TIDMASG
RNS Number : 4065J
ASG Media PLC
30 March 2010
30 March 2010
ASG Media plc (in Administration)
("ASG" or the "Company")
Details of proposed Company Voluntary Arrangement, Fundamental Change of
Investing Strategy, share capital reorganisation and change of name
Introduction
The Company has today announced that it has posted details of the Proposals to
Shareholders and given notice of a General Meeting to be held on 1 April 2010.
The Proposals incorporate:
· Details of a Company Voluntary Arrangement,
· Fundamental Change of Investing Strategy
· Share capital reorganisation
· Subscription for new Ordinary Shares
· Change of name
ASG announced on 20 October 2009 that it was in discussions with potential
investors to secure the funding required to meet the Company's immediate and
longer term finance commitments. However, due to the uncertainty as to the
timing and final outcome of those discussions, the Directors had requested the
suspension of dealings in the Ordinary Shares on AIM, pending the outcome of the
Company's discussions with potential investors.
Having determined subsequently that the prospects of obtaining additional
funding were remote, it was announced that the Company had been placed in
administration. The Administrators were appointed on 2 November 2009 as
administrators in accordance with the Insolvency Act 1986.
It was further announced on 4 November 2009 that the Administrators had sold
certain of assets of the Company and the Former Subsidiaries, as a result of
which the Administrators have settled all of the secured indebtedness of the
Company and the Former Subsidiaries. On 4 November 2009, the business and
assets of the Former Subsidiaries were sold to Trainfx Limited, a subsidiary of
RAM Investment Group Plc for GBP155,000 excluding receivables and on 9 November
2009 certain other assets of ASG were sold to the same purchaser for GBP20,000.
The proceeds of the realisation of the businesses of the Former Subsidiaries are
expected to provide for a distribution to the Company in respect of the
indebtedness owing by the Former Subsidiaries to the Company which is expected
to be not more than GBP100,000. This distribution is to be assigned by the
Administrators to a newly incorporated company, ASG Distribution Limited, which
has been formed by the Administrators to conduct the hive down of the residual
assets and rights of the Company and to assume liability to its Creditors on the
basis summarised in the CVA Proposal circulated by the Administrators. The
Creditors will be able to recover the amount of the distribution to which they
are entitled, which arises from the amount recovered by the Company from the
realisation of the assets of the Former Subsidiaries, once ASG Distribution has
been liquidated, which is to take place once the CVA has been approved. It is
not considered that these arrangements will cause any additional delay in
enabling the Creditors to receive the distribution.
Apart from the distribution mentioned above, there were no other proceeds of the
realisation of the Company's assets that would allow any distribution to the
Creditors. The Company's investment in the Former Subsidiaries, which are also
to be transferred to ASG Distribution, has no economic value.
The Administrators have taken account of the outcome of the realisation of
assets by the Company to reassess the financial position of the Company and the
objectives of the administration.
Proposals
The Board and the Administrators have considered the position of the Company and
of its Creditors and Shareholders with regard to the outcome of the
administration.
The Company has entered into an agreement with ADM under which ADM will
subscribe for a total of 625,000 New Ordinary Shares to raise GBP6,250 and will
advance GBP50,000 to subscribe for Convertible Notes. The subscription is
conditional upon completion of the Proposals. The funds raised will enable the
Company to conduct a CVA and to seek re-admission to AIM. Following the CVA, if
approved by Creditors and Shareholders, the Company would become an investing
company listed on AIM. The Creditors are to be offered New Ordinary Shares in
satisfaction of amounts owed to them by the Company (to the extent that such
indebtedness is not the subject of the distribution by ASG Distribution referred
to above) in order to eliminate the Company's indebtedness and liabilities
details of which are set out in the CVA Proposal. Subject to the CVA being
approved, ADM will invest as shown in this document to provide the Company with
the requisite funding to conduct the CVA, to seek a return to listing on AIM and
to provide the Company with working capital. The Directors objective in
proposing this course is to enable Creditors and Shareholders to recover some
value by holding shares in an AIM quoted investing company.
