IG Design Group PLC Share Placing (0479F)

TIDMIGR

RNS Number : 0479F

IG Design Group PLC

25 July 2016

25 July 2016

IG Design Group plc ("IG Design" or "the Company")

Placing to raise GBP5.25 million

IG Design Group Plc, one of the world's leading designers, innovators and manufacturers, of gift packaging and greetings, social expression giftware, stationery and creative play products, today announces that it has raised GBP5.25 million (before expenses) by way of a placing of 3,000,000 new Ordinary Shares at a price of GBP1.75 pence per share. The Company has undertaken the Placing following strong institutional demand from both new and existing Shareholders.

As the Placing Shares represent only 5 per cent. of the existing Ordinary Shares in issue, they are being allotted using the Directors' existing authority to allot Ordinary Shares for cash on a non pre-emptive basis, as granted at the Company's most recent AGM.

Highlights

   --      Placing to raise gross proceeds of GBP5.25 million for the Company. 
   --      The net proceeds of the Placing, will be used to: 

- satisfy working capital requirements for the recent acquisition of Lang Companies Inc ("Lang");

- support a capital investment project to build the Group's capabilities in the UK to manufacture retail bags not for resale ('Retail Collateral'); and

- provide the Group flexibility to pursue opportunities to drive further growth whether strategic acquisitions or capital investment.

-- Strong support shown from both existing shareholders and new institutional investors, further diversifying the shareholder base and increasing the free float of the Company.

-- As set out in the Company's recent full year results the Company can confirm current trading remains strong and the Group's outlook remains unchanged. Due to the minimal dilution from the Placing, the Board is maintaining its existing earning per share expectations which were upgraded following the Lang acquisition.

Paul Fineman, Chief Executive Officer, commented:

"We are delighted to raise these funds, with the support shown by shareholders being a testament to the significant progress made within the business. The Company continues to build on its growing momentum following our strong results and recent re-brand, and alongside the acquisition of Lang, this Placing allows us to capitalise on opportunities to drive growth quickly and flexibly, be those organic capital investment or acquisitions.

"As the Group continues to evolve into a multi-category, design-focused and global business, we look forward to building on the strong foundations already in place, and achieve our vision of further profit growth underpinned by a unique blend of creativity and reliability."

Introduction and summary

The Company announces that it has raised GBP5.25 million (gross) by way of a placing of the New Shares with new and existing investors at the Placing Price. The Placing Price represents a discount of 4.8 per cent. to the Company's average mid-market closing price for the 5 business days preceding this announcement. The Placing is conditional on Admission.

Background to and reasons for the Placing

The Transaction is being undertaken to satisfy working capital requirements for the recent acquisition of Lang, completed in July, the design-led supplier of high-quality branded consumer indoor and outdoor home décor and lifestyle products, based in the USA.

In addition, the Company has also approved a capital project in the UK to manufacture 'Retail Collateral', defined as retail bags not for resale. The project, a natural extension of Design Group's product categories, is backed by a commercial agreement with an existing partner already in operating in the retail collateral domain. It complements existing manufacturing capabilities at the Company's factory in China.

Alongside these opportunities, the funds will be used to support the Group's pursuit of further strategic acquisitions and allow further capital investment in existing projects.

The Placing Agreement

Pursuant to the terms of the Placing Agreement, Cenkos, as agent for the Company, has conditionally agreed to use its reasonable endeavours to procure subscribers for the New Shares at the Placing Price and as agent for the Selling Shareholders to procure purchasers for the Sale Shares.

The Placing Agreement is conditional upon, inter alia, Admission becoming effective on or before 8.00 am on 28(th) July 2016 (or such later time and/or date as the Company and Cenkos may agree, but in any event by no later than 8.00am on 30 September 2016).

Settlement and dealings

Application will be made to the London Stock Exchange for the New Shares to be admitted to trading on AIM. It is expected that Admission will occur on 28 July 2016.

The New Shares will, when issued, rank in full for all dividends and other distributions declared, made or paid on the Ordinary Shares following Admission and otherwise pari-passu in all respects with existing Ordinary Shares.

Following Admission, the Company will have 62,280,833 Ordinary Shares in issue with voting rights. This figure is the number which may be used by shareholders as the denominator for the calculations by which they will determine if they are required to notify their interest in, or a change to their interests in, the Company under the FCA's Disclosure and Transparency Rules.

 
 
   Placing Statistics 
 
 Placing Price                                         GBP1.75 
 
 Number of Placing Shares                            3,000,000 
 
 Gross proceeds receivable by the Company      GBP5.25 million 
 
 Estimated proceeds receivable by the          GBP5.00 million 
  Company, net of expenses 
 
 Number of existing Ordinary Shares 
  in issue with voting rights                       59,280,833 
 
 Number of Ordinary Shares in issue 
  following Admission                               62,280,833 
 New Shares as a percentage of the existing       5.1 per cent 
  voting Ordinary Shares 
 
 

Expected timetable of principal events

 
 
 
 Announcement of the Placing               25 July 2016 
 
 Admission                                 28 July 2016 
 
 Where applicable, expected date           28 July 2016 
  for CREST accounts to be credited 
  in respect of Placing Shares 
  in uncertificated form 
 
 

Definitions

 
 "Admission"              the admission of to trading on 
                           AIM of the New Shares issued 
                           pursuant to the Placing, expected 
                           to be admitted to trading on 
                           AIM on 28(th) July 2016 
 "AIM"                    the market of that name operated 
                           by the London Stock Exchange 
 "AIM Rules"              the AIM Rules for Companies published 
                           by the London Stock Exchange, 
                           as amended from time to time 
 "Board" or "Directors"   the directors of the Company 
 "Cenkos"                 Cenkos Securities plc, the Company's 
                           nominated adviser and broker 
 "Company" or             IG Design Group plc, a company 
  "IG Design"              incorporated and registered in 
                           England and Wales with registered 
                           number 01401155, whose registered 
                           office is at IG Design Group 
                           plc, No 7 Water End Barns, Water 
                           End, Eversholt, Bedfordshire, 
                           MK17 9EA 
 "CREST"                  means the relevant system (as 
                           defined in the CREST Regulations) 
 "Group"                  the Company and its subsidiary 
                           undertaking undertakings from 
                           time to time 
 "New Shares"             means 3,000,000 new Ordinary 
                           Shares proposed to be issued 
                           by the Company and subscribed 
                           for pursuant to the Placing 
 "Ordinary Shares"        ordinary shares of 5p each in 
                           the capital of the Company 
 "Placing"                the placing of the Placing Shares 
                           pursuant to the Placing Agreement 
 "Placing Agreement"      the conditional agreement dated 
                           22(nd) July 2016 and made between 
                           Cenkos and the Company 
 "Placing Shares"         the New Shares and the Sale Shares 
 "Placing Price"          GBP1.75 per Placing Share 
 "Shareholders"           holders of Ordinary Shares 
 

For further information please contact:

   IG Design Group plc                                                           Tel: [phone] 

Paul Fineman, Chief Executive

Anthony Lawrinson, Chief Financial Officer

   Cenkos Securities plc                                                        Tel: [phone] 

Bobbie Hilliam (Corporate Finance)

Alex Aylen (Sales)

   Redleaf Communications                                                 Tel: [phone] 

Rebecca Sanders-Hewett

Sarah Fabietti

Susie Hudson

This information is provided by RNS

The company news service from the London Stock Exchange

END

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July 25, 2016 02:00 ET (06:00 GMT)