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Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
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Ath Resources | LSE:ATH | London | Ordinary Share | GB00B013H730 | ORD 0.5P |
Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
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0.00 | 0.00% | 0.325 | 0.00 | 01:00:00 |
Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
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0 | 0 | N/A | 0 |
RNS Number:0796M ATH Resources plc 10 May 2005 Press Release 10 May 2005 ATH Resources plc ("ATH Resources" or "the Group") Acquisition of the Grievehill and Glenmuckloch Opencast Coal Sites Open Offer of 9,923,392 New Ordinary Shares at 170 pence per share on the basis of 1 New Ordinary Share for every 3 Existing Ordinary Shares ATH Resources plc, one of the UK's largest coal producers, announces today that the Group proposes to raise approximately #16.8 million (net of expenses) by way of an Open Offer of 9,923,392 New Ordinary Shares and plans to use the proceeds to acquire two opencast coal sites in Scotland. The Open Offer is fully underwritten by Seymour Pierce Limited. Highlights * Raising #16,869,766 before expenses by way of an Open Offer of 9,923,392 New Ordinary Shares at a price of 170p per New Ordinary Share. * Open Offer on the basis of 1 New Ordinary Share for every 3 Existing Ordinary Shares. * Acquisition of the Grievehill and Glenmuckloch open cast coal sites from The Scottish Coal Company Limited for a consideration of #18 million. * Grievehill and Glenmuckloch coal sites contain in aggregate an estimated 4.1 tonnes of proven and probable reserves of coal. * Open Offer is fully underwritten by Seymour Pierce Limited. * Open Offer is conditional on the passing of Resolutions to be proposed at the EGM and on Admission. Commenting on the Open Offer and the Acquisitions, Tom Allchurch, Chief Executive of ATH Resources, said: "This acquisition increases the Group's reserve base by over 160% and provides the business with longer term stability while we continue to develop our own new mines. We believe that this open offer presents investors with an excellent follow-on investment opportunity which both strengthens and speeds up the growth and development of the Group." For further information: ATH Resources plc Tom Allchurch, Chief Executive Tel: +44 (0) 1302 760 462 tom@ath.co.uk www.ath.co.uk Seymour Pierce Limited Sarah Wharry, Corporate Finance Tel: +44 (0) 207 107 8000 sarahwharry@seymourpierce.com www.seymourpierce.com Media enquiries: Abchurch Henry Harrison-Topham / Charlie Jack Tel: +44 (0) 20 7398 7700 henry.ht@abchurch-group.com www.abchurch-group.com The following information has been extracted without material adjustment from the Prospectus to ATH Resources Shareholders dated 10 May 2005 containing details of the Acquisition and Open Offer (the "Prospectus"). Introduction ATH Resources announces today that the Company proposes to raise up to #16,869,766 (before expenses) by way of an Open Offer of 9,923,392 New Ordinary Shares at the Issue Price. The Open Offer has been fully underwritten by Seymour Pierce and is being made on the basis of 1 New Ordinary Share for every 3 Existing Ordinary Shares held by Qualifying Shareholders at the Record Date. The Open Offer is conditional, inter alia, on the passing of the Resolutions to be proposed at the EGM, satisfaction of all conditions precedent to completion of the Acquisitions (save for Admission) and on Admission. The Company will use the net proceeds of the Open Offer, expected to amount to approximately #16 million, towards the consideration for the proposed acquisition of two opencast coal sites, Grievehill and Glenmuckloch, situated in south-west Scotland, further details of which are set out in this announcement. Background The Ordinary Shares of ATH were admitted to trading on AIM on 11 June 2004. The principal business of the Group is the operation of opencast coal sites in the UK. The Company raised #11.25 million net of expenses on its admission to trading on AIM. These funds were used to repay approximately #9 million of debt within the business, with the remainder being used as working capital for the development of the Group's business. The Acquisitions The Group through one of its subsidiaries has entered into a conditional agreement with The Scottish Coal Company Ltd ("SCC") to acquire from it two opencast coal sites at Grievehill and Glenmuckloch containing in aggregate an estimated 4.1 million tonnes of proven and probable reserves of coal for a consideration of #18 million. The completion of the Acquisition Agreement is conditional, inter alia, on the following conditions precedent having been satisfied prior to 3 June 2005 (or having been waived by the Company): i. completion of due diligence to the satisfaction of the Company; ii. the assignment or grant of appropriate leases and licenses in relation to the Acquisitions; and iii. Admission The agreement and ancillary documents relating to the Acquisitions provide for the sale and purchase of freehold land, the assignment of leases and the transfer of consents to operate the Grievehill and Glenmuckloch sites. Further terms of the Aquistions are set out in the Prospectus. Grievehill The Grievehill site is located in the County of East Ayrshire, approximately 8km south east of the town of Cumnock and adjacent to the Company's existing Garleffan site. It encompases approximately 118 hectares in total and