RNS Number : 5463M

SalvaRx Group plc

08 January 2019

SalvaRx Group plc

("SalvaRx" or the "Company")

Result of AGM and Completion of Disposal and Demerger

SalvaRx (AIM: SALV), the drug discovery and development company focused on cancer immunotherapy, is pleased to announce that at its Annual General Meeting held earlier today all resolutions set out in the Circular to shareholders dated 27 November 2018 ("the Circular") were duly passed.

Disposal of interest in SalvaRx Limited

Accordingly, shareholders have approved the sale of the Company's 94.2 per cent. interest in SalvaRx Limited to Portage Biotech Inc. ("Portage") in accordance with the terms of the Sale Agreement for a consideration of US$67.5 million, to be satisfied by the issue of 757,943,784 new shares in Portage (the "Consideration Shares") (the "Disposal").

The Company has been informed that all resolutions proposed at the Annual and Special Meeting of Portage held earlier today were approved, including the terms of the acquisition of the whole of the issued share capital of SalvaRx Limited.

Demerger Shares

Shareholders have also approved the transfer of 660,593,556 Consideration Shares (the "Demerger Shares") on a pro-rata basis to shareholders on the register on the Demerger Record Date (being 5.00 p.m. on 8 January 2019) (the "Demerger").

It is expected that definitive shares certificates in respect of the Demerger Shares will be despatched on or around 15 January 2019 (except to US Persons subject to safe-keeping and custody arrangements) and that definitive share certificates to be issued to US Persons in respect of Demerger Shares will be despatched following the expiry of the Restricted Period on or around 8 July 2019. During the Restricted Period, all Demerger Shares are subject to the Applicable Restrictions set out in the Circular.

Option Redemption and New Options

Following completion of the Disposal, the Company has completed the purchase of options over 2,767,470 new Ordinary Shares (the "Option Redemption") in consideration of the grant of new options over a total of 40,692,697 Consideration Shares (the "New Options"). The terms of the New Options are set out in the Circular.

Board changes

Denham Eke has been appointed as Chief Financial Officer and as a Director of the Company. Denham Hervey Newall Eke (aged 67) is Managing Director of Burnbrae Group Limited, a private international asset management company. He began his career in stockbroking with Sheppards & Chase before moving into corporate planning for Hogg Robinson Plc, a major multinational insurance broker. He is a director of many years' standing of both public and private companies involved in the financial services, property, mining, and manufacturing sectors. He is chairman of Webis Holdings Plc, chief executive officer of Manx Financial Group Plc, finance director of Port Erin Biopharma Investments Limited and a non-executive director of Billing Services Group Limited - all quoted on the AIM market. Mr Eke is also a non-executive director of Juvenescence Ltd., a leader in the development of therapies to slow, halt or potentially reverse aging. Additional information required to be disclosed in relation to Mr Eke pursuant to Schedule Two, paragraph (g) of the AIM Rules for Companies is set out in the Appendix.

Following the resignations of Dr Ian Walters, Kam Shah, Richard Armstrong and Colin Weinberg as directors of the Company with immediate effect from the conclusion of the AGM, the Board now comprises Jim Mellon (Non-executive Chairman), Dr. Greg Bailey (Non-executive Director) and Denham Eke (Chief Financial Officer). As a result, the Board has no independent directors. However, the Directors are in the advanced stages of recruiting an independent non-executive director and the Company expects to provide an update on the progress of such appointment in due course.

AIM Rule 15 cash shell

The Disposal and the Demerger constitute a fundamental change of business under Rule 15 of the AIM Rules. Following the Disposal and the Demerger, the Company has ceased to own, control or conduct all, or substantially all, of its existing trading business activities or assets. It is therefore classified as an AIM Rule 15 cash shell and as such is required to make an acquisition or acquisitions which constitutes a reverse takeover under AIM Rule 14 (or seek re-admission as an investing company (as defined under the AIM Rules)) on or before the date falling six months from completion of the Disposal and the Demerger (namely by 9 July 2019), failing which the Company's Ordinary Shares would then be suspended from trading on AIM pursuant to AIM Rule 40. Admission to trading on AIM would be cancelled six months from the date of suspension should the reason for the suspension not have been rectified.