Under the terms of the CVA, the Creditors will, in aggregate, be offered a total
of 1,000,000 New Ordinary Shares, to be divided among Creditors who make a claim
within three months of the date of the CVA being approved. The New Ordinary
Shares to be held by Creditors will represent approximately 47.64 per cent of
the New Ordinary Shares in issue immediately following the CVA including the New
Ordinary Shares to be issued to ADM and Antony Batty in his capacity as the
supervisor of the CVA, referred to below. This proportion will be heavily
diluted by New Ordinary Shares that are capable of being issued under the
Warrants and the Convertible Loan Notes to be issued once the CVA has been
implemented.
The Board believes that the implementation of the Proposals would enable the
Company to be re-admitted to AIM with the prospect of being able to realise some
value for Creditors and Shareholders as a result. By implementing the
Proposals, there is a prospect that the New Ordinary Shares, once returned to
trading on AIM, may achieve a value that could provide a better return than
would otherwise be available to Creditors and Shareholders.
Subscription for New Ordinary Shares
The Company has entered into an agreement with ADM under which, subject to
implementation of the Proposals, 625,000 New Ordinary Shares will be issued to
ADM at GBP0.001 per share for a total subscription price of GBP6,250. These New
Ordinary Shares issued to ADM will represent 29.78 per cent. of the Enlarged
Ordinary Share Capital. ADM is not connected with any of the Directors of the
Company.
The Company will, conditional on the implementation of the Proposals, issue
182,585 New Ordinary Shares to Antony Batty at an issue price of GBP0.001 per
share. These New Ordinary Shares that are to be issued to Antony Batty will
represent 8.69 per cent. of the Enlarged Ordinary Share Capital.
Convertible Loan
The Company would also require funding to be made available to enable it to
ensure that it has sufficient working capital for its present requirements.
Accordingly, subject to the implementation of the Proposals, ADM has irrevocably
undertaken that it will subscribe for GBP50,000 of Convertible Notes. The
Convertible Notes are to be interest free, unsecured and repayable on 31
December 2012. ADM shall have the right to convert the principal amount of the
Convertible Notes at any time into an aggregate amount of 50,000,000 New
Ordinary Shares at the exercise price of GBP0.001 per share. The New Ordinary
Shares to be issued on conversion of the Convertible Notes (assuming full
conversion) would amount to approximately 90.25 per cent of the Enlarged
Ordinary Share Capital of the Company, as increased by the issue thereof. The
Convertible Notes are freely transferable and may be transferred by ADM to new
noteholders who will then be able to exercise the conversion rights attaching to
the Convertible Notes.
Warrants
The Company has granted to ADM, conditional on the implementation of the
Proposals, warrants for 51,265,000 New Ordinary Shares. These Warrants carry
the right to subscribe for New Ordinary Shares at an exercise price of GBP0.001
for each New Ordinary Share exercisable at any time until 31 December 2012. The
Warrants are freely transferable and may be transferred by the holders to new
holders who will then be able to exercise the Warrants to subscribe for New
Ordinary Shares.
The Company has also agreed to issue Warrants to Antony Batty, as supervisor of
the CVA, and to Charles Stanley in partial settlement of fees due for their
services. In addition, Warrants have been granted to Germiston Investments
Limited, a company registered in Panama, for its assistance in formulating the
Proposals. The beneficial owner of Germiston Investments Limited is La
Rochevillars, a company registered in Switzerland.
