TIDMADS
RNS Number : 2633X
Alexander David Securities Grp PLC
13 February 2012
ALEXANDER DAVID SECURITIES GROUP PLC
("Alexander David" or the "Company")
POST CLOSE TRADING UPDATE,
ACQUISITION OF THE BUSINESS OF BRIDGE HALL STOCKBROKERS
LIMITED
AND ISSUE OF EQUITY
Trading Update
Alexander David today issues a trading update ahead of
announcing its final results for the year to 31 December 2011
("Full Year Report") on 23 April 2012.
In July, the Directors announced that Alexander David Securities
Group had, for the seven months to 31 July 2011, been trading
profitably, despite the slowdown in its markets disclosed in that
announcement. The Directors believe that in the final five months
of the year the slowdown became more severe for all operators in
the UK financial markets, particularly in the markets in which the
Company operates and as a result Alexander David Securities now
expects to show a loss for the full year to 31 December 2011.
Accordingly the Directors anticipate that they will report a
modest loss for the year, significantly below the loss for the year
to 31 December 2010. This loss is due to a number of factors but
the main reasons include reduced trading volumes and a smaller
number of corporate transactions in the last five months of the
year. Market conditions have also led to delays in completing
corporate transactions.
In a contrast to the end of the year, the first weeks of 2012
have shown some initial promise and we have a number of
transactions which are proceeding well, despite taking longer to
complete than anticipated. Looking forward, the Directors believe
that the Company should continue to benefit from its client base in
the equity markets and from its good pipeline of corporate
transactions. However, in the short term, the Directors believe it
to be vital to ensure that the Company remains well capitalised and
it has therefore raised a total of GBP350,000 by way of a placing
of Preference Shares and warrants to subscribe for new ordinary
shares, as further described below.
Acquisition of the business of Bridge Hall Stockbrokers
Limited
On 9 February 2012 Alexander David Securities agreed to acquire
the business of Bridge Hall Stockbrokers Limited ("BHSL") for a
total consideration of GBP30,000, which currently comprises 939
private clients and approximately GBP6m of client funds. BHSL is
now in liquidation and is no longer trading, and is no longer
authorised to offer clients any service.
This transaction will significantly increase the number of
clients available to Alexander David and its funds under advisory
management. For the sake of clarity, the Company has not taken on
any other liabilities or obligations from BHSL.
Placing
The Company has today placed, conditional upon shareholder
approval, GBP350,000 of Preference Shares, which qualify for FSA
tier one capital. The new Preference Shares will, when issued, rank
pari passu with the existing Preference Shares. The Preference
Shares will not be admitted to trading on any market.
In addition, the Company will issue to the same subscribers, in
proportion to their subscriptions, warrants to subscribe for
GBP350,000 of shares in the Company at an exercise price of 0.16p
per share. The subscribers are entitled to receive a fee of 1% per
calendar month to the value of the warrant at the exercise price.
The fee is payable so long as the warrants are not exercised, for a
period of 10 years from the date of issue. The warrants are over
218,750,000 new ordinary 0.1p shares in the Company.
The placing proceeds will provide additional working capital to
the Company to enable it to remain well capitalised. Certain of the
Directors, detailed below, participated in the Placing, which is
deemed to be a Related Party Transaction pursuant to AIM Rule 13.
The Directors who are independent of this transaction, being
Michael Hicks, Andrew Grant, Angus Rose and Alon Bull, consider,
having consulted with the Company's Nomad, Cairn Financial Advisers
LLP, that the terms of the placing are fair and reasonable insofar
as the Company's shareholders are concerned. Further details
relating to this are set out below.
The Warrants will, when exercised, rank pari passu with the
existing Ordinary Shares.
The Placing is subject to shareholder approval as it will
require a circular increasing the authorised number of Preference
Shares in issue. Such a circular will be sent to shareholders
shortly and a further announcement will be made when the circular
is posted.
Directors' Shareholdings
The following Directors of the Company have, as part of the
Placing, subscribed for Preference Shares of GBP1 each as set out
below. Their holdings before and after the Placing are also set out
below:
Director Current Current Preference Warrants Holding Holding
Preference Preference Shares to be following following
Share Share subscribed issued placing placing
holding holding for (no) (%)
(no) (%)
David
Scott 212,689 12.9 nil nil 212,689 10.3
------------ ------------ ------------ ----------- ----------- -----------
Sandra
Scott* nil nil 105,000 65,625,000 105,000 5.1
------------ ------------ ------------ ----------- ----------- -----------
Trevor
Coote 125,975 7.6 150,000 93,750,000 275,975 13.3
------------ ------------ ------------ ----------- ----------- -----------
Tony Cowling 143,405 8.7 20,000 12,500,000 163,405 7.9
------------ ------------ ------------ ----------- ----------- -----------
*Spouse of David Scott CEO
In addition, Trevor Coote has sold 31,250,000 ordinary shares to
Angus Rose at a price of 0.16p each. Following the sale, the
holdings of ordinary shares by Trevor Coote and Angus Rose is as
set out below:
Director Current Current Ordinary Holding Holding
holding holding share (sale)/purchase following following
(no) (%) transaction transaction
(no) (%)
Trevor Coote 101,399,650 13.7 (31,250,000) 71,149,650 9.6
------------ --------- ----------------------- ------------- -------------
Angus Rose 42,500,000 5.7 31,250,000 73,750,000 9.9
------------ --------- ----------------------- ------------- -------------
Enquiries:
Alexander David Securities Group plc Tel: +44 (0) 207 448 9800
Michael Hicks, Chairman
David Scott, Chief Executive
Nominated Adviser Tel: +44 (0) 207 148 7900
Cairn Financial Advisers LLP
James Caithie
This information is provided by RNS
The company news service from the London Stock Exchange
END
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