AIM Schedule 1 update - CPPGroup Plc (1884C)
January 14 2015 - 11:22AM
UK Regulatory
TIDMCPP
RNS Number : 1884C
AIM
14 January 2015
ANNOUNCEMENT TO BE MADE BY THE AIM APPLICANT PRIOR TO ADMISSION
IN ACCORDANCE WITH RULE 2 OF THE AIM RULES FOR COMPANIES ("AIM
RULES")
COMPANY NAME:
CPPGroup Plc (also referred to in this document as "CPP" or
"Group").
COMPANY REGISTERED OFFICE ADDRESS AND IF DIFFERENT, COMPANY
TRADING ADDRESS (INCLUDING POSTCODES) :
Holgate Park
Holgate Road
York
YO26 4GA
COUNTRY OF INCORPORATION:
England and Wales
COMPANY WEBSITE ADDRESS CONTAINING ALL INFORMATION REQUIRED
BY AIM RULE 26:
www.cppgroupplc.com
COMPANY BUSINESS (INCLUDING MAIN COUNTRY OF OPERATION) OR,
IN THE CASE OF AN INVESTING COMPANY, DETAILS OF ITS INVESTING
POLICY). IF THE ADMISSION IS SOUGHT AS A RESULT OF A REVERSE
TAKE-OVER UNDER RULE 14, THIS SHOULD BE STATED:
CPP is an international assistance business operating in the
UK and overseas within the financial services, telecommunications
and travel sectors. CPP primarily operates a business-to-business-to-consumer
(B2B2C) business model providing services and retail, wholesale
and packaged products to customers through Business Partners
and direct to consumer. The Group's core assistance and travel
service products are designed to make everyday life easier
to manage.
CPP's main country of operation is in the United Kingdom.
DETAILS OF SECURITIES TO BE ADMITTED INCLUDING ANY RESTRICTIONS
AS TO TRANSFER OF THE SECURITIES (i.e. where known, number
and type of shares, nominal value and issue price to which
it seeks admission and the number and type to be held as treasury
shares):
Number of shares to be admitted: 838,316,608
Type and nominal value of shares: Ordinary shares of 1 pence
each
Included in the above number of shares are 666,666,667 placing
shares with an issue price of 3 pence
Shares to be held in treasury: None
CAPITAL TO BE RAISED ON ADMISSION (IF APPLICABLE) AND ANTICIPATED
MARKET CAPITALISATION ON ADMISSION:
New capital to be raised on admission to AIM: GBP20.0 million
Anticipated market capitalisation on admission to AIM: c.GBP37m
PERCENTAGE OF AIM SECURITIES NOT IN PUBLIC HANDS AT ADMISSION:
83%
DETAILS OF ANY OTHER EXCHANGE OR TRADING PLATFORM TO WHICH
THE AIM COMPANY HAS APPLIED OR AGREED TO HAVE ANY OF ITS SECURITIES
(INCLUDING ITS AIM SECURITIES) ADMITTED OR TRADED:
N/A
FULL NAMES AND FUNCTIONS OF DIRECTORS AND PROPOSED DIRECTORS
(underlining the first name by which each is known or including
any other name by which each is known):
Eric Edward Anstee (Non-Executive Chairman)
Brent Escott (Chief Executive Officer)
Craig Parsons (Chief Financial Officer)
Ruth Elizabeth Evans (Non-Executive Director)
Shaun Kingsley Astley-Stone (Non-Executive Director)
FULL NAMES AND HOLDINGS OF SIGNIFICANT SHAREHOLDERS EXPRESSED
AS A PERCENTAGE OF THE ISSUED SHARE CAPITAL, BEFORE AND AFTER
ADMISSION (underlining the first name by which each is known
or including any other name by which each is known):
Before admission shares held (percentage of Company shares
held):
* Mr Hamish Ogston: 96,331,789 (56.1%)
* Schroder Investment Management Ltd: 22,310,544
(13.0%)
* Phoenix Asset Management Partners Ltd: 0 (0%)
* Mr Tariq Rashid 5,500,000: (3.2%)
Following admission shares held (percentage of Company shares
held):
* Mr Hamish Ogston: 360,476,141 (43.0%)
* Schroder Investment Management Ltd: 83,747,829
(9.99%)
* Phoenix Asset Management Partners Ltd: 335,326,643
(40.0%)
* Mr Tariq Rashid 5,500,000 (
NAMES OF ALL PERSONS TO BE DISCLOSED IN ACCORDANCE WITH SCHEDULE
2, PARAGRAPH (H) OF THE AIM RULES:
None.