contains an estimated 1.3 million tonnes of proven and probable reserves of coal. The Group already has an option to lease part of the site and on completion of the Acquisitions will acquire the freehold of the remainder using part of the proceeds of the Open Offer. Geology Approximately 300 boreholes have been drilled within the site area and its immediate vicinity by the former British Coal Corporation. This covers approximately 95 per cent. of the site with closely spaced drilling. The area has been mined previously by underground methods and by some shallow opencasting, and this has been allowed for in the reserve assessments. The Group intends to mine 10 seams at the site. Planning The site has the benefit of a planning permission ready for issue, along with the necessary environmental permissions and consents issued by the Scottish Environmental Protection Agency, in respect of water discharges and dust control at the site. Further details of the planning permission and other environmental permissions and consents are set out in the Independent Geologist's Report contained in the Prospectus. Production plan The Group intends to commence operations at Grievehill during the summer of 2005 with a view to commencing coal production in October 2005. One new O&K RH120E excavator on backhoe configuration will be ordered, with delivery anticipated for August 2005, and the site will also utilise equipment from the Group's adjacent Garleffan site. Coal from Grievehill will be processed at the existing Garleffan facility and transported to the Group's Crowbandsgate rail loading point, from where it will be dispatched to customers. The majority of coal from both sites will be sold into existing and (when agreed) new electricity generator contracts. In order to add value, some coal will also be used to supply industrial and housecoal markets after preparation at the Group's Skares Road site. The site is expected to produce coal for approximately two years, during and after which the Group intends that it will be restored to low grade agricultural and wildlife uses. Glenmuckloch The Glenmuckloch site is located approximately 15 km south-east of Cumnock and 7 km south-east of Grievehill. The site comprises approximately 216 hectares of agricultural grassland, some woodland and wet heathland. The Carlisle to Kilmarnock railway line is located adjacent to the southern boundary, with the A76 some 800m further to the south. On completion of the Acquisitions, the Group will acquire the freehold interest in approximately 70 per cent. of the surface of the site and options to lease the remainder will be assigned. These interests will be paid for by the Group using part of the proceeds of the Open Offer. Geology The site was extensively drilled by the former British Coal Corporation in the 1980s and SCC has drilled approximately 30 additional boreholes since 2002. A total of some 780 boreholes have been drilled within and immediately adjacent to the site area. Almost all the boreholes have been geophysically logged to provide good quality seam thickness data. The Group intends to work 17 coal seams at the site to recover an estimated 2.8 million tonnes of proven and probable coal reserves. Planning The site has planning permission, along with the necessary environmental permissions and consents issued by the Scottish Environmental Protection Agency, in respect of water discharges and dust control at the mine. Further details of the planning and other environmental permissions and consents are set out in the Independent Geologist's Report contained in the Prospectus. Production Plan Production is not planned to commence at Glenmuckloch until 2006. It is intended that new excavation equipment will be ordered shortly after completion of the Acquisitions for delivery in spring 2006, and that coal will be processed on site at Glenmuckloch to service existing and (when agreed) new electricity generator contracts and also to supply industrial and housecoal markets. The Group is currently investigating the possibility of obtaining a Freight Facilities Grant to assist with the construction cost of a new rail loading facility adjacent to the site. If this option is not financially viable, the coal will be taken by road to the Group's rail loading point at Crowbandsgate for dispatch to the customers. The Group intends to start work on site preparation in March 2006 and has scheduled coal production to start in July 2006. The Group has planned the output to be approximately 615,000 tonnes per annum and coal production at the site is expected to last around four and a half years. Principal terms of the Open Offer The Company proposes to issue 9,923,392 New Ordinary Shares pursuant to the Open Offer at the Issue Price which will raise #16,869,766 for the Company (before expenses). Seymour Pierce has underwritten the Open Offer. The Prospectus comprises a letter from Seymour Pierce, inviting Qualifying Shareholders to apply for New Ordinary Shares at the Issue Price under the Open Offer. The Open Offer is being made by Seymour Pierce as agent for the Company to Qualifying Shareholders on the basis of: 1 New Ordinary Share for every 3 Existing Ordinary Shares held at the Record Date and so on in proportion for any other number of Existing Ordinary Shares held. Where appropriate, the entitlement of Qualifying Shareholders will be rounded down to the nearest whole number of New Ordinary Shares and any fractional entitlements will be aggregated and sold for the benefit of the