Young & Co's Brewery Regulatory News (YNGA)

5 May 2005 07:00

Young & Co's Brewery PLC05 May 2005 5 May 2005 Young & Co.'s Brewery, P.L.C. Conversion of B Shares into A Shares, move to AIM and amendments to the Articles The Board of Young & Co.'s Brewery, P.L.C. is today issuing a circular toshareholders which sets out proposals intended to simplify its share structureand which are expected to provide greater liquidity in the Company's votingshares. Key aspects of these proposals are: • Conversion of the B Shares into A Shares, thereby creating a single class of A voting ordinary shares. • Delisting the existing A Shares and Non-Voting Shares from the Official List and, following the Conversion, seeking admission for trading of the enlarged class of A Shares and the Non-Voting Shares on AIM. • Making some necessary changes to the Articles consequent on the Conversion. The Conversion and amendments to the Articles are subject to the approval of AShareholders and B Shareholders which will be sought at an Extraordinary GeneralMeeting to be held on 2 June 2005 at the offices of JPMorgan Cazenove. The submission to the Extraordinary General Meeting of the resolutions toapprove the Conversion and the amendments to the Articles requires the priorapproval of B Shareholders which will be sought at a meeting of B Shareholdersimmediately prior to the Extraordinary General Meeting. John Young, Chairman of Young's, commented: "The growing success and popularity of AIM now presents us with a way ofsimplifying our share structure that we believe is in the best interests ofshareholders as a whole. Each shareholder's percentage holding in the Company'sissued share capital and voting rights at general meetings, in the case ofvoting shareholders, will remain unchanged. We believe that the greaterliquidity offered by the enlarged class of voting shares, and the inheritancetax advantage of AIM, will be of benefit to our shareholders." Copies of the circular will shortly be available for inspection at the UKListing Authority's Document Viewing Facility, which is situated at: Document Viewing Facility, 25 The North Colonnade, Canary Wharf, London E14 5HS. Expected Timetable |---------------------------------------------------------------|--------------||Meeting of B Shareholders and EGM | 2 June 2005||---------------------------------------------------------------|--------------||Last day of dealings on the Official List | 4 July 2005||Commencement of dealings on AIM | 5 July 2005||---------------------------------------------------------------|--------------| For further information: |---------------------------------------------------------------|--------------||Young & Co.'s Brewery, P.L.C. | 020 8875 7000||---------------------------------------------------------------|--------------||Peter Whitehead, Finance Director | ||---------------------------------------------------------------|--------------||Christopher Sandland, Director and Company Secretary | ||---------------------------------------------------------------|--------------||Hogarth Partnership | 020 7357 9477||---------------------------------------------------------------|--------------||James Longfield | ||---------------------------------------------------------------|--------------| Young & Co.'s Brewery, P.L.C. (the "Company") CONVERSION OF B SHARES INTO A SHARES, MOVE TO AIM AND AMENDMENTS TO THE ARTICLES Introduction The directors of the Company ("Directors") today announce their proposal thatthe Company should simplify its share structure by converting the 'B' ordinaryshares of 50p each in the capital of the Company ("B Shares") into 'A' ordinaryshares of 50p each in the capital of the Company ("A Shares"), thereby creatinga single class of voting ordinary shares ("Conversion"). In conjunction with theConversion, the Directors propose certain necessary amendments to the Company'sarticles of association ("Articles"). At a later date, and assuming they believe it appropriate, the Directors intendto submit a proposal to adopt new articles of association that are more in linewith current best practice. The Directors also propose the delisting of the existing A Shares and thenon-voting ordinary shares of 50p each in the capital of the Company("Non-Voting Shares") from the official list of the UK Listing Authority ("Official List") and, following the Conversion, the admission of the enlargedclass of A Shares and the Non-Voting Shares to trading on AIM. The Conversion and the amendments to the Articles (the "Proposals") are subjectto the approval of the holders of A Shares ("A Shareholders") and the holders ofB Shares ("B Shareholders") together at an Extraordinary General Meeting. Thesubmission of the resolutions to approve the Proposals to the ExtraordinaryGeneral