These Warrants carry the same terms as the Warrants described above and are
allocated as follows:
+---------------------------------+------------------+
| Name | Number of |
| | Warrants |
+---------------------------------+------------------+
| | |
+---------------------------------+------------------+
| Antony Batty | 365,170 |
+---------------------------------+------------------+
| Charles Stanley | 900,000 |
+---------------------------------+------------------+
| Germiston Investments Limited | 8,170,779 |
+---------------------------------+------------------+
The Takeover Code
The Takeover Code is issued and administered by the Panel on Takeovers and
Mergers. The Takeover Code applies to all takeovers and merger transactions,
however effected, where the offeree company is, inter alia a public company with
its registered office in the UK and whose place of central management and
control is in the UK. The Company is such a company and its shareholders are
entitled to the protections afforded by the Takeover Code.
Under Rule 9 of the Takeover Code ("Rule 9"), when any person, or group of
persons acting in concert, acquires an interest in shares which, when taken
together with shares in which he, or persons acting in concert with him, are
interested, carry 30% or more of the voting rights of a company which is subject
to the Takeover Code, that person is normally required to make a general offer
in cash to all shareholders at the highest price paid by him, or any person
acting in concert with him, within the 12 months preceding the date of the
announcement of the offer.
If ADM were to exercise the Warrants and/or the conversion rights attached to
the Convertible Notes and as a result cause its holding of New Ordinary Shares
(together with the New Ordinary Shares held by any persons acting in concert
with ADM) to represent 30 per cent or more of the issued New Ordinary Shares as
enlarged by the exercise of the Warrants or the Conversion Rights the
requirements of Rule 9 would be invoked and ADM would be required to make a
mandatory cash offer for all of the remaining New Ordinary Shares in issue.
ADM has indicated that it is not its current intention to exercise Warrants and
the conversion rights attached to the Convertible Notes if, by so doing ADM will
be required to make a mandatory offer under Rule 9. The Warrants and the
Convertible Notes are freely transferable and ADM might elect to transfer all or
part of its holding to a third party, deemed to be not acting in concert with
ADM, and those persons may exercise the Warrants and convert the Convertible
Notes acquired by them without invoking Rule 9.
Proposed Capital Reorganisation
It is proposed that the issued share capital of the Company will be
restructured, prior to the implementation of the CVA, in order to reduce the
nominal value of the Ordinary Shares. At the outset all of the Ordinary Shares
of 1p each will be consolidated into Ordinary Shares of GBP5.50 each on the
basis of one New Ordinary Share for each 550 existing Ordinary Shares in issue.
The Ordinary Shares of GBP5.50 each will then be subdivided into one New
Ordinary Share of GBP0.00001 and one deferred share of GBP5.49999.
Following the capital reorganisation the issued share capital of the Company
will consist of 291,466 Ordinary Shares of GBP0.00001 each and 291,466 Deferred
Shares of GBP5.49999 each credited as fully paid up. The Deferred Shares shall
have the special rights, and shall be subject to the restrictions, set out in
the Articles of Association of the Company which, it is proposed, will be
amended accordingly pursuant to the Resolutions. The Deferred Shares will carry
negligible value and will not be admitted to trading on AIM.
The Resolutions to carry out the proposed Capital Reorganisation are to be put
to Shareholders at the General Meeting convened by the enclosed Notice. If the
Proposals are not approved by Shareholders it is likely that the Company will be
subject to insolvent liquidation as there are insufficient assets to repay the
Creditors. In this situation it is likely that there will be no return to
Shareholders.