Company. The New Ordinary Shares will, when issued and fully paid, rank pari passu in all respects with the Existing Ordinary Shares of the Company and will rank in full for all dividends and other distributions thereafter declared, made or paid on the share capital of the Company. Seymour Pierce, as agent for the Company, has conditionally agreed to use its reasonable endeavours to place firm at the Issue Price 5,323,071 New Ordinary Shares, for which irrevocable undertakings have been given by the Directors and certain other Shareholders not to take up their entitlement under the Open Offer, together with any aggregated fractional entitlements to New Ordinary Shares and the New Ordinary Shares not being offered to overseas Shareholders under the Open Offer, with its institutional and other clients. If valid Applications Forms are not received for all of the New Ordinary Shares, such number of New Ordinary Shares not so applied for will be subscribed at the Issue Price by placees procured by Seymour Pierce, so agent for the Company. To the extent that any such New Ordinary Shares are not so placed, Seymour Pierce will, as underwriter, subscribe for them on the terms and conditions of the Underwriting Agreement. Qualifying Shareholders will receive with the Prospectus an Application Form containing details of their entitlement to subscribe for New Ordinary Shares. To be valid, completed Application Forms and payment in full must be received by the Company's receiving agent, Capita Registrars, Corporate Actions, PO Box 166, The Registry, 34 Beckenham Road, Beckenham, Kent BR3 4TH by 3.00 p.m. on 1 June 2005. The Open Offer is conditional, inter alia, on the passing of the Resolution to be proposed at the EGM, satisfaction of all conditions precedent to completion of the Acquisitions (save for Admission), Admission and the Underwriting Agreement becoming unconditional in all respects (save for Admission). It is expected that dealings in the New Ordinary Shares will commence on AIM at 8.00 a.m. on 3 June 2005 (or such later time and date as shall be determined by Seymour Pierce and the Company, being not later than 15 June 2005). If Admission has not so occurred, application monies will be returned to applicants without interest as soon thereafter as is practicable. Further information on the Open Offer, including the procedure for application and payment, is set out in the letter from Seymour Pierce in the Prospectus and in the Application Form. The attention of Overseas Shareholders is drawn specifically to the section entitled "Overseas Shareholders" contained in the Prospectus. Directors intentions The Directors are intending to take up part of their entitlement to the New Ordinary Shares under the Open Offer in respect of an aggregate of 59,290 New Ordinary Shares. Each Director has signed an irrevocable undertaking to the Company and to Seymour Pierce to that effect. Seymour Pierce has conditionally agreed to use its reasonable endeavours to place the New Ordinary Shares in respect of which the Directors' do not take up their entitlements with its institutional and other clients. Current trading and prospects Trading for the first half of the current financial year, although better than for the same period in the previous financial year, has been below Directors' expectations. This follows an exceptionally wet winter which slowed coal production in the first four months of the financial year. The Group has taken steps to increase production with additional excavators being installed at the Garleffan and Skares Road sites and trading for the second half of the current financial year is expected to show a significant improvement. Extraordinary General Meeting The Open Offer is conditional on, inter alia, the approval of the Resolutions by Shareholders which is to be sought at an EGM convened for 10.00 a.m. on 2 June 2005 for which a notice is set out in the Prospectus. At this meeting the following special resolution will be proposed: 1. That: 1.1 the Directors be authorised pursuant to section 80 of the Act to allot New Ordinary Shares up to an aggregate nominal value of #99,233.92, such authority to expire at the conclusion of the Annual General Meeting of the Company to be held in 2006; and 1.2 the statutory pre-emption rights contained in section 89 of the Act be disapplied in relation to the allotment of equity securities for cash, up to an aggregate nominal amount of #49,616.96 for the purpose of the Open Offer, in connection with any offer by way of rights in the future, and otherwise up to an aggregate nominal amount of #9,923.39, such authority to expire at the conclusion of the Annual General Meeting of the Company to be held in 2006. Availability of the admission document Copies of the admission document dated 10 May 2005 are available free of charge from the Company's registered office and at the offices of Seymour Pierce Limited, Bucklersbury House, 3 Queen Victoria Street, London, EC4N 8EL, during normal business hours on any weekday (Saturdays, Sundays and public holidays excepted) and will remain available for at least one month after Admission. Open Offer details Issue Price 170 pence Number of New Ordinary Shares being issued 9,923,392 Number of Ordinary Shares in issue immediately following Admission 39,693,568 Percentage of the Enlarged Share Capital represented by the New Ordinary Shares 25% Market capitalisation at the Issue Price #67.5 million Gross proceeds of the Open Offer #16,869,766 Estimated net proceeds of the Open