European Wealth Group Limited CLS Update and Proposed Re-Financing (1736G)
May 25 2017 - 2:01AM
UK Regulatory
TIDMEWG TIDMEWGL
RNS Number : 1736G
European Wealth Group Limited
25 May 2017
European Wealth Group Limited
("European Wealth", or the "Group")
Convertible Loan Stock Update and
Proposed Re-Financing
European Wealth (AIM: EWG, EWGL), the integrated wealth
management group, announces that, further to the announcement on 10
February 2017, it is in advanced discussions regarding a
re-financing package that, once entered into and completed, will
re-structure the Group's balance sheet, enabling the repayment of
the GBP4.2m of quoted convertible loan stock issued by the Company
in 2014 ("CLS") and due for redemption on 9 June 2017 and all other
debts, accrued interest and deferred consideration ("Proposed
Fundraising"). Upon completion of the Proposed Fundraising, the
Group would be in a net positive cash position, leaving it well
capitalised to grow without the working capital constraints
previously referred to. Given the right financial structure, the
Board believes that the trading prospects of European Wealth remain
encouraging and are underpinned by strong momentum in assets under
management.
Proposed Fundraising
Under the terms of the Proposed Fundraising, two new external
investors will each subscribe for shares worth GBP3.1 million
(being GBP6.2 million in aggregate) in the Group. In addition to
this, these two investors will jointly underwrite an open offer
that will be made available to European Wealth shareholders and
employees to raise a further GBP3.1 million. In total, the Proposed
Fundraising would represent a re-financing of GBP9.3 million.
The price of the subscription and open offer will be at a
significant discount to the current market price with the result
that, on completion of the fundraising, the two new investors will
each hold a significant stake in the Group. This, together with the
anticipated appointment of their representatives on the Board of
the Group, means that the entry into a subscription and
underwriting agreement between the investors and the Group is
subject to certain regulatory pre-conditions and only once these
pre-conditions have been met, which could take a couple of months,
will the Company be able to enter into the subscription and
underwriting agreement. At which time, the Group will make a full
announcement as to the terms of the fundraising. The Proposed
Fundraising will also be subject to shareholder approval and a
circular will be posted to shareholders following the
announcement.
Bridge Financing
Due to the time required to obtain regulatory and shareholder
approval, it is not possible to complete the Proposed Fundraising
prior to the redemption of the CLS. However, one of the two new
investors has offered to provide a bridge financing facility to the
Group for GBP5.0m, which is sufficient to repay the CLS and all
accrued interest thereon. The Group anticipates agreeing, and
announcing, the full terms of the bridge financing, which will
include payment of interest on a monthly basis, by early June.
Shareholders should be aware that there is no guarantee that
either the bridge financing or the Proposed Fundraising will be
completed and if either does not proceed then the Group will need
to raise alternative finance in order to repay its debts.
Cancellation of CLS from admission
Unless an extension to the redemption date is approved by 90 per
cent. of CLS holders by value, the CLSs will be due for redemption
on 9 June 2017. As such, the Group has applied for a cancellation
of the CLS from admission as of 12 June 2017, as the CLS may no
longer be in existence at this date and therefore would be
incapable of being traded. A further announcement in respect of the
cancellation date will be made if appropriate.
Holders of the CLS should also note that today is the final date
to serve a notice for conversion of their CLS into ordinary shares
in European Wealth.
The information communicated in this announcement contains
inside information for the purposes of Article 7 of the Market
Abuse Regulation (EU) No. 596/2014.
For further details, please contact:
European Wealth Group Tel: +44 (0)20
Limited 7293 0733
John Morton www.europeanwealth.com
Tel: +44 (0)20
finnCap Ltd (Nomad 7220 0500
and Broker)
Adrian Hargrave
Scott Mathieson
FWD Consulting (Financial Tel: +44 (0)20 7280 0651
PR)
Elliot Lane
Gug Kyriacou
About European Wealth Group Limited
European Wealth Group Limited (AIM: EWG, EWGL) is the holding
company for the integrated wealth management business, European
Wealth Management Group Limited. Having commenced trading in 2010,
European Wealth has two operating divisions, European Investment
Management Limited ("EIM") and European Financial Planning Limited
("EFP"). Both are regulated by the FCA. EIM has opted for
Restricted Adviser status and EFP for Independent Adviser status.
Today the Group's head office is in London with an expanding
network of offices both in the UK and continental Europe. Core
services offered by the Group are financial planning, corporate
pension advisory and investment management in both equity and fixed
interest instruments. For further information on European Wealth's
wealth management and financial planning services, please go to
www.europeanwealth.com
This information is provided by RNS
The company news service from the London Stock Exchange
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