(i) ANTICIPATED ACCOUNTING REFERENCE DATE
(ii) DATE TO WHICH THE MAIN FINANCIAL INFORMATION IN THE ADMISSION
DOCUMENT HAS BEEN PREPARED (this may be represented by unaudited
interim financial information)
(iii) DATES BY WHICH IT MUST PUBLISH ITS FIRST THREE REPORTS
PURSUANT TO AIM RULES 18 AND 19:
(i) 31 December
(ii) No admission document. Latest published financial information:
a) Half Year Report for the six months to 30 June 2014 (incorporating
the unaudited, but independently reviewed, condensed consolidated
interim financial statements for the same period), announced
on 29 August 2014. b) Audited Annual Report and Accounts for
the year ended 31 December 2013 (incorporating the group and
company financial statements for the same period), announced
on 23 April 2014.
(iii) 30 June 2015 (Annual Report and Accounts for the year
ended 31 December 2014), 30 September 2015 (Half Year Report
for the six months to 30 June 2015), 30 June 2016 (Annual Report
and Accounts for the year ended 31 December 2015).
EXPECTED ADMISSION DATE:
11 February 2015.
NAME AND ADDRESS OF NOMINATED ADVISER:
Numis Securities Limited
The London Stock Exchange Building
10 Paternoster Square
London
EC4M 7LT
NAME AND ADDRESS OF BROKER:
Numis Securities Limited
The London Stock Exchange Building
10 Paternoster Square
London
EC4M 7LT
OTHER THAN IN THE CASE OF A QUOTED APPLICANT, DETAILS OF WHERE
(POSTAL OR INTERNET ADDRESS) THE ADMISSION DOCUMENT WILL BE
AVAILABLE FROM, WITH A STATEMENT THAT THIS WILL CONTAIN FULL
DETAILS ABOUT THE APPLICANT AND THE ADMISSION OF ITS SECURITIES:
Not applicable - quoted applicant.
DATE OF NOTIFICATION:
14 January 2015.
NEW/ UPDATE:
Update
QUOTED APPLICANTS MUST ALSO COMPLETE THE FOLLOWING:
THE NAME OF THE AIM DESIGNATED MARKET UPON WHICH THE APPLICANT'S
SECURITIES HAVE BEEN TRADED:
Premium segment of the FCA's Official List / Main Market of
the London Stock Exchange.
THE DATE FROM WHICH THE APPLICANT'S SECURITIES HAVE BEEN SO
TRADED:
Admission and commencement of unconditional dealings from 24
March 2010.
CONFIRMATION THAT, FOLLOWING DUE AND CAREFUL ENQUIRY, THE APPLICANT
HAS ADHERED TO ANY LEGAL AND REGULATORY REQUIREMENTS INVOLVED
IN HAVING ITS SECURITIES TRADED UPON SUCH A MARKET OR DETAILS
OF WHERE THERE HAS BEEN ANY BREACH:
Save as set out below, the Company has adhered to the legal
and regulatory requirements applicable to companies admitted
to the Official List (premium segment) and the regulated market
of the London Stock Exchange plc.
