Sutton Harbour Holdings Regulatory News (SUH)

Sutton Harbour Holdings plc (the "Company" and "the Group")

Placing and Open Offer of 33,333,334 new ordinary shares of 1 pence each ("New Ordinary Shares") at 18 pence each

23 December 2011

Introduction

The Company announces today that it proposes to raise approximately £6.0 million (before expenses) by way of a placing of 11,932,459 New Ordinary Shares and an open offer of 21,400,875 New Ordinary Shares on the basis of 17 New Ordinary Shares for every 50 existing ordinary shares of 25 pence each ("Existing Ordinary Shares") at 18 pence per New Ordinary Share ("Placing and Open Offer").

The terms of the Placing and Open Offer are described in a circular dated 23 December 2011 which is being posted to shareholders today ("the Circular"). The net proceeds of the Placing and Open Offer are expected to be approximately £5.7 million.

Application will be made to the London Stock Exchange for the New Ordinary Shares subscribed in the Placing and Open Offer to be admitted to trading on AIM ("Admission"). It is expected that Admission will become effective and that dealings will commence on 18 January 2012.

Terms of the Open Offer

Existing shareholders are being invited to apply for New Ordinary Shares pro rata to their existing shareholdings on the basis of 17 New Ordinary Shares for every 50 existing ordinary shares of 25 pence each ("Existing Ordinary Shares") held as at the record date, being 5 p.m. on 21 December 2011, under the Open Offer at a price of 18 pence per New Ordinary, payable in full on application and free of all expenses.

The Open Offer will allow the Company's existing Shareholders to participate in the fundraising and the terms of the Placing and Open Offer are described in the Circular. The Placing and Open Offer are conditional, inter alia, upon approval by shareholders and admission of the New Ordinary Shares to trading on AIM of the London Stock Exchange.

Any New Ordinary Shares not taken up by shareholders will be subscribed for by certain investors.

In addition to the Placing and Open Offer, there will be a capital reorganisation in order to reduce the nominal value of the Existing Ordinary Shares.

The General Meeting to approve the resolutions will be held at the Holiday Inn, Armada Way, Plymouth, Devon, PL1 2HJ on 17 January 2012 at 12.00 p.m.

Use of Proceeds

The net proceeds of the Placing and Open Offer are expected to be approximately £5.7 million. The proceeds will be used to fund significantly the development costs of its Millbay Marina project in Plymouth and pay down some of the Company's debt.

The Directors believe that the Placing and Open Offer is the most equitable method to allow as many shareholders to participate in the Company's future as possible.

Millbay Marina Project

The Millbay Marina project is a proposed development in the historic Brunel Dock, a central location in Plymouth with direct views across Plymouth Sound, which will provide berthing for up to 179 berths together with 2,000 sq ft of shoreside facilities. The scheme received the local authority's resolution to grant planning permission on 15 December 2011.

Capital Reorganisation - Subdivision of Existing Ordinary Shares

In order to enable equity capital to be raised, it is necessary to sub-divide the Company's share capital to ensure shares can be subscribed for above their nominal value. Accordingly, there will be a subdivision of the Existing Ordinary Shares into 1 New Ordinary Share and 1 deferred share of 24 pence each ("Deferred Share"). The Deferred Shares will have rights such that in practical terms they will have no value and will not be quoted. The Board intends to cancel the Deferred Shares in due course.

Related Party Transactions under the Placing and the Open Offer

Rotolok Limited ("Rotolok"), which is a company associated with Mr. Dan McCauley, has irrevocably undertaken to subscribe for its full entitlement under the Open Offer and for 5,118,013 New Ordinary Shares under the Placing. Rotolok is a related party of the Company for the purpose of the AIM Rules, as they already hold 16,868,225 Existing Ordinary Shares, currently representing 26.8 per cent. of the existing issued ordinary share capital of the Company.

Following the Placing and Open Offer, Rotolok will hold 27,721,434 New Ordinary Shares, representing 28.8 per cent. of the enlarged issued ordinary share capital of the Company ("Enlarged Share Capital").