Meeting requires the prior approval of B Shareholders which will besought at a separate meeting of B Shareholders. The resolutions, if passed, willtake effect immediately prior to the admission to AIM. If admission to AIM doesnot take place, the resolutions will not take effect. A circular to shareholders with notices convening a separate meeting of BShareholders and an Extraordinary General Meeting, both to be held on 2 June2005, will be posted today. Background to and reasons for transferring to AIM and the Proposals Transferring to AIM The conversion of B Shares into A Shares and the transfer of the A Shares andNon-Voting Shares from the Official List to AIM allows the simplification of theCompany's share structure by creating a single class of voting ordinary shares,without, on the basis of the Directors' current understanding of tax law andpractice, affecting the inheritance tax advantage currently enjoyed byindividual holders of B Shares. A Shareholders and B Shareholders should benefitfrom greater liquidity as a result of the enlarged share class. Individuals whohold A Shares or Non-Voting Shares may, after two years, also benefit from the AShares and Non-Voting Shares no longer normally being subject to inheritancetax. AIM was launched by the London Stock Exchange in 1995. The market was andremains specifically designed for smaller companies and provides a simplifiedregulatory environment. The Directors believe that the Conversion and thetransfer of the A Shares and Non-Voting Shares from the Official List to AIM canreduce ongoing costs and simplify administration requirements. The obligations of an AIM company are similar to those of a company on theOfficial List with certain exceptions, of which the significant ones arereferred to below. In addition, as the 9.5% debenture stock remains listed, theCompany will still be required to comply with certain listing rules of the UKListing Authority, including (with a few limited exceptions) those regardingcontinuing obligations, financial information, approval of circulars, thepurchase of own securities and directors. There are certain differences between the AIM and the Official List regulatoryrequirements including: • For AIM companies, prior shareholder approval is only required for reverse-takeovers and disposals that result in a fundamental change of business (transactions that exceed 75% of various size tests, such as the ratio of the consideration of the transaction to the market capitalisation). Under the listing rules of the UK Listing Authority a broader range of transactions require shareholder approval. • There is no requirement under the AIM rules for listing particulars or admission documents for further issues of securities, except as otherwise required by law or on admission of a new class of securities to trading. • Under the AIM rules, a nominated adviser is required at all times and has ongoing responsibilities to both the Company and the London Stock Exchange. • The Combined Code does not apply directly to AIM companies. Since AIM opened in 1995, more than 1,600 companies have been admitted and morethan £15 billion has been raised in total. Liquidity on AIM is currently provided by market makers who are member firms ofthe London Stock Exchange and are obliged to quote a price in shares between8.00 a.m. and 4.30 p.m. on business days. The Directors believe that AIM hasdemonstrated that it can provide a liquid trading platform for shares. The Company has a significant number of private shareholders. Companies whoseshares trade on AIM are deemed to be unlisted for the purposes of certain areasof UK taxation. Following the transfer to AIM, individuals who hold shares inthe enlarged class of A Shares or individuals who hold Non-Voting Shares should,after two years, therefore enjoy similar inheritance tax advantages to thosewhich should continue to be enjoyed by individuals who held B Shares. The 9.5% debenture stock remains on the Official List and will be the Company'sonly main market listed security. As a result, business asset taper relief forcapital gains tax purposes will not usually be available. Shareholders or prospective investors should consult their own professionaladvisers on whether an investment in an AIM security is suitable for them, orwhether the tax advantages referred to above may be available to them. Inparticular, they should note that it is not possible to hold shares traded onAIM in PEPs or ISAs. The comments on the tax implications described in this announcement are based onthe Directors' current understanding of tax law and practice. They are nottailored to any individual circumstances in the interests of simplicity.Information on taxation is primarily directed at individuals who are UK residentand