In order to meet its working capital requirements as an AIM Rule 15 cash shell, the Company has retained 56,657,531 Consideration Shares (the "Retained Shares") as a means of increasing its cash reserves amounting to approximately US$50,000 (after meeting the expected costs of the Disposal and the Demerger). Based on the Portage share price of US$0.105 on the CSE at the close of business on 7 January 2019, the Retained Shares are valued at approximately US$5.95 million (GBP4.65 million at an exchange rate of GBP1: US$1.278). The number of Retained Shares may increase by up to 40,692,697 Consideration Shares to the extent that New Options remain unexercised by 5.00 p.m. on 8 January 2020. In the event that the cash reserves and any value realised from the Retained Shares are insufficient to meet the Company's working capital requirements, the Directors may seek further funding, including by a further issue of Ordinary Shares.

Jim Mellon, chairman of SalvaRx Group plc, commented, "Completion of the Disposal and the Demerger provides the opportunity to unlock and maximise value for the Company's shareholders as well as to secure the funding which SalvaRx Limited requires to support the businesses forming part of its portfolio, to develop clinical proof of concept in cancer immunotherapies and, in addition, to undertake further investments in and/or acquisitions of businesses which are complementary to its portfolio. Through their holding of Demerger Shares, shareholders are able to retain an interest in the ongoing development of the assets in that portfolio. In addition, through their holding of Ordinary Shares, shareholders are also able to retain an exposure to the potential upside of the Company's development as an AIM Rule 15 cash shell.

"We welcome Denham to the Company's Board. He is a valuable addition to the team and his experience will be highly relevant as we look to identify a suitable acquisition for the Company as an AIM Rule 15 cash shell."

This announcement should be read in conjunction with the full text of the Circular which is available on the Company's website at https://www.salvarx.io/investors/aim-rule-26.html. Capitalised terms in this announcement have the same meaning as given in the Circular.

This announcement contains inside information for the purposes of Article 7 of Regulation (EU) 596/2014.


 SalvaRx Group plc 
 Denham Eke, Chief Financial Officer            Tel: +44 (0) 01624 
 Northland Capital Partners Limited           Tel: +44 (0) 20 3861 
  Nominated Adviser and Broker                                6625 
 Matthew Johnson / Edward Hutton (Corporate 
 Vadim Alexandre (Corporate Broking) 
 Peterhouse Capital Limited                   Tel: +44 (0) 20 7469 
  Joint Broker                                                0932 
  Lucy Williams / Duncan Vasey 


Additional information required to be disclosed in relation to Mr Eke pursuant to Schedule Two, paragraph (g) of the AIM Rules for Companies is set out below.