Significant shareholdings
Set out below is a table which illustrates the shareholdings of existing and new
shareholders upon implementation of the Proposals as set out above:
+-------------------+-----------+---------+------------+-------------+-------------+---------+
| Shareholder | Ordinary | % of | Warrants | Convertible | Fully | % of |
| | shares | issued | | Notes | diluted | fully |
| | | share | | | holdings | diluted |
| | | capital | | | upon | share |
| | | | | | exercise | capital |
| | | | | | of | |
| | | | | | Warrants | |
| | | | | | and | |
| | | | | | Convertible | |
| | | | | | Notes | |
+-------------------+-----------+---------+------------+-------------+-------------+---------+
| Existing Ordinary | 294,116 | 13.99% | - | - | 294,116 | 0.26% |
| Shares | | | | | | |
+-------------------+-----------+---------+------------+-------------+-------------+---------+
| ADM | 625,000 | 29.74% | 51,265,000 | 50,000,000 | 101,890,000 | 90.33% |
+-------------------+-----------+---------+------------+-------------+-------------+---------+
| Germiston | - | - | 8,170,779 | - | 8,170,887 | 7.24% |
| Investments Ltd | | | | | | |
+-------------------+-----------+---------+------------+-------------+-------------+---------+
| Charles Stanley | - | - | 900,000 | - | 900,000 | 0.80% |
+-------------------+-----------+---------+------------+-------------+-------------+---------+
| Creditors through | 1,000,000 | 47.58% | - | - | 1,000,000 | 0.89% |
| CVA | | | | | | |
+-------------------+-----------+---------+------------+-------------+-------------+---------+
| Antony Batty | 182,585 | 8.69% | 365,170 | - | 547,555 | 0.49% |
+-------------------+-----------+---------+------------+-------------+-------------+---------+
| | | | | | | |
+-------------------+-----------+---------+------------+-------------+-------------+---------+
| TOTAL | 2,101,701 | 100.00% | 60,800,949 | 50,000,000 | 112,802,650 | 100.00% |
+-------------------+-----------+---------+------------+-------------+-------------+---------+
Business strategy of the Company following the Proposals
If the Resolutions are approved, following the GM, the Company would become an
investing company under the AIM Rules. The Company's proposed Investing Policy,
which is subject to shareholder approval, is set out below:
· The Company's proposed strategy is to participate in business that
specialises in the fields of financial products. In particular the Company will
focus on the life insurance settlement market, which involves the acquisition of
life insurance policies covering the life of one or more individuals with an
"ascertainable and limited" life expectancy. The policy owner is paid a lump
sum in cash in exchange for transferring the rights of ownership of the policy
to the buyer. The amount paid to the seller is calculated based on the specific
life expectancy of the underlying insured and may be stated as a percentage of
the policy's face amount. It intends to either acquire or invest in a company
or a business that owns or operates the trading platform or systems for the life
insurance markets and the Directors believe that such a transaction has the
potential to create value for Shareholders through the capital appreciation of
the investment over time and/or where appropriate through dividends. Such
investment will be actively managed and it is anticipated will be held for the
long term.
· The funds of the Company for the time being, including any additional
funding raised by the Company will be invested by means of the acquisition of
shares and other equity investment instruments or debt securities of the Company
and other corporate entities or directly by acquiring assets, licences or other
rights.
· The Company will seek targets whose growth prospects, if achieved, will be
earnings enhancing for Shareholders. The Company will appoint a director or
directors with the relevant knowledge experience and scope to add value to the
area in which the company intends to operate.
· The focus of its acquisition strategy will be in a number of areas
including the United Kingdom, Europe, United States of America and other
territories that have established exploration potential. However, given the
nature of the sectors which the Company will focus on, the Directors will
consider opportunities in other geographic locations should any such
opportunities arise.
· The Company may elect to raise further capital following the acquisition
either by way of equity or debt subject to the cash requirements appropriate for
growing the business the Proposed Directors would expect to offer the issue
shares in the Company in exchange for the acquisition of business and assets,
but would need to satisfy any requirement for cash consideration or future
funding of the resulting group by raising additional funding by means of placing
of shares in the Company and if required, by issuing debt securities or
incurring borrowings.
· The Company would consider cross holdings of shares and other equity
securities in circumstances that would benefit the broader strategy of the
investing policy.
· The Company would not contemplate investments or acquisitions that carried
a high degree of contingent risk or liability that is capable of imposing
financial obligations upon the Company that it could not reasonably expect to
meet. The Company would also not entertain investments or acquisitions that
would cause the Company to cease to be admitted to AIM or listed on any
comparable securities exchange.
