Ross Group PLC Proposed Acquisition of Archipelago Aquaculture (0433C)

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RNS Number : 0433C

Ross Group PLC

27 September 2018

Ross Group Plc ("RGP" or the "Company")

Proposed Acquisition of Archipelago Aquaculture Group Ltd for a Placing of 10% New RGP Ordinary Shares with Consideration Shares of a total 9.9% of RGP enlarged share capital and new Board Appointments.

Ross Group Plc (LSE: RGP) is pleased to announce that, subject to certain conditions, it has agreed to acquire the entire issued share capital of Archipelago Aquaculture Group Ltd. ("AAG") from Global Blue Technologies Inc. ("GBT") (the "Acquisition").

AAG, including all subsidiaries, currently has no gross assets, revenues or attributable profits. It plans to start producing revenue in the near future, having already achieved proof of concept in its specialized extraction of Chitin, which is understood to be one of the most environmentally-friendly and economically effective extraction processes within its industry.

Acquisition Highlights

GBT is a US company that has created the world's first commercially viable biosecure recyclable aquaculture system ("RAS") for the production of high quality, high value and best-tasting organic colossal and extra colossal shrimp.

AAG contains the start-up businesses of Mari Signum Limited, Mari Signum Dragon Drying-MS LLC, Mari Signum Mid-Atlantic LLC and Prometheus Progenitor Genetics Technologies Limited LLC, which are specifically supply chain companies involved in the research, development and production of Chitin, the main ingredient in the exoskeletons of arthropods and crustaceans.

Chitin is a natural bio-degradable polymer involved in the plastics, agricultural, veterinary, textile, cosmetic and pharmaceutical industries.

AAG intends to focus on providing the highest possible quality Chitin to targeted pharmaceutical customers on a very selective strategic basis.

Details of the Placing and Consideration Shares

The consideration for the Acquisition is 17,947,943 Ordinary Shares at a placing price of 1p per share to the current AAG shareholders (the "Placing Shares") representing 10% of RGP's existing issued share capital.

Also, as an additional consideration for the Acquisition, RGP will issue 26,667,262 Ordinary Shares (the "Consideration Shares") representing an overall total 9.9% of RGP's existing enlarged issued share capital, at a price of 1p per Consideration Share to the current AAG shareholders.

Upon completion of the Acquisition, Global Blue Technologies Inc. will own 44,615,205 Ordinary Shares, representing a total 19.9 % of the enlarged share capital of RGP.

The Placing Shares and the Consideration Shares will, when issued, be credited as fully paid and will rank pari passu with the existing RGP Ordinary Shares.

Application will be made to the London Stock Exchange for admission of the Placing Shares to trading on the main market of the London Stock Exchange. It is expected that Admission will take place, and that dealings in the Placing Shares on the London Stock Exchange will commence at 8.00 a.m. on 4(th) October 2018.

Board Appointments

It is proposed that three GBT executives, John Peter Keyes, Victoria White and Stephen LaPointe, will join the Board of Ross as Executive Directors and Franklin Fay and Lorenzo Juanta will join the Board as Non-Executive Directors. In addition, it is also proposed that Professor Georg Holländer will be invited to join the Board as a Senior Independent Non-Executive Director.

Therefore, the enlarged Board is to be as follows:

Barry Richard Pettitt (Executive)

Wade Lionel Hopkins (Executive)

Shashank Mehta (Executive)

John Peter Keyes (Executive)

Victoria White (Executive)

Stephen LaPointe (Executive)

Professor Georg Holländer (Senior Independent Non-Executive)

Franklin Fay (Non-Executive)

Lorenzo Juarez (Non-Executive)

Koji Fusa (Non-Executive)

Michael Jonathan Simon (Non-Executive)

Services Contracts

Service Contracts have been entered into with all Directors as follows:

Barry Richard Pettitt shall continue as Chairman and become Group Managing Director with an annual service contract based on the same previous Company remuneration policy and structure of being paid a nominal GBP1.00 per annum together with an applicable performance-related bonus scheme, until such time that the Company becomes profitable and/or is with enough working capital to thereafter provide a remuneration structure commensurate with the terms and conditions of other similar appointments on the Premium Listing of the Main Board of the LSE.

Lorenzo Juarez and Franklin Fay are appointed as a Non-Executive Directors and Lorenzo Juarez is the new Non-Executive Group Vice-Chairman. Both have initial 1 year Service Agreements and remunerations of GBP8,000 per annum until the Company becomes profitable and thereafter will be commensurate with terms and conditions of other similar appointments on the Premium Listing of the Main Board of the LSE.

John Peter Keyes is appointed as an Executive Director and Group Chief Executive Officer, Stephen C. LaPointe is appointed as an Executive Director and Group Financial Director, Victoria White is appointed as an Executive Director and President of the Mari Signum subsidiaries; All having annual service contracts based on the same previous Company remuneration policy and structure of being paid a nominal GBP1.00 per annum together with an applicable performance-related bonus scheme, until such time that the Company becomes profitable and/or is with enough working capital to thereafter provide a remuneration structure commensurate with the terms and conditions of other similar appointments on the Premium Listing of the Main Board of the LSE.

Wade Lionel Hopkins and Shashank Mehta shall continue as Executive Directors with an annual service contract based on the same previous Company remuneration policy and structure of being paid a nominal GBP1.00 per annum together with an applicable performance-related bonus scheme, until such time that the Company becomes profitable and/or is with enough working capital to thereafter provide a remuneration structure commensurate with the terms and conditions of other similar appointments on the Premium Listing of the Main Board of the LSE.