                          Current Directorships 
 Achte CRSR & Co KG                     Dundrennan Limited 
 Albany Management Limited              ECF Asset Finance PLC 
 Albany SIAG Development GbR            Edgewater Associates Limited 
 Albany SIAG Gerwerbe 1 GbR             European Collateral Finance 
 Albany SIAG Gerwerbe 11 GbR            European Corporate Finance 
 Albany SIAG Gerwerbe 111 GbR           European Leasing Limited 
 Albany SIAG Wohnen 1 GbR               European Wagering Services 
 Albany SIAG Wohnen 11 GbR              Fuenfte CRSR & Co KG 
                                         Galloway Limited 
                                         Genseq Limited 
 All Star Leisure (Group) Limited 
 Arundel Services Limited 
 B.E. Global Services Limited           Horsfield Limited 
 betInternet.com (IOM) Limited          IC Technology (UK) Limited 
 betInternet.com NV                     Indigo Securities Limited 
 Big Group plc                          Juvenescence AI Limited 
 BigSave Limited                        Juvenescence Limited 
 Billing Service Group Limited          Juvenescence UK Limited 
 BMIP Limited                           Juvent Holdings Limited 
 Bradburn Limited                       KG Antell (SIAG 16) KG 
 Bradda Head Holdings Limited           Mann Bioinvest (BVI) Limited 
 Bradda Head International Limited      Mann Bioinvest Limited 
 Burnbrae Belgium Limited               Mann Pathfinder IC 
 Burnbrae Charlottenburg GmbH           Manx Financial Group plc 
 Burnbrae Commercial GmbH               Manx Financial Limited 
 Burnbrae Development GmbH              Manx Incahoot Limited 
 Burnbrae East GmbH                     Master Investor Limited 
 Burnbrae Events Limited                Mediqventures Limited 
 Burnbrae Friedrichstein GmbH           Navrona Investments Limited 
 Burnbrae Germany East GmbH             Neunte CRSR & Co KG 
 Burnbrae Germany GmbH                  Pathfinder Advisors Limited 
 Burnbrae Germany North GmbH            Podenco Distribution Limited 
 Burnbrae Germany South GmbH            Podenco Evissa Distribution 
 Burnbrae Germany West GmbH             Podenco Global Limited 
 Burnbrae Group Limited                 Port Erin Biopharma Investments 
 Burnbrae Kreutzberg GmbH               SCI Burnbrae Paris 
 Burnbrae Limited                       Scotsdale Properties Limited 
 Burnbrae Lutzowstrasse GmbH            Sechste CRSR & Co KG 
 Burnbrae Media Holdings Limited        Shellbay Investments Limited 
 Burnbrae Media Investments Limited     Sleepwell Aviation Limited 
 Burnbrae Media Services Limited        Sleepwell Construction Management 
 Burnbrae Mitte GmbH                    Sleepwell Hotels (UK) Limited 
                                         (Isle of Man) 
 Burnbrae Prenlauer Berg GmbH           Sleepwell Hotels (UK) Limited 
 Burnbrae Residential GmbH              Sleepwell Hotels Limited 
 Burnbrae Sachsen GmbH                  Softline Distribution Limited 
 Burnbrae Schonefeld GmbH               Softline Limited 
 Burnbrae Spain SL                      Softline UK Limited 
 Burnbrae Spandau GmbH                  Stonehaven Properties Limited 
 Burnbrae Style Limited                 Technical Facilities & Services 
 Burnbrae Tempelhof GmbH                Teviot Company Limited 
 Burnbrae Tiergarten GmbH               The Executive Club Limited 
 Burnbrae Wedding GmbH                  Transbank Card Services Limited 
 Burnbrae Wilmersdorf GmbH              Transbank Limited 
 Burrow Head Limited                    TransSend Card Services Limited 
 Calabrese Holdings Limited             TransSend Holdings Limited 
 Chester House Property Limited         TransSend Payments Limited 
 Clean Air Capital Limited              Troon Properties Limited 
 Clean Air Capital Services Limited     Watch&Wager.com Limited 
 Conister Bank Limited                  Watch&Wager.com LLC 
 Conister Card Services Limited         Webis Holdings plc 
 Corporate Asset Finance Limited        Wielandstrasse 5 Objekt GmbH 
 CRSR GmbH & Co KG                      Zweite CRSR & Co KG 
                        Past Directorships 
                     (in the last five years) 
 Spreadbet Magazine Limited   Speymill Property Group (UK) 
 Oilbarrel.com Limited        Speymill plc 
 Sharecrazy.com Limited       Rivington Street Holdings plc 
 ARBB AG                      OKYO Pharma Limited (formerly 
                               West African Minerals Corporation) 

On 3 September 2015, Speymill plc, a company of which Denham Eke was a director at the time, entered into a voluntary liquidation and was subsequently dissolved on 6 July 2017. Mr Eke was also a director of subsidiary company Speymill Contracts Limited within one year of it entering into administration on 16 December 2012 and a director of Speymill Property Group (UK) Limited which entered into voluntary liquidation on 25 January 2016. The combined creditors of Speymill plc and its subsidiaries were owed approximately GBP4.3 million, of which Galloway Limited, a company of which Denham Eke is a director, was owed GBP3.9 million.

On 29 January 2014, Rivington Street Holdings plc, a company of which Denham Eke was a director at the time, entered into a voluntary liquidation and was subsequently dissolved on 20 October 2017. The combined creditors of the company and its subsidiaries were owed approximately GBP4.0 million, of which Galloway Limited, a company of which Denham Eke is a director, was owed GBP3.8 million.

Interests in the Company

Mr Eke has no direct shareholding in the Company.

Mr Eke is the sole director of Galloway Limited which holds 370,370 Ordinary Shares (representing approximately 1 per cent. of the Company's issued share capital). Galloway Limited is indirectly wholly owned by the trustee of a settlement under which James Mellon has a life interest.

There is no other information that is required to be disclosed with regards to the appointment of Mr. Eke pursuant to Schedule 2 paragraph (g) of the AIM Rules for Companies.

This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact rns@lseg.com or visit www.rns.com.



(END) Dow Jones Newswires

January 08, 2019 11:15 ET (16:15 GMT)

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