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Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
---|---|---|---|---|---|
Public Rec. | LSE:PUG | London | Ordinary Share | GB00B00LM737 | ORD 10P |
Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|---|---|
0.00 | 0.00% | 34.00 | 0.00 | 01:00:00 |
Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
---|---|---|---|---|---|
0 | 0 | N/A | 0 |
RNS Number:5113V Public Recruitment Group plc 25 April 2007 Appointment of Luke Johnson as Chairman and restructuring of the Board and Placing of 12,195,121 Ordinary Shares Public Recruitment Group PLC ("PRG" or the "Group"), the public sector recruitment and services group is pleased to announce that it is looking to raise #4.9 million through a placing of new ordinary shares with Risk Capital Partners and its associates and is restructuring the board of directors, to better reflect the needs of the business, post the #5.5 million disposal of the locum doctor division on Monday 23 April 2007. As part of the management restructuring, Luke Johnson, Chairman of Risk Capital Partners will join the board of directors as non-executive director following completion of the EGM. Concurrently, Richard Benton will step down as Chairman and from 1 June 2007 Luke will be appointed non-executive chairman and Richard will resign from the board. Dennis Hall, Portfolio Director at Baird Capital Partners Europe, the Group's largest shareholder, will join the board as a non-executive director from 30 April 2007, replacing Mike Fell. Within the executive board, Darren McLaney will resign with immediate effect as Chief Executive but remains on the board in a non-executive capacity, to facilitate a smooth hand-over to the new Chief Executive, Dean Kelly who is currently Managing Director of Education and Social. Nick Williams will also resign as Group Finance Director and be replaced by Daniel Urmson, Group Financial Controller on 31 May 2007. These board changes reflect the Group's plans to streamline the business model, adjusting the cost base in line with the Group's more focused business in the education and social work markets. Placing The Company today also announces that it proposes to raise #4.9 million (net of expenses) through the placing of new ordinary shares at 41p per share with Risk Capital Partners and associates who have committed to subscribe for #5 million. The Placing price represents a premium of 18.8% on the closing price on 24 April 2007. Together with the recent disposal of the locum doctors division this placing has reduced net debt by an aggregate #13 million (#12.7 million net of expenses). The Placing is subject to shareholder approval. A circular convening an EGM of the Company, which will take place on 24 May 2007, is being sent to shareholders. Commenting on the Placing, Darren McLaney, Chief Executive of Public Recruitment Group said: "The disposal of the locum doctor business, alongside the placing halves our debt. Additionally the Board has been restructured and I am delighted to welcome Luke Johnson who brings a wealth of experience and demonstrable track record of success. I firmly believe these changes will allow PRG to exploit its strong market position in the higher margin education and social work markets and is consistent with our previously stated aim of reducing net debt and focusing on organic growth to return value to shareholders. " For further enquiries: Enquiries: Darren McLaney /Nick Williams Public Recruitment Group PLC (0114 283 4925) Ginny Pulbrook / Fiona Bradshaw Citigate Dewe Rogerson, (0207 638 9571) PLACING STATISTICS (assuming all the Placing Shares are issued) Placing Price 41p Number of Placing Shares being placed on behalf of the Company 12,195,121 Number of Ordinary Shares in issue following Admission 45,108,095 Percentage of enlarged issues share capital following the Placing which is subject to 27% the Placing Estimated proceeds of the Placing available to the Company (net of expenses) #4.9 million EXPECTED TIMETABLE OF EVENTS Latest time for receipt of Forms of Proxy 10.30 a.m. on 22 May 2007 Extraordinary General Meeting 10.30 a.m. on 24 May 2007 Admission of the Placing Shares to AIM 8.00 a.m. on 25 May 2007 1. Introduction The Board announced today that the Company has agreed, subject to shareholder approval of the Resolutions, to raise approximately #5m, (#4.9m net of expenses), by way of a placing. Further details of the Placing, which has not been underwritten, are set out in paragraph 6 below. The necessary authority required for the allotment of Placing Shares pursuant to the Placing will be sought at an Extraordinary General Meeting convened for 10: 30 a.m. on 24 May 2007. The purpose of this document is to provide you with information on the Placing and to convene the EGM at which your approval will be sought for the Resolutions, as set out in the notice of EGM at the end of this document. 2. Background to and reasons for the Placing As announced earlier today, the Group intends to raise #4.9 million, net of expenses, from the Placing. PRG is a leading provider of qualified teachers and social workers to the UK public sector. Since it floated on AIM in April 2004, the Group has continued to acquire complimentary businesses with the objective of achieving a market leading position in its chosen sectors. The Group had gearing of 116 per cent. at 31 December 2006. The gearing is exacerbated by the discrepancy between debtor and creditor days. As a recruitment business, the Group is legally bound to make a prompt payment to a candidate for work performed. On average, it pays candidates after 5 days. This is in contrast to the average of 40 days that its clients take to settle invoices. The Group has to fund this timing gap of 35 days, and as the Group's business grows the amount of funding required increases. At 31 December 2006, the Group had net debt of #24.2m consisting of term loans of #14.7m, invoice discounting (net of cash) of #7m, both with Barclays Bank PLC, and loan notes resulting from previous acquisitions of #2.5m. The proceeds of the Placing will be used to reduce net debt and support the working capital requirements of the Group. 