· The Directors will adopt a strategy of seeking suitable acquisition and
investment opportunities by means of their connections and their expertise in
identifying and conducting such acquisitions. They may also engage advisers and
intermediaries to source suitable opportunities. The Directors have experience
in the conduct of comparable business and the Company is considered to have
sufficient available working capital to conduct the due diligence and other
preparatory work needed to conduct transactions of this kind. Acquisition
targets will be subject to the scrutiny of the Directors, some of whom have
experience in those sectors and in raising capital for companies.
If no substantial inroads have been made into the Company fulfilling its
investment strategy within 12 months of the date on which the trading assets of
the Group were sold, namely 4 November 2009, in accordance with the AIM Rules
for Companies, trading in the Company's Shares will be suspended and if the
Company's Investing Strategy is not implemented in the following six months,
cancelled.
Directors
The Directors expect to announce the appointment of at least one new director
with the appropriate standing and experience to support the implementation of
the Investing Strategy described above. Upon the appointment of a new Director,
Jamieson Ball and Christian Vaglio-Giors are expected to resign from office
without compensation for loss of office. Gary Truman will continue in office as
a Director, but he will cease to be an employee of the Company, without
compensation, and has agreed terms as a non-executive Director with effect from
the completion of the Proposals.
Change of Name
It is proposed that the name of the Company is to be changed to 'Insetco Plc'.
General Meeting
A General Meeting of the Company is to be held at 11.00 a.m. on 1 April 2010 at
which the Resolutions will be proposed to approve the CVA, to approve the
investing strategy, to give the Directors authority to issue the New Ordinary
Shares, to restructure the share capital and to change the name of the Company.
For further information please contact
ASG Media Plc
020 7831 1234
Gary Truman, Director
Charles Stanley Securities 020
7149 6000
Nominated Adviser
Russell Cook
Antony Batty & Company LLP 020 7831 1234
?
CVA Nominees
Antony Batty
DEFINITIONS
The following definitions apply throughout this announcement unless the context
requires otherwise:
+-----------------------+-------------------------------------------+
| "ADM" | ADM Investor Services International |
| | Limited, a company registered in England |
| | and Wales under Company No. 02547805, 4th |
| | Floor, Millennium Bridge House, 2 Lambeth |
| | Hill, London EC4V 3TT; |
| | |
+-----------------------+-------------------------------------------+
| "Administrators" | Antony Batty and Stephen John Evans of |
| | Antony Batty & Company LLP, in their |
| | capacity as the administrators of the |
| | Company appointed on 2 November 2009; |
| | |
+-----------------------+-------------------------------------------+
| "AIM" | AIM, a market operated by the London |
| | Stock Exchange Plc; |
| | |
+-----------------------+-------------------------------------------+
| "ASG Distribution" | ASG Distribution Limited, which has been |
| | formed by the Administrators to conduct |
| | the hive down of the residual assets and |
| | rights of the Company and to assume |
| | liability to its Creditors on the basis |
| | summarised in the CVA Proposal; |
| | |
+-----------------------+-------------------------------------------+
| "Articles of | the articles of association of the |
| Association" | Company; |
| | |
+-----------------------+-------------------------------------------+
| "Board" or | the directors of the Company; |
| "Directors" | |
+-----------------------+-------------------------------------------+
| "Business Strategy" | the investing strategy of the Company |
| | described in this announcement in the |
| | paragraph headed "Business Strategy of |
| | the Company following the Proposals"; |
| | |
+-----------------------+-------------------------------------------+
| "Capital | the proposed consolidation and |
| Reorganisation" | subdivision of the Existing Ordinary |
| | Shares, pursuant to the Resolutions as |
| | described in this announcement; |
