PCF.L Regulatory News (PCF)

9 May 2006 09:12

Private & Commercial Fin Group Plc09 May 2006 PRIVATE & COMMERCIAL FINANCE GROUP PLC PROPOSED PLACING AND SHARE CAPITAL REORGANISATION The Directors of Private & Commercial Finance Group ("PCFG" or the "Company")are pleased to announce that the Company has raised £500,000 through aconditional placing of 2,777,778 new ordinary shares at 18p per share (the"Placing Shares") (the "Placing"). The Placing is conditional on the passing of resolutions to be proposed at theannual general meeting to be held on 23 May 2006 (the "AGM"). Two of theresolutions to be proposed at the AGM concern a reorganisation of the ordinaryshare capital of the Company, which is described further below. Reasons for the Placing The volume of new business underwritten by the operating subsidiaries of theCompany has been growing strongly since the second half of 2005 and has beenparticularly buoyant in 2006. In addition, the Company has a number ofopportunities to acquire portfolios of finance receivables. Consequently, theCompany requires additional equity finance to fund its organic growth andpotential acquisitions of finance receivables, provided these meet the Company'scriteria and are earnings enhancing. The Directors considered the different methods of raising the additional capitalrequired and concluded that private placing is the most beneficial toshareholders as it involves considerably less cost and time than other means. Proposed Share Capital Reorganisation The current nominal value of each ordinary share is 25p (the "Existing OrdinaryShares"). The Company is prohibited by law from issuing shares for aconsideration less than the nominal value and could not therefore issue ExistingOrdinary Shares for a consideration of less than 25p per share. The share priceis currently less than 25p and has been so since July 2005. In order to overcomethis restriction, the Company is proposing a share capital reorganisation (the"Share Capital Reorganisation"). Under the terms of the Share Capital Reorganisation, it is proposed that eachExisting Ordinary Share of 25p each and each authorised but unissued OrdinaryShare of 25p each will be divided into five new ordinary Shares with a nominalvalue of 5p each. Four of each of the five newly sub-divided ordinary shares of5p each will be re-designated as deferred shares of 5p each (the "DeferredShares"). The new ordinary shares of 5p (issued and unissued) thereby created(the "New Ordinary Shares") will have exactly the same rights (including votingand dividend rights and rights on return of capital) as the Existing OrdinaryShares (issued and unissued). The Deferred Shares created by the Share CapitalReorganisation will be non-voting, will have minimal rights and will not belisted or quoted on any recognised investment exchange. They will be effectivelyvalueless. The Company has the right to purchase all the Deferred Shares inissue for no consideration. The effect of the Share Capital Reorganisation is that each ordinary share heldby ordinary shareholders shall have a nominal value of 5p, but the number ofordinary shares held by ordinary shareholders remains the same following thesub-division. Implementation of the Share Capital Reorganisation requires the approval both ofordinary shareholders and holders of the two classes of convertible unsecuredloan notes of the Company. In addition to the AGM, separate meetings of eachclass of loan note holders will also be held on 23 May 2006. On completion of the Share Capital Reorganisation, new share certificates willbe issued. Application will be made for the New Ordinary Shares, including the 2,777,778Placing Shares, to be admitted to AIM. Subject to the passing of the necessaryresolutions at the general meetings of loan note holders and at the AGM, it isexpected that admission of the New Ordinary Shares will take place on 24 May2006. Enquiries: Private & Commercial Finance Group plc 020 7222 2426Tony Nelson Westhouse Securities LLP 0161 838 9140Tim Feather Notes to Editors: Private & Commercial Finance Group plc, which is authorised and regulated by theFinancial Services Authority, is an independent AIM-listed finance house.Through its operating subsidiaries the Company provides a carefully selectedrange of equipment finance products tailored for both business and personalcustomers. The range extends from financing cars for consumers to leasing a widerange of equipment to businesses. This information is provided by RNS The company news service from the London Stock Exchange