Disposal

 

TIDMIDD 
 
RNS Number : 0718P 
ID Data Group PLC 
18 March 2009 
 

18 March 2009 
 
 
ID Data Group plc 
("ID Data" or the "Company") 
 
 
Disposal 
 
 
ID Data Group plc announces that ID Data Limited, the Company's main operating 
subsidiary which has been in administration since October 2008, has agreed to 
dispose of its  business  and certain of its assets, including its shares in TTi 
Card Technology (Europe) Ltd.  The disposal is expected to complete by 20 March 
2009. 
 
 
The business of ID Data Limited had been widely marketed to potential buyers 
and, although a number of expressions of interest were received, it was not 
possible to conclude a sale to any of these parties. 
 
 
In the absence of any buyer for the business, the Administrators (Malcolm 
Shierson and John Whitfield of Grant Thornton) would have needed to proceed with 
the closure of the business of ID Data Limited. Faced with this scenario, Peter 
Cox (ID Data's CEO) approached initially the main shareholders of ID Data to 
raise funds for ID Data to repurchase the assets of ID Data Limited. These 
approaches unfortunately did not provide sufficient funding and Peter Cox then 
approached external financial backers to assist him in the acquisition of the 
business, as he firmly believes that there is a successful future for the 
business together with its employees, customers and suppliers. Accordingly, the 
business and certain of the assets of ID Data Limited (including plant and 
stock) are to be acquired for GBP0.25 million in cash and the assumption of some 
GBP0.6 million of debt by a new company, Card Data Management Limited, which is 
30% owned by Mr Cox. 
 
 
As a director of the Company, Peter Cox is a related party and this transaction 
is a related party transaction for the purposes of the AIM Rules which require 
that announcements of related party transactions include a statement by the 
directors (excluding any director involved in the transaction as a related 
party) that they consider, having consulted with the AIM company's nominated 
adviser, that the terms of the transaction are fair and reasonable insofar as 
the AIM company's shareholders are concerned. However, the disposal described in 
this announcement is being made pursuant to the insolvency proceedings at ID 
Data Limited which is under the control of that company's Administrators acting 
independently of the board of ID Data. Accordingly it is not appropriate for the 
board of ID Data (excluding Peter Cox) to provide the fair and reasonable 
statement as it was not involved in the negotiation or implementation of the 
disposal. 
 
 
ID Data Limited made a loss before tax of GBP(1.5) million on turnover of 
GBP9.5 million for the year ended 31 March 2008 and had net liabilities of 
GBP(6.7) million at that date (these figures are unaudited). The proceeds of the 
disposal will be paid to ID Data Limited and there will be no payment to ID Data 
arising from the administration. 
 
 
In a statement issued by the Joint Administrators, Malcolm Shierson and John 
Whitfield stated: 
 
 
"The business of ID Data Limited has been widely marketed to industry and non 
industry organisations both before and during the administration period. We 
received seven significant expressions of interest, but primarily due to funding 
constraints in the current market, none of these parties completed the purchase 
of the business and assets of ID Data Limited.In light of this failure to sell 
the business and assets, we concluded that the immediate closure of the business 
was the only option available and it was following this that we received the 
offer from Card Data Management Limited which has led to the sale of the 
business.  We observed during the period of administration the ability of this 
business to service its clients professionally and meet the most demanding 
technology and service requirements, including the delivery of some US$2.5 
million worth of chip cards to Norway." 
 
 
ID Data Group plc - the future 
 
 
Following this disposal, ID Data now has a number of assets, including 
principally: UK tax losses at a holding company level; Irish tax losses through 
its wholly-owned non-trading subsidiary Cardbase Technologies Limited; and 
investments in Contis Group Limited (pre-paid card service provider; 6% 
interest), Sports Loyalty Limited (cardless reward programme; 3.9% interest) and 
Digital Locksmiths Limited (smart card security consulting; 50% interest). 
 
 
The Company will now review the assets it has left and its current and 
anticipated future liabilities; following the conclusion of this review and an 
assessment of its working capital position, the Company will advise shareholders 
of its intended future path.If appropriate the Company will convene a general 
meeting to obtain shareholder approval for its strategy going forward and also 
to approve a change in the Company's name as the trading name ID Data has been 
sold to Card Data Management Limited. 
 
 
Mike Blackburn, Chairman of ID Data, commented: 
 
 
"It is ironic that the core business of the Group should have been forced into 
administration due to the lack of support from a government-related creditor. 
That decision was taken when underlying trading was better than at any time 
since the Group was admitted to AIM in 2000. 
 
 
I very much regret the loss of shareholder value.Peter Cox, the largest 
individual shareholder, has worked tirelessly to achieve a different outcome. 
It is equally regrettable that there have been job losses at a time when the 
economy is not best placed to provide alternative employment for hard-working 
staff." 
 
 
Further announcements will be made in due course and in the meantime trading in 
the Company's shares on AIM remains suspended. 
 
 
-Ends- 
 
 
For further information, please contact: 
 
 
ID Data Group plc 
Peter Cox, Chief Executive 
[e-mail] 
Tel: [phone] 
 
 
Smith & Williamson Corporate Finance Limited 
Azhic Basirov / David Jones 
Tel: [phone] 
 
 
 
This information is provided by RNS 
            The company news service from the London Stock Exchange 
   END 
 
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