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Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
---|---|---|---|---|---|
Abraxus Inv. | LSE:AXU | London | Ordinary Share | GB0008463787 | ORD 5P |
Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|---|---|
0.00 | 0.00% | 3.75 | 0.00 | 01:00:00 |
Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
---|---|---|---|---|---|
0 | 0 | N/A | 0 |
RNS Number:9161Z Abraxus Investments PLC 16 March 2006 16 March 2006 Abraxus Investments PLC (the "Company") Proposed sale of Hungarian Subsidiary On 6 March 2006, the Company announced that the Board had resolved to seek the sale of the Company's wholly owned subsidiary, First A.B. Kft (the "Subsidiary "). The Subsidiary owns the Podmaniczky hotel project in Budapest (the "Hotel Project") and is the Company's only material non-cash asset. The sale of the Subsidiary will result in the divestiture of all of the Company's current trading activities and pursuant to the AIM Rules requires the approval of the Company's shareholders by way of ordinary resolution. The sale of the Subsidiary will also result in the Company being classified as an "investing company" under the AIM Rules. Consequently the Company must seek shareholder approval of its future investing strategy. The Company has today posted to shareholders a circular containing notice of an Extraordinary General Meeting to be held at 3.00pm on 3 April 2006 at which resolutions will be proposed to (i) approve the sale of the Subsidiary and (ii) approve the Company's future investing strategy. Reasons for the sale As a result of ongoing disputes between groups of shareholders the Board has decided it is not practicable to progress the raising of equity share capital to fund further the Hotel Project. In addition, the Austrian bank which had previously given an "in principle" commitment to provide loan finance for development of the Hotel Project has confirmed that the facility would not be made available until such shareholder disputes were settled. The Board is of the view that these disputes are not capable of being resolved in the short term. While the Company's funds are anticipated to be adequate to meet all expenses, including budgeted expenditure on the Hotel Project through to the end of June, the Board believes that, without the certainty of a loan facility being available, the Company is not in a position to enter into new commitments with regard to the Hotel Project. In view of the situation outlined above, the Board has resolved that it is in the interests of the shareholders that the Company should seek to dispose of the Subsidiary. Terms of the sale The sale will be conducted by King Sturge Bradmore, an independent international firm of estate agents by way of public tender for cash. Shareholder approval is sought for a sale of the Subsidiary encompassing the following terms: i. a minimum cash consideration comprising #980,000 in respect of the Subsidiary's shares and #600,000 in discharge of outstanding loans due from the Subsidiary to the Company; ii. the assumption of all liabilities due to contractors engaged in the Hotel Project; iii. an open tender period of not less than 4 weeks to be advertised in Hungary and the United Kingdom; iv. completion of the sale on or before 31 July 2006; v. cash consideration to be paid in full in Pounds Sterling to be received by the Company within 14 days of the tender acceptance date; and vi. the giving of warranties by the Company (such as those concerning taxation and title to the Subsidiary's shares) limited to those that the Directors determine are reasonable and necessary to facilitate the sale of the Subsidiary. The Directors and their related parties have confirmed that they will not participate in the tender. In the event that a tender is not received based on the minimum terms set out above, shareholder approval will be sought for a sale based on the terms of the most favourable tender. Further information concerning the Subsidiary The Subsidiary has not been and is currently not involved in any other developments or projects. The hotel was acquired by the Subsidiary in early March 2005 for #917,000 (including acquisition costs). No profits are currently attributable to the Subsidiary. A sale at the minimum cash consideration has been calculated to (i) return to the Company its investment in the Subsidiary (ii) repay to the Company the outstanding loan of #600,000 due from the Subsidiary and (iii) cover selling costs which have been estimated at #60,000. Investing strategy following the proposed sale The proposed sale will divest the Company of its sole trading business activity, which will result in the Company being treated as an "investing company" under the AIM Rules. If a satisfactory sale is achieved the Subsidiary sale proceeds will be held on deposit pending discussions with major shareholders as to the Company's future direction. The Board hopes that these discussions will lead to a consensus that will allow the Company to raise additional equity funds to continue its stated strategy of actively identifying and pursuing international and UK commercial property development and investment opportunities that show an expectation of higher than average returns. If an appropriate way forward cannot be agreed within 30 days of the sale then the Board is of the view that existing funds should be returned to shareholders by way of a members' voluntary liquidation or otherwise. General Copies of the circular are available from the registered office of the Company at 2 Stone Buildings, Lincoln's Inn, London WC2A 3TH. Press enquiries: Westport Communications Tel: 020 7405 7777 Alan Frame This information is provided by RNS The company news service from the London Stock Exchange END DISJFMTTMMMBBIF
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