Plexus Regulatory News (POS)

Plexus Holdings PLC / Index: AIM / Epic: POS / Sector: Oil equipment & services

17 January 2011

Plexus Holdings PLC ('Plexus' or 'the Company')

£6.2 Million Placing of New and Existing Ordinary Shares

Plexus Holdings PLC, the AIM quoted oil and gas engineering services business and owner of the proprietary POS-GRIP® friction-grip method of wellhead engineering, is pleased to announce that it has conducted a placing of 7,950,628 new and existing ordinary shares of 1 penny each at a price of 78p per share, with an aggregate value of approximately £6.2 million before expenses.  This placing comprises 2,564,103 new ordinary shares ('New Ordinary Shares') of 1 penny each which are being issued by the Company to raise £2 million of new money before expenses. In addition, conditional on admission of the New Ordinary Shares to trading on AIM, certain existing shareholders of the Company as detailed below have sold 5,386,525 existing ordinary shares ('Existing Ordinary Shares') of 1 penny each to meet demand from new and existing institutional investors (the placing of New Ordinary Shares and Existing Ordinary Shares being collectively referred to as 'the Placing'). The Company's Nomad and Broker, Cenkos Securities plc, conducted the Placing.

Plexus' Chairman Robert Adair has notified the Company that he will be retiring as a Director and Chairman with effect from no later than 30 June 2012, and is therefore now selling his interests in Plexus totalling 3,505,425 Existing Ordinary Shares as part of the Placing. This should assist to improve liquidity in the Company's shares and help to meet institutional demand. The Board would like to take this opportunity to thank Mr. Adair for his contribution to Plexus over the past six years since its admission to AIM and wish him well for the future. Shareholders should note that the process to select and appoint a new Chairman is underway and the Board expects to announce further details in due course.

Plexus intends to use the net proceeds of the Placing of the New Ordinary Shares to support the Company's growth strategy, which remains focused on expanding both the international reach and application of its innovative POS-GRIP friction-grip wellhead technology, known for its superior safety, time and cost saving attributes. Specifically, the net proceeds raised for the Company will be used to finance its Joint Industry Project ('JIP') "HGSS" subsea wellhead design initiative to develop and commercialise a new and safer subsea wellhead utilising POS-GRIP technology in conjunction with various JIP consulting partners including Shell, Maersk, Tullow and Wintershall.

The funds raised through the Placing of New Ordinary Shares will also assist Plexus to progress the ongoing implementation of other product and growth initiatives over the next three years. The Company's existing working capital will be used to:

·; Complete the up to 20,000 psi high pressure/ high temperature ('HP/HT') Mudline Tieback project to enable, for the first time, HP/HT exploration wells to be converted into subsea or platform producing wells, with commercialisation targeted for 2012;

·; Increase the Company's rental POS-GRIP wellhead equipment inventory and look to establish an additional service base to serve international markets;

·; Potentially extend the range of POS-GRIP technology applications to diverse new product applications such as valves, connectors, tanker mooring systems, CO2 storage, geothermal and fracking; and

·; Invest further in personnel and infrastructure to support the Company's commercial activities.

Ben van Bilderbeek, CEO of Plexus said, "The highly positive response to the over-subscribed Placing emphasises the investment community's growing confidence in Plexus' ability to become a leading specialist oil and gas wellhead services company. Acceptance of our proprietary patented friction-grip wellhead technology by leading industry participants, illustrated by recent significant contract awards, highlights the increasingly real prospect for POS-GRIP to become a new wellhead standard and a wellhead technology of choice thanks to superior technical performance, installation time savings, reduced operating costs and enhanced safety, particularly for HP/HT applications.

"We have identified a number of new initiatives and product development opportunities that we believe will aid the roll out and adoption of our POS-GRIP technology by multinational oil and gas operators, expand our product offering to include more diverse applications and in turn fuel Plexus' growth. Such initiatives include our JIP with partners that include Shell, Maersk, Tullow and Wintershall to design, develop and commercialise a new method of subsea wellhead engineering to improve safety and performance standards; and our up to 20,000 psi HP/HT Mudline Tieback project to allow exploration wellheads to be converted for use in production drilling, which has just received £260,000 of development and testing funding from Maersk Oil North Sea UK Limited.

"Following our recent breakthrough Licensing, Manufacturing, Distribution, and Agency Agreement with worldwide supplier Breda Energia S.p.A for the exclusive supply of POS-GRIP equipment to ENI S.p.A anywhere in the world, we will continue to seek additional commercial licensing and joint venture opportunities to support our international expansion. We also are looking at the benefits of establishing additional service bases in key markets around the world to support our growth strategy.

"Finally and significantly, the Placing has broadened the Company's institutional shareholder base and brought in a number of new blue chip investors. We anticipate that this in turn will help improve the liquidity in our shares going forward. We warmly welcome our new institutional shareholders and, at the same time, I would like to thank our existing shareholders for their continued support at what promises to be an exciting time for Plexus."