Professor Georg Holländer is to be appointed as Senior Independent Non-Executive Director for an initial period of 1 year and has entered into a letter of appointment subject to confirmation by Oxford University with remuneration of GBP38,600 per annum until the Company becomes profitable and thereafter will be commensurate with terms and conditions of other similar appointments on the Premium Listing of the Main Board of the LSE.

Michael Jonathan Simon and Koji Fusa shall continue as Non-Executive Directors of the Buyer and will enter into letters of appointment in an agreed form with remunerations to be not less than GBP8,000 per annum until the Company becomes profitable and thereafter will be commensurate with terms and conditions of other similar appointments on the Premium Listing of the Main Board of the LSE.

Biographies for each of the new Directors will be available on the Ross Group website (www.ross-group.co.uk)

At the date of this announcement, no new Directors have any holdings in the Ordinary Shares of the Company.

There are no further details required to be disclosed pursuant to Listing Rule 9.6.13R.

AGM

Notice of the Annual General Meeting of the Company will be sent to Shareholders shortly after this Announcement.

The AGM is scheduled to be held at 3.00 p.m. on 19th October 2018 at Carter Backer Winter offices, 66 Prescot street, London E1 8NN, United Kingdom.

Ross Group Chairman & CEO, Barry Richard Pettitt, made the following statement:

"This is an excellent acquisition for Ross Group Plc and its shareholders, which I see as being the starting point of a new development to our existing business for the Group and the opportunity for Mari Signum and Prometheus to become one of the leading supply chain providers of Chitin. I would also like to welcome all our new Executive and Non-Executive Directors to our Group management team and, in particular, I am very honoured to have Professor Georg Holländer to join as our Senior Independent Non-Executive Director. Professor Holländer is the current Hoffmann and Action Medical Research Professor of Developmental Medicine at Oxford University and is an expert in the field where Chitin has potential biomedical applications.."

For further information please contact:

Ross Group

Wade Lionel Hopkins [phone]

or

   Shashank Mehta         [e-mail] 

IMPORTANT NOTICE

This announcement contains inside information as defined under the Market Abuse Regulation (EU) No. 596/2014 ("MAR").

This announcement has been issued by, and is the sole responsibility of, Ross Group Plc.

This announcement is for information purposes only and is not intended to and does not constitute or form part of any offer or invitation to purchase or subscribe for, or any solicitation to purchase or subscribe for, Ordinary Shares, including the Placing Shares and the Consideration Shares, in any jurisdiction. No person has been authorised to give any information or make any representations other than those contained in this announcement and, if given or made, such information or representations must not be relied upon as having been authorised by or on behalf of the Company. The Company takes no responsibility or liability for, and can provide no assurance as to the reliability of, other information that you may be given. The contents of this announcement are not to be construed as legal, business or tax advice. Each Shareholder should consult their own legal adviser, financial adviser or tax adviser for legal, financial or tax advice respectively. This announcement is not an offer of securities for sale in the United States and there will be no public offer of securities in the United States. The securities discussed herein have not been and will not be registered under the US Securities Act of

1933, as amended (the "Securities Act") or under the securities law of any state or other jurisdiction of the United States and may not be offered or sold, directly or indirectly, in or into the United States except pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act and otherwise in compliance with any applicable securities laws of any state or other jurisdiction of the United States. Neither the Ordinary Shares nor the Placing Shares or the Consideration Shares have been approved or disapproved by the US Securities and Exchange Commission, any state securities commission or any US regulatory authority, nor have such authorities reviewed or passed upon the adequacy or accuracy of this announcement. Any representation to the contrary is a criminal offence in the United States.

This announcement contains (or may contain) statements that are, or may be deemed to be, "forward-looking statements". Forward-looking statements are based on current expectations and projections about future events and other matters that are not historical fact. These forward-looking statements are sometimes identified by the use of a date in the future or forward-looking terminology, including, but not limited to, the words "aim", "anticipate", "believe", "intend", "plan", "estimate", "expect", "may", "target", "project", "will", "could" or "should" or, in each case, their negative or other variations or words of similar meaning. These forward-looking statements include matters that are not historical facts and include statements that reflect the Directors' intentions, beliefs and current expectations. By their nature, forward-looking statements involve risks and uncertainties because they relate to events and depend on circumstances that may or may not occur in the future or are beyond Ross' control. They are not guarantees of future performance and are based on one or more assumptions. Forward-looking statements appear in a number of places throughout this Announcement and include statements regarding the intentions, beliefs or current expectations of Ross Group.

Statements contained in this announcement regarding past trends or activities should not be taken as a representation that such trends or activities will continue in the future. Any forward-looking statements in this announcement reflect Ross group's view with respect to future events as at the date of this announcement and are subject to risks relating to future events and other risks, uncertainties and assumptions relating to the conditions to the Acquisition being satisfied, increased leverage as a result of the Acquisition, Ross Group's ability to integrate the businesses and retention of key personnel, the successful realisation of the anticipated synergies and strategic benefits and an adequate return on its investment from the Acquisition, consumer behaviour, result of operations, financial condition, growth, strategy. No assurances can be given that the forward-looking statements in this announcement will be realised.

Forward-looking statements contained in this announcement apply only as at the date of this announcement. Subject to any obligations under MAR, the Listing Rules and the Disclosure Guidance and Transparency Rules or any other applicable law or regulation, Ross Group undertakes no obligation publicly to update or review any forward-looking statement, whether as a result of new information, future developments or otherwise.

This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact [e-mail] or visit www.rns.com.

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September 27, 2018 02:00 ET (06:00 GMT)