On 10 October 2012, the Company entered into retention arrangements
with certain members of management of the Group's North American
business (including two directors of one of the Company's North
American subsidiaries) prior to its proposed disposal, whereby
in return for a retention payment such members of management
agreed to sign up to notice periods and appropriate restrictive
covenants. These arrangements constituted a related party transaction
with the relevant directors under Listing Rule 11. The Company
entered into these arrangements having taken independent financial
advice which concluded that incentivising the key senior managers
at CPP North America in relation to the sale was necessary
to the Company in terms of maximising the involvement and engagement
of these key senior managers in the sale process, which in
turn should maximise the sale proceeds to the Company and therefore
be in the best interests of all of the Company's shareholders.
However, the Company did not comply with the requirements of
Listing Rule 11.1.10R (as it applied at the time) in connection
with the entry into these arrangements and although it had
obtained independent financial advice, it did not consult a
sponsor in connection with the retention arrangements.
The Company notified the UK Listing Authority promptly on becoming
aware of these possible breaches and subsequently entered into
further agreements on 15 April 2013 amending the relevant arrangements
and complied in full with LR 11.1.10R in relation to this amendment
to the relevant related party transactions. Full details of
the related party transactions, as so amended, were disclosed
in the Company's annual report and accounts for the year ended
31 December 2013. On 21 May 2014 the Financial Conduct Authority
issued a private warning to the Company in respect its apparent
failure to comply with Listing Rule 8.2.3R prior to entering
into the relevant retention arrangements. This private warning
does not constitute a determination by the FCA that the Company
breached the Financial Conduct Authority's rules (including
the Listing Rules) and no further action has been taken by
the Financial Conduct Authority.
While not a breach in relation to the Company's legal and regulatory
requirements involved in having its securities traded, shareholders
and investors are also referred to the detail on the fine levied
by the FCA on Card Protection Plan Ltd in November 2012. This
detail is set out in the section on significant change below
and has been publicly disclosed by the Company since November
2012.
AN ADDRESS OR WEB-SITE ADDRESS WHERE ANY DOCUMENTS OR ANNOUNCEMENTS
WHICH THE APPLICANT HAS MADE PUBLIC OVER THE LAST TWO YEARS
(IN CONSEQUENCE OF HAVING ITS SECURITIES SO TRADED) ARE AVAILABLE:
http://www.cppgroupplc.com/investor-relations/regulatory-announcements/
DETAILS OF THE APPLICANT'S STRATEGY FOLLOWING ADMISSION INCLUDING,
IN THE CASE OF AN INVESTING COMPANY, DETAILS OF ITS INVESTING
STRATEGY:
Following admission to AIM, the Group will continue its journey
to stabilise the business and build the platform to support
its future, through the following measures:
a) continued management action to reduce the Group's cost base
including completing the exit of Hong Kong and Brazil and closure
of two of the Group's three office sites in the UK in keeping
with the reduced scale of the business;
b) improving the operational environment including the implementation
of a new cost-effective IT system which is expected to increase
operational efficiency and meet the needs of customers more
effectively, supporting the Group's operational environment
and governance and, in turn, assisting in the Group's efforts
to secure the FCA's agreement to remove the restrictions under
the VVOPs in early 2016;
c) continuing the process of further strengthening the Group's
governance, risk and compliance framework alongside improving
business processes across the Group; and
d) identifying new growth opportunities to leverage existing
relationships and capability.
A DESCRIPTION OF ANY SIGNIFICANT CHANGE IN FINANCIAL OR TRADING
POSITION OF THE APPLICANT, WHICH HAS OCCURRED SINCE THE END
OF THE LAST FINANCIAL PERIOD FOR WHICH AUDITED STATEMENTS HAVE
BEEN PUBLISHED:
The Group's performance during the period since 31 December
2013 to the date of publication of this document (based on
the most recent management accounts available) reflects the
following:
Group revenue from continuing operations has declined approximately
38 per cent. on a constant currency basis compared to the same
period in 2013, principally due to reduced Card Protection
and Identity Protection renewals and the impact of Business
Partner contract losses in the UK.
