Related Party Announcement

RNS Number:2056C
C.I. Traders Limited
23 August 2004

                           Related Party Announcement

                     C.I. Traders Limited ("C.I. Traders")

                   Acquisition of ComProp Limited ("ComProp")



The independent directors of C.I. Traders ("C.I. Traders") and the independent
directors of ComProp have today announced that they have reached agreement on
the terms of a recommended cash and share offer (the "Offer") to be made by
Collins Stewart Limited on behalf of C.I. Traders for the entire issued and to
be issued ordinary share capital of ComProp not already owned by C.I. Traders or
any of its subsidiaries.



The Offer will be made on the following basis: #11.88 in cash and 6 New C.I.
Traders Shares for every 11 ComProp Shares. The Offer values each ComProp Share
at 144 pence and the existing issued ordinary share capital of ComProp at
approximately #51.3 million.  The total consideration payable under the Offer
comprises approximately #35.5 million in cash and the issue of 17.9 million New
C.I. Traders Shares.   ComProp Shareholders who validly accept the Offer may
elect subject to availability to use the Mix and Match Election to vary the
proportions in which they receive New C.I. Traders Shares and cash in respect of
their holdings of ComProp Shares.  However, the total number of New C.I. Traders
Shares and the total amount of cash to be issued under the Offer will not be
varied as a result of the Mix and Match Elections.  Fractional entitlements to
New C.I. Traders Shares will be rounded down and will not be issued.
Application will be made for the New C.I. Traders Shares to be admitted to the
Alternative Investment Market of the London Stock Exchange.



C.I. Traders has recently entered into arrangements with Royal Bank of Scotland
International Limited under which most of its existing borrowings will be repaid
and new facilities granted.  These facilities will include a 7 year term loan
out of which the cash consideration payable under the Offer will be funded.



The Offer represents a premium of approximately 15.7 per cent. to the closing
middle market price of 124.5 pence per ComProp Share on 20 August 2004, the last
dealing day prior to announcement of the Offer.



For the purposes of the AIM rules, in view of the interests in ComProp by Thomas
H Scott which amounts to a 29.55 per cent. shareholding in ComProp, C.I. Traders
is deemed to be a related party of ComProp.  Furthermore, Thomas H Scott, Martin
Bralsford and Thomas R Scott sit on the boards of both companies.  Accordingly,
the decision to make the Offer has therefore been made and its terms approved by
a committee comprising the independent directors of C.I. Traders; Sir Michael
Wilkes, Jurat David Lowe and David Norman.  David Lowe and David Norman each
have interests in a relatively small number of ComProp  Shares.



The independent directors of ComProp are John Henwood MBE, Nigel Jones and
Stephen Down.



ComProp is the Jersey parent company of a property investment and development
group operating in Guernsey.  It acquired the Admiral Park site in 2001 at an
early stage in the development of the area as a mixed use edge-of-town hub for
St Peter Port.  As well as Le Riche's Checkers superstore, a new B&Q superstore
has been built and a number of prestigious office buildings are under
construction.  Further plans for Admiral Park include a motor filling station,
additional retail outlets, a bank, hospitality businesses and high quality
apartments.  In addition ComProp has recently undertaken the development of a
major office building in the centre of St Peter Port which was pre-let to
Generali Worldwide Insurance for a 21 year term.



For the year ended 31 March 2004, ComProp reported turnover, principally rents
receivable of #4.8 million (2003: #4.1 million) and a profit on ordinary
activities before taxation of #752,000 (2003: #506,000).  As at 31 March 2004,
ComProp had net assets of #51.8 million (2003: #39.2 million).

A valuation report prepared by Montagu Evans a leading London firm of property
valuers valued ComProp's property portfolio, including investment properties,
residential properties and development properties at their market values, at
#100.11 million as at 31 January 2004.  This report has been independently
reviewed on behalf of C.I. Traders by CB Richard Ellis who have confirmed to
C.I. Traders that in aggregate they agree with the overall level of figures
provided by Montagu Evans.  On this basis, the Offer represents a discount of
approximately 4 per cent. to ComProp's net asset value at 31 March 2004.



The independent directors of C.I. Traders believe that the acquisition of
ComProp offers a strategic opportunity to combine expertise with a portfolio of
valuable properties and sites in the Channel Islands.  In particular, it will
permit the enlarged group to maximise the benefit to be derived from the Admiral
Park development, the major retail and leisure edge-of-town hub for St Peter
Port, Guernsey which is likely to remain the only such development for the
foreseeable future.



C.I. Traders has already made a major investment by siting its Checkers
superstore there and sees further potential for siting other retailing and
hospitality outlets there.  By controlling the future development of Admiral
Park, C.I. Traders will be able to ensure it is complementary to the other
interests of C.I. Traders and will be able to plan appropriate parking and
access arrangements to further strengthen its activities there.



The acquisition will bring a management team offering top level property
development expertise and contacts in Guernsey, complementing C.I. Traders'
existing team in Jersey, together with experience in property finance.  Both
would assist C.I. Traders in capitalising on its existing property portfolio
which includes a number of sites which are, or will soon be, vacant and
available for development.  Rather than sell those sites to other property
developers, C.I. Traders will be able to undertake the development activity and
secure the development benefits and long term rental income for itself.



The independent directors of C.I. Traders, consider, having consulted with
Collins Stewart, that the terms of the transaction are fair and reasonable
insofar as C.I. Traders' shareholders are concerned. A circular will be
despatched to the shareholders of C.I. Traders on 23 August 2004 giving details
of the Offer.



The total value of the Offer has been calculated using the total number of
ComProp shares in issue of 35,649,858 and assumes a value of 66.0 pence per New
C.I. Traders Share being the middle market price at the close of business on 20
August 2004 (the last dealing day prior to the announcement of the Offer).





END



For further enquiries :


Collins Stewart : Andrew Dawber/Seema Paterson          020 7523 8320/8321

C.I. Traders : Sir Michael Wilkes                       01534 508 200


                      This information is provided by RNS
            The company news service from the London Stock Exchange
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