Safestyle UK PLC Result of Placing and Posting of Circular (1940J)

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RNS Number : 1940J

Safestyle UK PLC

08 April 2020

THIS ANNOUNCEMENT AND THE INFORMATION CONTAINED HEREIN IS RESTRICTED AND IS NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN WHOLE OR IN PART, DIRECTLY OR INDIRECTLY, IN, INTO OR FROM THE UNITED STATES, AUSTRALIA, CANADA, JAPAN, THE REPUBLIC OF SOUTH AFRICA, THE REPUBLIC OF IRELAND, NEW ZEALAND OR ANY OTHER JURISDICTION IN WHICH SUCH RELEASE, PUBLICATION OR DISTRIBUTION WOULD BE UNLAWFUL.

THIS ANNOUNCEMENT IS FOR INFORMATION PURPOSES ONLY AND DOES NOT CONSTITUTE OR CONTAIN ANY INVITATION, SOLICITATION, RECOMMENDATION, OFFER OR ADVICE TO ANY PERSON TO SUBSCRIBE FOR, OTHERWISE ACQUIRE OR DISPOSE OF ANY SECURITIES IN SAFESTYLE UK PLC OR ANY OTHER ENTITY IN ANY JURISDICTION. NEITHER THIS ANNOUNCEMENT NOR THE FACT OF ITS DISTRIBUTION SHALL FORM THE BASIS OF, OR BE RELIED ON IN CONNECTION WITH, ANY INVESTMENT DECISION IN RESPECT OF SAFESTYLE UK PLC

The information contained within this announcement is deemed by the Company to constitute inside information stipulated under the Market Abuse Regulation (EU) No. 596/2014. Upon the publication of this announcement via a Regulatory Information Service, this inside information is now considered to be in the public domain.

For immediate release

8 April 2020

SAFESTYLE UK PLC

("Safestyle" or the "Company" and together with its subsidiaries the "Group")

Result of Placing and Posting of Circular

Safestyle UK plc (AIM: SFE), the leading UK -- focused retailer and manufacturer of PVCu replacement windows and doors for the homeowner market, is pleased to announce the successful completion of the placing announced on 7 April (the "Placing Announcement").

A total of 50,000,000 Placing Shares have been placed at the Issue Price of 17 pence per share, raising GBP8.5 million before expenses subject, inter alia, to Shareholder approval being obtained at the General Meeting of the Company to be convened for 27 April 2020. The Placing was conducted by way of an accelerated bookbuild process. Zeus Capital and Liberum acted as joint bookrunners on the Placing.

As outlined in the Placing Announcement, the net proceeds are intended to strengthen the Company's balance sheet so that the business is well capitalised and has a strong cash buffer to ensure it can continue in business through and out of the current crisis relating to the COVID-19 pandemic.

The Directors have in aggregate subscribed for 619,000 Placing Shares at the Issue Price.

Application will be made to the London Stock Exchange for the Placing Shares to be admitted to trading on AIM. It is anticipated that Admission of the Placing Shares will take place at or around 8.00 a.m. on 28 April 2020. The Placing Shares will rank pari passu with the existing Ordinary Shares in issue. The Placing Shares will represent approximately 37.6% of the Company's enlarged issued share capital on Admission (assuming no other issuance of Ordinary Shares prior to Admission).

Following Admission of the Placing Shares, the Company's issued and fully paid share capital will consist of 132,808,896 Ordinary Shares, all of which carry one voting right per share. The Company does not hold any Ordinary Shares in treasury. The figure of 132,808,896 Ordinary Shares may be used by shareholders as the denominator for the calculation by which they will determine if they are required to notify their interest in, or a change to their interest in, the Company, under the Disclosure Guidance and Transparency Rules.