Details of the Placing

As part of the Placing of the 2,564,103 New Ordinary Shares by Plexus, the following existing shareholders of the Company have also agreed to sell 5,386,525 Existing Ordinary Shares at the Placing Price, inter alia, to meet institutional demand and improve liquidity:

o Skye Investments Limited (*Robert Adair's interest is noted below) has agreed to sell 1,966,925 Existing Ordinary Shares pursuant to the Placing;

o The Trustees of the Miss CM Adair 1984 Discretionary Settlement (*Robert Adair's interest is noted below) have agreed to sell 1,538,500 Existing Ordinary Shares pursuant to the Placing;

o Mutual Holdings Limited (**Ben van Bilderbeek and Jeff Thrall's interests are noted below) has agreed to sell 1,300,000 Existing Ordinary Shares pursuant to the Placing; and

o The wider van Bilderbeek family interests have also agreed to sell 581,100 Existing Ordinary Shares pursuant to the Placing.

Following the Placing, Mr Adair will have no further interest in the Company's ordinary shares of 1 penny each ('Ordinary Shares') and the directors' beneficial interests are as follows:

* Robert Adair, Director, is interested by way of being life tenant of a settlement of which he is a trustee and as a director of Skye Investments Limited.

** Ben van Bilderbeek, Director, is one of the beneficiaries of a trust which controls 70.875% of the shares of Mutual Holdings Limited. Jeffrey Thrall, Director ,in addition to his own beneficial interest of 700,000 ordinary shares held by Thrall Enterprises, has an indirect beneficial interest in a company which controls 23.625% of Mutual Holdings Limited.

Application has been made for theNew Ordinary Shares to be admitted to trading on AIM and it is expected that dealings will commence on 23 January 2012.

Following Admission, Plexus will have 82,746,672 Ordinary Shares in issue and each share has the right to one vote. Therefore, for the purposes of the Financial Services Authority ('FSA') Disclosure and Transparency Rules, the total number of voting rights in the Company is 82,746,672. The above figure may be used by shareholders as the denominator for the calculations by which they will determine whether they are required to notify the Company of their interests in, or change to their interests in, Plexus Holdings PLC under the FSA's Disclosure and Transparency Rules.

The Placing has only been made to persons (i) falling within the description of persons that, if they were clients of Cenkos Securities PLC, could be categorised as a "professional client" or an "eligible counterparty" within the meaning of Chapter 3 of the FSA's Conduct of Business Sourcebook, (ii) of a kind described in paragraph 5 of Article 19 or paragraph 2 of Article 49 of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (as amended), and (iii) who fall within the provisions of Article 2.1(e)(i) of the Prospectus Directive and no other person may now participate in the Placing or rely on any communication relating to it.

**ENDS**

For further information please visit www.posgrip.com or contact:

Notes to Editors:

Plexus Holdings PLC, which began trading on AIM in December 2005, is an oil and gas engineering and services business, which supplies wellhead and mudline suspension equipment for exploration and production applications. Based in Aberdeen, with offices in London, Cairo, Kuala Lumpur and a presence in Houston, Texas, it has developed and patented a friction-grip method of engineering for oil and gas field wellheads and connectors, POS-GRIP®, which involves deforming one tubular member against another to effect gripping and sealing. 

The Company plans to accelerate the roll out of POS-GRIP wellhead equipment as a superior alternative to current technology and for it to become the future industry standard for wellhead design. In particular, the technology has advantages in High Pressure/High Temperature (HP/HT) and Extreme HP/HT (X-HP/HT) oil and gas environments, for which there is growing global demand and where Plexus is being increasingly recognised as the supplier of choice. Importantly, the Company is focussed on extending its proprietary technology into an increasing number of subsea applications. In line with this, in March 2011 the Company launched an initiative to develop a new subsea wellhead design, HGSS™, utilising its friction-grip technology in collaboration with key oil and gas operators and service companies. Royal Dutch Shell, Wintershall, Maersk, Tullow Oil and the UK entity of the world's largest offshore drilling company have joined the initiative to date. The HGSS subsea wellhead design will include a combination of key features never before seen in a subsea wellhead which include being rated to 15,000 psi, 4,000,000 pounds of 'instant' casing lockdown capacity, annulus pressure monitoring and access for 'bleed off' capability to address sustained casing pressure ('SCP') issues which are recognised by the API as a serious industry problem, and rigid metal annular seal technology qualified to match the performance of premium casing.  Development is expected to be completed by mid 2013 calender year.

To date, POS-GRIP wellhead systems have been used or selected to be used in over 150 oil and gas wells by international companies including Apache Energy Australia, BHP Billiton, BG International, Bowleven plc, BP, Brunei Shell Petroleum, Cairn Energy, Centrica, ConocoPhillips, Dana Petroleum, Dubai Petroleum, GDF SUEZ, Global Santa Fe, Maersk, Niko Resources, Petro-Canada Trinidad & Tobago, Red Sea Petroleum Operating Company, Repsol, RWE, Senergy Limited, Shell Egypt, StatoilHydro, Silverstone Energy, Talisman Energy, Tullow Oil, and Wintershall.