STP.L Regulatory News (STP)

19 Jul 2006 12:13

Spiritel PLC19 July 2006 For immediate release 19 July 2006 SPIRITEL PLC ("Spiritel" or "the Company") Restructuring of Redeemable Preference Shares and Loan Notes Spiritel plc (AIM: STP), the telecommunications services business, is pleased toannounce that it has agreed in principle with Penta Capital Partners Limited, asthe investment manager of Penta Fund 1 Limited Partnership and Penta Fund 1 SPLimited Partnership (together "Penta"), the holders of the Company's redeemablepreference shares and the Company's outstanding loan notes, to modify the termsattaching to the redeemable preference shares and loan notes. A total of £4.1 million of redeemable preference shares are currentlyoutstanding. Spiritel will seek shareholder approval at an extraordinary generalmeeting (the "EGM") to amend the Company's Articles in order that the redeemablepreference shares become convertible into ordinary shares of 1p each, with up to£1,000,000 nominal value of the redeemable preference shares capable of beingconverted at a price of 2.5p per ordinary share and any further conversion beingeffected at the higher of 4.25p per ordinary share and a price per share of 20per cent. below the then current middle market price. The Articles will be further modified to remove Penta's right to any fixeddividend in respect of the redeemable preference shares, which currently carryan 8% coupon. Upon redemption or conversion of the redeemable preference shares,the Company will pay to Penta a redemption premium of 25% of the amount redeemedor converted. This premium may be converted into ordinary shares at the sameprice used to convert the redeemable preference shares to which the premiumapplies. Penta is currently interested in approximately 23.8 per cent. of the issuedordinary share capital of the Company. If Penta were to convert the preferenceshares on the terms of the proposal described above (the "Proposal"), it wouldtrigger a mandatory offer for the Company under the Takeover Code.Implementation of the Proposal will therefore be conditional on the grant of awaiver by the Panel on Takeovers and Mergers ("Panel") from the obligation thatmight otherwise arise for Penta to make a mandatory offer for all of theCompany's ordinary shares not already owned by Penta (a "Code Whitewash"). Thegrant of a Code Whitewash by the Panel will require, inter alia, the approval ofthe Proposal by independent shareholders at the EGM. It is also proposed that the Company will pay to Penta a redemption premium of35% of the nominal amount of any loan notes redeemed. Loan notes of £500,000 arecurrently outstanding. Conditional upon shareholder approval of the proposedchanges to the Company's Articles, Penta has also waived its right to intereston the loan notes with effect from 1 May 2005. Alastair Mills, Spiritel's Chief Executive, commented: "I am delighted by thisdebt restructuring which both strengthens our balance sheet and, given theconvertible element to the restructuring, highlights Penta's confidence in theprospects for the Company's shares as the migration from fixed line to VoIPtelephony gains pace." For further information: Spiritel plc 020 7160 0100Alastair Mills, Chief Executive Teather & Greenwood 020 7426 9000Jeff Keating Buchanan Communications 020 7466 5000Mark CourtMary-Jane Johnson Notes for Editors: About Spiritel plc Spiritel plc (AIM: STP) is a telecommunications services and products companythat joined the AIM market of the London Stock Exchange in July 2004. Itsservices include call termination and in addition it has developed a suite ofleading-edge VoIP products, positioning the Company to benefit from themigration from traditional telephony to VoIP services. For further information please visit www.spiritelplc.com This information is provided by RNS The company news service from the London Stock Exchange