Craig & Rose PLC - Re Recommended Offers, etc.
July 20 1999 - 1:38PM
UK Regulatory
RNS No 7244q
CRAIG & ROSE PLC
20 July 1999
The following is text from a letter, posted today, to
Ordinary and Preference Stockholders by the Chairman of
Craig & Rose, Mr. J. Wightman:
" Dear Stockholder
Offer on behalf of Alaster Cunningham and cancellation of
listing
You may have received a letter from Andrew Perloff in
relation to the recent offers by Alaster Cunningham and the
intention to cancel the Company's listing.
Mr. Perloff has thought it appropriate to make the purchase
of shares as set out in his letter and has indicated his
intention to make further limited purchases. As a Board,
we feel it is necessary to clarify and correct certain of the
points raised by Mr. Perloff as follows:-
1. Mr. Perloff has chosen to describe Alaster Cunningham's
offer as a management buy out; in effect, Alaster
Cunningham's offers are designed to give to all of the
minority stockholders who may wish to take it an
opportunity of an exit prior to the Company cancelling
its listing. There would be no change to the
composition of the Board or the present controlling
shareholders as a result of the offer.
2. The asset value of the Ordinary Stock units has been
estimated by Mr. Perloff at #2.00. The Accounts of the
Company to 31 December 1998 give a going concern value
per Ordinary Stock Unit of approximately #1.95. However
it is clear to the Board that continuing to trade
on the existing basis from the Leith Walk site is not a
viable option for the future, and that relocating to
a new site, albeit with the attendant costs and financial
risks, is necessary if the Company is to go ahead to
develop its business as the Board thinks appropriate.
For these reasons the Board does not think this is an
appropriate way to value the Company.
3. Mr. Perloff refers to the Company owning three acres of
land in central Edinburgh; the Board would not agree
with Mr. Perloff's geography as it would seem difficult
to describe 2.83 acres in Leith as "Central Edinburgh";
4. Mr. Perloff states that the property has been "valued
without planning permission". In fact, the Company
appointed a reputable valuer with significant local
knowledge to report on its properties. As stated in
his report the valuer took into account uncertainty over
whether residential planning consent could be obtained in
arriving at his valuation and a copy of the report dated 9th
July 1999 is included in the Offer Document posted to stockholders
last week.
5. Mr. Perloff notes that it is proposed to acquire the
new site from a company owned by Alaster Cunningham at
a price of #240,000. This is #10,000 less than the
valuation contained in the report in the Offer Document
posted last week.
6. The family stockholders have had a long relationship
with the Company over several generations, and the
circumstances relating to the decision not to accept
the offer are quite different from these relating to
stockholders who hold shares purely as an investment.
7. The reasons for cancelling the listing are as set out
in the Offer Document. To sum up:
(a) the existing listing has not offered an active
market in either the Ordinary or Preference Stock;
(b) the listing does not in practice offer the Company
scope to raise new funds economically from the
public;
(c) the costs of compliance merely to maintain the
listing are disproportionate to the Company's size
and profits; and
(d) if the Company were to undertake even modest
transactions to increase its size, then this would
lead to substantially higher stock exchange
compliance costs in terms of listing.
Mr. Perloff is presumably aware that a significant and
increasing number of listed companies have chosen to
cancel their listing over the last six months; against
this background the Board does not share Mr. Perloff's
view that the Company's listing is a valuable asset,
and believes that the market as a whole would not agree
with him.
8. Stockholders, particularly those with a relatively
small number of shares, should note that Mr. Perloff's
offer to buy at 150p is likely to involve them in
paying brokers fees; they should consider whether the
costs of selling to Mr. Perloff might mean that the net
price received per share is in fact less than that
available under the Ordinary Offer, where the
consideration will be paid free from costs of dealing.
9. Finally the Board note that Mr. Perloff is not making
an offer available to all stockholders. The Board
would point out that the Offers from Alaster Cunningham
are open to all stockholders and give all stockholders
who wish one an exit, when the alternative is to remain
as stockholders in a company whose listing is about to
be cancelled.
Yours sincerely,
J. Wightman
The directors accept responsibility for the information
contained in this letter. To the best of their knowledge
and belief (having taken reasonable care to ensure that such
is the case) such information for which they accept
responsibility in this letter is in accordance with the
facts and does not omit anything likely to affect the import
of such information.
Except as specified in this letter in relation to the price
offered for Ordinary Stock by Mr. Perloff as at the date of
posting of this letter, there have been no material changes
in the information published in the Offer Document.