Offer #16,000,000 Expected timetable of principal events Record date for Entitlement under the Open Offer 5 May 2005 Prospectus available 10 May 2005 Latest time and date for splitting of Application 3.00 p.m. on 27 May 2005 Forms to satisfy bona fide market claims under the Open Offer Latest time and date for receipt of Forms of Proxy 10.00 a.m. on 31 May 2005 for the EGM Latest time and date for receipt of completed 3.00 p.m. on 1 June 2005 Application Forms and payment in full under the Open Offer EGM 10.00 a.m. on 2 June 2005 Admission and commencement of dealings in New 3 June 2005 Ordinary Shares Delivery of New Ordinary Shares into CREST accounts 3 June 2005 Despatch of definitive share certificates (where By 10 June 2005 applicable) by Application forms are personal to the Qualifying Shareholder named thereon. The Application Form represents a right to apply for New Ordinary Shares. It is not a document of title and may not be sold, assigned or transferred, except to satisfy bona fide market claims in relation to purchases of Ordinary Shares through the market prior to the ddate on which the Existing Ordinary Shares are marked "ex" the entitlement to particpate in the Open Offer pursuant to the Rules of the London Stock Exchange. Definitions The following definitions apply throughout this announcement, unless the context otherwise requires: "Aardvark TMC" Aardvark TMC Limited, a subsidiary company of ATH "Act" the Companies Act 1985 (as amended) "Acquisitions" The proposed acquisitions by ATH of the Grievehill and Glenmuckloch open cast coal sites "Acquisition Agreement" The agreement dated 6 May 2005 between the Aardvark TMC and The Scottish Coal Company Ltd relating to Acquisitions "Admission" the admission of the New Ordinary Shares to trading on AIM becoming effective in accordance with the AIM Rules "AIM" a market operated by London Stock Exchange plc "AIM Rules" the rules of London Stock Exchange plc governing admission to and the operation of AIM "Alchemy Partners" Alchemy Partners LLP of 20 Bedfordbury, London WC2N 4BL "The Alchemy Plan" the discretionary funds managed by Alchemy Partners (Guernsey) Limited with advice from Alchemy Partners "Application Form" the application form to be used by Qualifying Shareholders in connection with the Open Offer "Approved Scheme" means the Inland Revenue approved executive share option scheme adopted by ATH on 7 June 2004, further details of which are given in the Prospectus "Acquisitions" the acquisitions by ATH of the Grievehill and Glenmuckloch open cast coal sites "Articles" the articles of association of the Company adopted on 7 June 2004 "ATH" or "Company" ATH Resources plc "Capita Registrars" a trading division of Capita IRG Plc "CREST" the relevant system (as defined in the CREST Regulations) for paperless settlement of share transfers and the holding of shares in uncertificated form which is administered by CRESTCo "CRESTCo" CRESTCo Limited "CREST Regulations" the Uncertificated Securities Regulations 2001 "Directors" or the "Board" the directors of the Company, whose names appear on page 3 of the Prospectus "EGM" the extraordinary general meeting of the Company convened for 10.00 a.m. on 2 June 2005, notice of which is set out at the end of the Prospectus "Enlarged Share Capital" the Existing Ordinary Shares and the New Ordinary Shares "Existing Ordinary Shares" the Ordinary Shares in issue at the date of the Prospectus "Form of Proxy" the form of proxy accompanying this document for use by Shareholders in connection with the EGM "Group" or "ATH Group" ATH and its subsidiary undertakings "Issue Price" 170 pence per New Ordinary Share "LTIP" the long term incentive plan adopted by ATH on 7 June 2004, further details of which are set out in the Prospectus "Industry" the coal mining industry in the UK "New Ordinary Shares" the 9,923,392 new Ordinary Shares to be issued by the Company pursuant to the Open Offer "Open Offer" the open offer of the New Ordinary Shares as set out in the Prospectus "Options" options or awards over Ordinary Shares granted pursuant to the Share Option Schemes "Ordinary Shares" ordinary shares of 0.5 pence each in the capital of the Company "POS Regulations" the Public Offers of Securities Regulations 1995 (as amended) "Qualifying Shareholders" holders of Existing Ordinary Shares whose names appear on the register as at the Record Date excluding certain overseas Shareholders as described in the Prospectus "Receiving Agent" Capita Registrars "Record Date" the close of business on 6 May 2005 "Resolutions" the resolutions set out in the notice of EGM at the end of the Prospectus "Seymour Pierce" Seymour Pierce Limited "Shareholders" holders of Ordinary Shares "Share Option Schemes" the Approved Scheme, the Unapproved Scheme and the LTIP "Unapproved Scheme" means the unapproved executive share option scheme adopted by ATH on 7 June 2004, further details of which are given in the Prospectus "uncertificated" or recorded on the relevant register of the share or security "in uncertificated form" concerned as being held in uncertificated form in CREST and title to which, by virtue of the CREST Regulations, may be transferred by means of CREST "Underwriting Agreement" the conditional agreement dated 10 May 2005 between Seymour Pierce and the Company further details of which are set out in the Prospectus This information is provided by RNS The company news service from the London Stock Exchange END IOEALMPTMMMMBAA
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