Richoux Group PLC Subscription (1619S)

TIDMRIC

RNS Number : 1619S

Richoux Group PLC

19 December 2016

Richoux Group plc

Subscription of 6,771,972 Ordinary Shares at a price of 25 pence per share

The Company today announces that it has raised approximately GBP1.69 million by way of a subscription (the "Subscription") of 6,771,972 new Ordinary Shares (the "Subscription Shares") at a price of 25 pence per Ordinary Share (the "Subscription Price"). The Subscription is conditional upon admission of the Subscription Shares to trading on the AIM market of the London Stock Exchange ("Admission").

The proceeds of the Subscription will be used for general working capital purposes.

Details of the Subscription

Following Admission, the Company will have 99,341,584 Ordinary Shares in issue and a market capitalisation of approximately GBP24.8 million at the Subscription Price. The Subscription Shares represent 6.8 per cent. of the issued ordinary share capital of the Company immediately following Admission. The Subscription Price is at a discount of 3.8 per cent. to the closing mid-market price per Ordinary Share on 16 December 2016, being the last dealing day prior to the announcement of the Subscription. Application will be made to the London Stock Exchange for the Subscription Shares to be admitted to trading on AIM and it is expected that Admission will occur on 22 December 2016.

The Subscription Shares 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. The Subscription is neither a rights issue nor an open offer and the Subscription Shares will not be offered generally to Shareholders on a pre-emptive basis. The Directors believe that the considerable extra cost and delay involved in a rights issue or open offer would not be in the best interests of the Company in the circumstances, and accordingly, the Board considers that it is in the best interests of the Company and Shareholders as a whole for the funds to be raised through the Subscription. The Subscription has not been underwritten.

Related party transactions

Jonathan Kaye, Mehdi Gashi, Salvatore Diliberto, The Hon. Robert Rayne, Phillip Kaye and Michinoko Limited (the "Related Parties") will each subscribe for Subscription Shares pursuant to the Subscription ("Related Party Subscriptions"). Each of the Related Parties is a "related party" of the Company (as defined by the London Stock Exchange's AIM Rules for Companies (the "AIM Rules")) by virtue of either being a Director or an existing substantial shareholder in the Company. The Related Party Subscriptions are, accordingly treated as "related party transactions" under the AIM Rules.

The number of Subscription Shares placed with Related Parties and their resultant shareholdings following the Subscription is set out below:

 
 Name             Role             Existing        % of        Subscription   Shareholding   % of 
                                    Shareholding    Existing    Shares         as at          issued 
                                                    Issued      subscribed     Admission      share 
                                                    Share       for                           capital 
                                                    Capital                                   as at 
                                                                                              Admission 
                  Chief 
 Jonathan          Executive 
  Kaye             Officer               625,000        0.7%      1,354,395      1,979,395         2.0% 
                  Executive 
 Mehdi Gashi       Director                    0        0.0%        400,000        400,000         0.4% 
 Salvatore        Non-Executive 
  Diliberto        Director           19,908,672       21.5%      1,054,394    20,963,066         21.1% 
 The Hon.         Non-Executive 
  Robert Rayne     Director           15,259,449       16.5%      1,054,394     16,313,843        16.4% 
 Phillip          Substantial 
  Kaye             shareholder        22,081,814       23.8%        451,465     22,533,279        22.7% 
 Michinoko        Substantial 
  Limited          shareholder        15,708,296       17.0%      1,054,394     16,761,690        16.9% 
 

Philip Shotter, being the independent Director not participating in the Subscription (the "Independent

Director"), considers, having consulted with Cenkos Securities plc, the Company's Nominated Adviser

for the purposes of the AIM Rules, that the terms of the Related Party Subscriptions with the Related

Parties are fair and reasonable insofar as the Shareholders are concerned.

Concert Party

Due to the close family link, Jonathan Kaye and members of his extended family being Phillip Kaye, Samantha Sanson, Sam Kaye and Adam Kaye are considered a concert party (collectively, the "Concert Party") for the purposes of Rule 9 of The City Code on Takeovers and Mergers.

Shareholders will be aware that on 15 November 2016 a General Meeting of the Company was held whereby a whitewash resolution concerning the waiver of obligations for the Concert Party under Rule 9 of the City Code was passed by means of a poll of Independent Shareholders (the "Waiver"). On the basis that the maximum number of new Ordinary Shares were issued to the Concert Party at that time, the Concert Party would have a maximum controlling position of approximately 41.3 per cent. in the enlarged share capital of the Company (assuming Jonathan Kaye acquires in full the 23,027,403 Ordinary Shares granted under his share incentive arrangements).

Following the Subscription, the Concert Party's Shareholding upon Admission and their Shareholding following Admission and assuming Jonathan Kaye acquires in full the 23,027,403 Ordinary Shares granted under his Share Incentive are exercised in full will be as follows:

 
 Registered       The Concert            Subscription   The Concert             The Concert 
  Holder           Party's                Shares         Party's beneficial      Party's beneficial 
                   existing               subscribed     interest in             interest in 
                   beneficial             for            the Company             the Company 
                   interest                              as at Admission         as at Admission 
                   in the Company                                                and assuming 
                                                                                 Jonathan Kaye 
                                                                                 acquires in 
                                                                                 full the 23,027,403 
                                                                                 Ordinary Shares 
                                                                                 granted under 
                                                                                 his Share Incentive 
                  Ordinary                              Ordinary Shares 
                   Shares 
                  Number       % of      Number         Number        % of      Number         % of 
                                voting                                 voting                   voting 
                                rights                                 rights                   rights 
 Phillip                          23.9 
  Kaye            22,081,814         %        451,465    22,533,279     22.7%     22,533,279     18.4% 
 Samantha 
  Sanson           1,123,706      1.2%              0     1,123,706      1.1%      1,123,706      0.9% 
 Jonathan 
  Kaye               625,000      0.7%      1,354,395     1,979,395      2.0%     25,006,798     20.4% 
 Sam Kaye            450,172      0.5%        451,465       901,637      0.9%        901,637      0.7% 
 Adam Kaye           290,171      0.3%        451,465       741,636      0.7%        741,636      0.6% 
 Total Concert 
  Party           24,570,863     26.7%      2,708,790    27,279,653     27.4%     50,307,056     41.1% 
 

In the event that Admission of the Subscription Shares in full does not occur, the Subscription will not proceed.

This announcement contains inside information.

19 December 2016

Enquiries

 
  Richoux Group plc          [phone] 
   Susan Ludley, Financial 
    Controller 
   Cenkos Securities 
    plc                       [phone] 
   Bobbie Hilliam 
 

This information is provided by RNS

The company news service from the London Stock Exchange

END

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December 19, 2016 02:00 ET (07:00 GMT)