The Morton Fraser Partnership, Solicitors, of 19 York Place,
Edinburgh has approved this letter as an investment
advertisement solely for the purposes of section 57 of the
Financial Services Act 1986. The Morton Fraser Partnership
is authorised to conduct investment business by the Law
Society of Scotland under the Financial Services Act 1986. "
The following is text from a letter, posted today, to
Ordinary and Preference Stockholders by Alaster Cunningham:
"Dear Stockholder,
Offers for Craig & Rose plc ("the Company")
You may by now have received contact either by letter or
telephone from a Mr. Andrew S Perloff based at Mount
Pleasant in London regarding my recent offer to buy your
stock.
As stated in the offer document posted last week ("the Offer
Document") the main reason for my offers ("the Offers") was
specifically to give all stockholders who did not wish to be
stockholders in a small unlisted company which intends to
embark on a relatively high risk business strategy the
opportunity to sell their stock without costs.
Regrettably, due to Mr. Perloff's apparent lack of knowledge
of the Company's current financial position, I consider his
recent statements to be inaccurate and misleading. In
particular:
** It should be clear to Mr. Perloff and in fact to anyone
with an understanding of the workings of the Stock
Exchange, that a company with a turnover of #3,000,000,
and a market capitalisation (at the Offer Price) of
less than #1,000,000, is too small to be viable as a
listed entity.
** His comment that the listing is a valuable asset
ignores several years of your Board attempting to
extract value from the listing and the trend in recent
times which has seen an increasing number of "smaller
companies" (generally of a substantially greater size
than Craig & Rose) giving up their listings by way of
take-overs.
** Mr. Perloff has in my opinion mistakenly identified my
offer as a potential profit opportunity for himself and
has expressed a wish to acquire a strategic holding of
up to 29.9% in an attempt, I believe, to force me to
increase my offer for his stock.
I would like to remind you that the price I offered was
considered to be fair and reasonable by the Company's
independent advisers and I would confirm that I do not
intend to increase the terms of the Offers from the
current level.
** As outlined in the Offer Document, it is my intention
to proceed with the relocation of the Company,
involving funding of #2,200,000. At the time of the
rights issue referred to by Mr. Perloff, I invested
approximately #400,000 to help stabilise the Company; I
have previously waived fees due to me and I propose to
sell the new site to the Company for a price below its
open market valuation. These are signs of my commitment
to the Craig & Rose business. I do not know what Mr.
Perloff's intentions for the business and the employees
would be if he were to become a significant
shareholder.
** I would point out that Mr. Perloff is not making an
offer available to all stockholders. The Offers which
I am making are open to all stockholders and give all
stockholders an opportunity to exit, if they wish, from
a company whose listings are about to be cancelled.
Stockholders, particularly those with a relatively
small amount of stock, should note that Mr. Perloff's
offer to buy at 150p is likely to involve them in
paying brokers fees; they should consider whether the
costs of selling to Mr. Perloff might mean that the net
price received per stock unit is in fact less than that
available under the Ordinary Offer, where the
consideration will be paid free from costs of dealing.
I would ask those of you who were initially of a mind to
accept prior to receipt of Mr. Perloff's letter, to go ahead
and accept the Offers within the timescale of the Offer
Document as recommended to you by Bell Lawrie Wise Speke.
If you have any queries, please contact David Mitchell at
Dickson Minto W.S. at 11 Walker Street, Edinburgh, EH3 7NE,
or on 0131 225 4455.
Yours faithfully,
Alaster Cunningham
Alaster Cunningham accepts responsibility for the
information contained in this letter. To the best of his
knowledge and belief (having taken all reasonable care to
ensure that such is the case) such information for which he
accepts responsibility in this letter is in accordance with
the facts and does not omit anything likely to affect the
import of such information.
Save as disclosed in this letter, there have been, as at the
date of posting this letter, no material changes in the
information published in the Offer Document.
Dickson Minto W.S., of 11 Walker Street, Edinburgh EH3 7NE,
has approved this letter as an investment advertisement
solely for the purposes of Section 57 of the Financial
Services Act 1986. "
END
MSCSEWFWSUUUFFW
Corin Group Rfd (LSE:CRGR)
Historical Stock Chart
From Apr 2024 to May 2024
Corin Group Rfd (LSE:CRGR)
Historical Stock Chart
From May 2023 to May 2024