domiciled. Tax rules can change and the precise tax implications for youwill depend on your particular circumstances. The Directors cannot acceptresponsibility for any actions taken on the basis of this announcement alone. Ifyou are in any doubt as to your tax position, you should consult yourprofessional adviser. The Conversion The Company currently has three classes of ordinary shares, all of which rankequally for the purposes of participation in profits or assets, but theNon-Voting Shares do not confer the right to receive notice of or attend or voteat general meetings of the Company. The Conversion simplifies the Company's share structure and is expected toprovide B Shareholders with greater liquidity through ownership of A Shares thatcan be freely traded on a securities market. A Shareholders should also benefitfrom the greater liquidity of the enlarged share class and the equalisation ofvoting rights following the removal of the requirement to obtain approval of BShareholders before, amongst other things, altering the Articles, certain issuesof new ordinary shares, the winding up of the Company or its amalgamation withany other company or the transfer or disposal of the Company's undertaking (the"B Share Approval Right"). The Conversion would take effect immediately prior to Admission. Conversion The Conversion will create a single class of voting ordinary shares in theCompany. B Shareholders at close of business on 4 July 2005 will have each BShare held by them redesignated as an A Share, ranking pari passu with andhaving the same rights under the Articles as the existing A Shares. Therefore,following the Conversion, the B Shareholders will hold: one A Share in place of every B Share held. As a result of the Conversion, the share capital of the Company will change asfollows: |------------------|-----------|-------|--|----------------|-----------|-------||Prior to | | | | Post the | | ||the Conversion | | | | Conversion | | ||------------------|-----------|-------|--|----------------|-----------|-------|| | Issued | % of | | | Issued | % of || | shares | votes | | | shares | votes ||------------------|-----------|-------|--|----------------|-----------|-------||A Shares | 3,141,400 | 43% | | A Shares |7,266,000 | 100% ||------------------|-----------|-------|--|----------------|-----------|-------||B Shares | 4,124,600 | 57% | | B Shares | - | - ||------------------|-----------|-------|--|----------------|-----------|-------||Combined A Shares | | | | Enlarged class | | ||and B Shares | 7,266,000 | 100% | | of A Shares |7,266,000 | 100% ||------------------|-----------|-------|--|----------------|-----------|-------||Non-Voting Shares | 4,790,000 | 0% | | Non-Voting |4,790,000 | 0% || | | | | Shares | | ||------------------|-----------|-------|--|----------------|-----------|-------| Following the Conversion, the Company's issued ordinary share capital willcomprise 7,266,000 A Shares and 4,790,000 Non-Voting Shares. No new shares arebeing issued and each shareholder's percentage holding in the issued sharecapital and voting rights at general meetings (in the case of votingshareholders) and participation in the profits, dividends and assets of theCompany remains unchanged. As at the date of this announcement, no shares in thecapital of the Company are held as treasury shares. Transfer of trading to AIM Conditional on the resolutions being approved at the EGM, the Company givesnotice to cancel the listing of the A Shares and Non-Voting Shares on theOfficial List in the circular to shareholders and will apply to the London StockExchange for admission to AIM. It is anticipated that the listing and trading ofthe A Shares and Non-Voting Shares on the Official List will cease at close ofbusiness on 4 July 2005 being not less than 20 business days from the date ofthe circular to shareholders. Admission to AIM is expected to take place anddealings are expected to commence on AIM on 5 July 2005. Amendments to the Articles The Directors also propose that the Company should make some changes to theArticles. The changes being proposed are those necessary as a result of theConversion. The changes involve: • the deletion of the B Share Approval Right; • the deletion of the requirement for each of the Directors to hold 1,000 B Shares and to vacate office if such shares are not held; and • the amendment of the requirement that, to be quorate at general meetings of the Company, a certain proportion of B Shares must be represented at the meeting. After the Conversion, two A Shareholders, present in person or by proxy, will be a quorum. The amendments to the Articles would take effect immediately prior to theadmission to AIM. This information is provided by RNS The company news service from the London Stock Exchange