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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