3. Sale of Public Recruitment Group Holdings Limited PRG announced on 23 April 2007 that on 20 April 2007 (the "Completion Date") Healthcare Locums PLC ("HCL") acquired the entire issued share capital of Public Recruitment Group Holdings Limited ("PRG Limited"), a wholly owned subsidiary of the Company. The consideration payable was approximately #4.5m in cash on the Completion Date with approximately #1m being held in escrow until 31 March 2008 (the "Agreement"). The monies held in escrow will be released in five instalments. The payment dates for the instalments are spread out over the period leading up to 31 March 2008. The sale and purchase agreement contains an either way adjustment mechanism whereby the Company is obliged to repay to HCL the amount (if any) by which the net current assets of PRG Limited and its subsidiaries is less than #1 and HCL is obliged to repay to the Company the amount (if any) by which the net current assets of PRG Limited and its subsidiaries is greater than #1. The net current assets of PRG Limited shall be determined as soon as reasonably practicable after the Completion Date. "Net current assets" for the purposes of the sale and purchase agreement are defined as the current assets of PRG Limited and its subsidiaries less the current liabilities of PRG Limited and its subsidiaries at the Completion Date. Under the terms of the sale and purchase agreement the Company has given HCL certain warranties. The proceeds of the disposal of PRG Limited will be used to reduce net debt and support the working capital requirements of the Group. 4. Board Changes Following the disposal of the health care division, the Group's sole focus will be on the merged education and social care sector. As a consequence, there will be several changes to the Board over the next few weeks. The proposed changes are outlined below: With effect from the conclusion of the EGM, subject to shareholder approval of the Resolutions, Luke Johnson will be appointed as a non-executive director of the Company and with effect from 1 June 2007, Luke will be appointed non-executive chairman and Richard Benton will resign from the Board. Luke Johnson (45) is Chairman of Channel 4 Television Corporation and chairman of Risk Capital Partners. He has experience of the staffing industry through Abacus Recruitment plc, where he was a director, and InterQuest Group plc, where he is a director and founder. He was involved for ten years until 2006 as an owner and director of Integrated Dental Holdings Limited, a major supplier to the public sector. Dennis Hall, a Portfolio Director at Baird Capital Partners Europe, will be appointed to the Board as non- executive director from 30 April 2007. Baird Capital Partners Europe is PRG's largest shareholder and own 38 per cent. of the ordinary share capital pre Placing. Upon the appointment of Dennis, Michael Fell will resign from the board. Darren McLaney will resign his position as CEO with immediate effect and take on a role of non- executive director. Dean Kelly will be promoted to CEO from his current position as Managing Director of the Education and Social business. Nick Williams will leave the position of Group Finance Director and will resign from the Board from 31 May and will be replaced by Daniel Urmson who is currently Group Financial Controller. Daniel is a qualified chartered accountant who has worked at PRG for more than 4 years. 5. Financial PRG's annual results for the year ended 31 December 2006, which were announced on 2 March 2007, are highlighted below: * Turnover increased by 8 per cent. to #86.7m (#80.2m) with strong gains in the education and health sectors; * Operating profit, adjusted for exceptional items and amortisation of goodwill, grew by 23 per cent. to #6.1m (#4.9m). This represented organic growth of 14 per cent. The increased turnover was achieved at a slightly higher margin and the conversion of net fee to adjusted operating profit grew to 33 per cent.; * Adjusted earnings per share grew to 10.5p (10.3p), and basic earnings per share grew by 42 per cent.; and * The Group generated #2.4m (#2.7m) of cash before financing and acquisitions. Bank Funding In April 2006, the Group agreed a funding facility with Barclays Bank PLC to a maximum of #30m. The facility consists of a term loan of #16.5m repayable in varying quarterly instalments to April 2011, an invoice discounting facility to a maximum of #12m and overdraft facility to a maximum of #1.5m. 6. The Placing The Company intends to raise #4.9m, net of expenses, through the placing of the Placing Shares. The Placing Shares will be offered to the Investors. The Placing will not be underwritten by Bridgewell. The Investors will subscribe, subject to shareholder approval of the Resolutions, Luke Johnson's appointment as non-executive director the Board of the Company and the compliance by the Company with the terms of the Subscription Agreement, for the Placing Shares at the Placing Price. The Subscription Agreement contains warranties given by the Company to the Investors. The Placing Price represents a premium of approximately 18.8 per cent. to the closing mid-market price of 34.5 pence per Ordinary Share as at 24 April 2007, being the latest practicable date prior to the announcement of the Placing. The Placing Shares will rank in full for all dividends and otherwise pari passu with the existing Ordinary Shares. The Placing Shares are expected to be admitted to trading on AIM on 25 May 2007. The Placing is conditional, inter alia, upon: * the approval of the Resolutions at the EGM; and * the appointment, conditional only on Admission, of Luke Johnson as a non-executive director of the Company. This information is provided by RNS The company news service from the London Stock Exchange END IOEUVASRBRRSUAR
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