4 Jul 2012 15:00
Longships plc
("Longships" or the "Company")
Proposed Subscription for Ordinary Shares and Subscription Shares in
Praetorian Resources Limited
Proposed Return of Capital to Shareholders and B Share Scheme
General Meeting
Longships is pleased to announce that it has entered into a conditional agreement to subscribe £2,308,100 in cash for ordinary shares and subscription shares in the capital of Praetorian Resources Limited ("Praetorian Resources"), a Guernsey-incorporated investment company established by a team of experienced resource and investment professionals (including Malcolm Burne and Charles Cannon-Brookes) to build a focused natural resources resource investment portfolio in order to generate positive returns to shareholders. Completion of the agreement is conditional upon admission of all the issued and to be issued ordinary shares and subscription shares in Praetorian Resources to trading on AIM (anticipated to take place at 8:00 a.m. on 9 July 2012) and approval of the agreement by the independent Shareholders of the Company at a general meeting of the Company to be convened for the purpose (the "General Meeting").
Longships is also proposing, following completion of its subscription for ordinary shares and subscription shares in Praetorian Resources, to transfer to Shareholders all of its holding of such shares in Praetorian Resources. The Company intends to effect this return of capital through a structure involving an issue of B Shares which will then (subject to approval of the High Court) be cancelled by the Company in consideration for the Company transferring to Shareholders all its holding of ordinary shares and subscription shares in Praetorian Resources. This structure is intended to enable all Shareholders, subject to applicable overseas restrictions and tax laws, to receive the ordinary shares and subscription shares in Praetorian Resources as a return of capital.
Circular and General Meeting
A circular containing a letter from Nathan Steinberg, the independent director of the Company, explaining the Company's rationale for the subscription for shares in Praetorian Resources and the return of capital to Shareholders and setting out full details of the timing and terms of the transaction will be posted to Shareholders shortly whereupon it will be available on the Company's website at www.longshipsplc.com.
The circular will also contain full details and the notice of the General Meeting, which is to be convened to take place at 10:00 a.m. on Friday, 27 July 2012 at the offices of the Company's solicitors, Lawrence Graham LLP, 4 More London Riverside, London SE1 2AU.
About Praetorian Resources
Praetorian Resources is a natural resources focused investment company that was founded by Richard Lockwood, who was until recently the senior resource fund manager at CQS Asset Management Ltd and who has assembled an experienced board of directors including Malcolm Burne (ex-Executive Chairman of Golden Prospect plc), Andrew Ferguson (Chief Executive Officer of APAC Resources), Mark Hohnen (ex-Executive Chairman of Kalahari Minerals plc) and Robert King. Richard Lockwood, Malcolm Burne and Charles Cannon-Brookes will form the advisory and execution team of Praetorian Resources and will assist its board of directors with its investment decisions and execution.
Praetorian Resources is due to be admitted to trading on AIM on 9 July 2012 and has published an AIM Admission document dated 4 July 2012. Praetorian Resources has raised a total of £9,322,510 in cash and acquired an aggregate of £14,001,933 in other quoted companies through share exchange agreements with certain investors and fund managers, all conditional upon Praetorian Resources' admission to AIM taking place. The Company has entered into the agreement with Praetorian Resources to invest £2,308,100 in cash for 4,616,200 new ordinary shares in Praetorian Resources at £0.50 per ordinary share (with 2,308,100 new subscription shares in Praetorian Resources attached), conditional upon not only Praetorian Resources' admission to AIM taking place, but also the approval of Shareholders of the subscription. Subject to the approval of Shareholders, completion of the Company's investment in Praetorian Resources will therefore not take place until after the General Meeting.
The Company did not consider it appropriate to invest all of its cash in Praetorian Resources. Following completion of the investment in Praetorian Resources and the return of capital, the Company's remaining assets will comprise approximately £550,000 in cash. The Company intends to maintain the admission of its ordinary Shares to trading on AIM following completion of the subscription and look for suitable opportunities for further investment by the Company.
Further information on Praetorian Resources Limited, including its AIM Admission document, is available on Praetorian Resources' website www.praetorianresources.com.
Shareholder Approval of Investment in Praetorian Resources
The board of directors of the Company is of the view, after consultation with the Company's nominated adviser, Westhouse Securities Limited, that completion of the agreement for the subscription for shares in Praetorian Resources is a related party transaction under AIM Rule 13 and should be conditional on, inter alia, the approval of the independent Shareholders of the Company in light of the fact that Malcolm Burne, Charles Cannon-Brookes and Richard Lockwood, who are all significant shareholders in the Company, will also be shareholders in, and are members of the advisory and execution team to the board of, Praetorian Resources and that both Malcolm Burne and Richard Lockwood are also directors of Praetorian Resources.
Accordingly, a formal resolution is proposed to be put to the shareholders of the Company as an ordinary resolution at the General Meeting to approve completion of the subscription by the Company for ordinary shares and subscription shares in Praetorian Resources. Malcolm Burne, Charles Cannon-Brookes and Richard Lockwood have agreed that neither they nor their nominees, who hold an aggregate holding of representing 21.26% of the issued share capital of the Company, will vote on such resolution.
Nathan Steinberg, being an independent director of the Company, has consulted with the Company's Nominated Adviser, Westhouse Securities Limited, and considers the terms of the subscription by the Company for ordinary shares and subscription shares in Praetorian Resources to be fair and reasonable in so far as Shareholders are concerned.
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Enquiries:
Longships plc
Nathan Steinberg - Director Tel: 020 7845 7500
Westhouse Securities Limited
Richard Baty / Petre Norton Tel: 020 601 6100