RAM.L Regulatory News (RAM)

13 Nov 2008 07:00



13 November 2008

RAM INVESTMENT GROUP PLC

("RAM" or the "Company")

Subscription and Board Changes

Intended disposal 

Introduction 

The Company announces that it has raised £50,000 of new capital (before expenses) (the "Placing") and has made changes to the Board to facilitate the proposed extension of its investing strategy. The Company also intends to dispose of the 33,196,000 ordinary shares of 0.01p ("Ordinary Shares") each held in Parallel Media Group Plc ("PMG") to current and previous Directors of RAM, being Messrs Edward Adams, Laurence Selman and Nicholas Lebetkin (the "Directors"), in consideration of the extinguishment of the principal amount and all accrued interest (as at the end of May 2007 being some £41,418) under the £375,000 loan facility agreement dated 31 December 2006. Their disposal will constitute both a fundamental disposal under AIM Rule 15 requiring shareholder approval and a related party transaction under AIM Rule 13. As a result, the Company will become an "investing company" under the AIM Rules and will have 12 months to implement its investing strategy, as set out below. These arrangements are subject to agreement and when they are agreed a further announcement will be made and a Circular issued to Shareholders in accordance with the AIM Rules. The Company is also in the process of raising further funds as part of the Placing and hopes to announce this shortly, once completed.

The Placing 

The Company has placed 1,250,000 new ordinary shares of 1p each at a price of 4p per share to raise £50,000 before expenses, with an institutional investor on behalf of clients. The new Ordinary Shares will, when issued, rank pari passu with the existing Ordinary Shares in issue and application will be made for such new Ordinary Shares to be admitted to trading on AIM. This is expected to be on 19 November 2008. The proceeds of this issue, after expenses, will be used for the working capital requirements of the Company. It is the intention that further funds will be raised on a similar basis to support the Company's intended extended investing strategy.

Mark Callaway is the beneficiary of the Anfa Trust which has subscribed for 250,000 new Ordinary Shares representing a 3.61% of the then issued share capital as part of the Placing.

Tim Baldwin is a director and controlling shareholder in Hill Street Investments. Hill Street Investments purchased 286,000 existing Ordinary Shares through the purchase of fractional entitlement shares. A further 250,000 new Ordinary Shares were purchased by Hill Street Investment at 4p as part of the Placing. In addition a further 750,000 new Ordinary Shares were purchased on behalf of Tim Baldwin's SIPP. Tim Baldwin's beneficial holding, following the Placing, will be 1,286,000 Ordinary Shares representing a 18.56% of the then issued share capital.

Board Changes

In contemplation of the change of strategy, the Company has accepted the resignation of Laurence Selman and Nicholas Lebetkin with immediate effect and thanks them for their past endeavours on behalf of the Group. Edward Adams continues as non-executive Director and is joined by the immediate appointment of Tim Baldwin as executive Chairman and Mark Callaway as Finance Director. Further Directors may be appointed to the Board as and when the Company considers it appropriate.

Timothy ("Tim") Edward Baldwin, aged 44 (Executive Chairman)

A highly experienced financier in the UK, with a successful 20 year career in the London financial markets. Tim has been responsible for the flotation, acquisition and fund raising for a range of companies within many sectors of the UK quoted market and has specialist knowledge of the oil and gas sector. His career includes Head of Smaller Companies Research and Director of Institutional Stock-broking at Greig Middleton and institutional salesman/corporate broker at both Investec Securities and Canaccord Capital.

Tim Baldwin has held the following directorships in companies or partnerships in the past five years:

Other than the participation in the Placing and the purchase of Ordinary Shares through the purchase of the fractional entitlement as referred to above, Tim Baldwin has no shareholding in the Company and has no options. 

Mark Callaway, aged 56 (Finance Director)

Mark has a long track record in oil and gas including a 25 year international career with Shell, where he was the Chief Financial Officer for the Kazakhstan Caspian Sea Discovery, Kashagan. Subsequently he was a Vice President with Nelson Resources in Kazakhstan, and CFO of FirstAfrica Oil Plc in London and more recently has been CFO and Director of Elko Energy Inc, a private Canadian company.

Mark Callaway has held the following directorships in companies or partnerships in the past five years:

Other than the participation in the Placing as referred to above, Mark Callaway has no shareholding in the Company and has no options. 

There are no further details in relation to the above appointments which require disclosure under paragraph (g) (iii) to (viii) of Schedule 2 to the AIM Rules.

Intended disposal of the investment in PMG

The Company currently owns 33,196,000 ordinary shares of 0.01p each in PMG which were acquired on 3 October 2006 in order to further the Company's strategy of making media and leisure investments. This investment is currently valued at some £66,400. On 31 December 2006, Allied Trust Company Limited, Nicholas Lebetkin and Laurence Selman were granted a debenture for the £375,000 loan facility to the Company, which has been drawn down in full for the purposes of financing this investment. In addition, the Company's wholly owned subsidiary RAM Media Limited has won a legal case as announced on 13 August 2008, currently subject to appeal, and will establish what monies will come back to the Group if the appeal is unsuccessful.

In order to dispose of the Company's remaining media interest and to remove the Company's secured indebtedness (including all accrued interest) under the £375,000 loan facility agreement from the balance sheet, the Company intends, subject to shareholder approval in compliance with the AIM Rules and the Companies Act, to undertake the following:

1) Distribution/transfer of the 33,196,000 ordinary shares held in PGM, in the following percentages: Nicholas Lebetkin and Laurence Selman 46.6% each and Edward Adams 6.8%.

2) In the event that RAM recovers monies from the claim against the Greek Ministry of Culture through RAM Media (either by way of its creditors claim on RAM Media or recovery of its costs) the first £94,000 will be retained by RAM. Thereafter, any such monies will be distributed as follows: Nicholas Lebetkin, Laurence Selman and Edward Adams 30% each and Iain Manley (Company Secretary) 10%, with a maximum distribution of £100,000. These figures exclude the £7,500 disbursement to be paid by RPC directly to Adams & Manley for consultancy services rendered during the case.

3) The Company will be devising a new share option scheme and options over 10% of the enlarged issued share capital will be issued and divided as follows: Nicholas Lebetkin, Laurence Selman and Edward Adams 30% each and Iain Manley 10%. The enlarged issued share capital will be based on that outstanding prior to the issue of the circular to shareholders seeking approval for a reverse transaction under AIM Rule 14 ("RTO") in due course. The options should have a minimum life of 3 years and the exercise price should be the same as the RTO share consideration and/or equity fundraising per share at the date of that transaction.

All three existing Directors, being Messrs Edward Adams, Laurence Selman and Nicholas Lebetkin who are 17.61%, 26.95% and 26.95% current shareholders (prior to the Placing) in the Company respectively, are related parties for the purposes of the AIM Rules. The arrangements set out above have not yet been formalised but when they are a further announcement will be made dealing with these arrangements in accordance with the requirements of AIM Rules 13 and 15. A circular, dealing with these requirements and also a proposed extension of the Group's investment strategy will be sent to shareholders shortly.

Other Matters

The Company is due to post its Accounts for the year ended 31 May 2008 to shareholders by 30 November 2008.

Following the placing of 1,250,000 new Ordinary Shares referred to above, there will be 6,927,900 Ordinary Shares in issue. 

Contact:

Edward Adams, RAM Investment Group plc on 07967 008448

Tim Baldwin, RAM Investment Group plc on 0207 518 4303

Roland Cornish, Beaumont Cornish Limited on 020 7628 3396