Directorate Change

22 Apr 2009 10:30



22 April 2009

Medsea Estates Group Plc

('the Company' or 'Medsea')

Resignation of the Independent Director

Background

On 7 April 2009 the Company posted a circular ("Circular") to convene an Extraordinary General Meeting ("EGM") to be held at 32 Percy Street, London W1T 2DE on 30 April 2009 at 10.30am. 

The Circular detailed the intention of the Company to enter into a related party transaction in order to complete the disposal ("Disposal") of Medsea UK Limited, a material operating subsidiary, to the current executive directors of the Company.

The Disposal will constitute a fundamental change of business as defined by the AIM Rules. Furthermore, as the Disposal is to the current executive directors of the Company, it would be recognised as a related party transaction under the AIM Rules. Moreover, related party transactions require that an independent director of the Company provide to all shareholders a "fair and reasonable" opinion with regard to the terms of the transactions. The Circular posted on 7 April 2009 included a letter from Neil Craven, the independent director of the Company, confirming that the terms of the Disposal were "fair and reasonable" insofar as its shareholders are concerned.

Resignation of Independent Director

On 7 April 2009, the executive directors became aware that Neil Craven wished to withdraw his "fair and reasonable" opinion provided in the Circular. However, the Circular had been released for posting on the morning of 7 April 2009 which led to a failure to withdraw the Circular in advance of its posting. Furthermore, on 8 April 2009, Neil Craven tendered his resignation from the Company with immediate effect. 

Implications of the Resignation and to the Circular

The Company is currently unable to satisfy the AIM Rule with regard to the provision of a "fair and reasonable" opinion from an independent director for the completion of the Disposal to the related parties being the current executive directors.

Therefore, the board of the Company will seek to appoint a new independent director to review the terms of the Disposal and where appropriate provide a "fair and reasonable" opinion. 

Finally, the Company intends to issue an addendum to the Circular posted on 7 April 2009.

An announcement will follow in due course to update shareholders of any new information and details of the posting of an addendum to the Circular.

Medsea Estates Group plc 

Tony Gatehouse, Chairman 

Tel: +34 96 570 40 02