+-----------------------+-------------------------------------------+
| "Charles Stanley" | Charles Stanley Securities a division of |
| | Charles Stanley & Company Limited, the |
| | Nominated Adviser of the Company; |
| | |
+-----------------------+-------------------------------------------+
| | |
+-----------------------+-------------------------------------------+
| "Circular" | the circular sent to shareholders on 16 |
| | March 2010 setting out details of the |
| | Proposals; |
| | |
+-----------------------+-------------------------------------------+
| "Convertible Notes" | the GBP50,000 convertible unsecured loan |
| | notes 2012 of the Company to be issued to |
| | ADM as described in this announcement; |
| | |
+-----------------------+-------------------------------------------+
| "Creditors" | existing creditors of the Company under |
| | the terms of the CVA; |
| | |
+-----------------------+-------------------------------------------+
| "CVA" | the proposed company voluntary |
| | arrangement of the Company as further |
| | described in this announcement and in the |
| | CVA Proposal; |
| | |
+-----------------------+-------------------------------------------+
| "CVA Proposal" | the proposal by the Administrators |
| | contained in the document dated 12 March |
| | 2010 issued by the Administrators to |
| | Creditors and Shareholders; |
| | |
+-----------------------+-------------------------------------------+
| "Deferred Shares" | deferred shares of GBP5.49999 each in the |
| | capital of the Company to be created |
| | pursuant to the Capital Reorganisation; |
| | |
+-----------------------+-------------------------------------------+
| "Enlarged Ordinary | the entire issued ordinary share capital |
| Share Capital" | of the Company consisting of the New |
| | Ordinary Shares in issue following the |
| | Capital Reorganisation, the New Ordinary |
| | Shares to be issued to Creditors under |
| | the CVA and the New Ordinary Shares to be |
| | issued to ADM and Antony Batty, as |
| | described in this announcement; |
| | |
+-----------------------+-------------------------------------------+
| "Existing Ordinary | the Ordinary Shares of GBP0.01 each in |
| Shares" | issue at the date of the GM; |
| | |
+-----------------------+-------------------------------------------+
| "General Meeting" or | the General Meeting of the Company |
| "GM" | convened for 11.00 a.m. on 1 April 2010 |
| | to approve the Resolutions, or any |
| | adjournment of the GM; |
| | |
+-----------------------+-------------------------------------------+
| "Former Subsidiaries" | ASL Media Limited, ADL Media Limited and |
| | Freelance Media Limited, wholly-owned |
| | subsidiaries of the Company that are to |
| | be divested as described in this |
| | announcement; |
| | |
+-----------------------+-------------------------------------------+
| "New Ordinary Shares" | ordinary shares of GBP0.00001 each in the |
| | capital of the Company following the |
| | Capital Reorganisation; |
| | |
+-----------------------+-------------------------------------------+
| "Notice" | the notice convening the GM issued by the |
| | Company on 16 March 2010; |
| | |
+-----------------------+-------------------------------------------+
| "Proposals" | the CVA, the Capital Reorganisation, the |
| | Resolutions and other proposals set out |
| | in this announcement; |
| | |
+-----------------------+-------------------------------------------+
| "Resolutions" | the ordinary and special resolutions to |
| | be proposed at the GM set out in the |
| | Notice; |
| | |
+-----------------------+-------------------------------------------+
| "Shareholders" | the holders of ordinary shares in the |
| | capital of the Company whether Existing |
| | Ordinary Shares or New Ordinary Shares; |
| | |
+-----------------------+-------------------------------------------+
| "Warrants" | the warrants in respect of up to |
| | 60,700,949 New Ordinary Shares |
| | exercisable at GBP0.001 per share to be |
| | issued as described in this announcement. |
+-----------------------+-------------------------------------------+
This information is provided by RNS
The company news service from the London Stock Exchange
END
MSCGIGDXLSXBGGG
Asg Media (LSE:ASG)
Historical Stock Chart
From Apr 2024 to May 2024
Asg Media (LSE:ASG)
Historical Stock Chart
From May 2023 to May 2024