Crystal Amber Fund Limited ("Crystal Amber") has irrevocably undertaken to subscribe for 5,118,012 New Ordinary Shares under the Placing and up to 14,584,337 New Ordinary Shares (including its full entitlement) under the Open Offer. Crystal Amber is a related party of the Company for the purpose of the AIM Rules, as they already hold 8,530,707 Existing Ordinary Shares, currently representing 13.6 per cent. of the existing issued ordinary share capital of the Company.

Following the Placing and Open Offer, Crystal Amber will hold a minimum of 16,549,159 New Ordinary Shares (assuming its minimum possible take up under the Placing and Open Offer), representing 17.2 per cent. of the Enlarged Share Capital. The maximum amount they may hold, assuming that no New Ordinary Shares are subscribed for by any qualifying shareholders save for Crystal Amber and those qualifying shareholders who have already committed to subscribe for their open offer entitlements, would be 28,233,056 New Ordinary Shares, representing 29.3 per cent. of the Enlarged Share Capital.

The independent directors of the Company, being Michael A. Knight, Jason W.H. Schofield, Natasha C. Gadsdon and Anthony D. Everett ("the Independent Directors") but not including Sean J. Swales by virtue of his position as Group Finance Director of Rotolok, consider, having consulted with Arden Partners, that the terms of these arrangements with Rotolok and Crystal Amber are fair and reasonable insofar as its Shareholders are concerned.

Irrevocable Undertakings

As at the date of this document, the Company has received irrevocable undertakings to vote in favour of the proposals from Rotolok accounting for 16,868,225 Existing Ordinary Shares, representing 26.8 per cent. of the Existing Share Capital.

Independent Directors' Intentions

The Independent Directors intend to subscribe for their full entitlements under the Open Offer, representing 54,950 New Ordinary Shares.

Current Trading and Future Prospects

The following is taken directly from the Chairman's Statement made in the interim results for the half year period to 30 September 2011, as announced by the Company on 8 December 2011:

"The Group has made steady and encouraging progress in implementing its strategy to improve and extend the core income earning base of the Group and move forward the development of its assets, whilst working to dispose of trading property stock.

Further lettings of void space have been achieved, reducing the void rate to 10.9 per cent. (31 March 2011: 14.3 per cent.), thereby helping to contain costs of maintaining empty properties. The marinas and car parks have traded on par with last year. As we look forward to the 2012/13 marina season we have re-launched the website and have increased marketing activity, to include attendance at the forthcoming London Boat Show, in order to increase our potential customer base of berth-holders and visitors.

We have a number of exciting opportunities in our pipeline to develop our future income and value growth. We aim to re-configure part of the Sutton Harbour Marinas to accommodate larger vessels and we have now submitted a planning application for the new 179 berth marina in the Millbay area of Plymouth. This new facility will enable the Group to build on its existing marina operations business and to attract more sailing enthusiasts to some of the best cruising waters that the UK has to offer.

The Group has secured the letting of the 705 sq m (7,585 sq ft) premises on Exeter Street to a gym operator and 577 sq m (6,212 sq ft) Jamaica House premises to a restaurateur. The Group continues to actively manage the lease renewal process as each falls due."

The full text of the interim results for the half year period to 30 September 2011 is available on the Company's website: www.sutton-harbour.co.uk.

The latest time for applications to be received under the Open Offer is 11.00 a.m. on 16 January 2012.

Michael A. Knight, Chairman of the Company, commented:

"The Millbay Marina Project is a unique opportunity to provide high quality facilities with direct access to some of the best cruising waters of the UK.

The project is in line with our stated strategy to focus on marine activities and the regeneration of waterfront areas whilst building the Group's core income base."

Enquiries:

For further information, please contact: 

Sutton Harbour Holdings plc

Jason Schofield

Natasha Gadsdon

01752 204186

Arden Partners plc

Richard Day

Chris Thomas

0207 614 5917

Threadneedle Communications

Graham Herring

Terry Garrett

020 7653 9850