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Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
---|---|---|---|---|---|
Black Arrow | LSE:BLKA | London | Ordinary Share | GB0001014975 | ORD 20P |
Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|---|---|
0.00 | 0.00% | 52.50 | 0.00 | 01:00:00 |
Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
---|---|---|---|---|---|
0 | 0 | N/A | 0 |
TIDMBLKA RNS Number : 7540T Black Arrow Group PLC 11 June 2009 11 June 2009 RNS, The London Stock Exchange, LONDON EC4M 7LS Black Arrow Group plc ("BAG" or the "Company") DISPOSAL OF BUSINESS The Company is pleased to announce that it has entered into a conditional agreement to sell its furniture and fit out business ("Furniture") and expects to complete the sale by 31 July 2009. The Company's Furniture business manufactures, and supplies office furniture to international and domestic companies, and its fit out business complements this by providing a complete solution to client's requirements following a relocation or re configuration of their office space. A company ("Newco") has been formed into which the business undertakings of Logic Office Group plc and Kudos Designs Limited are to be transferred. Logic Office Group plc will change its name to Black Arrow Limited, and Newco will adopt the Logic Office Group plc name and trade under the Logic banner. Logic Office Group plc and Kudos Designs Limited are currently wholly owned subsidiaries of BAG and will become dormant on completion of the sale. Newco will incorporate the Kudos business with that of Logic Office Group plc. All executive directors and staff employed by Furniture are to transfer to Newco. Following completion, 40% of the share capital of Newco will be held by existing management of Furniture, 9% will be held by Michael Gardner, 3% by Philip Westwood , 39% by AP Pensions 1989 and BAG will hold 9%. The share capital of Newco will be 100,000 shares of GBP1 each and BAG as part of the condition of sale will subscribe for 9,000 shares at par. Mr Paul Edward, currently an executive director of BAG will become a non-executive director, and will also sit on the board of Newco together with the executive directors of Logic Office Group plc employed by Furniture. In the last published accounts of Black Arrow Group plc to 31 March 2008, the segmental results for Furniture disclosed a loss of GBP974,000. The assets employed by Furniture will be sold to Newco at their written-down book value of GBP335,000. These assets comprise plant and machinery, fixtures, computers and vehicles. Existing trade debtors will be retained and collected by BAG. In addition, Newco will also pay to the Company an initial GBP500,000 of goodwill giving a total initial consideration of GBP835,000. Newco will also make an additional payment to the Company at the end of three years of trading if the aggregate EBITDA of Newco for that period exceeds GBP1 million. This payment is calculated as follows: For the first GBP1 million above the aggregate EBITDA of GBP1 million the additional payment will be 66 pence for each GBP1 above GBP1 million. In addition, for each subsequent GBP1 above an aggregate EBITDA of GBP2 million the additional payment will be 50 pence for each GBP1 above GBP2 million with no upper limit. The Company will make available to Newco a loan of GBP1,250,000 on completion with interest at 4% above The Bank of England base rate, payable quarterly in arrears, secured by a debenture over all of the assets of Newco. The loan is repayable within five years of completion. Newco will at the same time pay the Company the purchase consideration for the fixed assets of GBP335,000. The initial goodwill consideration of GBP500,000 is to be deferred for up to two years with GBP250,000 repayable within one year, bearing interest at 7% over base until repayment. The remaining GBP250,000 will bear interest at 7% over base after one year following completion. Following completion of this transaction the Company will continue to expand its leasing and property divisions. The leasing division leases equipment to clients for a monthly or quarterly rental over an agreed period, usually between three and five years. At the end of that period the equipment may continue to be used by the client on payment of a further rental, or returned to the Company. The property division rents out properties to third parties and group occupiers. These properties were or are used by the group and where vacated by the group have subsequently been let to third parties. Newco will enter into short-term agreements with BAG to rent the manufacturing facility in Rotherham at GBP135,000 per annum and office space in the Company's head office in Hounslow at GBP66,000 per annum (exclusive of shared costs). The Company will hold 9% of the issued share capital of Newco until such time as its loan has been repaid and additional goodwill if applicable has been received. Subsequently it will, if required, sell its investment back to Newco at a value to be determined by an independent valuer to be agreed between the parties. The proceeds from the disposal will be used to part fund the loan provided to Newco for working capital and ultimately to expand the remaining two activities of the Company. The furniture and fit out business was founded some fifty years ago by Arnold and Maurice Edward whose families hold the majority of shares in the parent company and upon completion of this transaction it will enable them to retire from the furniture business which has been loss making in the past few years, and concentrate on the two remaining activities of BAG. Pursuant to AIM rule 15 (disposals resulting in a fundamental change of business) this disposal is conditional upon the consent of the Company's shareholders being given in general meeting and a circular containing details of the transaction will be sent to shareholders shortly. Arnold and Maurice Edward and their families who control over 74% of the ordinary share capital of the Company intend to vote in favour of this transaction. The disposal of Furniture and other transactions with Newco described above are each being treated as related party transactions under the AIM rules. Accordingly, the directors of the Company, with Mr Paul Edward abstaining, consider that, after consultation with WH Ireland Ltd, the Company's nominated adviser, the terms of the transactions are fair and reasonable insofar as the shareholders of the Company are concerned. . Enquiries: Arnold Edward, Black Arrow Group plcTel: 0208 572 7474 David Porter, W H IrelandTel: 0207 220 1666 This information is provided by RNS The company news service from the London Stock Exchange END DISFFLFFKQBFBBK
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