REG.L Regulatory News (REG)

28 April 2009

Regent Inns plc

Proposed De-Listing of Ordinary Shares from the Official List

Interim Management Statement

The Board of directors of Regent Inns plc ("Regent" or "the Company"), the operator of UK late-night, entertainment-led venues and restaurants, has today posted a circular to shareholders of the Company ("the Circular") regarding a proposed cancellation of the listing of the Company's ordinary shares on the Official List and the trading in its ordinary shares on the London Stock Exchange's market for listed securities ("the De-Listing") and other related matters. A general meeting of the Company ("the General Meeting") will be held at the offices of the Company's solicitors, Lawrence Graham LLP, 4 More London Riverside, London SE1 2AU on Thursday, 14 May 2009 at 10.00 am at which a special resolution will be proposed to approve the De-Listing (and consequential amendments to the Company's articles of association) ("the Resolution").

The directors of the Company ("the Directors" or "the Board") and certain of its shareholders have irrevocably undertaken to vote in favour of the Resolution in respect of all ordinary shares of 5p each in the Company ("Ordinary Shares") which they beneficially own, amounting to in aggregate 53,063,774 Ordinary Shares (representing approximately 46.81% of the issued Ordinary Shares in the Company).

In addition, Regent announces its interim management statement for the period from 28 December 2008 to date, as required by the UK Listing Authority's Disclosure and Transparency Rules.

Trading in the first 8 weeks of the reporting period was commented on in the half year results for the 26 weeks ended 27 December 2008 announced on 27 February 2009.

Key points relating to that 8 weeks trading period were:

like-for-like sales down 11.7% on last year

the Company is cautious about the future and continues to find market conditions very challenging 

Subsequent to 27 February 2009, like-for-like sales trends have not materially changed, resulting in like-for-like sales since 28 December 2008 being down 11.4%.

The key points of the Circular in respect of the De-Listing are summarised below.

Background to, Reasons for and Information on the De-Listing

The share price of the Ordinary Shares and the resulting market capitalisation of the Company have been at very low levels relative to the past for some time and demand for shares has been extremely limited. The Company's market capitalisation is now a small fraction of its net debt. 

The costs associated with a listing on the Official List are now very significant in relation to the Company's operating profit and market capitalisation. 

The principal issue in relation to being listed on the Official List is that the specific requirements in respect of transactions that are significant in relation to the Company’s market capitalisation are now particularly onerous and restrictive in the view  of the directors of the Company ("the Directors" or "the Board"). In line with its strategy, the Company is currently in discussions in respect of a number of disposals, including some individual site disposals, which, under the Listing Rules, will require a circular to shareholders and the approval of shareholders before they can be completed. No waiver or relaxation of these requirements is available. If the Ordinary Shares were to remain listed on the Official List, the level of disclosure and related costs, which are considerable and disproportionate to the size of these transactions in terms of assets and consideration in the Board's view, may preclude them from being satisfactorily and economically concluded.

The Directors estimate the compliance, administration and legal costs associated with the Company's listing on the Official List, excluding costs associated with significant transactions, to be in excess of £200,000 per annum. They expect that the majority of these costs will no longer be incurred following the De-Listing.

The Board has been in discussions with its advisers in respect of the above factors and has concluded that a listing on the Official List is too onerous for Regent Inns and that it is no longer in the best interests of the shareholders of the Company. On this basis, the Directors consider that it would be in the best interests of the Company to seek the cancellation of the admission of the Company's Ordinary Shares to the Official List.

Under the Listing Rules, it is a requirement that cancellation of admission to the Official List must be approved by not less than 75 per cent. of the holders of Ordinary Shares (being entitled to do so) voting in person or by proxy.

Strategy following the De-Listing

Following the De-Listing, the Board intends to operate the Company's business in the same manner and with the same objectives as were set out in the 2008 Report and Accounts. The Board's medium term objectives remain firstly the maximisation of cash flow from existing operations and the reduction of debt whilst maintaining the integrity of the Group's brands and secondly the stabilisation of sales in Walkabout.

Reporting and Disclosure

In addition to publishing annual accounts, it is the Board's intention following the De-Listing to keep shareholders informed of the Company's financial position through the publication of a statement in respect of the Company's performance for the first six months of each financial year and the publication of details of transactions that are, in the view of the Board, material to the Company.

Corporate Governance

Following the De-Listing, it is the Board's intention to continue to operate Audit and Remuneration Committees chaired in each case by an independent Director. The Executive Directors and the Non-Executive Directors all intend to continue serving the Company and to continue leading its direction.

Effects of the De-Listing and Transactions in the Ordinary Shares following the De-Listing

The principal effect of the De-Listing is that shareholders of the Company will no longer be able to buy and sell shares in the Company through a public stock market. Additional effects of the De-Listing are set out in the Circular.

Ordinary Shares will remain freely transferable and will continue to be transferable through CREST.

In addition, in order to provide potential liquidity in the Company's shares after the De-Listing, the Company intends to set up and maintain a 'matched bargain' settlement facility. Under this facility, shareholders or persons wishing to acquire shares will be able to leave an indication with the facility provider that they are prepared to buy or sell at an agreed price. In the event that the facility provider is able to match that order with an opposite sell or buy instruction, the facility provider will contact both parties and then effect the order. Shareholders who do not have their own broker may need to register with the facility provider as a new client. This can take some time to process and therefore shareholders who consider they are likely to avail themselves of this facility are encouraged to register at the earliest opportunity. The contact details of the 'matched bargain' settlement facility provider, once arranged, will be made available to shareholders on the Company's website.

City Code on Takeovers and Mergers

Shareholders should note that following the De-Listing, the City Code on Takeovers and Mergers ("the Takeover Code") will continue to apply to the Company for 10 years from the De-Listing becoming effective in accordance with paragraph 3(a)(iii)(A) of the 'Introduction' section of the Takeover Code.

Recommendation

The Board, having consulted with the Company's financial advisers, The Delphi Partnership LLP, considers the De-Listing and the proposed amendments to the Company's articles of association to be in the best interests of the shareholders of the Company as a whole. The Board is unanimously in favour of the Resolution to be proposed at the General Meeting. Accordingly, the Board unanimously recommends shareholders to vote in favour of the Resolution to be proposed at the General Meeting, as all the Directors have irrevocably undertaken to do in respect of their own beneficial shareholdings of, in aggregate, 1,320,793 ordinary shares (representing 1.16% of the current issued ordinary share capital of the Company). 

The Delphi Partnership LLP is an appointed representative of Capital Markets Strategy Limited which is authorised by the Financial Services Authority.

Commenting on the proposal, Jim Glover, Non-Executive Chairman of Regent, said:-

"The private company arena is now the most practical one for Regent and will provide a more suitable environment in which to manage the Company.

After much consideration, the Board now regards the De-Listing to be in the best interests of the shareholders of Regent as a whole. It is recommending this course of action to shareholders accordingly."

If the resolution is approved by shareholders of the Company, it is expected that the De-Listing will take effect at 8.00 am on 15 June 2009.

- Ends -

Enquiries: 

Regent Inns plc +44 (0) 20 8327 2540

Jim Glover, Chairman

John Leslie, CEO

Merlin PR +44 (0)20 7653 6620

Paul Downes +44 (0) 7900 244888

Vanessa Maydon + 44 (0) 7802 961 902

Rachel Thomas +44 (0) 7787 504447