general meeting will be sent to shareholders in due course with the aim of completing the sale as early as possible in November 2011.
We intend to use part of the proceeds to pay off our existing term loan from our bank of £1.7m and the remainder for general working capital purposes. We expect our existing overdraft facility with our bank to remain in place.
The proposed sale and repayment of our term loan would significantly improve our balance sheet. We continue to explore ways of maximizing the value of our remaining property assets.
For further information, please contact:
Flying Brands Limited 01245 228 300
Stephen Cook, Chief Executive
Anthony Gee, Finance Director
Smithfield Consultants 020 7360 4900John Kiely