The Annual Renewal Rate as at 30 November 2014 has increased
in the period to 70.8 per cent. As noted in the Group's announcements
during 2014, cancellations through the Scheme are not included
in the reported renewal rate. If Scheme cancellations were
included, the annual renewal rate would be 4.9 percentage points
lower at approximately 65.9 per cent. This impact will increase
as further Scheme cancellations that were live policies before
the Scheme commenced reach their scheduled renewal date. Live
policies as at 30 November 2014 totalled 5.2 million, 2.0 million
lower than reported at 31 December 2013, mainly reflecting
declining retail Card Protection and Identity Protection policies
in the UK, which include the impact of policies cancelled through
the Scheme and a reduction in Packaged and Wholesale policies
in the UK following historical Business Partner contract losses.
As announced on 5 December 2014, the provision for customer
redress and associated costs in the Group's consolidated financial
statements has been increased by GBP3.0 million, reflecting
the latest estimate with respect to residual customer redress
activity. This is expected to be funded from existing VVOP-restricted
capital held within the Group's regulated entities in the UK
and relates to certain redress obligations specific to Card
Protection Plan Ltd or Homecare Insurance Ltd (which these
entities may meet out of their own capital without seeking
the consent of either the PRA or the FCA). The total cost provided
for customer redress and associated costs at the date of this
document is GBP72.8 million, of which GBP14.9 million remains
available, representing GBP6.4 million in remaining customer
redress and associated costs and GBP8.5 million in respect
of the outstanding regulatory fine levied by the FCA on Card
Protection Plan Ltd in November 2012 (the remaining instalments
are expected to fall due to be paid in 2016).
The Group's net funds position (based on the most recent management
accounts available) is GBP7.7 million. This position represents
a decrease of GBP36.6 million from the year end position at
31 December 2013, principally as a result of the continued
settlement of the customer redress provision. There is currently
limited free cash at Group level and this is expected to remain
the case until receipt of the proceeds of the Placing on Admission.
Save as disclosed above and announced throughout 2014, there
has been no significant change in the financial or trading
position of the Group since 31 December 2013 the date to which
the last audited results of the Company were prepared.
A STATEMENT THAT THE DIRECTORS OF THE APPLICANT HAVE NO REASON
TO BELIEVE THAT THE WORKING CAPITAL AVAILABLE TO IT OR ITS
GROUP WILL BE INSUFFICIENT FOR AT LEAST TWELVE MONTHS FROM
THE DATE OF ITS ADMISSION:
The Directors of CPPGroup Plc have no reason to believe that
the working capital available to it and its Group will be insufficient
for at least twelve months from the date of its admission.
DETAILS OF ANY LOCK-IN ARRANGEMENTS PURSUANT TO RULE 7 OF THE
AIM RULES:
N/A
A BRIEF DESCRIPTION OF THE ARRANGEMENTS FOR SETTLING THE APPLICANT'S
SECURITIES:
Settlement will be through the CREST system for uncertificated
shares. Shareholders can also deal based on share certificates.
A WEBSITE ADDRESS DETAILING THE RIGHTS ATTACHING TO THE APPLICANT'S
SECURITIES:
http://www.cppgroupplc.com/media/35390/cppgroup-plc-articles-of-plc.pdf
INFORMATION EQUIVALENT TO THAT REQUIRED FOR AN ADMISSION DOCUMENT
WHICH IS NOT CURRENTLY PUBLIC:
Please see the Appendix to this Schedule 1 announcement which
is available on the Company's website at: www.cppgroupplc.com
A WEBSITE ADDRESS OF A PAGE CONTAINING THE APPLICANT'S LATEST
ANNUAL REPORT AND ACCOUNTS WHICH MUST HAVE A FINANCIAL YEAR
END NOT MORE THEN NINE MONTHS PRIOR TO ADMISSION AND INTERIM
RESULTS WHERE APPLICABLE. THE ACCOUNTS MUST BE PREPARED IN
ACCORDANCE WITH ACCOUNTING STANDARDS PERMISSIBLE UNDER AIM
RULE 19:
www.cppgroupplc.com/investor-relations/key-financial-data/announcements-statements/
THE NUMBER OF EACH CLASS OF SECURITIES HELD IN TREASURY:
None.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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