Related Party Transactions

The Directors have conditionally subscribed for an aggregate of 619,000 Placing Shares as set out below. Alantra Asset Management, Janus Henderson Investors and Cambridge Global Asset Management, substantial shareholders in the Company as defined in the AIM Rules for Companies (and therefore related parties of the Company for the purposes of the AIM Rules) (the "Substantial Shareholder Related Parties") have conditionally subscribed for 9,700,000, 6,136,564 and 5,000,000 Placing Shares respectively. Therefore, the participation of each of these parties in the Placing constitutes a related party transaction under Rule 13 of the AIM Rules.

In the case of each of the Directors below who has conditionally committed to subscribe, the remaining Directors are deemed to be independent. Therefore, having consulted with the Company's nominated adviser, Zeus Capital, each of the Directors' participation is considered, by the relevant independent Directors, to be fair and reasonable insofar as the Company's shareholders are concerned.

Their individual participations are set out below:

 
                         Initial Holding                      Resultant Holding 
                                   Percentage         Number of    Resulting 
                    Number of     of Existing    Placing Shares    number of       Percentage 
                     Ordinary    Issued Share    to be acquired     Ordinary      of Enlarged 
 Director              Shares         Capital      on Admission       Shares    Share Capital 
 Alan Lovell(1)       180,000           0.22%           270,000      450,000            0.34% 
 Mike Gallacher        50,000           0.06%           150,000      200,000            0.15% 
 Rob Neale             50,000           0.06%           150,000      200,000            0.15% 
 Fiona Goldsmith       20,000           0.02%            30,000       50,000            0.04% 
 Julia Porter           9,671           0.01%            19,000       28,671            0.02% 
 

1. This figure includes 20,000 Ordinary Shares that were acquired on 8 November 2019 which were not previously included in his disclosures

In the case of the Substantial Shareholder Related Parties, the Directors consider, having consulted with the Company's nominated adviser, Zeus Capital, that the terms of the Substantial Shareholder Related Parties participation in the Placing are fair and reasonable insofar as the Company's Shareholders are concerned.

Posting of Circular

The Company will shortly be publishing a Circular, containing a Notice of General Meeting, which will be sent to shareholders, together with a proxy form. The Circular will also be available on the Company's website at www.safestyleukplc.co.uk

Capitalised terms used but not defined in this announcement have the same meanings as set out in the Placing Announcement dated 7 April 2020.

Mike Gallacher, Chief Executive Officer of Safestyle, said:

"The strong support received from our shareholders, both existing and new, in the current challenging market is hugely welcome. I am also delighted that the Board has also committed to contribute significantly to the placing, demonstrating all of our Directors' strong belief in the growth strategy and potential of the Group. The business has made strong progress in recent years and I believe that, as a result of the actions taken, we are well placed to weather the COVID 19 crisis and emerge to resume our recent positive momentum.

Together with our existing funding arrangements, this equity fund raise significantly strengthens our balance sheet, providing further headroom should we need to extend our temporary shutdown in line with Government guidance, protecting the NHS and saving lives. The business acted promptly in ceasing all operations on 24 March 2020 and I am grateful to our customers and staff who responded to this challenging situation and the disruption it has caused with such understanding and flexibility. In addition I would like to take the opportunity, on behalf of the Board, to thank our shareholders, suppliers, banks, brokers and advisers for their strong support as we have worked together to protect the business and ensure that it emerges strongly when this crisis passes, as in due course it will."

Enquiries:

 
 Safestyle UK plc                                via FTI Consulting 
  Mike Gallacher, Chief Executive Officer 
  Rob Neale, Chief Financial Officer 
 Zeus Capital Limited (Nominated Adviser         Tel: [phone] 
  & Joint Broker) 
  Dan Bate / Daniel Harris / Dominic King 
 Liberum Capital Limited (Joint Broker)          Tel: [phone] 
  Neil Patel / Jamie Richards / Laura Hamilton 
 FTI Consulting (Financial PR)                   Tel: [phone] 
  Alex Beagley / James Styles / Sam Macpherson 
 

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April 08, 2020 03:14 ET (07:14 GMT)